[Code of Federal Regulations]

[Title 48, Volume 4]

[Revised as of October 1, 2006]

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

[CITE: 48CFR304.804-70]



[Page 11-12]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                  CHAPTER 3--HEALTH AND HUMAN SERVICES

 

PART 304_ADMINISTRATIVE MATTERS--Table of Contents

 

                 Subpart 304.8_Government Contract Files

 

Sec. 304.804-70  Contract closeout audits.





    (a) Contracting officers shall rely, to the maximum extent possible, 

on non-Federal single audits to close physically completed cost-

reimbursement contracts with colleges and universities, hospitals, non-

profit firms, and



[[Page 12]]



State and local governments. In addition, where appropriate, a sample of 

these contractors may be selected for audit, in accordance with the 

decision-making process set forth in the following paragraph (b).

    (b) Contracting officers shall request contract closeout audits on 

physically completed, cost-reimbursement, for-profit contracts in 

accordance with the following:

    (1) Decisions on: The need for and allocation of contract audit 

resources and services; the selection of contracts or contractors to be 

audited; the identification of the audit agency to perform the audit; 

and the type or scope of closeout audit to be conducted, shall be made 

by the Office of Inspector General (OIG) and Office of Grants and 

Acquisition Management, in consultation with the Department's Contract 

Audit Users Work Group. These decisions shall be based upon the needs of 

the customer, risk analysis, return on investment, and the availability 

of audit resources. When an audit is warranted prior to closing a 

contract, the contracting officer shall submit the audit request to the 

OIG's Office of Audit via the appropriate OPDIV representative on the 

Contract Audit Users Work Group.

    (2) Except where a contracting officer suspects misrepresentation or 

fraud, contract closeout field audits shall not be requested if the cost 

of performance is likely to exceed the potential cost recovery. 

Contracts that are not selected for a field audit may be closed on the 

basis of a desk review, subject to any later on-site audit findings. The 

release executed by the contractor shall contain the following 

statement:



    The Contractor agrees, pursuant to the clause in this contract 

entitled ``Allowable Cost'' or ``Allowable Cost and Fixed Fee'' (as 

appropriate), that the amount of any sustained audit exceptions 

resulting from any audit made after final payment shall be refunded to 

the Government.''