A-60113, APRIL 10, 1936, 15 COMP. GEN. 886

A-60113: Apr 10, 1936

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ARSENAL ACCOUNTING ADJUSTMENTS WILL NOT BE REQUIRED. AS OLLOWS: REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 14. IT IS BELIEVED THAT PREVIOUS CORRESPONDENCE MAY NOT HAVE BEEN CLEAR WITH RESPECT TO THE METHODS OF OPERATING OUR MANUFACTURING ARSENALS AND THE APPROPRIATIONS AVAILABLE FOR THE PAYMENT OF EMPLOYEES UTILIZED FOR THE PREPARATION OF MATERIAL FOR SALE IN ADVANCE OF THE RECEIPT OF PROCEEDS OF SALES. NO GENERAL APPROPRIATION IS MADE AVAILABLE TO THE ORDNANCE DEPARTMENT FOR ADMINISTRATIVE PURPOSES OR INDIRECT EXPENSE. ALL FUNDS APPROPRIATED ARE FOR THE FULFILLMENT OF A DEFINITE ACTIVITY OR THE PROCUREMENT OF SPECIFIC MATERIAL. THERE IS NO REGULAR PERMANENT OR SEMI-PERMANENT ORGANIZATION MAINTAINED AT ANY ORDNANCE ESTABLISHMENT WHATSOEVER.

A-60113, APRIL 10, 1936, 15 COMP. GEN. 886

ARSENALS - PROCEEDS OF SALE OF SCRAP MATERIALS - EXPENSES PROPERLY DEDUCTIBLE DEDUCTION MAY NOT BE MADE FROM THE PROCEEDS OF SALES OF SCRAP MATERIAL, ETC., AT ARSENALS FOR THE VALUE OF SERVICES PERFORMED BY EMPLOYEES OF THE MANUFACTURING FORCE ASSIGNED TO SALES WORK, NOR FOR THE VALUE OF ARSENAL EQUIPMENT USED IN CONNECTION THEREWITH, BUT THERE MAY BE DEDUCTED DIRECT SALES ITEMS SUCH AS AUCTIONEERS' FEES AND LIKE EXPENSES. ARSENAL ACCOUNTING ADJUSTMENTS WILL NOT BE REQUIRED, HOWEVER, IN RESPECT OF THESE MATTERS FOR SALES CONSUMMATED PRIOR TO JULY 1, 1936.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF WAR, APRIL 10, 1936:

WITH REFERENCE TO MY LETTER TO YOU OF AUGUST 14, 1935, RELATIVE TO THE MATTER OF THE PRACTICE OF CERTAIN DISBURSING OFFICERS OF YOUR DEPARTMENT IN ACCOUNTING FOR MONEYS DERIVED FROM THE SALE OF "OLD MATERIAL, CONDEMNED STORES, SUPPLIES, OR OTHER PUBLIC PROPERTY OF ANY KIND," APPEARING NOT TO BE IN CONFORMITY WITH THE CONTROLLING STATUTES, THE DECISIONS OF THIS OFFICE, AND REGULATIONS OF YOUR DEPARTMENT, THERE HAS BEEN RECEIVED YOUR REPLY OF OCTOBER 11, 1935, AS OLLOWS:

REFERENCE IS MADE TO YOUR LETTER DATED AUGUST 14, 1935, A-60113, RELATIVE TO THE USE BY VARIOUS DISBURSING OFFICERS IN THE WAR DEPARTMENT OF FUNDS DERIVED FROM THE SALE OF MATERIAL TOWARD COVERING THE EXPENSE OF SALE.

INSOFAR AS THIS MATTER PERTAINS TO THE ORDNANCE DEPARTMENT, IT IS BELIEVED THAT PREVIOUS CORRESPONDENCE MAY NOT HAVE BEEN CLEAR WITH RESPECT TO THE METHODS OF OPERATING OUR MANUFACTURING ARSENALS AND THE APPROPRIATIONS AVAILABLE FOR THE PAYMENT OF EMPLOYEES UTILIZED FOR THE PREPARATION OF MATERIAL FOR SALE IN ADVANCE OF THE RECEIPT OF PROCEEDS OF SALES.

