Title: NOTE A--BASIS OF PRESENTATION
Accounting Policies: NOTE A--Basis of Presentation - The accompanying schedule of expenditures of federal awards and schedule of expenditures of state financial assistance include the federal and state award activity of Covenant and subsidiaries and are presented on the accrual basis of accounting. The information in these schedules is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the State of Tennessee Comptroller of the Treasury, respectively. Therefore, some amounts presented in these schedules may differ from amounts presented in, or used in the preparation of, the consolidated financial statements.
De Minimis Rate Used: Y
Rate Explanation: De Minimis Indirect Cost Rate: Covenant has elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance for certain federal awards where no negotiated indirect cost rate agreement exists and the use of the de minimis rate is permitted by the awarding agency. For other federal programs, Covenant did not charge indirect costs in accordance with the terms of the specific award.
The accompanying schedule of expenditures of federal awards and schedule of expenditures of state financial assistance include the federal and state award activity of Covenant and subsidiaries and are presented on the accrual basis of accounting. The information in these schedules is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the State of Tennessee Comptroller of the Treasury, respectively. Therefore, some amounts presented in these schedules may differ from amounts presented in, or used in the preparation of, the consolidated financial statements.
Title: NOTE B--SIGNIFICANT ACCOUNTING POLICIES
Accounting Policies: NOTE A--Basis of Presentation - The accompanying schedule of expenditures of federal awards and schedule of expenditures of state financial assistance include the federal and state award activity of Covenant and subsidiaries and are presented on the accrual basis of accounting. The information in these schedules is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the State of Tennessee Comptroller of the Treasury, respectively. Therefore, some amounts presented in these schedules may differ from amounts presented in, or used in the preparation of, the consolidated financial statements.
De Minimis Rate Used: Y
Rate Explanation: De Minimis Indirect Cost Rate: Covenant has elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance for certain federal awards where no negotiated indirect cost rate agreement exists and the use of the de minimis rate is permitted by the awarding agency. For other federal programs, Covenant did not charge indirect costs in accordance with the terms of the specific award.
De Minimis Indirect Cost Rate: Covenant has elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance for certain federal awards where no negotiated indirect cost rate agreement exists and the use of the de minimis rate is permitted by the awarding agency. For other federal programs, Covenant did not charge indirect costs in accordance with the terms of the specific award.
Title: NOTE C--CONTINGENCIES
Accounting Policies: NOTE A--Basis of Presentation - The accompanying schedule of expenditures of federal awards and schedule of expenditures of state financial assistance include the federal and state award activity of Covenant and subsidiaries and are presented on the accrual basis of accounting. The information in these schedules is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulation (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the State of Tennessee Comptroller of the Treasury, respectively. Therefore, some amounts presented in these schedules may differ from amounts presented in, or used in the preparation of, the consolidated financial statements.
De Minimis Rate Used: Y
Rate Explanation: De Minimis Indirect Cost Rate: Covenant has elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance for certain federal awards where no negotiated indirect cost rate agreement exists and the use of the de minimis rate is permitted by the awarding agency. For other federal programs, Covenant did not charge indirect costs in accordance with the terms of the specific award.
Covenant's federal and state programs are subject to financial and compliance audits by grantor agencies which, if instances of material noncompliance are found, may result in disallowed expenditures and affect Covenant's continued participation in specific programs. The amount, if any, of expenditures that may be disallowed by the grantor agencies cannot be determined at this time. Covenant believes such amounts, if any, to be immaterial.