Common use of CONTROL OF EXPENDITURES Clause in Contracts

CONTROL OF EXPENDITURES. The Contractor shall maintain adequate accounting records for the project, separate and apart from records kept for its usual operation and other contracts/grants. The Contractor shall make its records available at its office, at all reasonable times during the term of this project, for inspection, audit or reproduction by an authorized representative of the Secretary of Labor and Industry or the Auditor General. Invoices for all equipment and other expenditures must be retained and are subject to audit. If non-project items are noted on the same invoice, items that are project-related must be identified. When this project terminates, the records relating to this project shall be retained and available for a period of six (7) years. If any litigation, claim, or audit is started before the expiration of the 7-year period, the records must be retained until all litigation, claims, or audit findings involving the records have been resolved and final action taken. Monies received by the Contractor from OVR must be immediately deposited into a separate interest-bearing account, through which the movement of project funds may be readily traced. Checks used in project-related transactions must be clearly imprinted with or otherwise show the indelible notation of the specific OVR I&E Project (as titled in Appendix A) – 2016 and refer to the dedicated cost center. All transactions must have supporting documentation in the project file and must be related to the project purposes. Funds may not be commingled. If funds are commingled, the total monies paid under this Funds Commitment must be returned to OVR upon demand. Commingle means depositing or recording funds in a general account without the ability to identify each specific source of funds for any expenditure. The funds from each funding source must be identifiable with a clear audit trail for each source. As expenditures occur it is appropriate for those funds to be consolidated for carrying out a common purpose. Project funds may be used only for the purposes of this project. Temporary transfers such as payment of debts and/or purchase of non-project items with project funds may not be made from the project funds. If funds are improperly transferred, the total monies paid under this project must be returned to OVR upon demand.

CONTROL OF EXPENDITURES. The he Contractor shall maintain adequate accounting records for the project, separate and apart from records kept for its usual operation and other contracts/grants. The Contractor shall make its records available at its office, at all reasonable times during the term of this project, for inspection, audit or reproduction by an authorized representative of the Secretary of Labor and Industry or the Auditor General. Invoices for all equipment and other expenditures must be retained and are subject to audit. If non-project items are noted on the same invoice, items that are project-related must be identified. When this project terminates, the records relating to this project shall be retained and available for a period of six (7) years. If any litigation, claim, or audit is started before the expiration of the 7-year period, the records must be retained until all litigation, claims, or audit findings involving the records have been resolved and final action taken. Monies received by the Contractor from OVR must be immediately deposited into a separate interest-bearing account, through which the movement of project funds may be readily traced. Checks used in project-related transactions must be clearly imprinted with or otherwise show the indelible notation of the specific OVR I&E Project (as titled in Appendix A) – 2016 and refer to the dedicated cost center. All transactions must have supporting documentation in the project file and must be related to the project purposes. Funds may not be commingled. If funds are commingled, the total monies paid under this Funds Commitment must be returned to OVR upon demand. Commingle means depositing or recording funds in a general account without the ability to identify each specific source of funds for any expenditure. The funds from each funding source must be identifiable with a clear audit trail for each source. As expenditures occur it is appropriate for those funds to be consolidated for carrying out a common purpose. Project funds may be used only for the purposes of this project. Temporary transfers such as payment of debts and/or purchase of non-project items with project funds may not be made from the project funds. If funds are improperly transferred, the total monies paid under this project must be returned to OVR upon demand.. A

CONTROL OF EXPENDITURES. The Contractor ontractor shall maintain adequate accounting records for the project, separate and apart from records kept for its usual operation and other contracts/contracts or grants. The Contractor shall make its records available at its office, at all reasonable times during the term of this project, for inspection, audit or reproduction by an authorized representative of the Secretary of Labor and & Industry or the Auditor General. Invoices for all equipment and other expenditures must be retained and are subject to audit. If non-project items are noted on the same invoice, items that are project-related must be identified. When this project terminates, the records relating to this project shall be retained and available for a period of six (7) seven years. If any litigation, claim, or audit is started before the expiration of the 7-seven year period, the records must be retained until all litigation, claims, or audit findings