May 18, 1993:
GAO'S Policy And Procedures Manual For Guidance Of Federal Agencies:
Title 7--Fiscal Guidance:
Transmittal Sheet No. 7-43:
Effective Date: Immediately
Material Transmitted: Complete revision of Title 7
Purpose: The General Accounting Office has revised Title 7 of its
Policy and Procedures Manual for Guidance of Federal Agencies.
Included are changes resulting from recent laws and Comptroller
General decisions affecting the fiscal procedures covered by this
title. The requirements in this title, although based on separate
authorities, complement the agencies' existing federal accounting,
internal control, and system standards.
This document was prepared after consulting with the Department of the
Treasury, the Office of Management and Budget, and receiving comments
from other government agencies. It also incorporates suggestions from
the government's chief financial officers and inspectors general.
The principal changes include:
* new procedures for adjusting and closing current and expired
appropriation account balances;
* documentation requirements and handling of certificated or
"unvouchered" payments;
* new dollar limits for reporting and resolving irregularities in the
accounts of accountable officers related to physical and certain check
losses;
* new dollar limits for agencies to administratively adjust claims
against the government;
* guidance for agencies to grant relief to accountable officers for
certain improper payments;
* procedures to account for installment collection of debts owed the
government; and;
* updated guidance on using electronic data interchange for financial
transactions.
The significant changes to the existing Title 7 are marked by a
vertical line in the left margin next to the text. There are
additional, unmarked minor changes throughout the title to aid
readability.
Title 7 frequently refers to two publications that are currently under
revision: (1) the Principles of Federal Appropriations Law, which is
referenced as a source of further information on certain topics not
covered in detail in this title, and (2) A Glossary of Terms Used in
the Federal Budget Process which, pursuant to 31 U.S.C. 1112, contains
standard definitions of fiscal terms for the government. These two
publications will be widely distributed when the revisions are
completed. In event of any inconsistencies between the definitions of
terms in the forthcoming revision of the Glossary and in Title 7, the
Glossary definition will be controlling.
Filing Instructions:
Remove and destroy: Current basic Title 7 and all changes through
Transmittal Sheet No. 7-42.
Insert: Revised Title 7.
Obtaining additional copies:
Each federal department and agency receives a limited number of copies
of all revisions and updates to GAO's Policy and Procedures Manual for
Guidance of Federal Agencies. Copies are sent to agency heads,
inspectors general or other agency audit heads, and departmental
financial management offices. Additional copies are sent to other
central locations in various departments and agencies and to
congressional offices, based on specific requests.
Additional copies of this title may be obtained from the
Superintendent of Documents at the Government Printing Office.
Notification of any correction or revisions to the addresses where we
send copies of the Policy and Procedures Manual should be sent to the
following address:
U.S. General Accounting Office:
Office of Information Management and Communications:
Publishing and Communications Center:
Distribution Section, Room 1012:
441 G Street, NW:
Washington, DC 20548:
Any questions about this title can be directed to the General
Accounting Office, Accounting and Information Management Division by
calling (202) 512-9578.
Signed by:
Charles A. Bowsher:
Comptroller General of the United States:
Please retain this transmittal sheet; it is part of the document.
[End of section]
Title 7 Fiscal Guidance:
Introduction:
The guidance in this title is related to the development,
installation, and operation of an agency's fiscal processes in its
financial management system. It is intended to apply within the
framework of the federal accounting principles and standards. However,
this title does not provide specific guidance on fiscal transactions
involving claims by and against the United States; travel and
transportation; or pay, leave, and allowances. Guidance for these
matters is contained in Titles 4, 5, and 6, respectively.
Users of this title will find that they are frequently referred to
guidance such as that published by the Department of the Treasury and
the Office of Management and Budget for related or more detailed
information on certain subjects. In addition, for more detailed or
comprehensive discussions of applicable laws and legal
interpretations, users will often be referred to GAO's Principles of
Federal Appropriations Law.
Terms referenced to the Glossary in this title may be found in GAO's A
Glossary of Terms Used in the Federal Budget Process. The Glossary is
issued and maintained by the Comptroller General under 31 U.S.C. 1112.
This law directs the Comptroller General to establish, maintain, and
publish standard terms and classifications for federal fiscal,
budgetary, and program information. This authority includes, but is
not limited to, data and information pertaining to federal fiscal
policy, revenues, receipts, expenditures, functions, programs,
projects, and activities. Such standardization of terms, definitions,
classifications, and codes assists data users throughout the
government and the private sector.
Agency heads may request a decision from the Comptroller General
concerning application or interpretation of any statute or guidance
set forth in Title 7. Prior to requesting such decisions, agencies
should determine whether their questions have been answered in
previous decisions issued by the Comptroller General. For automated
indices to published Comptroller General decisions, refer to GAO
Documents Data Base or JURIS, or consult Published GAO Decisions,
updated quarterly.
[End of section]
Table Of Contents:
Introduction:
Chapter: 1: Authority And Responsibilities:
Section: 1.1: Definitions:
Section: 1.2: General Authorizations and Requirements:
A. Authority of the Comptroller General:
B. Agency Responsibilities:
Chapter: 2: Appropriation, Receipt, And Fund Accounts:
Section: 2.1: Establishment of Appropriation, Receipt, and Fund
Accounts:
A. Central Accounts of Treasury:
B. Account Symbols and Titles:
C. Appropriation Warrants:
D. Budget Authority Limitations:
E. Regulations:
Section: 2.2: Recording Appropriated Funds:
A. Appropriation Warrants:
B. Issuance of Appropriation Warrants:
1. Definite appropriations:
2. Indefinite appropriations:
3. Resolutions for continuing appropriations:
4. Special and trust funds:
Section: 2.3: Reporting on Appropriation, Receipt, and Fund Accounts:
A. Responsibilities for Reporting Charges and Credits:
1. Responsibilities of Treasury:
2. Responsibilities of agencies:
a. Requirements in law:
b. Related requirements:
B. Limitation Control Requirements:
C. Impoundment and Budgetary Reserves:
Section: 2.4: Transactions Among Appropriation and Fund Accounts:
A. Nonexpenditure Transactions:
B. Expenditure Transactions:
C. Reimbursements Between Government Agencies:
1. Intragovernmental billing and collection system:
2. Agency responsibilities:
3. Interagency disputes:
Chapter 3: Obligations:
Section: 3.1: Applicability:
Section: 3.2: Incurring Obligations:
Section: 3.3: Criteria for Valid Obligations:
A. General:
B. Special Procedures for Contract Change Adjustments to Obligations:
Section: 3.4: Control Over Obligations:
Section: 3.5: Criteria for Recording Obligations:
A. General:
B. Proper Documentation:
C. Contingent Liabilities:
D. Estimating Obligations:
E. Deobligation:
F. Commitments:
G. Obligation Cutoff Procedure:
Section: 3.6: Violations of Obligation Requirements:
A. Exceeding Obligation Limitations and Reporting Requirements:
B. Concealment of an Obligation Violation:
Section: 3.7: Reconciliation and Review of Obligations:
Section: 3.8: Reporting of Obligations:
A. Obligation Reports and Certifications:
B. Additional Guidance on Certifying Obligations:
Chapter: 4: Year-End Closing Of Accounts:
Section: 4.1: Basis for Closing Account Balances:
Section: 4.2 Availability of Appropriations for Obligation:
A. Fixed Period Appropriations:
B. No-year Appropriations:
C. Appropriations Affected by Contract Protests:
Section: 4.3: Crediting of Collections to Appropriations:
Section: 4.4: Closed Appropriations:
Section: 4.5: Controls and Records Requirements for Expired and Closed
Appropriations:
Section: 4.6: Reporting:
Chapter: 5: Collections:
Section: 5.1: Applicability:
Section: 5.2: Control Over Collections:
A. Responsibilities for Collection Controls and Records:
B. Separation of Duties for Cash Receipts:
C. Inscription and Endorsement of Remittances:
Section: 5.3: Deposit and Documentation of Collections:
A. Legal Requirements for Deposit of Receipts:
B. Deposit Requirements:
C. Support for Collections Deposited:
Section: 5.4: Collections Credited to Appropriation and Fund Accounts:
A. Collection Classifications:
1. Refunds:
2. Reimbursements:
B. Crediting Collections to Appropriation and Fund Accounts:
1. Refunds:
2. Reimbursements:
C. Availability of Special Fund Receipts:
1. Available receipts:
2. Unavailable receipts:
3. Accounting:
D. Documentation:
Section: 5.5: Other Collections:
A. Collections by Voucher Deductions:
B. Collections by One Agency for Another:
C. Collections for Unofficial Use of Government Facilities in
Emergencies:
D. Exchange or Sale of Personal Property:
E. Recoveries of Damages:
1. Contract damages:
2. Property damages:
3. Subrogee's recoveries:
F. Collections of Certain Payments From Government Employees:
G. Collections of Debts Owed the Government:
H. Unidentified Remittances:
Chapter: 6 Disbursements:
Section: 6.1: Disbursing Operations:
A. General:
B. Disbursement Functions:
Section: 6.2: Disbursement Forms and Documentation:
A. Forms:
B. Documentation Requirements--General:
C. Documentation Requirements--Alternative Conditions:
1. Use of invoices in place of vouchers:
2. Recurrent payments--fixed amounts:
3. Periodic bills from vendors:
4. Consolidation of payments for multiple invoices:
5. Payments to public utilities:
D. Documentation of Certificated or Unvouchered Payments:
Section: 6.3: Agency Responsibility for Prompt Payments:
Section: 6.4: Approval and Certification of Payment Documents:
Section: 6.5: Prepayment Examination of Vouchers:
A. General Requirements:
B. Special Requirements for Specific Types of Disbursements:
C. Administrative Adjustment of Claims:
Section: 6.6: Internal Controls Over Disbursements:
A. General Requirements:
B. Separation of Duties:
C. Avoiding Duplicate Payments:
D. Disbursements for Accounts Payable of Closed Appropriations:
Section: 6.7: Use of Credit Cards for Purchases:
Section: 6.8: Imprest Funds:
A. Purpose and Amount of an Imprest Fund:
B. Accountability for Imprest Funds:
C. Agency Responsibilities:
D. Verifications and Audits of Imprest Funds:
Section: 6.9: Grants and Cooperative Agreements:
Section: 6.10: Periodic Reviews"
Chapter: 7: Concepts Of Federal Accountability And Responsibilities Of
Accountable Officers:
Section: 7.1: Accountability Concept:
A. Responsibilities of Certifying Officers:
B. Responsibilities of Disbursing Officers:
Section: 7.2: Reliance on Systems and Related Controls:
A. Shifting Emphasis Due to Automation:
B. Reasonableness of the Reliance on Systems and Controls:
Section: 7.3: Organizational Structure and Operating Procedures:
Section: 7.4: Application of Available Technology and Concepts:
A. Technology Provides Voucher Examining Alternatives:
B. Computer Edits:
C. Data Authentication and Electronic Certification:
D. Fast Pay Procedures:
E. Statistical Sampling:
F. Combining Fast Pay Procedures and Statistical Sampling:
G. Requests for Alternative Procedures:
Section: 7.5: Evaluations of the Voucher Processing System and
Controls:
A. Review Requirements:
B. Using FMFIA Reviews:
C. Special Requirements for Certification, Processing, and Reporting
if Weaknesses Exist:
Chapter: 8: Settlement Of Accounts And Relief Of Accountable Officers:
Section: 8.1: Authority and Responsibility:
Section: 8.2: Definition of Fiscal Irregularity:
Section: 8.3: Right to an Advance Decision on Certification or Payment:
Section: 8.4: Agency Responsibilities:
A. General:
B. Reporting Irregularities:
C. Submitting Reports to GAO:
Section: 8.5: The Settlement Process:
Section: 8.6 Issuance of Exceptions to Certifying or Disbursing
Officers:
A. Replies to Exceptions:
B. Acknowledgment of Replies:
C. Reporting Repayments:
D. Agency Responsibility:
Section: 8.7: Time Limitation on Settlement of Accounts:
Section: 8.8: Relief of Accountable Officers: General:
Section: 8.9: Physical Loss or Deficiency:
A. Standards for Relief:
B. GAO Determination for Losses of $3,000 or More:
C. Agency Determination for Losses Under $3,000:
Section: 8.10: Physical Loss or Deficiency: Department of Defense
Disbursing Officers:
A. Standards for Relief:
B. Agency Determinations:
Section: 8.11: Improper Payment:
A. Standards for Relief: Disbursing Officers:
B. Standards for Relief: Certifying Officers:
C. Certain Check Losses:
D. Required Collection Efforts:
Section: 8.12: Required Documentation:
A. Reportable Irregularities:
B. Irregularities Resolved by the Agency:
C. Requests for Relief Submitted to GAO:
D. Subsequent Developments:
Section: 8.13: Where to Submit Requests for Relief:
Section: 8.14: Adjustment of Accounts:
A. General:
B. Relief Granted by GAO:
C. Relief Granted by the Agency:
D. Relief Denied or Agency Declines to Seek Relief:
E. Other Situations:
Appendixes:
I: Standard and Optional Forms:
II: Treasury Department-General Accounting Office Joint Regulations:
III: Use of Statistical Sampling Procedures in Examination of Vouchers
for Payment:
IV: Special Requirements for Certain Types of Disbursements:
V: Selected Legal Citations Directly Affecting Budgetary and Financial
Accounting:
VI: Transition Period for Closing Accounts:
Index:
Figure 4.1: Illustration of Appropriations Account Closing for Fixed
Period Appropriations:
Abbreviations:
ANSI: American National Standards Institute:
C.F.R. Code of Federal Regulations:
Comp. Gen. Comptroller General:
FAR: Federal Acquisition Regulation:
FAST: Federal Account Symbols and Titles:
FIPS: Federal Information Processing Standards:
FIRMR: Federal Information Resource Management Regulations:
FMFIA: Federal Managers' Financial Integrity Act:
GAO: General Accounting Office:
GOALS: Government On-line Accounting Link:
GSA: General Services Administration:
OMB: Office of Management and Budget:
OPAC: On-line Payment and Collection:
NIST: National Institute of Standards and Technology:
SIBAC: Simplified Intragovernmental Billing and Collection:
U.S.C.: United States Code:
[End of section]
Chapter 1: Authority And Responsibilities:
1.1 Definitions:
Unless otherwise provided in this title, the terms "agency,"
"executive agency," and "government corporation" are used as follows:
* "Agency" means a department, agency, or instrumentality of the
United States government;
* "Executive agency" means a department, agency, or instrumentality of
the executive branch of the United States government, but does not
include government corporations; and;
* "Government corporation" means a corporation, agency, or
instrumentality subject to chapter 91 of title 31, U.S. Code.
1.2 General Authorizations And Requirements:
General authorizations and requirements for agency accounting and
auditing are set forth in numerous statutes, primarily in chapter 35
of title 31, U.S. Code. For selected U.S. Code excerpts, see appendix
V.
A. Authority of the Comptroller General:
Agency accounting and auditing requirements are established by the
Comptroller General pursuant to various authorities in the U.S. Code.
The fiscal guidance in this title is based on the Comptroller
General's authority to settle the accounts of accountable officers and
conduct audits. Included in this title are general accounting
processing procedures which are required by law, federal accounting
principles and standards, or internal controls. As part of the federal
accounting standard setting process, GAO, OMB, and Treasury created
the Federal Accounting Standards Advisory Board to review and
recommend revisions, as necessary, to federal agency accounting
standards. Compliance with the guidance in this title will provide a
high degree of assurance that the systems are functioning in
accordance with required practices.
GAO has prescribed appropriation accounting symbols, titles, and forms
as part of its responsibilities. However, since December 1, 1950, the
responsibility for assigning receipt, expenditure, basic working fund,
and official deposit account symbols and titles, consistent with GAO
guidance, has been assigned to the Department of the Treasury (GAO
General Regulation No. 84, 2nd Revision, November 20, 1950, 30 Comp.
Gen. 541). Section 2.2 of this title contains a further discussion of
the account symbols and titles. Responsibilities for standard
accounting forms relating to fiscal operations were also delegated to
those agencies having basic functional responsibilities for the areas
associated with the forms (Title 7 transmittal number 7-34, October 1,
1967). Agencies should comply with requirements referenced in appendix
I on standard, optional, and agency accounting forms.
B. Agency Responsibilities:
The head of each executive agency is responsible for establishing and
maintaining adequate accounting and internal control systems, in
conformity with federal accounting principles, standards, and related
requirements (31 U.S.C. 3512). Agency heads are also responsible for
evaluating and reporting annually to the President and Congress on
whether their internal controls comply with applicable standards, and
for those controls that do not, reporting agency plans for corrective
actions (31 U.S.C. 3512(d)). Internal controls are viewed as being
synonymous with management controls--the whole network of policies,
procedures, practices, and systems used by managers.
Excepted agencies, which include the Supreme Court and the various
legislative branch agencies, are urged to comply with this guidance in
order to facilitate the consolidation and reporting of the
government's financial information, unless compliance would impose an
unreasonable burden or be in conflict with a provision of law.
[End of Chapter 1]
Chapter 2: Appropriations, Receipt, and Fund Accounts:
2.1 Establishment Of Appropriation, Receipt, And Fund Accounts:
A. Central Accounts of Treasury:
Except where the Congress may have legislated specifically to the
contrary, all public funds shall be deposited in and/or spent from one
or more federal fund, trust, transfer appropriation, receipt clearing,
foreign currency, deposit accounts, or direct loan or loan guarantee
financing accounts maintained by Treasury. For a more detailed
description of these account types, see the Glossary and the Treasury
Financial Manual, volume I, part 2, section 1500.
B. Account Symbols and Titles:
Appropriation, receipt, and fund account symbols and titles are
assigned by Treasury in consultation with the Office of Management and
Budget (OMB), and in compliance with the principles, standards, and
related requirements prescribed by the Comptroller General. An account
symbol is a group of numbers or a combination of numbers and letters
used in accordance with a prescribed system of account classification
and identification for denoting the agency responsible for the
account, the period of availability, and the fund classification.
The assigned, amended, or discontinued Federal Account Symbols and
Titles (FAST) are published quarterly by Treasury as a supplement to
the Treasury Financial Manual. This periodic listing provides each
fund group's symbols and titles along with U.S. Code or Statutes at
Large citations.
In addition to each fund having unique symbol and title designations
to assist with centralized reporting, all fund transactions are to be
recorded in appropriate accounts as set forth in the U.S. Government
Standard General Ledger chart of accounts. The Standard General Ledger
is published as a supplement to the Treasury Financial Manual. It is
to be used to standardize agency accounting and to support the
preparation of standard reports between an agency and Treasury for its
centralized accounting and reporting responsibilities, and between an
agency and OMB, the President, and the Congress for budgetary
accounting needs.
By means of the accounting system's coding and classification
structure, agencies should be able to summarize and report their
financial data in both proprietary and budgetary terms, and on either
a consolidated basis or by individual appropriation or fund account.
(More detailed guidance regarding the integration and configuration of
the primary and subsidiary systems that carry out an organization's
financial operations can be found in OMB Circulars A-11 and A-127 and
in appendix III of Title 2 of this manual.)
C. Appropriation Warrants:
Funds appropriated are drawn from the Treasury by means of an
appropriation warrant (TFS Form 6200, Treasury Financial Manual,
volume I, part 2, chapter 2000). A warrant is the official document
issued pursuant to law by the Secretary of the Treasury that
establishes the amount of money authorized to be withdrawn from the
Treasury and accounted for in agency accounts. (See the Glossary.)
Under Treasury Department--General Accounting Office Joint Regulations
No. 5 and No. 7 (see appendix II), all requirements of existing law
for GAO to countersign warrants are waived.
D. Budget Authority Limitations:
A limitation of budget authority in agencies accounts is imposed by
law or by agencies pursuant to law and serves to restrict:
1. the purpose for which budget authority may be obligated or expended,
2. the amount of budget authority that may be obligated or expended
for a particular purpose, or.
3. the time period during which budget authority may be obligated or
expended.
A limitation prescribing the maximum amount for certain programs or
purposes during a specified period may be contained either in an
authorization or appropriation statute.
E. Regulations:
Where applicable, Joint Regulations 1 through 7, issued by the
Secretary of the Treasury and the Comptroller General, have been
incorporated into this title. They are included as appendix II for the
purpose of maintaining a historical record.
2.2 Recording Appropriated Funds:
A public law appropriating moneys is the basis for issuing
appropriation warrants (31 U.S.C. 321(a)(3) and 3323). The warrants,
initiated pursuant to law by the Secretary of the Treasury, are the
basis for recording appropriations on the books of Treasury and in the
reciprocal accounting records of all other agencies for which the
appropriations are made. All regular and continuing resolution
appropriation warrants are signed only by a Treasury representative.
A. Appropriation Warrants:
Appropriations do not represent cash actually set aside in the
Treasury for the purposes specified in the appropriation act but are
amounts which agencies may obligate for the purposes and during the
time periods specified in the appropriations acts.
B. Issuance of Appropriation Warrants:
1. Definite appropriations:
Warrants will be issued in the full amounts for definite
appropriations from the general fund of the Treasury, i.e., those
stated in specific amounts in the appropriation acts.
2. Indefinite appropriations:
For indefinite appropriations from the general fund of the Treasury,
that is where the amount is determinable at some later date, warrants
normally will be issued at the beginning of each fiscal year, after
approval by OMB and in the amounts of the latest published estimates
of OMB. The warrants will be subsequently adjusted, as appropriate, to
actual obligations or payments.
3. Resolutions for continuing appropriations:
Where budget authority is provided by continuing resolutions, pending
enactment of regular appropriations for the fiscal year, warrants
shall be issued in strict accordance with the provisions of the
continuing resolutions. Agencies shall request warrants under the
continuing resolutions in accordance with the prescribed OMB
apportionment and furnish Treasury with adequate written justification
for the amounts being requested. Requests for deviations from a
quarterly apportionment shall be justified in writing to OMB and
approved by OMB before agencies request warrants from Treasury.
4. Special and trust funds:
Special and trust fund receipts which, pursuant to law, are available
without further action by the Congress will be available immediately
upon confirmation of their deposit. For unavailable special and trust
fund receipts, warrants will be issued after requirements for their
availability have been met. (See definitions of "available" and
"unavailable" receipts in subsection 5.4.0 of this title.)
2.3 Reporting On Appropriation, Receipt, And Fund Accounts:
A. Responsibilities for Reporting Charges and Credits:
1. Responsibilities of Treasury:
Treasury is responsible for prescribing detailed procedures executive
agencies use for processing transactions among appropriation, receipt,
and fund accounts and for obtaining from each agency such summary-
level account information relating to transactions and reports as may
be necessary for carrying out its central accounting and financial
reporting responsibilities (31 U.S.C. 3513).
2. Responsibilities of agencies:
a. Requirements in law.
Executive agencies are responsible under 31 U.S.C. 3512 for
establishing and maintaining the following.
(1) The appropriate accounts designated by Treasury.
(2) Such subsidiary records as may be necessary for accounting, audit,
and management purposes, including accounts under the consolidated
working fund account symbols assigned by Treasury.
(3) Controls for appropriation(s) and special limitations required by
law.
(4) Reliable accounting results that will be the basis for:
(a) preparing and supporting the budget requests of the agency,
(b) controlling the execution of the agency budget, and,
(c) providing financial information that the President requires under
31 U.S.C. 1104(e).
(5) Suitable integration of the agency's accounting with the central
accounting and reporting responsibilities of the Secretary of the
Treasury under 31 U.S.C. 3513.
b. Related requirements:
Accounting symbolization must be maintained accurately to facilitate
the operation of information systems designed to:
(1) assure compliance with restrictions on the receipt or expenditure
of certain budgetary resources,
(2) permit presentation of comparable information for analysis of
trends in certain accounts, and,
(3) provide information to Treasury for the central accounts of the
government.
Agencies are required to report charges and credits to appropriation,
receipt, or fund accounts consistent with the fund account symbols and
titles, and the Standard General Ledger uniform chart of accounts. In
addition, agencies are responsible for complying with Treasury
requirements for furnishing documents, reports, and information on the
charges and credits to the separate appropriation, receipt, and fund
accounts. The reported amounts will be posted to the reciprocal agency
accounts maintained by Treasury.
Agencies are responsible for maintaining adequate documentation and
control over charges and credits to appropriation receipt or fund
accounts. This responsibility is part of the overall responsibility
for maintaining systems designed to ensure that financial transactions
are in conformity with legal requirements. (See also subsections
2.1.D, 2.3.B, and chapter 3, obligations, on the topic of control.)
B. Limitation Control Requirements:
Budget authority limitations imposed by law or agency management (as
described in 2.1.D) are intended to achieve an effective and orderly
use of available authority and to reduce the need for supplemental or
deficiency appropriations. Generally, this limitation control process
begins with the apportionment (of appropriations or other budgetary
resources) which, in turn, is allotted pursuant to the apportionment
or other statutory authority (31 U.S.C. 1513, 1514). Such limitations
should be accounted for in the Standard General Ledger's budgetary
(4000 series) accounts. OMB apportions budgetary resources for
executive branch agencies. For legislative and judicial branch
agencies, the official who has administrative control of budgetary
resources performs the apportionment. In some cases, separate
allotments may be required to establish effective control over funds
subject to limitations.
Agencies are precluded by the Antideficiency Act from (1) incurring
obligations or expenditures in excess of the amounts available in
appropriations, fund accounts, or apportionments or (2) from
obligating or expending amounts required to be sequestered (31 U.S.C.
1341, 1517(a)(1)). Agencies are also precluded from exceeding
allotments, suballotments, or other subdivisions of funds when agency
regulations make the exceeding of such administrative divisions a
violation of the law (31 U.S.C. 1517(a)(2)). In addition, the
Antideficiency Act requires agency heads to establish fund control
systems that can be used to identify agency staff responsible for
causing obligations or expenditures to exceed limitations. OMB has
directed executive agencies to always treat obligations in excess of
allotments or suballotments as violations of the Antideficiency Act.
(See OMB Circular A-34, sections 21.1, discussion relating to
"administrative subdivision of funds," and 32.1 through 32.7.)
Agencies administering appropriation and fund accounts are responsible
for ensuring that the amount obligated does not exceed the legally
imposed limitations (e.g., limitations established by legislation,
apportionment, allotment, or other administrative subdivision). They
are also responsible for establishing such records or accounts and for
preparing such reports as may be necessary for ensuring compliance
with the limitation(s). (See section 3.6.)
These fund controls are to be maintained as part of the accounting
records. (For more detailed control requirements discussions, see
accounting standards for fund control in Title 2, appendix I, section
F50; accounting system standards in Title 2, appendix III, chapter 2;
and OMB instructions on internal control systems and accounting
systems in Circulars A-34 (part III and appendix B), A-123, and A-
127.) Where a limitation is stated in number of units (e.g., the
number of automobiles that may be purchased) instead of dollars,
controls should be maintained in terms of units, rather than dollars.
C. Impoundment and Budgetary Reserves:
An impoundment is any action or inaction by an officer or employee of
the federal government that is intended to withhold the obligation or
expenditure of budget authority. There are two types of impoundment
action--deferral and rescission.
A deferral is a withholding or delaying of the obligation or
expenditure of budget authority or any other type of executive action
which effectively precludes the obligation or expenditure of budget
authority. No officer or employee of the United States may defer any
budgetary authority for any purpose other than to provide for
contingencies or to effect a savings made possible by or through
changes in requirements or greater efficiency of operations, or as
otherwise specifically provided by law. Deferrals may not extend
beyond the end of the fiscal year. A special message from the
President to the Congress is required by 2 U.S.C. 684 to report any
deferral of budget authority. Apportionments or reapportionments that
establish reserves under 31 U.S.C. 1512(c) are deferrals and must be
reported under 2 U.S.C. 684.
A rescission involves the cancellation of budget authority previously
provided by the Congress (before that authority would otherwise
expire), and can only be accomplished through legislation. The
President is required to advise the Congress of any proposed
rescissions in a special message (2 U.S.C. 683). Any amount of budget
authority proposed to be rescinded shall be made available for
obligation unless, within 45 days of continuous session following
receipt of the proposal, both Houses of Congress pass a bill
rescinding, in whole or in part, previously granted budget authority.
Funds made available for obligation under this procedure may not be
proposed for rescission again in the same fiscal year.
The Comptroller General is required to monitor the performance of the
executive branch in reporting proposed deferrals and rescissions to
the Congress. A copy of each special message reporting a proposed
deferral or rescission must be delivered to the Comptroller General,
who must review each such message and present the results to the
Senate and House of Representatives.
During this review, the Comptroller General may determine that the
executive branch has incorrectly classified an impoundment. In the
report to the Congress, the Comptroller General may reclassify
impoundments from one type to the other (2 U.S.C. 685686). In
addition, the Comptroller General is required to report to the
Congress any action by the executive branch which establishes a
reserve or defers, or proposes to defer, budget authority without
transmitting the required special message to the Congress. Finally,
the Comptroller General is authorized to bring a civil action against
an agency to make available for obligation budget authority that has
been improperly withheld from obligation (2 U.S.C. 687).
2.4: Transactions Among Appropriation And Fund Accounts:
Transfer of funds among appropriation and fund accounts is prohibited,
except as authorized by law. This rule follows from the requirements
of 31 U.S.C. 1532, which prohibits transfers, and 31 U.S.C. 1301(a),
which prohibits the use of appropriations for other than their
intended purpose. (See, for example, 33 Comp. Gen. 214 (1953) and 216
(1953); B-178205, April 13, 1976; and B-206608, March 15, 1982. Also,
see GAO's Principles of Federal Appropriations Law.).
The prohibition against transfer without statutory authority applies
equally to transfers among separate appropriations and fund accounts
available to an agency or among agencies. An example of general
statutory authority for interagency and intra-agency fund transfers is
the Economy Act (31 U.S.C. 1535 and 1536).
A. Nonexpenditure Transactions:
The requirements applicable to nonexpenditure transactions set forth
in this subsection shall apply to all agencies.
For accounting and reporting purposes, those transactions among
appropriation and fund accounts that do not represent payments for
goods and services received or to be received, but serve only to
adjust the amounts available in the accounts for making payments,
shall be classified as nonexpenditure transactions (e.g., use of
transfer appropriation accounts or commonly known as "allocation
accounts"). However, transactions between budget accounts and deposit
funds will always be treated as expenditure transactions since the
deposit funds are outside the budget. Nonexpenditure transactions are
not to be recorded as obligations or outlays of the transferring
accounts nor as reimbursements or receipts of the receiving accounts.
No change may be made in the availability of appropriated funds by
agencies through the use of nonexpenditure transactions unless
specifically authorized by law.
