Audit 4197

Title: Note1. Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. The Authority has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: Y Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal and state awards (the Schedule) includes the federal award activity of Cape Fear Public Transportation Authority and is presented on the accrual basis of accounting. The information in this schedule is presented 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) and the State Single Audit Implementation Act. 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. Federal Financial Assistance – The Single Audit Act Amendments of 1996 (Public Law 104-156) and Uniform Guidance define federal financial assistance as grants, loans, loan guarantees, property (including donated surplus property), cooperative agreements, interest subsidies, insurance, food commodities, direct appropriations or other assistance. Direct Payments – Assistance received directly from the Federal government is classified as direct payments on the Schedule. Pass-through Payments – Assistance received in a pass-through relationship from entities other than the Federal government is classified as pass-through payments on the Schedule. Major Programs – The Single Audit Act Amendments of 1996 and Uniform Guidance establish the criteria to be used in defining major programs. Major programs for the Authority were determined using a risk based approach in accordance with Uniform Guidance. Federal Assistance Listing – The Federal Assistance Listing is a government-wide compendium of individual federal programs. Each program included in the Federal Assistance Listing is assigned a fivedigit program identification number, which is reflected in the Schedule. Cluster of Programs – Closely related programs that share common compliance requirements are grouped into clusters of programs. A cluster of programs is considered as one federal program for determining major programs. The Federal Transit Cluster and the Transit Services Program Cluster are clusters administered by the Authority.