A-21265, MARCH 1, 1928, 7 COMP. GEN. 537

A-21265: Mar 1, 1928

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PAYMENTS - DISCOUNTS VOUCHERS INVOLVING THE PAYMENT OF GOVERNMENT OBLIGATIONS WHERE OFFERED DISCOUNTS FOR PROMPT PAYMENT ARE NOT DEDUCTED SHOULD BE ACCOMPANIED BY STATEMENTS SHOWING THE REASON FOR FAILURE TO SECURE SUCH DISCOUNTS. WHERE IT IS SHOWN THAT ADMINISTRATIVE DELAY CAUSED THE LOSS OF DISCOUNT. CREDIT WILL BE ALLOWED IN THE DISBURSING OFFICER'S ACCOUNT FOR OTHERWISE PROPER PAYMENTS MADE WITHOUT DEDUCTING THE DISCOUNT. IN CASES WHERE IT APPEARS THE PAYMENT WAS MADE WITHIN THE DISCOUNT PERIOD AND THE DISCOUNT WAS NOT TAKEN OR WHERE IT IS NOT SHOWN THAT THE DISBURSING OFFICER NOR THE PAYEE WAS RESPONSIBLE FOR THE FAILURE TO EFFECT PAYMENT WITHIN THE DISCOUNT PERIOD. A SUSPENSION IN THE ACCOUNTS OF THE DISBURSING OFFICER WILL BE MADE PENDING FINAL DETERMINATION OF THE QUESTION.

A-21265, MARCH 1, 1928, 7 COMP. GEN. 537

PAYMENTS - DISCOUNTS VOUCHERS INVOLVING THE PAYMENT OF GOVERNMENT OBLIGATIONS WHERE OFFERED DISCOUNTS FOR PROMPT PAYMENT ARE NOT DEDUCTED SHOULD BE ACCOMPANIED BY STATEMENTS SHOWING THE REASON FOR FAILURE TO SECURE SUCH DISCOUNTS. WHERE IT IS SHOWN THAT ADMINISTRATIVE DELAY CAUSED THE LOSS OF DISCOUNT, CREDIT WILL BE ALLOWED IN THE DISBURSING OFFICER'S ACCOUNT FOR OTHERWISE PROPER PAYMENTS MADE WITHOUT DEDUCTING THE DISCOUNT. IN CASES WHERE IT APPEARS THE PAYMENT WAS MADE WITHIN THE DISCOUNT PERIOD AND THE DISCOUNT WAS NOT TAKEN OR WHERE IT IS NOT SHOWN THAT THE DISBURSING OFFICER NOR THE PAYEE WAS RESPONSIBLE FOR THE FAILURE TO EFFECT PAYMENT WITHIN THE DISCOUNT PERIOD, A SUSPENSION IN THE ACCOUNTS OF THE DISBURSING OFFICER WILL BE MADE PENDING FINAL DETERMINATION OF THE QUESTION. WHERE THERE IS ANY QUESTION AS TO THE RIGHT TO DEDUCT THE DISCOUNT AT THE TIME OF PAYMENT OF A VOUCHER, THE DISCOUNT SHOULD BE DEDUCTED BY THE DISBURSING OFFICER AND PAYMENT OF THE BALANCE TENDERED THE PAYEE, WHO, IF NOT SATISFIED, MAY ACCEPT THE PAYMENT UNDER PROTEST AND FILE CLAIM IN THE GENERAL ACCOUNTING OFFICE FOR REFUND OF THE AMOUNT DEDUCTED. 4 COMP. GEN. 478, MODIFIED.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF WAR, MARCH 1, 1928:

THERE HAS BEEN RECEIVED YOUR LETTER OF JANUARY 11, 1928, RELATIVE TO THE PROCEDURE FOLLOWED BY THIS OFFICE IN THE AUDIT OF VOUCHERS COVERING PAYMENTS IN WHICH THERE APPEARS A FAILURE TO TAKE ADVANTAGE OF DISCOUNTS AVAILABLE TO THE UNITED STATES FOR PROMPT PAYMENT OF ITS OBLIGATIONS.

YOU SET FORTH AT LENGTH YOUR REASONS FOR SUGGESTING A MODIFICATION OF THE EXISTING PROCEDURE, IN SO FAR AS IT INVOLVES SUSPENSION OF CREDIT IN THE ACCOUNTS OF DISBURSING OFFICERS WHERE THE FAILURE TO SECURE THE DISCOUNT IS SHOWN TO BE DUE TO THE FAULT OF ADMINISTRATIVE OFFICERS OF THE WAR DEPARTMENT, AND REQUIRES THE SUBMISSION TO THIS OFFICE FOR DECISION IN ADVANCE OF PAYMENT, OR FOR DIRECT SETTLEMENT, VOUCHERS IN CONNECTION WITH WHICH IT IS NOT SHOWN THAT THE FAILURE TO TAKE ADVANTAGE OF THE DISCOUNT WAS NOT DUE TO INEXCUSABLE DELAY ON THE PART OF ADMINISTRATIVE OFFICERS.