B. Expenditure Transactions:
For accounting and reporting purposes, expenditure transactions are
transactions among appropriation and fund accounts that represent
payments, repayments, or receipts for goods or services furnished or
to be furnished. An expenditure transfer/transaction is recorded as a
obligation/outlay of the transferring account and as unearned customer
orders or reimbursements of the receiving account, as specifically
authorized by law. If the receiving account is a general fund
appropriation account or a revolving fund account, the collection is
credited to the appropriation or fund account. If the receiving
account is a special fund or trust account, the collection is usually
credited to a receipt account of the fund. All transfers between
federal funds (general, special, and nontrust revolving funds) and
trust funds are also treated as expenditure transactions.
C. Reimbursements Between Government Agencies:
1. Intragovernmental billing and collection system:
The intragovernmental billing and collection system facilitates
interagency transfers of funds in compliance with specific provisions
of law. Two essential elements of the system are that it provides for
immediate payment to the billing agency and it incorporates a method
for customer agencies to charge back erroneous charges. However, all
the requirements of the law authorizing an interagency agreement or
controlling the accounting for the budget authority made available to
implement the agreement must be followed. Further, in order to
facilitate implementation and audit, the documentary record of the
agreement should always cite the authority for the agreement.
Certain automated intragovernmental billing and collection subsystems
have been established to accomplish intragovernmental purchases and
sales and the resulting payments in the most efficient manner. These
objectives are achieved by eliminating:
a. check issuance and deposit procedures, and.
b. paper voucher procedures, when applicable, through simultaneous
billing and collection with interfacing computer systems.
Based on these interagency automated record systems, Treasury also
processes charges and credits for the interagency transactions in its
control records for each agency.
For a description of the general requirements and technical
specifications for these intragovernmental billing and collection
subsystems, see Treasury Financial Manual, volume I, part 6, section
5000, for the Simplified Intragovernmental Billing and Collection
(SIBAC) System and section 10000, for the On-Line Payment and
Collection (OPAC) System, a component of the Government On-Line
Accounting Link System (GOALS).
If the requesting agencies lack access to Treasury's automated billing
and collection system, they should ensure that bills rendered or
requests received for advances are promptly paid.
When intragovernmental billing and collection actions are completed
prior to receiving notification of receipt for supplies or services,
paying agencies should establish the necessary controls, which may
include recording payments as deferred items, to ensure ultimate
receipt or other appropriate settlement of the transaction.
2. Agency responsibilities:
To ensure proper fund control and minimize the potential for violation
of the Antideficiency Act, certain safeguards should be incorporated
into agency procedures and into interagency or intra-agency orders or
agreements for goods or services.
The extent to which controls are applied is related to the risk
involved. For example, minimal controls may be sufficient when there
is little risk that the amounts to be billed will exceed the initial
cost estimates. The following safeguards apply but the application
should be adjusted to reflect differences in circumstances or
requirements.
a. The requesting organization must ensure that it has budget -
authority available prior to placing an order or entering into an
agreement for goods or services.
b. The performing agency should specify the amount that it is to be
paid for providing the requested item or service. If the law
authorizes, but does not require, performance on a nonreimbursable
basis, the parties should agree whether reimbursement is appropriate.
The amount should be determined in accordance with the requirements
imposed by the law authorizing the agreement. For example, 31 U.S.C.
1535 and 1536 require the recovery of actual costs, including direct
and indirect costs. When the total cost of performance is not known in
advance, costs should be estimated, and this estimated amount should
constitute a ceiling on the costs that may be incurred by the
performing agency without notifying, and receiving approval from, an
authorized official of the requesting agency.
c. The requesting agency is required to obligate budget authority in
the amount specified in the agreement and institute procedures to
monitor the cost and performance.
d. When the law requires that the performing agency recover actual
costs for the items or services provided and advances by the
requesting agency exceed the actual costs of performance, the excess
should be refunded promptly upon completion of performance or
termination of the order by the requesting agency. (For example, the
prompt return of excess funds may be critical to the requesting agency
so that funds can be used before they expire.)
e. The agreement should be properly documented. (See subsection
3.5.B.) It should, as a minimum, set forth:
(1) citations of the legal authority for entering into the agreement,
(2) the terms and conditions of the requested performance,
(3) the specified cost of performance, including appropriate ceilings
when the cost is based on estimates (or the designation
"nonreimbursed" when authorized and agreed to by the performing agency),
(4) whether payment will be by advance or reimbursement,
(5) applicable special requirements and procedures for assuring
compliance (see, for example, 48 C.F.R. subpart 17.5, "Interagency
Agreements Under the Economy Act"), and,
(6) the approval of the agreement by authorized officials of the
participating organizational units.
f. The performing agency should institute procedures for adminiStering
the agreement. The procedures should ensure that the specified cost
and applicable time limit on the use of the funds to produce the goods
or perform the service are not exceeded and that all costs are
promptly billed. Whenever implementation is through more than one
organizational unit, the performing agencies should centrally
coordinate and administer performance and billings to ensure that the
specified costs are not exceeded.
In addition, the requesting agency's appropriation remains obligated
for an order placed or agreement made under the Economy Act only to
the extent that the performing agency provides or enters into a
contract with commercial establishments to provide the requested goods
or services before the appropriation expires. Thus, when agreements
are entered into under that authority, amounts obligated by the
requesting agency will require deobligation at the expiration of the
appropriation to the extent that goods or services have not been
provided or contracted for by the performing agency. However,
agreements entered into under other provisions of law generally
obligate appropriations in a manner similar to contracts with
commercial establishments. (See 55 Comp. Gen. 1497 (1976).)
g. If it becomes evident that the goods or services to be provided
will exceed the estimated costs, the performing agency should
immediately notify the requesting agency and curtail or cease
performance, as necessary, to avoid exceeding the estimated cost.
Failure in this regard may result in the performing agency violating
31 U.S.C. 1301(a) and 1341(a) (B-234427, August 10, 1989).
h. If the requesting agency desires continued performance, and budget
authority is available, the agreement should be modified accordingly
at the earliest practical time.
3. Interagency disputes:
A disputed interagency bill for goods or services, together with
applicable documents and reports, may be submitted for settlement to
the following address:
Claims Group:
General Government Division:
U.S. General Accounting Office:
441 G Street, NW:
Washington, DC 20548:
[End of Chapter 2]
Chapter 3: Obligations:
3.1 Applicability:
This chapter presents general legal guidance applicable to accounting
for and reporting on obligations against appropriation and fund
accounts. Related fund control accounting and reporting standards are
covered in Title 2, appendix I, section F50, and appendix III, chapter
2. A "Checklist for Fund Control Regulations" is prescribed in Office
of Management and Budget Circular A-34, appendix B, pursuant to 31
U.S.C. 1514(a).
The term "appropriation" as used in this chapter is the statutory
authority for federal agencies to incur obligations and make payments
from Treasury for specified purposes. The word usually has been used
in this way in the referenced statutes and Comptroller General
decisions because the Antideficiency Act defined the term
"appropriations" broadly. (See the definition of budget authority
contained in the Glossary.) As discussed in section 5.4 of this title,
the meaning of the term also includes collections credited to
appropriation or fund accounts.
3.2 Incurring Obligations:
In simplified terms, obligations are incurred when transactions
representing orders placed, contracts awarded, services received, and
other actions during a given period will require payments during the
same or some future period. Obligations must satisfy legal
requirements before they can be properly recorded against
appropriation accounts.
3.3 Criteria For Valid Obligations:
Legal decisions regarding "obligations" issues are often stated in
terms of whether appropriations are "legally available" for a given
expenditure. This is simply another way of stating whether using an
appropriation for a given item is a valid obligation. The following
criteria must be met in order for appropriations to be legally
available for obligation and expenditure.
A. General:
1. The purpose of the obligation must be one for which the
appropriation was made (31 U.S.C. 1301(a)).
2. The obligation must be incurred within the time that the
appropriation was made available for new obligations
3. The obligation may not exceed the amount appropriated by statute,
nor be incurred before the appropriation becomes law, unless otherwise
provided by law (31 U.S.C. 1341 and 41 U.S.C. 11).
Thus, there are three elements to the concept of appropriations being
available for obligations: purpose, time, and amount. The requirements
of all three elements must be observed for the obligation to be
legally valid, unless otherwise authorized by law. These elements of
the obligation concept must be applied to each transaction.
Administrative discretion concerning the use of appropriations may not
contravene the requirements or limitations imposed by the
appropriation acts or other applicable provisions of law. For further
discussion of the "concept of obligation" and appropriation
availability refer to GAO's Principles of Federal Appropriations Law.
When an agency is authorized by law to incur obligations in advance
of, or in excess of, an appropriation, the obligation must be recorded
as soon as it arises. The incurring and recording of the obligation in
such circumstances does not violate 31 U.S.C. 1341 and 41 U.S.C. 11,
since the deficiency obligation is authorized by law (65 Comp. Gen. 4
(1985)). However, appropriate steps should be taken to ensure that
liquidating appropriations are obtained to pay the obligation.
In those instances when an appropriation is obligated for a purpose
for which it is not available, agencies must make an adjustment and
charge the proper appropriation. If there is no appropriation
available for the purpose, or the obligation is in excess of the
amount available in the proper appropriation, there is a violation of
31 U.S.C. 1341.
B. Special Procedures for Contract Change Adjustments to Obligations:
Certain obligation increases relating to contract changes for expired
fixed period appropriations require special approval and reporting as
set forth in 31 U.S.C. 1553(c). After the contract changes reach a
total of $4 million during a fiscal year within a program, project, or
activity of an appropriation, any obligation increases for contract
changes must be approved before being incurred. The approval must be
given by the agency head or an officer in the agency head's immediate
office who is delegated such authority by the head of the agency.
If the total amount of anticipated obligations for contract changes
will exceed $25 million within a program, project, or activity of an
appropriation, the obligations may not be incurred until:
1. the agency head provides a written notice of the obligations to the
appropriate authorizing committees of the Congress and the House and
Senate Committees on Appropriations and,
2. a period of 30 days has elapsed after the submission of the notice.
The notice must include a description of the legal basis and the
policy reasons for the proposed obligations (31 U.S.C. 1553(c)).
The term "contract change" means a change to a contract, including
agreements between government agencies, under which the contractor is
required to perform additional work. The term does not include
adjustments to pay claims or increases under an escalation clause. In
the absence of any other applicable guidance, an agency may identify a
program, project, or activity under 31 U.S.C. 1553(c) consistent with
program, project, or activity as identified for the purpose of
sequestration under section 256(1)(2) of the Balanced Budget and
Emergency Deficit Control Act of 1985, as amended (2 U.S.C. 906(1)(2)).
3.4 Control Over Obligations:
Agencies shall institute appropriate control procedures for ensuring
that all obligations entered into on behalf of the government,
including interagency transfers for reimbursable work, are made in
accordance with law and are documented, recorded, and reported as
required by law. Such procedural controls should be integrated with
agency budgetary and accounting fund control systems. For more
detailed guidance, see OMB Circular A-34 and GAO Title 2, appendix
III, chapter 2.
Accounting systems shall be designed to help prevent obligations from
exceeding the amounts of appropriations, statutory limitations,
apportionments, or administrative subdivisions thereof (31 U.S.C.
1514), which are set in response to statutory, presidential (through
OMB), and agency management guidance. To preclude such
overobligations, the system should be capable of providing positive
knowledge that funds are available to cover obligations being entered
into or anticipated. In addition, written agency procedures are to
clearly state how the availability of funds may be determined. The
records maintained are to show, in all cases, the available balance of
each limitation; the amounts obligated, expended, and disbursed; and
the balance remaining.
3.5 Criteria For Recording Obligations:
A. General:
All obligations shall be promptly charged against the applicable
appropriations in such a manner as to meet the requirements for
control of funds, essential management information, and the
preparation of statements and required reports.
The overrecording and underrecording of obligated amounts are equally
improper. Either makes it impossible to determine the precise status
of the appropriation and may cause violations of the Antideficiency
Act. Either will also call into question the propriety of
certifications of obligations that must be submitted with
appropriation requests. (See subsection 3.8.A.)
B. Proper Documentation:
Documentary requirements for recording obligations incurred in the
course of government activity are provided in 31 U.S.C. 1501(a). This
provision specifically directs that no amount shall be recorded as an
obligation unless.it is supported by documentary evidence of the
following.
1. A binding agreement between agencies or an agency and other parties
that is:
a. in writing, in a way and form, and for a purpose authorized by law,
and,
b. executed before the end of the period of availability for
obligation of the appropriation or fund used for specific goods to be
delivered, real property to be bought or leased, or work or service to
be provided.
2. A loan agreement showing the amount and terms of repayment.
3. An order required by law to be placed with an agency.
4. An order issued under a law authorizing purchases without
advertising:
a. when necessary because of a public exigency,
b. for perishable subsistence supplies, or
c. within specific monetary limits.
5. A grant or subsidy payable:
a. from appropriations made for payment of, or contributions to,
amounts required to be paid in specific amounts fixed by law or under
formulas prescribed by law,
b. under an agreement authorized by law, or,
c. under plans approved consistent with and authorized by law.
6. A liability that may result from pending litigation.
7. Employment or services of persons or expenses of travel under law.
8. Services provided by public utilities.
9. Other legal liability of the government against an available
appropriation or fund.
See chapters 31 and 33 of title 44, U.S. Code for general guidance on
agency management and disposal of "records." See also, Title 8 of this
manual concerning records management.
C. Contingent Liabilities:
Contingent liabilities become recordable obligations if or when the
contingent condition materializes. For example, flood insurance
contracts and unadjudicated claims against the government are
contingent liabilities. If the insured risk occurs, or the claimant
prevails, the contingent liability becomes an obligation which must be
recorded based on the appropriate documentary evidence against the
current appropriation for the purpose of paying such obligations. The
full amount of the obligation is to be recorded even when the
available obligational authority is insufficient to cover the
obligation (65 Comp. Gen. 4 (1985)). For additional guidance with
respect to proprietary accounting, see GAO's Title 2, appendix I,
section C50.
Also, in suits against the government where one of the disputed issues
is the underlying legal liability of the government to the plaintiff,
the contingency does not warrant the recording of an obligation.
However, where the underlying legal liability of the government on the
claim is not in question (for example, in property condemnation
cases), and only the amount of the claim is in dispute, a recordable
obligation exists. The obligation should be estimated in accordance
with subsection 3.5.D. (See 35 Comp. Gen. 185 (1955) and 34 Comp. Gen.
418, 423 (1955).)
D. Estimating Obligations:
When the amount of an obligation is not known at the time it is
incurred, the best possible estimate should be used to record the
obligation. Where an estimate is used, the basis for the estimate and
the computation must be documented. Appropriate adjustment must be
made when events permit a more accurate estimate of the amount of the
obligation and when the actual obligation is determined. In situations
where estimated obligations would potentially result in exhausting the
unobligated balance of the appropriation at that time, the agency
should initiate steps to obtain additional budget authority. For
example, liabilities arising based on indemnification agreements
(contingent liabilities) that could exhaust funds which would
otherwise be available.
E. Deobligation:
Deobligation is the cancellation or downward adjustment of a
previously recorded obligation. In general, the rules for initially
obligating the appropriation also apply to any amounts deobligated.
Appropriations deobligated within the original period of obligational
availability are again available for new obligations. Amounts
deobligated after the expiration of a fixed period appropriation may
increase the unobligated balance of the expired appropriation but are
not available for new obligations. However, the unobligated balances
of expired appropriations are available for the purpose of recording
unrecorded or underrecorded obligations properly entered into prior to
the expiration of the appropriation. Any unrecorded or underrecorded
obligation charged against an expired appropriation that exceeds the
unobligated balance of that appropriation may result in a violation of
the Antideficiency Act.
For no-year appropriations, deobligations increase the unobligated
balances and are available for new obligations until the appropriation
is closed. For more discussion of expired account balances, see
chapter 4 of this title.
F. Commitments:
For purposes of effective financial planning, including fund control,
data on proposed obligations, which are often referred to as
"commitments," may be systematically accumulated in accounting records
in advance of their becoming valid obligations.
If used, this accounting procedure reflects allotments or other
available funds which are earmarked in anticipation of obligation.
Such a commitment procedure is particularly useful when there is a
significant delay between the initial prevalidation and the later
actual obligation of funds, or when there are multiple locations
receiving allotments from one appropriation.
The Standard General Ledger accommodates recording the commitment
process through the "Commitments Available for Obligation" account.
Commitments can only be recorded against funds that have been
apportioned and allotted or otherwise made "available." However,
commitments representing such anticipated obligations are not included
in any official reports on obligations incurred, as they do not meet
the criteria for recording obligations as presented in this section.
G. Obligation Cutoff Procedure:
Each agency shall establish a reasonable cutoff date for (1) recording
obligations which are applicable to the fiscal year but received after
the close of the fiscal year and (2) making any necessary adjustments
in amounts of recorded obligations. Sufficient time must be allowed
after the cutoff date for making adjustments and preparing the annual
reports of obligations, Treasury SF 225, Report on Obligations, and
OMB SF 133, Report on Budget Execution. For further detailed
instructions on yearend obligation reports, see the Treasury Financial
Manual, volume I, part 2, chapter 4400, and OMB Circular A-34, part V.
3.6. Violations Of Obligation Requirements:
A. Exceeding Obligation Limitations and Reporting Requirements:
The language of 31 U.S.C. 1341 makes clear that it is improper to
authorize an expenditure or obligation of an appropriation or fund in
excess of amounts available or before an appropriation is made, unless
authorized by law; or for the expenditure or obligation of funds or
payment of money required to be sequestered.
The language contained in 31 U.S.C. 1517(a) prohibits making or
authorizing an obligation or expenditure exceeding an apportionment or
the amount permitted by regulations prescribed under 31 U.S.C. I514(a)
relating to the administrative division of apportionments.
If an obligation has been created in excess of available funds, the
law has been violated, regardless of whether the obligation has been
recorded against an appropriation or fund. Furthermore, the officer or
employee of the United States government or the District of Columbia
government who knowingly and willfully violates this prohibition is
subject to a $5,000 fine or imprisonment for not more than 2 years, or
both (31 U.S.C. 1350).
Violations of limitations by an officer or employee of an executive
agency or the District of Columbia government shall be reported
immediately after it becomes known by the head of the executive agency
or the Mayor of the District of Columbia to the President and
Congress. The reports shall contain all relevant facts and a statement
of actions taken (31 U.S.C. 1351 and 1517(b)). Additional guidance to
executive agencies concerning the types of violations, reporting
requirements, and timing of reports, is in OMB Circular A-34.
B. Concealment of an Obligation Violation:
Government officials and employees are expected to act with
professional honesty and integrity. It is improper to conceal or
attempt to conceal a potential violation of laws such as 31 U.S.C.
1341. The following citations are provided to indicate the seriousness
of such action.
1. Concealment of the commission of a felony is itself a felony,
punishable by a fine of not more than $500 or imprisonment of not more
than 3 years, or both (18 U.S.C. 4).
2. It is also an offense to aid another in committing an offense (18
U.S.C. 2); to assist an offender in order to hinder apprehension,
trial, or punishment (18 U.S.C. 3); or to conspire to commit an
offense (18 U.S.C. 371).
3. Anyone who, in any matter within the jurisdiction of a U.S.
department or agency, (I) knowingly and willfully falsifies, conceals,
or covers up a material fact; (2) makes any fraudulent statements or
representations; or (3) makes or uses any false writing or document
knowing the same to contain any false, fictitious, or fraudulent
statement or entry shall be fined not more than $10,000 or imprisoned
not more than 5 years, or both (18 U.S.C. 1001).
3.7 Reconciliation And Review Of Obligations:
Periodically, and at the close of each fiscal year, each agency must
reconcile its obligation controlling accounts to its supporting
records. The reconciliation process includes verifying that the
agencies' monthly, quarterly, and annual obligation reports to
Treasury and OMB agree with the agencies' obligation control accounts
for each open appropriation account. Obligation reporting requirements
include the quarterly SF 225, Report on Obligations (Treasury
Financial Manual, volume I, part 2, chapter 4400) and monthly and
annual SF 133 reports to OMB on budget execution (Circulars A-11 and A-
34). These reports are also to be in agreement with unpaid obligations
as reconciled on other Treasury year-end reports for each open
account. Other Treasury year-end reports include SF 2108, Year-End
Closing Statement, SF 6653, Undisbursed Appropriation Account Ledger,
and TFS 6654, Undisbursed Appropriation Account Trial Balance.
3.8 Reporting Of Obligations:
A. Obligation Reports and Certifications:
In addition to reconciling obligations and reports noted in section
3.7 of this title, the head of an agency is required to include in the
agency's appropriation(s) request submitted to the President (through
OMB) a certified statement that the obligations presented in the
request are consistent with the obligation recording criteria of 31
U.S.C. 1501. (See subsection 3.5.B.) The head of the agency is
required to support the certification with records showing the
obligated amounts. The certifications and records are to be kept in
the agency (1) in a form that makes audits and reconciliations easy
and (2) for a period necessary to carry out audits and reconciliations
(31 U.S.C. 1108(c)).
To facilitate these requirements, the head of the agency shall
designate officials to make the certifications, but those officials
may not further delegate the responsibility (31 U.S.C. 1108(c)). The
purpose of this provision is to ensure that the officials designated
by the heads of the agencies to make certifications of obligations are
those officials having overall responsibility for obligations, as
distinguished from those engaged in detailed recording operations. In
no event, however, are the persons designated by the heads of the
agencies to be below the level of the chief accounting officer of a
major bureau, service, or constituent organizational unit. The
required certification statement is:
"I hereby certify that the amounts shown in this report are correct.
All known transactions meeting the criteria of 31 U.S.C. 1501(a) have
been obligated and are so reported."
In addition to this requirement, the head of each agency must
establish internal controls to assure that an adequate review of
obligated balances is performed to support this certification (31
U.S.0 1554(d)).
If for any reason the foregoing certification cannot be made, the
official designated to certify shall explain the reason for not being
able to do so.
A person or public officer who is authorized by law to make or give a
certificate and does so knowing the certificate contains a false
statement is subject to a fine of not more than $500 or imprisonment
for not more than 1 year, or both (18 U.S.C. 1018).
Note that the person who certifies obligations reports is not a
"certifying officer" for purposes of personal accountability for the
subject funds. Although the person may be coincidentally an
"authorized certifying officer," the two functions are legally
distinct.
Transfer appropriation accounts under the control of the spending
agency shall be certified to the head of the advancing agency for
inclusion in the advancing agency's reporting requirements.
In addition, an annual report must be submitted to the President, the
Secretary of the Treasury, and the Congress. (See section 4.6 of this
title for the reporting requirements.)
All certifications, basic records, and reports of obligations shall be
available for audit purposes no later than 90 days after the close of
the accounting period. For record retention requirements, see Title 8
of this manual.
B. Additional Guidance on Certifying Obligations:
When determining the amounts to be certified under 31 U.S.C. 1108(c)
and 1554(b)(2)(E), agencies should consider the following.
1. While it is incumbent on agencies to provide the best information
they can in statements of obligations provided to the President, the
law neither specifies how officials making the certifications are to
satisfy themselves that the amount certified meets the requirements of
31 U.S.C. 1108(c) and 1554(b)(2)(E) nor requires agencies to verify
100 percent of the unliquidated obligations individually before
certifying to the validity of the obligation balances.
2. Each agency shall review its unliquidated obligations at least once
a year, not necessarily at the fiscal year-end, to reasonably assure
itself that all and only those transactions meeting the criteria of
legally valid obligations described in sections 3.3 and 3.5 of this
chapter have been included. The review is necessary to support the
certifications required by 31 U.S.C. 1108(c) and 1554(b)(2)(E).
Periodic and systematic reviews throughout the year of the manual and
automated processes for supporting and recording obligations would
allow agencies to rely on the system operation when making
certifications at the end of the year.
3. Agencies may use statistical sampling for the purpose of giving
qualified certifications of obligation balances in order to satisfy
the requirements of 31 U.S.C. 1108(c) and 1554(b)(2)(E). There is
nothing to preclude agencies from making qualified certifications and
indicating that the amount of obligations certified might contain
inaccuracies or variations up to some amount. This would be preferable
to failing to make certifications altogether if the agency could not
do 100-percent verification reviews of the amount certified. Such
certifications should indicate that they were based on valid
statistical sampling and the amounts certified are subject to some
stated amount of error.
[End of Chapter 3]
Chapter 4: Year-End Closing Of Accounts:
4.1 Basis For Closing Account Balances:
General requirements for adjusting and closing current and expired
account balances for appropriations are in 31 U.S.C. 15511558.
Specific instructions to executive agencies for adjusting and closing
accounts are set forth in part XI, OMB Circular A-34 and the Treasury
Financial Manual, volume I, part 2, chapter 4200. Public Law 101-510,
enacted November 5, 1990, changed the procedures for closing
appropriation accounts by amending sections 1551-1557 of title 31,
U.S. Code.
Unless otherwise authorized by law, these requirements apply to all
appropriations, except appropriations for the District of Columbia
government and appropriations disbursed by the Secretary of the Senate
or the Clerk of the House of Representatives. In addition, an
appropriation law may exempt the appropriation from these provisions
and establish the time period during which funds remain available for
expenditure.
This chapter presents an overview of the changed process for closing
accounts. Appendix VI describes the procedures to be used for certain
accounts established under the prior procedures that will be phased
out during a 3-year transition period.
4.2 Availability Of Appropriations For Obligation:
A. Fixed Period Appropriations:
Fixed period appropriations are available for incurring obligations
for a definite period of time (annual or multiple year), after which
they expire. Appropriations close at the end of the fifth year after
they expire. The fiscal year identity will be retained for all expired
and closed appropriations. (See figure 4.1 on page 7.4-5.)
During the expired period, appropriations are not available for
recording new obligations incurred. However, expired appropriations
can be used to adjust and liquidate obligations that were incurred
prior to the expiration of the appropriation but not recorded or
reported, or that were recorded and reported in amounts less than
ultimately determined to be payable. Obligation adjustments may not
exceed the unobligated balance of the expired appropriation. For
obligations and expenditures applicable to closed appropriations, see
sections 4.4 and 4.5.
Certain obligation increases for contract changes applicable to
expired fixed period appropriations require special handling before
they are incurred. For additional guidance, see subsection 3.3.B of
this title.
B. No-year Appropriations:
No-year appropriations are available for recording new obligations for
an indefinite time period and remain available until the
appropriations are closed. An appropriation will be closed if:
* the head of the agency concerned or the President determines that
the purpose for which the appropriation was made has been carried out
and;
* no disbursement has been made against the appropriation for 2
consecutive fiscal years.
C. Appropriations Affected by Contract Protests:
Funds available for recording an obligation for a contract at the time
a protest is filed in connection with a solicitation for, proposed
award of, or award of a contract shall remain available for obligation
even if the appropriation expires. Obligation authority equal to the
amount needed for obligating the contract will remain available for 90
working days after the date on which the final ruling is made on the
protest. A ruling is considered final on the date on which the time
allowed for filing an appeal or request for reconsideration has
expired, or the date on which a decision is rendered on such an appeal
or request, whichever is later (31 U.S.C. 1558).
This procedure applies to any protest filed under subchapter V of
chapter 35, title 31 U.S. Code or under section 111(f) of the Federal
Property and Administrative Services Act of 1949 (40 U.S.C. 759(f)).
4.3 Crediting Of Collections To Appropriations:
Agency collections that are authorized to be applied to appropriations
shall be credited to the applicable appropriations (including expired
fixed period appropriations) if received before the appropriation is
closed. All collections applicable to closed appropriations, either
fixed or no-year, shall be deposited into miscellaneous receipts of
the Treasury (receipt account 3200, Collection of Receivables from
Canceled Accounts) and not to the credit of the respective
appropriations. (For further discussion, see collections credited to
appropriation and fund accounts, section 5.4 of this title.)
4.4 Closed Appropriations:
Closed appropriations are not available for obligation or expenditure
for any purpose. Any remaining obligated or unobligated balances in
the appropriation at the time it is closed shall be canceled. Payments
that arise for obligations or accounts payable pertaining to closed
appropriations may be charged to an unexpired appropriation for the
same general purpose as the closed appropriation, provided that:
* the total dollar amount of all payments from an unexpired
appropriation for obligations and accounts payable attributable to
closed accounts does not exceed 1 percent of the appropriation from
which the payments are made and,
* the obligations or adjustments to obligations for which payment is
made would have been properly chargeable to the closed account, both
as to purpose and amount.
Absent the use or availability of an unexpired appropriation, agencies
must seek a reappropriation or other specific legislative authority
through the budget process to pay canceled obligations or accounts
payable of closed appropriations.
4.5 Controls And Records Requirements For Expired And Closed
Appropriations:
Any audit requirement, limitation on obligations, or reporting
requirement that is applicable to an appropriation account shall
remain applicable to that account after the end of the period of
availability for obligation of that account. For example, the
requirements of the Antideficiency Act are applicable to expired and
closed appropriations.
Records shall be maintained after the period of availability expires
to ensure compliance with these requirements. To comply with the
requirements set forth in section 4.4 of this title, records shall be
maintained and monitored for each closed account to ensure that the
total budget authority in the account before it was closed is not
exceeded when properly charging an unexpired appropriation for
obligations and expenditures applicable to the closed account. Record
retention requirements should be in conformance with Title 8 of this
manual.
4.6 Reporting:
The agency head shall report the unliquidated obligation balances,
unobligated balances, canceled balances, and appropriation adjustments
after the close of each fiscal year. The annual report is due to the
President, the Secretary of the Treasury, and the
Congress no later than 15 days after the President submits the next
scheduled budget (for the fiscal year after the current fiscal year)
to the Congress (31 U.S.C. 1554). For example, the annual report for
fiscal year 1992 would be due 15 days after the fiscal year 1994
budget is submitted to the Congress in fiscal year 1993. Agencies
should follow the Treasury reporting instructions.
Figure 4.1: Illustration Of Appropriation Account Closing For Fixed
Period Appropriations:
Current Period: (1 year or multiple years):
Inception of appropriation account;
End of period appropriation account available for new obligations.
Expired Period: (5 years):
Balances maintained on records of agencies for each appropriation
account:
1. total budget authority,
2. unobligated balance, and,
3. obligated balance (unliquidated obligations).
End of period appropriation account available for obligation
adjustments or disbursements.
Closed Period: (Indefinitely):
Agencies are to maintain records[A] to account for the undisbursed
balance for each appropriation account at the time of closing. This is
represented by the:
1. canceled unobligated amount,
2. canceled amount of unliquidated obligations (undelivered orders),
and,
3. amount of accounts payable when the account was closed.