NO GENERAL APPROPRIATION IS MADE AVAILABLE TO THE ORDNANCE DEPARTMENT FOR ADMINISTRATIVE PURPOSES OR INDIRECT EXPENSE. ALL FUNDS APPROPRIATED ARE FOR THE FULFILLMENT OF A DEFINITE ACTIVITY OR THE PROCUREMENT OF SPECIFIC MATERIAL. THEREFORE, THERE IS NO REGULAR PERMANENT OR SEMI-PERMANENT ORGANIZATION MAINTAINED AT ANY ORDNANCE ESTABLISHMENT WHATSOEVER. EMPLOYEES OF THESE ESTABLISHMENTS ARE CLASSIFIED AS PERMANENT ONLY WITH RESPECT TO CLASSIFICATIONS PRESCRIBED BY THE CIVIL SERVICE REGULATIONS. AS A CONSEQUENCE, THE NUMBER OF PEOPLE EMPLOYED AT OUR MANUFACTURING ESTABLISHMENTS RISES AND FALLS, DEPENDENT UPON APPROPRIATIONS FOR SPECIFIC PURPOSES MADE BY CONGRESS EACH YEAR. FURTHERMORE, THE TYPES OF PERSONNEL EMPLOYED AT OUR ORDNANCE ESTABLISHMENTS ARE CONTINGENT UPON THE KINDS OF MATERIALS FOR WHICH CONGRESS APPROPRIATES FUNDS AND THE ITEMS PLACED BY OUTSIDE AGENCIES FOR MANUFACTURE BY THE ORDNANCE DEPARTMENT. FOR EXAMPLE, IN THE FISCAL YEAR 1934 THE REGULAR APPROPRIATIONS CONTAINED PRACTICALLY NO FUNDS FOR THE ACTIVITIES FOR WHICH THE WATERVLIET ARSENAL IS EQUIPPED. ABOUT SEPTEMBER 1933 ORDERS WERE RECEIVED FROM THE NAVY DEPARTMENT COVERING WORK WHICH COULD BE GIVEN TO WATERVLIET ARSENAL. THIS RESULTED IN MORE THAN 80 PERCENT OF THE PERSONNEL AT THAT ESTABLISHMENT BEING ENGAGED ON NAVY WORK AND PAID FROM FUNDS RECEIVED FROM THAT DEPARTMENT. IF ANY ATTEMPT HAD BEEN MADE TO DISPOSE OF SCRAP MATERIALS AND THE INCIDENTAL COSTS OF SUCH SALES HAD BEEN CHARGED TO FUNDS ON THE BOOKS OF THE ARSENAL WITHOUT REIMBURSEMENT FROM THE PROCEEDS OF SALE, THE NAVY DEPARTMENT'S APPROPRIATIONS WOULD HAVE BEEN CHARGED ILLEGALLY WITH THE COST OF SUCH WORK. SUCH SALES AT OUR MANUFACTURING ESTABLISHMENTS ARE SPORADIC AND QUITE OFTEN NO SALE WILL BE HELD DURING ANY ONE FISCAL YEAR. IT WOULD THEREFORE BE INADVISABLE TO REQUEST CONGRESS FOR APPROPRIATE ACTION TO SUPPLY AN ORGANIZATION OF CIVILIAN EMPLOYEES TO HANDLE THE ADMINISTRATIVE AND ACCOUNTING WORK IN CONNECTION WITH THE SURVEY, APPRAISAL, AND SALE OF SURPLUS OR CONDEMNED PROPERTY GENERALLY, SINCE THERE IS NO APPROPRIATION AVAILABLE FOR THE EMPLOYMENT OF SUCH A FORCE, AND NO NEED OF ITS MAINTENANCE AT OUR MANUFACTURING ESTABLISHMENTS.

