Audit 41843

Accounting Policies: Note 1: REPORTING ENTITY AND SCOPE OF AUDIT PURSUANT TO THE UNIFORM GUIDANCEThe Reporting entity for the schedule of expenditures of federal awards includes the City of Gadsden,Alabama (the City). The Citys discretely presented component units: the Gadsden Board of Education,Gadsden Airport Authority of the City of Gadsden are not included.The U. S. Department of Housing and Urban Development has been designated as the Citys cognizantagency for the "Single-Audit.Note 2: FISCAL PERIOD AUDITEDSingle Audit testing procedures were performed for program transactions occurring during the fiscal yearended September 30, 2022.Note 3: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESBasis of PresentationThe Schedule of Expenditures of Federal Awards has been prepared on the modified accrual basis ofaccounting. Federal grant revenues are recorded for financial reporting purposes when the City has metthe qualifications for the respective grants. Encumbrances for purchase orders and contracts are notrecorded as expenditures because the liability has not been incurred for goods received or servicesrendered; however, these encumbrances (if any) are reserved in the fund balances of the governmentalfunds. Costs incurred in programs partially funded by Federal grants are applied against grant funds tothe extent of revenue available when they properly apply to the grant, except as described below. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate.