A-59705, MAY 20, 1937, 16 COMP. GEN. 1016

A-59705, MAY 20, 1937, 16 COMP. GEN. 1016

EXCHANGE - LOSS BY - OFFICERS AND EMPLOYEES IN FOREIGN COUNTRIES - SALARIES AND PER DIEM ALLOWANCE THE DECISION IN 16 COMP. GEN. 509, AS TO EXCHANGE LOSSES OF OFFICERS AND EMPLOYEES TRAVELING, BUT NOT STATIONED, IN FOREIGN COUNTRIES, DID NOT HOLD THAT FROM AMOUNTS PROPERLY IDENTIFIED AS SALARY CONVERSIONS THERE MUST BE DEDUCTED THE PER DIEM IN LIEU OF SUBSISTENCE AND EXCHANGE LOSS THEREON, WHICH WOULD HAVE PRECLUDED ANY EXCHANGE LOSS ON SALARY IF IT DID NOT EXCEED THE PER DIEM ALLOWANCE OF THE EMPLOYEE, BUT HELD THAT IN ORDER TO DETERMINE WHAT PORTION OF THE TOTAL AMOUNT CONVERTED CONSTITUTES SALARY FOR SALARY EXCHANGE LOSS PURPOSES, THERE MUST BE DEDUCTED FROM THE TOTAL CONVERTED THE PER DIEM ALLOWANCE AND EXCHANGE LOSS THEREON.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF STATE, MAY 20, 1937:

YOUR LETTER OF MAY 6, 1937, REQUESTS DECISION UPON THE QUESTION PRESENTED IN THE DISPATCH OF APRIL 6, 1937, FROM THE DISTRICT ACCOUNTING AND DISBURSING OFFICE AT PARIS, FRANCE, AS FOLLOWS:

I HAVE THE HONOR TO REQUEST THE GOOD OFFICES OF THE DEPARTMENT IN SECURING A CLARIFICATION FROM THE COMPTROLLER GENERAL OF A RECENT DECISION.

IN THE DECISION DATED NOVEMBER 20, 1936, C.G. XVI, P. 510, THE LAST PARAGRAPH READS:

"IN CONNECTION WITH THE COMPUTATION OF LOSS UPON SALARY PAYMENTS CONVERTED FOR EXPENDITURE ABROAD, THERE SHOULD NOT BE OVERLOOKED THE REQUIREMENT THAT THERE MUST FIRST BE DEDUCTED FROM THE AMOUNTS CONVERTED FOR EXPENDITURE THE TOTAL OF ANY PER DIEM IN LIEU OF SUBSISTENCE AND EXCHANGE LOSS THEREON, THE LOSS UPON SALARY PAYMENTS BEING COMPUTED ONLY UPON THE EXCESS CONVERSION. A-74738, OCTOBER 1, 1936.'

THE SYLLABUS VARIES THE WORDING SOMEWHAT, IN SAYING:

"EXCHANGE LOSSES ON SALARY PAYMENTS CONVERTED FOR EXPENDITURE ABROAD BY OFFICERS AND EMPLOYEES TRAVELING BUT NOT STATIONED IN FOREIGN COUNTRIES ARE FOR COMPUTATION ON THE BASIC RATE APPLICABLE TO THE COUNTRY IN WHICH THE CONVERSION IS ACTUALLY MADE AND BY DEDUCTING FROM AMOUNTS SO CONVERTED THE TOTAL OF ANY PER DIEM IN LIEU OF SUBSISTENCE AND EXCHANGE LOSS THEREON, SALARY EXCHANGE LOSSES BEING COMPUTED ONLY UPON THE EXCESS CONVERSION.'

IT IS THE INTERPRETATION OF SOME DISBURSING OFFICES THAT THE WORDS "THE AMOUNTS CONVERTED" IN THE RULING AND IN THE SYLLABUS RELATE EXCLUSIVELY TO CONVERSIONS OF SALARY, AND EXCLUDE OTHER AMOUNTS CONVERTED, AND REQUIRE THAT CURRENCY LOSS BE PAID ONLY ON THAT PART OF THE SALARY CONVERTED ABROAD WHICH IS IN EXCESS OF THE AMOUNT OF THE PER DIEM AND THE LOSS THEREON.