involving the records have been resolved and final action taken. Monies received by the Contractor from OVR must be immediately deposited into a separate interest-bearing account, through which the movement of project funds may be readily traced. Checks used in project-related transactions must be clearly imprinted with or otherwise show the indelible notation of of: the specific OVR I&E Project (as titled in Appendix A) – 2016 year of the project issuance and refer to the dedicated cost center. All transactions must have supporting documentation in the project file and must be related to the project purposes. Funds may not be commingled. If funds are commingled, the total monies paid under this Funds Commitment must be returned to OVR upon demand. Commingle means depositing or recording funds in a general account without the ability to identify each specific source of funds for any expenditure. The funds from each funding source must be identifiable with a clear audit trail for each source. As expenditures occur it is appropriate for those funds to be consolidated for carrying out a common purpose. Project funds may be used only for the purposes of this project. Temporary transfers such as payment of debts and/or purchase of non-project items with project funds may not be made from the project funds. If funds are improperly transferred, the total monies paid under this project must be returned to OVR upon demand.. A AUDIT REQUIREMENTS xxxx Requirements for contractors receiving Federal funds and/or a combination of state and Federal funds from the Commonwealth For Projects with a budget that is comprised of Federal funds passed through the Commonwealth (including Federal monies awarded by OVR for this Project) in the amount of $750,000 or more during a single fiscal year period Contractor MUST have a single or program-specific audit conducted for that year ending the 30th day of June in accordance with the following provisions: Single Audit – a non-federal entity that expends Federal funds of $750,000 or more during the non-federal entity’s fiscal year, must have a single audit conducted in accordance with 2 C.F.R. § 200.514, “Scope of Audit,” except when it elects to have a program-specific audit conducted in accordance with paragraph (c) below. Report submission for single audit - Generally, the audit must be completed and the data collection form described in subsection 2 C.F.R. § 200.512(b) and reporting package described in 2 C.F.R. § 200.512(c) must be submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or three months after the end of the audit period (the 30th day of June). If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day. Program-Specific Audit election – When Contractor expends Federal funds under only one Federal program and Federal statutes, regulations, or the terms and conditions of the agreement with OVR do not otherwise require a financial statement audit, Contractor may elect to have a program specific audit conducted in accordance with 2 C.F.R. § 200.507. Report submission for program-specific audits - The audit must be completed and the reporting required by 2 C.F.R. § 200.515(c)(2) or (c)(3) submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or three months after the end of the audit period, (the 30th day of June), unless a different period is specified in a program-specific audit guide. Unless restricted by Federal law or regulation, the auditee must make report copies available for public inspection. Auditees and auditors must ensure that their respective parts of the reporting package do not include protected personally identifiable information. Contractor must submit and electronic copy of the Single Audit report package to the Federal Audit Clearinghouse, as well as send an electronic copy to the OVR, Division of Budget and Administrative Services as well as the OVR, Contractor and Grantee Services Division. Contractor must send a copy of the confirmation from the Federal audit Clearinghouse to the resource account XX-XXXXxxxxxXxxxx@xx.xxx Contractor receiving state funds only or a combination of state and Federal Funds from the Commonwealth (where Federal monies awarded including those by OVR for this Project total an amount LESS THAN $750,000 during a single fiscal year period) shall have a program-specific audit conducted for the year ending the 30th day of June, in accordance with the following provisions: Program-Specific Audit – When Contractor expends state and/or state and Federal funds and the conditions of the agreement with OVR do not otherwise require a financial statement audit, Contractor shall have a program specific audit conducted in accordance with 2 C.F.R. § 200.507. Report submission for program-specific audits - The audit must be completed and the reporting required by 2 C.F.R. § 200.515(c)(2) or (c)(3) submitted within the earlier of 30 calendar days after receipt of the auditor's report(s), or three months after the end of the audit period, (the 30th day of June), unless a different period is specified in a program-specific audit guide. Unless restricted by Federal law or regulation, the auditee must make report copies available for public inspection. Auditees and auditors must ensure that their respective parts of the reporting package do not include protected personally identifiable information. Contractor must submit an electronic copy of the Program Audit report package to the OVR, Division of Budget and Administrative Services as well as the OVR, Contractor and Grantee Services Division. Contractor is responsible for obtaining and securing the services of a certified public accountant or independent government auditor, at its own