US (United States) Code. Title 31. Subtitle V: General Assistance Administration. Chapter 75

Codificación normativa de EEUU (Estados Unidos) Legislación Federal estadounidense # Money and finance. Requirements for single audits

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-CITE-

31 USC CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-MISC1-

Sec.

7501. Definitions.

7502. Audit requirements; exemptions.

7503. Relation to other audit requirements.

7504. Federal agency responsibilities and relations with

non-Federal entities.

7505. Regulations.

7506. Monitoring responsibilities of the Comptroller

General.

7507. Effective date.

AMENDMENTS

1996 - Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1396,

amended chapter analysis generally, substituting in item 7504

"Federal agency responsibilities and relations with non-Federal

entities" for "Cognizant agency responsibilities" and in item 7507

"Effective date" for "Effective date; report".

-SECREF-

CHAPTER REFERRED TO IN OTHER SECTIONS

This chapter is referred to in sections 3516, 6703 of this title;

title 20 sections 1063a, 1078, 1094, 7426; title 25 sections 450c,

450j-1, 458aaa-5, 2505, 3304, 3414, 4165; title 29 sections 2911,

2912; title 33 sections 1361, 1386; title 42 sections 300x-52, 609,

612, 677, 1437c, 5161, 5656, 8624, 9604, 9611, 9916, 13753; title

49 section 22107.

-End-

-CITE-

31 USC Sec. 7501 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7501. Definitions

-STATUTE-

(a) As used in this chapter, the term -

(1) "Comptroller General" means the Comptroller General of the

United States;

(2) "Director" means the Director of the Office of Management

and Budget;

(3) "Federal agency" has the same meaning as the term "agency"

in section 551(1) of title 5;

(4) "Federal awards" means Federal financial assistance and

Federal cost-reimbursement contracts that non-Federal entities

receive directly from Federal awarding agencies or indirectly

from pass-through entities;

(5) "Federal financial assistance" means assistance that

non-Federal entities receive or administer in the form of grants,

loans, loan guarantees, property, cooperative agreements,

interest subsidies, insurance, food commodities, direct

appropriations, or other assistance, but does not include amounts

received as reimbursement for services rendered to individuals in

accordance with guidance issued by the Director;

(6) "Federal program" means all Federal awards to a non-Federal

entity assigned a single number in the Catalog of Federal

Domestic Assistance or encompassed in a group of numbers or other

category as defined by the Director;

(7) "generally accepted government auditing standards" means

the government auditing standards issued by the Comptroller

General;

(8) "independent auditor" means -

(A) an external State or local government auditor who meets

the independence standards included in generally accepted

government auditing standards; or

(B) a public accountant who meets such independence

standards;

(9) "Indian tribe" means any Indian tribe, band, nation, or

other organized group or community, including any Alaskan Native

village or regional or village corporation (as defined in, or

established under, the Alaskan Native Claims Settlement Act) that

is recognized by the United States as eligible for the special

programs and services provided by the United States to Indians

because of their status as Indians;

(10) "internal controls" means a process, effected by an

entity's management and other personnel, designed to provide

reasonable assurance regarding the achievement of objectives in

the following categories:

(A) Effectiveness and efficiency of operations.(!1)

(B) Reliability of financial reporting.(!1)

(C) Compliance with applicable laws and regulations;

(11) "local government" means any unit of local government

within a State, including a county, borough, municipality, city,

town, township, parish, local public authority, special district,

school district, intrastate district, council of governments, any

other instrumentality of local government and, in accordance with

guidelines issued by the Director, a group of local governments;

(12) "major program" means a Federal program identified in

accordance with risk-based criteria prescribed by the Director

under this chapter, subject to the limitations described under

subsection (b);

(13) "non-Federal entity" means a State, local government, or

nonprofit organization;

(14) "nonprofit organization" means any corporation, trust,

association, cooperative, or other organization that -

(A) is operated primarily for scientific, educational,

service, charitable, or similar purposes in the public

interest;

(B) is not organized primarily for profit; and

(C) uses net proceeds to maintain, improve, or expand the

operations of the organization;

(15) "pass-through entity" means a non-Federal entity that

provides Federal awards to a subrecipient to carry out a Federal

program;

(16) "program-specific audit" means an audit of one Federal

program;

(17) "recipient" means a non-Federal entity that receives

awards directly from a Federal agency to carry out a Federal

program;

(18) "single audit" means an audit, as described under section

7502(d), of a non-Federal entity that includes the entity's

financial statements and Federal awards;

(19) "State" means any State of the United States, the District

of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands,

Guam, American Samoa, the Commonwealth of the Northern Mariana

Islands, and the Trust Territory of the Pacific Islands, any

instrumentality thereof, any multi-State, regional, or interstate

entity which has governmental functions, and any Indian tribe;

and

(20) "subrecipient" means a non-Federal entity that receives

Federal awards through another non-Federal entity to carry out a

Federal program, but does not include an individual who receives

financial assistance through such awards.

