Audit 398739

The accompanying Schedule of Expenditures of Federal Awards (the “Schedule”) includes the federal grants and cost reimbursement contracts transactions of The RAND Corporation and its subsidiaries (RAND) recorded on the cash basis of accounting and 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). The Schedule summarizes the expenditures of RAND under programs of the federal government for the year ended September 30, 2025. Because the Schedule presents only a selected portion of the operations of RAND, it is not intended to and does not present the financial position, changes in net assets or cash flows of RAND in accordance with accounting principles generally accepted in the United States of America. The grants and contracts listed relate predominately to Research and Development Programs. Assistance Listing Numbers and pass through entity numbers or other identifiers are provided when available. Expenditures for direct costs are recognized on a cash basis of accounting following the cost accounting principles contained in Title 48 U.S. Code of Federal Regulations Federal Acquisition Regulations System and the Uniform Guidance, as applicable. Under those cost principles, certain types of expenditures are not allowable or are limited as reimbursements. Moreover, expenditures include a portion of costs associated with general company activities which are allocated to awards under negotiated formulas commonly referred to as indirect cost rates. Negative amounts represent adjustments to amounts reported in the prior year, in the normal course of business.

RAND has elected not to use the 10% de minimis cost rate allowed under the Uniform Guidance for awards issued prior to October 1, 2024 or the 15% de minimis cost rate allowed under the Uniform Guidance for awards issued on or after October 1, 2024. RAND used preliminary indirect rates for reimbursement of indirect costs, negotiated with the Defense Contract Management Agency (DCMA). DCMA engages the Defense Contract Audit Agency (DCAA) to audit RAND’s indirect rates. As of the date of the issuance of this report, the final indirect cost rates for the year ended September 30, 2025 have been submitted to the DCMA. As of the date of the issuance of this report, the audit for September 30, 2025 has not been performed by the DCAA. In the opinion of management, the results of the audit will not have a material impact on the Schedule.