B-21378, DECEMBER 20, 1941, 21 COMP. GEN. 598

B-21378: Dec 20, 1941

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IS UNAUTHORIZED. FOR WHICH THE CONTRACTOR IS TO BE REIMBURSED "FOR ALL COSTS AND EXPENSES OF EVERY CHARACTER AND DESCRIPTION INCURRED IN THE PERFORMANCE OF THE WORK. REIMBURSEMENT WILL BE MADE WEEKLY BUT MAY BE MADE AT MORE FREQUENT INTERVALS IF THE CONDITIONS SO WARRANT. AMONG THE GENERAL PROVISIONS OF THE CONTRACT HAVING TO DO WITH THE VERIFICATION OF THE CONTRACTOR'S COSTS FOR WHICH REIMBURSEMENT IS AUTHORIZED IS ARTICLE VI-E. OTHER EXPENDITURES OF WHATEVER NATURE FOR WHICH REIMBURSEMENT IS AUTHORIZED UNDER THE PROVISIONS OF THIS CONTRACT. THE SYSTEM OF ACCOUNTING TO BE EMPLOYED BY THE CONTRACTOR SHALL BE SUCH AS IS SATISFACTORY TO THE CONTRACTING OFFICER. 2. SHALL AT ALL TIMES HAVE ACCESS TO THE PREMISES.

B-21378, DECEMBER 20, 1941, 21 COMP. GEN. 598

CONTRACTS - COST-PLUS - ADMINISTRATIVE PREAUDIT OF PAYMENTS BY CONTRACTOR; EFFECT OF FINAL AUDIT DATE PROVISION A PROVISION IN A COST-PLUS-A-FIXED-FEE CONTRACT NEGOTIATED PURSUANT TO THE ACT OF JULY 2, 1940, UNDER WHICH VENDORS' INVOICES, PAY ROLLS, RENTAL ROLLS, ETC., OF THE CONTRACTOR WOULD BE APPROVED BY ADMINISTRATIVE PERSONNEL OF THE GOVERNMENT PRIOR TO PAYMENT BY THE CONTRACTOR, AND UNDER WHICH THE CONTRACTOR WOULD BE REIMBURSED BY THE GOVERNMENT FOR ANY PAYMENT MADE AFTER SUCH APPROVAL, REGARDLESS OF ITS VALIDITY OR CORRECTNESS, IS UNAUTHORIZED. A PROVISION IN A COST-PLUS-A-FIXED-FEE CONTRACT NEGOTIATED PURSUANT TO THE ACT OF JULY 2, 1940, THAT FINAL AUDIT OF THE ACCOUNTS RELATING TO THE CONTRACT FOR EACH CALENDAR YEAR SHALL BE MADE BY THE GOVERNMENT NOT LATER THAN 6 MONTHS AFTER THE END OF SUCH YEAR CANNOT BE CONSTRUED AS LIMITING THE TIME WITHIN WHICH THE GENERAL ACCOUNTING OFFICE MAY EXERCISE ITS STATUTORY DUTY OF AUDITING THE ACCOUNTS OF THE DISBURSING OFFICER, NOR ITS RIGHT TO REQUIRE FURTHER EVIDENCE IN SUPPORT OF VOUCHERS WHEN NECESSARY.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF WAR, DECEMBER 20, 1941:

THERE HAS BEEN BROUGHT TO MY ATTENTION CONTRACT NO. W-ORD-526-DA-W ORD-1, DATED JUNE 30, 1941, AND SUPPLEMENT THERETO DATED AUGUST 22, 1941, WITH E. I. DUPONT DE NEMOURS AND CO., WILMINGTON, L., NEGOTIATED BY THE WAR DEPARTMENT UNDER AUTHORITY CONTAINED IN THE ACT OF JULY 2, 1940, 54 STAT. 712. SAID CONTRACT PROVIDES FOR DESIGNING, ENGINEERING, CONSTRUCTING, AND EQUIPPING A PLANT FOR THE MANUFACTURE OF EXPLOSIVES, FOR THE TRAINING OF KEY PERSONNEL, AND FOR THE OPERATION OF SAID PLANT, FOR WHICH THE CONTRACTOR IS TO BE REIMBURSED "FOR ALL COSTS AND EXPENSES OF EVERY CHARACTER AND DESCRIPTION INCURRED IN THE PERFORMANCE OF THE WORK," AS DEFINED IN DETAIL IN ARTICLE IV-A OF THE CONTRACT, TOGETHER WITH STIPULATED FIXED FEES FOR THE VARIOUS SPECIFIED PORTIONS OF THE WORK.