(b) In prescribing risk-based program selection criteria for

major programs, the Director shall not require more programs to be

identified as major for a particular non-Federal entity, except as

prescribed under subsection (c) or as provided under subsection

(d), than would be identified if the major programs were defined as

any program for which total expenditures of Federal awards by the

non-Federal entity during the applicable year exceed -

(1) the larger of $30,000,000 or 0.15 percent of the

non-Federal entity's total Federal expenditures, in the case of a

non-Federal entity for which such total expenditures for all

programs exceed $10,000,000,000;

(2) the larger of $3,000,000, or 0.30 percent of the

non-Federal entity's total Federal expenditures, in the case of a

non-Federal entity for which such total expenditures for all

programs exceed $100,000,000 but are less than or equal to

$10,000,000,000; or

(3) the larger of $300,000, or 3 percent of such total Federal

expenditures for all programs, in the case of a non-Federal

entity for which such total expenditures for all programs equal

or exceed $300,000 but are less than or equal to $100,000,000.

(c) When the total expenditures of a non-Federal entity's major

programs are less than 50 percent of the non-Federal entity's total

expenditures of all Federal awards (or such lower percentage as

specified by the Director), the auditor shall select and test

additional programs as major programs as necessary to achieve audit

coverage of at least 50 percent of Federal expenditures by the

non-Federal entity (or such lower percentage as specified by the

Director), in accordance with guidance issued by the Director.

(d) Loan or loan guarantee programs, as specified by the

Director, shall not be subject to the application of subsection

(b).

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2327;

amended Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1396.)

-REFTEXT-

REFERENCES IN TEXT

The Alaskan Native Claims Settlement Act, referred to in subsec.

(a)(9), probably means the Alaska Native Claims Settlement Act,

Pub. L. 92-203, Dec. 18, 1971, 85 Stat. 688, as amended, which is

classified generally to chapter 33 (Sec. 1601 et seq.) of Title 43,

Public Lands. For complete classification of this Act to the Code,

see Short Title note set out under section 1601 of Title 43 and

Tables.

-MISC1-

AMENDMENTS

1996 - Pub. L. 104-156 reenacted section catchline without change

and amended text generally, substituting present provisions for

similar provisions defining terms used in this chapter.

SHORT TITLE OF 1996 AMENDMENT

Section 1(a) of Pub. L. 104-156 provided that: "This Act

[amending this chapter and enacting provisions set out as notes

below] may be cited as the 'Single Audit Act Amendments of 1996'."

SHORT TITLE

Section 1(a) of Pub. L. 98-502 provided that: "This Act [enacting

this chapter] may be cited as the 'Single Audit Act of 1984'."

-TRANS-

TERMINATION OF TRUST TERRITORY OF THE PACIFIC ISLANDS

For termination of Trust Territory of the Pacific Islands, see

note set out preceding section 1681 of Title 48, Territories and

Insular Possessions.

-MISC2-

TRANSITIONAL APPLICATION

Section 3 of Pub. L. 104-156 provided that: "Subject to section

7507 of title 31, United States Code (as amended by section 2 of

this Act) the provisions of chapter 75 of such title (before

amendment by section 2 of this Act) shall continue to apply to any

State or local government with respect to any of its fiscal years

beginning before July 1, 1996."

CONGRESSIONAL STATEMENT OF PURPOSE

Section 1(b) of Pub. L. 104-156 provided that: "The purposes of

this Act [see Short Title of 1996 Amendment note above] are to -

"(1) promote sound financial management, including effective

internal controls, with respect to Federal awards administered by

non-Federal entities;

"(2) establish uniform requirements for audits of Federal

awards administered by non-Federal entities;

"(3) promote the efficient and effective use of audit

resources;

"(4) reduce burdens on State and local governments, Indian

tribes, and nonprofit organizations; and

"(5) ensure that Federal departments and agencies, to the

maximum extent practicable, rely upon and use audit work done

pursuant to chapter 75 of title 31, United States Code (as

amended by this Act)."

