diff --git a/bin/nyc.js b/bin/nyc.js
index 01ab304c8..8f62054a3 100755
--- a/bin/nyc.js
+++ b/bin/nyc.js
@@ -43,7 +43,6 @@ if (argv._[0] === 'report') {
   if (config.all) nyc.addAllFiles()
 
   var env = {
-    NYC_CACHE: argv.cache ? 'enable' : 'disable',
     NYC_CONFIG: JSON.stringify(config),
     NYC_CWD: process.cwd(),
     NYC_ROOT_ID: nyc.rootId,
diff --git a/bin/wrap.js b/bin/wrap.js
index d64aceb1a..0ec3cb0cd 100644
--- a/bin/wrap.js
+++ b/bin/wrap.js
@@ -11,7 +11,8 @@ process.env.NYC_PARENT_PID = process.pid
 
 var config = {}
 if (process.env.NYC_CONFIG) config = JSON.parse(process.env.NYC_CONFIG)
-config.enableCache = process.env.NYC_CACHE === 'enable'
+config.isChildProcess = true
+
 config._processInfo = {
   ppid: parentPid,
   root: process.env.NYC_ROOT_ID
diff --git a/build-tests.js b/build-tests.js
index 62d755d8b..83c59ebec 100644
--- a/build-tests.js
+++ b/build-tests.js
@@ -15,7 +15,7 @@ mkdirp.sync(path.join(__dirname, 'test/build'))
 
 var testDir = path.join(__dirname, 'test/src')
 var buildDir = path.join(__dirname, 'test/build')
-var originalTestsFilename = path.join(testDir, 'nyc-test.js')
+var originalTestsFilename = path.join(testDir, 'nyc-tap.js')
 var originalTestSource = fs.readFileSync(originalTestsFilename, 'utf8')
 var individualTests = forkingTap(originalTestSource, {
   filename: originalTestsFilename,
diff --git a/index.js b/index.js
index ec2ed2d0a..2864d14a2 100755
--- a/index.js
+++ b/index.js
@@ -1,25 +1,26 @@
 /* global __coverage__ */
-var arrify = require('arrify')
-var debugLog = require('debug-log')('nyc')
-var fs = require('fs')
-var glob = require('glob')
-var libCoverage = require('istanbul-lib-coverage')
-var libHook = require('istanbul-lib-hook')
-var libReport = require('istanbul-lib-report')
-var libSourceMaps = require('istanbul-lib-source-maps')
-var reports = require('istanbul-reports')
-var mkdirp = require('mkdirp')
-var Module = require('module')
-var cachingTransform = require('caching-transform')
-var path = require('path')
-var rimraf = require('rimraf')
-var onExit = require('signal-exit')
-var resolveFrom = require('resolve-from')
-var convertSourceMap = require('convert-source-map')
-var md5hex = require('md5-hex')
-var findCacheDir = require('find-cache-dir')
-var js = require('default-require-extensions/js')
-var testExclude = require('test-exclude')
+
+const arrify = require('arrify')
+const cachingTransform = require('caching-transform')
+const debugLog = require('debug-log')('nyc')
+const findCacheDir = require('find-cache-dir')
+const fs = require('fs')
+const glob = require('glob')
+const Hash = require('./lib/hash')
+const js = require('default-require-extensions/js')
+const libCoverage = require('istanbul-lib-coverage')
+const libHook = require('istanbul-lib-hook')
+const libReport = require('istanbul-lib-report')
+const md5hex = require('md5-hex')
+const mkdirp = require('mkdirp')
+const Module = require('module')
+const onExit = require('signal-exit')
+const path = require('path')
+const reports = require('istanbul-reports')
+const resolveFrom = require('resolve-from')
+const rimraf = require('rimraf')
+const SourceMaps = require('./lib/source-maps')
+const testExclude = require('test-exclude')
 
 var ProcessInfo
 try {
@@ -29,10 +30,6 @@ try {
   ProcessInfo = require('./lib/process.js')
 }
 