WITH RESPECT TO REIMBURSEMENT FOR COSTS INCURRED BY THE CONTRACTOR, ARTICLE IV-B, PARAGRAPH 1-B, PROVIDES:

THE GOVERNMENT SHALL CURRENTLY REIMBURSE THE CONTRACTOR FOR EXPENDITURES MADE IN ACCORDANCE WITH ARTICLE IV-A OF THIS TITLE IV UPON CERTIFICATION TO AND VERIFICATION BY THE CONTRACTING OFFICER OF THE ORIGINAL CERTIFIED PAY ROLLS FOR LABOR, OR THE ORIGINAL PAID INVOICES FOR MATERIALS, OR OTHER ORIGINAL PAPERS, OR OTHER EVIDENCE SATISFACTORY TO THE CONTRACTING OFFICER. REIMBURSEMENT WILL BE MADE WEEKLY BUT MAY BE MADE AT MORE FREQUENT INTERVALS IF THE CONDITIONS SO WARRANT.

AMONG THE GENERAL PROVISIONS OF THE CONTRACT HAVING TO DO WITH THE VERIFICATION OF THE CONTRACTOR'S COSTS FOR WHICH REIMBURSEMENT IS AUTHORIZED IS ARTICLE VI-E, WHICH PROVIDES AS OLLOWS:

1. THE CONTRACTOR AGREES TO KEEP RECORDS AND BOOKS OF ACCOUNT, ON A RECOGNIZED COST-ACCOUNTING BASIS, SHOWING THE ACTUAL COST TO IT OF ALL ITEMS OF LABOR, MATERIALS, EQUIPMENT, SUPPLIES, SERVICES, AND OTHER EXPENDITURES OF WHATEVER NATURE FOR WHICH REIMBURSEMENT IS AUTHORIZED UNDER THE PROVISIONS OF THIS CONTRACT. THE SYSTEM OF ACCOUNTING TO BE EMPLOYED BY THE CONTRACTOR SHALL BE SUCH AS IS SATISFACTORY TO THE CONTRACTING OFFICER.

2. THE CONTRACTING OFFICER SHALL AT ALL TIMES BE AFFORDED PROPER FACILITIES FOR INSPECTION OF THE WORK AND OF THE SPECIAL BANK ACCOUNT OR ACCOUNTS PROVIDED FOR IN ARTICLE IV-C HEREOF, AND SHALL AT ALL TIMES HAVE ACCESS TO THE PREMISES, WORK, AND MATERIALS, TO ALL BOOKS, RECORDS, CORRESPONDENCE, INSTRUCTIONS, PLANS, DRAWINGS, RECEIPTS, VOUCHERS, AND MEMORANDA OF EVERY DESCRIPTION OF THE CONTRACTOR PERTAINING TO SAID WORK; AND THE CONTRACTOR SHALL PRESERVE FOR A PERIOD OF 3 YEARS AFTER COMPLETION OR TERMINATION OF THIS CONTRACT ALL THE BOOKS, RECORDS, AND OTHER PAPERS HEREIN MENTIONED, BUT THE GOVERNMENT UNDERTAKES AND AGREES THAT FINAL AUDIT OF THE ACCOUNTS FOR EACH CALENDAR YEAR SHALL BE MADE BY THE GOVERNMENT NOT LATER THAN SIX MONTHS AFTER THE END OF EACH SUCH YEAR.

