ance is administered by the Community Services Administration.

§ 1068.30-2 Policy.

(a) Allowable Costs. CSA permits the expenditure of grant funds for the payment of membership dues and other related expenses to professional organizations whose purposes are closely related to those of the grant and/or in furtherance of the objectives of the Economic Opportunity Act and within the limitations described below:

(1) Grantees are limited to the purchase of a single agency membership in any appropriate organization(s) which are found acceptable by CSA whether at the state, regional, or national level. (Note: This does not limit the number of organizations to which a grantee may belong but rather limits the number of memberships which it may purchase in any one organization.)

(2) Memberships may not be purchased in the name of any delegate agency or individual.

(3) Expenditures of grant funds for costs incurred through attendance at events sponsored by professional organizations, including travel and per diem, must be in compliance with the relevant CSA regulations. (Where specific CSA regulations or guidelines do not exist, for example for registration costs, grantees will be guided by costs charged by comparable organizations. Excessive costs will be disallowed.)

[42 FR 63171, Dec. 15, 1977, as amended at 45 FR 64940, Oct. 1, 1980]

§ 1068.30-3 Criteria for review.

(a) Review Criteria. If a CSA funded organization proposes to expend CSA funds for membership in a state, regional or national association, it will assure that:

(1) Its purposes are closely related to that of the grant and to furtherance of the objectives of the EOA;

(2) The membership benefits the program/agency and not merely an individual;

(3) The organization has not been found to be unacceptable by CSA (see (b) below); and

ance is administered by the Community Services Administration.

§ 1068.30-2 Policy.

(a) Allowable Costs. CSA permits the expenditure of grant funds for the payment of membership dues and other related expenses to professional organizations whose purposes are closely related to those of the grant and/or in furtherance of the objectives of the Economic Opportunity Act and within the limitations described below:

(1) Grantees are limited to the purchase of a single agency membership in any appropriate organization(s) which are found acceptable by CSA whether at the state, regional, or national level. (Note: This does not limit the number of organizations to which a grantee may belong but rather limits the number of memberships which it may purchase in any one organization.)

(2) Memberships may not be purchased in the name of any delegate agency or individual.

(3) Expenditures of grant funds for costs incurred through attendance at events sponsored by professional organizations, including travel and per diem, must be in compliance with the relevant CSA regulations. (Where specific CSA regulations or guidelines do not exist, for example for registration costs, grantees will be guided by costs charged by comparable organizations. Excessive costs will be disallowed.)

[42 FR 63171, Dec. 15, 1977, as amended at 45 FR 64940, Oct. 1, 1980]

§ 1068.30-3 Criteria for review.

(a) Review Criteria. If a CSA funded organization proposes to expend CSA funds for membership in a state, regional or national association, it will assure that:

(1) Its purposes are closely related to that of the grant and to furtherance of the objectives of the EOA;

(2) The membership benefits the program/agency and not merely an individual;

(3) The organization has not been found to be unacceptable by CSA (see (b) below); and

(4) The professional organization to which membership dues will be paid is not providing funds or other support, directly or indirectly, to an organization or organizations which CSA has determined is not an appropriate recipient of membership dues derived from grant funds. (See (b) below.)

(b) Determination of acceptability. (1) CSA will make a determination as to the acceptability of organizations as recipients of membership dues where warranted. The determination may be based on the findings of audits conducted by CSA or undertaken by a third party on its behalf or other Sources of information/data which will enable CSA to make the following determinations:

(i) That the activities of the organization are in furtherance of the objectives of the EOA, and

(ii) That the organization has an acceptable track record based on, where appropriate, such factors as:

(A) Administrative capability;

(B) Soundness of its fiscal system; (C) Availability and acceptability of its audits;

(D) Procedures for and conduct of elections;

(E) Federal access to records; (F) Clear and concise recordkeeping, including travel expenditures.

(2) CSA intends to publish specific criteria and procedures for use by Headquarters and Regional Offices in undertaking audits.

(3) The list of unacceptable organizations will be published as a revision to this subpart and to Attachment A of Instruction 6803-6 whenever there are changes to the list.

the

(4) Attachment A contains name(s) of organizations currently found to be unacceptable. All other national, State and regional organizations are determined to be acceptable at this time if they are in conformance with the criteria outlined in § 1068.303(a). However, CSA retains the prerogative to undertake reviews of other organizations at any time and subsequently to revise and publish the list. If CSA finds an organization to be unacceptable to receive CSA funds in payment of membership dues, CSA will also consider unallowable any other expenditures of grant funds, ef

fective the date of the determination, which go to support directly or indirectly activities of this organization including travel to meetings or training seminars sponsored by such organization, payment of registration fees at such events, etc.