WHILE THE ACT OF MARCH 2, 1907, 34 STAT. 1062, PERTAINING TO THE MATTER OF "CONDUCTING MANUFACTURING OR SIMILAR OPERATIONS" HAS NO BEARING UPON THE DISPOSAL OF "OLD MATERIALS, CONDEMNED STORES, SUPPLIES, OR OTHER PUBLIC PROPERTY OF ANY KIND" COVERED BY THE ACT OF JUNE 8, 1896, THE QUOTATION OF THE ACT OF MARCH 2, 1907, BY THE CHIEF OF ORDNANCE AS SET FORTH ON PAGE 3 OF YOUR LETTER, WOULD INDICATE THAT THE SHOP EXPENSE ACCOUNT WAS THE MOST APPROPRIATE ONE TO WHICH TEMPORARY CHARGES COULD BE MADE PENDING THE RECEIPT OF THE PROCEEDS OF SALE.

WHEN MATERIAL ACCUMULATES AT AN ORDNANCE ESTABLISHMENT SO THAT A SALE IS INVOLVED, THE EXPENSES INCURRED IN THE PREPARATION OF THE MATERIAL FOR SALE MUST BE PAID IN ADVANCE OF THE RECEIPT OF THE PROCEEDS OF SALE. THE ACT OF JUNE 8, 1896, 29 STAT. 268, AND PARAGRAPH 30 OF ARMY REGULATIONS 30 -2145 GIVE THE AUTHORITY FOR AND LIST THE ITEMS OF EXPENSE THAT MAY BE FINANCED WITH THE PROCEEDS OF SALE. WHEN SUCH SERVICES AS ARE APPLICABLE DIRECTLY FOR THE HANDLING AND LOADING OF THE SCRAP MATERIAL ARE CHARGED TO THE PROCEEDS OF SALE, SINCE THERE IS NO APPROPRIATION AVAILABLE FOR PAYMENT OF THE EXPENSE OF SALE PRIOR TO ITS CONSUMMATION,SUCH EXPENSES HAVE BEEN CONSIDERED CHARGES PROPERLY ASSESSED TEMPORARILY AGAINST THE SHOP EXPENSE ACCOUNT UNTIL REIMBURSEMENT COULD BE MADE FROM THE PROCEEDS OF SALES. ACCORDINGLY, WHEN THE OCCASION FOR A SALE ARISES, EMPLOYEES ARE DIVERTED FROM PRODUCTIVE WORK UNDER SPECIFIC APPROPRIATIONS MADE BY CONGRESS IN ORDER THAT THE SERVICES INCIDENTAL TO THE PREPARATION OF THE MATERIAL FOR SUCH SALE MAY BE PERFORMED WITHOUT HIRING ADDITIONAL TEMPORARY EMPLOYEES. THE TIME OF THESE EMPLOYEES AND THE SERVICES OF UTILITIES CONNECTED WITH THIS PREPARATORY WORK ARE CHARGED TEMPORARILY TO THE SHOP EXPENSE ACCOUNT, AND SUCH CHARGES STAND UNTIL THE SALE HAS BEEN MADE AND REIMBURSEMENT COMPLETED FROM THE PROCEEDS.

WHILE SUCH CHARGES STAND TEMPORARILY AGAINST THE SHOP EXPENSE ACCOUNT, THEY DO NOT CAUSE AUGMENTATION OF APPROPRIATIONS WITHIN THAT ACCOUNT. SUCH CHARGES FOR THE SERVICES RENDERED IN CONNECTION WITH THE SALE CAUSE A TEMPORARY DEPLETION OF FUNDS FOR SPECIFIC PURPOSES WHICH HAVE BEEN DIVERTED TO THE SHOP EXPENSE ACCOUNT IN THE PROPER MANNER, AND SUCH DEPLETION IS MERELY MADE UP WHEN REIMBURSEMENT IS EFFECTED.