-// bust cache whenever nyc is upgraded, this prevents
-// crashers caused by instrumentation updates.
-var CACHE_VERSION = require('./package.json').version
-
 /* istanbul ignore next */
 if (/index\.covered\.js$/.test(__filename)) {
   require('./lib/self-coverage-helper')
@@ -50,12 +47,10 @@ function NYC (config) {
   this._showProcessTree = config.showProcessTree || false
   this._eagerInstantiation = config.eager || false
   this.cwd = config.cwd || process.cwd()
-
   this.reporter = arrify(config.reporter || 'text')
 
   this.cacheDirectory = config.cacheDir || findCacheDir({name: 'nyc', cwd: this.cwd})
-
-  this.enableCache = Boolean(this.cacheDirectory && (config.enableCache === true || process.env.NYC_CACHE === 'enable'))
+  this.cache = Boolean(this.cacheDirectory && config.cache)
 
   this.exclude = testExclude({
     cwd: this.cwd,
@@ -63,6 +58,11 @@ function NYC (config) {
     exclude: config.exclude
   })
 
+  this.sourceMaps = new SourceMaps({
+    cache: this.cache,
+    cacheDirectory: this.cacheDirectory
+  })
+
   // require extensions can be provided as config in package.json.
   this.require = arrify(config.require)
 
@@ -78,11 +78,7 @@ function NYC (config) {
     return transforms
   }.bind(this), {})
 
-  this.sourceMapCache = libSourceMaps.createSourceMapStore()
-
   this.hookRunInContext = config.hookRunInContext
-  this.hashCache = {}
-  this.loadedMaps = null
   this.fakeRequire = null
 
   this.processInfo = new ProcessInfo(config && config._processInfo)
@@ -90,20 +86,16 @@ function NYC (config) {
 }
 
 NYC.prototype._createTransform = function (ext) {
-  var _this = this
-
   var opts = {
-    salt: JSON.stringify({
-      istanbul: require('istanbul-lib-coverage/package.json').version,
-      nyc: require('./package.json').version
-    }),
+    salt: Hash.salt,
     hash: function (code, metadata, salt) {
-      var hash = md5hex([code, metadata.filename, salt]) + '_' + CACHE_VERSION
-      _this.hashCache[metadata.filename] = hash
+      var hash = Hash(code, metadata.filename)
       return hash
     },
     cacheDir: this.cacheDirectory,
-    disableCache: !this.enableCache,
+    // when running --all we should not load source-file from
+    // cache, we want to instead return the fake source.
+    disableCache: this._disableCachingTransform(),
     ext: ext
   }
   if (this._eagerInstantiation) {
@@ -114,6 +106,10 @@ NYC.prototype._createTransform = function (ext) {
   return cachingTransform(opts)
 }
 
+NYC.prototype._disableCachingTransform = function () {
+  return !(this.cache && this.config.isChildProcess)
+}
+
 NYC.prototype._loadAdditionalModules = function () {
   var _this = this
   this.require.forEach(function (r) {
@@ -271,7 +267,7 @@ NYC.prototype._transformFactory = function (cacheDir) {
     var filename = metadata.filename
     var sourceMap = null
 
-    if (_this._sourceMap) sourceMap = _this._handleSourceMap(cacheDir, code, hash, filename)
+    if (_this._sourceMap) sourceMap = _this.sourceMaps.extractAndRegister(code, filename)
 
     try {
       instrumented = instrumenter.instrumentSync(code, filename, sourceMap)
@@ -289,19 +285,6 @@ NYC.prototype._transformFactory = function (cacheDir) {
   }
 }
 
-NYC.prototype._handleSourceMap = function (cacheDir, code, hash, filename) {
-  var sourceMap = convertSourceMap.fromSource(code) || convertSourceMap.fromMapFileSource(code, path.dirname(filename))
-  if (sourceMap) {
-    if (hash) {
-      var mapPath = path.join(cacheDir, hash + '.map')
-      fs.writeFileSync(mapPath, sourceMap.toJSON())
-    } else {
-      this.sourceMapCache.registerMap(filename, sourceMap.sourcemap)
-    }
-  }
-  return sourceMap
-}
-
 NYC.prototype._handleJs = function (code, filename) {
   var relFile = path.relative(this.cwd, filename)
   // ensure the path has correct casing (see istanbuljs/nyc#269 and nodejs/node#6624)
@@ -333,13 +316,14 @@ NYC.prototype.cleanup = function () {
 }
 
 NYC.prototype.clearCache = function () {
-  if (this.enableCache) {
+  if (this.cache) {
     rimraf.sync(this.cacheDirectory)
   }
 }
 
 NYC.prototype.createTempDirectory = function () {
   mkdirp.sync(this.tempDirectory())
+  mkdirp.sync(this.cacheDirectory)
 
   if (this._showProcessTree) {
     mkdirp.sync(this.processInfoDirectory())
@@ -379,14 +363,14 @@ NYC.prototype.writeCoverageFile = function () {
   var coverage = coverageFinder()
   if (!coverage) return
 