[A] These records relating to closed appropriation accounts provide
the basis for an agency to determine whether the amount chargeable to
a current appropriation would have been "properly chargeable" to the
closed appropriation account. (See section 4.4.)
[End of figure]
[End of Chapter 4]
Chapter 5: Collections:
5.1 Applicability:
These requirements are based on statutes and are applicable, with
certain exceptions, to all classes of funds collected by officers and
employees of the U.S. government, including:
* receipts from any source, for the use of the United States, which
are required to be deposited into the Treasury's general fund as
miscellaneous receipts,
* reimbursements and refunds for credit to appropriation accounts,
-- payments that are credited to management, revolving, and deposit
fund accounts,
* receipts that are credited to special and trust fund accounts,
* receipts from unofficial use of government facilities in emergencies,
* collections credited to nonbudgetary credit financing accounts,
* proceeds from sales of government personal property, and,
* collections of certain payments from government employees.
Exceptions to the requirements of this chapter are collections
otherwise subject to statutory and regulatory control specifically
governing the collecting, handling, and depositing of funds. Such
exceptions include customs and internal revenue receipts, District of
Columbia tax receipts, postal receipts, and receipts from the sale of
real property. For additional discussion and guidance on the
availability or unavailability of receipts for agency use, see GAO's
Principles of Federal Appropriations Law.
Details on cash management and the deposit of collections can be found
in regulations and instructions issued by Treasury (Treasury Financial
Manual, volume I, parts 5 and 6).
Guidance on the tools and procedures for collecting delinquent
receivables is provided in Title 4 of this manual, the Federal Claims
Collection Standards (4 C.F.R. 101-105), OMB Circular A-129, and the
Treasury Financial Manual supplement, "Managing Government Credit."
5.2 Control Over Collections:
A. Responsibilities for Collection Controls and Records:
All officers and employees of the U.S. government who, by virtue of
their official capacity, receive moneys on account of or for the
custody of the United States--including donated, quasi-public, and
unearned moneys--shall maintain proper records and provide
adequate physical control over such funds. Persons designated as
accountable officers shall account for all receipts and deposits. (The
topic of accountable officers is discussed in more detail in chapters
7 and 8.)
Agencies are responsible for placing collections under appropriate
accounting control promptly upon receipt. Records will be maintained
in sufficient detail to readily identify all collections including bid
deposits and collections for other agencies. Control records shall
disclose:
1. collections that have not been deposited,
2. deposits in transit, and,
3. deposits that have been confirmed by the depositary.
Also, agencies must ensure that contractors collecting funds on behalf
of the government maintain proper records and provide adequate
physical control over such funds.
B. Separation of Duties for Cash Receipts:
In accordance with the internal control standard for separation of
duties, persons responsible for handling cash receipts should not
participate in the accounting or operating functions relating to any
of the following:
1. shipping of goods and billing for goods and services,
2. controlling accounts receivable and subsidiary ledgers,
3. preparing and mailing statements of balances due,
4. authorizing and approving credits for returns and allowances or for
adjustments of amounts due, or
5. preparing cash reconciliations.
Separation of duties helps reduce the opportunity to misuse cash
receipts and use the accounting records to conceal such misuse.
Special accounting controls are necessary when sales or operating
persons handle cash receipts.
Officials who are responsible for cash collections shall not commingle
such receipts with personal funds or use official receipts for cashing
checks or money orders. However, disbursing officers are authorized to
cash checks in situations specified by 31 U.S.C. 3342. (Also see
Treasury Financial Manual, volume I, part 4, Chapter 9000.)
C. Inscription and Endorsement of Remittances:
Agencies shall, where possible, instruct remitters to make checks and
other negotiable instruments payable to the order of the specific
organizations or operating units maintaining the accounts to be
credited, rather than to the Treasurer of the United States. Any
remittance payable to the Treasurer of the United States, however,
should be accepted and processed by the receiving agency.
In no event shall agencies instruct remitters to make checks, money
orders, or other instruments payable to individual officers or
employees by name. Endorsements should comply with Treasury
regulations (Treasury Financial Manual, volume I, part 5, chapter
2000).
5.3 Deposit And Documentation Of Collections:
A. Legal Requirements for Deposit of Receipts:
The general rule with respect to collections from sources outside the
government is that all moneys received for the use of the United
States shall be turned into the Treasury as general fund miscellaneous
receipts (31 U.S.C. 3302(b)). The term "miscellaneous receipts" does
not refer to any single account in the Treasury; rather, it refers to
a number of receipt accounts under the heading "General Fund," as
listed in Treasury's Federal Account Symbols and Titles (FAST).
In addition to 31 U.S.C. 3302(b), several other statutes require that
certain specific collections be deposited into miscellaneous receipts.
Examples include user charges and fees collected under 31 U.S.C. 9701
and receipts collected after appropriations are closed under
provisions of 31 U.S.C. 1552(a) or 1555.
Accordingly, an agency retaining for its own use, or crediting to its
own appropriation, receipts that are required to be deposited into the
Treasury general fund is an improper augmentation of an agency's
appropriation.
B. Deposit Requirements:
The frequency of deposits will depend on the amount of funds received
by a depositing office. Receipts of $1,000 or more shall be deposited
daily. Daily receipts of less than $1,000 may be accumulated and
deposited when the total reaches $1,000, except that Treasury's cash
management regulations require that deposits be made by Friday of each
week regardless of the amount accumulated (Treasury Financial Manual,
volume I, part 6, chapter 8000). If checks or money orders are held
uncashed (for example, bid deposits), they are to be under appropriate
physical safeguards and accounting control.
Collections shall be deposited according to the procedures prescribed
by Treasury (Treasury Financial Manual, volume I, part 5, chapter
2000). If the proper account to be credited cannot be "identified when
collections are received, the credit shall be to the agencies' deposit
fund suspense accounts until the disposition of the collections can be
identified. (See subsection 5.5.H.)
For checks or other negotiable instruments which cannot be deposited
because they were lost, destroyed, or mutilated during government
processing, agencies should seek replacement in accordance with
Treasury regulations (Treasury Financial Manual, volume I, part 5,
chapter 5000). If such an item cannot be replaced, the loss is an
irregularity which should be processed in accordance with the guidance
in chapter 8 of this title.
C. Support for Collections Deposited:
Collections reported to Treasury in agencies' monthly reports shall be
supported by confirmed copies of the deposit tickets covering the
collections or by appropriate schedules of collections referring to
the related deposit tickets.
5.4 Collections Credited To Appropriation And Fund Accounts:
A. Collection Classifications
Collections permitted to be credited to appropriation and fund
accounts fall within two general classifications.
1. Refunds.
Refunds are returns of advances, collections for overpayments made,
adjustments for previous amounts disbursed, or recovery of erroneous
disbursements from appropriation or fund accounts that are directly
related to, and are reductions Of, previously recorded payments from
the accounts.
2. Reimbursements.
Reimbursements (which in some cases are classified as fees, proceeds,
etc.) are sums received by the government in payment for commodities
sold or services furnished, either to the public or to another
government account.
B. Crediting Collections to Appropriation and Fund Accounts:
There are separate procedures for depositing refunds and
reimbursements to the credit of appropriations and fund accounts.
1. Refunds.
Refunds are not required to be deposited to the credit of
miscellaneous receipts by 31 U.S.C. 3302(b). They are to be deposited
to the credit of the appropriation or fund charged with the original
expenditure unless other deposit procedures are expressly prescribed
by statute.
2. Reimbursements.
Reimbursements may be deposited to the Credit of an appropriation or
fund account only when authorized by law. Such reimbursements should
be deposited to the credit of the appropriation in accordance with the
requirements imposed by the authorizing legislation. For example, the
law may authorize the credit of deposits to current appropriations or
it may direct that the credit be to the appropriation initially
charged with the cost of reimbursable work.
The collection of refunds or reimbursements authorized to be deposited
to the credit of the appropriation initially charged with the
expenditure is to be deposited to the expired account if collected
after the expiration of the appropriation. However, collections of
refunds and reimbursements that would have been authorized to be
deposited to the credit of appropriation or fund accounts prior to
closing cannot be credited to accounts that have been closed in
accordance with 31 U.S.C. 1552(a) or 1555. Collections for these
closed accounts must be deposited as miscellaneous receipts in the
Treasury (31 U.S.C. 1552(b)).
C. Availability of Special Fund Receipts:
Special fund receipts are accounted for depending on whether they are
categorized as available or unavailable.
1. Available receipts.
Available receipts are those which under law are immediately available
in their entirety as appropriations to a single agency for expenditure
without further action by the Congress. However, receipts to be
applied to the retirement of Public Debt obligations are excluded from
this category.
2. Unavailable receipts.
These are receipts that at the time of collection are not
appropriated, and receipts that are not immediately available to spend
because (a) further action by the Congress is required, (b)
congressional limitation has been established as to the amount
available for expenditure, or (c) amounts credited to receipt accounts
are later to be cleared in whole or in part to other receipt accounts
before appropriation warrant actions are taken.
3. Accounting.
Both available and unavailable receipts for credit to special funds
will be accounted for by agencies under receipt account symbols
assigned by Treasury. In addition, those designated by Treasury as
available will be concurrently accounted for in the related special
appropriation fund accounts.
For additional discussion and guidance on the availability or
unavailability of receipts for agency use, see GAO's Principles of
Federal Appropriations Law.
D. Documentation:
Collections credited to appropriation and special fund accounts must
be proper and authorized by law or appropriate regulations. Agencies
must be able to produce references to such authorizations if they are
called for in connection with an audit of the accounts. Agency
collection records pertaining to refunds and reimbursements will
include descriptions of transactions sufficient for identifying the
source of, or reason for, the collection.
In addition, to ensure that special fund receipts are properly
recorded in receipt accounts and not recorded as repayments to
appropriations, agencies preparing original posting documents must
clearly identify the receipt account number so that proper
classification can be made in monthly reports to Treasury.
5.5 Other Collections:
A. Collections by Voucher Deductions:
Various types of collections are made by voucher deductions under
procedures prescribed by Treasury. These collections include Federal
Insurance Contributions Act taxes, federal and state income taxes,
travel advances, claim settlements, and contractor refunds of advances.
B. Collections by One Agency for Another:
Collections of any type received by one agency should not be forwarded
to another for deposit. Such collections should be deposited by the
collecting office for credit to its suspense or budget clearing
account as described in the Treasury Financial Manual, volume I, part
5, chapter 3000. The transfer of funds to the designated agency should
be accomplished by following the procedures for interagency
transactions in the Treasury Financial Manual, volume I, part 6,
chapter 10000.
C. Collections for Unofficial Use of Government Facilities in
Emergencies:
The government's policy is to prohibit the unofficial use of
government facilities by government officers, government employees,
and private citizens, except in emergencies or when authorized by law.
The term "facilities" as used herein applies to various services
acquired or used for official purposes by the government. It includes
telecommunications; office or storage space; office or business
equipment and furniture; any other leased property, equipment, or
service used by the government; and transportation obtained with
government transportation requests or bills of lading. Generally, the
government has contracted for such services with an owner, vendor, or
transportation company.
It is the responsibility of the user to report immediately any
emergency use of facilities to the appropriate administrative official
and to reimburse the government for the cost of such use and any
excise or other federal tax imposed. Funds received for the emergency
use of government facilities, with the exception of federal taxes,
will be deposited in the appropriate account and that portion of the
contractor's bill will be paid therefrom. Federal taxes collected will
be remitted to the Internal Revenue Service.
Special requirements for control over use of telephones are described
in appendix IV of this title.
D. Exchange or Sale of Personal Property:
In acquiring personal property, an executive agency may exchange or
sell similar items and apply the exchange allowance or proceeds of
sale in whole or partial payment for similar item replacement property
(40 U.S.C. 481(c)). All such transactions are to be properly
documented.
Except as otherwise directed by law, all proceeds from the sale of
personal property will be available during the fiscal year in which
the property was sold and for 1 fiscal year thereafter for obligation
for the purchase of replacement property.
If the sales proceeds are received after an obligation for replacement
property has been incurred and within the prescribed time limit, the
proceeds may be credited as a direct reimbursement to the
appropriation account charged or chargeable for the replacement
property.
If the sales proceeds are received before an obligation for
replacement property has been incurred, but an administrative
determination has been made and documented that such proceeds will be
used as an appropriation reimbursement to apply against an obligation
which will be incurred within the prescribed time limit, the proceeds
should be credited to the appropriate budget clearing account.
Agencies are reminded that a suspense budget clearing account should
not be used for this purpose since it must be cleared by the end of
the current fiscal year.
The appropriate budget clearing account will be charged and the
appropriation account will be credited when the obligation is
subsequently incurred for the replacement property. The voucher must
include or be supported by evidence that the credit to the
appropriation account is applicable to an obligation incurred for the
purchase of replacement property.
At least quarterly, agencies should review the accounts used for
deposit of sales proceeds and clear them of any amounts that should be
applied to other accounts or transferred to miscellaneous receipts in
the general fund of the Treasury.
If the sales proceeds are not available for obligation or are not to
be applied to replacement purchases, the proceeds will be deposited in
the Treasury as miscellaneous receipts in the general fund.
The transaction descriptions for these replacement purchases are
presented in the Standard General Ledger, transactions T5055 through
T5075. Regulations governing the exchange or sale procedures of items
covered by this section are contained in Federal Property Management
Regulations, part 101-46, (41 C.F.R. 101-46) and are the
responsibility of the General Services Administration.
E. Recoveries of Damages:
Recoveries of damages are deposited depending on their nature.
1. Contract damages.
The amount of excess costs or liquidated damages recovered
because of default or breach of contract may be used to fund a
replacement contract and need not be deposited to
miscellaneous receipts (62 Comp. Gen. 678 (1983) and 64 Comp. Gen. 625
(1985)).
2. Property damages.
Generally, funds recovered from third parties for damage to government
property must be deposited to miscellaneous receipts and may not be
credited to an appropriation available to repair such property or any
other appropriation of the agency (67 Comp. Gen. 129 (1987)). However,
payments-in-kind for damage to government property may be accepted
without an offsetting adjustment between the appropriation and
miscellaneous receipts (67 Comp. Gen. 510 (1988)).
3. Subrogee's recoveries.
In those cases when the government pays for a loss of, or damage to,
an employee's personal property under 31 U.S.C. 3721 but the ultimate
liability for the payment rests with a third party, amounts collected
by the government from the third party may be deposited to the
appropriation charged with the payment to the employee (61 Comp. Gen.
537 (1982)).
F. Collections of Certain Payments From Government Employees:
As a general rule, federal employees are obligated to account for any
significant gift, gratuity, or benefit received from private sources
incident to the performance of official duty. (See 5 C.F.R. 2635 for
specific situations and exceptions.) Normally, items or moneys so
received are the property of the government and may not be retained
for personal use by the employee. For example, this rule applies to
fees and payments received by employees that represent juror and
witness fees, riot pay while serving with the National Guard, and
airline travel discounts or penalty payments by airlines for not
providing confirmed seats.
Juror and witness fees paid to government employees (other than those
employees paid by the Secretary of the Senate or the Clerk of the
House of Representatives) by state or municipal courts for serving on
juries or as government witnesses while on court leave from their
agencies are to be remitted to their agencies for deposit. However,
jury fees may be retained by government employees when the jury
service is in a state or municipal court on a nonworkday (e.g.,
weekend or holiday) or when the employee is in a nonpay status.
Government employees who serve as jurors in a state or municipal court
are not required to remit to their agency that part of compensation
received from the court to cover expenses when it is clear that a
specific amount is received for that purpose.
Government employees serving as jurors for federal courts do not
receive juror fees unless they are in a nonpay status during all or
part of the period of jury service, but they do receive
transportation, parking, and lodging expenses. These expenses do not
have to be remitted to the employee's agency.
Juror and witness fees remitted to agencies by their employees will be
deposited in the Treasury to the credit of the appropriation or fund
from which the employees are paid.
Riot pay paid by the National Guard to government employees when such
employees are on military leave will be remitted to their agencies for
deposit to the credit of the appropriation or fund from which such
employees receive their compensation.
Promotional materials, such as bonus flights, reduced-fare coupons,
cash, merchandise, gifts, credits toward future free or reduced costs
of services or goods, given to employees on official travel belong to
the government. (See 63 Comp. Gen. 229 (1984).) This applies even if
part of the travel occurred during nonduty hours or at personal cost
to the employee. Some promotional items that have no apparent value to
the government, such as free upgrades to first-class travel,
memberships in executive clubs, and check-cashing privileges, need not
be turned over to the agency but may be used by the employee provided
they are used only during the course of official travel. Promotional
materials given to official travelers that are of nominal value such
as pens, pencils, note pads, calendars, or similar items may be
retained by the employee.
Items and money received by employees from private sources such as
airlines, automobile rental firms, and lodging providers must be
remitted to their agencies, except for nominal promotional materials.
Any money received by agencies representing discounts or rebates will
be deposited to the credit of the appropriation initially charged with
the payment since these constitute refunds. Payments received as
penalties shall be deposited to the Treasury as miscellaneous receipts.
G. Collections of Debts Owed the Government:
Any debt owed the government that is due should be collected in full
in one lump sum including any interest, penalties, and administrative
costs. If it is not feasible to collect the total debt in one lump
sum, payment may be accepted in regular installments. However,
agencies are to take appropriate steps to determine that it is a
hinderance for the debtor to render a lump sum payment. Additional
guidance is in the Treasury Financial Manual, volume I, part 6,
chapter 8000.
Collections received in partial or installment payments shall be
applied first to outstanding penalty and administrative costs, second
to accrued interest, and third to outstanding principal, as required
by the Federal Claims Collection Standards (4 C.F.R. 102). Additional
details are discussed in GAO's Principles of Federal Appropriations
Law. However, the sequence applied to collections of unpaid fines is
to principal, costs, interest, and penalties (18 U.S.C. 3612(i)).
H. Unidentified Remittances:
Unidentified remittances considered ultimately creditable to a
receipt, appropriation, or fund account within the budget will be
credited to a receipt clearing account (or to the Treasury trust fund
receipt account "Unclaimed Moneys...," 31 U.S.C. 1322); otherwise, the
remittances will be credited to a deposit fund suspense account
outside the budget. If remittances are subsequently identified to
accounts within the budget, they must be transferred. Transfer
documents should show the purpose for which the remittances were
received.
When corrections or adjustments to be made within an accounting
station are expenditure transactions between appropriation, fund, or
receipt accounts, reclassification will be accomplished by journal
voucher. If the adjustment involves separate stations, the On-Line
Payment and Collection (OPAC) System or SF 1081 (transfer between
stations) should be used.
In cases where an amount or portion of an amount was due and has been
received and correctly processed but misclassified (credited to the
wrong account), the clearance can be accomplished by an expenditure
transfer to the correct receipt account. In those cases where a refund
of all or a portion of the amount to which an agency was not entitled
(due to duplicate billing, etc.) is to be made and the receipt was
credited to an agency's appropriation, the refund must come from that
same appropriation. If, however, the receipt has been deposited as a
miscellaneous receipt (which cannot be recovered without an
appropriation), the refund must be charged to account symbol 20X 1807,
"Refund of Moneys Erroneously Received and Covered," in accordance
with 31 U.S.C. 1322(b)(2). Records must be maintained in support of
charges to this account. For further detail on procedures for
transferring unclaimed moneys, see the Treasury Financial Manual,
volume I, part 6, chapter 3000.
[End of Chapter 5]
Chapter 6: Disbursements:
6.1 Disbursing Operations:
A. General:
The funds of most executive agencies are disbursed by Treasury,
through Treasury's disbursing officers, under the direction of the
Chief Disbursing Officer, Financial Management Service. Disbursing
officers for agencies subject to 31 U.S.C. 3321(b) derive their
authority by direct delegation from the Chief Disbursing Officer or by
delegation from Treasury disbursing officers providing centralized
disbursing services to the agencies.
Not all funds are disbursed by Treasury. Some principal exceptions are
disbursements made by the Department of Defense, the United States
Marshals Service, and certain government corporations. The disbursing
functions for the excepted organizations and for most organizations in
the legislative and judicial branches of the government are performed
by the organizations' own disbursing offices. In most cases, a
disbursing officer of an excepted organization receives authority to
disburse by delegation from the head of the organization or from other
agency officials having legal authority to make such delegations.
Also, for all civilian agencies overseas, the Department of State
performs the disbursing function for Treasury.
B. Disbursement Functions:
All disbursements, except those authorized to be made in cash, shall
be made by checks, electronic fund transfers, or any other means
identified by the Secretary of the Treasury and drawn by authorized
officers on the Treasury of the United States, or on designated
depositaries (i.e., commercial banks or banking institutions
designated by Treasury to hold U.S. government funds), or any other
means identified by the Secretary of the Treasury. (See 31 U.S.C.
3335.) Regulations governing disbursements by Treasury are published
in the Treasury Financial Manual, volume I, part 4.
Agency controls should ensure that amounts paid by the disbursing
officers were in accordance with the payment information certified to
them on vouchers or voucher schedules. (See subsection 7.I.B.) Such
controls should also include procedures for ensuring the proper
custody, signing, and delivery of checks.
Designated depositaries should be instructed to send all agency bank
statements (and paid checks, if appropriate) for checking accounts
maintained by U.S. government disbursing offices directly to the
agency concerned. Each agency is responsible for reconciling bank
statements with its accounts. For control purposes, however, such
reconciliations shall be reviewed by someone independent of the
responsible disbursing officer.
6.2 Disbursement Forms And Documentation:
A. Forms:
Except as otherwise specifically provided, all disbursements from the
accounts of the Treasury of the United States or designated
depositaries of federal funds shall be processed on forms, vouchers,
or voucher schedules prescribed by Treasury. Limited exceptions to
this general requirement permit the Departments of State and Defense
to prescribe disbursement forms falling clearly within their
functional areas and the General Services Administration to prescribe
forms dealing with transportation and reimbursement of travel
expenses. Procedures for the use of a particular form shall be
prescribed by the agency responsible for it. Appendix I lists a number
of standard and optional forms along with the prescribing agencies.
Treasury prescribed forms and procedures are primarily contained in
the Treasury Financial Manual, volume I, part 4.
In addition, agencies should have a standardized contract numbering
system to facilitate identification with related expenditure or
collection transactions. The contract number should consist of alpha
characters in the first positions to indicate the agency, followed by
alpha-numeric characters identifying bureaus, offices, or other
administrative subdivisions authorized to enter into contracts. The
last portion of the contract number should be sequential with a unique
number series for each contracting activity.
Disbursements shall be recorded promptly in the proper accounts of the
agencies and reported in accordance with Treasury regulations.
B. Documentation Requirements--General:
The disbursements shall be supported by basic payment documents,
either hard copy or machine readable source records, which include
purchase orders, contracts, receiving reports, invoices, bills,
statements of accounts, etc., showing sufficient information to
adequately account for the disbursements. The documentation should
link all supporting records and enable audit of the transactions and
settlement with the certifying or disbursing officers as required by
law. If disbursements are made in cash, the vouchers should be
receipted by the vendors or receipts from the vendors should be
attached to the vouchers. (See section 6.8.)
The preparation of the disbursement voucher includes the essential
steps of assuring, apart from any subsequent audit, that (1) goods or
services were ordered by an authorized official, evidenced by a
purchase order, contract, or other authorization, (2) goods or
services ordered have been delivered and accepted, evidenced by
receiving and inspection reports, and (3) an invoice or bill has been
received. An exception to these requirements may be subject to GAO
approval. (See subsections 7.4.A through G of this title.) The
documentation requirements for employee pay, leave, and allowances are
covered in Title 6 of this manual.
Basic payment documents supporting disbursements do not necessarily
need to be forwarded to a central processing point. Instead, agencies
may maintain supporting documentation in several locations combined
with a reliable system to extract and forward information needed for
comparing and matching the necessary payment data from authorizing,
receiving, and billing documents. For example, the system may use
magnetic or electronic media to transmit needed information to the
certifying or disbursing officer provided an audit trail is maintained
and there is adequate control to ensure reliability. (See section 7.4.)
Also, microform copies of paper records can be acceptable for audit
and legal purposes. (See section 3.4, Title 8 of this manual, and 36
C.F.R. 1230.)
C. Documentation Requirements--Alternative Conditions:
There are situations in which alternatives may be used for the usual
documentation requirements. These alternatives must have adequate
procedures and controls to protect the government's interest. Specific
GAO approval will not be required for using the following types of
alternatives.
1. Use of invoices in place of vouchers.
Disbursement transactions, except those involving charges for
transportation services, are not required to be processed on
prescribed vouchers if the invoices or bills show all the required
information. Such invoices or bills may be used as vouchers in support
of the agencies' accounts and accountability statements.
2. Recurrent payments--fixed amounts.
Recurrent payments for services under agreements providing for payment
of fixed amounts at regular intervals may be made without requiring
the vendor to submit periodic invoices or bills. Each voucher prepared
by the agencies to support payments of this nature should, at the
minimum, include appropriate administrative approvals and show or
provide references to:
a. the agreement or contract number,
b. the period covered by the payment,
c. the name of the payee,
d. the amount of the payment, and,
e. the fund and general ledger accounts to be charged.
3. Periodic bills from vendors.
Agencies may find it desirable to arrange with vendors to submit
periodic bills for purchases made under blanket purchase agreements.
Such a bill shall be verified in the same manner as any other invoice.
4. Consolidation of payments for multiple invoices.
To minimize the number of vouchers prepared and payments made by
disbursing officers, multiple invoices may be consolidated into a
single payment, provided that:
a. payment is to a single office or place of business of the vendor,
b. payment is for a single government establishment,
c. the consolidated payment is agreeable to the vendor, and,
d. payment is made in accordance with prompt payment requirements.
(See section 6.3.)
5. Payments to public utilities.
Payments may be made to public utilities in the absence of a contract
when the charges are based on rates that are fixed or adjusted by
federal, state, or other regulatory bodies. However, contracts are not
precluded where either the companies or the agencies require
agreements or contracts for the furnishing of services.
D. Documentation of Certificated or Unvouchered Payments:
Certain laws authorize certificated or "unvouchered" payments which
are specified amounts for specified purposes for a given fiscal year.
They are accounted for solely on the certificate or approval of a
designated government official, for example, the President, Vice
President, or the head of a department or agency. Certificates do not
reveal all the information normally contained in basic vouchers and
their supporting documentation. Further, some laws authorizing
certificated or "unvouchered" payments limit GAO's audit to a review
of the certificate without access to the supporting documentation.
However, basic information must be on the certificate to ensure that
any limit on the amounts that may be spent for such purpose is not
exceeded and the appropriation or fund from which such payments are
made is not exceeded. Therefore, the statement on the certificate must
include:
1. the appropriation to be charged,
2. the amount of the expenditure,
3. the citation of legal authority for certification,
4. a general statement that expenditures covered by the certificate
are of a nature for which certification under the cited legal
authority is appropriate, and,
5. the signature of the official having authority to certify the
expenditure.
Normally, certificates should be executed prior to payment; if this is
not feasible, as soon thereafter as possible.
Any delegation of authority by the President, Vice President, or the
head of an executive department or agency for the certification of
expenditures must be documented, and the certification authority that
is being delegated is to be cited.
Supporting documentation for some certificated or "unvouchered"
payments is subject to audit by the Comptroller General under specific
provisions of law. The Comptroller General is authorized to audit
expenditures accounted for only on the approval, authorization, or
certification of the President, Vice President, or the head of an
executive agency to determine whether the expenditure was made as
authorized by law (31 U.S.C. 3524(a)). However, the President is
authorized to exempt from this audit authority financial transactions
related to sensitive foreign intelligence or foreign counter-
intelligence activities or sensitive law enforcement investigations if
an audit would expose the identifying details of an active
investigation or endanger investigative or domestic intelligence
sources involved in the investigation. The presidential exemption may
apply to a class or category of financial transactions (31 U.S.C.
3524(c)). In addition, certain certificated or "unvouchered"
presidential and vice-presidential expenditures are exempt from the
Comptroller General's audit authority as well as certificated or
"unvouchered" expenditures related to the Central Intelligence Agency
(31 U.S.C. 3524(d)). However, some of the funds of the President and
Vice President that are exempted from audit by 31 U.S.C. 3524(d)(1)
are made subject to audit by 3 U.S.C. 105(d) and 106(b).
To verify that the funds were spent for the purpose claimed, the
Comptroller General is authorized access to all documentation
supporting payments made on the certificate of the President related
to (1) the executive residence, (2) the official entertainment
expenses of the President, and (3) the subsistence expenses of persons
in government service while traveling on official business in
connection with the travel of the President (3 U.S.C. 105(d)). Also,
the Comptroller General is authorized access to all documentation
supporting expenditures made for (1) the official entertainment
expenses of the Vice President and (2) the subsistence expenses of
persons in government service while traveling on official business in
connection with the travel of the Vice President (3 U.S.C. 106(b)).
While the certificates supporting payments may be filed along with
other payment vouchers, the supporting records, documents, or papers
related to certificated expenditures that are not subject to GAO's
audit authority must not be commingled with the supporting
documentation for other payments that are subject to GAO's
verification or general audit authority. Records not subject to GAO's
audit authority must be segregated from other records so as not to
interfere with the access to auditable records.
6.3 Agency Responsibility For Prompt Payments:
Agencies, as the term is defined in 5 U.S.C. 551(1), should pay their
bills on time. They are required by law (31 U.S.C. chapter 39) to pay
interest penalties when payments are made late, and to take discounts
only when payments are made within the discount period. Implementing
regulations were issued by the Office of Management and Budget in OMB
Circular A-125. The Treasury Financial Manual, volume I, part 6,
contains additional guidance regarding discounts as they concern
Treasury's cash management efforts.
6.4 Approval And Certification Of Payment Documents:
All basic vouchers, voucher schedules, and invoices or bills used as
vouchers must be certified as legal, proper, and correct for payment
by an authorized certifying or disbursing officer. The certification
of a document attests to all administrative determinations having been
made as required of an approving official. The certification of a
voucher schedule applies to all individual vouchers listed on the
schedule. The responsibilities and liability of accountable officials
are discussed in more detail in chapters 7 and 8 of this title.
6.5 Prepayment Examination Of Vouchers:
The principal objectives of the examination of a voucher are to ensure
the following.
1. The payment is permitted by law and complies with the terms of the
applicable agreement.
2. The required administrative authorizations and approvals for the
payment are obtained.
3. The payment is supported by basic payment documents or other
acceptable forms of support. (See subsection 6.2.B and C.)
