Page 1133 TITLE 22—FOREIGN RELATIONS AND INTERCOURSE § 4413

cifically appropriated for grants to the Endowment or with funds appropriated to the Agency

for the ‘‘Salaries and Expenses’’ account. Such

grants shall be made pursuant to a grant agreement between the Director and the Endowment

which requires that grant funds will only be

used for activities which the Board of Directors

of the Endowment determines are consistent

with the purposes described in section 4411(b) of

this title, that the Endowment will allocate

funds in accordance with subsection (e) of this

section, and that the Endowment will otherwise

comply with the requirements of this subchapter. The grant agreement may not require

the Endowment to comply with requirements

other than those specified in this subchapter.

(b) Implementation of purposes

Funds so granted may be used by the Endowment to carry out the purposes described in section 4411(b) of this title, and otherwise applicable limitations on the purposes for which funds

appropriated to the United States Information

Agency may be used shall not apply to funds

granted to the Endowment.

(c) Status of Endowment

Nothing in this subchapter shall be construed

to make the Endowment an agency or establishment of the United States Government or to

make the members of the Board of Directors of

the Endowment, or the officers or employees of

the Endowment, officers or employees of the

United States.

(d) Oversight procedures applicable

The Endowment and its grantees shall be subject to the appropriate oversight procedures of

the Congress.

(e) Amounts to Free Trade Union Institute and

National Chamber Foundation

Of the amounts made available to the Endowment for each of the fiscal years 1984 and 1985 to

carry out programs in furtherance of the purposes of this Act—

(1) not less than $13,800,000 shall be for the

Free Trade Union Institute; and

(2) not less than $2,500,000 shall be to support

private enterprise development programs of

the National Chamber Foundation.

(f) Independent labor unions

Nothing in this subchapter shall preclude the

Endowment from making grants to independent

labor unions.

(Pub. L. 98–164, title V, §503, Nov. 22, 1983, 97

Stat. 1040; Pub. L. 100–204, title II, §212, Dec. 22,

1987, 101 Stat. 1376.)

REFERENCES IN TEXT

This Act, referred to in subsec. (e), is Pub. L. 98–164,

Nov. 22, 1983, 97 Stat. 1017. For complete classification

of this Act to the Code, see Tables.

AMENDMENTS

1987—Subsec. (f). Pub. L. 100–204 added subsec. (f).

§ 4413. Eligibility of the Endowment for grants

(a) Compliance with statutory requirements

Grants may be made to the Endowment under

this subchapter only if the Endowment agrees to

comply with the requirements specified in this

section and elsewhere in this subchapter.

(b) Funding for private sector groups and covered programs only

(1) The Endowment may only provide funding

for programs of private sector groups and may

not carry out programs directly.

(2) The Endowment may provide funding only

for programs which are consistent with the purposes set forth in section 4411(b) of this title.

(c) Compensation, etc., for officers and employees of Endowment

(1) Officers of the Endowment may not receive

any salary or other compensation from any

source, other than the Endowment, for services

rendered during the period of their employment

by the Endowment.

(2) If an individual who is an officer or employee of the United States Government serves

as a member of the Board of Directors or as an

officer or employee of the Endowment, that individual may not receive any compensation or

travel expenses in connection with services performed for the Endowment.

(d) Prohibitions respecting financial matters

(1) The Endowment shall not issue any shares

of stock or declare or pay any dividends.

(2) No part of the assets of the Endowment

shall inure to the benefit of any member of the

Board, any officer or employee of the Endowment, or any other individual, except as salary

or reasonable compensation for services.

(e) Audit of accounts; reporting requirements

(1) The accounts of the Endowment shall be

audited annually in accordance with generally

accepted auditing standards by independent certified public accountants or independent licensed public accountants certified or licensed

by a regulatory authority of a State or other political subdivision of the United States. The audits shall be conducted at the place or places

where the accounts of the Endowment are normally kept. All books, accounts, financial

records, reports, files, and all other papers,

things, or property belonging to or in use by the

Endowment and necessary to facilitate the audits shall be made available to the person or persons conducting the audits; and full facilities for

verifying transactions with any assets held by

depositories, fiscal agents, and custodians shall

be afforded to such person or persons.

(2) The report of each such independent audit

shall be included in the annual report required

by subsection (h) of this section. The audit report shall set forth the scope of the audit and include such statements as are necessary to

present fairly the Endowment’s assets and liabilities, surplus or deficit, with an analysis of

the changes therein during the year, supplemented in reasonable detail by a statement of

the Endowment’s income and expenses during

the year, and a statement of the application of

funds, together with the independent auditor’s

opinion of those statements.

(f) Audit of financial transactions; reporting requirements

(1) The financial transactions of the Endowment for each fiscal year may be audited by the
§ 4414 TITLE 22—FOREIGN RELATIONS AND INTERCOURSE Page 1134

General Accounting Office in accordance with

such principles and procedures and under such

rules and regulations as may be prescribed by

the Comptroller General of the United States.