THEREFORE, THE USE OF THE SHOP EXPENSE ACCOUNT FOR THE PURPOSE OF CHARGING TEMPORARILY THE TIME OF EMPLOYEES FOR WORK WHICH CANNOT BE CHARGED TO ANY SPECIFIC APPROPRIATION MADE TO OUR ORDNANCE ESTABLISHMENTS SEEMS REASONABLE AND A PROPER ACCOUNTING PROCEDURE. THE VARIOUS APPROPRIATIONS IN THE SHOP EXPENSE ACCOUNT WHICH HAVE BEEN TEMPORARILY CHARGED FOR THE EXPENSES OF THE SALE OF SUCH SCRAP MATERIALS ARE REIMBURSED PROPERLY AFTER THE PROCEEDS OF SALE ARE AVAILABLE. FUNDS IN THE SHOP EXPENSE ACCOUNT ARE ACCRUED TO MEET THE ACTUAL NEEDS OF THE ACCOUNT. NO EXCESSES ARE PERMITTED TO ACCUMULATE. NO GREATER USE OF ANY APPROPRIATION IN THIS ACCOUNT CAN BE MADE OVER AND ABOVE THAT AUTHORIZED BY CONGRESS, AS THE FUNDS THEREUNDER FOR PAYMENT OF SERVICES OR MATERIALS ARE NOT AUGMENTED IN ANY WAY.

IN SUMMATION, THEREFORE, IT IS BELIEVED THAT THE PROCEDURE UTILIZED FOR MANY YEARS BY THE ORDNANCE DEPARTMENT IS A PROPER ONE IN THE ACCOUNTING FOR ALL FUNDS RECEIVED FROM PROCEEDS OF SALES.

FROM THE LETTER, SUPRA, AND PRIOR CORRESPONDENCE IN THE MATTER, THE FACTS APPEAR TO BE (1) THAT NO SPECIFIC APPROPRIATION IS MADE TO THE ORDNANCE DEPARTMENT FOR ADMINISTRATIVE, SUPERVISORY, OR INDIRECT EXPENSES INCIDENT TO THE MANUFACTURE OF ORDNANCE MATERIAL, EQUIPMENT, ETC., BY THE SEVERAL ARSENALS--- THE MONEY APPROPRIATED ANNUALLY FOR THE ORDNANCE STORES, SUPPLIES, ETC., BEING FOR THE FULFILLMENT OF A DEFINITE ACTIVITY OR THE PROCUREMENT OF SPECIFIC MATERIAL; (2) THAT THE FUNDS USED FOR THE HIRE OF PERSONNEL IN CONNECTION WITH MANUFACTURING ORDNANCE SUPPLIES AND MATERIALS AT EACH OF THE SEVERAL ARSENALS COMPRISE APPROPRIATED MONEYS ALLOTTED FROM VARIOUS SOURCES TO THE SEVERAL ARSENALS FOR SUCH EQUIPMENT, MATERIALS, ETC., AS MAY BE MANUFACTURED AT EACH SUCH ARSENAL FOR THE PARTICULAR REQUISITIONING DEPARTMENT OR BUREAU OF THE GOVERNMENT--- SUCH FUNDS CONSTITUTING THE SO-CALLED SHOP-EXPENSE ACCOUNT MAINTAINED AT EACH OF THE ARSENALS AND ESTABLISHED PURSUANT TO THE ACT OF MARCH 2, 1907, 34 STAT. 1062; (3) THAT THERE IS NOT MAINTAINED AT ANY OF THE ARSENALS A REGULAR, PERMANENT, OR SEMIPERMANENT SALES FORCE IN CONNECTION WITH THE SALE OF SCRAP MATERIAL, ETC., BUT THAT, ON THE CONTRARY, SUCH FORCE AS IS NECESSARY TO CONSUMMATE A PARTICULAR SALE CONSISTS OF PERSONNEL DETAILED FROM THE MANUFACTURING FORCE; (4) THAT THE COST OF THE PERSONNEL THUS DETAILED IS PAID FROM FUNDS IN A SPECIAL DEPOSIT ACCOUNT IF THERE BE AVAILABLE THEREIN PROCEEDS OF SALE OF OTHER SIMILAR MATERIAL, OR, IF THERE BE NO SUCH FUNDS IN THE SPECIAL DEPOSIT ACCOUNT, THEN FROM THE SHOP- EXPENSE ACCOUNT--- IN EACH CASE SUCH COST BEING DEDUCTED FROM THE PROCEEDS OF THE PARTICULAR SALE AND ONLY THE REMAINDER DEPOSITED AS MISCELLANEOUS RECEIPTS--- THE SHOP-EXPENSE ACCOUNT, HOWEVER, BEING REIMBURSED FOR ANY CHARGE MADE AGAINST IT IN CONNECTION WITH ANY PARTICULAR SALE; AND (5) THAT IN CASE ANY ARSENAL EQUIPMENT IS USED IN CONNECTION WITH A SALE--- FOR INSTANCE, CRANES, DERRICKS, LOCOMOTIVES, ETC.--- THE VALUE OF THE USE OF SUCH EQUIPMENT IN RESPECT OF A SALE IS ESTIMATED AND DEDUCTED FROM THE PROCEEDS OF SALE FOR THE PURPOSE OF REIMBURSING THE APPROPRIATION FROM WHICH SUCH EQUIPMENT WAS PURCHASED IN THE FIRST INSTANCE.

