A-56138, SEPTEMBER 11, 1934, 14 COMP. GEN. 204

A-56138: Sep 11, 1934

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WAS TO GIVE AN EMPLOYEE OF THE UNITED STATES IN A FOREIGN COUNTRY THE AMOUNT OF FOREIGN CURRENCY SUCH EMPLOYEE WOULD HAVE RECEIVED PRIOR TO THE APPRECIATION OF FOREIGN CURRENCY IN THEIR RELATION TO THE AMERICAN DOLLAR. REGARDLESS OF WHETHER HE IS PAID IN SUCH FOREIGN CURRENCY OR ITS EQUIVALENT IN UNITED STATES CURRENCY. IS BY ITS TERMS EFFECTIVE APRIL 1. PAYMENTS OF RELIEF UNDER THE ACT WILL BE BASED UPON CONVERSION OF AMOUNTS RECEIVED DURING THAT PERIOD. 2. THESE RELIEF BENEFITS ARE BASED UPON THE AMOUNT OF NET PAY AND ALLOWANCES ACCRUED TO THE CREDIT OF THE EMPLOYEE. 3. NECESSARILY UNPAID BALANCES DEVELOP ON THE LAST DAY OF EACH CALENDAR MONTH WHICH ARE ORDINARILY INCLUDED IN THE PAYMENT MADE ON THE 5TH OF THE FOLLOWING MONTH.

A-56138, SEPTEMBER 11, 1934, 14 COMP. GEN. 204

FOREIGN EXCHANGE - LOSSES, PAYMENT OF UNDER ACT OF MARCH 26, 1934, 48 STAT. 466 THE PURPOSE OF SECTION 5 OF THE EXECUTIVE ORDER NO. 6657-A, DATED MARCH 27, 1934, ISSUED PURSUANT TO ACT OF MARCH 26, 1934, 48 STAT. 466, WAS TO GIVE AN EMPLOYEE OF THE UNITED STATES IN A FOREIGN COUNTRY THE AMOUNT OF FOREIGN CURRENCY SUCH EMPLOYEE WOULD HAVE RECEIVED PRIOR TO THE APPRECIATION OF FOREIGN CURRENCY IN THEIR RELATION TO THE AMERICAN DOLLAR, REGARDLESS OF WHETHER HE IS PAID IN SUCH FOREIGN CURRENCY OR ITS EQUIVALENT IN UNITED STATES CURRENCY. THE EXECUTIVE ORDER NO. 6657-A, DATED MARCH 27, 1934, IS BY ITS TERMS EFFECTIVE APRIL 1, 1934, BUT IN MAKING PAYMENTS SUBSEQUENT TO SAID DATE, UNDER THE PROVISIONS OF SECTION 5 OF THE ORDER, THERE MAY BE TAKEN INTO CONSIDERATION ANY LOSS WITH REFERENCE TO AMOUNTS PROPERLY ACCRUING PRIOR TO SAID DATE (BUT NOT PRIOR TO JULY 15, 1933), I.E., SECTION 5 OF THE ORDER HAS REFERENCE TO THE DATE OF PAYMENT AND CONVERSION INTO FOREIGN CURRENCY RATHER THAN THE PERIOD UNDER WHICH THE PAY, ETC., ACCRUES.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE NAVY, SEPTEMBER 11, 1934:

BY FIRST INDORSEMENT DATED JUNE 13, 1934, THE JUDGE ADVOCATE GENERAL OF THE NAVY REQUESTS A DECISION ON THE MATTER PRESENTED BY THE CHIEF, BUREAU OF SUPPLIES AND ACCOUNTS, NAVY DEPARTMENT, IN A LETTER TO YOU DATED JUNE 7, 1934, AS FOLLOWS:

1. EXECUTIVE ORDER NO. 6657-A, DATED MARCH 27, 1934, ISSUED PURSUANT TO THE PROVISIONS OF THE ACT OF MARCH 26, 1934, 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, ETC., " PROVIDES THAT FOR THE PERIOD JULY 15, 1933, TO MARCH 31, 1934, PAYMENTS OF RELIEF UNDER THE ACT WILL BE BASED UPON CONVERSION OF AMOUNTS RECEIVED DURING THAT PERIOD.

2. FROM AND INCLUDING APRIL 1, 1934, THESE RELIEF BENEFITS ARE BASED UPON THE AMOUNT OF NET PAY AND ALLOWANCES ACCRUED TO THE CREDIT OF THE EMPLOYEE.

