Notes to SEFA
Accounting Policies: A. GENERALThe accompanying Schedule of Expenditures of Federal Awards (the Schedule) presents the activity of all federal awardprograms of the City of Lake City, South Carolina (the City) for the year ended June 30, 2022. Expenditures for federalfinancial assistance awarded directly from the federal agencies, as well as those passed through other government agencies,are included on the Schedule.B. BASIS OF ACCOUNTINGThe accompanying Schedule is presented using the modified accrual basis of accounting, which is described in the notes tothe Citys financial statements.C. RELATIONSHIP TO THE FINANCIAL STATEMENTSFederal award expenditures are reported in the Citys financial statements as expenditures in the General Fund, Water Fund,and Sewer Fund for all federal programs.D. MATCHING COSTSMatching costs, i.e., the non-federal share of certain program costs, are not included in the accompanying Schedule.E. INDIRECT COST RATEThe City has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.F. LOANSDuring the year ended June 30, 2022, the City issued a Bond Anticipation Note (BAN) in the amount of $4,940,000. TheBAN was required by the United States Department of Agriculture (USDA) as interim financing, and the loan was repaidthrough the issuance of a USDA Rural Utilities Service loan in September 2022. Therefore, the proceeds expended during theyear totaling approximately $3,877,000 are included in the Schedule.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.