[Code of Federal Regulations]
[Title 7, Volume 4]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR215.13]

[Page 78-79]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER II--FOOD AND NUTRITION SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 215--SPECIAL MILK PROGRAM FOR CHILDREN--Table of Contents
 
Sec. 215.13  Management evaluations and audits.

    (a) State agencies and school food authorities shall comply with the 
requirements of part 3015 of this title concerning the audit 
requirements for recipients and subrecipients of the Department's 
financial assistance.
    (b) These requirements call for organization-wide financial and 
compliance audits to ascertain whether financial operations are 
conducted properly; financial statements are presented fairly; 
recipients and subrecipients comply with the laws and regulations that 
affect the expenditures of Federal funds; recipients and subrecipients 
have established procedures to meet the objectives of federally assisted 
programs; and recipients and subrecipients are providing accurate and 
reliable information concerning grant funds. States and school food 
authorities shall use their own procedures to arrange for and prescribe 
the scope of independent audits, provided that such audits comply with 
the requirements set forth in part 3015 of this title.
    (c) Each State agency shall provide FNS with full opportunity to 
conduct management evaluations (including visits to schools and child-
care institutions) of any operations of the State agency under the 
Program and shall provide OA with full opportunity to conduct audits 
(including visits to schools and child-care institutions) of all 
operations of the State agency under the Program. Each State agency 
shall make available its records, including records of the receipt and 
expenditure of funds under the Program, upon a reasonable request by FNS 
or OA. OA shall also have the right to make audits of the records and 
operations of any school or child-care institution.
    (d) In conducting management evaluations, reviews or audits for any 
fiscal year, the State agency, FNS, or OIG may disregard any overpayment 
if the total overpayment does not exceed $600 or, in the case of State 
agency claims in State administered Programs, it does not exceed the 
amount established under State law, regulations or procedure as a 
minimum amount for which claim will be made for State losses but not to 
exceed $600. However, no overpayment is to be disregarded where

[[Page 79]]

there is substantial evidence of violations of criminal law or civil 
fraud statutes.

(Secs. 805 and 819, Pub. L. 97-35, 95 Stat. 521-535 (42 U.S.C. 1773); 
sec. 812, Pub. L. 97-35, 95 Stat. 521-535 (42 U.S.C. 1759a))

[Amdt. 14, 41 FR 31175, July 27, 1976, as amended at 43 FR 58925, Dec. 
22, 1978; Amdt. 23, 47 FR 14135, Apr. 2, 1982; Amdt. 25, 47 FR 18564, 
Apr. 30, 1982; Amdt. 36, 54 FR 2990, Jan. 23, 1989; 57 FR 38586, Aug. 
26, 1992; 59 FR 1894, Jan. 13, 1994; 64 FR 50742, Sept. 20, 1999]