-  if (this.enableCache) {
+  if (this.cache) {
     Object.keys(coverage).forEach(function (absFile) {
-      if (this.hashCache[absFile] && coverage[absFile]) {
-        coverage[absFile].contentHash = this.hashCache[absFile]
+      if (this.sourceMaps.hashCache[absFile] && coverage[absFile]) {
+        coverage[absFile].contentHash = this.sourceMaps.hashCache[absFile]
       }
     }, this)
   } else {
-    coverage = this.sourceMapTransform(coverage)
+    coverage = this.sourceMaps.remapCoverage(coverage)
   }
 
   var id = this.generateUniqueID()
@@ -411,13 +395,6 @@ NYC.prototype.writeCoverageFile = function () {
   )
 }
 
-NYC.prototype.sourceMapTransform = function (obj) {
-  var transformed = this.sourceMapCache.transformCoverage(
-    libCoverage.createCoverageMap(obj)
-  )
-  return transformed.map.data
-}
-
 function coverageFinder () {
   var coverage = global.__coverage__
   if (typeof __coverage__ === 'object') coverage = __coverage__
@@ -431,7 +408,7 @@ NYC.prototype._getCoverageMapFromAllCoverageFiles = function () {
   this.loadReports().forEach(function (report) {
     map.merge(report)
   })
-
+  map.data = this.sourceMaps.remapCoverage(map.data)
   return map
 }
 
@@ -497,10 +474,6 @@ NYC.prototype.loadReports = function (filenames) {
   var _this = this
   var files = filenames || fs.readdirSync(this.tempDirectory())
 
-  var cacheDir = _this.cacheDirectory
-
-  var loadedMaps = this.loadedMaps || (this.loadedMaps = {})
-
   return files.map(function (f) {
     var report
     try {
@@ -512,25 +485,7 @@ NYC.prototype.loadReports = function (filenames) {
       return {}
     }
 
-    Object.keys(report).forEach(function (absFile) {
-      var fileReport = report[absFile]
-      if (fileReport && fileReport.contentHash) {
-        var hash = fileReport.contentHash
-        if (!(hash in loadedMaps)) {
-          try {
-            var mapPath = path.join(cacheDir, hash + '.map')
-            loadedMaps[hash] = JSON.parse(fs.readFileSync(mapPath, 'utf8'))
-          } catch (e) {
-            // set to false to avoid repeatedly trying to load the map
-            loadedMaps[hash] = false
-          }
-        }
-        if (loadedMaps[hash]) {
-          _this.sourceMapCache.registerMap(absFile, loadedMaps[hash])
-        }
-      }
-    })
-    report = _this.sourceMapTransform(report)
+    _this.sourceMaps.reloadCachedSourceMaps(report)
     return report
   })
 }
diff --git a/lib/config-util.js b/lib/config-util.js
index 245b1c323..5bdc177cf 100644
--- a/lib/config-util.js
+++ b/lib/config-util.js
@@ -1,9 +1,9 @@
-var arrify = require('arrify')
-var fs = require('fs')
-var path = require('path')
-var findUp = require('find-up')
-var testExclude = require('test-exclude')
-var Yargs = require('yargs/yargs')
+const arrify = require('arrify')
+const fs = require('fs')
+const path = require('path')
+const findUp = require('find-up')
+const testExclude = require('test-exclude')
+const Yargs = require('yargs/yargs')
 
 var Config = {}
 
diff --git a/lib/hash.js b/lib/hash.js
new file mode 100644
index 000000000..a36372071
--- /dev/null
+++ b/lib/hash.js
@@ -0,0 +1,14 @@
+const CACHE_VERSION = require('../package.json').version
+const md5hex = require('md5-hex')
+const salt = JSON.stringify({
+  istanbul: require('istanbul-lib-coverage/package.json').version,
+  nyc: CACHE_VERSION
+})
+
+function Hash (code, filename) {
+  return md5hex([code, filename, salt]) + '_' + CACHE_VERSION
+}
+
+Hash.salt = salt
+
+module.exports = Hash
diff --git a/lib/process-args.js b/lib/process-args.js
index fdf36ccdb..df6bcaac1 100644
--- a/lib/process-args.js
+++ b/lib/process-args.js
@@ -1,5 +1,5 @@
-var parser = require('yargs-parser')
-var commands = [
+const parser = require('yargs-parser')
+const commands = [
   'report',
   'check-coverage',
   'instrument'
diff --git a/lib/process.js b/lib/process.js
index 97e811e54..3976f14ed 100644
--- a/lib/process.js
+++ b/lib/process.js
@@ -1,6 +1,5 @@
-'use strict'
-var archy = require('archy')
-var libCoverage = require('istanbul-lib-coverage')
+const archy = require('archy')
+const libCoverage = require('istanbul-lib-coverage')
 
