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§ 7505. —  Regulations. - US § 7505. —  Regulations. - US Code : CHAN ROBLES VIRTUAL LAW LIBRARY

[Laws in effect as of January 7, 2003]
[Document not affected by Public Laws enacted between
  January 7, 2003 and December 19, 2003]
[CITE: 31USC7505]

                       TITLE 31--MONEY AND FINANCE
Sec. 7505. Regulations

    (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.

(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.)


    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.''

                  Section Referred to in Other Sections

    This section is referred to in sections 7502, 7504 of this title; 
title 49 section 47107.


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