3. ANY DULY AUTHORIZED REPRESENTATIVE OF THE CONTRACTOR SHALL BE ACCORDED THE PRIVILEGE OF EXAMINING THE BOOKS, RECORDS, AND PAPERS OF THE CONTRACTING OFFICER RELATING TO THE COST OF THE WORK FOR THE PURPOSE OF CHECKING UP AND VERIFYING SUCH COST.

FROM INFORMATION IN THIS OFFICE IT APPEARS THAT THE WAR DEPARTMENT HAS ISSUED INSTRUCTIONS WHICH ENVISAGE THE DISCONTINUANCE BY THE COST PLUS-A- FIXED-FEE CONTRACTORS OF CERTAIN ACCOUNTING FUNCTIONS RELATING TO THE DETERMINATION OF THE COST OF PERFORMANCE OF THE CONTRACT WORK AND THE ASSUMPTION OF SUCH FUNCTIONS EXCLUSIVELY BY PERSONNEL OF THE WAR DEPARTMENT. THE FUNCTIONS WHICH ARE TO BE ASSUMED BY GOVERNMENT PERSONNEL ARE DESCRIBED IN A MEMORANDUM OF MAY 15, 1941, OF THE DIRECTOR OF PURCHASES AND CONTRACTS, TO INCLUDE:

* * * (1) ALL TIME CHECKING IN THE FIELD AND THE PREPARATION OF ORIGINAL PAY ROLLS FROM ORIGINAL RECORDS OF EMPLOYMENT AND TIME REPORTS FURNISHED BY THE CONTRACTOR; (2) INSPECTION OF MATERIAL RECEIVED; (3) AUDITING VENDOR'S INVOICES IN THE FIRST INSTANCE; (4) CHECKING OF EQUIPMENT RENTALS AND PREPARATION OF RENTAL PAY ROLLS; (5) AUDITING IN THE FIRST INSTANCE OF TRANSPORTATION VOUCHERS; AND (6) SUCH OTHER AUDITING FUNCTIONS AS MAY BE EFFECTIVELY PERFORMED BY GOVERNMENT EMPLOYEES EXCLUSIVELY.

FOR THE EVIDENT PURPOSE OF EFFECTUATING THE POLICY OF TAKING OVER THE CONTRACTOR'S ACCOUNTING FUNCTIONS OF THIS TYPE, THE ABOVE-MENTIONED SUPPLEMENT NO. 1, DATED AUGUST 22, 1941, WAS EXECUTED, PROVIDING, IN PERTINENT PART, THAT ARTICLE VI-E OF THE CONTRACT SHALL BE CHANGED TO READ AS OLLOWS:

1. THE CONTRACTOR AGREES TO KEEP RECORDS AND BOOKS OF ACCOUNT, ON A RECOGNIZED COST-ACCOUNTING BASIS, SHOWING THE ACTUAL COST TO IT OF ALL ITEMS OF LABOR, MATERIALS, EQUIPMENT, SUPPLIES, SERVICES, AND OTHER EXPENDITURES OF WHATEVER NATURE FOR WHICH REIMBURSEMENT IS AUTHORIZED UNDER THE PROVISIONS OF THIS CONTRACT. THE SYSTEM OF ACCOUNTING TO BE EMPLOYED BY THE CONTRACTOR SHALL BE SUCH AS IS SATISFACTORY TO THE CONTRACTING OFFICER.