Any such audit shall be conducted at the place

or places where accounts of the Endowment are

normally kept. The representatives of the General Accounting Office shall have access to all

books, accounts, records, reports, files, and all

other papers, things, or property belonging to or

in use by the Endowment pertaining to its financial transactions and necessary to facilitate the

audit; and they shall be afforded full facilities

for verifying transactions with any assets held

by depositories, fiscal agents, and custodians.

All such books, accounts, records, reports, files,

papers, and property of the Endowment shall remain in the possession and custody of the Endowment.

(2) A report of each such audit shall be made

by the Comptroller General to the Congress. The

report to the Congress shall contain such comments and information as the Comptroller General may deem necessary to inform the Congress

of the financial operations and condition of the

Endowment, together with such recommendations with respect thereto as he may deem advisable. The report shall also show specifically

any program, expenditure, or other financial

transaction or undertaking observed in the

course of the audit, which, in the opinion of the

Comptroller General, has been carried on or

made contrary to the requirements of this subchapter. A copy of each report shall be furnished

to the President and to the Endowment at the

time submitted to the Congress.

(g) Audits by United States Information Agency

The financial transactions of the Endowment

for each fiscal year shall be audited by the

United States Information Agency under the

conditions set forth in subsection (f)(1) of this

section.

(h) Recordkeeping requirements; audit and examination of books, etc.

(1) The Endowment shall ensure that each recipient of assistance provided through the Endowment under this subchapter keeps separate

bank accounts or separate self-balancing ledger

accounts with respect to such assistance and

such records as may be reasonably necessary to

fully disclose the amount and the disposition by

such recipient of the proceeds of such assistance, the total cost of the project or undertaking in connection with which such assistance

is given or used, and the amount and nature of

that portion of the cost of the project or undertaking supplied by other sources, and such other

records as will facilitate an effective audit.

(2) The Endowment shall ensure that it, or any

of its duly authorized representatives, shall

have access for the purpose of audit and examination to any books, documents, papers, and

records of the recipient that are pertinent to assistance provided through the Endowment under

this subchapter. The Comptroller General of the

United States or any of his duly authorized representatives shall also have access thereto for

such purpose.

(i) Annual report; contents; testimony respecting

report

Not later than February 1 of each year, the

Endowment shall submit an annual report for

the preceding fiscal year to the President for

transmittal to the Congress. The report shall include a comprehensive and detailed report of the

Endowment’s operations, activities, financial

condition, and accomplishments under this subchapter and may include such recommendations

as the Endowment deems appropriate. The

Board members and officers of the Endowment

shall be available to testify before appropriate

committees of the Congress with respect to such

report, the report of any audit made by the

Comptroller General pursuant to subsection (f)

of this section, or any other matter which any

such committee may determine.

(j) Grantee; conflict of interest

After January 31, 1993, no member of the

Board of the Endowment may be a member of

the board of directors or an officer of any grantee of the National Endowment for Democracy

which receives more than 5 percent of the funds

of the Endowment for any fiscal year.

(Pub. L. 98–164, title V, §504, Nov. 22, 1983, 97

Stat. 1040; Pub. L. 99–93, title II, §210(b), (d),

Aug. 16, 1985, 99 Stat. 432; Pub. L. 100–204, title II,

§211, Dec. 22, 1987, 101 Stat. 1376; Pub. L. 102–138,

title II, §§211(d), 215, Oct. 28, 1991, 105 Stat. 695,

697; Pub. L. 103–236, title II, §228, Apr. 30, 1994,

108 Stat. 423.)

AMENDMENTS

1994—Subsec. (h)(1). Pub. L. 103–236 substituted ‘‘bank

accounts or separate self-balancing ledger accounts’’

for ‘‘accounts’’.

1991—Subsec. (g). Pub. L. 102–138, §211(d), substituted

‘‘shall’’ for ‘‘may also’’ before ‘‘be audited’’.

Subsec. (j). Pub. L. 102–138, §215, added subsec. (j).

1987—Subsec. (h)(1). Pub. L. 100–204 inserted ‘‘separate

accounts with respect to such assistance and’’ after

‘‘keeps’’.

1985—Subsecs. (g) to (i). Pub. L. 99–93 added subsec.

(g), redesignated existing subsecs. (g) and (h) as (h) and

(i), respectively, and in subsec. (i) substituted ‘‘February 1’’ for ‘‘December 31’’.

§ 4414. Requirements relating to the Endowment

and its grantees

(a) Partisan politics

(1) Funds may not be expended, either by the

Endowment or by any of its grantees, to finance

the campaigns of candidates for public office.

(2) No funds granted by the Endowment may

be used to finance activities of the Republican

National Committee or the Democratic National

Committee.

(3) No grants may be made to any institute,

foundation, or organization engaged in partisan

activities on behalf of the Republican or Democratic National Committee, on behalf of any

candidate for public office, or on behalf of any

political party in the United States.

(b) Consultation with Department of State

The Endowment shall consult with the Department of State on any overseas program funded

by the Endowment prior to the commencement

of the activities of that program.

(Pub. L. 98–164, title V, §505, as added Pub. L.

99–93, title II, §210(a), Aug. 16, 1985, 99 Stat. 431.)