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SECTION C <br />(Financial Terms) <br />XXXVI. ADMINISTRATIVE COST CEILING <br />A. Administrative Cost Ceiling. SUBRECIPIENT agrees to keep administrative costs <br />for each program at or below the percentage approved by COUNTY. The approved <br />administrative cost is that percentage most recently approved by COUNTY, whether <br />governed by this year's contract or by a previous year's contract. No variance in <br />excess of the approved administrative percentage will be allowed unless approved by <br />COUNTY in advance and in writing. In no event will COUNTY approve an <br />administrative cost percentage in excess of 15%. <br />B. Exemptions From Administrative Cost Ceiling. At the discretion of COUNTY, <br />programs will be exempt from the prescribed ceiling if any of the following applies: <br />1. The program is 100% administrative, or <br />2. The program is paid monthly under the unit of service reimbursement method of <br />payment, or <br />3. The program is 100% funded from Medical Assistance or another federal source; <br />in such case the administrative expense shall be limited to the requirements of <br />the funding source. <br />XXXVII.AUDITS <br />A. SUBRECIPIENTS that are governmental entities (including public agencies) shall <br />comply with the requirements and standards of OMB Circular A-128, 'Audits of State <br />and Local Governments' implemented at 24 CFR Part 44. <br />B. SUBRECIPIENTS except SUBRECIPIENTS that are governmental entities, shall <br />comply with the requirements and standards of OMB Circular A-133, 'Audits of <br />Institutions of Higher Education and Other Non -Profit Institutions.' <br />C. SUBRECIPIENTS that expend $500,000 or more in total Federal financial assistance <br />in a year are responsible for obtaining an independent audit in accordance with the <br />Single Audit Act of 1984 and OMB Circular A-133 as referenced at 24 CFR 84.26 and <br />85.26. Federal financial assistance means assistance provided directly by a federal <br />agency to a recipient or subrecipient or through a recipient to a subrecipient to carry <br />out a program or activity. Such assistance may be in the form of: grants, loans, <br />contracts, cooperative agreements, loan guarantees, property, interest subsidies, <br />insurance, direct appropriations, and other non-cash assistance. The computation of <br />the total of such assistance includes all Federal funds received by the entire entity, <br />and not just the department or division receiving the CDBG funding. <br />D. Audits must be conducted on an annual basis <br />E. In arranging for audit services, SUBRECIPIENTS must follow the procurement <br />requirements in 24 CFR 85.36 or 24 CFR 84.4148, as applicable. Small audit firms <br />and audits firms owned and controlled by minorities or women must have the <br />maximum practicable opportunity to participate in audit contracts. <br />Page 20 <br />