Appendix B
CHECKLIST FOR FUND CONTROL REGULATIONS
The following items must be included in the fund control regulations
submitted for OMB approval.
1. Statement of purpose.
At a minimum, the regulation should state broadly that its purpose
is to prescribe procedures to be followed in the execution of the
budget and articulate basic fund control principles and concepts.
Moreover, the regulation should state that it:
--Establishes policy with regard to the administrative control of
funds.
--Prescribes a system for positive administrative control of funds
designed to restrict obligations and expenditures (disbursements)
against each appropriation or fund account to the amount available
therein.
--Enables the agency head to determine responsibility for
overobligation and overdisbursement of appropriations,
apportionments, statutory limitations, allotments, suballotments,
and other administrative subdivisions, as well as violations of
limitations imposed by the agency.
--Provides procedures for dealing with violations of the
Antideficiency Act as well as violations of limitations imposed by
the agency, including reporting requirements.
2. Authority.
At a minimum the regulation should list the following:
1. Money and Finance. Title 31, United States Code:
--Sections 1341-1342, 1349-1351, 1511-1519 (part of the
Antideficiency Act, as amended).
--Sections 1101, 1104-1108, 3324 (part of the Budget and Accounting
Act, 1921, as amended).
--Sections 1501-1502 (part of section 1311 of the Supplemental
Appropriations Act of 1950).
--Sections 1112, 1531, 3511-3512, 3524 (part of the Budget and
Accounting Procedures Act of 1950).
2. Title X of P.L. 93-344, found at 2 U.S.C. 681-688.
3. OMB Circular No. A-34, "Instructions on Budget Execution," and
related OMB guidelines.
4. Other pertinent laws governing the agency's funds and appropriate
agency internal regulations, if any.
3. Scope.
The regulation should state that all organizations, appropriations,
and funds are subject to the provisions of the regulation. If there
are any exemptions, they must be clearly specified in the regulation.
All exemptions are subject to the prior approval of OMB.
4. Definitions, terminology, and concepts.
The agency regulation should have a section that specifies that the
definitions, terminology, and concepts in OMB Circular No. A-34 apply.
Agencies may restrict this to terms that are peculiar to, or have
special meaning within, the agency, except that definition of the
following terms should be included and should be identical to those
included in Part II of OMB Circular No. A-34: apportionment,
allotment, suballotment, administrative division or subdivision of
funds, and agency limitations.
To the extent that OMB Circular No. A-34 or Treasury regulations do
not provide a definition for a technical term, the section should
include a definition for the term that the agency is proposing to use
in the regulation.
5. Responsibility and functions of individuals.
The agency regulation should describe by title or position those
individuals within the agency charged with fund control
responsibilities. At a minimum it should provide:
a. A listing of the positions, including descriptions of the fund
control responsibilities of each.
b. An explanation of the responsibilities of each position with
regard to investigating, reporting, and following up on
Antideficiency Act violations, as well as violations of agency
limitations that are not violations of the Antideficiency Act.
6. Actions prohibited.
See section 32.2 of OMB Circular No. A-34 for general guidance. As a
minimum the following should be included:
1. Violations of the Antideficiency Act. A listing of all the basic
actions prohibited by sections 1341, 1342, and 1517(a) of Title
31, U.S. Code (part of the Antideficiency Act), as they are
interpreted and applied within the agency.
2. Violations of limitations that do not per se violate the
Antideficiency Act. A list and brief descriptions of all the
agency's imposed restrictions including a statement describing the
conditions under which violations of such restrictions constitute
violations of the Antideficiency Act.
7. Penalties.
The regulation should describe all criminal penalties, as well as
any additional disciplinary measures imposed by the agency, for
violations of the Antideficiency Act. In addition, penalties for
violations of agency limitations and requirements that the agency does
not consider subject to provisions of the Antideficiency Act should be
provided.
The law provides that any officer or employee of the United States
who violates the prohibitions of 31 U.S.C. 1341(a), 1342, or 1517(a)
shall be subject to appropriate administrative discipline.
Administrative discipline may consist of:
a. Letter of reprimand or censure for the official personnel record
of the officer or employee.
b. Unsatisfactory performance rating.
c. Transfer to another position.
d. Suspension from duty without pay.
e. Removal from office.
In addition, any person who knowingly and willfully violates these
prohibitions shall be fined not more than $5,000, imprisoned for not
more than 2 years, or both.
8. Reporting requirements.
At a minimum, the regulation should prescribe procedures for
reporting apparent violations to responsible agency officials and to
the President and the Congress. All violations must be reported
immediately upon discovery. Antideficiency Act violations must be
reported to the President, through OMB, in the form of a letter,
signed by the head of the agency and to the Congress, as required by
Part III of OMB Circular No. A-34.