THE ACT OF JUNE 8, 1896, 29 STAT. 268, REFERRED TO IN YOUR LETTER, SUPRA, DIRECTED THAT FROM THE PROCEEDS OF SALES OF OLD MATERIALS, CONDEMNED STORES, SUPPLIES, OR OTHER PUBLIC PROPERTY OF ANY KIND, BEFORE BEING DEPOSITED INTO THE TREASURY EITHER AS MISCELLANEOUS RECEIPTS OR TO THE CREDIT OF THE APPROPRIATIONS TO WHICH SUCH PROCEEDS ARE AUTHORIZED BY LAW TO BE MADE, THERE MIGHT BE PAID THE EXPENSES OF SUCH SALES AS APPROVED BY THE "ACCOUNTING OFFICERS OF THE TREASURY" (NOW GENERAL ACCOUNTING OFFICE), SO AS TO REQUIRE ONLY THE NET PROCEEDS OF SUCH SALES TO BE DEPOSITED INTO THE TREASURY. UNDER INSTRUCTIONS PRESCRIBED BY THE COMPTROLLER OF THE TREASURY AND APPROVED BY THE SECRETARY OF THE TREASURY UNDER AUTHORITY OF SAID ACT, TREASURY DEPARTMENT CIRCULAR NO. 6, DATED JANUARY 9, 1897, 3 COMP. DEC. 744, AND WHICH HAVE BEEN CONSISTENTLY FOLLOWED BY THE ACCOUNTING OFFICERS SINCE THAT TIME, THE EXPENSES OF SALES PAYABLE FROM GROSS PROCEEDS OF SALES OF SURPLUS GOVERNMENT PROPERTY ARE LIMITED TO THOSE PERTAINING DIRECTLY TO THE SALES SUCH AS AUCTIONEERS' FEES, CARTAGE TO PLACE OF SALE, COST OF INSPECTION, IF AN INSPECTOR BE HIRED FOR THAT PURPOSE, AND SUCH LIKE EXPENSES. IN THIS CONNECTION SEE AR 30-2145.