YOU REFER TO THE SUBSTANTIAL SAVINGS MADE IN RECENT YEARS BY THE ADMINISTRATIVE POLICY OF SECURING OFFERS OF DISCOUNTS FOR PROMPT PAYMENT OF WAR DEPARTMENT OBLIGATIONS AND THE STRICT PROCEDURE REQUIRING THAT ADVANTAGE BE TAKEN OF SUCH OFFERS, AND YOU SUGGEST THAT WHERE DEALERS ARE THUS INDUCED TO OFFER SUCH DISCOUNTS THEY SHOULD NOT BE PENALIZED ON ACCOUNT THEREOF BY SUFFERING THE ADDITIONAL DELAY IN PAYMENT NECESSITATED BY THE REFERENCE TO THIS OFFICE FOR DECISION OR PAYMENT OF VOUCHERS WHERE THE FAILURE TO MAKE PAYMENT WITHIN THE DISCOUNT PERIOD IS DUE TO THE FAULT OF ADMINISTRATIVE OFFICERS, AS APPARENTLY REQUIRED IN DECISION OF NOVEMBER 25, 1924, 4 COMP. GEN. 478, AND, ALSO, THAT CREDIT SHOULD NOT BE SUSPENDED IN THE ACCOUNTS OF DISBURSING OFFICERS MAKING PAYMENT WITHOUT DISCOUNT WHERE THE FAILURE TO OBTAIN THE BENEFIT OF AN OFFERED DISCOUNT IS SHOWN TO BE DUE TO ADMINISTRATIVE NEGLECT, AND NOT TO THE FAULT OF THE DISBURSING OFFICER OR THE PAYEE. YOU REQUEST, IN LIEU OF THE EXISTING PROCEDURE IN SUCH CASES--- THAT IS, IN CASES IN WHICH IT APPEARS THAT THE FAILURE TO MAKE PAYMENT WITHIN THE DISCOUNT PERIOD WAS DUE TO DELAY ON THE PART OF SOME ADMINISTRATIVE OFFICER--- THAT THE DISBURSING OFFICER BE PERMITTED TO MAKE THE PAYMENT WITHOUT DEDUCTING THE DISCOUNT, THAT CREDIT FOR THE AMOUNT BE NOT SUSPENDED IN THE SETTLEMENT OF HIS ACCOUNTS, AND THAT YOU BE ADVISED BY THIS OFFICE AS TO THE NAME OF THE ADMINISTRATIVE OFFICER SHOWN TO HAVE BEEN RESPONSIBLE FOR THE DELAY.

IN CASES WHERE THE FACTS SHOW THAT ADMINISTRATIVE DELAY CAUSED THE LOSS OF DISCOUNT, THIS OFFICE WILL MAKE NO OBJECTION TO PAYMENT BY A DISBURSING OFFICER, BUT IN LIEU OF THIS OFFICE REPORTING THEREON TO YOU THROUGH EXAMINATION OF THE ACCOUNTS, IF THE DELAY IS NOT SHOWN TO BE EXCUSABLE, THE PROPER PROCEDURE REQUIRES THAT EITHER THE ADMINISTRATIVE OFFICER CONCERNED OR THE DISBURSING OFFICER REPORT TO YOU, AND THAT THERE BE ATTACHED TO THE VOUCHER A COPY OF THE REPORT TO YOU, TOGETHER ALSO WITH YOUR ACTION THEREON IF TAKEN PRIOR TO TRANSMITTING THE DISBURSING ACCOUNT TO THIS OFFICE, OTHERWISE YOUR ACTION TO BE REPORTED TO THIS OFFICE IN DUE COURSE FOR CONSIDERATION IN THE SETTLEMENT OF THE DISBURSING ACCOUNT. WHERE THE ACCOUNTS ARE RECEIVED NOT COMPLETE IN THIS RESPECT, IT WILL BE DULY BROUGHT TO YOUR ATTENTION AND WITHOUT SUSPENSIONS IN THE ACCOUNT IF FOUND POSSIBLE NOT TO SUSPEND.

IN OTHER CASES INVOLVING FAILURE TO TAKE AN APPARENTLY AVAILABLE DISCOUNT, SUCH AS WHERE IT APPEARS THE PAYMENT WAS MADE WITHIN THE DISCOUNT PERIOD AND THE DISCOUNT WAS NOT TAKEN, OR WHERE IT IS NOT SHOWN THAT THE DISBURSING OFFICER NOR THE PAYEE WAS RESPONSIBLE FOR THE FAILURE TO EFFECT PAYMENT WITHIN THE DISCOUNT PERIOD, THE DISBURSING OFFICER WILL BE HELD RESPONSIBLE AND A SUSPENSION IN HIS ACCOUNTS OF THE AMOUNT OF THE QUESTIONABLE PAYMENT WILL BE NECESSARY PENDING THE FINAL DETERMINATION OF THE QUESTION.

IN CASES IN WHICH THERE IS INVOLVED ANY QUESTION, AS BETWEEN THE GOVERNMENT AND THE PAYEE, OF THE RIGHT TO DEDUCT THE DISCOUNT, IN THE INTEREST OF MAKING PROMPT PAYMENTS AND TO SAVE THE RIGHT OF THE GOVERNMENT TO THE DISCOUNT IF IT SUBSEQUENTLY SHOULD BE DETERMINED TO HAVE BEEN PROPERLY DEDUCTIBLE AT THE TIME OF PAYMENT, THE DISCOUNT SHOULD BE DEDUCTED AND PAYMENT OF THE BALANCE TENDERED THE PAYEE, WHO, IF NOT SATISFIED, MAY ACCEPT THE PAYMENT UNDER PROTEST AND FILE CLAIM IN THIS OFFICE, EITHER DIRECTLY OR THROUGH THE DEPARTMENT, FOR A REFUND OF THE AMOUNT DEDUCTED.

OF COURSE, CREDIT WILL BE DISALLOWED IN THE ACCOUNTS OF DISBURSING OFFICERS FOR THE AMOUNT OF OFFERED DISCOUNTS NOT DEDUCTED WHEN IT IS DETERMINED THAT THEY WERE PROPERLY DEDUCTIBLE AT THE TIME OF PAYMENT.