2. THE CONTRACTING OFFICER SHALL AT ALL TIMES BE AFFORDED PROPER FACILITIES FOR INSPECTION OF THE WORK AND OF THE SPECIAL BANK ACCOUNT OR ACCOUNTS PROVIDED FOR IN ARTICLE IV-C HEREOF, AND SHALL AT ALL TIMES HAVE ACCESS TO THE PREMISES, WORK, AND MATERIALS, TO ALL BOOKS, RECORDS, CORRESPONDENCE, INSTRUCTIONS, PLANS, DRAWINGS, RECEIPTS, VOUCHERS, AND MEMORANDA OF EVERY DESCRIPTION OF THE CONTRACTOR PERTAINING TO SAID WORK; AND THE CONTRACTOR SHALL PRESERVE FOR A PERIOD OF 3 YEARS AFTER COMPLETION OR TERMINATION OF THIS CONTRACT ALL THE BOOKS, RECORDS, AND OTHER PAPERS HEREIN MENTIONED, BUT THE GOVERNMENT UNDERTAKES AND AGREES THAT FINAL AUDIT OF THE ACCOUNTS FOR EACH CALENDAR YEAR SHALL BE MADE BY THE GOVERNMENT NOT LATER THAN SIX MONTHS AFTER THE END OF EACH SUCH YEAR.

3. ANY DULY AUTHORIZED REPRESENTATIVE OF THE CONTRACTOR SHALL BE ACCORDED THE PRIVILEGE OF EXAMINING THE BOOKS, RECORDS, AND PAPERS OF THE CONTRACTING OFFICER RELATING TO THE COST OF THE WORK FOR THE PURPOSE OF CHECKING UP AND VERIFYING SUCH COST.

4. THE FOLLOWING ACCOUNTING AND AUDITING FUNCTIONS SHALL BE PERFORMED EXCLUSIVELY BY THE GOVERNMENT:

A. TIME CHECKING IN THE FIELD, THE PREPARATION AND DELIVERY OF PROPERLY APPROVED ORIGINAL PAY ROLLS TO THE CONTRACTOR FOR PAYMENT, THE PREPARATION OF PAY CHECKS AND DELIVERY OF SAME TO THE CONTRACTOR FOR SIGNATURE, AND THE PREPARATION OF EARNINGS RECORDS.

B. INSPECTION AND CHECKING OF MATERIALS RECEIVED EXCEPT SUCH MATERIALS AS REQUIRE LABORATORY EXAMINATIONS, PERFORMANCE TESTS, OR TECHNICAL KNOWLEDGE IN ORDER TO MAKE PROPER INSPECTION THEREOF, WHICH INSPECTION SHALL BE PERFORMED BY THE CONTRACTOR UPON THE WRITTEN REQUEST OF THE CONTRACTING OFFICER.

C. INSPECTION AND CHECKING OF TOOLS RECEIVED.

D. CHECKING OF EQUIPMENT RENTALS AND THE PREPARATION AND DELIVERY OF PROPERLY APPROVED ORIGINAL RENTAL ROLLS TO THE CONTRACTOR FOR PAYMENT.

E. CHECKING AND AUDITING OF VENDORS' INVOICES AND TRANSPORTATION BILLS, AND PREPARATION AND DELIVERY OF SAME, PROPERLY APPROVED, TO THE CONTRACTOR FOR PAYMENT.

F. SUCH OTHER ACCOUNTING AND AUDITING FUNCTIONS AS MAY BE EFFECTIVELY PERFORMED BY GOVERNMENT EMPLOYEES EXCLUSIVELY AND AS THE CONTRACTING OFFICER AND THE CONTRACTOR MAY MUTUALLY AGREE TO IN WRITING.

