[Code of Federal Regulations]
[Title 7, Volume 11]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 7CFR1786.104]

[Page 1105]
 
                          TITLE 7--AGRICULTURE
 
    CHAPTER XVII--RURAL UTILITIES SERVICE, DEPARTMENT OF AGRICULTURE
 
PART 1786--PREPAYMENT OF RUS GUARANTEED AND INSURED LOANS TO ELECTRIC AND TELEPHONE BORROWERS--Table of Contents
 
Subpart E--Discounted Prepayments on RUS Notes in the Event of a Merger 
                    of Certain RUS Electric Borrowers
 
Sec. 1786.104  Loan fund audit.

    RUS shall have the right to audit within 6 months of closing, 
transactions involving the RUS construction fund established and 
maintained by the borrower pursuant to the terms of the RUS Loan 
Agreement and to inspect all books, records, accounts and other 
documents and papers of the borrower. Should RUS determine that the 
borrower has made disbursements of funds advanced pursuant to RUS Notes 
which do not comply with the requirements of the RUS Loan Agreement, the 
borrower shall be required to pay the Government an amount equal to the 
difference between the amount which the borrower prepaid on such RUS 
Notes evidencing RUS loans funds which were improperly disbursed and the 
amount which the borrower would otherwise have been required to return 
to the Government as a result of noncompliance if the borrower had not 
prepaid such RUS Notes. (See 7 CFR part 1721, Post-Loan Policies and 
Procedures for Insured Electric Loans.)