Any individual with knowledge of a possible violation has the
responsibility to report it. The regulation should specify to whom
notification is to be given.
Subsequent actions taken to correct the cause of a violation do not
eliminate that violation--it is still required to be reported.
9. Relationship of accounting and fund control systems.
Agency fund control systems must be fully supported by agency
accounting systems.
The accounting system should provide for (a) recording all financial
transactions affecting apportionments, reapportionments, allotments,
agency restrictions, financial plans, program operating plans,
obligations and expenditures, as well as anticipated, earned, and
collected reimbursements, and (b) preparing and reconciling financial
reports that display cumulative obligations, and the remaining
unobligated balance, by appropriation and allotment, and cumulative
obligations by budget activity and object class.
10. Apportionment.
Agency procedures for requesting apportionment of funds are normally
contained in other directives or manuals. However, the following
should be included as part of the fund control regulation:
a. Briefly describe the agency's procedures for requesting the
apportionment of funds. List position(s) and organizations
responsible for such action.
b. Cite the basic internal agency directives covering the
apportionment of funds. At the agency's option, general guidance
covering apportionment action in connection with the following may
be included:
(1) Supplementals.
(2) Reprogramming.
(3) Transfer between accounts.
(4) Deficiency apportionments.
c. Also discuss agency administrative control of funds policies that
apply specifically to revolving funds, management funds, and trust
funds, including those that are not apportioned. If there are any
such funds which are not subject to the basic provisions of this
regulation (note section 3), the procedures used to control them
should be described in separate section.
11. Allotments and suballotments.
The regulations should contain a general policy statement that
allotments and suballotments will be established at the highest
practical level, and each operating unit shall be financed from not
more than one subdivision for each appropriation or fund (the
Antideficiency Act establishes these objectives). In addition, this
section should specify the criteria under which the allotment
structure may be changed, and identify who has authority to approve
such changes. It should again be emphasized that allotments and
suballotments are subject to the provisions of the Antideficiency Act.
Taking into account these requirements, the section on allotments
and suballotments should include the following:
a. Function and purpose of allotments and suballotments.
b. Restrictions.
(1) The sum of allotment amounts issued shall not exceed the
apportionment.
(2) The sum of suballotment amounts issued shall not exceed the
allotment amount.
(3) Allotments or other administrative subdivisions shall be
fixed in amount and changed only when authorized by the
authority who issued the subdivision initially.
(4) Congressional restrictions contained in appropriation acts
shall be covered.
(5) Include other restrictions which the agency may want with
respect to administrative subdivisions.
Part III should be used as a guide. However, it does not preclude an
agency from establishing more stringent requirements for the allotment
of reimbursements and other receipts.
c. Allotment procedures.
(1) Allotments and suballotments should be made using formal
documents.
(2) These procedures should identify the officers authorized to
issue allotments and suballotments and the officers and
employees authorized to reduce them.
(3) At a minimum the following items should be documented:
a. Amount available.
b. Funding source (e.g., appropriations, reimbursements).
c. Time period of availability.
d. The position title of the official responsible and other
agency limitations.
e. Justification for changes in allotments. (In some cases,
changes in allotments will cause the need for a
reapportionment, which requires OMB approval.)
12. Withholdings.
See Part VII of OMB Circular No. A-34.
13. Anticipated amounts and reimbursable work.
Apportionments may include amounts of budgetary resources that are
anticipated and others that arise from reimbursable work.
The regulations should incorporate the treatment of budgetary
resources prescribed by section 31.4 of OMB Circular No. A-34.
Moreover, the regulations should include a requirement that all
officials who receive allotments containing reimbursements or
anticipated amounts will maintain constant and careful oversight to
ensure that these are realized or earned as planned. If actual
earnings or amounts realized are less than anticipated, appropriate
funding adjustments shall be made and other appropriate action,
including reapportionment, be taken.
14. Deficiency apportionments.
As a minimum the regulation should state: Apportionments that
anticipate the need for a deficiency appropriation or a supplemental
under 31 U.S.C. 1515, will be specifically identified on the
apportionment request (S.F. 132).
To qualify as a deficiency apportionment, the request must be
required by (1) laws enacted subsequent to the transmittal to Congress
of the annual budget for the year, (2) emergencies involving human
life, the protection of property, or the immediate welfare of
individuals, or (3) specifically authorized by law.
The approval of a deficiency apportionment by OMB and its
transmittal to Congress merely advises the Congress that funds
appropriated to date are being obligated at a more rapid rate than
previously anticipated. This notification does not guarantee that the
Congress will approve any part of any associated supplemental requests
and does not authorize the use of any amounts not yet provided.