Audit 354608

Title: Basis of Presentation Accounting Policies: Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the 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. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of United Hospital District, Todd, Morrison, Cass, and Wadena Counties, Minnesota (the “District”). 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 (the “Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the District, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the District.

Title: Subrecipients Accounting Policies: Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the 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. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Lakewood Health System leases real estate and buildings from the District under a finance lease. Lakewood Health System pays the monthly debt service on the U.S. Department of Agriculture Community Facilities Loan program debt held by the District in lieu of making monthly lease payments to the District. The District accounts for the finance lease of facilities financed by the U.S. Department of Agriculture debt as being passed through from the District to Lakewood Health System in the accompanying Schedule.

Title: Community Facilities Loans Accounting Policies: Summary of Significant Accounting Policies Expenditures reported on the Schedule are reported on the 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. De Minimis Rate Used: N Rate Explanation: The District has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The District has outstanding loans with the U.S. Department of Agriculture. The loan balances outstanding at the beginning of the year are included in the federal expenditures presented in the Schedule. The District received no additional U.S. Department of Agriculture loans during the year. The balance of the loans outstanding at December 31, 2024, are $39,123,581.