[Propriety of Depositing Liquidated Damages in Supervision and Administration Account]

The Army Corps of Engineers requested an advance decision regarding whether it could use the portion of delayed contract performance liquidated damages attributable to increased supervision and administration (S&A) expenses to reimburse its S&A revolving fund. GAO held that the Corps could credit the S&A liquidated damages to its S&A revolving fund, since recovery of S&A costs incurred after the contract's required completion date would not augment the revolving fund. Accordingly, the Corps could use the liquidated damages attributable to increased S&A expenses to reimburse its S&A revolving fund.