Reports on Unvouchered Expenditures

101.1. Background.

  Executive Branch agencies are required to submit information to OMB
on unvouchered expenditures annually. The information is used by OMB
to prepare the annual report required by law (31 U.S.C. 3524) on
accounts containing unvouchered expenditures that are potentially
subject to audit by the Comptroller General.

101.2. Definition.

  An "unvouchered expenditure" is any expenditure accounted for solely
on the approval, authorization, or certificate of the President or an
official of an executive agency.

101.3. Basis for exemptions.

  The law provides for exemptions for individual financial
transactions or for a class or category of financial transaction if
they relate to:

  --Sensitive foreign intelligence or counterintelligence activities.

  --Sensitive law enforcement investigations in which an audit
    proceeding would expose the identifying details of an active
    investigation or endanger the safety of investigative or domestic
    intelligence sources involved in such law enforcement
    investigations.

  The law gives the President the authority to exempt these financial
transactions from audit. Agencies will make any requests for
exemptions through the White House Counsel's office.

101.4. Coverage.

  Subject to 31 U.S.C. 3524(c) and (d), these instructions apply to
the accounts of all executive agencies authorized to contain
unvouchered expenditure. Funds used under Section 8(b) of the CIA Act
of 1949 are exempt from this GAO audit and are not covered in the
annual report to Congress on unvouchered expenditures.

101.5. Requirements.

  The head of each executive department and establishment will submit
to OMB a list of all of the agency's accounts that contain unvouchered
expenditures. An explanation of any additions to or deletions from the
accounts listed in the previous year's report will also be provided.

  The list (including explanations, as appropriate) will be submitted
to OMB no later than November 1 of each year in the format of Exhibit
101. It will be transmitted to OMB in a sealed envelope marked: "TO BE
OPENED ONLY BY THE SECURITY OFFICER, EXECUTIVE OFFICE OF THE
PRESIDENT, NEW EXECUTIVE OFFICE BUILDING." The envelope will be placed
inside an envelope that is sealed and addressed to the Director of
OMB.

  Each agency head will ensure the timeliness, accuracy, and
completeness of the required information on unvouchered expenditures.
In addition, all executive departments and establishments required to
submit information on unvouchered expenditures will maintain records
of these transactions in a manner similar to those maintained for
regular financial transactions and accounts in order to insure proper
accountability.

101.6. OMB responsibilities.

  The Director of OMB will prepare and submit the report to certain
congressional committees and to the GAO before December 1 of each
year, as required by law.