[Code of Federal Regulations]

[Title 45, Volume 1]

[Revised as of October 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 45CFR96.31]



[Page 504-505]

 

                        TITLE 45--PUBLIC WELFARE

 

                    SUBTITLE A--DEPARTMENT OF HEALTH

                           AND HUMAN SERVICES

 

PART 96_BLOCK GRANTS--Table of Contents

 

                     Subpart C_Financial Management

 

Sec.  96.31  Audits.



    (a) Basic rule. Grantees and subgrantees are responsible for 

obtaining audits in accordance with the Single Audit Act Amendments of 

1996 (31 U.S.C. 7501-7507) and revised OMB Circular A-133, ``Audits of 

State, Local Governments, and Non-Profit Organizations.'' The audits 

shall be made by an independent auditor in accordance with generally 

accepted Government auditing standards covering financial audits.

    (b) Subgrantees. State or local governments, as those terms are 

defined for purposes of the Single Audit Act Amendments of 1996, that 

provide Federal awards to a subgrantee, expending



[[Page 505]]



$300,000 or more (or other amount as specified by OMB) in Federal awards 

in a fiscal year, shall:

    (1) Determine whether subgrantees have met the audit requirements of 

the Act. Commercial contractors (private for-profit and private and 

governmental organizations) providing goods and services to State and 

local governments are not required to have a single audit performed. 

State and local governments should use their own procedures to ensure 

that the contractor has complied with laws and regulations affecting the 

expenditure of Federal funds;

    (2) Determine whether the subgrantee spent Federal assistance funds 

provided in accordance with applicable laws and regulations. This may be 

accomplished by reviewing an audit of the subgrantee made in accordance 

with the Act or through other means (e.g., program reviews) if the 

subgrantee has not had such an audit;

    (3) Ensure that appropriate corrective action is taken within six 

months after receipt of the audit report in instances of noncompliance 

with Federal laws and regulations;

    (4) Consider whether subgrantee audits necessitate adjustment of the 

grantee's own records; and

    (5) Require each subgrantee to permit independent auditors to have 

access to the records and financial statements.



[62 FR 45963, Aug. 29, 1997]