; and (2) under subsection (a)(2), shall be used by the State for any postsecondary education purpose permitted by State law. (f) Supplement, not supplant A grant received under subsection (a) shall only be used to supplement the amount of funds that would, in the absence of such grant, be made available from non-Federal sources for elementary school and secondary school programs or postsecondary education programs, and not to supplant those funds. 5. Administrative and fiscal accountability (a) Audits (1) Contract with approved auditing entity Not later than October 1, 2017, and annually thereafter, a State shall contract with an approved auditing entity (as defined under paragraph (3)(B)) for purposes of conducting an audit under paragraph (2) (with respect to the fiscal year ending September 30 of such year). (2) Audit requirement Under a contract under paragraph (1), an approved auditing entity shall conduct an audit of the expenditures or transfers made by a State from amounts received under a grant under section 4, with respect to the fiscal year which such audit covers, to determine the extent to which such expenditures and transfers were expended in accordance with section 4. (3) Entity conducting audit (A) In general With respect to a State, the audit under paragraph (2) shall be conducted by an approved auditing entity in accordance with generally accepted auditing principles. (B) Approved auditing entity For purposes of this section, the term approved auditing entity means, with respect to a State, an entity that is— (i) approved by the Secretary of the Treasury; (ii) approved by the chief executive officer of the State