A-59705, NOVEMBER 20, 1936, 16 COMP. GEN. 509

A-59705, NOVEMBER 20, 1936, 16 COMP. GEN. 509

EXCHANGE - LOSS BY - OFFICERS AND EMPLOYEES IN FOREIGN COUNTRIES 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.

ACTING COMPTROLLER GENERAL ELLIOTT TO THE SECRETARY OF STATE, NOVEMBER 20, 1936:

REFERENCE IS HAD TO YOUR LETTER OF NOVEMBER 3, 1936, AS FOLLOWS:

REFERENCE IS MADE TO THIS DEPARTMENT'S LETTER OF MAY 20, 1935, IN REGARD TO THE PAYMENT OF EXCHANGE LOSSES TO OFFICERS AND EMPLOYEES WHILE TRAVELING UNDER GENERAL ORDERS AND NOT ASSIGNED TO A PARTICULAR COUNTRY, AND TO A DECISION OF THE THEN COMPTROLLER GENERAL, A-59705 OF MAY 28, 1935, BASED ON THAT INQUIRY.

THE QUESTION PRESENTED BY THE DEPARTMENT WAS, IN SUBSTANCE, AS FOLLOWS:

"IN VIEW OF THE UNCERTAINTY WHICH EXISTS AS TO THE BASIC RATE TO BE USED IN COMPUTING CURRENCY APPRECIATION LOSSES, THAT IS, THE ONE ESTABLISHED FOR THE COUNTRY IN WHICH THE CHECK OR DRAFT IS CASHED OR THE ONE ESTABLISHED FOR THE COUNTRY OR COUNTRIES IN WHICH THE OFFICER WAS AT THE TIME THE SALARY AND ALLOWANCES ACCRUED, I WOULD APPRECIATE AN EARLY EXPRESSION OF YOUR VIEWS IN ORDER THAT THE ASSISTANT DISTRICT ACCOUNTING AND DISBURSING OFFICER MAY BE PROPERLY INSTRUCTED BY TELEGRAPH.'

THE DECISION UNDER REFERENCE HOLDS, IN CONNECTION WITH THE PAYMENT OF EXCHANGE LOSSES IN THE CIRCUMSTANCES CITED, AS FOLLOWS:

"REIMBURSEMENT OF SALARY LOSSES, THEREFORE, INCURRED BY AN OFFICER OR EMPLOYEE TRAVELING, BUT NOT STATIONED IN A FOREIGN COUNTRY IS TO BE CONFINED TO AMOUNTS ACTUALLY CONVERTED FOR EXPENDITURE AND MUST THEREFORE BE BASED UPON EVIDENCE OF ACTUAL CONVERSION AND AT THE RATE OF EXCHANGE AT WHICH THE CONVERSION WAS EFFECTED.'

THE DISTRICT ACCOUNTING AND DISBURSING OFFICER AT PARIS NOW REQUESTS A CLARIFICATION OF THAT DECISION AND STATES:

"CONVERSIONS OF A CHECK AT THE BANK ARE NOT MADE AT BASIC RATES, AND TO BE ON THE SAFE SIDE THIS OFFICE HAS IN THE PAST PRORATED SALARIES AS WELL AS PER DIEMS. AS THE FRANC WAS ONE OF THE MOST FAVORABLE RATES, THE PRORATING OF CHECKS CASHED IN PARIS WAS PROFITABLE TO THE GOVERNMENT. NOW, WITH THE DEVALUED RATE, THIS WILL NO LONGER BE SO GENERALLY THE CASE, AND IT IS RESPECTFULLY REQUESTED THAT THE COMPTROLLER GENERAL BE SOLICITED TO CLARIFY HIS DECISION AND GIVE A RULING AS TO THE BASIC RATE TO BE USED FOR THE SALARIES OF THOSE WITHOUT A DEFINITE POST OF ASSIGNMENT ABROAD.'

IT IS THE DEPARTMENT'S UNDERSTANDING OF THE DECISION QUOTED ABOVE THAT, IN THE CIRCUMSTANCES CITED, THE BASIC RATE TO BE USED IN COMPUTING EXCHANGE LOSSES IS THAT BASIC RATE WHICH IS APPLICABLE TO THE COUNTRY WHEREIN THE CONVERSION OF THE SALARY CHECK IS EFFECTED; AND THAT IT IS NOT NECESSARY TO PRORATE THE SALARIES AS SUGGESTED BY THE DISTRICT ACCOUNTING AND DISBURSING OFFICER. FOR EXAMPLE, AN EMPLOYEE TRAVELING UNDER GENERAL ORDERS AND NOT ASSIGNED TO A PARTICULAR POST SPENDS THE FIRST TWENTY-FIVE DAYS OF THE MONTH OF SEPTEMBER IN FRANCE AND THE LAST FIVE DAYS IN ENGLAND. IN SUCH CASE, THE SALARY WOULD HAVE ACCRUED TO THE EMPLOYEE ON SEPTEMBER 30 ON WHICH DATE THE CONVERSION OF HIS SALARY CHECK IS EFFECTED IN ENGLAND. IF THE DEPARTMENT'S UNDERSTANDING IS CORRECT, THE BASIC RATE APPLICABLE TO THAT COUNTRY, AND NOT TO FRANCE, IS THE ONE TO BE USED IN COMPUTING THE EXCHANGE LOSS.

I SHALL APPRECIATE YOUR ADVICE WHETHER THIS UNDERSTANDING IS IN ACCORDANCE WITH THE DECISION REFERRED TO IN ORDER THAT SPECIFIC INSTRUCTIONS MAY BE ISSUED TO THE DISTRICT ACCOUNTING AND DISBURSING OFFICER AT PARIS.

THE COMPUTATION OF EXCHANGE LOSSES UPON CONVERSION OF SALARY PAYMENTS FOR EXPENDITURE ABROAD IN THE CASE OF OFFICERS AND EMPLOYEES TRAVELING BUT NOT STATIONED IN FOREIGN COUNTRIES SHOULD BE ON THE BASIC RATE APPLICABLE TO THE COUNTRY IN WHICH THE CONVERSION IS ACTUALLY MADE.

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.