| SUMMARY OF MAJOR CHANGES TO |
|DFAS-IN REGULATION 37-1, CHAPTER 8 |
|“OBLIGATION MANAGEMENT” |
| |
|All changes are denoted by blue font |
| |
|Substantive revisions are denoted by a ( preceding the section, |
|paragraph, table or figure that includes the revision |
| |
|Hyperlinks are denoted by underlined, bold, italic, blue font |
|PARA |EXPLANATION OF CHANGE/REVISION |PURPOSE |
|Overall |Editorial changes. |Refresh |
|0809 |Deleted guidance for incentive awards and referenced DoDFMR |Update |
| |Volume 3, Chapter 8, Paragraph 080901. | |
|081202 |Added reference to DoDFMR Volume 3, Chapter 8, Paragraph 080901. |Update |
|081203A.2. |For guidance on obligating incentive awards, referenced DoDFMR |Update |
| |Volume 3, Chapter 8, Paragraph 080901. | |
|Table 8-4 |For incentive award guidance, referenced DoDFMR Volume 3, |Update |
| |Chapter 8, Paragraph 080901. Renumbered Note 2-5. to 1-4. | |

TABLE OF CONTENTS

CHAPTER 8 OBLIGATION MANAGEMENT

0801 General

0802 Responsibilities

0803 Appropriation Legally Available

0804 Continuing Resolution Authority

0805 Obligations in the Absence of Appropriations

0806 Rules of Obligation

0807 Recording Obligations

0808 Processing Obligation Transactions

*0809 Estimated Obligations

0810 Signatures on Obligations Documents

0811 Obligations for Problem Disbursements

*0812 Obligation Documentation

0813 Forwarding Documentation to Accounting Activity

0814 Reconciling Electronic Interfaces of Obligation Transactions

0815 Obligation Adjustments in Expired Accounts

0816 Recording Obligation Adjustments

0817 Foreign Currency Fluctuation Program Obligations

0818 Section 3732 Authority

0819 Recoveries

0820 Reducing Liabilities and Related Obligations

Table 8-1 Basis for Recording Obligations

Table 8-2 Obligations for Intra-Government Agreements

Table 8-3 Obligations for Military Personnel Services and Benefits

*Table 8-4 Obligations for Civilian Personnel Services, Incentive Awards and Severance Pay

Table 8-5 Obligations for Travel and Transportation

Table 8-6 Miscellaneous Rules

*Table 8-7 Obligations for Adjustments

CHAPTER 8

OBLIGATION MANAGEMENT

0801 GENERAL

080101. This chapter contains information on obligation management not covered in the Department of Defense Financial Management Regulation (DoDFMR), Volume 3, Chapter 8.

080102. All obligations require a standard document number (SDN). SDN formats can be found in DFAS-IN Manual 37-100-** (** indicates fiscal year (FY)).

0802 RESPONSIBILITIES

080201. The fund holder is primarily responsible for managing obligations. This includes:

A. Reviewing obligation documents for compliance.

B. Ensuring the accounting classification cited on the obligation document is appropriate for the stated purpose of the obligation.

C. Ensuring the amount obligated meets statutory and regulatory provisions.

D. Ensuring the obligation is recorded timely and accurately.

080202. Accounting activities are responsible for ensuring the integrity and accuracy of the obligation information. Accounting activities will not accept, process, or maintain obligation documentation that fails to satisfy applicable statutory and regulatory guidance. In no instance will the accounting activity fail to record a valid obligation.

0803 APPROPRIATION LEGALLY AVAILABLE

Whether appropriations are legally available for obligation and expenditure depends upon the following:

080301. The purpose of the obligation must be one for which the appropriation was made (31 United States Code (U.S.C.) 1301(a)).

080302. The obligation must be incurred within the time that the appropriation was made available for new obligations (31 U.S.C. 1502(a)).

080303. The obligation may not exceed the amount appropriated by statute, nor may it be incurred before the appropriation becomes law, unless otherwise provided by law (31 U.S.C. 1342 and 41 U.S.C. 11).

0804 CONTINUING RESOLUTION AUTHORITY (CRA)

080401. Definition. A CRA is an interim appropriation, enacted to provide authority for specific ongoing activities in the event that regular appropriations have not been enacted by the beginning of the fiscal year or the expiration of the previous CRA. A CRA has a fixed life and provides the authority necessary to allow operations to continue in the absence of appropriations.

080402. Operations Under a CRA. Unless the Office of the Secretary of Defense (OSD) issues other instructions, a CRA provides for the following:

A. Rate of execution generally will not exceed the amount contained in the President’s budget, the previous year’s rate of execution, or the amount recommended by the House and Senate Appropriations Committees, whichever is the lowest or most restrictive.

B. No new starts may be initiated. Operations & Maintenance, Army (OMA)-funded minor construction is not considered a new start.

C. No increase in scope of ongoing programs is permitted.

D. No new multiyear procurements are permitted.

080403. Additional Guidance for Army Activities. Additional guidance for Army activities can be found in a publication entitled, Continuing Resolution Authority General Guidance, located on the internet at www.asafm.army.mil/pubs.

0805 OBLIGATIONS IN THE ABSENCE OF APPROPRIATIONS

080501. In the event that neither an Appropriation Act nor a CRA has been enacted, a “funding gap” exists.

080502. No new obligations may be incurred unless they can be lawfully funded from prior appropriations or are specifically authorized by law.

080503. Unexpired funds of multi-year appropriations and no-year funds are not impacted by the absence of a new appropriation or a CRA.

0806 RULES OF OBLIGATION

080601. Obligating Current Year Funds for Prior Year Needs. Do not obligate current year funds for the needs of a prior year. If a requisition was not submitted in the prior year to satisfy a need in that prior year, and the need continues to exist in the current year, obligate current year funds.

080602. Unrecorded Prior Year Obligations. If an obligation had been incurred in the prior year and the obligation can be lawfully funded from prior year funds, but the obligation was not recorded during the prior year; use prior year funds to record the obligation.

080603. Severable Service Contracts.

A. Fund holders may obligate funds current when a severable service contract is signed for the amount of the contract provided the contract does not exceed 12 months. Fund holders may also split the obligation between fiscal years that the contract covers provided the contract does not exceed 12 months. Severable service contracts that exceed 12 months will be funded by appropriations of the fiscal years in which the services are rendered. In accordance with 10 U.S.C. 2396, an exception to funding severable contracts that exceed 12 months with appropriations current when services are rendered, is allowed in foreign countries where laws and customs require advance payments.

B. Option years are treated as new contracts. Therefore, when the severable service contract has renewal options, obligate funds for the basic period and any penalty charges for failure to exercise options per paragraph A above.

080604. Non-Severable Contracts. Obligate funds current when a non-severable (also referred to as "entire" or "single entity") contract is signed for the full amount of the contract. Non-severable contracts are for single undertakings in which the services to be received cannot be separated for performance in separate fiscal years. Training tends to be non-severable.

080605. Travel Orders. Cite next FY's appropriation on a temporary duty (TDY) order issued in the current FY for travel in the next FY. These orders will include a statement, "subject to availability of funds." Do not record obligations for the next FY in the current FY. There is an exception for military personnel which authorizes advance payments of certain permanent change of station (PCS) travel and transportation allowances according to 37 U.S.C. 303 of the Career Compensation Act of 1949. This exception pertains to do it yourself (DITY) moves.

080606. Protests. Per 31 U.S.C. 1558, funds available for 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 remain available for obligation for one hundred (100) calendar days, unless otherwise specified, after the date on which the final ruling is made on the protest. A ruling is considered final on the date on which a decision is rendered on such 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. As used in this paragraph, the term “protest” means any protest filed with the General Accounting Office (GAO) pursuant to 31 U.S.C. Chapter 35, Subchapter V. The term “protest” also means an action filed in court or under agency administrative procedures where that action involves:

A. A challenge to:

1. A solicitation for a contract;

2. A proposed award of a contract;

3. An award of a contract; or

4. The eligibility of an offeror or potential offeror for a contract or of the contractor awarded the contract; and

B. The action delays or prevents an agency from awarding a contract or proceeding with the procurement.

080607. Procurement of Information Technology.

A. In accordance with (IAW) 40 U.S.C. 1412(e), Department of Defense (DoD) activities may obtain information technology resources from GSA programs without relying on the Economy Act. The obligation is recorded at the time the activity enters into a binding written interagency agreement with the General Services Administration (GSA). New needs may not be added to an existing order and funded with expired funds unless deemed to be a within scope change to the original order.

B. Resource managers are assigned the responsibility to verify that Information Technology (IT) purchases have been validated by the Director of Information Management (DOIM) prior to assigning a funding citation. Requests that are not validated by the DOIM should be returned to the requesting activity with instructions to resubmit the purchase request through the appropriate technical review channels to obtain the necessary approvals and waivers.

080608. Supplies.

A. Record obligations for interfund transactions based on the Julian date of the supply requisition. During fiscal year-end, when items are ordered before September 30th, a miscellaneous obligation document (MOD) should be used to enter the estimated amount on the books of the current fiscal year. Ordering activities must modify or cancel open, unfilled requisitions prior to an appropriation's cancellation. If ordering activities determine a bona fide need still exists for the supplies or equipment, they must cancel the original requisition and process a new requisition. Since this is a new requisition using current year funds, the requisition will not be subject to the limitations for use of current year funds for payment of an obligation that would have been charged to a canceled appropriation.

B. Do not process requisitions once the supply system is closed for the fiscal year. Exceptions to this policy (By Pass Authority) can only be authorized by requests through command channels to Headquarters, Department of the Army (HQDA), Army G-4.

C. In situations where requisitions are canceled or rejected for causes beyond the requisitioner’s control, funds cited on the canceled or rejected requisition may be re-used for replacement requisitions, provided the funds have not canceled. The replacement requisition must be for a like item for which a bona fide need continues to exist. The supply status codes authorized for re-use are found in DoD 4000.25-1-m AP2.16. Use of funds resulting from cancellations due to any other supply status codes is not authorized. Note: The beforementioned referenced cancellation/rejection codes will be changed to logistics systems edit errors, which will allow the original transactions to be corrected and processed through the logistics system with the originally cited funds.

D. Record the receipt of credit for returned supply items against the funds current at the time the Inventory Control Point issued the materiel receipt status with an applicable advice of credit status code.

080609. Canceled Appropriations. Appropriations canceled pursuant to 31 U.S.C., Sections 1552, 1555, or 1557 are not available for new obligations. Adjustments may be made to canceled appropriations provided the transaction being adjusted occurred prior to the appropriation canceling. Canceling appropriations do not eliminate the Government's legal obligation to pay contractors for services rendered or products delivered. Nor does it nullify the need for the accounting activity to maintain an audit trail supporting the existing contingent liability to future appropriations. See Chapter 16 this regulation and the DoDFMR, Volume 3, Chapter 10 for limitations and additional guidance. Use unexpired funds available for the same general purpose to pay for obligations that would have been charged to the canceled account if done before the account canceled.

080610. U.S. Army Corps of Engineers (USACE) Contingencies.

A. When USACE performs construction, maintenance, and repair projects on a reimbursable basis, USACE may require an amount included on the order to cover unforeseen contingencies. This amount is determined by USACE and is applied on a percentage basis of the total order. The percentage may vary by geographic region. Ordering activities will obligate for these contingencies.

B. At fiscal year end, reduce contingency obligations to the actual obligations incurred by USACE. To accomplish this, USACE will advise the ordering activity in writing (message is acceptable) of the actual amount it has obligated for contingencies. This will be done not later than September 15 so that there is time to use the funds made available by this adjustment.

C. USACE will advise the ordering activity in writing of the amount it anticipates it will need in the succeeding fiscal year to cover any remaining anticipated contingencies considered to be "within scope contract modifications" to be obligated by the ordering activity. If the contract modifications are not within scope, the ordering activity will obligate contingencies citing current year funds. The exchange of letters or messages may be considered amendments to the original order to avoid the preparation of formal order amendments.

080611. Obligations for Prompt Pay Interest.

A. Prompt pay interest must be paid from the funds available for the administration of the program for which interest was incurred.

B. The appropriation to charge is usually an operations and maintenance appropriation. Interest cannot be charged to an appropriation, which does not fund operating costs, such as procurement, or military pay. Interest cannot be charged to the working capital fund (WCF) unless the purchase is for the express use of the WCF and not for a customer. Interest can be charged to Foreign Military Sales (FMS), but only to a specific line of accounting provided by DFAS.

C. Interest must be paid out of the year in which the interest starts accruing, even when the interest period crosses fiscal years. The interest payment is charged to the fiscal year of the day after the invoice payment due date (which is the day the agency incurred the obligation to pay interest). For example, if a payment due date falls in FY 2007 but payment is not made until FY 2008, interest will be paid from FY 2007 funds.

0807 RECORDING OBLIGATIONS

080701. Record obligations in the accounting classification cited on the obligating document. If the accounting classification is in error, request an amendment or contract modification.

080702. In accordance with the DoDFMR, Volume 3, Chapter 8, Paragraphs 081401 and 081402, during prevalidation accounting activities will record or adjust obligations to match the amount of the entitlement. All accounting activities will follow the procedures in referenced chapter.

080703. During the final two weeks of the fiscal year, accounting activities will not unilaterally record obligations on behalf of the fund holder. Accounting activities will coordinate with the fund holder to ensure all valid obligations are properly recorded.

080704. Adjust obligations for written changes if they are binding on the contractor without further action.

080705. Record obligations providing for a discount at the net price unless it is not cost effective, according to Treasury guidelines. If the servicing accounting system automatically deobligates the amount of the discount when the discount is taken, then record the obligation at the gross amount.

080706. Record obligations for International Military Education and Training (IMET), and Foreign Military Financing (FMF) funds when a reimbursable Military Interdepartmental Purchase Request (MIPR) is accepted. If a direct fund cite MIPR is used, the ordering activity will record obligations when the contract, travel order, etc. is received from the performing activity. Do not obligate an accepted MIPR that will be funded by a direct fund cite. Citing another installation’s funds does not constitute a financial obligation to the performer’s funds.

080707. Record all obligations even if the recording of the obligation results in the appropriation being over obligated. Notify the fund holder that a potential Anti-Deficiency violation may exist.

0808 PROCESSING OBLIGATION TRANSACTIONS

080801. The following are examples of methods for recording obligations: on-line input, electronic interface (including electronic data interchange (EDI) transactions), and hardcopy documentation.

080802. The accounting activity will ensure:

A. All interfacing systems are properly scheduled so all obligation transactions from feeder systems are properly recorded in the appropriate accounting month.

B. All obligation documents received by electronic interface, mail, or facsimile (FAX) from the fund holder are properly recorded in the appropriate accounting month.

080803. The fund holder will process on-line updating of obligation data when available. However, if on-line input is not available, the fund holder will ensure all obligation documents are forwarded by electronic means, mail, or FAX to the accounting activity.

*0809 ESTIMATED OBLIGATIONS

Obligations may be recorded based on estimates. When actual obligation amounts become known, reverse and replace estimated obligations with actual obligations, with the exception of incentive awards. The estimates and reversals are accomplished using Department of Defense (DD) Form 2406 (Miscellaneous Obligation Document) (MOD). Fund holders and accounting activities will jointly ensure that the actual obligation document is received to replace the MOD. For guidance on obligating incentive awards, reference DoDFMR Volume 3, Chapter 8, Paragraph 080901.

0810 SIGNATURES ON OBLIGATION DOCUMENTS

When signatures are required to validate obligations, sign the documents before the cited funds expire. Show the actual date of each signature. When more than one signature is required, record the obligation on the date of the last required signature.

0811 OBLIGATIONS FOR PROBLEM DISBURSEMENTS

081101. The timeframe for researching and resolving disbursements when the entitlement office and the accounting office are not co-located is 120 days (60 days for research and 60 days for the fund holder to record the obligation). The timeframe for researching and resolving disbursements when the entitlement office and the accounting office are co-located is 90 days (30 days for research and 60 days for the fund holder to record the obligation).

081102. Do not obligate credit balance unmatched disbursements (UMDs) unless they have been researched and determined to be legitimate.

081103. Do not record obligations in elements of resource (EORs) 4610, 4620, 4630, 4640, 4650 or 4660. Record obligations associated with these EORs in EOR 4601.

0812 OBLIGATION DOCUMENTATION

081201. Requirement. Documentary requirements for recording obligations are provided in 31 U.S.C. 1501(a). The remainder of this section lists typical types of obligation documentation and also provides suggested ways to control and/or validate the information on the obligation document. Do not record obligations without proper documentation. See DFAS Manual-IN 37-100-** for guidance on standard document number (SDN) formats.

* 081202. DD Form 2406 (Miscellaneous Obligation Document (MOD)). The MOD can be used as a temporary obligating document, see paragraph 0809, 081304 and 081305. Exception: For guidance on obligating incentive awards, reference DoDFMR Volume 3, Chapter 8, Paragraph 080901.

081203. Personnel Compensation and Benefits (Excluding PCS Costs).

A. Typical obligation documents are:

1. Payroll systems output.

* 2. DD Form 2406. This may be used to record obligations for new employees, projected overtime for a specific pay period, lump-sum leave, personnel cost transfers, and manual payroll costs. For guidance on obligating incentive awards, reference DoDFMR Volume 3, Chapter 8, Paragraph 080901.

3. Standard Form (SF) 50 (Notification of Personnel Actions).

4. Department of the Army (DA) Form 1256 (Incentive Awards Nomination and Approval).

5. DA Form 2441 (Suggestion Award Certificate).

B. Standards used to control/validate:

1. Ensure there is a valid standard document number (SDN).

2. Ensure number of unpaid but accrued workdays on monthly payroll MODs are correct.

3. Ensure totals on payroll MODs agree with DD Form 592 (Payroll for Personal Services-Certification and Summary) and are reversed out at the beginning of the subsequent month.

4. Ensure that payroll data is prepared, verified, and controlled for recording accrued payroll expenses into the accounting system.

5. Ensure cost transfers are accomplished using guidance in Chapter 16, Paragraphs 161801 – 161803 this regulation.

081204. Personnel Compensation and Benefits Associated with PCS.

A. Typical obligation documents are:

1. DD Form 1614 (Request and Authorization for DoD Civilian Permanent Duty Travel).

2. DD Form 2406. This may temporarily be used in advance of formal documentation that should follow within 30 days.

B. Standards used to control/validate:

1. Ensure there is a valid SDN.

2. Validate accounting classification, including EORs, to the purpose and scope of the orders. (See DFAS Manual 37-100-**).

3. Ensure all PCS orders include an authorization and an obligation for transportation of things (except for local moves).

4. Ensure orders contain proper fund cites.

5. Ensure estimates are reasonable.

6. Ensure there is a valid customer identification code (CIC) for overseas movements. See DFAS Manual 37-100-**.

081205. Compensation for Travel, Per Diem, and Transportation of Persons (Excluding PCS).

A. Typical obligation documents are:

1. DD Form 1610 (Request and Authorization for TDY Travel of DoD Personnel).

2. DD Form 652 (Meal Ticket).

3. SF 1164 (Claim for Reimbursement for Expenditures on Official Business).

4. SF 1169 (U.S. Government Transportation Request).

5. SF 1034 (Public Voucher for Purchases and Services Other Than Personal).

B. Standards used to control/validate:

1. Ensure there is a valid SDN.

2. Monitor document timeliness and maintain statistics by fund holder.

3. Monitor document quality for completeness and accuracy, returning those needing additional or corrected information. Maintain statistics on returned documents by fund holder.

4. File documents by the month travel commences if automated aging is based on accounting office's processing date.

5. Validate accounting classifications including EORs to the purpose and scope of the orders (see DFAS Manual 37-100-**).

6. Ensure travel order costs crossing fiscal years are properly prorated. (Note: "Subject to availability of funds" statement is required when spanning fiscal years).

7. Obligate travel orders for transportation provided by the Air Mobility Command when received from the appropriate budget office. The SDN will be created in accordance with DFAS Manual 37-100-**. The accounting activity will use this SDN to hold travel orders pending receipt of the Air Mobility Command bill from the Air Force via cross-disbursing.

081206. Transportation of Things (Except PCS Household Goods (HHG) shipments)).

A. Typical obligation documents are:

1. SF 1103 (U.S. Government Bill of Lading (GBL).

2. SF 1203 (U.S. Government Bill of Lading-Privately Owned Personal Property).

3. SF 1169 (U.S. Government Transportation Request).

4. DD Form 1155 (Order for Supplies or Services).

5. DD Form 1348-1 (DoD Single Line Item Release/Receipt Document).

B. Standards to control/validate:

1. Ensure there is a valid SDN.

2. Ensure that all GBLs, demurrage, and detention documentation are certified by the transportation officer.

3. Monitor timeliness of transportation documents.

4. Ensure bulk fund cites to transportation officers are fully obligated and adjusted based on receipt of SF 1169.

081207. Contracts.

A. Typical obligation documents by contract type are:

1. Leases and rentals.

a. DD Form 1155.

b. SF 33 (Solicitation, Offer, and Award).

c. SF 30 (Amendment of Solicitation/Modification of Contract).

d. DD Form 2406. This may be used to record obligations for contracts that have been let but hard copy document has not been received. Upon receipt of the hard copy document, reverse out the MOD and record the contract.

2. Printing and publication.

a. Government Printing Office (GPO) Form 2511 (Print Order).

b. GPO Form 1026A (Print Order for Marginally Punched Continuous Forms).

c. DD Form 282 (DoD Printing).

d. SF 1 (Printing and Binding Requisitions).

3. Communications and utilities. The usual obligation document is DD Form 2406 pending receipt of contract or other permanent document.

4. Reimbursable services.

a. DD Form 448-2 (Acceptance of Military Interdepartmental Purchase Request).

b. DD Form 1144 (Support Agreement).

c. Memorandum of Agreement (MOA).

d. Memorandum of Understanding (MOU).

5. Types of purchase orders.

a. SF 33.

b. SF 30.

c. DD Form 1155.

d. SF 44 (Purchase Order-Invoice-Voucher).

6. Types of delivery orders. Usually DD Form 1155.

7. Miscellaneous contracts.

a. SF 33.

b. SF 30.

c. SF 182 (Authorization, Agreement Certification of Training).

d. DD Form 448-2. When a direct fund cite is used, the performing activity will provide a copy of the contract or other obligating document to the ordering activity. This will provide the documentation required to record the obligation. If not using direct fund cite, the ordering activity will obligate upon receipt of the accepted DD Form 448-2.

e. Letter Contracts or Letters of Intent.

B. Standards used to control/validate are:

1. Leases and rentals.

a. Ensure there is a valid SDN.

b. Ensure input into correct month and fiscal year.

2. Printing and reproduction.

a. Ensure there is a valid SDN.

b. Ensure that obligation documents contain proper accounting classifications and properly distinguish between inside or outside the U.S. Government.

3. Communications and utilities.

a. Ensure there is a valid SDN.

b. Ensure that MODs are adequately supported with documentation for estimates applicable to specific accounting periods.

4. Reimbursable services.

a. Ensure there is a valid SDN.

b. Ensure obligation documents contain the name and phone number of the point of contact to determine status.

c. Ensure that obligation documents reflect signatures and dates. DD Forms 448 generated by Corps of Engineers automated system will contain an electronic authentication and will not have a handwritten signature.

5. Purchase orders.

a. Ensure there is a valid SDN.

b. Ensure documents are coded according to obligation rules and in an amount net of discount, if warranted.

c. Ensure proper approval on documents.

6. Delivery orders.

a. Ensure there is a valid SDN.

b. Ensure that a contractual agreement (Requirements Contract) has been negotiated and signed before processing a delivery order.

c. Ensure that the contract number and the number on the delivery order agree.

d. Ensure that if there is a discount involved, the obligation is recorded net of discount.

7. Miscellaneous contracts.

a. Ensure there is a valid SDN.

b. Record transactions according to obligation rules specified in this chapter and the DoDFMR, Volume 3, Chapter 8. Record net of discount, if warranted.

c. Ensure validity of the coded fund cite.

081208. Supplies and Materiels (Non-Automated Requisitions).

A. Types of obligation documents used are:

1. DD Form 1155.

2. SF 44.

3. SF 33.

4. SF 30.

B. Standards used to control/validate:

1. Ensure there is a valid SDN.

2. Record amounts net of discounts, if warranted.

3. Ensure proper certification and signature on documents.

4. Check unit amounts on orders for reasonableness. Contact activities on questionable items before processing.

081209. Supplies and Materiels (Automated Supply Systems).

A. Typical documentation includes:

1. Obligation, accrual, and disbursement data created from an automated interface between the logistics system and the consumer fund accounting system. This includes on-post customers.

2. Obligation, accrual, and disbursement data from manual documents generated to supplement the various automated systems.

B. Standards used to control/validate:

1. Ensure there is a valid SDN.

2. Ensure that automated interfaces utilize the most current data files for each cycle. With the lack of physical documentation for the automated supply transactions, the verification of input and balance forwarded data is imperative.

3. Post acquisition authority by materiel category, as approved.

4. Clear prior-cycle rejected transactions on a daily basis in coordination with supply activities.

5. Research and clear suspense transactions within 120 days.

6. Ensure that financial code table files are accurate.

7. Process bills on time and against current unbilled transactions.

081210. EDI Transactions. Obligations can be recorded based on EDI transaction.

0813 FORWARDING DOCUMENTATION TO ACCOUNTING ACTIVITY

081301. Serviced activities that do not have access to automated obligation systems will forward required obligating documents to the servicing accounting activity within six calendar days after the documents are completed. At fiscal year end, the required obligating documents should be forwarded as soon as possible, but no later than September 30th.

081302. Serviced activities transmitting obligation transactions to the accounting activity via automated systems interfaces or via direct system access will not send the hard-copy documents to the accounting activity. The fund holder will retain these documents IAW the DoDFMR, Volume 1, Chapter 9 and DFAS 5015.2-M, Records Disposition Schedule.

081303. Serviced activities that make direct input to automated accounting files, will enter transactions within 10 calendar days following date obligation is incurred, except at month-end when input must be made by the accounting activity established cutoff date.

081304. In the absence of a normal obligating document, the fund holder will prepare interim documentation. A miscellaneous obligation document may be used for this purpose. Interim documentation will include at a minimum:

A. Document number and date the authorizing officials signed the obligating document.

B. Contractor's name and address.

C. Actual or estimated amount.

D. Quantity and/or description of items or services being procured.

E. Complete accounting classification.

F. Statements that all required signatures have been obtained and the obligating document has been sent or estimated date that it will be sent.

081305. Use a DD Form 2406 to record valid obligations for which the proper obligating source document is currently not available. The DD Form 2406 may be used to obligate supply requisitions if supported by the obligating source document (for example, for supply requisitions, DD Form 1348-1 (DoD Single Line Item Release/Receipt Document), that have been processed by the area's servicing stock record officer. (NOTE: DA Form 2765-1 (Request for Issue or Turn-In) is a commitment document, not an obligation document. This is also true for DA Form 3953, Purchase Request and Commitment.) Do not use MODs to record obligations until the following information, as a minimum, is provided and included:

A. Identification of the proper existing, but currently unavailable, obligation document.

B. Identification numbers of the proper obligating source document, date the source document was signed, and the amount.

C. Other pertinent facts necessary to specifically identify the obligation.

0814 RECONCILING ELECTRONIC INTERFACES OF OBLIGATION TRANSACTIONS

081401. The accounting and serviced activities are jointly responsible for reconciling the electronic interfaces of obligation transactions.

081402. The accounting activity will advise the fund holder of any noted problems.

081403. The fund holder will:

A. Ensure all known obligation transactions are input on-line or transmitted to the accounting activity, correctly and timely for inclusion in the accounting records.

B. Retain the source documentation IAW the DoDFMR, DoDFMR, Volume 1, Chapter 9 and DFAS 5015.2-M, Records Disposition Schedule.

0815 OBLIGATION ADJUSTMENTS IN EXPIRED ACCOUNTS

081501. See the DoDFMR, Volume 3, Chapter 10 for additional information.

081502. Army activities will not exceed approval levels established in the DoDFMR without permission from HQDA. The fund holder will send requests for approval to the Assistant Secretary of the Army (Financial Management and Comptroller), Budget Execution and Policy Division, ATTN: SAFM-BUC-E, Room 3B680, 109 Army Pentagon, Washington, DC 20310-0109. The requests will contain the following documentation:

A. Appropriation (department, fiscal year, and basic symbol).

B. Program, project, or activity.

C. Amount of adjustment (dollar value, standard document number, and contract/modification number).

D. Include contract number, name of contractor, purpose of contract, and synopsis of additional work required by contract change. Written documentation supporting these charges/adjustments as a legitimate use of expired appropriations. "Within scope change" will require interpretation by legal counsel and/or a contracting officer at the local level. This statement will include the name, title, and telephone number of the individual making this determination.

E. Original value of the obligation.

F. Date of original obligation.

G. Amount of prior upward adjustments and recoveries by fiscal year.

H. Justification for use of expired funds for the proposed restoration, including legal and policy reasons.

I. Statement of the cumulative total of approved change requests for the "program, project, or activity," including this request, in current fiscal year.

J. The request for approval shall contain the statement: "Sufficient justification and documentation is retained at this headquarters and/or subordinate activities."

K. Army activities must realize it will take time to prepare the request, coordinate, provide to DoD Comptroller, and receive approval back. The Army Budget Office (ABO) will obtain all appropriate Army staff/Secretariat coordinations and submit the request with the documentation attached to the DoD Comptroller for review and approval within 30 days. ABO will notify the Army activity of approval or disapproval. Army activities will include approvals and retain complete documentation including required statements for future review and audit.

L. Obligations will not be recorded until approval is received by HQDA.

0816 RECORDING OBLIGATION ADJUSTMENTS

081601. The accounting activity and fund holder are jointly responsible for ensuring necessary adjustments are made to obligations. However, IAW the DoDFMR, Volume 3, Chapters 8 and Chapter 11, under certain conditions the accounting activity will record obligation adjustments. Maintain supporting documentation for obligation adjustments either at the accounting activity or the fund holder.

081602. The fund holder will:

A. Use electronic interface to input contract modifications. Automated interfaces from the standard contracting system should accomplish most adjustment requirements. If the electronic interface does not adjust obligation in the accounting system, then the fund holder must record the obligation adjustment or request the accounting activity to do so.

B. Make maximum use of on-line input and electronic interfaces when making input from hardcopy source documents. Where no electronic interface exist, the fund holder will use mail or FAX capabilities to submit obligation documents to the accounting activity for input.

C. Provide a point of contact (POC) to the accounting activity for resolving problems with contracting, logistics, engineering, and other functional activities.

081603. The accounting activity will:

A. Perform research as necessary and required by the DoDFMR, Volume 3, Chapter 11 and obtain assistance from fund holder as needed.

B. Schedule appropriate reconciliation cycles between the logistics systems and the accounting systems. The accounting activity will provide prompt results to the fund holder, as required.

C. Make maximum use of liquidation coding procedures when processing disbursements/collections and/or during partial payment/final payment reviews to verify unliquidated obligations (ULOs) retained in the accounting database.

081604. Major problems requiring more than routine courses of action will be coordinated between the accounting and fund holder.

081605. During the final two weeks of the fiscal year, accounting activities will not unilaterally record obligation adjustments on behalf of the fund holder. The accounting activity will coordinate with the fund holder to ensure all valid obligations are properly recorded. The Operational Data Store (ODS) matching process may be on hold for a period of time close to fiscal year end.

0817 FOREIGN CURRENCY FLUCTUATION PROGRAM OBLIGATIONS

081701. Not all appropriations are eligible to participate in the foreign currency fluctuation (FCF) program. See the DoDFMR, Volume 3, Chapter 8 and Volume 6A, Chapter 7 for additional guidance. For those appropriations that participate in the FCF program, the obligation will be recorded at the budget execution rate in effect at the time the appropriation was approved. The Office of the Secretary of Defense (OSD) publishes budget execution rates at the beginning of each FY. If the new budget execution rates are not published by the start of the new FY, continue to use the previous FY's rates until the new rates are published. When the new rates are published adjust the obligations that have been recorded accordingly.

081702. Include the type of currency and the budget rate on the obligating documents. Use the foreign currency code (see DFAS Manual 37-100-**) in lieu of the inside/outside U.S. Government data code.

081703. Foreign currency fluctuation procedures do not apply when the performing activity is funded by the Defense Working Capital Fund (DWCF).

081704. Certain contracts for fixed U.S. dollar amounts contain a clause providing for disbursements in foreign currency at the exchange rate current on the date of disbursement. The U.S. dollar amount paid is the same fixed amount, but U.S. dollars are converted to foreign currency at the time of payment. While the contract is payable in a foreign currency, the value of the contract itself is not based on a foreign currency or an exchange rate. The gain or loss on exchange is shifted to the payee/contractor. Contracts of this type are not included in the foreign currency fluctuation accounting process.

0818 SECTION 3732 AUTHORITY

081801. See the DoDFMR Volume 3, Chapter 12 for additional information.

081802. This authority will be administered by using the Program and Budget Accounting System (PBAS).

081803. The commander authorizing the over-obligation will prepare a written report, in letter form, and forward it through command channels to the Assistant Secretary of the Army (Financial Management and Comptroller), Budget Execution and Policy Division, ATTN: SAFM-BUC-E, Room 3B680, 109 Army Pentagon, Washington, DC 20310-0109, to arrive not later than 10 days after the end of the month in which the over-obligation occurred. The report will contain a summary of all pertinent facts including:

A. Name of installation or organization and date the over-obligation occurred.

B. Accounting classification of the funds involved.

C. Amount of over-obligation.

D. Description of the cause and circumstances which warranted the emergency circumstances.

E. Date funds were received to cover the over-obligation.

F. Listing of items procured (for example, clothing, subsistence, fuel, quarters, transportation, or medical supplies).

0819 RECOVERIES

A prior year transaction that merely moves an obligation within the same FY, Basic Symbol (BS), Limit, Operating Agency (OA), and Allotment Serial Number (ASN), and which nets to zero, should be treated as a credit obligation, not a recovery/deobligation. This includes payroll and contract MODs. These are transactions that do not reduce the overall amount of obligations. A prior year downward adjustment of a previous obligation should be recorded as a recovery. These are transactions that actually reduce the overall amount of obligations. Prior year includes any year that is not the current year, including unexpired appropriations not in the initial year of availability, as well as expired appropriations and X year appropriations with a prior program year. The amount of recoveries may not exceed the amount obligated in the prior years; i.e., you may not deobligate more than has been obligated through out the life of the appropriation. Appropriation 8927 (Gift Fund) is an exception to the requirements of this paragraph. Do not offset prior year recoveries with correction of prior year accounting errors. Record each type of transaction separately.

0820 REDUCING LIABILITIES AND RELATED OBLIGATIONS

082001. The policies in this paragraph may be used for reducing certain liabilities and related obligations. The requirements common to all such transactions are as follows:

A. Do not reduce the obligation if the contractor, U.S. Government activity, or individual has an outstanding advance related to the obligation.

B. Reserve a portion of the unobligated funds generated within each appropriation for valid invoices, bills, or vouchers received after write-off. Establish a 40 percent reserve until local experience dictates otherwise.

082002. For contracts or purchase orders placed with commercial vendors, liabilities and related obligations may be reduced if:

A. Goods or services were received but no invoice or statement was received for at least 180 days from the date of acceptance of the goods or services; and

B. At least two written requests were made by the Vendor Pay Office for an invoice during the 180 days and the second request is dated at least 60 days before the reduction of the liability and obligation; and

C. Copies of the request are on file in the Vendor Pay Office. These requests must be addressed to the vendor. When the paying and accounting activities are different, the paying activity will request invoices and provide copies to the funded fiscal station. The Vendor Pay Office will notify the servicing accounting activity and the fund holder when there is no response from the vendor.

082003. The authority to reduce the liability and obligation does not allow closing the related contract files in either the purchasing and contracting office or the vendor pay office.

082004. For orders or agreements with U.S. Government activities, liabilities and related obligations may be reduced if:

A. Goods or services were received but no bill was received for at least 180 days from the acceptance date of the goods or services; and

B. At least two written requests were made for a bill during the 180-day period and the second request is dated at least 60 days prior to the reduction of the liability and obligation; and

C. Copies of the request are on file in the servicing accounting activity; and

D. There are no uncleared intransit disbursements with the billing office.

082005. For Military Standard Requisition and Issue Procedures (MILSTRIP) requisitions, liabilities and related obligations may be reduced if the following occurs: (See Chapter 20 for interfund procedures.)

