Notes to SEFA
Accounting Policies: 1. For all Federal programs, the District uses the fund types specified in Texas Education Agencys (TEA) Financial Accountability System Resource Guide (Resource Guide). Special revenue funds are used to account for resources restricted to, or designated for, specific purposes by a grantor. Federal and state financial assistance generally is accounted for in a Special Revenue Fund.2. The accounting and financial reporting treatment applied to a fund is determined by its measurement focus. The Governmental Fund types are accounted for using a current financial resources measurement focus. All federal grant funds are accounted for in a Special Revenue Fund which is a Governmental Fund type. With this measurement focus, only current assets and current liabilities and the fund balance are included on the balance sheet. Operating statements of these funds present increases and decreases in net current assets. The modified accrual basis of accounting is used for the Governmental Fund types. This basis of accounting recognizes revenues in the accounting period in which they become susceptible to accrual, i.e., both measurable and available, and expenditures in the accounting period in which the fund liability is incurred, if measurable, except for unmatured interest on long-term debt, which is recognized when due, and certain compensated absences and claims and judgments, which are recognized when the obligations are expected to be liquidated with expendable available financial resources.Federal grant funds are considered to be earned to the extent of expenditures are made under the provisions of the grant and, accordingly, when such funds are received, they are recorded as unearned revenues until earned.3. According to the Resource Guide, funds received from the School Health and Related Services (SHARS) program represent reimbursements to the District for school health based services which are not already provided to special education students enrolled in the Medicaid Program, and consequently these revenues in the amount of $239,748 are not to be considered federal financial assistance for inclusion in the Schedule of Expenditures of Federal Awards. These revenues are reported on the Statement of Revenues, Expenditures, and Changes in Fund Balance Governmental Funds in the General Fund column.4. The District does not draw for indirect administrative expenditures, and has not elected to use the 10% de-minimum cost rate.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.