A-57477, OCTOBER 5, 1934, 14 COMP. GEN. 281

A-57477, OCTOBER 5, 1934, 14 COMP. GEN. 281

EXCHANGE - LOSSES BY APPRECIATION OF FOREIGN CURRENCY THE LOSSES INCURRED BY OFFICERS AND EMPLOYEES OF THE UNITED STATES DUE TO THE APPRECIATION OF FOREIGN CURRENCY IN ACCORDANCE WITH THE ACT OF MARCH 26, 1934, AND THE EXECUTIVE ORDERS ISSUED THEREUNDER ARE TO BE COMPUTED UPON THE NET PAY COMPENSATION AND ALLOWANCES ACCRUING TO EMPLOYEES SUBSEQUENT TO JULY 14, 1933, DURING PERIODS OF FOREIGN SERVICE, LEAVE, OR TRAVEL, AS DEFINED IN EXECUTIVE ORDER NO. 6657-A AS AMENDED AND NOT OTHERWISE, IRRESPECTIVE OF WHEN OR WHERE THE CHECKS COVERING SUCH PAY, COMPENSATION, OR ALLOWANCES MAY BE CASHED. AS THE EXECUTIVE ORDER EXPRESSLY INCLUDES LEAVE OF ABSENCE WITH PAY IN A FOREIGN COUNTRY, NO LOSSES MAY BE BASED UPON PERIODS OF LEAVE IN THE UNITED STATES.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF STATE, OCTOBER 5, 1934:

THERE HAS BEEN RECEIVED YOUR LETTER OF AUGUST 28, 1934, AS FOLLOWS:

THERE IS ENCLOSED A COPY OF A DESPATCH OF JULY 20, 1934, FROM MR. THEODORE MARRINER, COUNSELOR OF THE AMERICAN EMBASSY AT PARIS, FRANCE, TRANSMITTING A CLAIM OF FRANCS 10,115.95 FOR EXCHANGE LOSS INCURRED ON SALARY ON ACCOUNT OF APPRECIATION OF THE FRANC IN RELATION TO THE AMERICAN DOLLAR DURING A PERIOD OF LEAVE OF ABSENCE IN THE UNITED STATES AND WHILE TRAVELING ON AMERICAN VESSELS, HIS CHECKS FOR WHICH WERE CASHED IN FRANCE.

THE EXECUTIVE ORDER NO. 6810 OF AUGUST 4, 1934, A COPY OF WHICH IS ENCLOSED, AMENDS THE EXECUTIVE ORDER NO. 6657-A OF MARCH 27, 1934, SO THAT THERE IS NO QUESTION ABOUT REIMBURSEMENT FOR THE PERIOD WHILE TRAVELING ON AMERICAN VESSELS.

THE ACT OF MARCH 26, 1934, AUTHORIZES PAYMENT OF LOSSES SUSTAINED "WHILE IN SERVICE IN FOREIGN COUNTRIES," AND THE EXECUTIVE ORDER OF MARCH 27, 1934, SAYS:

"1. THE WORDS IN THE ACT "WHILE IN SERVICE IN FOREIGN COUNTRIES," FOR THE PURPOSE OF THESE REGULATIONS, SHALL BE UNDERSTOOD TO MEAN (A) WHILE EMPLOYED IN OR ON ASSIGNMENT OR DETAIL TO A POST OF DUTY IN A FOREIGN COUNTRY, (B) WHILE ON ROUTE THROUGH A FOREIGN COUNTRY OR ON A FOREIGN VESSEL TO OR FROM SUCH POST, (C) WHILE, DURING SUCH ASSIGNMENT OR DETAIL ABROAD, ON LEAVE OF ABSENCE WITH PAY IN A FOREIGN COUNTRY, (D) WHILE TRAVELING IN FOREIGN COUNTRIES UNDER OFFICIAL ORDERS, OR (E) WHILE ATTACHED TO AND SERVING ON BOARD UNITED STATES VESSELS STATIONED IN FOREIGN WATERS FOR NOT LESS THAN 30 CONSECUTIVE DAYS.'