Section 1(b) of Pub. L. 98-502 provided that: "It is the purpose

of this Act [enacting this chapter] -

"(1) to improve the financial management of State and local

governments with respect to Federal financial assistance

programs;

"(2) to establish uniform requirements for audits of Federal

financial assistance provided to State and local governments;

"(3) to promote the efficient and effective use of audit

resources; and

"(4) to ensure that Federal departments and agencies, to the

maximum extent practicable, rely upon and use audit work done

pursuant to chapter 75 of title 31, United States Code (as added

by this Act)."

TENNESSEE VALLEY AUTHORITY AUDITS UNAFFECTED BY SINGLE AUDIT

REQUIREMENTS

Section 2(b) of Pub. L. 98-502 provided that: "The provisions of

this Act [enacting this chapter] shall not diminish or otherwise

affect the authority of the Tennessee Valley Authority to conduct

its own audits of any matter involving funds disbursed by the

Tennessee Valley Authority."

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in title 49 section 47107.

-FOOTNOTE-

(!1) So in original.

-End-

-CITE-

31 USC Sec. 7502 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7502. Audit requirements; exemptions

-STATUTE-

(a)(1)(A) Each non-Federal entity that expends a total amount of

Federal awards equal to or in excess of $300,000 or such other

amount specified by the Director under subsection (a)(3) in any

fiscal year of such non-Federal entity shall have either a single

audit or a program-specific audit made for such fiscal year in

accordance with the requirements of this chapter.

(B) Each such non-Federal entity that expends Federal awards

under more than one Federal program shall undergo a single audit in

accordance with the requirements of subsections (b) through (i) of

this section and guidance issued by the Director under section

7505.

(C) Each such non-Federal entity that expends awards under only

one Federal program and is not subject to laws, regulations, or

Federal award agreements that require a financial statement audit

of the non-Federal entity, may elect to have a program-specific

audit conducted in accordance with applicable provisions of this

section and guidance issued by the Director under section 7505.

(2)(A) Each non-Federal entity that expends a total amount of

Federal awards of less than $300,000 or such other amount specified

by the Director under subsection (a)(3) in any fiscal year of such

entity, shall be exempt for such fiscal year from compliance with -

(i) the audit requirements of this chapter; and

(ii) any applicable requirements concerning financial audits

contained in Federal statutes and regulations governing programs

under which such Federal awards are provided to that non-Federal

entity.

(B) The provisions of subparagraph (A)(ii) of this paragraph

shall not exempt a non-Federal entity from compliance with any

provision of a Federal statute or regulation that requires such

non-Federal entity to maintain records concerning Federal awards

provided to such non-Federal entity or that permits a Federal

agency, pass-through entity, or the Comptroller General access to

such records.

(3) Every 2 years, the Director shall review the amount for

requiring audits prescribed under paragraph (1)(A) and may adjust

such dollar amount consistent with the purposes of this chapter,

provided the Director does not make such adjustments below

$300,000.

(b)(1) Except as provided in paragraphs (2) and (3), audits

conducted pursuant to this chapter shall be conducted annually.

(2) A State or local government that is required by constitution

or statute, in effect on January 1, 1987, to undergo its audits

less frequently than annually, is permitted to undergo its audits

pursuant to this chapter biennially. Audits conducted biennially

under the provisions of this paragraph shall cover both years

within the biennial period.

(3) Any nonprofit organization that had biennial audits for all

biennial periods ending between July 1, 1992, and January 1, 1995,

is permitted to undergo its audits pursuant to this chapter

biennially. Audits conducted biennially under the provisions of

this paragraph shall cover both years within the biennial period.

(c) Each audit conducted pursuant to subsection (a) shall be

conducted by an independent auditor in accordance with generally

accepted government auditing standards, except that, for the

purposes of this chapter, performance audits shall not be required

except as authorized by the Director.

(d) Each single audit conducted pursuant to subsection (a) for

any fiscal year shall -

(1) cover the operations of the entire non-Federal entity; or

(2) at the option of such non-Federal entity such audit shall

include a series of audits that cover departments, agencies, and

other organizational units which expended or otherwise

administered Federal awards during such fiscal year provided that

each such audit shall encompass the financial statements and

schedule of expenditures of Federal awards for each such

department, agency, and organizational unit, which shall be

considered to be a non-Federal entity.

