# § 3745. Required regulations
**(a)** **In General.—** The Federal Acquisition Regulation shall contain provisions on the allowability of contractor costs. Such provisions shall define in detail and in specific terms those costs which are unallowable, in whole or in part, under covered contracts.
**(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 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.
**(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 shall require that a contracting officer not resolve any questioned costs until he has obtained—
**(A)** adequate documentation with respect to such costs; and
**(B)** the opinion of the contract auditor on the allowability of such costs.
**(2)** **Presence of contract auditor.—** The Federal Acquisition Regulation shall provide that, to the maximum extent practicable, the 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 shall require that all categories of costs designated in the report of the contract auditor as questioned with respect to a proposal for settlement be resolved in such a manner that the amount of the individual questioned costs that are paid will be reflected in the settlement.
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**Source Credit**: (Added and amended Pub. L. 116–283, div. A, title XVIII, § 1832(a), (e), Jan. 1, 2021, 134 Stat. 4218, 4221.)
## Editorial Notes
### Codification
The text of subsec. (f) of , which was transferred to this section and amended by , was based on , , ; , , ; , , ; , , ; , , ; , (c), , , 3308, as amended by , , .
Another amended .
### Prior Provisions
A prior section 3745 was renumbered .
### Amendments
2021—, transferred subsec. (f) of to this section and struck out subsec. (f) designation and heading “Required Regulations” at beginning.
Subsec. (a). , (2), redesignated first two sentences of par. (1) of as subsec. (a) of this section and inserted heading. Third sentence designated subsec. (b).
Subsec. (b). , (3), designated third sentence of subsec. (a) as subsec. (b), inserted heading, and redesignated subpars. (A) to (Q) as pars. (1) to (17), respectively.
Subsec. (c). , (E), (4), redesignated pars. (2) to (4) of collectively as subsec. (c) of this section and individually as pars. (1) to (3), respectively, thereof, inserted subsec. and par. headings, and realigned margins.
## Statutory Notes and Related Subsidiaries
### Effective Date
Section and amendment by effective , with additional provisions for delayed implementation and applicability of existing law, see , set out as an Effective Date of 2021 Amendment note preceding .
### Regulations
For requirement to prescribe and periodically review regulations required by this section (formerly subsec. (f) of ), see , set out as a note under .