4. The amount of the payment and the name of the payee are correct.
5. The goods received or the services performed complies with the
agreement.
6. The quantities, prices, and calculations are accurate.
7. All cash, trade, quantity, or other discounts are taken and, if
not, that the reason therefore is shown on the appropriate document.
8. All applicable deductions are made and credited to the proper
account in the correct amount.
9. Prompt payment requirements are followed.
10. The appropriation or fund is available at the time, for the
purpose intended, and in the amount of the proposed payment.
11. Special certificates, if required, are furnished. (See subsection
6.5.B.)
12. Duplicate payments are prevented.
Effective control over disbursements ordinarily requires the
prepayment examination and approval of vouchers before they are
certified for payment. This prepayment audit requirement and
permissible exceptions, such as vouchers approved for payment under an
authorized statistical sampling program or fast pay procedure, are
discussed further in chapter 7. Also, disbursements from imprest funds
do not require a prepayment examination and certification unless an
agency so desires. (See subsection 6.8.C.) Further, bills rendered by
one government agency to another on a reimbursable basis under 31
U.S.C. 1535, 1536, or similar provisions of law, are not subject to
prepayment examination or certification in advance of payment but
appropriate follow-up steps are required. (See subsection 2.4.C.)
Payments for transportation services are subject to special audit
requirements. In general, certifying and disbursing officials are not
responsible for overpayments due to improper rates, classifications,
or failure to make proper deductions under equalization or other
agreements with respect to charges for transportation services where
the charge is subject to the centralized postpayment audit by GSA (31
U.S.C. 3322(c), 3528(c), and 3726(a)). However, these officers will be
held responsible for overcharges due to illegal payments, mathematical
errors, or other errors in the paying operation.
B. Special Requirements for Specific Types of Disbursements:
Special certifications shall be made when required by law. Each agency
head and each authorized certifying or disbursing officer must be
aware of applicable statutory and regulatory requirements and comply
with them. Appendix IV of this title contains some of the special
certifications that have governmentwide application.
C. Administrative Adjustment of Claims:
Payments should not be made until the certifying or disbursing officer
determines that the payment is proper, correct, and supported by the
required documentation. However, there may be variances between the
amount claimed by the payee and the proper amount determined by the
agency to be payable during the examination of payment documents. If
these variances are underclaims of a small amount and the documents
show that the claimant intends to make a claim for the full amount
due, agencies may establish an amount not to exceed $100 for upward
administrative adjustment of payment vouchers (claims against the
government) unless it is otherwise prohibited by law. The amount
established is to be based on the risk to the government, extent of
internal controls in operation, and the type of claims involved. The
amount established within the limit for upward administrative
adjustment need not be the same for all categories of claims.
These administrative adjustments may be made without amendment of the
claim by the claimant when it is clear on the face of the payment
documents that the adjustment is appropriate. For example, the
documentation submitted for payment by the claimant shows obvious
errors in computations or extensions. Agency management is to
periodically review the procedures established under this provision to
provide assurance that fraud and/or abuses are not taking place.
Downward adjustments of payments based on corrections of the claim may
be made in any amount.
6.6 Internal Controls Over Disbursements:
A. General Requirements:
Each agency's system of internal control over disbursements should be
based on the operating needs of that particular agency and should
conform to related principles and standards for accounting and
administrative internal controls prescribed in Title 2 of this manual.
Automated and manual system structures and controls, for the most
part, are addressed in Title 2, appendix III, chapter 2.
B. Separation of Duties:
To the extent practicable, operations should be separated to reduce
risk of error, waste, and wrongful acts. In automated systems, a
separation of duties should be achieved by the assignment of different
responsibilities by function. For example, different responsibilities
should be assigned to computer operations personnel, software
maintenance specialists, and users. Further, user responsibilities
include ensuring that disbursing operations are separated from such
operations as purchasing, receiving, and accounting; internal controls
and procedures are properly implemented; and errors are promptly
resolved.
C. Avoiding Duplicate Payments:
Agencies should establish such procedures as are necessary to prevent
duplicate payments. Vouchers, voucher schedules, and supporting
documents should be identified during the payment process by an
acceptable means, such as marking or electronic coding, which will
prevent them from being paid again. In addition, controls in the
automated system should be designed to detect duplicate payments.
If an original invoice has been lost or destroyed, a duplicate should
be obtained. A full explanation of the circumstances of the loss or
destruction of the original invoice and of steps taken to prevent
duplication of the payment should be added to or attached to the
duplicate invoice before it is processed for payment.
The possibility of duplicating payments is greater whenever a second
invoice or billing statement has been received. This may occur, for
example, when payment has been delayed for an extended period and a
duplicate or adjusted follow-up invoice is submitted, or when a vendor
submits bills to more than one agency location.
D. Disbursements for Accounts Payable of Closed Appropriations:
Controls must be established over disbursements for any accounts
payable applicable to closed appropriations because of limitations on
such payments. Because disbursements cannot be made from
appropriations that are closed, agencies are authorized to pay
accounts payable applicable to closed appropriations from an unexpired
appropriation within certain limits. See section 4.4 of this title for
application of the limitations.
Records and controls must be maintained for any accounts payable
remaining in the appropriation at the time the appropriation was
closed to ensure compliance with these requirements. (See section 4.5.)
6.7 Use Of Credit Cards For Purchases:
Agencies may arrange with companies for the issuance of credit cards
to make purchases. These arrangements have taken various forms. For
example, agencies have been using government credit cards for the
purchase of fuels and other automotive services for government
vehicles from vendors that have contracts with the Defense Fuel Supply
Center. Another approach involves use of bankcards for small purchases
by authorized employees, with consolidated monthly billings to the
agency.
Agencies should establish appropriate procedures and controls over
credit card use to minimize the risk of loss, theft, and unauthorized
use. These procedures and controls should include (1) keeping a record
of persons to whom the cards have been issued and limiting the number
issued, (2) ensuring that cards no longer needed are turned in for
cancellation and expired cards are obtained and destroyed, and (3)
reporting lost or stolen cards promptly to the issuing organization.
Additional administrative controls such as appropriate limits on the
dollar amount and the nature of the credit card purchase should also
be established.
Agencies using the U.S. Government National Credit Card (SF-149) may
pay vendor billings for credit card charges without submitting paper
charge card receipts with the invoices, if acceptable methods (e.g.,
electromagnetic or other means) are used to ensure that the purchases
are authorized and the interests of the government are protected. (See
Comptroller General Decision, B-214459, Nov. 12, 1987.) Any credit
card payment system must provide reasonable assurance that the
government is being asked to pay only that which it is properly
obligated to pay, and must include the capability of verification
through audit.
With respect to theft or misuse of commercial credit cards, the
government has no liability based on the established principles that
the government is neither bound nor estopped by acts of officers or
agents acting without authority, nor is it bound by acts of persons,
such as thieves, who never have been its agents. (See 64 Comp. Gen.
337 and 341 (1985).)
In addition to the above types of credit card arrangements, in which
the billings are presented to the agency for payment, governmentwide
contract arrangements have been made by GSA under which credit cards
may be issued directly to federal employees for payment of travel
costs. The traveler pays the credit card contractor based on monthly
bills and submits travel vouchers to the agency for reimbursement of
allowable travel costs.
6.8 Imprest Funds:
This section sets forth the requirements for using imprest funds for
small cash disbursements. Regulations concerning the establishment and
maintenance of funds and the responsibilities of cashiers who operate
the funds and disbursing officers are contained in the Treasury
Financial Manual, volume I, part 4.
A. Purpose and Amount of an Imprest Fund:
An imprest fund should satisfy a definite and continuing need of an
agency for making relatively small cash disbursements. Disbursements
from imprest funds usually are made (1) to vendors for goods and
services and (2) to employees as advances or reimbursements for
authorized expenditures.
An imprest fund should be limited to an amount commensurate with the
authorized purpose of the fund and normal disbursements during an
administratively established period. An imprest fund should be
discontinued or adjusted in size whenever circumstances warrant such
action.
B. Accountability for Imprest Funds:
The cashier of the imprest fund is personally liable for all money in
the fund and will be required to replace the funds if they are lost,
stolen, or misappropriated, unless relieved in accordance with chapter
8 of this title. However, personal liability does not extend to
cashiers or other officials using Treasury's third-party draft payment
system since nongovernment funds are being used. Instead, they are
administratively accountable. (Requirements for third-party payment
systems are contained in the Treasury Financial Manual, volume I, part
4, chapter 3000.)
At any given time, an imprest fund may consist of cash, checks, or
various documents supporting,cash payments. Cashiers must be able to
account for the full amount of the funds.
Imprest funds must not be commingled with personal funds or other
funds.
When the propriety of any disbursement is doubted, the cashier may
require written acceptance of responsibility from the official
authorizing the disbursement. Such written acceptance of
responsibility provides the cashier recourse to the official if the
disbursement is later disallowed, but does not, in itself, relieve the
cashier of responsibility for the disbursement.
The cashier may also request an advance written opinion from the
certifying officer or, if applicable, from the disbursing officer as
to the legality of a disbursement. If the certifying or disbursing
officer cannot decide the legality of the disbursement, the officer
may submit the question to the Comptroller General for a decision.
C. Agency Responsibilities:
Agencies having imprest funds shall issue regulations and establish
procedures for their use, consistent with the requirement's of the
Treasury Financial Manual, volume I, part 4. All documentation
pertaining to the establishment of an imprest fund should be furnished
to the agency's fiscal office so that appropriate entries may be made
in the accounting records of the agency. Agencies should advise
cashiers of their responsibilities and furnish them suitable
facilities for safeguarding the funds.
It is the responsibility of each agency to maintain appropriate
accounting and internal controls-for the assets held by an imprest
fund cashier. Accounting should be as simple as practicable, while
being consistent with effective management, and with the control
necessary for ensuring compliance with the requirements of section
1341 and subchapter II of, chapter 15 of Title 31, U.S. Code.
D. Verifications and Audits of Imprest Funds:
Each agency that has an imprest fund shall make periodic audits of the
fund. The audits should be unannounced and conducted so that the
timing of the audits is not predictable. They should include
verification of balances and steps, such as analyzing fund activities
over a several-month period; that could disclose theft or fraud.
Any unauthorized use of, irregularities in, or improper accounting for
an imprest fund disclosed by an agency verification or audit shall be
reported promptly to the head of the agency so that any necessary
corrective action may be taken and the accountability records of the
disbursing officer may be properly adjusted.
In addition to describing the irregularities, the report should state
whether prescribed procedures and requirements were being followed and
recommend any action considered to be necessary or desirable for
preventing recurrence of the irregularities and for strengthening
control over the administration of the fund. Requirements for
resolving and reporting such irregularities are in chapter 8 of this
title.
6.9 Grants And Cooperative Agreements:
Through grants or cooperative agreements, the federal government
provides assistance to state and local governments and to
nongovernment recipients. Such agreements usually provide for advances
of funds for the performance of planned activities without substantial
federal involvement. Procedures to ensure the propriety of grant
authorizations, disbursements, and related follow-up procedures will
vary among programs.
For guidance on grant operations, agencies should look primarily to
the authorizing legislation, implementing agency regulations, and the
requirements established by OMB and Treasury. OMB's publication M-85-
10, Financial Management and Accounting Objectives, which supplements
Circular A-127, provides agencies with some guidance on categorical
grant program controls, including requirements for recordkeeping, fund
control, monitoring cash drawdowns, audits, and audit follow-up. In
addition, certain financial requirements are imposed on recipients
through OMB Circulars A-102 (pertaining to grants to state and local
governments) and A-110 (pertaining to grants to higher educational
institutions, hospitals, and other nonprofit organizations). The
Treasury Financial Manual (volume I, part 6, chapters 2000 and 2500)
provides guidance on cash advances under grant and other programs,
including letters of credit.
6.10 Periodic Reviews:
Agency management should provide for periodic review of all disbursing
operations to ensure that the prescribed requirements are being
observed and that the control structure is effective. As discussed in
section 7.5, reviews that provide reasonable assurance that disbursing
procedures and controls are effective and working are necessary
support for reports required by the Federal Managers' Financial
Integrity Act and to support the certification function. Also, cash
management related reviews are required by the Treasury Financial
Manual, volume I, part 6.
[End of Chapter 6]
Chapter 7: Concepts Of Federal Accountability And Responsibilities Of
Accountable Officers:
7.1 Accountability Concept:
When entrusted with or statutorily made responsible for public funds,
government employees are, in effect, trustees for the taxpayers. These
"accountable officers" encompass such officials as authorized
certifying officers, civilian and military disbursing officers,
collecting officers, and other employees who by virtue of their
employment are responsible for or have custody of government funds.
These officials are personally liable for the loss or improper payment
of the funds for which they are accountable.
A. Responsibilities of Certifying Officers:
Certifying officers are accountable for and required to personally
reimburse the government for any illegal or otherwise improper payment
made by a disbursing officer because of their certification. However,
unlike disbursing officers or collectors of public moneys, certifying
officers have no public funds in their possession.
As required by 31 U.S.C. 3528, a certifying officer will be held
accountable for:
1. the existence and correctness of the computations and facts stated
in a voucher and its supporting records,
2. the legality of the proposed payment under the appropriation or
fund involved, and,
3. unless relieved of liability by the Comptroller General or a
delegatee, as provided in chapter 8 of this title, repayment of the
amount of any:
a. illegal, improper, or incorrect payment resulting from any false,
inaccurate, or misleading certificate made by the officer, and,
b. payment prohibited by law or which did not represent a legal
obligation under the appropriation or fund involved.
B. Responsibilities of Disbursing Officers:
Section 3325(a) of 31 U.S.C. provides that an executive agency's
disbursing official shall disburse money only as provided by a voucher
certified by the head' of the agency or by an authorized certifying
official. In addition, a disbursing official is accountable for
ensuring that a voucher is in proper form and is certified and
approved.
Where agencies are not subject to 31 U.S.C. 3321(a) and do their own
disbursing, such as the military departments, the disbursing officers
are also responsible for performance of the certifying functions. They
must ensure:
1. the propriety of the voucher,
2. the legality of disbursements,
3. the correctness of computations, and,
4. the accuracy of the facts stated in the vouchers and supporting
records.
7.2 Reliance On Systems And Related Controls:
A. Shifting Emphasis Due to Automation:
Problems caused by the high volume of transactions, geographic
dispersion of activities, and emphasis on prompt payment in today's
federal financial environment need to be dealt with effectively.
Electronic techniques and systems are being used to generate, process,
transmit, and store financial information. Moreover, agencies that
obtain financial services from other agencies through cross-servicing
agreements must share responsibilities. In the complex environments
created by the use of such systems, it is usually impractical for
accountable officials to personally examine each transaction for which
they are responsible. Consequently, in fulfilling their
responsibilities, accountable officials must rely on the systems,
controls, and personnel that process the transactions.
This necessary shift in emphasis from examining individual
transactions to relying on the adequacy of systems and related
controls has been reflected in the policy guidance and audit reports
such as 69 Comp. Gen. 85 (1989) and GAO's report FGMSD76-82. Also, the
requirement in the Federal Managers' Financial Integrity Act of 1982
(FMFIA) (31 U.S.C. 3512(d)) for recurring assessment by agency
management of the adequacy of accounting systems and management
controls contributed to emphasizing system operations. Standards for
internal controls and accounting systems are contained in appendixes
II and III of Title 2 of this manual. In addition, OMB requirements
for evaluating financial systems and controls are contained in OMB
Circulars A-123 and A-17. Together, the OMB and GAO guidance establish
the criteria and rules for assessing and reporting annually on the
status of agency systems and controls.
B. Reasonableness of the Reliance on Systems and Controls:
Relying on systems and controls and the existence of general
requirements for their periodic assessment as well as presuming that
the system and controls are working well, however, creates the risk
that certifications of disbursement vouchers may become too routine.
While new developments may alter the way in which certifying and
disbursing officers operate, and may thus result in some redefinition
of the conditions under which they may be granted relief, the basic
legal liability of their accountability remains unaltered.
Therefore, if certifications are to be meaningful, a further basic
policy concept that must be applied is that the certifying and
disbursing officials must have reason for believing that the key
processes and controls on which they rely are working. This confidence
in the system and controls should be based on a number of factors and
among the most significant are the following.
1. A well-defined organizational structure and flow of work, with
appropriate separation of responsibilities and clearly written
policies and procedures governing the examination, approval, and
certification of disbursement vouchers.
2. Effective application of available technology and concepts to
achieve efficient and effective voucher processing.
3. Review of the voucher processing procedures and controls in
sufficient scope, depth, and frequency to provide reasonable assurance
that key processing procedures and controls are working and reliable.
Whenever a request for relief from repayment of an amount erroneously
paid is supported by a contention that the certifying or disbursing
official relied on the system and its controls, the reasonableness of
such justifications--that is, the basis for such reliance--will be
carefully considered before relief is granted.
7.3 Organizational Structure And Operating Procedures:
The functions, authorities, and responsibilities of the various parts
of an agency's financial organization and of the key personnel must be
clearly defined. The policies and procedures applicable to the
agency's financial operations should be in writing and readily
available. Separation of key duties and responsibilities for
authorizing, processing, recording, and reviewing transactions will
ensure that checks and balances exist. Clear definition of the voucher
processing objectives, procedures, and controls will provide prompt,
consistent guidance to all personnel and will promote discipline and
stability in daily operations.
Administrative approval and/or certification of a voucher for payment
will usually result from a combination of specific manual and
automated procedures and controls which are systematically completed
to support the approval of the proposed payment. Completion of the
steps used to examine vouchers may involve several individuals, each
with responsibility for specific actions, such as initiation and
completion of receiving and inspection reports; data entry; data
transmission and authentication; and ensuring the consistency of
information from invoices, obligating documents, and receiving reports.
As indicated in subsection 7.2.B, the fact that some portion of the
prepayment audit is automated, decentralized, performed by another
agency or a contractor, or otherwise not within the certifying
official's direct control, does not alter his or her basic
accountability and legal liability for the propriety of the payment.
However, in considering requests for relief from liability for payment
irregularities in accordance with chapter 8 of this title, one of the
key concerns will be whether the certifying official was negligent or
justified in relying on the system and its various controls. Thus,
when certifying officials find it impractical to confirm first hand
that transactions meet legal requirements, that goods or services have
been received in satisfactory condition, and that amounts are
correctly computed, they should know that these determinations are
being made by others who are charged with that responsibility.
These concepts are also applicable to cross-servicing arrangements
when one agency has all or part of its accounting or financial
services performed by another agency. Because such cross-servicing
arrangements result in sharing responsibilities, careful delineation
of each agency's respective responsibilities is required. Cross-
servicing agreements are to define the extent of each agency's
reliance on the other and the responsibilities of each for complying
with applicable reporting and certification requirements. Typically,
officials of each agency will find it necessary to rely on actions,
assurances, or administrative approvals by personnel of the other
agency. Examples of the just-mentioned responsibilities include
certifying vouchers for disbursement, as described in subsection
7.1.A; preparing and certifying reports on obligations, as described
in sections 3.7 and 3.8; and making annual reports and certifications
regarding the adequacy of the internal control and accounting systems,
as described in section 7.5.
The integrity of such systems requires that (1) responsibilities be
designated, (2) individuals understand their responsibilities and the
consequences of their actions, and (3) individuals be held accountable
for their performance. Defining and documenting the responsibilities
and accountability of each organizational unit and individual involved
in the voucher processing operation makes each individual better able
to rely on actions by others, which provides a framework in which
certifying and disbursing officers can rely on the actions of other
cognizant personnel.
7.4 Application Of Available Technology And Concepts:
A. Technology Provides Voucher Examining Alternatives:
In large-volume, highly automated voucher processing operations,
automated control procedures, electronic data interchange, and
computer-assisted audit techniques provide viable alternatives to the
traditional practice of performing a 100-percent prepayment
examination of vouchers. Agencies should consider the various
alternative techniques for voucher processing and examining that might
be used effectively. Depending on the particular needs of officials
who approve, certify, and disburse, agencies should incorporate an
appropriate mix of such tools into their voucher processing procedures
and controls. For example, agencies may make payments to vendors based
on facsimile invoices (B-242I85, Feb. 13, 1991). In addition, agencies
may use electronic data interchange procedures to create valid
contractual obligations (B-245714, Dec. 13, 1991). Such techniques
should be part of a total system that includes well-defined
responsibilities, organizational structures, and an adequate set of
internal controls. In addition, effective evaluations are to be
conducted to verify that established procedures and internal controls
are working.
Automated processes, controls, and audit techniques often can be used
effectively in conjunction with the traditional manual ones. As a
general policy, agencies should endeavor to establish automated
processing techniques and controls whenever they are feasible. This
policy, however, is not viewed as a relaxation of voucher examining
requirements. For example, ensuring the consistency of supporting
documentation (see subsection 6.2.B) is required under any acceptable
voucher processing approach. Some of the more significant techniques
and approaches are summarized below. Other approaches, or variations
of those discussed, may also be acceptable, so long as they meet
applicable legal requirements and their use will be in the best
interest of the government.
B. Computer Edits:
The repetitive nature of most voucher processing transactions and the
application of uniform examination rules usually permit extensive
automation of these processes. Effective data entry edits are
especially important because they are relatively simple to develop and
use and they help detect and prevent errors before the errors are
entered into the computerized files. Automated systems can be
programmed to perform various comparisons, verifications, and
calculations, and to produce outputs that effectively replace the
manual voucher processing and examining procedures. Automated
financial systems are discussed more fully in appendix III of Title 2
of this manual, which describes accounting system standards for
applicable federal agencies.
C. Data Authentication and Electronic Certification:
With the proper application of available technology, it is possible to
perform required prepayment audits without assembling the source
records from other locations. For example, different personnel can
extract information from source records, input it to an automated
system through computer terminals, and forward the data through
communications networks to a centralized location for further
processing, certification, and payment. However, using this approach
requires agencies to implement techniques that will provide reasonable
assurance that data in electronic messages are complete, correct, and
authorized in order to protect the government's legal and financial
interest.
Implementation of electronic technologies requires that (1) the
voucher processing system be carefully structured and monitored to
ensure that audit trails are maintained (including agency compliance
with prescribed record retention requirements) and (2) officials who
are responsible for authorizing, certifying, and disbursing know the
requirements of the system in order to carry out their
responsibilities effectively. Depending on agency need and preference,
this structure can include a network of approving officials and/or
assistant certifying officials, many variations of centralized/
decentralized processing, and telecommunications systems with
differing levels of control. Whatever the structure, individual
responsibilities and the basis for the final certification and payment
must be clear.
Various techniques can be used in the data authentication process
which when properly implemented can provide reasonable assurance that
data in support of certifications or disbursements are authorized,
accurate, and complete. Guidance on computer and data security is
provided by the National Institute of Standards and Technology (NIST)
in its Federal Information Processing Standards (FIPS) publications.
NIST promulgates standards and guidance for computer security related
to sensitive but unclassified information. Agencies should refer to
NIST standards and guidance prior to developing electronic data
authentication and certification systems. Reasonable assurance that
the government's interest is protected when using electronic systems
will depend on the agency's proper implementation of the appropriate
NIST standards coupled with the implementation of an adequate set of
controls that properly secure the systems.
If the final certification of vouchers is accomplished electronically,
the electronic signal or symbol adopted as the certifying officer's
electronic signature must be (1) unique to the certifying official,
(2) capable of verification, and (3) under the sole control of the
certifying official. Electronic certification of the final voucher
also requires that control procedures be in place to ensure the
authenticity of transmitted data, including the electronic signature.
Such controls must provide reasonable assurance that deliberate or
inadvertent manipulation, modification, or loss of data during
transmission is detected.
D. Fast Pay Procedures:
Effective control over disbursements ordinarily requires prepayment
examination and approval of vouchers before they are certified for
payment. However, partial exceptions to the prepayment audit
requirement, known as fast pay, have been allowed by GAO. Past fast
pay approvals have involved deferral of specific examining steps,
usually the verification of receipt and inspection of goods or
services, on the condition that they be performed after payment. Fast
pay procedures generally have been limited to payments for goods or
services where there has been a continuing relationship with reliable
vendors and the procedures have permitted agencies to take advantage
of prompt payment discounts or to effect other economies.
Executive branch guidance applicable to fast pay procedures is in OMB
Circular A-I25, which provides guidance to implement the Prompt
Payment Act, and the Federal Acquisition Regulation (FAR), part 13.
Both A-125 and FAR permit use of fast pay procedures to pay vendor
invoices without evidence of receipt at the time of certification and
payment and subject to a general limitation of $25,000 and certain
other restrictions. These additional restrictions include, for
example, (1) that geographical separations and a lack of communication
facilities make it impractical to make timely payment based on
evidence of acceptance, (2) that suppliers who will be paid under the
procedure agree to replace, repair, or correct supplies not conforming
to purchase requirements, and (3) that the agency have a system in
place to identify suppliers who have a history of abusing the fast
payment procedure.
Agencies do not need specific GAO approval to implement fast pay
programs that meet A-125 and FAR conditions for fast pay. When clearly
warranted, additional specific case approvals may be authorized by
GAO. (See subsection 7.4.G.) However, such past abuses as failing to
complete required audit steps following payment make it especially
important that such proposals be well justified and, if implemented,
carefully monitored.
E. Statistical Sampling:
Subject to limitations prescribed by the Comptroller General, agency
heads are authorized by 31 U.S.C. 3521(b) to establish statistical
sampling programs for the examination of vouchers in support of their
certification and payment.
In accordance with this authority, agencies may use statistical
sampling for vouchers in amounts not exceeding $2,500. Within this
maximum, agencies are required to establish their own dollar
limitations based on cost/benefit analyses of their voucher examining
operations. In determining whether travel vouchers exceed the
limitation, agencies may exclude any passenger transportation costs
paid through the General Services Administration's contractor issued
charge cards; such costs are subject to audit by the General Services
Administration's transportation rate auditors.
Any disbursing or certifying official relying in good faith on the
statistical sampling procedure adopted by the agency to disburse funds
or certify a voucher for payment will not be liable for losses to the
government resulting from payment or certification of a voucher not
audited specifically because of the use of the sampling procedure,
provided that the agency has diligently carried out collection actions
prescribed by the Comptroller General (31 U.S.C. 3521(c)). (See
appendix III for a further discussion of statistical sampling,
including plans for development, documentation, and monitoring.)
F. Combining Fast Pay Procedures and Statistical Sampling:
Voucher examining plans that combine elements of fast pay and
statistical sampling may be used in appropriate circumstances. Such
plans must provide for (1) audit emphasis commensurate with the risk
to the government, (2) sampling of all invoices not subject to
complete audit coverage, (3) effective monitoring, and (4) a basis for
the certification of payments (67 Comp. Gen. 194 (1987) and 68 Comp.
Gen. 618 (1989)).
In general, however, whenever the need for timely, economical, and
effective prepayment verification of the propriety of payment vouchers
can be met through system improvements, whether by increased
automation or otherwise, that alternative is preferred over others
that involve the relaxing of controls or audit requirements.
G. Requests for Alternative Procedures:
As a final alternative, if an agency determines that in its particular
situation a voucher examining plan that differs from the procedures in
this title will produce savings while adequately protecting the
government's interest, it may request approval of the specific plan
from GAO. The request must be in writing and contain a description of
the plan, including any procedures for statistical sampling, and a
description of the agency's specific situation and conditions that
warrant deviation from the procedures in this title for examining
vouchers. If anticipated savings are due primarily to a proposed
reduction in audit intensity or timeliness, the request also should
explain the consideration given other alternatives and the basis for
selecting the alternative that has been proposed.
Such requests should be directed to:
Assistant Comptroller General:
Accounting and Information Management Division:
U.S. General Accounting Office:
441 G Street, NW:
Washington, DC 20548:
Approval of such proposed alternatives will be on a case-by-case basis
and applicable only to a specific situation. When such alternative
procedures are approved, the agency should periodically evaluate
whether advances in communications technology or other electronic
systems capabilities afford the agency the opportunity to achieve a
100-percent examination of vouchers prior to payment.
7.5 Evaluations Of The Voucher Processing System And Controls:
A. Review Requirements:
The results of various reviews or tests of the financial management
system and its controls are important indicators of whether such
systems and controls are adequate to support certifications.
Requirements that agencies conduct systematic internal reviews,
independent of the examinations of disbursing and collecting
transactions required of accountable officers, have existed for many
years. For example, such requirements were emphasized in an August 1,
1969, letter from the Comptroller General to heads of agencies (B-
161457). The objectives of these independent reviews included ensuring
that (1) appropriate examinations of transactions were being made to
verify their legality, propriety, and correctness at the time when any
needed preventive or corrective action could be most effectively
taken, (2) effective controls were maintained over disbursements,
collections, and balances for which accountable officers were
responsible, and (3) appropriate administrative actions were taken to
correct problems.
Since the enactment of FMFIA, all executive agencies are required to
review their systems of accounting and management controls and to
report annually to the President and Congress on the results of the
reviews, including any plans to correct significant deficiencies. The
requirement for making such reviews and reports is especially
appropriate in today's highly automated environment because the
officials responsible for certifying or otherwise approving the
payment of federal funds must rely on automated systems and controls,
rather than on personal examination of individual transactions.
The results of FMFIA reviews may be of value to certifying and
disbursing officers. However, broad-scoped FMFIA reviews may not be
sufficient justification for certifying and disbursing officials to
rely on the system and its controls. To be useful, these reviews need
to be of sufficient scope and detail to identify any problems, causes,
and necessary corrective actions applicable to payment processes.
Certifying and disbursing officials may also be able to rely to some
degree on other types of reviews of voucher processing operations. For
example, reviews and corrective actions pursuant to the Computer
Security Act of 1987, Public Law 100-253, enacted January 8, 1988,
should help ensure reliability of the data processed by automated
systems. Also, when made, reviews of voucher processing procedures or
controls by inspectors general should provide management with useful
information on system strengths and weaknesses. Reliance on these
reviews will depend on their scope, timing, and objectives which may
not necessarily provide continuous assurance of the adequacy of the
voucher processing system.
B. Using FMFIA Reviews:
To the extent practicable, the needs of certifying and approving
officials should be considered in advance of FMFIA reviews and the
review results should be made available or communicated to them in
reports tailored to their special interests. The FMFIA detail reviews
should be designed, carried out, and reported in ways that show
whether the voucher processing and disbursing system and controls are
reliable. This information, combined with other knowledge of strengths
and weaknesses in the system and related controls, will help to
determine whether further procedures, controls, and tests are needed
to adequately support the required certifications.