(e) The auditor shall -

(1) determine whether the financial statements are presented

fairly in all material respects in conformity with generally

accepted accounting principles;

(2) determine whether the schedule of expenditures of Federal

awards is presented fairly in all material respects in relation

to the financial statements taken as a whole;

(3) with respect to internal controls pertaining to the

compliance requirements for each major program -

(A) obtain an understanding of such internal controls;

(B) assess control risk; and

(C) perform tests of controls unless the controls are deemed

to be ineffective; and

(4) determine whether the non-Federal entity has complied with

the provisions of laws, regulations, and contracts or grants

pertaining to Federal awards that have a direct and material

effect on each major program.

(f)(1) Each Federal agency which provides Federal awards to a

recipient shall -

(A) provide such recipient the program names (and any

identifying numbers) from which such awards are derived, and the

Federal requirements which govern the use of such awards and the

requirements of this chapter; and

(B) review the audit of a recipient as necessary to determine

whether prompt and appropriate corrective action has been taken

with respect to audit findings, as defined by the Director,

pertaining to Federal awards provided to the recipient by the

Federal agency.

(2) Each pass-through entity shall -

(A) provide such subrecipient the program names (and any

identifying numbers) from which such assistance is derived, and

the Federal requirements which govern the use of such awards and

the requirements of this chapter;

(B) monitor the subrecipient's use of Federal awards through

site visits, limited scope audits, or other means;

(C) review the audit of a subrecipient as necessary to

determine whether prompt and appropriate corrective action has

been taken with respect to audit findings, as defined by the

Director, pertaining to Federal awards provided to the

subrecipient by the pass-through entity; and

(D) require each of its subrecipients of Federal awards to

permit, as a condition of receiving Federal awards, the

independent auditor of the pass-through entity to have such

access to the subrecipient's records and financial statements as

may be necessary for the pass-through entity to comply with this

chapter.

(g)(1) The auditor shall report on the results of any audit

conducted pursuant to this section, in accordance with guidance

issued by the Director.

(2) When reporting on any single audit, the auditor shall include

a summary of the auditor's results regarding the non-Federal

entity's financial statements, internal controls, and compliance

with laws and regulations.

(h) The non-Federal entity shall transmit the reporting package,

which shall include the non-Federal entity's financial statements,

schedule of expenditures of Federal awards, corrective action plan

defined under subsection (i), and auditor's reports developed

pursuant to this section, to a Federal clearinghouse designated by

the Director, and make it available for public inspection within

the earlier of -

(1) 30 days after receipt of the auditor's report; or

(2)(A) for a transition period of at least 2 years after the

effective date of the Single Audit Act Amendments of 1996, as

established by the Director, 13 months after the end of the

period audited; or

(B) for fiscal years beginning after the period specified in

subparagraph (A), 9 months after the end of the period audited,

or within a longer timeframe authorized by the Federal agency,

determined under criteria issued under section 7504, when the

9-month timeframe would place an undue burden on the non-Federal

entity.

(i) If an audit conducted pursuant to this section discloses any

audit findings, as defined by the Director, including material

noncompliance with individual compliance requirements for a major

program by, or reportable conditions in the internal controls of,

the non-Federal entity with respect to the matters described in

subsection (e), the non-Federal entity shall submit to Federal

officials designated by the Director, a plan for corrective action

to eliminate such audit findings or reportable conditions or a

statement describing the reasons that corrective action is not

necessary. Such plan shall be consistent with the audit resolution

standard promulgated by the Comptroller General (as part of the

standards for internal controls in the Federal Government) pursuant

to section 3512(c).

(j) The Director may authorize pilot projects to test alternative

methods of achieving the purposes of this chapter. Such pilot

projects may begin only after consultation with the Chair and

Ranking Minority Member of the Committee on Governmental Affairs of

the Senate and the Chair and Ranking Minority Member of the

Committee on Government Reform and Oversight of the House of

Representatives.

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2329;

amended Pub. L. 103-272, Sec. 4(f)(1)(W), July 5, 1994, 108 Stat.

1363; Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1399.)

-REFTEXT-

REFERENCES IN TEXT

The effective date of the Single Audit Act Amendments of 1996,

referred to in subsec. (h)(2)(A), is the effective date of Pub. L.

104-156, which is classified generally to this chapter. See section

7507 of this title.