IN DRAFTING THE EXECUTIVE ORDER, SECTION C OF THE ABOVE ARTICLE WAS SO WORDED AS TO COVER LEAVE WHEN IN A FOREIGN COUNTRY, THE ASSUMPTION BEING THAT WHILE ON LEAVE IN THE UNITED STATES, STILL IN SERVICE ABROAD, SALARY CHECKS OR DRAFTS WOULD PROBABLY BE CASHED IN THE UNITED STATES, AND CONSEQUENTLY NO LOSS WOULD BE SUSTAINED.

HOWEVER, AS IN MR. MARRINER'S CASE, IT OCCASIONALLY HAPPENS THAT AN OFFICER DOES NOT HAVE OCCASION TO CASH SUCH DRAFTS AND CHECKS IN THE UNITED STATES, BUT FINDS IT NECESSARY TO DO SO FOR HIS EXPENDITURES AT HIS POST ON HIS RETURN THERE. IN SUCH CASES IT APPEARS TO THE DEPARTMENT THAT LOSSES SUSTAINED ARE PROPERLY WITHIN THE INTENT OF THE LAW.

THERE IS A SIMILAR CASE IN CHECKS COVERING ALLOWANCES FOR RENT OF RESIDENCES. SINCE OBVIOUSLY EXPENDITURES FOR RENT UNDER THESE ALLOWANCES MUST BE PAID ABROAD, AND THE ALLOWANCES ARE NOT PAID TO OFFICERS DURING ABSENCE ON LEAVE EXCEPT WHERE THEY MUST MAINTAIN THEIR QUARTERS WHILE ABSENT, THE DEPARTMENT HAS CONSIDERED THAT LOSSES ON SUCH CHECKS ARE A PROPER CHARGE AGAINST THE APPROPRIATION.

I WOULD BE GLAD TO RECEIVE YOUR VIEWS IN REGARD TO THESE POINTS.

WHILE THE ACT OF MARCH 26, 1934, 48 STAT. 466, VERY BROADLY PROVIDES FOR MEETING LOSSES SUSTAINED ON AND AFTER JULY 15, 1933, BY OFFICERS, ENLISTED MEN, AND EMPLOYEES OF THE UNITED STATES WHILE SERVING IN FOREIGN COUNTRIES, IT IS NOT TO BE CONSTRUED AS AUTHORIZING REIMBURSEMENT FOR ALL LOSSES SUSTAINED BY SUCH OFFICERS, ENLISTED MEN, AND EMPLOYEES, BUT ONLY SUCH LOSSES, ACTUAL OR THEORETICAL, AS ARE DIRECTLY CONNECTED WITH AND RESULTING FROM THEIR EMPLOYMENT OR TRAVEL IN THE FOREIGN COUNTRY OR WHILE EN ROUTE TO AND FROM SUCH COUNTRY, THAT IS TO SAY, LOSSES ON PAY AND ALLOWANCES ACCRUING "WHILE IN SERVICE IN FOREIGN COUNTRIES" SUBSEQUENT TO JULY 14, 1933.

EXECUTIVE ORDER NO. 6657-A, OF MARCH 27, 1934, AS AMENDED BY EXECUTIVE ORDERS NOS. 6780 OF JUNE 30, 1934, AND 6810 OF AUGUST 4, 1934, PROVIDED AS FOLLOWS:

PURSUANT TO THE AUTHORITY VESTED IN ME BY THE ACT ENTITLED "AN ACT TO AUTHORIZE ANNUAL APPROPRIATIONS TO MEET LOSSES SUSTAINED BY OFFICERS AND EMPLOYEES OF THE UNITED STATES IN FOREIGN COUNTRIES DUE TO APPRECIATION OF FOREIGN CURRENCIES IN THEIR RELATION TO THE AMERICAN DOLLAR, AND FOR OTHER PURPOSES," APPROVED MARCH 26, 1934, AND IN ORDER TO AFFORD IMMEDIATE RELIEF, I PRESCRIBE THE FOLLOWING TEMPORARY REGULATIONS, WHICH SHALL APPLY TO ALL OFFICERS, ENLISTED MEN, AND EMPLOYEES OF THE UNITED STATES WHILE IN SERVICE IN FOREIGN COUNTRIES.