Further review and testing can take a variety of forms. These include
statistical sampling of transactions already processed for payment to
confirm the effectiveness of existing procedures and controls or the
use of specially designed test transactions to verify that all system
edits and routines are working properly--that is, that errors are
detected and rejected and transactions are correctly processed.
C. Special Requirements for Certification, Processing, and Reporting
if Weaknesses Exist:
The identification of weaknesses in a voucher processing system should
result in prompt and effective corrective action. Pending completion
of these corrective efforts, certifying officials may be able to
satisfy themselves that payments are proper by relying on 'alternate
procedures and controls. Also, if a designated assistant secretary or
comparable official provides his or her agency head and GAO with a
written statement that effective system controls could not be
implemented prior to voucher preparation and, further, certifies that
the payments are otherwise proper, GAO-will not consider the absence
of such controls as evidence of negligence in determining whether or
not the certifying official should be held liable for any erroneous
payment made prior to receipt of an advance decision. (See section
8.3.) However, if the situation remains uncorrected, follow-up reports
showing the status of corrective actions must be submitted to the head
of the agency at 90-day intervals following the date of the first
written statement. Further, such weaknesses should be fully disclosed
in the annual FMFIA reports to the President and Congress.
Of course, the traditional requirements that due care be exercised in
making the payments and that diligent effort be made to recoup any
erroneous payments will still be considered in any requests for relief
of liability. (See Principles of Federal Appropriations Law.)
[End of Chapter 7]
Chapter 8: Settlement Of Accounts And Relief Of Accountable Officers:
8.1 Authority And Responsibility:
GAO has the authority and responsibility to settle the accounts of
accountable officers as provided in 31 U.S.C. 3526. This authority
extends to certifying and disbursing officers and collecting
officials. The responsibilities of certifying and disbursing officers
are described in chapter 7 of this title. Responsibilities of
collecting officials are covered in chapter 5 of this title.
Except for those requirements identified as pertaining to a specific
type of accountable officer, the requirements discussed in this
chapter apply to all accountable officers.
8.2 Definition Of Fiscal Irregularity:
For purposes of the laws governing the accountability and relief of
accountable officers, fiscal irregularities fall into two categories:
physical loss/deficiency and improper payment.
A physical loss or deficiency is a shortage of public funds in an
account, including imprest or similar funds, resulting from such
things as (1) theft (burglary, robbery, embezzlement, etc.), (2) loss
in shipment, and (3) destruction by fire, accident, or natural
disaster. An unexplained shortage (i.e., a shortage of funds with no
apparent reason or explanation) is also treated as a physical loss.
An improper payment is a disbursement of public funds by a disbursing
officer or subordinate that is found by an appropriate authority,
including the Comptroller General, to be illegal, improper, or
incorrect. Improper payments result from fraud, forgery, alteration of
vouchers, improper certifications, and other improper practices.
Improper payments can also be caused by human and/or mechanical error
during the payment process.
The term "public funds" includes appropriated funds, receipts or
collections, and funds held in trust by a federal agency, such as
personal funds of patients in a federal hospital.
8.3 Right To An Advance Decision On Certification Or Payment:
Certifying and disbursing officers are provided with a means of
protection against their liability for the certification and payment
of vouchers which may prove to be illegal or otherwise improper. As
provided in 31 U.S.C. 3529, they have the right to apply for and
obtain a decision by the Comptroller General on any question of law
relevant to any item in the voucher presented to them for
certification or payment.
In lieu of requesting a decision by the Comptroller General for items
of $100 or less, certifying and disbursing officers may rely upon the
documented advice from an agency official designated by the head of
the agency to make such determinations. This official must be
organizationally independent of the certifying and disbursing officers
and impartial to the outcome of the decision. GAO will consider the
agency decision on the propriety of any such payment to be conclusive
in its settlement of the accounts. The documented decision should be
retained and referenced to the transaction.
Certifying and disbursing officers need not request an advance
decision concerning an arbitration award that is final and binding
under 5 U.S.C. 7122(a) or (b). The award payment will be considered
conclusive on GAO. Therefore, GAO will not review or comment on the
merits of such an award. Such an award does not, however, constitute
precedent for payments in other instances not covered by the award.
When such arbitration awards are not clearly within the scope of any
existing appropriation, the expenditure generally should be charged to
the appropriation that has the most closely related purpose and scope
to that of the arbitration award.
8.4 Agency Responsibilities:
A. General:
Each agency must maintain appropriate accounting and internal
controls, including internal audit, over the assets for which it is
responsible. For accountable officers, this includes assuring the
legality, propriety, and correctness of disbursements and collections
of public funds. In addition, periodic assessments of and reports on
the adequacy of agency controls and accounting systems are required by
FMFIA, 31 U.S.C. 3512(d). Irregularities in accounts discovered by
agencies should be reported as provided in subsections 8.4.B and 8.4.C.
B. Reporting Irregularities:
Agency heads or their designated representatives will prepare a report
on each irregularity that affects the accounts of accountable officers
whose accounts are required by law to be settled by GAO. Included in
these reportable irregularities are those disclosed by agency
examinations of disbursement and collection transactions and other
internal reviews. The report of irregularities should contain the
information called for in subsection 8.12.A of this title.
Resolution by the agency of reported irregularities must be documented
in accordance with subsection 8.12.B and filed with the report.
The reports are to be retained by the agency as part of the account
records and copies sent to GAO when required by subsection 8.4.C. A
copy of each report should be provided to the accountable officer. In
addition, copies of the reports may be required by Treasury, in
accordance with its regulations.
C. Submitting Reports to GAO:
If the irregularity is resolved by the agency as described in
subsection 8.12.B within 2 years after the date the accounts are made
available to GAO for audit, reporting to GAO is not necessary. If the
irregularity is not resolved within 2 years after the date the
accounts are made available for audit, a copy of the report should be
submitted to GAO. However, it is not necessary to send a report to GAO
for (1) cases involving physical losses under $3,000 (see subsections
8.9.0 and 8.10.B), (2) certain check losses under $3,000 (see
subsection 8.1 I.C), (3) other improper payments of $100 or less (see
section 8.11), and (4) cases in which a portion of a loss, although
unrecovered, is subject to routine, ongoing recovery action by way of
offsets or installment payments agreed to by the debtor (B-239483.2,
July 8, 1991).
GAO may from time to time identify particular circumstances in which
the prompt reporting of irregularities in other specified situations
is needed. At such a time, the agencies involved will be notified in
writing.
Reports required by GAO pursuant to this section should be sent to:
Assistant Comptroller General:
Accounting and Information Management Division:
U.S. General Accounting Office:
441 G Street, NW:
Washington, DC 20548:
If the agency wishes to submit a relief request to GAO, either at the
end of the 2-year period or sooner, it must send the relief request
and a copy of the irregularity report to the address specified in
section 8.13 instead of the address shown above.
8.5 The Settlement Process:
GAO's account settlement responsibility requires an administrative
determination of the status of the accounts and the amounts due, if
any. In meeting this responsibility, GAO relies largely on the fact
that agencies are responsible for establishing and assessing their
financial systems and controls. (See section 8.4.) To determine
whether accountable officers' functions are discharged correctly and
in accordance with applicable laws and regulations, GAO monitors the
agency assessments, reports, and corrective actions and gives special
consideration to the effectiveness of collection and disbursement
procedures and controls, reports of irregularities, and transaction
testing.
For account settlement purposes, GAO requires agencies to retain, with
the account records, statements of accountability and transactions
identical to the reports submitted to Treasury for central accounting
and reporting purposes. The applicable reporting forms are SF 224, SF
1218, SF 1219, SF 1220, SF 1221, or other approved forms used in lieu
of the prescribed forms. (See appendix I.)
The extent to which GAO may examine individual accounts and specific
transactions depends largely on the effectiveness of the accounting
and internal controls of the agency involved. When irregularities are
reported or disclosed in transactions of accountable officers, GAO may
issue a Notice of Exception as described in section 8.6 or initiate
other appropriate action. The time limitation for account settlement
is discussed in section 8.7 of this title.
8.6 Issuance Of Exceptions To Certifying Or Disbursing Officers:
GAO will notify certifying and disbursing officers of exceptions taken
to items in their accounts by issuing a Notice of Exception (GAO Form
1100) or other type of written notice. When a Notice of Exception is
issued, it remains an outstanding charge in the
accountable official's account until it is resolved, even though the
account may otherwise be settled. (See section 8.7 of this title.)
A. Replies to Exceptions:
Agencies should provide prompt replies to exceptions in the space
provided on GAO Form 1100. After being administratively verified, a
reply should be signed by the responsible certifying or disbursing
officer and returned promptly to GAO.
In the event that the responsible certifying or disbursing officer is
no longer available to reply, the successor officer for the account
should furnish the administrative reply to the exception, over his or
her own signature, if it can be provided on the basis of the
information on file. In a case in which GAO may need to issue a
revised exception, the successor should provide the responsible
officer's current address in the reply.
B. Acknowledgment of Replies:
When GAO finds that a reply to an exception is satisfactory, it will
so notify the responsible officer or the administrative office
concerned, unless the concerned agency does not desire such
acknowledgment. If the reply is unsatisfactory, GAO will issue a
revised exception that explains why it is deficient.
C. Reporting Repayments:
If an exception to a certifying or disbursing officer's account is
satisfied with a repayment, a report should be sent to GAO indicating
the collection.
If the indebtedness is liquidated by a single repayment, the repayment
should be reported on the original Notice of Exception. If the
original form was sent to GAO previously, the repayment should be
reported on a copy of the form, if available, or in a letter
containing sufficient information to identify the exception.
If the repayment will be made in installments, the reply to the
original Notice of Exception should contain a full explanation of the
repayment method and schedule. The Notice of Exception will remain
open until the entire amount is collected. When the total amount is
repaid, a follow-up report should be sent to GAO indicating that the
exception is satisfied.
D. Agency Responsibility:
When a Notice of Exception is issued, the agency should keep the
exception and all forms of support identified with the transactions in
question as part of its permanent records of the account. It should
also retain and treat as account records all replies and
correspondence in connection with the exception. All records in the
account should be retained in accordance with the requirements for
record retention in Title 8.
8.7 Time Limitation On Settlement Of Accounts:
GAO is limited by 31 U.S.C. 3526 to 3 years for settling the accounts
of accountable officers. Except as discussed below, no new charges can
be raised against the accountable officer because of discrepancies in
the account after the 3-year period has expired.
GAO's general policy is to consider the end of the period covered by
the applicable statement of accountability as the beginning of this 3-
year period. (See section 8.5) Therefore, except for discrepancies
identified and reported within the 3-year period, settlement will
occur, by operation of law, without further action, 3 years after the
date that the statement of accountability is certified. However, in
cases such as duplicate payments or forgeries, GAO considers the 3-
year period to begin after notice of loss is received by the agency
from Treasury. If the loss is due to embezzlement, fraud, or other
criminal activity, the 3-year period does not begin until the loss has
been discovered and reported to the appropriate agency officials. A
settlement is limited to the personal liability of the accountable
officer; it does not extend to any liabilities of third parties.
This policy, with respect to when the 3-year period begins, assumes
that the account is substantially complete for audit purposes; that
is, the various documents supporting the statements of
accountability are available to the agency and GAO for audit. However,
unusual delays in making the supporting documentation available for
audit may suspend the running of the 3-year period. In addition, the 3-
year limitation is suspended during wartime.
Apart from physical losses, which are not subject to the 3-year
limitation of 31 U.S.C. 3526, the only irregularities in an
accountable officer's account more than 3 years old that GAO may
question are losses due to the criminal activity of the accountable
officer. This does not preclude recovery from an accountable officer
of any amount due the government under a discrepancy raised or an
exception taken within the 3-year settlement period, even though
repayment is not made until after the expiration of the settlement
period. (See section 8.6 of this title.) Furthermore, it does not
preclude recovery of money from any payee who was illegally or
erroneously paid.
8.8 Relief Of Accountable Officers: General:
As noted in chapter 7 of this title, accountable officers are liable
for the repayment of losses of public funds for which they are
accountable. This liability arises automatically, by operation of law,
at the time of the physical loss or improper payment. Under certain
circumstances, accountable officers can obtain relief from their
personal liability to repay losses.
The term "relief" refers to an administrative decision, made by a
government official authorized by law to make such a decision, that
absolves the accountable officer from liability for a loss.
At one time, vehicles for administrative relief did not exist. The
only recourses available to the accountable officer were court action
and private relief legislation. Over the years, a statutory pattern
has evolved under which administrative relief is available if various
statutory conditions are met.
The authority to grant relief is vested in the Comptroller General in
most cases and is covered in this title. Also covered is guidance to
agencies for granting relief when authorized. Agencies exercising
relief authority must ensure the independence of the official
designated to determine the propriety of the relief cases.
The details of the various relief statutes and the standards GAO has
developed in applying them are discussed in detail in GAO's Principles
of Federal Appropriations Law. The following sections summarize these
statutory requirements and provide certain procedural guidance.
8.9 Physical Loss Or Deficiency:
A. Standards for Relief:
The standards for relief, set forth in 31 U.S.C. 3527(a), and relevant
guidance in Comptroller General decisions are the bases for
determinations by agency officials and by GAO regarding the propriety
of proposed relief actions. They apply to all accountable officers
other than disbursing officers in the Department of Defense.
Relief of an accountable officer or former accountable officer from
liability for a physical loss or deficiency is authorized only if the
accountable officer's agency makes a determination that:
1. the loss occurred while the officer was performing official duties
or that the loss resulted from an act or omission by one of the
officer's subordinates,
2. the loss was not the result of fault or negligence on the part of
the accountable officer, and,
3. the loss was not the result of an improper payment.
B. GAO Determination for Losses of $3,000 or More:
When an agency believes that relief is appropriate for physical losses
of $3,000 or more, the agency must formally request relief from GAO.
The request must include the required administrative determination
made by the agency head or another delegated agency official that
relief is appropriate. (See subsection 8.9.A.) Documentation of any
delegation, in whatever form the agency deems suitable, need not be
furnished to GAO but should be available if requested. GAO will review
the record and respond in writing to the official who submitted the
request. If GAO agrees with the agency's determinations, relief will
be granted. Because of the requirement for an agency determination,
however, GAO generally will be unable to act solely on a request
submitted directly by the accountable officer.
C. Agency Determination for Losses Under $3,000:
For losses of less than $3,000, relief requests need not be submitted
to GAO. The agency may grant or deny relief based on administrative
determinations with respect to the standards for relief. (See
subsection 8.9.A.) A central control record of such actions should be
maintained by each agency and documentation showing the basis for
actions taken should be retained for subsequent review by management
or audit personnel. (See section 8.12.)
The $3,000 limitation applies to single incidents or the total of
similar incidents which occur about the same time and involve the same
accountable officer.
8.10 Physical Loss Or Deficiency: Department Of Defense Disbursing
Officers:
A. Standards for Relief:
For disbursing officers of the armed services, relief for a physical
loss may be granted by the Department of Defense or the appropriate
military department regardless of the amount. Otherwise, the standards
for relief in Department of Defense physical loss cases are similar to
those for civilian agencies. The defense or military department may
grant relief to disbursing officers only when it determines that the
loss:
1. occurred while the disbursing officer was in the line of duty,
2. occurred without fault or negligence on the part of the disbursing
officer, and,
3. was not the result of an improper payment (31 U.S.C. 3527(b)).
B. Agency Determinations:
Unlike determinations under 31 U.S.C. 3527(a), administrative
determinations by military departments under 31 U.S.C. 3527(b) are
conclusive on GAO. In military physical loss cases in which the
required administrative determinations are made, the granting of
relief follows automatically. (See subsection 8.10.A.) Therefore, a
relief request need: not be submitted to GAO, regardless of the
amount. However, the requirements stated in subsection 8.4.0 for
reporting irregularities to GAO are not negated by this section.
Determinations made under 31 U.S.C. 3527(b) should be documented and
retained by the agency for purposes of review by management and audit
personnel.
8.11 Improper Payment:
Improper payments, for purposes of accountable officer relief, are
losses that cannot be classified as physical losses and relief is
generally vested in the Comptroller General. However, for items valued
at $100 or less, the agency official designated to make advance
determinations of the propriety of payments in section 8.3 of this
title may make similar determinations after certification or payment.
Agencies may then resolve such items found to be improper by following
the standards for relief in this section. Therefore, there is no need
of GAO involvement for items resolved by the agencies.
A. Standards for Relief: Disbursing Officers:
A disbursing officer may be relieved from liability for an improper
payment if it is determined that the payment was not the result of bad
faith or lack of reasonable care on the part, of the disbursing
officer. (See 31 U.S.C. 3527(c).) Relief may be requested by the
agency involved or the disbursing officer. Relief action may also be
initiated by GAO.
B. Standards for Relief: Certifying Officers:
A certifying officer may be relieved from liability for an improper
payment if it is determined that:
1. the certification was based on official records and the certifying
officer did not know, and by reasonable diligence and inquiry could
not have discovered, the correct information; or;
2. the obligation was incurred in good faith, the payment was not
specifically prohibited by statute, and the government received value
for the payment. (See 31 U.S.C. 3528(b)(1).)
Requests for relief may be made by the agency involved or the
certifying officer. GAO may also initiate the relief action.
C. Certain Check Losses:
1. Duplicate check losses.
Duplicate check losses result when a payee claims nonreceipt of an
original check, the government issues a substitute or replacement
check, and both checks are negotiated. The loss actually occurs when
the second check is negotiated. The order in which the checks are
cashed is irrelevant. Duplicate check losses under $3,000 need not be
submitted to GAO for relief but may be resolved by the agency in
accordance with the applicable relief statute and relevant Comptroller
General decisions. (See section 8.8.) Agencies should document relief
decisions under this authority and retain that documentation for
subsequent review by management or audit personnel. (See subsection
8.12.B.)
For duplicate check losses of $3,000 or more, all requests for relief
must be sent to GAO for resolution.
2. Losses resulting from mechanical or clerical error during the check
issuance process.
Losses in this category are attributable to such situations as
typographical and automated entry errors and equipment malfunctions.
Losses of $3,000 or more must be submitted to GAO for relief. Agencies
need not submit losses under $3,000 to GAO for relief but can resolve
the cases in the same manner as duplicate checks.
3. Uncollectible check losses.
Disbursing officers are authorized in situations specified by 31
U.S.C. 3342 to cash checks and other negotiable instruments for
government and certain nongovernment personnel. Uncollectible losses,
which are treated as improper payments, may result from transactions
such as fraudulently negotiated checks (e.g., forged endorsements) or
personal checks returned because of insufficient funds. The statute
authorizes agencies to offset, within the same fiscal year, losses
against gains arising from transactions under the statute. In
addition, the statute authorizes any net losses from the offset to be
charged against appropriations available for that purpose. For
example, the Department of Defense has permanent authority in
10 U.S.C. 2781(2) to use its appropriations for this purpose. If it is
determined that an available appropriation cannot be charged, agencies
must request relief from GAO for losses over $100. Losses of $100 or
less can be resolved by the agencies in accordance with the procedures
in this chapter. Net gains, however, must be deposited in the Treasury
as miscellaneous receipts rather than credited to an appropriation.
When losses under 31 U.S.C. 3342 are resolved by the agencies, there
is no need for GAO involvement. Use of this authority is
discretionary, however, and agencies retain the option of seeking
relief under 31 U.S.C. 3527(c).
D. Required Collection Efforts:
The granting of relief either to a disbursing or certifying officer
does not affect the liability of the recipient of the improper
payment, nor does it affect the agency's duty to pursue collection
action against the recipient. Relief may be denied if GAO determines
that the agency has not diligently pursued collection action. Requests
for relief under section 8.11 must describe the agency's collection
efforts under the Federal Claims Collection Standards (4 C.F.R. parts
101-105) and Title 4 of this manual, or other applicable authorities.
GAO will evaluate the adequacy of such collection actions in relation
to the particular case. If relief is denied because of an agency's
failure to pursue adequate collection action, the letter of denial
will describe the perceived deficiencies. The request for relief may
be resubmitted after the agency has diligently pursued collection
actions.
8.12 Required Documentation:
A. Reportable Irregularities:
The documentation for each irregularity, either reported to GAO or
resolved by the agencies, must include the following:
1. a detailed statement of facts of the case, including the type of
irregularity, date, amount, and names and positions of the accountable
officer(s) and others involved;
2. a reference to pertinent supporting documents, such as pay records,
contracts, and vouchers;
3. a description of how the irregularity occurred and how it affected
the accountable officer's account;
4. an adequate description of procedural deficiencies, if known, that
caused the irregularity and the corrective action taken or to be
taken; and;
5. information on any recoupment already made or being considered.
B. Irregularities Resolved by the Agency:
In addition to the documentation required by subsection 8.12.A, agency
resolved irregularities should be supported, as applicable, by
documentation showing:
1. whether the questioned items were proper;
2. whether the questioned amounts were recovered from the recipient or
the accountable officer;
3. that the questioned amounts were waived under 2 U.S.C. 130c and
130d, 5 U.S.C. 5584, 10 U.S.C. 2774, 32 U.S.C. 716, or other
applicable waiver statute, and that a credit in the amount of the
waiver was granted to the accountable officer's account as authorized
by law;
4. any administrative determinations required by the applicable relief
statute, when relief is granted by the agency; and;
5. any other authorized administrative actions to resolve the
irregularities;
6. any determination denying relief.
For a discussion of waivers of claims against recipients of
overpayments of pay and allowances, see 4 C.F.R. parts 91-93 and Title
4 of this manual.
C. Requests for Relief Submitted to GAO:
Requests for relief submitted by agencies to GAO must include the
following items, as applicable:
1. a copy of any report submitted to GAO pertaining to the case under
subsection 8.4.0 of this title (if a report was not submitted
previously, a copy of the agency's report should be included);
2. a description of collection actions taken;
3. identification of an appropriation or fund to be charged if an
account adjustment is deemed necessary (see section 8.14 of this
title);
4. information showing that there was a reasonable basis for relying
on the procedures and controls in an automated system if the relief
request is based on a contention that the loss resulted from such
reliance (see section 7.2);
5. any administrative determinations required by the applicable relief
statute; and;
6. a written statement by the accountable officer or a notation by the
agency that the accountable officer chooses not to submit a separate
statement. (The accountable officer's liability arises by operation of
law and the government is not required to prove negligence. Therefore,
it is important that all accountable officers be given the
opportunity, if possible, to include a statement in their relief
requests because they have the burden of demonstrating that the loss
occurred without any fault or negligence on their part.)
D. Subsequent Developments:
Any subsequent developments relevant to the case, such as full or
partial recovery of the loss, should be documented in the account
records. If a request for relief has been submitted to GAO, such
developments should also be reported promptly to GAO.
8.13 Where To Submit Requests For Relief:
Any requests for relief submitted to GAO should be sent to the
following address:
Office of the General Counsel:
U.S. General Accounting Office:
441 G Street, NW:
Washington, DC 20548:
8.14 Adjustment Of Accounts:
A. General:
In cases in which adjustments are authorized, except for situations
covered by subsection 8.14.E, the amount of the adjustment (which may
be the entire amount of the loss or a portion of it, if part has been
recovered) will be charged to the current appropriation or fund
available for the expenses of the accountable function at the time the
adjustment is made. If an adjustment is deemed necessary and relief is
requested from GAO, the request should indicate which appropriation or
fund the agency proposes to charge, as listed in the "Federal Account
Symbols and Titles" supplement to the Treasury Financial Manual.
B. Relief Granted by GAO:
The letter granting relief by GAO will include a statement approving
the adjustment. If GAO does not cite the same appropriation or fund
proposed by the agency or concludes that the adjustment is not
warranted, the letter will include an explanation. (See 31 U.S.C.
3527(d).)
C. Relief Granted by the Agency:
In cases where an agency is authorized to grant relief and determines
that an adjustment is necessary, the agency may make the adjustment in
the manner described in this section, without any direct involvement
by GAO. Designation of agency officials authorized to approve
adjustments is to be documented and signed.
D. Relief Denied or Agency Declines to Seek Relief:
If relief is denied either by GAO or by the agency concerned, or the
agency declines to seek relief because the loss is deemed attributable
to fault or negligence of the accountable officer, and the agency
determines that (1) the loss cannot be recovered from the accountable
officer or from any payee, beneficiary, recipient, or other liable
party, and (2) an adjustment is necessary, the agency may make the
adjustment as provided in this section without further involvement by
GAO. The adjustment does not affect the accountable officer's
liability for the loss. (See 31 U.S.C. 3530.)
E. Other Situations:
If an adjustment is necessary and cannot be made under subsections
8.14.B, C, or D, the agency may make the adjustment from (1) the
unobligated balance in the expired account for the fiscal year for
which the adjustment is needed, in accordance with 31 U.S.C. 1553(a),
or (2) current appropriations available for the same purpose, in
accordance with 31 U.S.C. 1553(b), if the applicable account is
closed. Such a situation might arise, for example, in the case of an
improper payment where (1) the money cannot be recovered from the
recipient and (2) the accountable officer is without fault but the
passage of time (see section 8.7) has precluded the granting of
relief. Once an account has been closed in accordance with 31 U.S.C.
1552(a) or 1555, adjustments to it are no longer possible.
[End of Chapter 8]
Appendix I: Standard And Optional Forms:
Table of Contents:
A. Responsibilities for Prescribing Standard Accounting Forms:
B. Selected Standard and Optional Forms Relating to Fiscal Procedures
Prescribed by the Department of the Treasury:
C. Selected Standard and Optional Forms Relating to Fiscal Procedures
Prescribed by the General Services Administration:
D. Optional Forms Relating to Fiscal Procedures Prescribed by the
General Accounting Office:
[End of Table of Contents]
A. Responsibilities for Prescribing Standard Accounting Forms:
Generally, standard and optional accounting forms relating to fiscal
operations and related guidance are prescribed by the agency having
primary functional responsibility for the area(s) associated with the
forms. Except as provided otherwise in this appendix, the issuance or
revision of such forms does not require GAO approval; however, the
forms must be consistent with federal accounting principles and
standards and related requirements prescribed by the Comptroller
General (31 U.S.C. 3511).
The government's Standard and Optional Forms Program is administered
by GSA. The Federal Information Resource Management Regulations
(FIRMR) (41 C.F.R. 201-45.5) sets forth the program's scope,
objectives, guidelines, and procedures. These regulations prescribe
general requirements and procedures for standard and optional forms
management--especially in the areas of clearance, revision,
cancellation, and exceptions. (The standard and optional forms
promulgated by the Comptroller General or those subject to his
approval are excluded from the clearance authorities of the program.
However, by agreement between GSA and GAO, such forms are included in
the GSA clearance procedures discussed in FIRMR.)
All agencies are encouraged to take advantage of opportunities
presented by modern technology, such as use of computer-generated
forms; however, proposed new issuances or revisions of standard forms,
including changes in content, format, or printing specifications, must
be submitted to GSA for review and approval prior to implementation.
B. Selected Standard and Optional Forms Relating to Fiscal Procedures
Prescribed by the Department of the Treasury:
SF 224: Statement of Transactions
SF 1034: Public Voucher for Purchases and Services Other Than Personal
(original):
SF 1034-A: Public Voucher for Purchases and Services Other Than
Personal (memorandum):
SF 1035: Public Voucher for Purchases and Services Other Than
Personal--Continuation Sheet (original):
SF 1035-A: Public Voucher for Purchases and Services Other Than
Personal--Continuation Sheet (memorandum):
SF 1047: Public Voucher for Refunds (original):
SF 1048: Public Voucher for Refunds (memorandum):
SF 1049: Public Voucher for Refunds (original--tabular form):
SF 1050: Public Voucher for Refunds (memorandum--tabular form):
SF 1080: Voucher for Transfers Between Appropriations and/or Funds:
SF 1081: Voucher and Schedule of Withdrawals and Credits:
SF 1096: Schedule of Voucher Deductions:
SF 1098: Schedule of Canceled or Undelivered Checks:
SF 1143: Advertising Order (face); Public Voucher for Advertising
(reverse):
SF 1145: Voucher for Payment Under Federal Tort Claims Act (original)
SF 1145-A: Voucher for Payment Under Federal Tort Claims Act
(memorandum):
SF 1147: Request for Issuance of Replacement Check Due to Error in
Name and/or Designation of Payee
SF 1149: Statement of Designated Depositary Account:
SF 1151: Nonexpenditure Transfer Authorization:
SF 1156: Public Voucher for Fees and Mileage of Witnesses (original):
SF 1156-A: Public Voucher for Fees and Mileage of Witnesses
(memorandum):
SF 1157: Claim for Witness Attendance Fees, Travel, and Miscellaneous
Expense:
SF 1165: Receipt for Cash--Subvoucher (with stub: Interim Receipt for
Cash):
SF 1166 OCR: Voucher and Schedule of Payments (original):
SF 1166-A OCR: Voucher and Schedule of Payments (memorandum):
SF 1167 OCR: Voucher and Schedule of Payments--Continuation Sheet
(original):
SF 1167-A OCR: Voucher and Schedule of Payments--Continuation Sheet
(memorandum):
SF 1179: Recapitulation of Block Control Level Totals of Checks Issued:
SF 1184: Unavailable Check Cancellation:
SF 1218: Statement of Accountability (Foreign Service Account)[A]:
SF 1219: Statement of Accountability[A]:
SF 1220: Statement of Transactions According to Appropriations, Funds,
and Receipt Accounts[A]:
SF 1221: Statement of Transactions According to Appropriations, Funds,
and Receipt Accounts (Foreign Service Account)[A]:
OF 1129: Cashier Reimbursement Voucher and/or Accountability Report:
OF 1129-A: Cashier Reimbursement Voucher and/or Accountability Report--
Memorandum:
[A] This form is used by the Comptroller General for the settlement of
accounts. Changes to and revisions of this form require approval of
the Comptroller General.
C. Selected Standard and Optional Forms Relating to Fiscal Procedures
Prescribed by the General Services Administration:
SF 1012: Travel Voucher (original):
SF 1012-A: Travel Voucher (memorandum):
SF 1038: Advance of Funds Application and Account:
SF 1094: U.S. Tax Exemption Certificate:
SF 1094-A: Tax Exemption Certificates Accountability Record:
SF 1164: Claim for Reimbursement for Expenditures on Official Business:
OF 1121: Bill of Lading Accountability Record:
D. Optional Forms Relating to Fiscal Procedures Prescribed by the
General Accounting Office:
OF 1017-G: Journal Voucher
Because of the low level of demand for all of the optional forms
formerly prescribed by the General Accounting Office and listed in the
appendix to this title, none of the forms will be stocked by the
Federal Supply Service after present stocks are exhausted. Agencies
affected by this change should assess their needs and establish
appropriate alternative forms and procedures. Agencies may meet their
needs for OF 1017-G, Journal Voucher, by reproducing the copy of the
form included on the next, unnumbered page.
