---
kind: "section"
citation: "42 C.F.R. § 457.202"
title: "42"
number: "457.202"
heading: "Audits."
url: "https://uscodex.org/cfr/42/457.202"
---

# §457.202. Audits.

- (a) **Purpose.** The Department's Office of Inspector General (OIG) periodically audits State operations in order to determine whether—
  - (1) The program is being operated in a cost-efficient manner; and
  - (2) Funds are being properly expended for the purposes for which they were appropriated under Federal and State law and regulations.
- (b) **Reports.**
  - (1) The OIG releases audit reports simultaneously to State officials and the Department's program officials.
  - (2) The reports set forth OIG opinion and recommendations regarding the practices it reviewed, and the allowability of the costs it audited.
  - (3) **Cognizant officials of the Department make final determinations on all audit findings.**
- (c) **Action on audit exceptions—**
  - (1) **Concurrence or clearance.** The State agency has the opportunity of concurring in the exceptions or submitting additional facts that support clearance of the exceptions.
  - (2) **Appeal.** Any exceptions that are not disposed of under [paragraph (c)(1)](#c-1) of this section are included in a disallowance letter that constitutes the Department's final decision unless the State requests reconsideration by the Appeals Board. (Specific rules are set forth in [§ 457.212](/cfr/42/457.212.md).)
  - (3) **Adjustment.** If the decision by the Board requires an adjustment of FFP, either upward or downward, a subsequent grant award promptly reflects the amount of increase or decrease.

## Notes

### Authority

Authority: 42 U.S.C. 1302.

### Source

Source: 65 FR 33622, May 24, 2000, unless otherwise noted.