DEFINITION

1. THE WORDS IN THE ACT "WHILE IN SERVICE IN FOREIGN COUNTRIES," FOR THE PURPOSE OF THESE REGULATIONS, SHALL BE UNDERSTOOD TO MEAN (A) WHILE EMPLOYED IN OR ON ASSIGNMENT OR DETAIL TO A POST OF DUTY IN A FOREIGN COUNTRY, (B) WHILE EN ROUTE THROUGH A FOREIGN COUNTRY OR TO OR FROM SUCH POST, (C) WHILE, DURING SUCH ASSIGNMENT OR DETAIL ABROAD, ON LEAVE OF ABSENCE WITH PAY IN A FOREIGN COUNTRY, (D) WHILE TRAVELING IN FOREIGN COUNTRIES UNDER OFFICIAL ORDERS, OR (E) WHILE ATTACHED TO AND SERVING ON BOARD UNITED STATES VESSELS STATIONED IN FOREIGN WATERS FOR NOT LESS THAN 30 CONSECUTIVE DAYS.

PURPOSE OF REGULATIONS

2. THE PURPOSE OF THESE REGULATIONS IS TO PROVIDE FOR REIMBURSEMENT TO OFFICERS, ENLISTED MEN, AND EMPLOYEES OF THE UNITED STATES (HEREINAFTER REFERRED TO AS EMPLOYEES), FOR LOSSES SUSTAINED FROM APPRECIATION OF FOREIGN CURRENCIES IN THEIR RELATION TO THE AMERICAN DOLLAR, AS AUTHORIZED UNDER THE AFORESAID ACT.

METHOD OF COMPUTATION OF PAYMENT OF LOSSES

3. (A) THE LOSS ABOVE REFERRED TO IS THAT CALCULATED ON THE BASIS OF CONVERSION INTO FOREIGN CURRENCY OF THE EMPLOYEE'S NET SALARY AND NET ALLOWANCES, EXCEPT AS PROVIDED IN PARAGRAPHS (B) AND (C) OF THIS SECTION.

(B) IN CASE OF EMPLOYEES SERVING UNDER THE WAR AND NAVY DEPARTMENTS (WITH THE EXCEPTION OF MILITARY AND NAVAL ATTACHES AND OTHER EMPLOYEES ATTACHED TO THEIR OFFICES, WHO SHALL BE GOVERNED BY PARAGRAPH (A) OF THIS SECTION), THE LOSS IS THAT CALCULATED ON THE BASIS OF CONVERSION INTO FOREIGN CURRENCY OF THE EMPLOYEE'S NET PAY AND ALLOWANCES.

(C) IN CASE OF EMPLOYEES TRAVELING IN FOREIGN COUNTRIES UNDER OFFICIAL ORDERS, NOT EMPLOYED IN OR ON ASSIGNMENT OR DETAIL TO A POST OF DUTY IN A FOREIGN COUNTRY, NO PART OF THE EMPLOYEE'S SALARY NOT CONVERTED FOR EXPENDITURE ABROAD SHALL BE INCLUDED IN THE LOSS REFERRED TO FOR THE PURPOSES OF THESE REGULATIONS.