A. Materiel was received and no interfund bill or its equivalent was received for at least 180 days from the date of materiel acceptance; and

B. For Intra-Army billings only, during the 180-day period at least one request for billing adjustment and one follow-up request for billing adjustment were submitted using methods available (e.g., E-mail). The follow-up request must have been submitted at least 60 days prior to the date of reducing the liability; and

C. Copies of the request for billing adjustment and follow-up request are on file in the servicing accounting activity.

D. No line item for the same requisition number is in the accounting activity's suspense account (21F3885).

082006. For travel orders, estimated liabilities and related obligations may be reduced if:

A. No travel voucher was received for at least 180 days after the estimated completion date of the travel; and

B. At least two written requests during the same 180-day period were sent by the fund holder or Travel Pay Office to the traveler requesting that a voucher be submitted, with the second request sent at least 60 days prior to reducing the liability and obligation; and

C. Copies of the request are maintained by the fund holder or Travel Pay Office.

D. The above does not apply if a travel advance was paid. The advance must be recouped in accordance with Chapter 17.

082007. Reducing the obligation does not mean the entitlement ceases to exist. The payee may still be authorized the entitlement if proper documentation is provided.

|BASIS FOR RECORDING OBLIGATIONS |
|Contract Type |Appropriation |Basis for |Obligation Amount |
| |Year |Recording |(note 1) |
| | |Obligation | |
|1. Government Charge Card |Current |Historical |Estimated monthly purchases. |
|(non-CARE) | | | |
|2. Cost Reimbursable |Current |Contract Award |Full Amount |
|3. Cost-Plus-Fixed-Fee |Current |Contract Award |Full amount of contract, including the fixed fee. |
|4. Cost-Plus-Incentive-Fee |Current |Contract Award |Full amount of contract, including the incentive fee. |
|5. Cost-Plus-Award-Fee |Current | Contract Award |Full amount of contract, not including the award amount. |
| | | |Obligate award when determined that award will be paid. |
| | | |Obligation for award is against same appropriation and FY used|
| | | |for contract. |
|6. Cost Reimbursable with |Current |Contract Award and|Minimum liability of the U.S. Government when contract |
|Delivery Orders | |delivery orders |awarded. Obligate additional funds over minimum for each |
| | | |order when placed. |
|7. Firm Fixed Price |Current |Contract Award |Full Amount |
|8. Firm Fixed Price with |Current |Contract Award |Target Amount |
|Escalation Clause | | | |
|9. Indefinite Delivery, |Current |Contract Award |When contract is awarded obligate minimum liability of U.S. |
|Indefinite Quantity | |and delivery |Government. |
| | |orders |Obligate additional funds over minimum for each order when |
| | | |placed. |
|10. Indefinite Delivery, |Current |Contract Award |Full amount for quantity required in current year. |
|Definite Quantity | | |(see note 2) |
|11 Job Order |Current |Contract Award |Minimum liability of U.S. Government and delivery orders in |
|Contracts | | |excess of the minimum liability. |
|12. Letter Contract |Current |Upon Issuance |The amount of maximum legal liability. (see note 3) |
|13. Letter Contract |Current |When |Adjust the recorded obligation to equal the contract amount. |
| | |Definitized | |
| | |(see note 4) | |
|14. Non-severable contract. |Current |Contract Award |Full amount unless restricted by other obligation rules. |
|(see note 5) | | | |
|15. Purchase Order $100,000 and|Current |Upon Issuance |Full Amount |
|less. | | | |
|16. Purchase Order over |Current |Upon written |Full Amount |
|$100,000. | |acceptance or | |
| | |constructive | |
| | |acceptance based | |
| | |on delivery | |

Table 8-1

|Contract Type |Appropriation |Basis for |Obligation Amount |
| |Year |Recording | |
| | |Obligation | |
|17. Requirements |Current |Delivery Order |Amount of delivery order |
|18. Reserve Officer Training |Current/Next Subject to|Completion of 45 |Full amount of the contract for the academic year. |
| |fund availability |day period during | |
| | |1st yr | |
|19. Severable contracts: | | | |
|a. contract for services not |a. Current |a. Contract Award |a. Full amount of contract or amount necessary to fund to end |
|to exceed 12 months. | | |of FY. Remainder of contract can be obligated with next |
| | |b. Contract Award |year's funding. |
|b. contract exceeds 12 months.|b. Current | |b. Current year funds in an amount necessary to fund the |
|(see note 6) | | |contract to the end of current FY. Remainder of contract must|
| | | |be obligated with funds current the following FY. |
|20. Subscriptions/ |Current |Contract Award |Full Amount for subscription periods offered by the vendor |
|periodicals | | |(see note 7). |
|21. Time and Material |Current |Contract Award and|Minimum liability of U.S. Government exclusive of permitted |
| | |Delivery Orders |variations. Obligate additional funds for each delivery order|
| | | |when order is placed. |
|22. Training in a civilian |Current |Contract Award |Full Amount |
|institution when training | | | |
|begins and ends in the current | | | |
|FY | | | |
|23. Training in a civilian |Current |Contract Award |Full Amount |
|institution when training | | | |
|begins in the current FY but | | | |
|ends in the next FY | | | |
|24. Training in a civilian |Current |Contract Award |Full Amount |
|institution when all of the | | | |
|following conditions exist -- | | | |
|(see note 8) | | | |
|a. Training begins within the | | | |
|first 90 days of the next FY, | | | |
|and | | | |
|b. Training is not readily | | | |
|available from other sources, | | | |
|(see note 9) and | | | |
|c. Institution requires a | | | |
|non-cancelable | | | |
|con-tract/advance payment | | | |
|before the end of the current | | | |
|FY to reserve a space in the | | | |
|course or to pay for | | | |
|instructors. | | | |

Table 8-1 (continued)
Notes:
1 Obligate contracts net of discount unless system automatically reduces obligation when discount taken.
2 Delivery is required in current FY but not necessarily deliverable by the contractor in the current FY.
3 Letter contracts are superseded upon definitization, and the total cost of the definitized contract, less either the actual costs incurred under the letter contract (when known), or the maximum legal liability permitted by the letter contract (when actual costs cannot be ascertained), is obligated against the appropriation current at the time the parties enter into the definitized contract.
4 Definitized means when the total contract costs are determined.
5 Non-severable contracts are for single undertakings. For example, painting a building.
6 Severable contracts, for purposes of performance, are continuing and recurring in nature, such as for rents or for performance of purely personal services with compensation fixed in proportion to the amount of work performed.
7 Per 31 U.S.C. 3324, this includes “Charges for a publication printed or recorded in any way for the auditory or visual use of the agency.”
8 Tuition payments can be made in advance during the current FY only if the obligation is also properly chargeable to the current FY. Making advance payments to obtain discounts for obligations properly chargeable to the next year’s funds is specifically prohibited by 31 U.S.C. 3324.
9 Courses meeting this requirement are generally only offered once a year and options for similar courses meeting the same training requirement are not available.

