The agency that developed the guidance is noted parenthetically. 74-4 was the designation for the Cost Principles for State and Local Governments during a period of the 1970s when the Circular was incorporated into the General Services Administration manual structure. The guide is mandated by OMB in Circular A-87 and is a governmentwide document. Most agencies adopted Circular A-87 by reference in their applicable agency grants administration regulation. However, a few Federal agencies have issued specific Federal Register notices concerning their implementation of the revised Circular A-87, to clarify issues such as effective dates or to codify the entire Circular into their regulations.
Profit continues to be unallowable.
In the Preamble to the Circular, OMB explains that the language was changed to be consistent with the wording in other Circulars. However, no change in policy was intended. Therefore, if a state has a different fiscal period than a local government it supervises, each governmental unit would adopt the Circular in accordance with its individual fiscal period. Internal service funds are covered by Attachment C of A-87.