Notes to SEFA
Title: Relationship to the Financial Statements
Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis of accounting, which is described in Note 1 to the Towns basic financial statements for the year ended May 31, 2022. 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.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
During the year ended May 31, 2021, the Town incurred eligible expenditures for FEMA disaster reimbursements in the amount of $1,084,791 for Hurricane Laura and Hurricane Delta, however, the project worksheets (PW) had not yet been approved. Therefore, the FEMA disaster reimbursements and eligible expenditures that were incurred were required to be reported in the financial statements but not in the Schedule of Expenditures of Federal Awards on May 31, 2021. The PW for these projects were approved during the year ended May 31, 2022 and will be included in the Schedule of Expenditures of Federal Awards.
Title: General
Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis of accounting, which is described in Note 1 to the Towns basic financial statements for the year ended May 31, 2022. 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.
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 award activity of the Town of Welsh (the Town) under programs of the federal government for the year ended May 31, 2022. 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). Because the Schedule presents only a selected portion of the operations of the Town, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Town.