-MISC1-

AMENDMENTS

1996 - Pub. L. 104-156 reenacted section catchline without change

and amended text generally, substituting present provisions for

similar provisions relating to audit requirements and exemptions

from such requirements for State and local governments receiving

Federal financial assistance of $100,000 or more in any fiscal year

and requiring audits to be conducted annually in most instances, to

cover entirety of government operations, for reports to be made on

audits in specified time period, and for appropriate corrective

action plans to be submitted to Federal officials for any material

State or local noncompliance with Federal laws and regulations.

1994 - Subsec. (b)(2). Pub. L. 103-272, Sec. 4(f)(1)(W),

substituted "October 19, 1984" for "the date of enactment of this

chapter" in subpar. (A) and for "such date" in subpar. (B).

Subsec. (d)(5), (6). Pub. L. 103-272, Sec. 4(f)(1)(W)(iii),

redesignated par. (6) as (5) and struck out former par. (5) which

read as follows: "Each State or local government which, in any

fiscal year of such government, receives directly from the

Department of the Treasury a total of $25,000 or more under chapter

67 of this title (relating to general revenue sharing) and which is

required to conduct an audit pursuant to this chapter for such

fiscal year shall not have the option provided by paragraph (1)(A)

for such fiscal year."

Subsec. (g). Pub. L. 103-272, Sec. 4(f)(1)(W)(iv), substituted

"section 3512(c)" for "section 3512(b)".

-CHANGE-

CHANGE OF NAME

Committee on Government Reform and Oversight of House of

Representatives changed to Committee on Government Reform of House

of Representatives by House Resolution No. 5, One Hundred Sixth

Congress, Jan. 6, 1999.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 7501, 7503, 7504, 7505 of

this title; title 42 section 300ff-75a; title 49 section 47107.

-End-

-CITE-

31 USC Sec. 7503 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7503. Relation to other audit requirements

-STATUTE-

(a) An audit conducted in accordance with this chapter shall be

in lieu of any financial audit of Federal awards which a

non-Federal entity is required to undergo under any other Federal

law or regulation. To the extent that such audit provides a Federal

agency with the information it requires to carry out its

responsibilities under Federal law or regulation, a Federal agency

shall rely upon and use that information.

(b) Notwithstanding subsection (a), a Federal agency may conduct

or arrange for additional audits which are necessary to carry out

its responsibilities under Federal law or regulation. The

provisions of this chapter do not authorize any non-Federal entity

(or subrecipient thereof) to constrain, in any manner, such agency

from carrying out or arranging for such additional audits, except

that the Federal agency shall plan such audits to not be

duplicative of other audits of Federal awards.

(c) The provisions of this chapter do not limit the authority of

Federal agencies to conduct, or arrange for the conduct of, audits

and evaluations of Federal awards, nor limit the authority of any

Federal agency Inspector General or other Federal official.

(d) Subsection (a) shall apply to a non-Federal entity which

undergoes an audit in accordance with this chapter even though it

is not required by section 7502(a) to have such an audit.

(e) A Federal agency that provides Federal awards and conducts or

arranges for audits of non-Federal entities receiving such awards

that are in addition to the audits of non-Federal entities

conducted pursuant to this chapter shall, consistent with other

applicable law, arrange for funding the full cost of such

additional audits. Any such additional audits shall be coordinated

with the Federal agency determined under criteria issued under

section 7504 to preclude duplication of the audits conducted

pursuant to this chapter or other additional audits.

(f) Upon request by a Federal agency or the Comptroller General,

any independent auditor conducting an audit pursuant to this

chapter shall make the auditor's working papers available to the

Federal agency or the Comptroller General as part of a quality

review, to resolve audit findings, or to carry out oversight

responsibilities consistent with the purposes of this chapter. Such

access to auditor's working papers shall include the right to

obtain copies.

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2332;

amended Pub. L. 103-272, Sec. 4(f)(1)(X), July 5, 1994, 108 Stat.

1363; Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1401.)

-MISC1-

AMENDMENTS

1996 - Pub. L. 104-156 reenacted section catchline without change

and amended text generally, substituting present provisions for

similar provisions relating to other audit requirements, including

compliance and evaluation audits of individual Federal assistance

programs, audits by State and local governmental entities, and

provisions requiring Federal agencies to arrange for funding cost

of conducting audits that are in addition to audits required by

this chapter.