expense to fulfill all applicable audit requirements and provisions outlined. A reasonable portion of this expense up to 10% of the program approved administrative budget, but not to exceed $5,000 per awarded project per year may be included as an allowable administrative expense on the Budget as found in Appendix B. Contractor must comply with all applicable Federal and state grant requirements including The Single Audit Act Amendments of 1996; 2 C.F.R. Part 200 as amended; and any other applicable law or regulation, and any amendment to such other applicable law or regulation that may be enacted or promulgated by the Federal government. OVR and the Commonwealth reserve the right for Federal and/or state agencies or their authorized representatives to perform additional audits of a financial or performance nature if deemed necessary by either the Commonwealth, OVR, or Federal agencies. In instances where a Federal program-specific audit guide is available, the audit report package for a program-specific audit may be different and should be prepared in accordance with the appropriate audit guide, Government Auditing Standards, and 2 C.F.R. § 200.500, Subpart F. In addition to the requirements of 2 C.F.R. § 200.500, Subpart F, Commonwealth agencies may require that the single audit reporting packages include additional components in the Schedule of Expenditures of Federal Awards, or supplemental schedules, as identified through the respective grant agreement. Contractor’s auditor shall retain the audit report for a minimum of seven years from the date of issuance, unless the Contractor is notified in writing by the Commonwealth, the cognizant Federal agency for audit, or the oversight Federal agency for audit to extend the retention period. Audit documentation will be made available upon request to authorized representatives of the Commonwealth, the cognizant Federal agency for audit, the oversight Federal agency for audit, the Audit documentation and audit reports must be retained by the OVR as the Federal funding agency, or the US Government Accountability Office (GAO). P PROJECT BUDGET REQUIREMENTS roject monies shall be expended in accordance with the approved Budget, as presented and attached herein as Appendix B. Approved Project Award budgets may include up to a 10% maximum total administrative expense allotment. Any budgeted administrative costs in excess of 10% will be deemed ineligible for reimbursement by OVR. Project budgets may be revised, but revisions shall not be retroactive, and shall only become effective upon the date the final and fully executed budget revision request is attached to this agreement. Fully executed shall mean the date of the last signature on the revision request. Items approved by the original Budget or subsequent Budget Revision Requests must be purchased and/or obligated prior to the expiration date of the project. Documentation that the funds were obligated prior to the expiration date will require Contractor to provide purchase orders or signed purchase contracts. OVR’s approval of a Budget Revision Request permits expenditure for those approved items, but does not constitute obligation of funds by Contractor for their purchase. Staff salaries and fringe benefits may not be obligated for future payment. If obligated funds are not supported by purchase orders or signed contracts, Contractor must make appropriate refunds to OVR. QUARTERLY

CONTROL OF EXPENDITURES. The Contractor Grantee shall maintain adequate accounting records for the projectthis grant, separate and apart from records kept for its usual operation and other contracts/grants, to assure reconciliation of all project costs. The Contractor Grantee shall make its records available at its office, at all reasonable times during the term of this projectgrant, for inspection, audit or reproduction by an authorized representative of the Secretary of Labor and & Industry or the Auditor General. Invoices for all equipment and other expenditures must be retained and are subject to audit. If non-project grant items are noted on the same invoice, items that are projectgrant-related must be identified. When If this project terminatesgrant is terminated, the records relating to this project grant shall be retained and available for a period of six (7) years. If three years from the date of any litigation, claim, or audit is started before the expiration of the 7-year period, the records must be retained until all litigation, claims, or audit findings involving the records have been resolved and final action takensettlement. Monies received by Grantee for the Contractor from OVR project must be immediately deposited into a separate interest-bearing checking or savings account, assigned to a dedicated cost center through which the movement of project grant funds may be readily traced. Earned interest and program income may be used to support project operations with approval from OVR. Checks used in projectgrant-related transactions must be clearly imprinted with or otherwise show the indelible notation of the specific OVR I&E Project (as titled in Appendix A) – 2016 SPIL project and refer to the checking or savings account, and an assigned dedicated cost center. All transactions must have supporting documentation in the project grant file and must be related to the project grant purposes. Funds may not be commingled. If funds are commingled, the total monies paid under this Funds Commitment grant must be returned to OVR upon demand. Commingle means depositing or recording funds in a general account without the ability to identify each specific source of funds for any expenditure. The funds from each funding source must be