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Indian River County, Florida <br />Notes to Schedule of Expenditures of Federal Awards <br />and State Projects <br />For the Fiscal Year Ended September 30, 2017 <br />NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES <br />The accounting policies and presentation of the Single Audit Report of Indian River County, Florida, (the <br />"County") have been designed to conform to generally accepted accounting principles as applicable to <br />governmental units, including the reporting and compliance requirements of Title 2 U.S. Code of Federal <br />Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for <br />Federal Awards (Uniform Guidance). <br />A. Reporting Entity <br />The reporting entity consists of Indian River County, the primary government, and each of its component <br />units. The County includes a Schedule of Expenditures of Federal Awards and State Projects in the <br />Compliance Section. <br />B. Basis of Accounting <br />Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts <br />and reported in the financial statements. Basis of accounting relates to the timing of the measurements <br />made, regardless of the measurement focus. The Schedule of Expenditures of Federal Awards and State <br />Projects is maintained on a modified accrual basis of accounting for governmental funds and a full accrual <br />basis for proprietary funds, which is explained further in the notes to the financial statements. Such <br />expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein <br />certain types of expenditures are not allowable or are limited as to reimbursement. <br />C. Program Clusters <br />The Uniform Guidance defines a cluster of programs as a grouping of closely related programs that share <br />common compliance requirements. According to this definition, similar programs deemed to be a cluster <br />of programs are tested accordingly. <br />D. Contingencies <br />Grant revenue amounts received by the County are subject to audit and adjustment by the grantor agencies. <br />Such audits may result in requests for reimbursement by the grantor agency. Any adjustments to grant <br />funding are recorded in the year the adjustment occurs. <br />E. Indirect Cost Rates <br />In the absence of a negotiated federal indirect cost rate, the County has elected to use a de minimis rate of <br />10% of modified total direct costs. <br />230 <br />