1994 - Subsec. (a). Pub. L. 103-272 substituted "extent" for

"extend" in second sentence.

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in title 49 section 47107.

-End-

-CITE-

31 USC Sec. 7504 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7504. Federal agency responsibilities and relations with

non-Federal entities

-STATUTE-

(a) Each Federal agency shall, in accordance with guidance issued

by the Director under section 7505, with regard to Federal awards

provided by the agency -

(1) monitor non-Federal entity use of Federal awards, and

(2) assess the quality of audits conducted under this chapter

for audits of entities for which the agency is the single Federal

agency determined under subsection (b).

(b) Each non-Federal entity shall have a single Federal agency,

determined in accordance with criteria established by the Director,

to provide the non-Federal entity with technical assistance and

assist with implementation of this chapter.

(c) The Director shall designate a Federal clearinghouse to -

(1) receive copies of all reporting packages developed in

accordance with this chapter;

(2) identify recipients that expend $300,000 or more in Federal

awards or such other amount specified by the Director under

section 7502(a)(3) during the recipient's fiscal year but did not

undergo an audit in accordance with this chapter; and

(3) perform analyses to assist the Director in carrying out

responsibilities under this chapter.

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2333;

amended Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1402.)

-MISC1-

AMENDMENTS

1996 - Pub. L. 104-156 substituted "Federal agency

responsibilities and relations with non-Federal entities" for

"Cognizant agency responsibilities" in section catchline and

amended text generally. Prior to amendment, text read as follows:

"(a) The Director shall designate cognizant agencies for audits

conducted pursuant to this chapter.

"(b) A cognizant agency shall -

"(1) ensure that audits are made in a timely manner and in

accordance with the requirements of this chapter;

"(2) ensure that the audit reports and corrective action plans

made pursuant to section 7502 of this title are transmitted to

the appropriate Federal officials; and

"(3)(A) coordinate, to the extent practicable, audits done by

or under contract with Federal agencies that are in addition to

the audits conducted pursuant to this chapter; and (B) ensure

that such additional audits build upon the audits conducted

pursuant to this chapter."

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 7502, 7503 of this title;

title 49 section 47107.

-End-

-CITE-

31 USC Sec. 7505 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7505. Regulations

-STATUTE-

(a) The Director, after consultation with the Comptroller

General, and appropriate officials from Federal, State, and local

governments and nonprofit organizations shall prescribe guidance to

implement this chapter. Each Federal agency shall promulgate such

amendments to its regulations as may be necessary to conform such

regulations to the requirements of this chapter and of such

guidance.

(b)(1) The guidance prescribed pursuant to subsection (a) shall

include criteria for determining the appropriate charges to Federal

awards for the cost of audits. Such criteria shall prohibit a

non-Federal entity from charging to any Federal awards -

(A) the cost of any audit which is -

(i) not conducted in accordance with this chapter; or

(ii) conducted in accordance with this chapter when

expenditures of Federal awards are less than amounts cited in

section 7502(a)(1)(A) or specified by the Director under

section 7502(a)(3), except that the Director may allow the cost

of limited scope audits to monitor subrecipients in accordance

with section 7502(f)(2)(B); and

(B) more than a reasonably proportionate share of the cost of

any such audit that is conducted in accordance with this chapter.

(2) The criteria prescribed pursuant to paragraph (1) shall not,

in the absence of documentation demonstrating a higher actual cost,

permit the percentage of the cost of audits performed pursuant to

this chapter charged to Federal awards, to exceed the ratio of

total Federal awards expended by such non-Federal entity during the

applicable fiscal year or years, to such non-Federal entity's total

expenditures during such fiscal year or years.

(c) Such guidance shall include such provisions as may be

necessary to ensure that small business concerns, qualified HUBZone

small business concerns, and business concerns owned and controlled

by socially and economically disadvantaged individuals will have

the opportunity to participate in the performance of contracts

awarded to fulfill the audit requirements of this chapter.

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2333;

amended Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1403; Pub.

L. 105-135, title VI, Sec. 604(e)(3), Dec. 2, 1997, 111 Stat.

2634.)

-MISC1-

AMENDMENTS

1997 - Subsec. (c). Pub. L. 105-135 substituted "small business

concerns, qualified HUBZone small business concerns, and" for

"small business concerns and".

