[Code of Federal Regulations][Title 45, Volume 1, Parts 1 to 199]
[Revised as of October 1, 1999]
[CITE: 45CFR74.21] [Page 194]
TITLE 45--PUBLIC WELFARE AND HUMAN SERVICES
PART 74--UNIFORM ADMINISTRATIVE REQUIREMENTS FOR AWARDS AND SUBAWARDS TO
INSTITUTIONS OF HIGHER EDUCATION, HOSPITALS, OTHER NONPROFIT ORGANIZATIONS,
Subpart C--Post-Award Requirements
Sec. 74.21 Standards for financial management systems.
(a) Recipients shall relate financial data to performance data and develop unit cost information whenever practical. For awards that
support research, unit cost information is usually not appropriate.
(b) Recipients' financial management systems shall provide for the following:
(1) Accurate, current and complete disclosure of the financial results of each HHS-sponsored project or program in accordance with the
reporting requirements set forth in Sec. 74.52. If the HHS awarding agency requires reporting on an accrual basis from a recipient that
maintains its records on other than an accrual basis, the recipient shall not be required to establish an accrual accounting system. These
recipients may develop such accrual data for their reports on the basis of an analysis of the documentation on hand.
(2) Records that identify adequately the source and application of funds for HHS-sponsored activities. These records shall contain
information pertaining to Federal awards, authorizations, obligations, unobligated balances, assets, outlays, income and interest.
(3) Effective control over and accountability for all funds, property and other assets. Recipients shall adequately safeguard all
such assets and assure they are used solely for authorized purposes.
(4) Comparison of outlays with budget amounts for each award. Whenever appropriate, financial information should be related to
performance and unit cost data. (Unit cost data are usually not appropriate for awards that support research.)
(5) Written procedures to minimize the time elapsing between the transfer of funds to the recipient from the U.S. Treasury and the
issuance or redemption of checks, warrants or payments by other means for program purposes by the recipient. To the extent that the provisions
of the Cash Management Improvement Act (CMIA) (Pub. L. 101-453) and its implementing regulations, “Rules and Procedures for Funds Transfers,”
(31 CFR part 205) apply, payment methods of State agencies, instrumentalities, and fiscal agents shall be consistent with CMIA
Treasury-State Agreements, or the CMIA default procedures codified at 31 CFR 205.9(f).
(6) Written procedures for determining the reasonableness, allocability and allowability of costs in accordance with the provisions
of the applicable Federal cost principles and the terms and conditions of the award.
(7) Accounting records, including cost accounting records, that are supported by source documentation.
(c) Where the Federal Government guarantees or insures the repayment of money borrowed by the recipient, the HHS awarding agency, at its
discretion, may require adequate bonding and insurance if the bonding and insurance requirements of the recipient are not deemed adequate to
protect the interest of the Federal Government.
(d) The HHS awarding agency may require adequate fidelity bond coverage where the recipient lacks sufficient coverage to protect the
Federal Government's interest.
(e) Where bonds are required in the situations described in Sec. 74.21 (c) and (d), the bonds shall be obtained from companies
holding certificates of authority as acceptable sureties, as prescribed in 31 CFR part 223, “Surety Companies Doing Business with the United
States.”