The following governmentwide optional forms are canceled.
OF 1014: General Ledger (ruled):
OF 1014-A: General Ledger (unruled):
OF 1015: Allotment Ledger (ruled):
OF 1016: Distribution Ledger (ruled):
OF 1017-C: Register of Allotment Ledger Transactions:
OF 1101: Miscellaneous Obligation record:
OF 1114: Bill for Collection:
OF 1114-A: Official Receipt:
OF 1114-B: Collection Voucher:
OF 1120: Transportation Request Accountability Record:
Journal Voucher:
J. V. No.:
Date:
Reference:
Explanation:
Debit:
Credit:
Total:
Prepared by (Signature):
Title:
Approved by (Signature):
Title:
[End of Appendix I]
Appendix II: Treasury Department-General Accounting Office Joint
Regulations:
Table of Contents:
Number: 1:
Procedure for Handling Repayments to Appropriations:
Number: 2:
Procedure for Making Appropriated Funds Available for Disbursement:
Number: 3:
Procedure for Handling Special, Trust, Revolving and Deposit Fund
Collections:
Amendment No. 1 - Amendment of the Definitions of Available and
Unavailable Receipts:
Amendment No. 2 - Amendment of the Definitions of Available and
Unavailable Receipts:
Amendment No. 3 - Amendment of the Definition of Available Receipts:
Number: 4:
Modification of Warrant Procedures and Revised Elimination of Certain
Checking Accounts:
Supplement No. 1 - Modification of Warrant Procedures and Elimination
of Certain Checking Accounts:
Supplement No. 2 - Modification of Warrant Procedures and Elimination
of Remaining Funded Checking Accounts:
Number: 5:
Elimination of the Requirement That Certain Warrants Be Countersigned
in the General Accounting Office:
Number: 6:
Modification of Procedures for Warrants Issued Pursuant to Continuing
Resolutions:
Elimination of the Requirement that Appropriation Warrants be
Countersigned in the General Accounting Office:
[End of Table of Contents]
Treasury Department - General Accounting Office:
Joint Regulation No. 1:
(Under Public Law 784, approved September 12, 1950):
Subject: Procedure for Handling Repayments to Appropriations.
1. Purpose. Pursuant to Section 115(a) of Public Law No. 784, the
Secretary of the Treasury and the Comptroller General have determined,
in the interest of simplification and improvement, that existing
procedures with respect to the handling of repayments to
appropriations be modified. All collections representing repayments to
appropriations which have not lapsed, including reimbursements and
refunds, will be deposited directly in the accounts of disbursing
officers and will accordingly be immediately available for
disbursement. This will eliminate the necessity for the issuance of
covering warrants, the requisitioning of funds, and the use of
accountable warrants in connection with repayments to appropriations.
The procedure outlined hereinafter will be followed for repayments to
appropriations received from sources outside the Government.
2. Types of Repayments to Appropriations. Repayments to appropriations
covered by the instructions in this Regulation fall within two general
classes defined as follows:
a. Reimbursements to appropriations which represent amounts collected
from outside sources for commodities or services furnished, or to be
furnished, and which by law may be credited directly to appropriations.
b. Refunds to appropriations which represent amounts collected from
outside sources for payments made in error, overpayments, or
adjustments for previous amounts disbursed, including returns of
authorized advances.
3. Accounting for Repayments to Appropriations. The repayments
referred to in paragraph 2 of this Regulation will be scheduled for
credit in the account of a disbursing officer on approved forms, and
will be deposited on Treasury Certificate of Deposit Form No. 6599.
Such repayments may be scheduled to any disbursing officer for deposit
by him to the credit of his own account or to the credit of any other
disbursing officer's account as designated by the administrative
agency. The receipted copy of the schedule of collections showing the
certificate of deposit number and date of deposit shall constitute
acceptable posting media for use by the administrative agency in
crediting such repayments in their accounts.
4. Reporting of Repayment Transactions on Account Current. Disbursing
officers will report such repayments to appropriations in the
collection column of the receipt section of the account current for
each appropriation account.
5. Special Procedures Already Established. This Regulation will not
apply to the accounting for repayments to appropriations through the
Accounts of Advances for the Department of Defense and the Department
of State. The existing procedure prescribed for these agencies where
collections are effected through accounts of advances will be
continued.
The procedure for handling repayments to appropriations as outlined in
General Accounting Office Accounting Systems Memorandum No. 9 -
Revised will continue to be followed where the credits result from
charges to other appropriations.
Also, this Regulation will not apply to the accounting for repayments
to the appropriations available for the payment of the principal of
and interest on the public debt so long as there continues in effect
the present procedure under which such payments are made.
6. Effective Date. The procedures outlined in this Regulation are to
be effective November I, 1950.
(Signed) John W. Snyder:
Secretary of the Treasury:
(Signed) Lindsay C. Warren:
Comptroller General of the United States:
September 22, 1950:
[End of Joint Regulation 1]
Treasury Department - General Accounting Office:
Joint Regulation No. 2:
(Under Public Law 784, approved September 12, 1950):
Subject: Procedure for Making Appropriated Funds Available for
Disbursement.
1. Purpose. Pursuant to Section 115(a) of Public Law 784, the
Secretary of the Treasury and the Comptroller General have determined
in the interest of simplification and improvement, that existing
procedures with respect to the requisitioning of appropriated funds by
agencies and the advancing of such funds to disbursing officers shall
be modified as provided herein. Appropriated funds will be advanced
under each separate appropriation head to disbursing officers on the
basis of properly executed appropriation warrants except as indicated
in paragraph 4 hereof. This will eliminate the requisitioning of funds
and the issuance of accountable warrants in connection with funds made
available to agencies on appropriation warrants and will result in the
discontinuance of certain accounts on the books of the agencies and
the Treasury Department.
2. Method of Advancing Agency Funds to Disbursing Officers. Funds
appropriated to agencies will, on the basis of appropriation warrants
issued and countersigned, be made immediately available in the
checking accounts of appropriate disbursing officers on the books of
the Treasurer of the United States. Such funds will be made available
by appropriation account as follows:
a. Agency Funds Advanced to the Chief Disbursing Officer, Treasury
Department. Appropriated funds of agencies to be disbursed or funded
by the Division of Disbursement will be made available in the accounts
of the Chief Disbursing Officer. Funds will be transferred by the
Chief Disbursing Officer to other disbursing officers, authorized to
obtain advances through his account, on the basis of requests received
from administrative agencies concerned.
b. Agency Funds Advanced to Disbursing Officers Other Than the Chief
Disbursing Officer, Treasury Department. Appropriated funds of other
agencies will be made available in the accounts of the disbursing
officer of the agency. Where an agency has more than one disbursing
officer, the agency will designate the officer whose account with the
Treasurer of the United States is to be credited with the total amount
of appropriated funds available to the agency and notify the Treasury
Department and the General Accounting Office of such designation. The
disbursing officer designated will make such transfers of funds to
other disbursing officers, authorized to obtain advances through his
account, as necessary for purposes of the agency.
3. Conditions Under Which Advances of Funds May be Withheld or
Withdrawn. In the event of delinquency in the rendition of accounts or
for other reasons involving the condition of the disbursing officer's
account, within the purview of 31 U.S.C. 78, advances to such officer
may be withheld or withdrawn, and in the case of such withholding an
appropriation warrant may be issued without authorizing an advance.
4. Appropriated Funds Exempted from This Regulation. This Regulation
will not apply to the following appropriated funds: (1) those in which
the unrequisitioned balance is a factor in the computation of interest
to be charged or credited; (2) those for the payment of principal and
interest on the public debt; (3) those appropriations which are
available only for transfer, in the full amount, to some other account
on the books of the Treasury; and (4) District of Columbia funds.
5. Effective Date. This Regulation will become effective May 1, 1951.
Any unrequisitioned balances of appropriations not exempted by this
Regulation remaining on the books of the Treasury as of the close of
business April 30, 1951, less the reserves established by the Bureau
of the Budget pursuant to Section 1214 of the General Appropriation
Act, 1951, approved September 6, 1950, Public Law 759, 81st Congress,
will be advanced by the Secretary of the Treasury to the appropriate
disbursing officer.
(Signed) John W. Snyder:
Secretary of the Treasury:
(Signed) Lindsay C. Warren:
Comptroller General of the United States:
April 16, 1951:
[End of Joint Regulation 2]
Treasury Department - General Accounting Office:
Joint Regulation No. 3:
(Under Public Law 784, approved September 12, 1950):
Subject: Procedure for Handling Special, Trust, Revolving and Deposit
Fund Collections:
1. General Provisions. Pursuant to Section 115(a) of Public Law 784,
the Secretary of the Treasury and the Comptroller General of the
United States have determined that existing procedures with respect to
the handling of special fund and trust fund receipts which are
available for expenditure by the collecting agency, be modified.
Except as otherwise provided herein, all such special fund and trust
fund receipts will be credited directly in the accounts of disbursing
officers and will accordingly be immediately available for
disbursement. The issuance of covering warrants and the advancing of
funds to disbursing officers in connection with such receipts is
hereby eliminated; however, these collections will continue to be
accounted for as receipts and as amounts appropriated. The Treasury
Department will issue appropriation warrants on an annual basis to be
countersigned by the Comptroller General confirming the appropriation
of such receipts.
The Secretary of the Treasury and the Comptroller General of the
United States have determined that covering warrants will be
eliminated in connection with certain special fund and trust fund
accounts which are in the nature of revolving fund or deposit fund
accounts. Collections for credit to accounts of this nature will be
credited directly to revolving fund or deposit fund accounts instead
of to receipt accounts. Such collections will be accounted for in the
same manner as repayments to general, special or trust fund
appropriations in accordance with the procedures set forth in Treasury
Department - General Accounting Office Joint Regulation No. 1.
2. Types of Special Fund and Trust Fund Receipts. Appropriation
receipts relating to special and trust fund accounts fall within two
general classes described below:
a. Available receipts. Receipts which under law or trust agreement are
immediately available in their entirety to the collecting agency as
appropriations for expenditure without further action by the Congress.
Excluded from this category are receipts to be applied to the
retirement of Public Debt obligations and funds in connection with
which the computation of interest charges or credits necessitates the
maintenance of accounts for unrequisitioned balances of appropriations
on the books of the Treasury.
b. Unavailable receipts. Receipts which at the time of collection are
not appropriated, and receipts which are not immediately available for
expenditure because (I) further action by the Congress is required or
congressional limitation has been established as to the amount
available for expenditure; (2) amounts credited to receipt
accounts are later to be cleared in whole or in part to other receipt
accounts before appropriation warrant action is taken; or (3) the
amounts of receipts are appropriated, made available to an agency
other than the one making collection.
3. Accounting for Special Fund and Trust Fund Receipts. All receipts
for credit to accounts classified as special funds and trust funds
will be accounted for by agencies on a gross basis under receipt
account symbols assigned by the Treasury Department. Available
receipts will concurrently be accounted for in related special fund or
trust fund appropriation account.
The available receipts described in paragraph 2a will be scheduled for
credit in the account of a disbursing officer on a special form to be
prescribed by the General Accounting Office. Such receipts when
credited in the accounts of a disbursing officer will be available for
disbursement.
The unavailable receipts described in paragraph 2b and the items
excluded in paragraph 2a are not affected by this Regulation.
4. Designation of Types of Receipts by Treasury Department. The
Treasury Department will assign receipt account symbols for special
fund accounts and trust fund accounts. Announcements will designate
those receipts which are to be treated as available. Agencies will be
guided accordingly in scheduling collections to disbursing officers.
5. Conditions Under which Credits to a Disbursing Officer May Be
Withheld or Balances to his Credit May Be Withdrawn. In the event of
delinquency in the rendition of accounts or for other reasons
involving the condition of the disbursing officer's account, within
the purview of 31 U.S.C. 78, credits to such officer may be withheld
and balances already to his credit may be withdrawn irrespective of
the source of such credits or balances.
6. Effective Date. This Regulation will be effective July 1, 1951.
(Signed) John W. Snyder:
Secretary of the Treasury:
(Signed) Lindsay C. Warren:
Comptroller General of the United States:
June 12, 1951:
[End of Joint Regulation 3]
Treasury Department - General Accounting Office:
Joint Regulation No. 3, Amendment No. 1:
(Under Public Law 784, approved September 12, 1950)L
Subject: Amendment of the Definitions of Available and Unavailable
Receipts.
The Secretary of the Treasury and the Comptroller General of the
United States have determined that the definition of available and
unavailable receipts set forth in Joint Regulation No. 3, dated June
12, 1951, be modified by eliminating the provision that available
receipts be collected in their entirety by the agency to which they
are available as appropriations for expenditure.
Accordingly, the phrase "by the collecting agency" in paragraph 1 of
the Regulation is hereby deleted, and paragraph 2 is amended to read
as follows:
2. Types of Special Fund and Trust Fund Receipts. Appropriation
receipts relating to special and trust fund accounts fall within two
general classes described below:
a. Available Receipts. Receipts which under law or trust agreement are
immediately available in their entirety as appropriations to a single
agency for expenditure without further action by the Congress.
Excluded from this category are receipts to be applied to the
retirement of Public Debt obligations and funds in connection with
which the computation of interest charges or credits necessitates the
maintenance of accounts for unrequisitioned balances of appropriations
on the books of the Treasury.
b. Unavailable Receipts. Receipts which at the time of collection are
not appropriated, and receipts which are not immediately available for
expenditure because (1) further action by the Congress is required or
congressional limitation has been established as to the amount
available for expenditure; or (2) amounts credited to receipt accounts
are later to be cleared in whole or in part to other receipt accounts
before appropriation warrant action is taken.
The second sub-paragraph of paragraph 3 of the Regulation is amended
to read as follows:
The available receipts described in paragraph 2 will be scheduled for
credit in the account of a disbursing officer on such forms as may be
prescribed by the General Accounting Office. Such receipts when
credited in the accounts of a disbursing officer will be available for
disbursement.
With respect to the Civil Service Retirement and Disability Fund, this
amendment will apply only to those deductions from payrolls paid by
the Division of Disbursement, Treasury Department, which heretofore
have been covered into the Treasury with credit to the receipt account
"Contributions, civil service retirement and disability fund". As soon
as appropriate procedures are developed for the handling as available
receipts of the receipts herein excluded, Joint Regulation No. 3 will
be amended accordingly.
(Signed) John W. Snyder:
Secretary of the Treasury:
(Signed) Lindsay C. Warren:
Comptroller General of the United States:
December 21, 1951:
[End of Joint Regulation 3, Amendment 1]
Treasury Department - General Accounting Office:
Joint Regulation No. 3:
Amendment No. 2:
Subject: Amendment of the Definitions of Available and Unavailable
Receipts:
Amendment No. 1, dated December 21, 1951, to Joint Regulation No. 3 is
hereby amended by deleting the last unnumbered paragraph thereof
concerning transactions of the Civil Service Retirement and Disability
Fund, since procedures have now been developed for the handling of all
receipt transactions of the Fund as available receipts under Joint
Regulation No. 1 This amendment will be effective July 1, 1957.
(Signed) W. Randolph Burgess:
Acting Secretary of the Treasury:
(Signed) Joseph Campbell:
Comptroller General of the United States:
May 20, 1957:
[End of Joint Regulation 3, Amendment No. 2]
Treasury Department - General Accounting Office:
Joint Regulation No. 3:
Amendment No. 3:
Subject: Amendment of the Definition of Available Receipts:
The Secretary of the Treasury and the Comptroller General of the
United States have determined that the definition of available
receipts set forth in Joint Regulation No. 3, dated June 12, 1951, as
amended by Amendment No. 1, dated December 21, 1951, be modified by
eliminating the exclusion from that definition of funds in connection
with which the computation of interest charges or credits necessitates
the maintenance of accounts of unrequisitioned balances of
appropriations on the books of the Treasury.
Accordingly, the phrase "and funds in connection with which the
computation of interest charges or credits necessitates the
maintenance of accounts for unrequisitioned balances of appropriations
on the books of the Treasury" in paragraph 2a is deleted. The amended
definition of available receipts reads as follows:
2. Types of Special Fund and Trust Fund Receipts. * * *
a. Available Receipts. Receipts which under law or trust agreement are
immediately available in their entirety as appropriations to a single
agency for expenditure without further action by the Congress.
Excluded from this category are receipts to be applied to the
retirement of Public Debt obligations.
This amendment will be effective July 1, 1972.
/Signed/ John K. Carlock:
Fiscal Assistant Secretary of the Treasury:
/Signed/ Elmer B. Staats:
Comptroller General of the United States:
September 18, 1972:
[End of Joint Regulation 3, Amendment No. 3]
Treasury Department - General Accounting Office:
Joint Regulation No. 4 - Revised:
(Under Public Law 784, approved September 12, 1950):
Subject: Modification of Warrant Procedures and Elimination of Certain
Checking Accounts:
1. Pursuant to Section 115 of the Budget and Accounting Procedures Act
of 1950 (31 U.S.C. 66c), the Secretary of the Treasury and the
Comptroller General of the United States have made the following
determinations in consideration of: (a) Sections 113 and 114 of the
Budget and Accounting Procedures Act of 1950 which, respectively,
place responsibility on the head of each executive agency for
maintaining systems of accounting and internal control in accordance
with certain requirements, and make provision for maintaining in the
Treasury Department a unified system of central accounting and
reporting on the most efficient and useful basis; (b) Section 3679 of
the Revised Statutes, as amended (31 U.S.C. 665), which requires the
head of each executive agency to maintain a system for administrative
control over the incurring of obligations and making of expenditures
pursuant to appropriations or other authorizations and the fixing of
responsibilities for violations of law in that respect; (c) where
applicable, the Act of December 29, 1941, as amended (31 U.S.C. 82b -
c) fixing the respective responsibilities of disbursing and certifying
officers; and (d) the detailed reconciliation which is made of
disbursing and collecting officers' check and deposit transactions.
2. The requirements of existing law that funds be requisitioned and
advanced to accountable officers are hereby waived.
3. The responsibility for determining, prior to disbursement, the
sufficiency of balances under appropriations, funds or other
limitations established by or pursuant to law rests with the
administrative agency to which the funds were appropriated or
otherwise made available. There is no change in the responsibilities
of officers performing disbursing functions exempted from the
provision of the Act of December 29, 1941, as amended.
4. The use of funded checking accounts in the issuance and payment of
checks drawn on the Treasurer of the United States shall be
discontinued, with respect to designated agencies. In each case where
a funded checking account is not maintained, the balance of checks
outstanding, supported by the checks issued records of disbursing
officers and paid check records of the Treasurer, shall be the basis
for the reconciliation of the disbursing accounts. The amount of
checks outstanding for each such disbursing symbol account shall be
disclosed by the accounts of the Treasury Department relating to the
cash operations of the Government as a whole, maintained pursuant to
Section 114 of the Budget and Accounting Procedures Act of 1950.
5. In the event of delinquency by a disbursing officer in the
rendition of his accounts or for other reasons arising out of the
condition of the officer's accounts, the Comptroller General may, by
notification to the Secretary of the Treasury, suspend the terms of
paragraph 2 of this Joint Regulation with respect to such officer. In
such event the applicable provisions of law will become operative with
respect to such officer.
6. The requirements of existing law that warrants be issued and
countersigned to acknowledge the receipt of moneys to be covered in
the Treasury are hereby waived. For the purposes of Section 305 of the
Revised Statutes, as amended (31 U.S.C. 147), moneys received and
covered into the public Treasury shall be deemed to be officially
acknowledged when the receipt of such moneys, for credit to the
receipt accounts or appropriation and fund accounts maintained
pursuant to the Act of July 31, 1894, as amended (5 U.S.C. 255) and
Section 114(b) of the Budget and Accounting Procedures Act of 1950, is
recorded by the Treasury offices designated for that purpose by the
Secretary of the Treasury.
7. This regulation is effective July 1, 1955. The provisions of
paragraph 4, however, shall become operative with respect to only the
disbursing activities designated below, on the date cited. Further
authorizations will be made by supplement to this regulation.
Disbursing Activity: a. Disbursing by all components of the Department
of Defense;
Effective Date: July 1, 1955
Disbursing Activity: b. All disbursing by the Division of
Disbursement, Treasury Department, including disbursing by others by
delegation under the provisions of section 4 of Executive Order No.
6166, as amended, and disbursing by the Division of Disbursement for
officers or agencies not subject to the provisions of such section,
including checks drawn in the name of the Secretary of the Treasury;
Effective Date: July 1, 1955.
Disbursing Activity: c. All disbursing by United States Marshals;
Effective Date: July 1, 1955.
Disbursing Activity: d. All disbursing by the Judiciary, except Clerks
of United States District Courts, Clerks of United States Courts of
Appeals, Clerks of United States Emergency Court of Appeals, and
Register of Wills;
Effective Date: July 1, 1955.
(Signed) G. M. Humphrey:
Secretary of the Treasury:
(Signed) Joseph Campbell:
Comptroller General of the United States:
April 29, 1955:
[End of Joint Regulation No. 4 - Revised]
Treasury Department - General Accounting Office:
Joint Regulation No. 4 - Revised, Supplement No. 1:
(Under Public Law 784, approved September 12, 1950):
Subject: Modification of Warrant Procedures and Elimination of Certain
Checking Accounts:
As contemplated by paragraph 7 of Joint Regulation No. 4 - Revised,
dated April 29, 1955, the Secretary of the Treasury and Comptroller
General of the United States have determined that the provisions of
paragraph 4 of said regulation, concerning the elimination of funded
checking accounts for the issuance and payment of checks drawn on the
Treasurer of the United States, shall become operative, not later than
July 1, 1957, with respect to the additional disbursing activities
designated below.
1. Post Office Department, exclusive of the separate accounts
maintained under the postal savings system.
2. Library of Congress.
3. Government Printing Office.
(Signed) W. Randolph Burgess:
Acting Secretary of the Treasury:
(Signed) Joseph Campbell:
Comptroller General of the United States:
January 10, 1957:
[End of Joint Regulation No. 4 - Revised, Supplement No. 1]
Department Of The Treasury - General Accounting Office:
Joint Regulation No. 4 - Revised, Supplement No. 2:
(Under Public Law 784, approved September 12, 1950):
Subject: Modification of Warrant Procedures and Elimination of
Remaining Funded Checking Accounts:
As contemplated by paragraph 7 of Joint Regulation No. 4 - Revised,
dated April 29, 1955, the Secretary of the Treasury and Comptroller
General of the United States have determined that the provisions of
paragraph 4 of said regulation, concerning the elimination of funded
checking accounts for the issuance and payment of checks drawn on the
United States Treasury, shall become operative, not later than July 1,
1975, with respect to all disbursing activities.
/Signed/ John K. Carlock:
Fiscal Assistant Secretary of the Treasury:
/Signed/ Elmer B. Staats:
Comptroller General of the United States:
June 26, 1975:
[End of Joint Regulation No. 4 - Revised, Supplement No. 2]
Department Of The Treasury - General Accounting Office:
Joint Regulation No. 5:
(Under Public Law 784, approved September 12, 1950):
Subject: Elimination of the Requirement That Certain Warrants Be
Countersigned in the General Accounting Office:
1. Section 115 of the Budget and Accounting Procedures Act of 1950 (31
U.S.C. 66c) provides that when the Secretary of the Treasury and the
Comptroller General of the United States determine that existing
procedures can be modified in the interest of simplification,
improvement, or economy, with sufficient safeguards over the control
and accounting for public funds, they may issue joint regulations
providing for the waiving, in whole or in part, of the requirements of
existing law that warrants be issued and countersigned in connection
with the receipt, retention, and disbursement of public moneys and
trust funds.
2. Pursuant to the above statute, the Secretary of the Treasury and
the Comptroller General of the United States have determined, in the
interest of simplification and improvement, that existing procedures
with respect to the processing of appropriation warrants be modified
to eliminate the requirement that such warrants be countersigned in
the General Accounting Office except for those warrants issued
pursuant to legislation continuing appropriations until enactment of
applicable appropriation acts.
3. All requirements of existing law that warrants be countersigned are
hereby waived except as they relate to countersigning of warrants
issued pursuant to legislation continuing appropriations until
enactment of applicable appropriation acts.
4. Documentation for amounts appropriated will be prepared in
accordance with Department of the Treasury Regulations.
5. The Department of the Treasury will continue to consult with the
General Accounting Office before issuance of warrants when the
legality of issuance and/or the amount requested are in question.
6. Effective Date. This regulation will be effective upon issuance of
appropriate regulations by the Department of the Treasury.
/Signed/ John K. Carlock:
Fiscal Assistant Secretary of the Treasury:
/Signed/ Elmer B. Staats:
Comptroller General of the United States:
October 18, 1974:
[End of Joint Regulation No. 5]
Department Of The Treasury - General Accounting Office:
Joint Regulation No. 6:
(Under Public Law 784, approved September 12, 1950):
Subject: Modification of Procedures for Warrants Issued Pursuant to
Continuing Resolutions:
1. Section 115 of the Budget and Accounting Procedures Act of 1950 (31
USC 3326) provides that when the Secretary of the Treasury and the
Comptroller General of the United States determine that existing
procedures can be modified in the interest of simplification,
improvement, or economy, with sufficient safeguards over the control
and accounting for public funds, they may issue joint regulations
providing for the waiving, in whole or in part, of the requirements of
existing law pertaining to warrants issued and countersigned in
connection with the receipt, retention, and disbursement of public
monies and trust funds.
2. Pursuant to the above statute, the Secretary of the Treasury and
the Comptroller General of the United States have determined, in the
interest of simplification, improvement, and economy, that existing
procedures with respect to appropriation warrants issued under
continuing resolutions be modified to eliminate the requirement that
new appropriation warrants be issued and countersigned upon the
enactment of each and every continuing resolution during a fiscal year.
3. All appropriation warrants under the first continuing resolution
for a fiscal year will be issued and countersigned for an amount
equivalent to the total annual amount appropriated by the resolution.
Additional warrants will be issued and countersigned only if
subsequent continuing resolutions change the annual amount
appropriated for an account.
4. The Department of the Treasury will continue to consult with the
General Accounting Office before issuance of warrants when the
legality of issuance and/or the amount requested are in question.
5. Effective Date. This regulation will be effective October 1, 1983.
/Signed/ Gerald Murphy:
Acting Fiscal Assistant Secretary of the Treasury:
/Signed/ Charles A. Bowsher
Comptroller General of the United States:
[End of Joint Regulation No. 6]
Department Of The Treasury - General Accounting Office:
Joint Regulation No. 7:
(Under Public Law 784, approved September 12, 1950):
Subject: Elimination of the Requirement that Appropriation Warrants be
Countersigned in the General Accounting Office:
1. Section 115 of the Budget and Accounting Procedures Act of 1950 (31
U.S.C. 3326) provides that when the Secretary of the Treasury and the
Comptroller General of the United States determine that existing
procedures can be modified in the interest of simplification,
improvement, or economy, with sufficient safeguards over the control
and accounting for public funds, they may issue joint regulations
providing for the waiving, in whole or in part, of the requirements of
existing law pertaining to, warrants issued and countersigned in
connection with the receipt, retention, and disbursement of public
moneys and trust funds.
2. Pursuant to the above statute, the Secretary of the Treasury and
the Comptroller General of the United States have determined, in the
interest of simplification, improvement, and economy that existing
procedures with respect to appropriation warrants issued under
continuing resolutions be modified to eliminate the requirement that
these warrants be countersigned in the General Accounting Office.
3. All requirements of existing law that appropriation warrants issued
under continuing resolutions be countersigned are hereby waived.
4. The Department of the Treasury will continue to consult with the
General Accounting Office before issuance of warrants when the
legality of issuance and/or the amount requested are in question.
5. Effective Date. This regulation will be effective January 1, 1991.
/Signed/ Gerald Murphy:
Acting Fiscal Assistant Secretary of the Treasury:
/Signed/ Charles A. Bowsher
Comptroller General of the United States:
[End of Joint Regulation No. 7]
[End of Appendix II]
Appendix III: Use Of Statistical Sampling Procedures In Examination Of
Vouchers For Payment:
Table of Contents:
A. Definition:
B. Statutory Authority and Exceptions:
C. Appropriateness of Statistical Sampling:
D. The Sampling Plan:
E. Documentation:
[End of table of contents]
A. Definition:
Statistical (or probability) sampling in voucher examination relies on
the scientifically proven principles of probability to collect
quantitative facts about the accuracy and other characteristics of a
universe of vouchers by reviewing a statistically selected sample of
that universe. Examination of the items in the sample and evaluation
of the results not only permit the correction of errors and other
deficiencies found in the items sampled and in procedures and controls
directly related to them but also permit mathematical projections as
to the quality of all vouchers in the universe. The results of such
sampling can be the basis for making changes in procedures or controls
in order to correct deficiencies in the voucher processing system.
Analysis of the sample results also provides the input needed to
confirm the continuing validity of the sampling plan or, when
appropriate, to modify the plan.
The term "examination" means the review, prior to payment, of
documents assembled in support of any claim against, or any payment to
be made by, the government, to determine its legality, propriety,
validity, and accuracy.
B. Statutory Authority and Exceptions:
Agency heads are authorized by 31 U.S.C. 3521(b) to establish
statistical sampling programs, within limitations prescribed by the
Comptroller General, for the examination of vouchers in support of
their certification and payment. In accordance with this authority,
the Comptroller General has established a general limitation of $2,500
on vouchers that may be examined by sampling programs. (In determining
whether travel vouchers exceed the limitation, agencies may exclude
any passenger transportation costs paid through the General Services
Administration's contractor-issued charge cards.) Agencies are
required to establish their own dollar limitations within this maximum
based on cost-benefit analyses of their voucher examining operations.
The law (section 3521(c)) also provides that disbursing or certifying
officials who rely in good faith on the statistical sampling
procedures adopted by their agency to disburse funds or certify a
voucher for payment will not be liable for losses to the government
resulting from payment or certification of a voucher not audited
specifically because of the use of the sampling procedure, provided
that the agency has diligently carried out collection actions
prescribed by the Comptroller General.
Also, sampling may be used in the examination of single vouchers
totaling more than the agency established limitation, as provided in
this appendix, if they comprise numerous similar transactions less
than the agency's dollar limitation. For example, supporting
documents, such as copies of delivery tickets or petty cash receipts,
may be examined by sampling if savings can be realized.
