Title: Basis of Presentation
Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. The financialtransactions are recorded by the Authority in accordance with the terms and conditions of the grants, which areconsistent with accounting principles generally accepted in the United States of America. Such expenditures arerecognized following the cost principles contained in the Uniform Guidance, wherein certain types ofexpenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The accompanying Schedule of Expenditures of Federal Awards (the Schedule") includes the federal awardexpenditures of the Puerto Rico Highways and Transportation Authority (the Authority") for the year ended June30, 2022. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Codeof Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles and Audit Requirementsfor Federal Awards (Uniform Guidance). The Schedule presents only a selected portion of the financial activitiesof the Authority. Therefore, it is not intended to, and does not present the net deficit, changes in net deficit, orcash flows of the Authority.
Title: Federal Assitance Listing Number
Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. The financialtransactions are recorded by the Authority in accordance with the terms and conditions of the grants, which areconsistent with accounting principles generally accepted in the United States of America. Such expenditures arerecognized following the cost principles contained in the Uniform Guidance, wherein certain types ofexpenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Assistance Listing numbers included in this Schedule are determined based on the program name, review ofgrant contract information and the Office of Management and Budgets Catalogue of Federal DomesticAssistance. Pass-through entity identifying numbers are presented where available and applicable.
Title: Relationship to the Financial Statements
Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. The financialtransactions are recorded by the Authority in accordance with the terms and conditions of the grants, which areconsistent with accounting principles generally accepted in the United States of America. Such expenditures arerecognized following the cost principles contained in the Uniform Guidance, wherein certain types ofexpenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
Federal awards revenues and expenses are reported in the Authoritys statement of revenues, expenses, andchanges in net deficit in accordance with standards issued by the Government Accounting Standards Board(GASB) No. 34. Because the Schedule presents only federal activities of the Authority, it is not intended to anddoes not present the financial deficit, assets, liabilities, net deficit, revenues, expenses, changes in net deficit, andcash flows of the Authority, as a whole.
Title: Cluster Programs
Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. The financialtransactions are recorded by the Authority in accordance with the terms and conditions of the grants, which areconsistent with accounting principles generally accepted in the United States of America. Such expenditures arerecognized following the cost principles contained in the Uniform Guidance, wherein certain types ofexpenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Uniform Guidance defines a cluster of programs as a group of closely related programs that share commoncompliance requirements. According to this definition, the Federal Transit Cluster, the Transit Services ProgramsCluster, and the Highway Planning and Construction Cluster were deemed to be cluster programs.
Title: Contingencies
Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. The financialtransactions are recorded by the Authority in accordance with the terms and conditions of the grants, which areconsistent with accounting principles generally accepted in the United States of America. Such expenditures arerecognized following the cost principles contained in the Uniform Guidance, wherein certain types ofexpenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Authority receives funds under various federal award programs and such awards are to be expended inaccordance with the provisions of each award. Compliance with the awards is subject to audit by variousgovernment agencies, which may impose sanctions in the event of non-compliance. Management believes that ithas complied with all aspects of award provisions and the results of adjustments, if any, relating to such auditswould not have a material impact on the programs nor the accompanying Schedule.
Title: Subsequent Events
Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. The financialtransactions are recorded by the Authority in accordance with the terms and conditions of the grants, which areconsistent with accounting principles generally accepted in the United States of America. Such expenditures arerecognized following the cost principles contained in the Uniform Guidance, wherein certain types ofexpenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
On January 11, 2023, the Authority entered into an agreement with the Puerto Rico Department of Housing(PRDH) as a subgrantee of Community Development Block Grant - Mitigation Program (CDBG-MIT) to providefinancial assistance in areas impacted by recent disasters. The funds awarded to the Authority constitute aSubaward of the PRDH. The use of such funds must be in accordance with requirements imposed by federalstatutes, regulations, and the terms and conditions of the PRDH's Federal Award. The total appropriated fundsamounted to approximately $540 million. As of the date of issuance of the financial statements, none of the fundshave been disbursed under the agreement.