Audit 348403

Accounting Policies: Note 1: Scope of Presentation: The accompanying schedule presents only the expenditures incurred by the San Andreas Sanitary District that are reimbursable under federal programs of federal financial assistance. For the purposes of this schedule, federal awards include both federal financial assistance received directly from a federal agency, as well as federal funds received indirectly by the District from a non-federal agency or other organization. Only the portion of program expenditures in excess of the maximum federal reimbursement authorized or the portion of the program expenditures that were funded with state, local or other non-federal funds are excluded from the accompanying schedule. Note 2: Basis of Accounting: The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of the District and is presented on the modified accrual basis of accounting. 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). Note 3: Relationship to Financial Statements: The District’s activities are accounted for as an Enterprise Fund which uses the full accrual basis of accounting under generally accepted accounting principles, which differs from the modified accrual basis of accounting. Under the modified accrual basis, costs related to acquisition and construction of capital assets are considered expenditures in the period incurred, rather than being capitalized as a capital asset on the balance sheet under the full accrual basis of accounting. Accordingly, the modified accrual basis does not report depreciation expense as would be done on the full accrual basis of accounting Note 4: Loans Outstanding: The District does not have any federal loans outstanding with a continuing compliance requirement. Note 5: Passed Through to Subrecipients: No federal expenditures were passed through to subrecipients during the year. De Minimis Rate Used: N Rate Explanation: No indirect costs were reimbursed with the Federal Grants