(D) IN CASE OF EMPLOYEES WHO SUSTAINED LOSSES ARISING FROM THE CONVERSION OF SALARIES OR ALLOWANCES (INCLUDING THOSE PAID FROM FEES EITHER IN FOREIGN OR AMERICAN CURRENCY) DURING THE PERIOD FROM JULY 15, 1933, TO THE EFFECTIVE DATE OF THIS ORDER, THE LOSSES SHALL BE CALCULATED AS PROVIDED IN PARAGRAPHS (A), (B) AND (C) OF THIS SECTION. CLAIM FOR REIMBURSEMENT FOR SUCH LOSS SHALL BE ACCOMPANIED BY THE BEST EVIDENCE, AVAILABLE TO THE EMPLOYEE, OF THE RATE AT WHICH CONVERSION WAS MADE.

(E) AS USED IN THIS SECTION:

THE TERM "NET SALARY" MEANS THE BASE SALARY LESS ANY DEDUCTION FOR CONTRIBUTION TO THE RETIREMENT OR OTHER FUND, OR ON ACCOUNT OF PERCENTAGE DEDUCTIONS IN COMPENSATION.

THE TERM "NET ALLOWANCES" MEANS ALLOWANCES PAID TO THE EMPLOYEE.

THE TERM "NET PAY AND ALLOWANCES" MEANS THE EMPLOYEE'S FULL PAY, INCLUDING EXTRA OR ADDITIONAL PAY, AND ALL ALLOWANCES (OTHER THAN THOSE FURNISHED IN KIND) LESS DEDUCTIONS THEREFROM ON ACCOUNT OF ALLOTMENTS, FINES, AND FORFEITURES, CLOTHING, HOSPITAL, CIVIL-SERVICE RETIREMENT FUND, PERCENTAGE DEDUCTIONS IN COMPENSATION, AND OTHER SUNDRY CHECK AGES.

THE ORDER WAS FURTHER AMENDED BY EXECUTIVE ORDER NO. 6850 OF SEPTEMBER 18, 1934, WITH RESPECT TO A CONDITION NOT HERE INVOLVED.

THE OMISSION OF THE WORDS "ON FOREIGN VESSELS" FROM SECTION 1 (B) OF THE ORIGINAL ORDER BY THE AMENDMENT OF AUGUST 4, 1934, DOES NOT OF ITSELF MAKE THE EXECUTIVE ORDER APPLICABLE TO ALL TRAVEL ON AMERICAN VESSELS, THE EFFECT OF THE OMISSION BEING THAT WHERE THERE IS AN OTHERWISE REIMBURSABLE LOSS WHILE EN ROUTE TO OR FROM A POST OF DUTY IN A FOREIGN COUNTRY THE FACT THAT THE TRAVEL WAS ON AN AMERICAN VESSEL WILL NOT PRECLUDE SUCH REIMBURSEMENT.

ACCORDINGLY, THE LOSSES TO BE REIMBURSED ARE TO BE COMPUTED UPON THE NET PAY AND ALLOWANCES ACCRUING TO THE EMPLOYEE SUBSEQUENT TO JULY 14, 1933, DURING PERIODS OF FOREIGN SERVICE, LEAVE, OR TRAVEL, AS DEFINED IN PARAGRAPH 1 OF THE EXECUTIVE ORDER AS AMENDED, AND NOT OTHERWISE, IRRESPECTIVE OF WHEN OR WHERE THE CHECKS COVERING SUCH PAY AND ALLOWANCES MAY BE CASHED. AS THE DEFINITION IN THE EXECUTIVE ORDER EXPRESSLY INCLUDES "LEAVE OF ABSENCE WITH PAY IN A FOREIGN COUNTRY" IT MUST BE HELD TO EXCLUDE PERIODS OF LEAVE IN THE UNITED STATES NOTWITHSTANDING THAT THE CHECK FOR COMPENSATION COVERING THE PERIOD OF LEAVE IN THIS COUNTRY MAY NOT BE ISSUED OR CASHED UNTIL THE EMPLOYEE'S RETURN TO THE FOREIGN COUNTRY.

THE VOUCHER FORWARDED WITH YOUR MEMORANDUM WILL BE RETAINED IN THIS OFFICE FOR DIRECT SETTLEMENT IN ACCORDANCE WITH THE FOREGOING.