Audit 409942

Basis of Presentation: The accompanying Schedule of Expenditures of Federal Awards (the “Schedule”) has beenprepared using the accrual basis of accounting and in accordance with Title 2 U.S. Code of FederalRegulations Part 200, Uniform Administrative Requirements, Cost Principles, and AuditRequirements for Federal Awards (“Uniform Guidance”). The purpose of the Schedule is to presenta summary of those activities of the Institution for the year ended December 31, 2025 which havebeen financed by the U.S. Government (“federal awards”). For purposes of the Schedule, federalawards include all federal assistance entered into directly between the federal government and theInstitution and federal funds awarded to the Institution by a prime recipient. Because the Schedulepresents only a selected portion of the activities of the Institution, it is not intended to and does notpresent the financial position, changes in net assets, or cash flows of the Institution. Negativeamounts represent adjustments to amounts reported in prior years in the normal course of business.Full Assistance Listing Numbers and pass-through entity identification numbers are presented whenavailable.

The Institution recovers fringe benefits and indirect costs associated with federal award programspursuant to fixed rates with carryforward provisions negotiated annually with the Office of NavalResearch (“ONR”). The Defense Contract Audit Agency (“DCAA”) has completed an audit of therates used by the Institution through the fiscal year ended December 31, 2024. The 2025 indirectcost recovery rates, which are fixed with carryforward provisions, include the impact of prior yearsettlements. The Institution applies its predetermined approved facilities and administrative ratewhen charging indirect costs to federal awards rather than the 10% or 15% de minimis cost rate, as applicable, as described in Section 200.414 of the Uniform Guidance.