---
kind: "section"
citation: "41 U.S.C. § 4305"
title: "41"
title_heading: "Public Contracts"
number: "4305"
heading: "Required regulations"
release: "119-102"
url: "https://uscodex.org/usc/41/4305"
units:
  - "Subtitle I — Federal Procurement Policy"
  - "Division C — Procurement"
  - "Chapter 43 — Allowable Costs"
---

# §4305. Required regulations

- (a) **In General.—** The [Federal Acquisition Regulation](/usc/41/106.md) shall contain provisions on the allowability of contractor costs. Those provisions shall define in detail and in specific terms the costs that are unallowable, in whole or in part, under [covered contracts](/usc/41/4301.md?p=2).
- (b) **Specific Items.—** The regulations shall, at a minimum, clarify the cost principles applicable to contractor costs of the following:
  - (1) Air shows.
  - (2) Membership in civic, community, and professional organizations.
  - (3) Recruitment.
  - (4) [Employee](/usc/41/8101.md?p=a-6) morale and welfare.
  - (5) Actions to influence (directly or indirectly) executive branch action on regulatory and contract matters (other than costs incurred in regard to contract proposals pursuant to solicited or unsolicited bids).
  - (6) Community relations.
  - (7) Dining facilities.
  - (8) Professional and consulting services, including legal services.
  - (9) [Compensation](/usc/41/4301.md?p=1).
  - (10) Selling and marketing.
  - (11) Travel.
  - (12) Public relations.
  - (13) Hotel and meal expenses.
  - (14) Expense of corporate aircraft.
  - (15) Company-furnished automobiles.
  - (16) Advertising.
  - (17) Conventions.
- (c) **Additional Requirements.—**
  - (1) **When questioned costs may be resolved.—** The [Federal Acquisition Regulation](/usc/41/106.md) shall require that a contracting officer not resolve any questioned costs until the contracting officer has obtained—
    - (A) adequate documentation of those costs; and
    - (B) the opinion of the contract auditor on the allowability of those costs.
  - (2) **Presence of contract auditor.—** The [Federal Acquisition Regulation](/usc/41/106.md) shall provide that, to the maximum extent practicable, a contract auditor be present at any negotiation or meeting with the contractor regarding a determination of the allowability of indirect costs of the contractor.
  - (3) **Settlement to reflect amount of individual questioned costs.—** The [Federal Acquisition Regulation](/usc/41/106.md) shall require that all categories of costs designated in the report of a contract auditor as questioned with respect to a proposal for settlement be resolved in a manner so that the amount of the individual questioned costs that are paid will be reflected in the settlement.

## Source credit

(Pub. L. 111–350, § 3, Jan. 4, 2011, 124 Stat. 3787.)

## Notes

| Historical and Revision Notes |  |  |
| --- | --- | --- |
| Revised<br>Section | Source (U.S. Code) | Source (Statutes at Large) |
| 4305(a) | 41:256(f)(1) (1st, 2d sentences). | June 30, 1949, ch. 288, title III, § 306(f), as added Pub. L. 100–700, § 8(a)(1), Nov. 19, 1988, 102 Stat. 4634; Pub. L. 103–355, title II, § 2151, Oct. 13, 1994, 108 Stat. 3312. |
| 4305(b) | 41:256(f)(1) (last sentence). |  |
| 4305(c) | 41:256(f)(2)–(4). |  |