FOR EXAMPLE, A PERSON RECEIVING A SALARY OF $400.00 PER MONTH WHO CONVERTS THIS AND HIS PER DIEM OF $180.00 PER MONTH AND EXCHANGE LOSS ON PER DIEM OF $50.00, CAN ONLY RECEIVE EXCHANGE LOSS ON $170.00 OF HIS SALARY:

CHART SALARY ------------------------------------------------------ $400.00 LESS PER DIEM ------------------------------------ $180.00 LESS EXCHANGE LOSS ON PER DIEM --------------------- 50.00

------- 230.00

170.00$170.00, AMOUNT OF SALARY ON WHICH EXCHANGE LOSS IS PAYABLE.

THIS INTERPRETATION PRECLUDES THE PAYMENT OF ANY LOSS ON SALARY IN THE CASES OF LOW SALARIED EMPLOYEES WHOSE SALARY IS LESS THAN THEIR PER DIEM, AND IN THE CASE OF THOSE OF LARGER SALARIES FORBIDS THE PAYING OF LOSS ON THE EQUIVALENT OF THEIR PER DIEM AND EXCHANGE LOSS THEREON, IN THE CASE OF THOSE CONVERTING ALL OF THEIR SALARY AND PER DIEM ABROAD.

IN VIEW OF THESE CONSIDERATIONS, THAT INTERPRETATION SEEMS CONTRARY TO THE IMPLICATIONS OF THE EXECUTIVE ORDER OF SEPTEMBER 18, 1934, NO. 6657.

IT HAS BEEN THE INTERPRETATION OF THIS OFFICE, HOWEVER, THAT THE PHRASE "AMOUNTS CONVERTED" INCLUDES NOT ONLY SALARY, BUT PER DIEM, CURRENCY LOSS, AND PERSONAL CHECKS, AND MEANS THE TOTAL OF ALL AMOUNTS CONVERTED FOR EXPENDITURE ABROAD, AND IT IS FROM THIS TOTAL THAT THE PER DIEM AND LOSS THEREON IS TO BE DEDUCTED.

FOR EXAMPLE, IN THE CASE CITED ABOVE:

CHART

CHECKS CONVERTED ABROAD:

1. SALARY ------------------------------------ $400.00

2. PER DIEM ---------------------------------- 180.00

3. LOSS ON PER DIEM -------------------------- 50.00

TOTAL CONVERTED ------------------------ 630.00

DEDUCT:

1. PER DIEM ---------------------- $180.00

2. LOSS ON PER DIEM -------------- 50.00

------- 230.00

400.00

$400.00, AMOUNT ON WHICH EXCHANGE LOSS IS PAYABLE.

THIS DIFFERENCE OF INTERPRETATION IS CAUSING SOME EMBARRASSMENT, AND A CLARIFICATION IS GREATLY DESIRED.

IN THE CASE OF EMPLOYEES TRAVELING, BUT NOT STATIONED, IN A FOREIGN COUNTRY, THE EXECUTIVE ORDERS AUTHORIZE EXCHANGE LOSSES ONLY UPON THAT PORTION OF THE SALARY SHOWN TO HAVE BEEN CONVERTED FOR EXPENDITURE ABROAD. ACCORDINGLY, IN ORDER TO DETERMINE WHAT PORTION OF THE TOTAL AMOUNTS SHOWN TO HAVE BEEN CONVERTED CONSTITUTES SALARY THERE MUST BE DEDUCTED FROM THE TOTAL CONVERSIONS, THE PER DIEM IN LIEU OF SUBSISTENCE AND EXCHANGE LOSSES UPON THE PER DIEM; AND ONLY THE AMOUNTS CONVERTED IN EXCESS OF THE PER DIEM AND EXCHANGE LOSSES THEREON CAN BE CONSIDERED AS THE CONVERSION OF SALARY. IF THE AGGREGATE AMOUNTS SHOWN TO HAVE BEEN CONVERTED EQUAL OR EXCEED THE AGGREGATE OF THE SALARY PLUS PER DIEM AND EXCHANGE LOSSES UPON THE PER DIEM, THE EXCHANGE LOSS WOULD BE PAYABLE UPON THE ENTIRE AMOUNT OF THE SALARY IN ADDITION TO THE EXCHANGE LOSSES UPON THE PER DIEM. THE DECISION IN 16 COMP. GEN. 509, WAS NOT INTENDED TO AND DID NOT HOLD THAT FROM AMOUNTS PROPERLY IDENTIFIED AS SALARY CONVERSIONS THERE MUST BE DEDUCTED THE PER DIEM AND EXCHANGE LOSS THEREON, WHICH WOULD HAVE PRECLUDED ANY EXCHANGE LOSS ON SALARY IF IT DID NOT EXCEED THE PER DIEM ALLOWANCE OF THE EMPLOYEE.