5. THE CONTRACTOR SHALL BE RELIEVED OF ALL RESPONSIBILITY FOR ANY FUNCTIONS SO ASSUMED BY THE GOVERNMENT AND FOR THE RESULTS OF ANY PROCEDURES PRESCRIBED THEREUNDER BY THE CONTRACTING OFFICER, SHALL BE ENTITLED TO RELY ON ANY INFORMATION OR APPROVALS FURNISHED BY REPRESENTATIVES OF THE GOVERNMENT IN THE PERFORMANCE OF SUCH FUNCTIONS, AND, NOTWITHSTANDING ANY ERRORS OR OMISSIONS THEREIN, SHALL BE REIMBURSED FOR ALL PAYMENTS MADE ON THE BASIS OF SUCH INFORMATION OR APPROVALS, AND FOR ALL PAYMENTS REQUIRED TO BE MADE SUBSEQUENTLY BY THE CONTRACTOR AS A RESULT OF SUCH ERRORS OR OMISSIONS; AND SHALL BE FURNISHED WITH SIGNED DUPLICATE ORIGINALS OR CERTIFIED TRUE COPIES OF ALL DOCUMENTS WHICH ARE PREPARED, CHECKED, OR AUDITED BY THE GOVERNMENT IN THE PERFORMANCE OF SAID FUNCTIONS, IN ORDER THAT THE RECORDS AND ACCOUNTS OF THE CONTRACTOR SHALL BE FULL AND COMPLETE. IF IN THE PERFORMANCE OF SAID FUNCTIONS THE GOVERNMENT SHALL OMIT THE PREPARATION OF DOCUMENTS DEEMED NECESSARY BY THE CONTRACTOR FOR ITS RECORDS AND ACCOUNTS UNDER THIS CONTRACT, THE CONTRACTOR MAY PREPARE SUCH DOCUMENTS AND SHALL BE REIMBURSED FOR ALL COSTS AND EXPENSES INCIDENT TO SUCH WORK.

IT THUS APPEARS THAT THE WAR DEPARTMENT PROPOSES TO PREPARE, EXAMINE, AUDIT, AND APPROVE PAY ROLLS, EQUIPMENT RENTAL ROLLS, INVOICES FOR MATERIAL, TRANSPORTATION BILLS, INCLUDING THE TIME CHECKING IN THE FIELD, INSPECTION AND CHECKING OF TOOLS AND MATERIALS, BEFORE ANY SUCH PAYMENTS ARE MADE BY THE CONTRACTOR; AND THAT AS TO SUCH APPROVED BILLS THE CONTRACTOR MAY MAKE PAYMENT WITHOUT RESPONSIBILITY FOR THEIR CORRECTNESS AND NOTWITHSTANDING ANY ERRORS THEREIN. THE EFFECT IS AN AGREEMENT TO REIMBURSE THE CONTRACTOR FOR ANY PAYMENT MADE AFTER SUCH APPROVAL, REGARDLESS OF ITS VALIDITY OR CORRECTNESS.

I APPRECIATE THAT THIS AGREEMENT HAS AS ITS OBJECT A SIMPLIFICATION AND ACCELERATION OF THE AUDIT AND PAYMENT OF THE EXPENSES OF THE COST PLUS-A- FIXED-FEE CONTRACTOR, BUT I APPREHEND THAT THE RESULTS OF THE PROCEDURE HERE PROPOSED MAY WELL BE PREJUDICIAL TO THE INTERESTS OF THE UNITED STATES, IN THAT IT RENDERS AMBIGUOUS AND UNCERTAIN THE RESPONSIBILITY FOR OVERPAYMENTS OR ERRONEOUS PAYMENTS WHICH MAY BE MADE, AND ELIMINATES, TO A LARGE EXTENT, THE POSSIBILITY OF RECOVERY BY THE UNITED STATES OF ANY AMOUNT SO PAID FROM THOSE PARTIES WHO ORDINARILY WOULD BE CHARGED WITH THE RESPONSIBILITY FOR THE CORRECTNESS OF DISBURSEMENTS MADE BY THE GOVERNMENT.

