Audit 345433

Title: NOTE -1 BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Avondale Water & Sanitation District has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of the Avondale Water & Sanitation District under programs of the federal government for the year ended December 31, 2024. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the Avondale Water & Sanitation District, it is not intended to and does not present the financial position, changes in net assets of the Avondale Water & Sanitation District.

Title: NOTE – 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Avondale Water & Sanitation District has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.

Title: NOTE – 3 INDIRECT COST RATES Accounting Policies: Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Avondale Water & Sanitation District has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Avondale Water & Sanitation District has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.

Title: NOTE – 4 SUB-RECIPIENTS Accounting Policies: Expenditures reported on the schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: The Avondale Water & Sanitation District has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. No payments were made to sub-recipients in the fiscal year ended December 31, 2024.