1996 - Pub. L. 104-156 reenacted section catchline without change

and amended text generally, substituting present provisions for

similar provisions relating to regulations, including

implementation guidelines for regulations, criteria for determining

appropriate charges to programs of Federal financial assistance for

cost of audits, and guidelines to ensure that small business

concerns and business concerns owned and controlled by socially and

economically disadvantaged individuals have opportunity to

participate in contracts awarded to fulfill audit requirements of

this chapter.

EFFECTIVE DATE OF 1997 AMENDMENT

Amendment by Pub. L. 105-135 effective Oct. 1, 1997, see section

3 of Pub. L. 105-135, set out as a note under section 631 of Title

15, Commerce and Trade.

GUIDELINES FOR ACCEPTANCE OF AUDITS BY STATE AND LOCAL GOVERNMENTS

RECEIVING FEDERAL ASSISTANCE

Pub. L. 104-201, div. A, title VIII, Sec. 808(c), Sept. 23, 1996,

110 Stat. 2607, provided that: "The Director of the Office of

Management and Budget shall issue guidelines to ensure that an

audit of indirect costs performed by the Federal Government is

accepted by State and local governments that receive Federal funds

under contracts, grants, or other Federal assistance programs."

-SECREF-

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 7502, 7504 of this title;

title 49 section 47107.

-End-

-CITE-

31 USC Sec. 7506 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7506. Monitoring responsibilities of the Comptroller General

-STATUTE-

(a) The Comptroller General shall review provisions requiring

financial audits of non-Federal entities that receive Federal

awards that are contained in bills and resolutions reported by the

committees of the Senate and the House of Representatives.

(b) If the Comptroller General determines that a bill or

resolution contains provisions that are inconsistent with the

requirements of this chapter, the Comptroller General shall, at the

earliest practicable date, notify in writing -

(1) the committee that reported such bill or resolution; and

(2)(A) the Committee on Governmental Affairs of the Senate (in

the case of a bill or resolution reported by a committee of the

Senate); or

(B) the Committee on Government Reform and Oversight of the

House of Representatives (in the case of a bill or resolution

reported by a committee of the House of Representatives).

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2333;

amended Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1403.)

-MISC1-

AMENDMENTS

1996 - Pub. L. 104-156 reenacted section catchline without change

and amended text generally. Prior to amendment, text read as

follows: "The Comptroller General shall review provisions requiring

financial or financial and compliance audits of recipients of

Federal assistance that are contained in bills and resolutions

reported by the committees of the Senate and the House of

Representatives. If the Comptroller General determines that a bill

or resolution contains provisions that are inconsistent with the

requirements of this chapter, the Comptroller General shall, at the

earliest practicable date, notify in writing -

"(1) the committee that reported such bill or resolution; and

"(2)(A) the Committee on Governmental Affairs of the Senate (in

the case of a bill or resolution reported by a committee of the

Senate); or

"(B) the Committee on Government Operations of the House of

Representatives (in the case of a bill or resolution reported by

a committee of the House of Representatives)."

-CHANGE-

CHANGE OF NAME

Committee on Government Reform and Oversight of House of

Representatives changed to Committee on Government Reform of House

of Representatives by House Resolution No. 5, One Hundred Sixth

Congress, Jan. 6, 1999.

-End-

-CITE-

31 USC Sec. 7507 01/06/03

-EXPCITE-

TITLE 31 - MONEY AND FINANCE

SUBTITLE V - GENERAL ASSISTANCE ADMINISTRATION

CHAPTER 75 - REQUIREMENTS FOR SINGLE AUDITS

-HEAD-

Sec. 7507. Effective date

-STATUTE-

This chapter shall apply to any non-Federal entity with respect

to any of its fiscal years which begin after June 30, 1996.

-SOURCE-

(Added Pub. L. 98-502, Sec. 2(a), Oct. 19, 1984, 98 Stat. 2334;

amended Pub. L. 104-156, Sec. 2, July 5, 1996, 110 Stat. 1404.)

-MISC1-

AMENDMENTS

1996 - Pub. L. 104-156 struck out "; report" after "Effective

date" in section catchline and amended text generally. Prior to

amendment, text read as follows:

"(a) This chapter shall apply to any State or local government

with respect to any of its fiscal years which begin after December

31, 1984.

"(b) The Director, on or before May 1, 1987, and annually

thereafter, shall submit to each House of Congress a report on

operations under this chapter. Each such report shall specifically

identify each Federal agency or State or local government which is

failing to comply with this chapter."

-End-