Exceptions to the $2,500 maximum for vouchers which may be
statistically sampled may be authorized when it is clear that they are
warranted economically and that the procedures and controls in place
will adequately protect the government's interest. Plans covering such
exceptions require justification and approval on a case-by-case basis.
Requests for exceptions should include (1) the proposed sampling plan
and (2) a cost benefit analysis, including the cost of errors not
detected, both in sufficient detail for meaningful evaluation of the
proposal. They should be sent to:
Assistant Comptroller General:
Accounting and Information Management Division:
U.S. General Accounting Office:
441 G Street, NW:
Washington, DC 20548:
Statistical sampling can also be an effective tool for monitoring the
overall quality of an agency's voucher processing system or for
evaluating a particular aspect of the processing procedures and
controls. The provisions of 31 U.S.C. 3521(b) and (c) are not
applicable because this type of sampling is not a substitute for the
normal 100-percent, prepayment examination of vouchers. Although
dollar limitations and other regulatory restrictions do not apply to
this type of sampling, agencies should use a scientifically acceptable
sampling plan and procedure so that the sample results are
representative of the voucher universe that is sampled.
C. Appropriateness of Statistical Sampling:
Statistical sampling is a means of reducing the cost of unproductive
voucher examinations and must be supported by appropriate cost
evaluations; however, an unfavorable cost-benefit ratio could be the
result of correctable inefficiencies in the current examining process.
Thus, before concluding that statistical sampling is appropriate,
agencies should consider whether they need to strengthen examining
skills or better utilize available data processing and communication
technology. Also, when statistical sampling is undertaken, its
propriety should be reevaluated periodically in light of technological
or operational changes.
Agencies should seek the combination of voucher examining techniques
that is most efficient and effective. The use of statistical sampling
does not preclude agencies from using computerized edits and other
techniques designed to ensure the accuracy and reasonableness of data
and for improving the efficiency and effectiveness of voucher
examining. For example, agencies should look for ways to improve
examination efficiency and effectiveness by placing emphasis on areas
of potential weakness. In particular, agencies should consider whether
an error that has been detected is likely to be present in other
similar transactions and, if so, whether to take steps to identify and
correct all such errors.
D. The Sampling Plan:
Developing a good statistical sampling plan requires knowledge usually
possessed by professionals in the field of statistics. Accordingly,
the advice and assistance of a professional statistician should be
utilized when setting up a system of statistical sampling. Once
developed and tested in operation, a sampling system may be operated
by personnel not having statistical training. It must be monitored,
however, by persons who have sufficient knowledge of statistical
sampling techniques used for auditing records and of the essential
features the plan in use to assure that it operates as designed.
Improvements are to be made when needed.
A determination to employ statistical sampling should be supported by
a comparison of the cost to carry out the alternative voucher
examination procedures to the benefits resulting from the examination.
As appropriate, vouchers should be categorized by type and dollar
range to make these comparisons effective in identifying the dollar
thresholds below which savings would result from statistical sampling.
The measure of such savings would be the difference between (1) the
cost of examining all vouchers and (2) the combined costs of (a)
examining the sample and (b) projected losses due to undetected errors
in the vouchers not examined. Dollar thresholds are likely to vary
among and within agencies according to the complexity of the vouchers
that are being processed and the effectiveness of processing
procedures and controls in use.
Using statistical sampling for voucher examination involves
identifying objectives and scientifically acceptable approaches for
the design, implementation, and subsequent revision of a formal
sampling plan. In order to develop and implement the plan and to
monitor its operation, agencies will generally have to do the
following.
1. Define the universe of vouchers to be examined by statistical
sampling, including the time period for the sample (e.g., a week, a
month, etc.). Usually, this will be a determination to sample certain
categories and dollar ranges (strata), based on an analysis, as
described above, that identifies the threshold below which sampling is
more cost-effective than the normal voucher examination.
2. Determine the size of the sample needed and how the sample items
will be selected. Often, the procedure will involve random or
stratified selection of sample items from the stream of vouchers that
is being processed for payment. The plan for statistical sampling
should provide the opportunity for any invoice not subject to normal
examination to be selected in the sample.
3. Analyze the results of the sample using the appropriate statistical
procedure and determine if any changes are needed to the sampling plan
or whether to examine the entire universe. For example, analysis of
sample results might indicate a need to modify the dollar threshold
between the vouchers that are being subjected to 100-percent
examination and those that are being examined by statistical sampling.
4. Present the results to management with appropriate interpretation.
E. Documentation:
The agency must maintain records of all aspects of its sampling
plan(s), including such elements as the specific sampling procedures,
the statistical formulas or tables used, and the resulting
calculations. Further, records of actual application of the plan, such
as, (1) work sheets showing items selected for examination, (2) errors
discovered, (3) total number and amount of vouchers in the universe,
(4) projected error, including possible range of error in the
universe, (5) whether the results were acceptable, and (6) other
pertinent data, should be retained in order to document the
implementation of the plan and any subsequent changes made based on
the sample results. These records, which reflect actual operation of
the plan, should be subject to the same retention-disposal criteria as
other documentation in support of agency disbursements. All records
pertaining to the voucher examination system should be available for
review by management and audit personnel.
[End of Appendix III]
Appendix IV: Special Requirements For Certain Types Of Disbursements:
Table of Contents:
A. Advertising:
B. Contract Field Printing:
C. Long-distance Telephone Service:
D. Payment in Foreign Currency:
E. State and Local Taxes:
F. Tort Claims:
G. Transportation:
H. Travel Advances:
I. Unclaimed Moneys and Funds Erroneously Received:
[End of Table of Contents]
In addition to the requirements set forth in chapter 6, special
requirements have been established by law or regulation for certain
types of disbursements. The various special requirements described in
this appendix generally apply but the actual requirements for
individual agencies may differ.
A. Advertising:
The head of each agency shall maintain appropriate procedures for
authorizing the procurement of and payment for advertising in
accordance with 44 U.S.C. 3702 and 3703 and 5 U.S.C. 302(b).
Delegated authority to authorize advertising may not be redelegated
unless specifically authorized by law.
B. Contract Field Printing:
The responsible officer under whose authority contract field printing
was purchased shall certify that the work was procured in accordance
with the applicable Government Printing and Binding Regulations of the
Congressional Joint Committee on Printing.
C. Long-distance Telephone Service:
Section 1348(b) of 31 U.S. Code provides that:
"Appropriations of an agency are available to pay charges for a long-
distance call if required for official business and the voucher to pay
for the call is sworn to by the head of the agency. Appropriations of
an executive agency are available only if the head of the agency also
certifies that the call is necessary in the interest of the
Government."
Agencies should maintain documentation showing all persons designated
to furnish the certifications required by this statute. This
documentation, as other basic payment documentation, should be
maintained for audit purposes.
Every effort should be made to restrict the use of government
telephones to the transaction of official business. Agencies may pay
the costs of certain personal telephone calls if the calls meet the
criteria established by the General Services Administration. (See 41
C.F.R. part 201.)
The agency head's duty to certify long-distance telephone calls may be
satisfied through implementation of an appropriate statistical
sampling system.
The General Services Administration has developed special payment
verification procedures with respect to the usage-based services under
the FTS2000 system. Under these procedures, GSA is responsible for
ensuring that the contractors comply with contract terms. GSA pays the
contractors from funds advanced by the agencies based on (1) GSA's
limited examination of the charges billed and (2) GSA's reliance on
the systematic verifying and reporting procedures that are required of
the user agencies. In accordance with guidance provided by GSA, the
user agencies must verify the propriety of the reported usage,
including that the calls are necessary in the interest of the
government. They must report regularly to GSA on their verification
efforts and provide GSA with documentation on disputed charges. Also,
agencies are required to take appropriate collection and disciplinary
action against individuals making unofficial calls.
Section 1348 of 31 U.S. Code prohibits payments for telephone
installations in private residences except where otherwise provided
for by law.
D. Payment in Foreign Currency:
All vouchers that are to be paid in foreign currency must show the
appropriation(s) to be charged and either the foreign currency amount
to be paid or the United States dollar equivalent. The disbursing
officer will record the rate of exchange, along with either the
foreign currency amount or United States dollar equivalent as
appropriate. Detailed instructions for preparation of vouchers payable
in foreign currency are contained in the Treasury Financial Manual,
volume I, part 4. If payment is made by a check drawn on a foreign
depositary, the disbursing officer should record the name of the
depositary and the check number on the voucher.
The Office of Management and Budget has requested that all agencies
make a special effort to ensure that contracts and other obligations
are incurred in, and paid for in, foreign currencies rather than U.S.
dollars in countries for which it has been announced that the supply
of foreign currencies available for U.S. programs exceeds immediate
needs.
E. State and Local Taxes:
Agencies of the United States, including government corporations, are
not obligated to pay state or local taxes imposed directly on the
federal government because, under the U.S. Constitution, the federal
government is immune from the payment of such taxes. The government is
exempt from payment of a state or local sales tax when the legal
incidence of the tax is on the vendee or when the state or local law
exempts sales to the United States from such taxation. As it is not
always clear where the legal incidence of a tax falls, a legal opinion
should be obtained if there is any doubt in a specific case.
The policies, procedures, and forms for asserting immunity or
exemption from, or for the payment of, state and local taxes are
promulgated in the Federal Acquisition Regulation.
Generally, agencies should assert the government's immunity or
exemption from taxes whenever it is available. Agencies, however, need
not claim immunity or exemption from taxes unless it is cost-effective
to do so or the vendor will grant a tax exemption without requiring a
tax exemption certificate.
For imprest fund purchases, in the interest of economy and reduced
paperwork, agency heads or their authorized representatives may
authorize the payment of state and local taxes on any transaction
regardless of its dollar value. Before asserting immunity from
such taxes, an agency should consider whether the cost of issuing a
tax exemption certificate (SF 1094) is justified by the probable
savings.
F: Tort Claims:
Section 2672 of 28 U.S. Code provides that the head of each federal
agency or his or her designee, in accordance with regulations
prescribed by the Attorney General, may consider, ascertain, adjust,
determine, compromise, and settle any tort claim for money damages
against the United States, provided that any compromise or settlement
in excess of $25,000 be effected only with the prior written approval
of the Attorney General or designee.
Documentation supporting the compromise or settlement of a tort claim
shall include:
1. a statement setting forth the amount claimed, a full description of
the circumstances that gave rise to the claim and the essential
elements of the claim, and the amount of the compromise or settlement;
2. the written approval by the head of the agency or designee of the
compromise or settlement;
3. the written acceptance from the claimant of the compromise or
settlement; and;
4. the written approval of the Attorney General or designee, if the
amount of the compromise or settlement exceeds $25,000.
Any compromise or settlement in an amount of $2,500 or less shall be
paid by the head of the agency concerned out of appropriations
available to that agency. The amount of the compromise or settlement
should be certified as proper for payment by the authorized certifying
official.
Any compromise or settlement in excess of $2,500, either authorized by
the head of the agency or the Attorney General, shall be paid from
appropriations or funds available for the payment of judgments or
compromises of like cases. All memorandums, reports, exhibits, and
other documents supporting the settlement of a claim shall be retained
by the agency.
G. Transportation:
Requirements relating to payments for transportation services are
contained in Title 5 of this manual and in regulations issued by the
General Services Administration.
H. Travel Advances:
A traveler entitled to a per diem, mileage, or subsistence allowance
may be given a monetary advance in such amount as may be deemed
advisable considering the character and probable duration of the
travel to be performed. As a general rule, agency procedures should
ensure that travel advances are approved only if they are necessary
and are held to a minimum in both duration and amount. A viable
alternative to the use of cash advances is provided by the travel
credit card program established by GSA.
Normally, travel advances are charged to the appropriations or funds
from which the reimbursements for the travel expenses will be made. If
a traveler is in temporary duty travel status spanning 2 fiscal years,
the expenses applicable to each fiscal year must be accounted for in
the year the expenses are incurred.' The records of the accountable
officer must have documentation supporting the respective disbursement
for each fiscal year. However, travel expenses for a permanent change
of duty station are charged against the appropriation current at the
time the travel order is issued, even if the travel spans 2 fiscal
years.
I. Unclaimed Moneys and Funds Erroneously Received:
Payments of moneys erroneously received and deposited into the
Treasury and of unclaimed moneys will be made by Treasury in
accordance with the procedures in the Treasury Financial Manual,
volume I, part 6.
These payments may be made without settlement action by GAO. If the
agency is unable to resolve the legality or propriety of a claim,
however, the claim should be submitted to GAO for settlement action,
as provided in Title 4 of this manual.
[End of Appendix IV]
Appendix V: Selected Legal Citations Directly Affecting Budgetary And
Financial Accounting:
Table of Contents:
31 U.S.C. 1341, 1342, 1349, 1350, 1351, 1514, 1517, 1518, 1519:
Preventing Deficiencies in Appropriations:
31 U.S.C. 1501: Documentary Evidence Requirement for Government
Obligations:
31 U.S.C. 1551: Definitions and Applications:
31 U.S.C. 1552: Procedure for Appropriation Accounts Available for
Definite Periods:
31 U.S.C. 1553: Availability of Appropriation Accounts to Pay
Obligations:
31 U.S.C. 1554: Audit, Control, and Reporting:
31 U.S.C. 1555: Closing of Appropriation Accounts Available for
Indefinite Periods:
31 U.S.C. 1556: Comptroller General: Reports on Appropriation Accounts:
31 U.S.C. 1557: Authority for Exemptions in Appropriation Laws:
31 U.S.C. 1558: Availability of Funds Following Resolution of a
Protest:
31 U.S.C. 3302: Custodians of Money:
31 U.S.C. 3325: Vouchers:
31 U.S.C. 3511: Prescribing Accounting Requirements and Developing
Accounting Systems:
31 U.S.C. 3512: Executive Agency Accounting and Other Financial
Management Reports and Plans:
31 U.S.C. 3513: Financial Reporting and Accounting System:
31 U.S.C. 3521: Audits by Agencies:
31 U.S.C. 3526: Settlement of Accounts:
31 U.S.C. 3527: General Authority to Relieve Accountable Officials and
Agents From Liability:
31 U.S.C. 3528: Responsibilities and Relief From Liability of
Certifying Officials:
31 U.S.C. 3529: Requests for Decisions of the Comptroller General:
Preventing Deficiencies in Appropriations:
Extensive legal provisions have been enacted to control the obligation
and use of appropriated funds and to prevent deficiencies in
appropriations and the consequent need for supplemental
appropriations. Some salient provisions of law are:
31 U.S.C. 1341--Limitations on expending and obligating amounts:
"(a)(1) An officer or employee of the United States Government or of
the District of Columbia government may not:
(A) make or authorize an expenditure or obligation exceeding an amount
available in an appropriation or fund for the expenditure or
obligation;
(B) involve either government in a contract or obligation for the
payment of money before an appropriation is made unless authorized by
law;
(C) make or authorize an expenditure or obligation of funds required
to be sequestered under section 252 of the Balanced Budget and
Emergency Deficit Control Act of 1985; or;
(D) involve either government in a contract or obligation for the
payment of money required to be sequestered under section 252 of the
Balanced Budget and Emergency Deficit Control Act of 1985."
31 U.S.C. 1342--Limitation on voluntary services:
"An officer or employee of the United States Government or of the
District of Columbia government may not accept voluntary services for
either government or employ personal services exceeding that
authorized by law except for emergencies involving the safety of human
life or the protection of property. This section does not apply to a
corporation getting amounts to make loans (except paid in capital
amounts) without legal liability of the United States Government. As
used in this section, the term "emergencies involving the safety of
human life or the protection of property" does not include ongoing,
regular functions of government the suspension of which would not
imminently threaten the safety of human life or the protection of
property."
31 U.S.C. 1349--Adverse personnel actions:
"(a) An officer or employee of the United States Government or of the
District of Columbia government violating section 1341(a) or 1342 of
this title shall be subject to appropriate administrative discipline
including, when circumstances warrant, suspension from duty without
pay or removal from office."
31 U.S.C. 1350--Criminal penalty:
"An officer or employee of the United States Government or of the
District of Columbia government knowingly and willfully violating
section 1341(a) or 1342 of this title shall be fined not more than
$5,000, imprisoned for not more than 2 years, or both."
31 U.S.C. 1351--Reports on violations:
"If an officer or employee of an executive agency or an officer or
employee of the District of Columbia government violates section
1341(a) or 1342 of this title, the head of the agency or the Mayor of
the District of Columbia, as the case may be, shall report immediately
to the President and Congress all relevant facts and a statement of
actions taken."
31 U.S.C. 1514--Administrative division of apportionments:
"(a) The official having administrative control of an appropriation
available to the legislative branch [and] the judicial branch,...
subject to the approval of the President [and] the head of each
executive agency ...shall prescribe by regulation a system of
administrative control not inconsistent with accounting procedures
prescribed under law. The system shall be designed to:
(1) restrict obligations or expenditures from each appropriation to
the amount of apportionments or reapportionments of the appropriation;
and;
(2) enable the official or the head of the executive agency to fix
responsibility for an obligation or expenditure exceeding an
apportionment or reapportionment.
"(b) To have a simplified system for administratively dividing
appropriations, the head of each executive agency (except the
Commission) shall work toward the objective of financing each
operating unit, at the highest practical level, from not more than one
administrative division for each appropriation affecting the unit."
31 U.S.C. 1517--Prohibited obligations and expenditures:
"(a) An officer or employee of the United States Government or of the
District of Columbia government may not make or authorize an
expenditure or obligation exceeding:
(1) an apportionment; or;
(2) the amount permitted by regulations prescribed under section
1514(a) of this title.
"(b) If an officer or employee of an executive agency or of the
District of Columbia government violates subsection (a) of this
section, the head of the executive agency or the Mayor of the District
of Columbia, as the case may be, shall report immediately to the
President and Congress all relevant facts and a statement of actions
taken."
31 U.S.C. 1518--Adverse personnel actions:
"An officer or employee of the United States Government or of the
District of Columbia government violating section 1517(a) of this
title shall be subject to appropriate administrative discipline
including, when circumstances warrant, suspension from duty without
pay or removal from office."
31 U.S.C. 1519--Criminal penalty:
"An officer or employee of the United States Government or of the
District of Columbia government knowingly and willfully violating
section 1517(a) of this title shall be fined not more than $5,000,
imprisoned for not more than 2 years, or both."
31 U.S.C. 1501--Documentary evidence requirement for Government
obligations:
"(a) An amount shall be recorded as an obligation of the United States
Government only when supported by documentary evidence of:
(1) a binding agreement between an agency and another person
(including, an agency) that is:
(A) in writing, in a way and form, and for a purpose authorized by
law; and;
(B) executed before the end of the period of availability for
obligation of the appropriation or fund used for specific goods to be
delivered, real property to be bought or leased, or work or service to
be provided;
(2) a loan agreement showing the amount and terms of repayment;
(3) an order required by law to be placed with an agency;
(4) an order issued under a law authorizing purchases without
advertising:
(A) when necessary because of a public exigency;
(B) for perishable subsistence supplies; or;
(C) within specific monetary limits;
(5) a grant or subsidy payable:
(A) from appropriations made for payment of, or contributions to,
amounts required to be paid in specific amounts fixed by law or under
formulas prescribed by law;
(B) under an agreement authorized by law; or;
(C) under plans approved consistent with and authorized by law;
(6) a liability that may result from pending litigation;
(7) employment or services of persons or expenses of travel under law;
(8) services provided by public utilities; or;
(9) other legal liability of the Government against an available
appropriation or fund.
"(b) A statement of obligations provided to Congress or a committee of
Congress by an agency shall include only those amounts that are
obligations consistent with subsection (a) of this section."
31 U.S.C. 1551--Definitions and applications:
"(a) In this subchapter:
(1) An obligated balance of an appropriation account as of the end of
a fiscal year is the amount of unliquidated obligations applicable to
the appropriation less amounts collectible as repayments to the
appropriation.
(2) An unobligated balance is the difference between the obligated
balance and the total unexpended balance.
(3) A fixed appropriation account is an appropriation account
available for obligation for a definite period.
"(b) The limitations on the availability for expenditure prescribed in
this subchapter apply to all appropriations unless specifically
otherwise authorized by a law that specifically:
(1) identifies the appropriate account for which the availability for
expenditure is to be extended;
(2) provides that such account shall be available for recording,
adjusting, and liquidating obligations properly chargeable to that
account; and;
(3) extends the availability for expenditure of the obligated balances.
"(c) This subchapter does not apply to:
(1) appropriations for the District of Columbia government; or;
(2) appropriations to be disbursed by the Secretary of the Senate or
the Clerk of the House of Representatives."
31 U.S.C. 1552--Procedure for appropriation accounts available for
definite periods:
"(a) On September 30th of the 5th fiscal year after the period of
availability for obligation of a fixed appropriation account ends, the
account shall be closed and any remaining balance (whether obligated
or unobligated) in the account shall be canceled and thereafter shall
not be available for obligation or expenditure for any purpose.
"(b) Collections authorized or required to be credited to an
appropriation account, but not received before closing of the account
under subsection (a) or under section 1555 of this title shall be
deposited in the Treasury as miscellaneous receipts."
31 U.S.C. 1553--Availability of appropriation accounts to pay
obligations:
"(a) After the end of the period of availability for obligation of a
fixed appropriation account and before the closing of that account
under section 1552(a) of this title, the account shall retain its
fiscal-year identity and remain available for recording, adjusting,
and liquidating obligations properly chargeable to that account.
"(b)(1) Subject to the provisions of paragraph (2), after the closing
of an account under section 1552(a) or 1555 of this title, obligations
and adjustments to obligations that would have been properly
chargeable to that account, both as to purpose and in amount, before
closing and that are not otherwise chargeable to any current
appropriation account of the agency may be charged to any current
appropriation account of the agency available for the same purpose.
(2) The total amount of charges to an account under paragraph (1) may
not exceed an amount equal to 1 percent of the total appropriations
for that account.
"(c)(1) In the case of a fixed appropriation account with respect to
which the period of availability for obligation has ended, if an
obligation of funds from that account to provide funds for a program,
project, or activity to cover amounts required for contract changes
would cause the total amount of obligations from that appropriation
during a fiscal year for contract changes for that program, project,
or activity to exceed $4,000,000, the obligation may only be made if
the obligation is approved by the head of the agency (or an officer of
the agency within the Office of the head of the agency to whom the
head of the agency had delegated the authority to approve such an
obligation).
(2) In the case of a fixed appropriation account with respect to which
the period of availability for obligation has ended, if an obligation
of funds from that account to provide funds for a program, project, or
activity to cover amounts required for contract changes would cause
the total amount obligated from that appropriation during a fiscal
year for that program, project, or activity to exceed $25,000,000, the
obligation may not be made until:
(A) the head of the agency submits to the appropriate authorizing
committees of Congress and the Committees on Appropriations of the
Senate and the House of Representatives a notice in writing of the
intent to obligate such funds, together with a description of the
legal basis for the proposed obligation and the policy reasons for the
proposed obligation; and;
(B) a period of 30 days has elapsed after the notice is submitted.
(3) In this subsection, the term "contract change" means a change to a
contract under which the contractor is required to perform additional
work. Such term does not include adjustments to pay claims or
increases under an escalation clause.
"(d)(1) Obligations under this section may be paid without prior
action of the Comptroller General.
(2) This subsection does not:
(A) relieve the Comptroller General of the duty to make decisions
requested under law; or;
(B) affect the authority of the Comptroller General to settle claims
and accounts."
31 U.S.C. 1554--Audit, control, and reporting:
"(a) Any audit requirement, limitation on obligations, or reporting
requirement that is applicable to an appropriation account shall
remain applicable to that account after the end of the period of
availability for obligation of that account.
"(b)(1) After the close of each fiscal year, the head of each agency
shall submit to the President and the Secretary of the Treasury a
report regarding the unliquidated obligations, unobligated balances,
canceled balances, and adjustments made to appropriation accounts of
that agency during the completed fiscal year. The report shall be
submitted no later than 15 days after the date on which the
President's budget for the next fiscal year is submitted to Congress
under section 1105 of this title.
(2) Each report required by this subsection shall:
(A) provide a description, with reference to the fiscal year of
appropriations, of the amount in each account, its source, and an
itemization of the appropriations accounts;
(B) describe all current and expired appropriations accounts;
(C) describe any payments made under section 1553 of this title;
(D) describe any adjustment of obligations during that fiscal year
pursuant to section 1553 of this title;
(E) contain a certification by the head of the agency that the
obligated balances in each appropriation account of the agency reflect
proper existing obligations and that expenditures from the account
since the preceding review were supported by a proper obligation of
funds and otherwise were proper;
(F) describe all balances canceled under sections 1552 and 1555 of
this title.
(3) The head of each Federal agency shall provide a copy of each such
report to the Speaker of the House of Representatives and the
Committee on Appropriations, the Committee on Governmental Affairs,
and other appropriate oversight and authorizing committees of the
Senate.
"(c)(1) The Director of the Congressional Budget Office shall estimate
each year the effect on the Federal deficit of payments and
adjustments made with respect to sections 1552 and 1553 of this title.
Such estimate shall be made separately for accounts of each agency.
(2) The Director shall include in the annual report of the Director to
the Committees on the Budget of the Senate and House of
Representatives under paragraph (1) of section 202(f) of the
Congressional Budget Act of 1974 a statement of the estimates made
pursuant to paragraph (1) of this subsection during the preceding year
(including any revisions to estimates contained in earlier reports
under such paragraph). The Director shall include in any report under
paragraph (2) of that section any revisions to such estimates made
since the most recent report under paragraph (1) of such section.
"(d) The head of each agency shall establish internal controls to
assure that an adequate review of obligated balances is performed to
support the certification required by section 1108(c) of this title."
31 U.S.C. 1555--Closing of appropriation accounts available for
indefinite periods:
"An appropriation account available for obligation for an indefinite
period shall be closed, and any remaining balance (whether obligated
or unobligated) in that account shall be canceled and thereafter shall
not be available for obligation or expenditure for any purpose, if:
(1) the head of the agency concerned or the President determines that
the purposes for which the appropriation was made have been carried
out; and;
(2) no disbursement has been made against the appropriation for two
consecutive fiscal years."
31 U.S.C. 1556--Comptroller General: reports on appropriation accounts
"(a) In carrying out audit responsibilities, the Comptroller General
shall report on operations under this subchapter to:
(1) the head of the agency concerned;
(2) the Secretary of the Treasury; and;
(3) the President.
"(b) A report under this section shall include an appraisal of unpaid
obligations under fixed appropriations accounts for which the period
of availability for obligation has ended.
31 U.S.C. 1557--Authority for exemptions in appropriation laws:
"A provision of an appropriation law may exempt an appropriation from
the provisions of this subchapter and fix the period for which the
appropriation remains available for expenditure."
31 U.S.C. 1558--Availability of funds following resolution of a
protest:
"(a) Notwithstanding section 1552 of this title or any other provision
of law, funds available to an agency for obligation for a contract at
the time a protest is filed in connection with a solicitation for,
proposed award of, or award of such contract shall remain available
for obligation for 90 working days after the date on which the final
ruling is made on the protest. A ruling is considered final on the
date on which the time allowed for filing an appeal or request for
reconsideration has expired, or the date on which a decision is
rendered on such an appeal or request, whichever is later.
"(b) Subsection (a) applies with respect to any protest filed under
subchapter V of chapter 35 of this title or under section 111(f) of
the Federal Property and Administrative Services Act of 1949 (40
U.S.C. 759(f))."
31 U.S.C. 3302--Custodians of money:
"(a) Except as provided by another law, an official or agent of the
United States Government having custody or possession of public money
shall keep the money safe without:
(1) lending the money;
(2) using the money;
(3) depositing the money in a bank; and;
(4) exchanging the money for other amounts.
"(b) Except as provided in section 3718(b) of this title,* an official
or agent of the Government receiving money for the Government from any
source shall deposit the money in the Treasury as soon as practicable
without deduction for any charge or claim.
]GAO comment: This exception permits properly authorized debt
collection service fees to be paid from amounts collected]
"(c)(1) A person having custody or possession of public money,
including a disbursing official having public money not for current
expenditure, shall deposit the money without delay in the Treasury or
with a depositary designated by the Secretary of the Treasury under
law. Except as provided in paragraph (2), money required to be
deposited pursuant to this subsection shall be deposited not later
than the third day after the custodian receives the money.[A] The
Secretary or a depositary receiving a deposit shall issue duplicate
receipts for the money deposited. The original receipt is for the
Secretary and the duplicate is for the custodian.
[[A] Punctuation as in original (Pub. L. 98-369)]
(2) The Secretary of the Treasury may by regulation prescribe that a
person having custody or possession of money required by this
subsection to be deposited shall deposit such money during a period of
time that is greater or lesser than the period of time specified by
the second sentence of paragraph (1).
"(d) An official or agent not complying with subsection (b) of this
section may be removed from office. The official or agent may be
required to forfeit to the Government any part of the money held by
the official or agent and to which the official or agent may be
entitled.
"(e) An official or agent of the Government having custody or
possession of public money shall keep an accurate entry of each amount
of public money received, transferred, and paid.
"(f) When authorized by the Secretary, an official or agent of the
Government having custody or possession of public money, or performing
other fiscal agent services, may be allowed necessary expenses to
collect, keep, transfer, and pay out public money and to perform those
services. However, money appropriated for those expenses may not be
used to employ or pay officers and employees of the Government.
31 U.S.C. 3325--Vouchers:
"(a) A disbursing official in the executive branch of the United
States Government shall:
(1) disburse money only as provided by a voucher certified by:
(A) the head of the executive agency concerned; or;
(B) an officer or employee of the executive agency having written
authorization from the head of the agency to certify vouchers;
(2) examine a voucher if necessary to decide if it is:
(A) in proper form;
(B) certified and approved; and;
(C) computed correctly on the facts certified; and;
(3) except for the correctness of computations on a voucher, be held
accountable for carrying out clauses (1) and (2) of this subsection.
"(b) Subsection (a) of this section does not apply to disbursements of
a military department of the Department of Defense, except for
disbursements for departmental pay and expenses in the District of
Columbia.
"(c) On request, the Secretary of the Treasury may provide to the
appropriate officer or employee of the United States Government a list
of persons receiving periodic payments from the Government. When
certified and in proper form, the list may be used as a voucher on
which the Secretary may disburse money."
31 U.S.C. 3511--Prescribing accounting requirements and developing
accounting systems:
"(a) The Comptroller General shall prescribe the accounting
principles, standards, and requirements that the head of each
executive agency shall observe. Before prescribing the principles,
standards, and requirements, the Comptroller General shall consult
with the Secretary of the Treasury and the President on their
accounting, financial reporting, and budgetary needs, and shall
consider the needs of the heads of the other executive agencies.