 function ProcessInfo (defaults) {
   defaults = defaults || {}
diff --git a/lib/self-coverage-helper.js b/lib/self-coverage-helper.js
index ccea1db89..675f9bea9 100644
--- a/lib/self-coverage-helper.js
+++ b/lib/self-coverage-helper.js
@@ -1,9 +1,9 @@
 /* global ___NYC_SELF_COVERAGE___ */
 
-var path = require('path')
-var fs = require('fs')
-var mkdirp = require('mkdirp')
-var onExit = require('signal-exit')
+const path = require('path')
+const fs = require('fs')
+const mkdirp = require('mkdirp')
+const onExit = require('signal-exit')
 
 onExit(function () {
   var coverage = global.___NYC_SELF_COVERAGE___
diff --git a/lib/source-maps.js b/lib/source-maps.js
new file mode 100644
index 000000000..3842626b4
--- /dev/null
+++ b/lib/source-maps.js
@@ -0,0 +1,61 @@
+const convertSourceMap = require('convert-source-map')
+const libCoverage = require('istanbul-lib-coverage')
+const libSourceMaps = require('istanbul-lib-source-maps')
+const fs = require('fs')
+const Hash = require('./hash')
+const path = require('path')
+
+// TODO: write some unit tests for this class.
+function SourceMaps (opts) {
+  this.cache = opts.cache
+  this.cacheDirectory = opts.cacheDirectory
+  this.sourceMapCache = libSourceMaps.createSourceMapStore()
+  this.loadedMaps = {}
+  this.hashCache = {}
+}
+
+SourceMaps.prototype.extractAndRegister = function (code, filename) {
+  var sourceMap = convertSourceMap.fromSource(code) || convertSourceMap.fromMapFileSource(code, path.dirname(filename))
+  if (sourceMap) {
+    var hash = Hash(code, filename)
+    if (this.cache && !this.hashCache[filename]) {
+      this.hashCache[filename] = hash
+      var mapPath = path.join(this.cacheDirectory, hash + '.map')
+      fs.writeFileSync(mapPath, sourceMap.toJSON())
+    } else {
+      this.sourceMapCache.registerMap(filename, sourceMap.sourcemap)
+    }
+  }
+  return sourceMap
+}
+
+SourceMaps.prototype.remapCoverage = function (obj) {
+  var transformed = this.sourceMapCache.transformCoverage(
+    libCoverage.createCoverageMap(obj)
+  )
+  return transformed.map.data
+}
+
+SourceMaps.prototype.reloadCachedSourceMaps = function (report) {
+  var _this = this
+  Object.keys(report).forEach(function (absFile) {
+    var fileReport = report[absFile]
+    if (fileReport && fileReport.contentHash) {
+      var hash = fileReport.contentHash
+      if (!(hash in _this.loadedMaps)) {
+        try {
+          var mapPath = path.join(_this.cacheDirectory, hash + '.map')
+          _this.loadedMaps[hash] = JSON.parse(fs.readFileSync(mapPath, 'utf8'))
+        } catch (e) {
+          // set to false to avoid repeatedly trying to load the map
+          _this.loadedMaps[hash] = false
+        }
+      }
+      if (_this.loadedMaps[hash]) {
+        _this.sourceMapCache.registerMap(absFile, _this.loadedMaps[hash])
+      }
+    }
+  })
+}
+
+module.exports = SourceMaps
diff --git a/package.json b/package.json
index 562420500..3e55a28de 100644
--- a/package.json
+++ b/package.json
@@ -6,14 +6,13 @@
   "scripts": {
     "bundle": "bundle-dependencies update",
     "pretest": "standard",
-    "test": "npm run cover",
+    "test": "npm run clean && npm run build && npm run instrument && npm run test-integration && npm run test-mocha && npm run report",
     "clean": "rimraf ./.nyc_output ./node_modules/.cache ./.self_coverage ./test/fixtures/.nyc_output ./test/fixtures/node_modules/.cache *covered.js ./lib/*covered.js",
     "build": "node ./build-tests",
     "instrument": "node ./build-self-coverage.js",
-    "run-tests": "tap -t120 --no-cov -b ./test/build/*.js ./test/src/nyc-bin.js ./test/src/process-args.js",
+    "test-integration": "tap -t120 --no-cov -b ./test/build/*.js && mocha --timeout=15000 ./test/src/nyc-bin.js",
+    "test-mocha": "node ./bin/nyc --silent --temp-directory=./.self_coverage mocha ./test/nyc.js ./test/process-args.js",
     "report": "node ./bin/nyc  --temp-directory ./.self_coverage/ -r text -r lcov report",
-    "cover": "npm run clean && npm run build && npm run instrument && npm run run-tests && npm run report",
-    "dev": "npm run clean && npm run build && npm run run-tests",
     "release": "standard-version"
   },
   "bin": {
@@ -34,7 +33,9 @@
       "coverage",
       "test/fixtures/coverage.js",
       "test/build/*",
-      "test/nyc-test.js",
+      "test/src/*",
+      "test/nyc.js",
+      "test/process-args.js",
       "index.covered.js",
       "test/fixtures/_generateCoverage.js"
     ]
@@ -109,6 +110,7 @@
     "forking-tap": "^0.1.1",
     "is-windows": "^1.0.0",
     "lodash": "^4.12.0",
+    "mocha": "^3.2.0",
     "newline-regex": "^0.2.1",
     "requirejs": "^2.3.0",
     "sanitize-filename": "^1.5.3",
diff --git a/test/nyc.js b/test/nyc.js
new file mode 100644
index 000000000..fe455e07c
--- /dev/null
+++ b/test/nyc.js
@@ -0,0 +1,29 @@
+/* global describe, it */
+
+const NYC = require('../')
+require('chai').should()
+
+describe('NYC', function () {
+  describe('_disableCachingTransform', function () {
+    it('is disabled if cache is "false"', function () {
+      const nyc = new NYC({cache: false})
+      nyc._disableCachingTransform().should.equal(true)
+    })
+
+    it('is enabled if cache is "true" and isChildProcess is "true"', function () {
+      const nyc = new NYC({
+        cache: true,
+        isChildProcess: true
+      })
+      nyc._disableCachingTransform().should.equal(false)
+    })
+
+    it('is disabled if cache is "true" and isChildProcess is "false"', function () {
+      const nyc = new NYC({
+        cache: true,
+        isChildProcess: true
+      })
+      nyc._disableCachingTransform().should.equal(false)
+    })
+  })
+})
diff --git a/test/src/process-args.js b/test/process-args.js
similarity index 91%
rename from test/src/process-args.js
rename to test/process-args.js
index 1f6e7dc89..bab9806e8 100644
--- a/test/src/process-args.js
+++ b/test/process-args.js
@@ -1,9 +1,8 @@
 /* global describe, it */
 
