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· .,e · · · · : · <br />· A <br /> <br /> DRAFT <br /> <br /> With the advent of the Single audit concept and additional <br /> <br /> costs involved for counties to provide independent CPA 'compliance audits, <br /> we think indirect cost is eveo more important now than before. The <br /> recent draft of administrative procedures for the bloc grants spoke to <br /> the state's commitment on "Attachment P" audits. (Attachment I) <br /> <br /> The OFFice of Hanagement and Budget published a circular <br /> "Questions and Ansmers"~ on the single audit concept. The question and <br /> answer on the cost of single audits is as follows: <br /> <br /> Question: "How will state and local governments be expected <br /> <br /> to pay For the cost of the single audit?" <br /> <br /> Answer: "State and local governments should use norma] <br /> Financing procedures to pay for the single audit, the cost of which <br /> should be less than the aggregate cost of numerous individual g~ant <br /> audits, Under the current arrangements the Federal Government will <br /> reimburse grantees For its fair share of audit costs in accordance with <br /> Circular A-67, "Cost Principles For state and local government", these <br /> paymenLs are usually made as part of the allocated cost of grant programs <br /> being carried on by the unit of government." <br /> <br /> It's clear to me that the federa! government wants state and <br /> local gov'ernments to recover the cost of the single audit, along with <br /> other indirect cost, through an A-87 cos~ pica. The problem is that we <br /> have state legislation which prohibits indirect cost on public health and <br /> mental health grants for locaJ governments. However, the state government <br /> receives indirect cost on public health and mental health grants and is able, <br /> therefore, to recover a portion of their expenses. I~e would like to see <br /> <br /> <br />