THE CONTRACTOR'S INVOICES, RENTAL ROLLS, BILLS, AND PAY ROLLS ARE TO BE APPROVED FOR PAYMENT BY THE CONTRACTOR BY REPRESENTATIVES OF THE GOVERNMENT WHO, SO FAR AS I AM INFORMED, ARE NOT BONDED AND WHO PROBABLY COULD NOT BE HELD TO ACCOUNTABILITY FOR ERRORS IN THE ABSENCE OF NEGLIGENCE OR OTHER DERELICTION OF DUTY. SEE 15 COMP. GEN. 560; ID. 962; COMPARE 7 COMP. GEN. 264; ID. 797. DESPITE THIS, HOWEVER, ONCE AN INVOICE, PAY ROLL, OR OTHER EVIDENCE OF THE CONTRACTOR'S COST HAD BEEN APPROVED BY SUCH REPRESENTATIVE AND PAID BY THE CONTRACTOR, THE CERTIFYING OFFICER OF THE GOVERNMENT WHOSE DUTY IT IS TO CERTIFY TO THE FACTS GIVING RISE TO THE OBLIGATION TO PAY IS EFFECTIVELY FORECLOSED FROM INQUIRING INTO THE NATURE OF THE PAYMENT, VERIFYING ITS ACCURACY, OR TAKING OTHER STEPS TO DETERMINE ITS VALIDITY, INSOFAR AS THE CONTRACTOR IS CONCERNED, FOR THE LATTER MAY THEN RELY ON THE CONTRACTUAL AGREEMENT FOR REIMBURSEMENT TO IT FOR AMOUNTS PAID ON APPROVAL OF THE GOVERNMENT'S REPRESENTATIVES. IT IS EVIDENT, THEREFORE, THAT THE EFFECT OF THE AGREEMENT IS TO LIMIT THE FUNCTION OF THE CERTIFYING OFFICER TO A MERE SUPERFICIAL CHECK OF INVOICES, ETC., PREVIOUSLY VERIFIED BY WAR DEPARTMENT AUDITORS.

LIKEWISE, THE DISBURSING OFFICER NORMALLY IS PERSONALLY RESPONSIBLE, AT LEAST TO THE EXTENT OF DETERMINING THAT VOUCHERS REPRESENT LEGAL CLAIMS AGAINST THE GOVERNMENT AND FOR OTHER MATTERS APPARENT ON RECORD OR OF WHICH HE IS CHARGEABLE WITH NOTICE. NEVERTHELESS THE CONTRACT SUPPLEMENT PURPORTS TO REQUIRE THAT DISBURSING OFFICERS PAY VOUCHERS IN REIMBURSEMENT OF EXPENDITURES OF THE COST-PLUS-A-FIXED-FEE CONTRACTOR SO APPROVED IN ADVANCE EVEN THOUGH IT MAY BE PLAIN THAT THERE HAS BEEN AN IMPROPER APPROVAL OF AN ITEM, OR THAT ITS AMOUNT HAS BEEN MISCALCULATED.

IT IS THE EVIDENT INTENTION OF ARTICLE IV-B OF THE ORIGINAL CONTRACT HERE INVOLVED THAT THE CONTRACTOR SHALL PRESENT TO THE CONTRACTING OFFICER, FOR HIS CERTIFICATION AND VERIFICATION, SATISFACTORY EVIDENCE OF ITS EXPENDITURES, AND NOT THAT THE GOVERNMENT SHALL ASSUME THE BURDEN AND RISK OF PREPARING SUCH DATA FOR, AND PRIOR TO PAYMENT BY, THE CONTRACTOR. EFFECT, THE CONTRACTOR BECOMES A QUASI DISBURSING AGENT OF THE GOVERNMENT, PAYING BILLS AT THE DIRECTION OF THE GOVERNMENT'S REPRESENTATIVES, BUT WITHOUT THE ATTENDANT OBLIGATIONS AND SAFEGUARDS BY WHICH THE GOVERNMENT HAS PROTECTED ITSELF FROM ABUSE OF SUCH FUNCTIONS.

IF THE SUPPLEMENTAL AGREEMENT OF AUGUST 22, 1941, IS PUT INTO OPERATION, IT WOULD NOT APPEAR THAT THE CONTRACTOR, THE CONTRACTING OFFICER, OR THE DISBURSING OFFICER CAN BE HELD RESPONSIBLE FOR IMPROPER OR ERRONEOUS PAYMENTS, AND IT WOULD APPEAR THAT THE WAR DEPARTMENT'S REPRESENTATIVES WHO APPROVE THE ACCOUNTING DATA CAN BE SO HELD ONLY IN EXCEPTIONAL CASES. WHETHER RECOVERY MIGHT BE HAD FROM THE CONTRACTOR'S VENDOR, EMPLOYEE, LESSOR, OR OTHER RECIPIENT OF AN OVERPAYMENT FROM THE CONTRACTOR IS BY NO MEANS CERTAIN IN VIEW OF THEIR LACK OF PRIVITY OF CONTRACT WITH THE UNITED STATES, BUT, IN ANY EVENT, THE CIRCUITY AND MULTIPLICITY OF SUCH ACTIONS, WHEN CONSIDERED WITH THE PROBABLE DIFFICULTIES INVOLVED IN LOCATING AND COLLECTING FROM THE PARTIES CONCERNED, MAKE DUBIOUS THE PRACTICAL VALUE OF ANY SUCH REMEDY.