NOTWITHSTANDING THAT NO DIRECT APPROPRIATION IS MADE TO THE ORDNANCE DEPARTMENT FOR THE HIRE OF PERSONNEL IN CONNECTION WITH MANUFACTURING PROJECTS WHICH THE SEVERAL ARSENALS ARE CALLED UPON TO PERFORM UNDER EXISTING STATUTES, THE FACT REMAINS THAT APPROPRIATIONS ARE INDIRECTLY MADE AVAILABLE THEREFOR THROUGH THE USE OF THE SHOP-EXPENSE ACCOUNT ESTABLISHED FOR EACH OF THE SEVERAL ARSENALS BY VIRTUE OF THE ACT OF MARCH 2, 1907, 34 STAT. 1062--- SAID SHOP-EXPENSE ACCOUNT COMPRISING APPROPRIATED MONEYS ALLOTTED FROM VARIOUS SOURCES TO THE SEVERAL ARSENALS FOR SUCH EQUIPMENT, MATERIALS, ETC., AS MAY BE MANUFACTURED AT EACH SUCH ARSENAL FOR THE PARTICULAR REQUISITIONING DEPARTMENT OR BUREAU OF THE GOVERNMENT. THE DETAILING OF EMPLOYEES OF THE MANUFACTURING FORCE, THE EXISTENCE OF WHICH FORCE IS MADE POSSIBLE THROUGH THE USE OF APPROPRIATED FUNDS IN THE SHOP-EXPENSE ACCOUNT, TO WORK INCIDENT TO THE SALE OF SCRAP MATERIALS, ETC., AT ARSENALS, CAN CREATE NO DIFFERENT SITUATION FROM AN APPROPRIATION ACCOUNTING STANDPOINT FROM THAT PRESENTED IN CASES WHERE REGULAR EMPLOYEES OF A PARTICULAR DEPARTMENT OR BUREAU ARE DETAILED TO WORK INCIDENT TO THE SALE OF SURPLUS MATERIAL, ETC., OF THE PARTICULAR DEPARTMENT OR BUREAU CONCERNED. SINCE, IN THE LATTER CLASS OF CASES, THE EMPLOYEES ARE PAID FROM FUNDS PROVIDED FOR BY THE CONGRESS, THE EXPENSES REPRESENTING THE VALUE OF THE SERVICES PERFORMED BY THE EMPLOYEES SO DETAILED IS NOT CONSIDERED AS AN EXPENSE OF THE SALE ITSELF WITHIN THE MEANING OF THE 1896 ACT AND AR-30-2145. (SEE 3 COMP. DEC. 744; ALSO, 5 COMP. GEN. 680 (683).) HENCE, THERE SHOULD NOT BE DEDUCTED FROM THE PROCEEDS OF SALE OF SCRAP MATERIAL, ETC., AT ARSENALS THE VALUE OF THE SERVICES PERFORMED BY SUCH PERSONNEL OF THE MANUFACTURING FORCE AS MAY BE ASSIGNED TO SALES WORK. TO ALL INTENTS AND PURPOSES--- INSOFAR AS THE QUESTION HEREIN INVOLVED IS CONCERNED--- THE SHOP-EXPENSE ACCOUNT ESTABLISHED PURSUANT TO THE ACT OF MARCH 2, 1907, 34 STAT. 1062, MAY BE AS THE APPROPRIATION OF THE PARTICULAR ARSENAL FOR THE EMPLOYMENT OF A MANUFACTURING FORCE. THERE WOULD APPEAR TO BE NO QUESTION BUT THAT THE SALE OF SCRAP MATERIALS, ETC., AT ARSENALS CONSTITUTES A NECESSARY INCIDENT OF MANUFACTURE AND IN THE ENACTMENT OF THE 1907 STATUTE UNDER WHICH THERE WAS ESTABLISHED THE SHOP-EXPENSE ACCOUNT IT MUST BE ASSUMED THAT THE CONGRESS WAS AWARE OF THE PROVISIONS