A-59837, FEBRUARY 9, 1935, 14 COMP. GEN. 617

A-59837: Feb 9, 1935

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PERSONAL SERVICE ACCOUNTS - VIRGIN ISLANDS COMPANY AS THE CAPITAL OF THE VIRGIN ISLANDS COMPANY IS DERIVED FROM APPROPRIATED FUNDS. THIS WORK HAS BEEN COMPLETED AND THE REPRESENTATIVES OF YOUR OFFICE HAVE USED THIS REPORT IN CONNECTION WITH THE GENERAL SYSTEM OF ACCOUNTS PROVIDED FOR IN YOUR LETTER OF NOVEMBER 22. CROIX HAVE MADE CONTINUAL REFERENCE TO THIS REPORT IN CONNECTION WITH THE INSTALLATION OF A COST ACCOUNTING SYSTEM. THERE IS ENCLOSED HEREWITH AN APPROVAL OF THE STOCKHOLDERS OF THE VIRGIN ISLANDS COMPANY FOR THE PAYMENT OF THE BILL OF PHAGAN. THERE IS ALSO ENCLOSED A VOUCHER COVERING THIS PAYMENT WITH A PREAUDIT STATEMENT. 000 FOR OPERATING CAPITAL AND IN VIEW OF THE FACT THAT THIS MONEY IS TO BE REPAID AND THAT THE COST SYSTEM AS SET UP BY THE ACCOUNTANTS IS AN AUTHORIZED EXPENSE OF THE COMPANY.

A-59837, FEBRUARY 9, 1935, 14 COMP. GEN. 617

PERSONAL SERVICE ACCOUNTS - VIRGIN ISLANDS COMPANY AS THE CAPITAL OF THE VIRGIN ISLANDS COMPANY IS DERIVED FROM APPROPRIATED FUNDS, IT MAY NOT BE USED FOR THE HIRE OF A FIRM OF CERTIFIED PUBLIC ACCOUNTANTS TO PROVIDE A SYSTEM OF ACCOUNTS AND COST SYSTEM FOR THAT COMPANY, SUCH USE OF APPROPRIATED FUNDS BEING IN CONTRAVENTION OF SECTION 5 OF THE ACT OF APRIL 6, 1914, 38 STAT. 335.

COMPTROLLER GENERAL MCCARL TO THE CHAIRMAN, BOARD OF DIRECTORS, THE VIRGIN ISLANDS COMPANY, FEBRUARY 9, 1935:

THERE HAS BEEN RECEIVED YOUR LETTER OF JANUARY 16, 1935, AS FOLLOWS:

AT THE MEETING OF APRIL 16, 1934, THE STOCKHOLDERS OF THE VIRGIN ISLANDS COMPANY AUTHORIZED THE PRESIDENT OF THE COMPANY TO ENGAGE CERTIFIED PUBLIC ACCOUNTANTS TO PROVIDE FOR A SYSTEM OF GENERAL ACCOUNTS AND A COST SYSTEM. THIS WORK HAS BEEN COMPLETED AND THE REPRESENTATIVES OF YOUR OFFICE HAVE USED THIS REPORT IN CONNECTION WITH THE GENERAL SYSTEM OF ACCOUNTS PROVIDED FOR IN YOUR LETTER OF NOVEMBER 22, 1934. YOUR REPRESENTATIVES IN ST. CROIX HAVE MADE CONTINUAL REFERENCE TO THIS REPORT IN CONNECTION WITH THE INSTALLATION OF A COST ACCOUNTING SYSTEM.

THERE IS ENCLOSED HEREWITH AN APPROVAL OF THE STOCKHOLDERS OF THE VIRGIN ISLANDS COMPANY FOR THE PAYMENT OF THE BILL OF PHAGAN, TILLISON AND TREMBLE. THERE IS ALSO ENCLOSED A VOUCHER COVERING THIS PAYMENT WITH A PREAUDIT STATEMENT.

THE VIRGIN ISLANDS COMPANY BORROWED $150,000 FOR OPERATING CAPITAL AND IN VIEW OF THE FACT THAT THIS MONEY IS TO BE REPAID AND THAT THE COST SYSTEM AS SET UP BY THE ACCOUNTANTS IS AN AUTHORIZED EXPENSE OF THE COMPANY, CHARGEABLE TO THE ABOVE $150,000, IT WILL BE APPRECIATED IF YOU WILL GIVE THIS MATTER YOUR CONSIDERATION AND APPROVE THE VOUCHER FOR PAYMENT.

SECTION 5 OF THE ACT OF APRIL 6, 1914, 38 STAT. 335, PROVIDES:

THAT NO PART OF ANY MONEY APPROPRIATED IN THIS OR ANY OTHER ACT SHALL BE USED FOR COMPENSATION OR PAYMENT OF EXPENSES OF ACCOUNTANTS OR OTHER EXPERTS IN INAUGURATING NEW OR CHANGING OLD METHODS OF TRANSACTING THE BUSINESS OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA UNLESS AUTHORITY FOR EMPLOYMENT OF SUCH SERVICES OR PAYMENT OF SUCH EXPENSES IS STATED IN SPECIFIC TERMS IN THE ACT MAKING PROVISION THEREFOR AND THE RATE OF COMPENSATION FOR SUCH SERVICES OR EXPENSES IN SPECIFICALLY FIXED THEREIN, OR BE USED FOR COMPENSATION OF OR EXPENSES FOR PERSONS, AIDING OR ASSISTING SUCH ACCOUNTANTS OR OTHER EXPERTS, UNLESS THE RATE OF COMPENSATION OF OR EXPENSES FOR SUCH ASSISTANTS IS FIXED BY OFFICERS OR EMPLOYEES OF THE UNITED STATES OR DISTRICT OF COLUMBIA HAVING AUTHORITY TO DO SO, AND SUCH RATES OF COMPENSATION OR EXPENSES SO FIXED SHALL BE PAID ONLY TO THE PERSON SO EMPLOYED.

AS THE CAPITAL OF THE VIRGIN ISLANDS COMPANY IS DERIVED FROM APPROPRIATED FUNDS, THE ABOVE STATUTE IS APPLICABLE THERETO AND THIS OFFICE IS WITHOUT AUTHORITY TO WAIVE THIS STATUTORY PROHIBITION. ACCORDINGLY, PAYMENT OF THE VOUCHER FOR SERVICES OF CERTIFIED PUBLIC ACCOUNTANTS IS NOT AUTHORIZED. 1 COMP. GEN. 93; ID. 252; 5 ID. 608; A 53936, APRIL 6, 1934.