WHILE THE SECRETARY OF WAR HAS BEEN GIVEN BROAD GENERAL POWERS UNDER THE ACT OF JULY 2, 1940, 54 STAT. 712, CITED AS AUTHORITY FOR THE CONTRACT IN QUESTION, THE BROADEST INTERPRETATION OF SAID ACT DOES NOT APPEAR TO SANCTION, BY IMPLICATION OR OTHERWISE, AN AGREEMENT UNDERTAKING TO GIVE A CONCLUSIVE EFFECT TO AN ADMINISTRATIVE PREAUDIT OF THE CONTRACTOR'S OBLIGATIONS TO ITS EMPLOYEES, VENDORS, SUBCONTRACTORS, LESSORS, OR OTHER PERSONS ENGAGED BY IT IN THE PERFORMANCE OF THE ONTRACT; AND I AM CONSTRAINED TO HOLD THAT SUCH AN AGREEMENT IS BEYOND THE SCOPE OF AUTHORITY OF THE CONTRACTING OFFICER. CONSEQUENTLY, IN THE AUDIT OF VOUCHERS COVERING REIMBURSEMENT OF EXPENDITURES OF THE CONTRACTOR HERE INVOLVED, THIS OFFICE WILL PROCEED IN THE USUAL MANNER TO HOLD THE CERTIFYING OFFICER OR THE DISBURSING OFFICER, AS THE FACTS MAY REQUIRE, RESPONSIBLE FOR ERRONEOUS OR IMPROPER PAYMENTS UNDER THE CONTRACTS, NOTWITHSTANDING ANY APPROVAL OF THE SUPPORTING DATA BY GOVERNMENT REPRESENTATIVES PRIOR TO PAYMENT BY THE CONTRACTOR; AND, IN PROPER CASES, TO COLLECT SUCH ERRONEOUS OR IMPROPER PAYMENTS FROM ANY SUMS WHICH OTHERWISE MAY ACCRUE TO THE CONTRACTOR'S CREDIT.

LIKEWISE, IT MUST BE UNDERSTOOD THAT ANY UNDERTAKING ON THE PART OF THE CONTRACTING OFFICER THAT FINAL AUDIT OF THE ACCOUNTS RELATING TO THE CONTRACT FOR EACH CALENDAR YEAR SHALL BE MADE BY THE GOVERNMENT NOT LATER THAN 6 MONTHS AFTER THE END OF SUCH YEAR (PAR. 2, ART. VI-E, OF THE CONTRACT, AS STATED IN THE SUPPLEMENT OF AUGUST 22, 1941), CANNOT BE CONSTRUED OR INTERPRETED AS LIMITING IN ANY MANNER THE TIME WITHIN WHICH THIS OFFICE MAY EXERCISE ITS STATUTORY DUTY OF AUDITING THE ACCOUNTS OF THE DISBURSING OFFICER (31 U.S.C. 72), NOR ITS RIGHT TO REQUIRE FURTHER EVIDENCE IN SUPPORT OF VOUCHERS WHEN NECESSARY (31 U.S.C. 74), SINCE IT IS CLEARLY BEYOND THE POWER OF THE CONTRACTING OFFICER SO TO CIRCUMSCRIBE THE FUNCTIONS OF THIS OFFICE BY CONTRACTUAL AGREEMENT. COMPARE 20 COMP. GEN. 664, 671.