OF THE 1896 STATUTE AND OF THE ITEMS OF EXPENSES OF SALES WHICH HAD BEEN "APPROVED BY THE ACCOUNTING OFFICERS OF THE TREASURY.' TO SAY THAT THE SALE OF SCRAP MATERIAL, ETC., IS NOT A NECESSARY INCIDENT OF MANUFACTURE IS TO ADMIT THAT THE CHARGE AGAINST THE SHOP-EXPENSE ACCOUNT FOR THE COST OF PERSONNEL DETAILED FROM THE MANUFACTURING FORCE IN CONNECTION WITH ANY PARTICULAR SALE CONSTITUTES A VIOLATION OF SECTION 3678, REVISED STATUTES, WHICH PROVIDES THAT ALL SUMS APPROPRIATED FOR THE VARIOUS BRANCHES OF EXPENDITURE IN THE PUBLIC SERVICE SHALL BE APPLIED SOLELY TO THE OBJECTS FOR WHICH THEY ARE RESPECTIVELY MADE AND FOR NO OTHERS. SINCE THE PERSONNEL DETAILED TO SALES WORK CONSISTS OF PERSONNEL HIRED FOR MANUFACTURING PURPOSES IN CONNECTION WITH APPROPRIATED FUNDS PROVIDED FOR THROUGH OPERATION OF THE SHOP-EXPENSE ACCOUNT AS DISTINGUISHED FROM TEMPORARY PERSONNEL HIRED FOR THE PARTICULAR PURPOSE OF A SALE, SUCH EXPENSE MUST BE DEEMED IN THE NATURE OF AN ADMINISTRATIVE EXPENSE AND NOT REIMBURSABLE FROM PROCEEDS OF SALE--- THE REIMBURSEMENT IN SUCH CASES BEING IN EFFECT AN AUGMENTATION OF THE APPROPRIATION OR APPROPRIATIONS CONSTITUTING THE SHOP-EXPENSE ACCOUNT. THE SAME RULE APPLIES IN THE CASE OF ARSENAL EQUIPMENT SUCH AS LOCOMOTIVES, CRANES, ETC., USED IN CONNECTION WITH ANY PARTICULAR SALE, THAT IS TO SAY, THE APPROPRIATION USED TO PURCHASE SUCH EQUIPMENT MAY NOT BE REIMBURSED FROM PROCEEDS OF SALE IN CONNECTION WITH WHICH THE PARTICULAR EQUIPMENT WAS TEMPORARILY USED--- THE GROSS AMOUNT OF SALES IN SUCH CASES BEING FOR DEPOSIT AS MISCELLANEOUS RECEIPTS. SEE, GENERALLY, SECTIONS 3617 AND 3618, REVISED STATUTES; ALSO A-38313, DECEMBER 12, 1935.

NOTWITHSTANDING THE ALLEGED EFFICIENCY OF THE ACCOUNTING METHODS EMPLOYED IN CONNECTION WITH THE OPERATION OF THE SHOP-EXPENSE ACCOUNT, IT CAN BE SEEN FROM THE FOREGOING THAT THERE IS NO WARRANT OF LAW FOR THE ACCOUNTING PRACTICE OBTAINING AT THE SEVERAL ARSENALS IN RESPECT OF SALES OF SCRAP MATERIAL, ETC. HOWEVER, IN VIEW OF THE LONG CONTINUED PRACTICE IN THIS MATTER, NO ADJUSTMENTS WILL BE REQUIRED IN THESE CASES IN RESPECT OF ANY SALE CONSUMMATED PRIOR TO JULY 1, 1936. BUT UNLESS LEGISLATIVE AUTHORITY BE OBTAINED IN THE MEANTIME FOR THE PRACTICE IN QUESTION, ADJUSTMENTS WILL BE REQUIRED IN THE ACCOUNTS OF DISBURSING OFFICERS CONCERNED IN RESPECT OF SALES CONSUMMATED ON AND AFTER SAID DATE.