Audit 364931

Title: NOTE A – BASIS OF PRESENTATION Accounting Policies: Expenditure reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance wherein certain types of expenditures may or may not be allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Authority 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 Highland County Metropolitan Housing Authority (the Authority) under programs of the federal government for the year ended December 31, 2024. The information in this schedule is prepared 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 Authority, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Authority.

Title: NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditure reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance wherein certain types of expenditures may or may not be allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. Expenditure reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance wherein certain types of expenditures may or may not be allowed or may be limited as to reimbursement.

Title: NOTE C – INDIRECT COST RATE Accounting Policies: Expenditure reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance wherein certain types of expenditures may or may not be allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Authority has elected not to use the 10-percent percent de minimis indirect cost rate as allowed under the Uniform Guidance.

Title: NOTE D – SUBRECIPIENTS Accounting Policies: Expenditure reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance wherein certain types of expenditures may or may not be allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Authority provided no federal awards to subrecipients during the year ended December 31, 2024.

Title: NOTE E – DISCLOSURE OF OTHER FORMS OF ASSISTANCE Accounting Policies: Expenditure reported on the Schedule are reported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance wherein certain types of expenditures may or may not be allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Authority received no federal awards of non-monetary assistance that are required to be disclosed for the year ended December 31, 2024. The Authority had no loans, loan guarantees, or federally restricted endowment funds required to be disclosed for the year ended December 31, 2024.