Table 8-1 (continued)

| |
|OBLIGATIONS FOR INTRA-GOVERNMENT AGREEMENTS |
|If the obligation is for - |Obligate - |
|1. a project order (4 U.S.C. 23), or an Economy Act (31 U.S.C. 1535) |the amount of the order using funds current when the performing |
| |agency accepts it. |
|2. an order to another military department accepted as direct |the contract or other obligating document citing ordering activity's |
|citation procurement, |current funds when received from the performing activity who |
| |issues/awards a contract or other obligating documents citing |
| |ordering activity's current funds, not when the MIPR is accepted. 1, |
| |2 |
|3. an order issued to another U.S. Government agency as required or |the amount of the order using funds current when the order is issued.|
|authorized by law. 3 | |
| Notes: |
| |
|1 The performing activity will forward obligation documents to the issuing activity when the direct fund cite method is used. The issuing|
|activity cannot obligate funds until these documents are received. |
| |
|2 If the amount of the contract or other obligating document is less than the amount on the MIPR, then only obligate the amount of valid |
|obligations incurred; not the total amount cited on MIPR. |
| |
|3 Required by law means orders must be placed with a particular agency. There are no other options. authorized means there are other |
|options for agencies. (For example, some other statutory authority which exists other than the Economy Act.) They may place orders with the|
|U.S. Government agency, such as GSA, or order through other channels. |
| |
| |

Table 8-2

| |
|OBLIGATIONS FOR MILITARY PERSONNEL SERVICES AND BENEFITS |
|If the obligation is for - |Obligate - |
|1. pay and allowances of active duty personnel, including those on |in the month entitlement is earned using current funds based on |
|active duty for training (ADT) for more than 30 days, including |current information on pay rates and allowances applied to current |
|miscellaneous payroll items (e.g. quarters allowances, subsistence, |strength and on statistical reports. |
|etc.), | |
|2. the U.S. Government's share of Federal Insurance Contribution Act |in the same period as the related earnings. |
|(FICA) taxes, | |
|3. pay and allowances of annual training (AT) personnel or those on |entitlements earned in the month training begins, based on individual|
|ADT for 30 days or less, |or group AT or ADT orders, limiting obligations in any FY to training|
| |performed in that FY. |
|4. meal checks |funds current when bank bills DoD for their services. Do not |
| |obligate when meal check is issued to individual. |
|5. subsistence (mess hall meals and rations) in kind, |when ordered using current funds based on either written estimates of|
| |the cost of subsistence furnished by others under cross-servicing |
| |agreements and contract feeding, or evidence of payments for garrison|
| |rations. |
|6. enlistment/reenlistment bonuses, |funds current in the month entitlement is earned. 1,2, |
|7. annual leave, |in month leave is taken using current funds. |
|8. clothing, |record in month purchased using current funds. If reimbursing |
| |service member for purchase of clothing, record obligation in month |
| |service member incurred the expense using funds current at that time.|
|9. apprehension and delivery of deserters, prisoners and AWOL |record in month expenses incurred using current funds. |
|members, | |
|NOTES: |
| |
|1 Approving official certifies service member met requirements for earning the bonus as of that month. Obligate funds current as of that |
|month. (Examples: (a) Service member successfully completes requirements for bonus in August. Approving official certifies in August that |
|requirements were completed and entitlements were earned in August. Obligate fiscal year funds current for the month of August. (b) Service|
|member completes requirements for earning the bonus in August. However, approving official does not certify until November that |
|requirements were completed and the entitlement to the bonus was earned in August. Obligate fiscal year funds current for the month of |
|August. (c) Service member is projected to complete requirements for earning the bonus in August, however, requirements for earning the |
|bonus are not completed until November, the following fiscal year. Approving official certifies in November that requirements were |
|completed and entitlement to the bonus was earned in the month of November. Obligate fiscal year funds current in the month of November.) |
| |
|2 Specific authorization must be included in the DoD Authorization Act each fiscal year before bonuses can be paid. |

Table 8-3

| |
|OBLIGATIONS FOR CIVILIAN PERSONNEL SERVICES |
|AND SEVERANCE PAY |
|If the obligation is for - |Obligate - |
|1. civilian salaries, wages and fringe benefits,1 |when earned including month-end accruals. |
|2. accrued annual leave, | |
|a. Non-WCF |a. when leave is taken. |
| | |
|b. WCF |b. when earned or advanced. |
|*3. other items such as uniform allowances, allowances for foreign | |
|national employees (for example, seasonal bonuses) | |
| |in the month of entitlement. |
|4. lump sum for annual leave payment - non WCF, |funds current on the date of separation/retirement. |
|5. voluntary separation incentive program (VSIP) and voluntary early |funds current when employee accepts and signs the agreement. |
|retirement agreement (VERA), | |
|6. severance pay and the employee is - | |
| | |
|a. a U.S. civilian paid from appropriated funds, |a. obligate when due and payable, regardless of when disbursed. If |
| |paid on a pay-period by pay-period basis, record an obligation each |
| |pay period. If paid in lump sum, record the entire amount when due. |
| | |
| |b. obligate allowances as earned, on a pay-period by pay-period |
|b. a foreign national (non-U.S. citizen) paid from appropriated |basis, based on the governing Status of Forces Agreement (SOFA), |
|funds, |Master Labor Agreement, or other host-nation agreement.2,3, 4 |
|Notes: |
| |
|1 The obligation is usually based on the most recent pay period disbursement amount. |
| |
|2 Do not obligate appropriated funds for separation allowances earned by foreign national employees during periods of employment by |
|nonappropriated fund instrumentalities (NAFIs). |
| |
|3 If a foreign national employee transfers from one service component to another, then the losing component is liable for the accrued |
|adjusted separation allowances up to the time of separation, including all subsequent fluctuations in the foreign currency exchange rate |
|applicable to those funds accrued until transfer. The gaining service is responsible for all other costs. |
| |
|4 If a foreign national employee transfers within DA, then the losing organization sends the gaining organization an SF 2806 (Individual |
|Retirement Record) stating the separation allowance that accrued to the employee from his/her date of employment to his/her date of |
|transfer. The gaining organization becomes responsible for all severance pay earned. |

Table 8-4

| |
|OBLIGATIONS FOR TRAVEL AND TRANSPORTATION |
|If the obligation is for - |Obligate - |
|1. Temporary Duty (TDY) - |not later than the month in which the travel |
| |begins for - |
| | |
|a. transportation, |a. the total estimated cost of the travel. 1 |
| | |
|b. per diem allowances and other reimbursable costs, |b. either the estimated costs on a monthly accrual basis, or the |
| |total estimate before the travel starts. 2,3 |
| | |
|c. under blanket travel orders with an indefinite itinerary, |c. the estimate of travel expenses to be incurred in the month. |
|2. permanent change of station (PCS) for - |funds current - |
| | |
|a. civilian personnel. |a. when PCS orders are issued, includes reimbursable expenses such as|
| |estimates for per diem, real estate expenses, Relocation Income Tax |
| |Allowance (RITA), temporary subsistence, relocation services, or |
| |transportation requests and GBLs expected to be issued. |
| | |
| |b. in the month orders are issued for cost for travel and |
|b. military personnel. |transportation of the soldier and family members, dislocation |
| |allowance, and separation travel allowance. |
| | |
| |when the commercial carrier picks up the household goods if the |
| |government ships the household goods/POV/trailer. |
| | |
| |when orders are issued if the service member ships the household |
| |goods/POV/trailer. |
|3. commercial storage of HHG, |funds current when service is rendered . If storage crossed fiscal |
| |years, split obligation and costs between fiscal years. |
|4. a U.S. Government bill of lading (GBL), and transportation is |expected cost of the transportation to be furnished from funds |
|separate from the purchase contract, and the carrier accepts the |current when the carrier accepts the property. |
|property in a later FY, | |
|5. temporary quarters and subsistence allowance, |funds current in the month orders are issued. |
|6. pet quarantine fees, |funds current in the month orders are issued. |
|7. annual round trip for dependent student, |funds current in the month travel occurs. |

Table 8-5

| |
|OBLIGATIONS FOR TRAVEL AND TRANSPORTATION |
|Notes: |
| |
|1 All other costs are obligated in the FY incurred, for example, if a POV is used, obligate funds current when travel is performed. This |
|applies equally to an annual appropriation and the final year of a multi-year appropriation. |
| |
|2 Use the latter method for TDYs of 30 days or less. |
| |
|3 When started in one FY and finishing in another FY, obligate estimated costs to be incurred in each of the applicable FYs. |