"(b) Requirements prescribed under subsection (a) of this section
shall:
(1) provide for suitable integration between the accounting process of
each executive agency and the accounting of the Department of the
Treasury;
(2) allow the head of each agency to carry out section 3512 of this
title; and;
(3) provide a method of:
(A) integrated accounting for the United States Government;
(B) complete disclosure of the results of the financial operations of
each agency and the Government; and;
(C) financial information and control the President and Congress
require to carry out their responsibilities.
"(c) Consistent with subsections (a) and (b) of this section:
(1) the authority of the Comptroller General continues under section
205(b) of the Federal Property and Administrative Services Act of 1949
(40 U.S.C. 486(b)); and;
(2) the Comptroller General may prescribe the forms, systems, and
procedures that the judicial branch of the Government (except the
Supreme Court) shall observe.
"(d) The Comptroller General, the Secretary, and the President shall
conduct a continuous program for improving accounting and financial
reporting in the Government."
31 U.S.C. 3512--Executive agency accounting and other financial
management reports and plans :
"(a)(1) The Director of the Office of Management and Budget shall
prepare and submit to the appropriate committees of the Congress a
financial management status report and a governmentwide 5-year
financial management plan.
(2) A financial management status report under this subsection shall
include:
(A) A description and analysis of the status of financial management
in the executive branch;
(B) a summary of the most recently completed financial statements:
(i) of Federal agencies under section 3515 of this title; and;
(ii) of Government corporations;
(C) a summary of the most recently completed financial statement
audits and reports:
(i) of Federal agencies under section 3521(e) and (f) of this title; and
(ii) of Government corporations;
(D) a summary of reports on internal accounting and administrative
control systems submitted to the President and the Congress under the
amendments made by the Federal Managers' Financial Integrity Act of
1982 (Public Law 97-255); and;
(E) any other information the Director considers appropriate to fully
inform the Congress regarding the financial management of the Federal
Government.
(3)(A) A governmentwide 5-year financial management plan under this
subsection shall describe the activities the Director, the Deputy
Director for Management, the Controller of the Office of Federal
Financial Management, and agency Chief Financial Officers shall
conduct over the next 5 fiscal years to improve the financial
management of the Federal Government.
(B) Each governmentwide 5-year financial management plan prepared
under this subsection shall:
(i) describe the existing financial management structure and any changes
needed to establish an integrated financial management system;
(ii) be consistent with applicable accounting principles, standards,
and requirements;
(iii) provide a strategy for developing and integrating individual
agency accounting, financial information, and other financial
management systems to ensure adequacy, consistency, and timeliness of
financial information;
(iv) identify and make proposals to eliminate duplicative and
unnecessary systems, including encouraging agencies to share systems
which have sufficient capacity to perform the functions needed;
(v) identify projects to bring existing systems into compliance with the
applicable standards and requirements;
(vi) contain milestones for equipment acquisitions and other actions
necessary to implement the 5-year plan consistent with the
requirements of this section;
(vii) identify financial management personnel needs and actions to
ensure those needs are met;
(viii) include a plan for ensuring the annual audit of financial
statements of executive agencies pursuant to section 3521(h) of this
title; and;
(ix) estimate the costs of implementing the governmentwide 5-year plan.
(4)(A) Not later than 15 months after the date of the enactment of
this subsection, the Director of the Office of Management and Budget
shall submit the first financial management status report and
governmentwide 5-year financial management plan under this subsection
to the appropriate committees of the Congress.
(B)(i) Not later than January 31 of each year thereafter, the Director
of the Office of Management and Budget shall submit to the appropriate
committees of the Congress a financial management status report and a
revised governmentwide 5-year financial management plan to cover the
succeeding 5 fiscal years, including a report on the accomplishments
of the executive branch in implementing the plan during the preceding
fiscal year.
(ii) The Director shall include with each revised governmentwide 5-
year financial management plan a description of any substantive
changes in the financial statement audit plan required by paragraph
(3)(B)(viii), progress made by executive agencies in implementing the
audit plan, and any improvements in Federal Government financial
management related to preparation and audit of financial statements of
executive agencies.
(5) Not later than 30 days after receiving each annual report under
section 902(a)(6) of this title, the Director shall transmit to the
Chairman of the Committee on Government Operations of the House of
Representatives and the Chairman of the Committee on Governmental
Affairs of the Senate a final copy of that report and any comments on
the report by the Director.
"(b) The head of each executive agency shall establish and maintain
systems of accounting and internal controls that provide:
(1) complete disclosure of the financial results of the activities of
the agency;
(2) adequate financial information the agency needs for management
purposes;
(3) effective control over, and accountability for, assets for which
the agency is responsible, including internal audit;
(4) reliable accounting results that will be the basis for:
(A) preparing and supporting the budget requests of the agency;
(B) controlling the carrying out of the agency budget; and;
(C) providing financial information the President requires under
section 1104(e) of this title; and;
(5) suitable integration of the accounting of the agency with the
central accounting and reporting responsibilities of the Secretary of
the Treasury under section 3513 of this title.
"(c)(1) To ensure compliance with subsection (a)(3) of this section
and consistent with standards the Comptroller General prescribes, the
head of each executive agency shall establish internal accounting and
administrative controls that reasonably ensure that:
(A) obligations and costs comply with applicable law;
(B) all assets are safeguards against waste, loss, unauthorized use,
and misappropriation; and;
(C) revenues and expenditures applicable to agency operations are
recorded and accounted for properly so that accounts and reliable
financial and statistical reports may be prepared and accountability
of the assets may be maintained.
(2) Standards the Comptroller General prescribes under this subsection
shall include standards to ensure the prompt resolution of all audit
findings.
"(d)(1) In consultation with the Comptroller General, the Director of
the Office of Management Budget:
(A) shall establish by December 31, 1982, guidelines that the head of
each executive agency shall follow in evaluating the internal
accounting and administrative control systems of the agency to decide
whether the systems comply with subsection (b) of this section; and;
(B) may change a guideline when considered necessary.
(2) By December 31 of each year (beginning in 1983), the head of each
executive agency, based on an evaluation conducted according to
guidelines prescribed under paragraph (1) of this subsection, shall
prepare a statement on whether the systems of the agency comply with
subsection (b) of this section, including:
(A) if the head of an executive agency decides the systems do not
comply with subsection (b) of this section, a report identifying any
material weakness in the systems and describing the plans and schedule
for correcting the weakness; and;
(B) a separate report on whether the accounting system of the agency
conforms to the principles, standards, and requirements the
Comptroller General prescribes under section 3511(a) of this title.
(3) The head of each executive agency shall sign the statement and
reports required by this subsection and submit them to the President
and Congress. The statement and reports are available to the public,
except that information shall be deleted from a statement or report
before it is made available if the information specifically is:
(A) prohibited from disclosure by law; or;
(B) required by Executive order to be kept secret in the interest of
national defense or the conduct of foreign affairs.
"(e) To assist in preparing a cost-based budget under section 1108(b)
of this title and consistent with principles and standards the
Comptroller General prescribes, the head of each executive agency
shall maintain the accounts of the agency on an accrual basis to show
the resources, liabilities, and costs of operations of the agency. An
accounting system under this subsection shall include monetary
property accounting records.
"(f) The Comptroller General shall:
(1) cooperate with the head of each executive agency in developing an
accounting system for the agency; and;
(2) approve the system when the Comptroller General considers it to be
adequate and in conformity with the principles, standards, and
requirements prescribed under section 3511 of this title.
"(g) The Comptroller General shall review the accounting systems of
each executive agency. The results of a review shall be available to
the head of the executive agency, the Secretary, and the President.
The Comptroller General shall report to Congress on a review when the
Comptroller General considers it proper."
31 U.S.C. 3513--Financial reporting and accounting system:
"(a) The Secretary of the Treasury shall prepare reports that will
inform the President, Congress, and the public on the financial
operations of the United States Government. The reports shall include
financial information the President requires. The head of each
executive agency shall give the Secretary reports and information on
the financial conditions and operations of the agency the Secretary
requires to prepare the reports.
"(b) The Secretary may:
(1) establish facilities necessary to prepare the reports; and;
(2) reorganize the accounting functions and procedures and financial
reports of the Department of the Treasury to develop an effective and
coordinated system of accounting and financial reporting in the
Department that will integrate the accounting results for the
Department and be the operating center for consolidating accounting
results of other executive agencies with accounting results of the
Department.
"(c) The Comptroller General shall:
(1) cooperate with the Secretary in developing and establishing the
reporting and accounting system under this section; and;
(2) approve the system when the Comptroller General considers it to be
adequate and in conformity with the principles, standards, and
requirements prescribed under section 3511 of this title."
31 U.S.C. 3521--Audits by agencies:
"(a) Each account of an agency shall be audited administratively
before being submitted to the Comptroller General. The head of each
agency shall prescribe regulations for conducting the audit and
designate a place at which the audit is to be conducted. However, a
disbursing official of an executive agency may not administratively
audit vouchers for which the official is responsible. With the consent
of the Comptroller General, the head of the agency may waive any part
of an audit.
"(b) The head of an agency may prescribe a statistical sampling
procedure to audit vouchers of the agency when the head of the agency
decides economies will result from using the procedure. The
Comptroller General:
(1) may prescribe the maximum amount of a voucher that may be audited
under this subsection; and;
(2) in reviewing the accounting system of the agency, shall evaluate
the adequacy and effectiveness of the procedure.
"(c) A disbursing or certifying official acting in good faith under
subsection (b) of this section is not liable for a payment or
certification of a voucher not audited specifically because of the
procedure prescribed under subsection (b) if the official and the head
of the agency carry out diligently collection action the Comptroller
General prescribes.
"(d) Subsections (b) and (c) of this section do not:
(1) affect the liability, or authorize the relief, of a payee,
beneficiary, or recipient of an illegal, improper, or incorrect
payment; or;
(2) relieve a disbursing or certifying official, the head of an
agency, or the Comptroller General of responsibility in carrying out
collection action against a payee, beneficiary, or recipient.
31 U.S.C. 3526--Settlement of accounts:
"(a) The Comptroller General shall settle all accounts of the United
States Government and supervise the recovery of all debts finally
certified by the Comptroller General as due the Government.
"(b) A decision of the Comptroller General under section 3529 of this
title is conclusive on the Comptroller General when settling the
account containing the payment.
"(c)(1) The Comptroller General shall settle an account of an
accountable official within 3 years after the date the Comptroller
General receives the account. A copy of the certificate of settlement
shall be provided the official.
(2) The settlement of an account is conclusive on the Comptroller
General after 3 years after the account is received by the Comptroller
General. However, an amount may be charged against the account after
the 3-year period when the Government has or may have lost money
because the official acted fraudulently or criminally.
(3) A 3-year period under this subsection is suspended during a war.
(4) This subsection does not prohibit:
(A) recovery of public money illegally or erroneously paid;
(B) recovery from an official of a balance due the Government under a
settlement within the 3-year period; or;
(C) an official from clearing an account of questioned items as
prescribed by law.
"(d) On settling an account of the Government, the balance certified
by the Comptroller General is conclusive on the executive branch of
the Government. On the initiative of the Comptroller General or on
request of an individual whose accounts are settled or the head of the
agency to which the account relates, the Comptroller General may
change the account within a year after settlement. The decision of the
Comptroller General to change the account is conclusive on the
executive branch.
"(e) When an amount of money is expended under law for a treaty or
relations with a foreign country, the President may:
(I) authorize the amount to be accounted for each year specifically by
settlement of the Comptroller General when the President decides the
amount expended may be made public; or;
(2) make, or have the Secretary of State make, a certificate of the
amount expended if the President decides the amount is not to be
accounted for specifically. The certificate is a sufficient voucher
for the amount stated in the certificate.
"(f) The Comptroller General shall keep all settled accounts,
vouchers, certificates, and related papers until they are disposed of
as prescribed by law.
"(g) This subchapter does not prohibit the Comptroller General from
suspending an item in an account to get additional evidence or
explanations needed to settle an account."
31 U.S.C. 3527--General authority to relieve accountable officials and
agents from liability:
"(a) Except as provided in subsection (b) of this section, the
Comptroller General may relieve a present or former accountable
official or agent of an agency responsible for the physical loss or
deficiency of public money, vouchers, checks, securities, or records,
or may authorize reimbursement from an appropriation or fund available
for the activity in which the loss or deficiency occurred for the
amount of the loss or deficiency paid by the official or agent as
restitution, when:
(1) the head of the agency decides that:
(A) the official or agent was carrying out official duties when the
loss or deficiency occurred, or the loss or deficiency occurred
because of an act or failure to act by a subordinate of the official
or agent; and;
(B) the loss or deficiency was not the result of fault or negligence
by the official or agent;
(2) the loss or deficiency was not the result of an illegal or
incorrect payment; and;
(3) the Comptroller General agrees with the decision of the head of
the agency.
"(b)(1) The Comptroller General shall relieve a disbursing official of
the armed forces responsible for the physical loss or deficiency of
public money, vouchers, or records, or shall authorize reimbursement
from an appropriation or fund available for reimbursement, of the
amount of the loss or deficiency paid by or for the official as
restitution, when:
(A) the Secretary of Defense or the appropriate Secretary of the,
military department of the Department of Defense decides that the
official was carrying out official duties when the loss or deficiency
occurred;
(B) the loss or deficiency was not the result of an illegal or
incorrect payment; and;
(C) the loss or deficiency was not the result of fault or negligence
by the official.
(2) The finding of the Secretary involved is conclusive on the
Comptroller General.
"(c) On the initiative of the Comptroller General or written
recommendation of the head of an agency, the Comptroller General may
relieve a present or former disbursing official of the agency
responsible for a deficiency in an account because of an illegal,
improper, or incorrect payment, and credit the account for the
deficiency, when the Comptroller General decides that the payment was
not the result of bad faith or lack of reasonable care by the
official. However, the Comptroller General may deny relief when the
Comptroller General decides the head of the agency did not carry out
diligently collection action under procedures prescribed by the
Comptroller General.
"(d)(1) When the Comptroller General decides it is necessary to adjust
the account of an official or agent granted relief under subsection
(a) or (c) of this section, the amount of the relief shall be charged:
(A) to an appropriation specifically provided to be charged; or;
(B) if no specific appropriation, to the appropriation or fund
available for the expense of the accountable function when the
adjustment is carried out.
(2) Subsection (c) of this section does not:
(A) affect the liability, or authorize the relief, of a payee,
beneficiary, or recipient of an illegal, improper, or incorrect
payment; or;
(B) relieve an accountable official, the head of an agency, or the
Comptroller General of responsibility in carrying out collection
action against a payee, beneficiary, or recipient.
"(e) Relief provided under this section is in addition to relief
provided under another law."
31 U.S.C. 3528--Responsibilities and relief from liability of
certifying officials:
"(a) A certifying official certifying a voucher is responsible for:
(1) information stated in the certificate, voucher, and supporting
records;
(2) the computation of a certified voucher under this section and
section 3325 of this title;
(3) the legality of a proposed payment under the appropriation or fund
involved; and;
(4) repaying a payment:
(A) illegal, improper, or incorrect because of an inaccurate or
misleading certificate;
(B) prohibited by law; or;
(C) that does not represent a legal obligation under the appropriation
or fund involved.
"(b)(1) The Comptroller General may relieve a certifying official from
liability when the Comptroller General decides that:
(A) the certification was based on official records and the official
did not know, and by reasonable diligence and inquiry could not have
discovered, the correct information; or;
(B) (i) the obligation was incurred in good faith;
(ii) no law specifically prohibited the payment; and;
(iii) the United States Government received value for payment.
(2) The Comptroller General may deny relief when the Comptroller
General decides the head of the agency did not carry out diligently
collection action under procedures described by the Comptroller
General.
"(c) The Comptroller General shall relieve a certifying official from
liability for an overpayment:
(1) to a common carrier under section 3726 of this title when the
Comptroller General decides the overpayment occurred only because the
administrative audit before payment did not verify transportation
rates, freight classifications, or land-grant deductions; or;
(2) provided under a Government bill of lading or transportation
request when the overpayment was the result of using improper
transportation rates or classifications or the failure to deduct the
proper amount under a land-grant law or agreement.
"(d) This section does not apply to disbursements of a military
department of the Department of Defense, except disbursements for
departmental pay and expenses in the District of Columbia."
31 U.S.C. 3529—Requests for decisions of the Comptroller General:
"(a) A disbursing or certifying official or the head of an agency may
request a decision from the Comptroller General on a question
involving:
(1) a payment the disbursing official or head of the agency will make;
or;
(2) a voucher presented to a certifying official for certification.
"(b) The Comptroller General shall issue a decision reqUested under
this section."
[End of Appendix V]
Appendix VI: Transition Period For Closing Accounts:
Note: This Appendix Expires On September 30, 1993:
Table of Contents:
Introduction:
A. Restoration of Surplus Authority to Expired Accounts:
B. Cancellation of Merged Surplus Authority:
C. Cancellation of "M" Account Balances Older Than 5 Years:
D. Payments of "M" Account Obligations:
[End of table of contents]
Introduction:
The procedures for closing appropriation and fund accounts at fiscal
year-end were changed by enactment of Public Law 101-510 on November
5, 1990, which amended the provisions in 31 U.S.C. 1551 through 1557.
The act provides a transition period to phase in the application of
the new procedures affecting accounts established under the prior law.
The act specifies dates by which certain actions are to be
accomplished which affect the availability of appropriation and fund
balances and the closing of these accounts.
A. Restoration of Surplus Authority to Expired Accounts:
As required by the law, expired appropriation and fund accounts at the
time the act took effect (November 5, 1990) had their previously
withdrawn unobligated balances (referred to as surplus authority)
restored by Treasury to the agencies' expired accounts. These
unobligated balances will remain with the agencies' expired accounts
and be available for obligation adjustments but not new obligations.
The accounts will remain in the expired status for 5 years and retain
their fiscal year designation, after which they will close. Thus,
fixed-period appropriations and funds that expired at the end of
fiscal years 1989 and 1990 will follow the new rules for closing
accounts and close at September 30 of 1994 and 1995, respectively.
(See chapter 4 of this title.)
B. Cancellation of Merged Surplus Authority:
Public Law 101-510 required the cancellation of all merged surplus
authority on the records of Treasury by December 5, 1990. Merged
surplus authority was that unobligated authority withdrawn from
corresponding appropriations in the merged ("M") accounts. The
appropriations involved were those that expired at the end of fiscal
year 1988 and prior years. The canceled merged surplus authority is
unavailable to agencies for upward adjustments to obligations in the
"M" account.
C. Cancellation of "M" Account Balances Older Than 5 Years:
The unobligated and obligated balances in the "M" account for more
than 5 years were deobligated and withdrawn or canceled on March 6,
1991. This applied to appropriations that expired at the end of fiscal
year 1983 and prior years. However, obligated amounts supported by
documentary evidence that payments were to be made by May 5, 1991, or
the obligations covered severance pay for foreign national employees
were not required to be deobligated. After the payments are made, any
residual unobligated or obligated balances remaining must be canceled.
At September 30, 1991, any obligated balances in the "M" account for
more than 5 years were deobligated and any unobligated balances were
withdrawn to Treasury and can no longer be restored to the agency. The
same process took place on September 30, 1992. At September 30, 1993,
all "M" account balances will be canceled and the account will no
longer be used. The following table shows the schedule by fiscal year.
Fiscal year of obligated balance in "M" account at November 5, 1990:
1983 and prior;
Year deobligated or canceled at September 30: 1991[A].
Fiscal year of obligated balance in "M" account at November 5, 1990:
1984;
Year deobligated or canceled at September 30: 1991.
Fiscal year of obligated balance in "M" account at November 5, 1990:
1985;
Year deobligated or canceled at September 30: 1992.
Fiscal year of obligated balance in "M" account at November 5, 1990:
1986-1988;
Year deobligated or canceled at September 30: 1993.
[A] As provided in law, the actual date of cancellation was March 6,
1991.
D. Payments of "M" Account Obligations:
Payments for upward adjustments to obligations in the "M" account and
payments for obligations that are deobligated because they have been
in the "M" account for more than 5 years, or for unpaid obligations in
the "M" accounts on September 30, 1993, can be charged to an unexpired
appropriation for the same general purpose as the closed
appropriation. As alternatives, agencies can request from the Congress
a reappropriation or other specific legislative authority to make the
payments. The conditions in section 4.4 of this title apply for making
any of these payments.
Obligation adjustments related to "contract changes" require special
handling and are applicable to "M" account transactions. (See
subsection 3.3.B for the specific reporting and approval requirements.)
[End of Appendix VI]
Index:
The page numbers used in this index indicate the chapter followed by the
page within the chapter. The digit representing Title 7 is not shown.
Accountable officers:
accountability concept, 7-1, 7-3;
certifying officer responsibilities, 6-7, 7-1, 7-10;
collections, 5-2;
data authentication, 7-6;
disbursing officer responsibilities, 7-1;
electronic signature, 7-6;
imprest fund cashier, 6-12;
personal liability, 7-1, 8-1, 8-5, 8-6;
reliance on organizational structure and operating procedures, 7-3;
reliance on statistical sampling, 7-8 reliance on systems and
controls, 7-2, 7-10;
relief of, 8-1, 8-6;
responsibility, 7-1;
right to an advance decision, 6-13, 8-1;
settlement of accounts, 8-1, 8-4, 8-5.
Account settlement:
see: Settlement of accounts.
Account symbols and titles, 1-1, 2-1, 5-3, 8-14.
Accounting forms:
account settlement, 8-4;
notice of exception, 8-4;
responsibility for prescribing, 1-1, 6-2, 1-3;
Administrative adjustment of claims, 6-9.
Administrative subdivision of funds, 2-6, 3-3.
Advance decisions, 6-13, 7-12, 8-1.
Agency:
defined, 1-1;
responsibilities, 1-2.
Allotments, 2-6.
Antideficiency Act, (Also see: Obligations) 2-6, 2-10, 3-4, 3-6, 4-3,
4-5.
Apportionment, 2-6, 3-3, 3-7.
Appropriations (Also see: Budget authority; Year-end closing of
accounts):
canceled balances, 4-3;
closed, 4-1, 4-3, 4-5;
continuing, 2-3;
collections, see: Collections;
definition, 3-1;
disbursements, see: Disbursements expenditure transactions, 2-9
expired, 4-1, 4-5, VI-3;
federal account symbols and titles, see: Account symbols and titles
impoundment, 2-7;
joint resolutions, see: continuing appropriations limitations, 2-6;
"M" accounts, VI-3;
merged surplus, VI-3;
nonexpenditure transactions, 2-8;
reappropriation, 4-3, VI-4;
recording of, 2-1, 2-3, 2-8;
restoration, VI-3;
reporting of, 2-4, 2-8;
settlement of, see: Settlement of accounts;
transactions among accounts, 2-8 warrants, 2-2, 2-3.
Budgetary reserves, 2-7.
Budget authority:
continuing appropriations, 2-3;
impoundment, 2-7;
joint resolutions, see: Continuing appropriations limitations, 2-2, 2-
6;
reimbursements between agencies, 2-9.
Certifying officer:
see: Accountable officers.
Closed appropriations see: Appropriations.
Closing of accounts: see: Year-end closing of accounts.
Collections:
accounting control, 5-2, 8-2;
availability of special fund receipts, 5-6, 5-7;
between government agencies, 2-9;
classes of funds, 5-1;
closed appropriations, 4-2;
credit to appropriation and fund accounts, 2-9, 4-2, 5-4, 5-5;
debts owed the government, 5-11;
deposit and documentation, 5-2, 5-3, 5-7;
expired appropriations, 4-2;
from government employees, 5-10;
inscription and endorsement of remittances, 5-3;
On-Line Payment and Collection (OPAC) System, 5-12;
other, 5-7 (Also see: Special and trust fund receipts);
recovery of damages, 5-9;
refunds or reimbursements, 4-2, 5-5;
sale of personal property, 5-8;
separation of duties, 5-2;
special and trust fund, see: Special and trust fund receipts;
unidentified remittances, 5-12.
Commitments, 3-7.
Contingent liabilities, 3-5.
Continuing appropriations, 2-3.
Credit cards, 6-11.
Data authentication, 7-6.
Deposits: see: Collections.
Deobligation, 2-12, 3-6.
Disbursing officer: see: Accountable officers.
Disbursing operations (Also see: Accountable officers):
accounts payable for closed accounts, 6-10;
administrative adjustment of claims, 6-9;
approval and certification, 6-7, 7-1, 7-4, III-3;
authorities, 6-1, III-3;
credit cards, 6-11;
data authentication, 7-6;
documentation, alternative conditions, 6-3;
electronic certification, 7-6 evaluation of, 7-10, 7-11;
excepted organizations, 6-1 FMFIA reviews, 7-2, 7-10, 7-11;
forms and documentation, 6-2, 6-5, 1-3, III-6;
grants and cooperative agreements, 6-14 imprest funds, 6-12;
internal controls, 6-1, 6-9, 7-3 periodic reviews, 6-14;
prepayment examination, 6-7, 7-4 prompt payment, 6-7, 6-8, 7-8;
requests for alternative procedures, 7-9;
special requirements if weaknesses exist, 7-12;
statistical sampling, 7-8, III-3;
unvouchered payments, 6-5 voucher examination, 6-7, 7-4.
Disbursements--special requirements advertising, IV-3;
contract field printing, IV-3;
long distance telephone service, IV-3;
payment in foreign currency, IV-4;
state and local taxes, IV-4;
tort claims, IV-5;
transportation, IV-6;
travel advances, IV-6;
unclaimed moneys and funds, IV-6.
Economy Act, 2-8, 2-11, 2-12.
Electronic certification, 7-6.
Electronic signatures, 7-6.
Examination of vouchers for payment see: Disbursing operations.
Exchange or sale of personal property, 5-8.
Expired accounts (appropriations):
availability of appropriations for obligation, 3-7, 4-1;
basis for closing account balances, 4-1;
controls and records, 4-3;
crediting collections, 4-2, 5-5 "M" accounts, VI-3;
payment of obligations, 4-1, VI-4 reporting, 4-3;
restoration, VI-3;
transition period, VI-3.
Fast payment procedures see: Disbursing operations.
Federal Managers' Financial Integrity Act:
agency responsibilities, 1-2, 8-2;
review, 6-14, 7-10;
use of, 7-11.
Fiscal irregularity:
definition, 8-1;
deposits, 5-4;
documenting, 8-11;
notice of exception, 8-4;
reporting, 8-2.
Forms: see: Accounting forms.
Government corporation:
definition, 1-1;
disbursements, 6-1;
state and local taxes, IV-4;
Grants and cooperative agreements, 6-13.
Impoundment:
deferral, 2-7;
rescission, 2-7.
Imprest funds:
accountability, 6-12;
agency responsibility, 6-13;
prepayment examination, 6-8;
purpose, 6-12;
state and local taxes, IV-5;
verification and audit, 6-13.
Improper payments:
adjustment of accounts, 8-14;
agency determinations, 8-9;
check losses, 8-10;
definition, 8-1;
relief, 8-9, 8-14;
repayment, 8-5;
reporting, 8-2;
responsibility for, 7-1;
required collection efforts, 8-11.
Interagency agreements: see: Interagency transactions.
Interagency transactions:
agency responsibilities, 2-10;
collections for another agency, 5-7;
disputes, 2-12;
Economy Act, 2-8, 2-11, 2-12;
Intragovernmental Billing and Collection System, 2-9.
Irregularity: see: Fiscal irregularity.
"M" accounts: see: Expired accounts; Closed accounts.
Message authentication see: Data authentication.
Notice of Exception, 8-4.
Obligations (Also see: Budget authority):
accountability, 3-7, 3-9;
availability concept, 2-2, 3-1, 4-1, 4-3;
certifying, 3-9;
collections, 5-8;
commitments, 3-7;
concealment of violation, 3-8;
contingent liabilities, 3-5;
contract change adjustments, 3-2, 4-1;
control over, 2-5, 3-3, 3-10;
criteria for, 3-1;
cut-off procedure, 3-7;
deobligation, 2-12, 3-6;
documenting, 2-5, 3-3, 3-4;
estimating, 3-6;
limitations, 2-6, 2-7, 3-7, 4-3;
incurring, 3-1;
payment in foreign currency, IV-4;
reconciling, 3-9;
recording, 2-8, 2-9, 3-3, 3-4, 3-6;
reporting and certifying, 3-9, 4-3.
Physical loss or deficiency:
adjustment of accounts, 8-14;
agency determinations, 8-8;
Department of Defense, 8-9
definition, 8-1;
relief, 8-6, 8-7;
Department of Defense, 8-8;
repayment, 8-5;
reporting, 8-2.
Prompt Payment Act, 6-4, 6-7, 6-8, 7-8.
Reappropriation, 4-3, VI-4.
Receipts: see: Collections.
Recovery of damages, 5-9.
Refunds: see: Collections.
Reimbursements see: Collections:
Relief of accountable officers:
adjustment of accounts, 8-14;
agency responsibilities, 8-7, 8-8, 8-9, 8-11;
check losses, 8-10;
documentation requirements, 8-11;
exceptions issued, 8-4;
general, 8-6;
improper payments, 8-1, 8-6, 8-9;
physical loss or deficiency, 8-6, 8-7, 8-8;
required collection efforts, 8-11;
standards, 8-7, 8-8, 8-9;
time limitation, 8-5.
Restoration, VI-3.
Sale of personal property, 5-8.
Settlement of accounts, 8-1, 8-4, 8-5.
Special and trust fund receipts, 2-4, 2-9, 5-1, 5-6, 5-7.
Standard general ledger, 2-1, 2-5, 2-6, 3-7.
Statistical sampling:
certifying obligations, 3-11, III-4;
fast pay procedures, 7-9;
Federal Managers' Financial Integrity Act, 7-11;
use of, III-3;
voucher examination, 6-8, 7-5, 7-8.
Treasury Department/General Accounting Office Joint Regulations, II-1.
Unidentified remittances, 5-12.
U.S. Government Standard General Ledger: see: Standard general ledger.
Voucher processing: see: Disbursing operations; Statistical sampling.
Year-end closing of accounts:
accounts payable, 4-3, 6-10;
basis for closing, 4-1;
canceled balances, 4-3;
closed appropriations, 4-3;
controls, 4-3;
crediting of collections, 4-2, 5-5;
fixed period appropriations, 4-1;
no-year appropriations, 4-2;
records requirements, 4-3, 6-11;
reporting, 4-3;
transition period for closing accounts, VI-1.
[End of Index]
[End of Policy and Procedures Manual, May 1993]