[42 FR 63171, Dec. 15, 1977, as amended at 45 FR 64940, Oct. 1, 1980]

ATTACHMENT A

LIST OF UNACCEPTABLE ORGANIZATIONS National Association for Community Development (NACD)

Subpart 1068.42-Grantee Fiscal Responsibility and Auditing (CSA Instruction 6801-1 and 6801-1 Ch 1)

AUTHORITY: Sec. 602, 78 Stat. 530 (42 U.S.C. 2942); § 1068.42-8 also issued under sec. 682(e), Pub. L. 97-35, 95 Stat. 519 (42 U.S.C. 9911).

SOURCE: 44 FR 56568, Oct. 1, 1979, unless otherwise noted.

§ 1068.42-1 Applicability.

This subpart applies to all grantees financially assisted under Titles II, IV, and VII of the Economic Opportunity Act of 1964, as amended, if such assistance is administered by the Community Services Administration. This subpart is not applicable to contractors under CSA procurement contracts.

$1068.42-2 Effective date.

August 5, 1970 (CSA Instruction 6801-1). May 11, 1971 (CSA Instruction 6801-1, Change 1).

§ 1068.42-3 Definitions.

"Delegate agency" means an agency to which a grantee delegates the performance of an entire program account of a grant or a substantial part of a single program account. As used in this subpart the term also refers to "subcontractors" who contract with the grantee to perform any major portion of a CSA funded program.

"Grant-grantee" as used in this subpart, also refers to contracts of assistance and contractors under such contracts respectively.

"Responsible CSA official" means the CSA official in the Headquarters

Office, or the Regional Office of CSA, who has authority to award and administer the CSA grant in question.

§ 1068.42-4 Policy.

(a) Before funds will be released to a grantee receiving an initial Community Services Administration (CSA) grant, the grantee, must submit a statement to CSA certifying that its accounting system and that of its delegated agencies meet the standards set forth in Section 243(a) of the EOA. See Appendix A of this subpart. Within three (3) months after the effective date of an initial grant, a grantee must have its accounting system surveyed and evaluated by an auditor. On the basis of the auditor's findings and conclusions, the CSA Director or the Director's designee will determine whether the accounting system meets CSA standards and, if not, whether to suspend the grant.

(b) An audit of each grant must be made annually. On the basis of resultant findings and conclusions, the Director or the Director's designee will determine whether any of the costs or expenditures incurred shall be disallowed as charges against grant funds. In the event of disallowance, the Director may seek recovery of sums by appropriate means. The Director may also impose additional requirements to assure that the conditions that gave rise to the disallowance have been corrected and will not recur.

(c) Grantees must require of delegate agencies substantially the same audit responsibilities that CSA requires of grantees. However, grantees remain responsible to CSA for the proper expenditure of and accounting for all grant funds, whether or not delegated to other agencies.

§ 1068.42-5 Accounting system certification.

(a) General. The accounting system certification states that the grantee and its delegate agencies (or subcontractors for performance of any major portion of the assisted program) have established an adequate accounting system with appropriate internal controls to safeguard assets, check the accuracy and reliability of their accounting data, promote operating efficiency

and encourage compliance with prescribed management policies and any additional fiscal responsibilities and accounting requirements established by CSA.

(1) The certification may be furnished by an independent certified public accountant, an independent State-licensed public accountant, or, in the case of a public agency, the appropriate public financial officer who accepts responsibility for providing required financial services to the grantee. The statements in Appendices B and C of this subpart will satisfy CSA's requirements for an accounting system certification.

(b) New grantees. A grantee applying for its initial CSA grant shall submit this certification to the granting office as part of the funding request. If an applicant is unable to obtain the certification, it should forward a statement of explanation to the granting office. The granting office may process the application without the statement where it can reasonably be expected that the statement will be furnished at or before the commencement of the grant period (that is when a new organization's accounting system is still in the process of development at the time of application). In no event, however, will any CSA funds be released to the grantee until the proper statement has been submitted.

(c) On-going grantees. Although accounting system certifications are usually required only for the initial CSA grant to the grantee, there may be instances when CSA will require a new certification from an on-going grantee. For example, when there has been a significant increase in the amount of funds provided by CSA. An on-going grantee will be notified by CSA if a new certification must be submitted.

(d) Delegate agencies. A grantee may not release or commit any grant funds to a new delegate agency unless it has received from that agency an accounting system certification appropriately modeled after those shown in Appendices B and C of this subpart. If an existing delegate agency is to receive a substantial increase in funds from the grantee, a new certification must also be submitted to the grantee. These certifications are to be obtained by the