3. IN VIEW OF THE METHOD OF PAYMENT TO PERSONS IN THE NAVAL SERVICE, I.E., ON THE 5TH AND THE 20TH OF EACH MONTH, NECESSARILY UNPAID BALANCES DEVELOP ON THE LAST DAY OF EACH CALENDAR MONTH WHICH ARE ORDINARILY INCLUDED IN THE PAYMENT MADE ON THE 5TH OF THE FOLLOWING MONTH. PRACTICALLY EVERY INSTANCE ON THE ASIATIC STATION THERE IS AN UNPAID BALANCE DUE THE EMPLOYEE ON MARCH 31, 1934. IN VIEW OF THE PROVISIONS OF THE EXECUTIVE ORDER ABOVE MENTIONED IT IS REQUESTED THAT THE FOLLOWING QUESTIONS BE PRESENTED TO THE COMPTROLLER GENERAL FOR DECISION:

(1) MAY BALANCES DUE AND UNPAID ON MARCH 31, 1934, BE INCLUDED IN THE COMPUTATION OF THE BENEFITS AUTHORIZED BY THE ACT AND THE EXECUTIVE ORDER FOR THE PORTION OF SUCH BALANCES REPRESENTING NET PAY AND ALLOWANCES ACCRUED WHILE IN SERVICE IN A FOREIGN COUNTRY ON AND AFTER JULY 15, 1933?

(2) MAY SUNDRY CREDITS OF PAY AND ALLOWANCES ACCRUED DURING THE PERIOD BETWEEN JULY 15, 1933, AND MARCH 31, 1934, WHILE IN SERVICE IN FOREIGN COUNTRIES, CREDITED ON PAY ROLLS SUBSEQUENT TO MARCH 31, 1934, BE INCLUDED IN THE COMPUTATION OF THE BENEFITS UNDER THE LAW AND EXECUTIVE ORDER ABOVE MENTIONED.

THE PURPOSE OF THE EXECUTIVE ORDER REFERRED TO IN THE LATTER, SUPRA, IS STATED IN SECTION 2 THEREOF, AS FOLLOWS:

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.

AND THE METHOD OF COMPUTATION OF PAYMENT OF SUCH LOSSES IS COVERED BY SECTION 3 OF SAID ORDER, AS FOLLOWS:

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 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.

SECTION 3 (C), SUPRA, WAS AMENDED BY EXECUTIVE ORDER NO. 6780, DATED JUNE 30, 1934, SUCH AMENDMENT, HOWEVER, NOT BEING MATERIAL HERE.

THE EFFECTIVE DATE OF THE ORDER IS APRIL 1, 1934, AND WITH RESPECT TO PAYMENTS ON AND AFTER SUCH DATE TO EMPLOYEES IN FOREIGN COUNTRIES COMING WITHIN THE TERMS OF THE ORDER, SECTION 5 PROVIDES THAT:

5. FROM AND AFTER THE EFFECTIVE DATE OF THIS ORDER, EACH EMPLOYEE SHALL BE ENTITLED TO RECEIVE IN FOREIGN CURRENCY SUCH AMOUNT AS HE WOULD HAVE RECEIVED BY CONVERTING INTO SUCH FOREIGN CURRENCY, AT THE BASIC RATES SPECIFIED IN SECTION 4, HIS NET SALARY AND NET ALLOWANCES, OR HIS NET PAY AND ALLOWANCES, AS PROVIDED IN SECTION 3.

THE QUESTIONS PRESENTED ARE UNDERSTOOD AS RELATING TO THE APPLICATION TO BE GIVEN TO SECTION 5 OF THE ORDER IN RESPECT OF ACCRUALS PRIOR TO THE EFFECTIVE DATE, NAMELY, APRIL 1, 1934.

WHILE IT IS PROVIDED IN SECTION 5 OF THE ORDER THAT EACH EMPLOYEE SHALL BE ENTITLED TO RECEIVE IN FOREIGN CURRENCY SUCH AMOUNT AS HE WOULD HAVE RECEIVED BY CONVERTING INTO SUCH CURRENCY, AT THE BASIC RATES SPECIFIED IN SECTION 4 OF THE EXECUTIVE ORDER, THAT PORTION OF HIS NET ALLOWANCES AND NET SALARY DEEMED TO HAVE BEEN CONVERTED AS PROVIDED BY SECTION 3, THERE IS NO REQUIREMENT THAT PAYMENTS BE MADE ONLY IN FOREIGN CURRENCY. SEE DECISION TO THE SECRETARY OF STATE UNDER DATE OF MAY 4, 1934, A-44014. THE EVIDENT PURPOSE OF SECTION 5 WAS TO GIVE THE EMPLOYEE THE AMOUNT OF FOREIGN CURRENCY HE WOULD HAVE RECEIVED PRIOR TO THE APPRECIATION OF FOREIGN CURRENCY IN ITS RELATION TO THE AMERICAN DOLLAR, REGARDLESS OF WHETHER HE IS PAID IN SUCH FOREIGN CURRENCY OR ITS EQUIVALENT IN UNITED STATES CURRENCY. IN PREPARING THE REGULATIONS IT MUST HAVE BEEN KNOWN TO THE PRESIDENT THAT PAYMENTS ON AND AFTER APRIL 1, 1934, WOULD, OF NECESSITY, IN SOME INSTANCES, COVER ACCRUALS PRIOR TO APRIL 1, 1934, AND IT MAY BE SAID, THEREFORE, THAT SECTION 5 OF THE ORDER HAS REFERENCE TO THE DATE OF PAYMENT AND CONVERSION INTO FOREIGN CURRENCY RATHER THAN TO THE PERIOD UNDER WHICH THE PAY, ETC., ACCRUES.