Table 8-5

|(MISCELLANEOUS RULES |
|If the obligation is for - |Obligate - |
|1. a loan agreement, |the amount of the loan to be made. |
|2. a grant or subsidy, |the actual amount of the grant or subsidy payable. |
|3. a liability from pending litigation: | |
|a. if the government is definitely liable and the litigation is just|a. current funds in the amount of the expected liability. |
|to determine amount of liability, | |
|b. if litigation is to determine the government's |b. current funds when the government's liability is determined. |
|liability, | |
|4. a valid judgment, |funds current when the judgment is rendered. |
|5. a claim payable by law, |when the claim is approved. (see note 1) |
|6. other legal liabilities of the U.S. Government, |based on documentation or legal determination. |
|7. public utilities (that is, electricity, gas, water, telephone), |funds current in the month the billing period ends, even if the |
| |billing period is split between FYs. |
|8. IMET/FMF training orders, |funds current when either funded orders or valid travel |
| |authorizations are issued. (see note 2) |
|9. items bought by an imprest fund, |Funds current when the imprest fund is reimbursed. Imprest funds |
| |should be reimbursed at year-end. |
|10. interest-penalty charges under Prompt Payment Act (PPA), |funds available for administration of the program for which interest |
| |was incurred. Interest must be paid out of the year in which |
| |interest starts accruing. |
|11. contract ratification, |when the U.S. Government's liability was incurred. |
|12. a materiel requisition, |funds current when the requisition is submitted/placed by the area's |
| |servicing stock record officer. |
|13. settlement of a claim arising out of an original undertaking or |funds available at the time of original undertaking. |
|resulting from a within-scope change, | |
|14. settlement of a claim arising out of a change-in-scope change to|funds available and charged for the change-in-scope. |
|the original contract, | |
|15. reimbursement to Judgment Fund for Contract Disputes Act of |funds current at the time of the judgment. Expired funds that were |
|1987/Armed Services Board of Contract Appeals judgments, |current at the time of the judgment may also be used. This will not |
| |result in an Antideficiency Violation. (63 Comp Gen 308, 1984). |
|16. contract litigation costs, if separately stated in the settlement|funds current at the time of settlement or award. (28 U.S.C. 2412 |
|agreement or as a result of judgment, |(D)(4)); 5 U.S.C. 504. |
|17. Liabilities evidenced by expenditure documents, |the amount of the invoice/bill paid. The invoice/bill may be used as |
| |the obligating document. |
|Notes: |
|1. When final approval is required at a higher level than the funded installation and the amount approved exceeds the installation's |
|available funds, defer recording the obligation until enough funds are received to cover the increased amount. This is not an |
|Antideficiency Violation. |
|2. Obligate funded IMET orders when issued using funds cited on the order regardless of when the travel or training starts. Funded IMET |
|orders cannot be used to obligate funds of succeeding FYs. Adjust obligations based on actual student input and travel/living costs. |

Table 8-6

|OBLIGATIONS FOR ADJUSTMENTS |
|If adjustment is - |then - |
|1. for increases in a cost reimbursement contract that exceed the |obligate funds current at time price increase is granted. |
|original contract ceiling price and are not based on an antecedent | |
|liability enforceable by the contractor, | |
|2. for increases or decreases to a contract resulting from decisions|obligate funds originally cited if the amendment does not change the |
|under 50 U.S.C. 1431-1435 correcting mistakes or formalizing informal|scope of the contract. Obligate funds current at time amendment is |
|agreements, (see note 1) |executed, if the amendment changes the scope of the contract. |
|3. for a contingent obligation, such as one existing under |obligate funds originally cited on the contract. Record the |
|indemnification clause involving an equitable adjustment; (see note |obligation in the amount of the contractual liability when the |
|2), |amendment fixing the obligation is executed. If no amendment is |
| |required, the adjustment is recorded as an obligation when the event |
| |occurs that fixes the amount of the liability. |
|4. a within scope change to a contract, |obligate the original funds cited on contract for increased amount. |
| |For contracts funded by the MILCON appropriation, the within scope |
| |change may be funded from the funds available for obligation at the |
| |time the initial contract was awarded. This includes all five years |
| |of funds available at the time the contract was awarded unless the |
| |funds have closed. If original funds have closed, use current funds.|
|5. a change in scope to a contract, |obligate funds current when amendment is executed. |
|6. a within scope contract modification for a Defense Environmental |obligate one of the following: |
|Restoration program contract citing Defense Environmental Restoration|a. the prior-year account that funded the original contract if funds|
|Activities (DERA) funds transferred to operation and maintenance, |remain in that account, or |
|Army (OMA). |b. the current appropriation account that is available for the same |
| |purpose as the account that funded the original contracts if no |
| |prior-year funds are available. |
|7. for a contract terminated for the convenience of the U.S. |adjust the recorded obligation to anticipated settlement costs. |
|Government, | |
|8. for a contract terminated for contractor default and for a |obligate funds originally cited (unless original funds closed) to |
|contract terminated for convenience of the government when the |fund a replacement contract, provided all the following conditions |
|termination for convenience is the result of a court order, a |are met: |
|determination by other competent authority (such as a Board of |a. original contract was made in good faith; |
|Contract Appeals, GAO, or contracting officer) that the original |b. a continuing bona fide need still exists for the goods or |
|award was improper, |services ordered; |
| |c. replacement contract is substantially of the same size and scope |
| |as the original contract; |
| |d. replacement contract is awarded without undue delay on same basis |
| |as original contract. |

Table 8-7

|If adjustment is - |then - |
|9. for a protest filed with GAO in connection with a solicitation |obligate, (after final ruling is made on protest), funds available at|
|for, proposed award of, or award of a contract, |the time the protest was filed with GAO, provided the contract is |
| |awarded within 100 working days after the ruling. |
|10. for an obligation covering liquidated damages, |recover the amount of liquidated damages deducted and withheld. (see |
| |note 3) |
|11. for an anticipated price reduction on a contract determined with |adjust the original obligation as necessary. |
|a written agreement between the contracting officer and the | |
|contractor, | |
|12. for a miscellaneous obligation document (MOD) used to record an |adjust obligations against the MOD using same year funds. |
|estimated obligation (such as utility service), and later determined | |
|to be over or understated, | |
|13. based on receipt of credit for materiel return, |reduce the obligation to the allotment current at the time the notice|
| |of credit was generated. (see note 4) |
|14. | |
|a. required to make a payment for a recorded unliquidated obligation |a. and b. use unexpired funds available for the same general purpose |
|in a cancelled account. |subject to the unexpended and 1 percent limitations. |
| | |
|b. required to make a payment for an unrecorded obligation in a | |
|cancelled account. |c. Record the obligation in the cancelled account. |
| | |
|c. required to record an obligation in a cancelled account for a | |
|disbursement that was made before the account cancelled, (see note 5)| |
| |
|NOTES: |
|* 1. Contract changes citing expired funds require written documentation supporting these charges/adjustments as a legitimate use of |
|expired appropriations. See the DoDFMR, Volume 3, Chapter 10, paragraph 100202.B. |
|2. The fund holder is responsible for covering the U.S. Government's contingent liability under the contract and for ensuring enough funds|
|are available to cover net increases in obligations if the contingencies become actual liabilities when the formal contract supplement is |
|signed. |
|3. If a contractor objects to the deduction of liquidated damages, treat the amount as a contingent liability. Reestablish an obligation |
|only when a formal contractor claim is approved. |
|4. Maintain financial control over outstanding materiel returns to inventories. Account for returns as reversals of related materiel |
|procurement and/or issue transactions. |
|5. See Chapter 16 for procedures on adjustments to cancelled accounts. |

Table 8-7 (continued)