 require('chai').should()
-require('tap').mochaGlobals()
 
-const processArgs = require('../../lib/process-args')
+const processArgs = require('../lib/process-args')
 
 describe('process-args', function () {
   describe('hideInstrumenterArgs', function () {
@@ -13,14 +12,14 @@ describe('process-args', function () {
         '--reporter',
         'lcov',
         'node',
-        'test/nyc-test.js'
+        'test/nyc-tap.js'
       ]
 
       var yargv = require('yargs/yargs')(process.argv.slice(2)).argv
 
       var munged = processArgs.hideInstrumenterArgs(yargv)
 
-      munged.should.eql(['node', 'test/nyc-test.js'])
+      munged.should.eql(['node', 'test/nyc-tap.js'])
     })
 
     it('parses extra args directly after -- as Node execArgv', function () {
@@ -46,7 +45,7 @@ describe('process-args', function () {
         '--reporter',
         'lcov',
         'node',
-        'test/nyc-test.js',
+        'test/nyc-tap.js',
         '--arg',
         '--'
       ]
diff --git a/test/src/nyc-bin.js b/test/src/nyc-bin.js
index 564c1030c..3c20a1064 100644
--- a/test/src/nyc-bin.js
+++ b/test/src/nyc-bin.js
@@ -13,7 +13,6 @@ var rimraf = require('rimraf')
 var spawn = require('child_process').spawn
 
 require('chai').should()
-require('tap').mochaGlobals()
 
 // beforeEach
 rimraf.sync(path.resolve(fakebin, 'node'))
diff --git a/test/src/nyc-test.js b/test/src/nyc-tap.js
similarity index 100%
rename from test/src/nyc-test.js
rename to test/src/nyc-tap.js