identifiable with a clear audit trail for each source. As expenditures occur it is appropriate for those funds to be consolidated for carrying out a common organizational purpose. Project Grant funds may be used only for the purposes of this projectgrant. Temporary transfers such as payment of debts and/or purchase of non-project grant items with project grant funds may not be made from the project grant funds. If funds are improperly transferred, the total monies paid under this project grant must be returned to OVR upon demand. Grant monies shall be expended in accordance with this Agreement. Grantee may pay wages and fringe benefits for staff funded through this grant from its General or Payroll Account, then reimburse its General or Payroll Account for such advance using grant funds. Reimbursement may be every pay period, but, at minimum, must be every calendar quarter. Grantee may reimburse gross payroll each payday, reimburse life insurance and health care insurance each month, and reimburse taxes the month succeeding the calendar quarter. Supporting documentation, along with a rationale for the expense, must be kept for each check written from the grant account to the General or Payroll Account. Any such reimbursement must closely parallel the payment to be made from the General Account or Payroll Account. Grantees electing unemployment compensation coverage as reimbursable employers may not use grant money to build a contingency fund against possible future unemployment compensation claims. Grant payment for Unemployment Compensation claims filed against the Grantee electing this for of coverage is not permitted. Use of grant funds for expenditures other than those approved in the grant budget, or in a subsequent Budget Revision Request (“BRR”), is prohibited. Grant funds shall not be transferred to any other Grantee accounts. Exception to this provision is permitted only in the case of payroll, as noted previously, and for transfer of grant funds to cover expenditures incurred after the effective date of the grant, but prior to receipt of grant funds. Approval of a BRR by OVR Program Specialist and Analyst may also require an “Amendment to Contract Funding” that is fully executed by all parties if the program content is impacted or there is a change in planned program outcomes. In grants with more than one expenditure category (e.g., staffing and equipment), the monies allotted to each expenditure category may not be exceeded without an approved BRR. OVR recognizes that actual expenditures may exceed allowances; however, if an expenditure will exceed an estimated allowance by 25% in the Equipment or Other Category, the BRR must be approved by OVR Program Specialist prior to the expenditure. If salary for grant staff position, combined with fringe benefits for that position, will exceed the estimate by 10%, the BRR must be approved by OVR prior to the expenditure. If the total amount for a grant category is anticipated to be exceeded, Grantee is liable for the excess, unless the Program Specialist from the OVR Central Office Contractor and Grantee Services Division approves the expenditure in writing by way of a BRR prior to the expenditure. If, in the expenditure category for staff, the grant narrative includes part-time positions, and the actual time on project activities exceeds the percentage indicated on the application, then the percentage of time specified on the application will take precedence. As a general rule, the percentage of time associated with a staff position would be equally distributed throughout the grant year. For example, if a staff position is for 40% of the time on the grant project, the grant account should fund the position for two days a week for 52 weeks. Staffing covers the normal work day or work week for the position. Any variations should be specified in the grant narrative or will require a BRR with approval prior to implementation. Travel costs should be reported in the expenditure category ‘Other.’ OVR shall recognize travel costs associated with the grant. All such travel costs must be incurred in accordance with Commonwealth Travel Policy, to the extent possible. Grant Agreement budgets may be revised. Line items in the grant budget may be revised. Surplus, or undesignated grant funds resulting from an approved BRR may be used for other program-related items if written permission to do so is secured from the Program Specialist, OVR Central Office Contractor and Grantee Services Division. OVR’s written approval of the BRR, whenever applicable, must be retained by Grantee for six years from the termination date of this agreement. It is the responsibility of Grantee to obtain written approval from the OVR Central Office Contractor and Grantee Services Division Program Specialist and Analyst to make changes. All items purchased with grant monies, but not specifically approved in the original grant or through a BRR, will be considered as audit exceptions. If audit exceptions are not approved by OVR, the Grantee must make appropriate refunds to OVR. Items approved by the original Agreement or a subsequent BRR must be purchased and/or obligated prior to the expiration date of the grant. Documentation that the funds were obligated prior to the expiration date will require Grantee to provide purchase orders or signed purchase contracts. OVR’s approval of a BRR permits expenditure for those approved items, but does not constitute obligation of funds by Grantee for their purchase. Staff salaries and fringe benefits may not be obligated for future payment. If obligated funds are not supported by purchase orders or signed contracts, Grantee must make appropriate refunds to OVR.