A-56180, JANUARY 11, 1935, 14 COMP. GEN. 535

A-56180, JANUARY 11, 1935, 14 COMP. GEN. 535

LOSS BY EXCHANGE - NAVAL ATTACHES' MAINTENANCE ALLOWANCE MAINTENANCE EXPENDITURES BY A NAVAL ATTACHE IN A PARTICULAR MONTH IN EXCESS OF THE AMOUNT ALLOWABLE IN THAT MONTH, AFTER MAKING PROPER ALLOWANCE FOR LOSS BY EXCHANGE, MAY NOT BE CARRIED FORWARD WITH A VIEW TO PAYMENT OUT OF A SUBSEQUENT MONTH'S ALLOWANCE. IN DETERMINING LOSS BY EXCHANGE IN THE MAINTENANCE ALLOWANCE OF A NAVAL ATTACHE, THE ALLOWANCE AND THE EXPENDITURE WILL BOTH BE CONVERTED AT THE COST RATE. IF THE LATTER DOES NOT EXCEED THE FORMER, NO LOSS HAS OCCURRED AND THE BALANCE FOR CARRYING FORWARD AS AVAILABLE FOR SUBSEQUENT EXPENDITURE IS THE DIFFERENCE BETWEEN THE TWO ITEMS RECONVERTED INTO DOLLARS AT COST RATE. IF THE EXPENDITURES EXCEED THE ALLOWANCE AT THE COST RATE, THE ALLOWANCE WILL BE CONVERTED AT THE BASIC RATE PRESCRIBED BY THE EXECUTIVE ORDER AND THE EXCESS EXPENDITURES, NOT EXCEEDING THE DIFFERENCE BETWEEN THE ALLOWANCE CONVERTED AT THE BASIC RATE AND AT THE COST RATE, MAY BE PAID AND CHARGED TO THE APPROPRIATION FOR LOSS BY EXCHANGE.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE NAVY, JANUARY 11, 1935:

THERE HAS BEEN RECEIVED YOUR LETTER OF DECEMBER 4, 1934, REQUESTING DECISION UPON THE PROPOSED METHOD OF COMPUTING LOSSES INCURRED IN MAINTENANCE ALLOWANCES CASES BY NAVAL ATTACHES AND ASSISTANT NAVAL ATTACHES AS OUTLINED IN LETTER DATED OCTOBER 17, 1934, FROM THE NAVAL ATTACHE AT LONDON, AS FOLLOWS:

5. ACCORDINGLY IT IS SUBMITTED THE FOLLOWING SHOULD APPLY IN CALCULATING AND ACCOUNTING FOR MAINTENANCE ALLOWANCES. AT THE END OF ANY MONTH---

(A) STATE THE UNEXPENDED CUMULATIVE ALLOTMENT IN LOCAL CURRENCY AT THE BASIC RATE.

(B) STATE THE CLAIM IN LOCAL CURRENCY, AS EXPENDED.

(C) IF (B) IS NOT GREATER THAN (A) IT IS PAYABLE.

(D) IF (B) IS LESS THAN (A), CARRY THE DIFFERENCE FORWARD TO THE ENSUING MONTH (WITHIN A FISCAL YEAR) AS UNEXPENDED CUMULATIVE ALLOTMENT.

(E) IF (B) IS GREATER THAN (A), CARRY THE DIFFERENCE FORWARD TO THE ENSUING MONTH (WITHIN THE FISCAL YEAR) AS UNREIMBURSED BALANCE OF CLAIM.

6. TO DETERMINE THE CHARGE TO BE MADE IN ANY MONTH AGAINST THE APPROPRIATION FOR EXCHANGE RELIEF:

(F) STATE THE MONTHLY ALLOTMENT IN LOCAL CURRENCY AT THE COST RATE.

(G) IF THE AMOUNT PAID ON THE CLAIM IS LESS THAN (F), THERE IS NO CHARGE THAT MONTH AGAINST THE APPROPRIATION FOR EXCHANGE RELIEF.

(H) IF THE AMOUNT PAID ON THE CLAIM IS GREATER THAN (F) THEN THE DIFFERENCE IS CHARGEABLE AGAINST THE APPROPRIATION FOR EXCHANGE RELIEF, CALCULATED AT THE COST RATE.

7. IT WILL BE NOTED THAT THE FOREGOING COMPLIES WITH ALL REQUIREMENTS OF LAW, EXECUTIVE ORDER, AND PREVIOUS INSTRUCTIONS:

(1) NO EXCHANGE RELIEF IS PAYABLE UNTIL ACTUAL LOSS HAS BEEN SUFFERED.

(2) THE CUMULATIVE FEATURE OF THE MAINTENANCE ALLOTMENT HAS BEEN PRESERVED.

8.IT IS PROPER TO POINT OUT THAT THE CUMULATIVE FEATURE OF THE MAINTENANCE ALLOTMENT HAS BEEN PRESERVED (1) BOTH IN CARRYING ALONG TO AN ENSUING MONTH (WITHIN THE FISCAL YEAR) ANY CUMULATIVE UNEXPENDED BALANCE, AND (2) ALSO SIMILARLY CARRYING ALONG TO AN ENSUING MONTH ANY UNREIMBURSED BALANCE OF MAINTENANCE CLAIM THERE MAY BE IN CASE THE UNEXPENDED CUMULATIVE ALLOTMENT AT THE END OF ANY MONTH IS WIPED OUT AND INSUFFICIENT.

9. THIS LATTER POINT HAS PROVED BY PAST EXPERIENCE TO BE ACADEMIC, AND HAS NOT BEEN CARRIED OUT. HOWEVER, IT MIGHT HAVE SUBSTANTIAL APPLICATION, AND FOR PROPER ACCOUNTING IT IS SUBMITTED THE INDICATED PROCEDURE SHOULD BE FOLLOWED.

THE PROPOSAL CONTAINED IN PARAGRAPHS 5 (E), 8 (2) AND 9 THAT WHEN THE EXPENDITURES IN A PARTICULAR MONTH EXCEED THE MAXIMUM AMOUNT ALLOWABLE IN THAT MONTH, THE EXCESS EXPENDITURE MAY BE CARRIED FORWARD WITH THE VIEW TO PAYING IT OUT OF A SUBSEQUENT MONTH'S ALLOWANCE WOULD ENTAIL THE INCURRING OF OBLIGATIONS IN EXCESS OF THE AVAILABLE ALLOWANCES. ANY EXCESS EXPENDITURES IN A PARTICULAR MONTH IN EXCESS OF THE ACCRUED ALLOWANCES THEN AVAILABLE MAY NOT BE CARRIED FORWARD FOR LIQUIDATION FROM THE ALLOWANCE FOR A SUCCEEDING MONTH.

PARAGRAPH 6 (H) DOES NOT INDICATE ANY LIMIT IN THE AMOUNT TO BE CHARGED AGAINST THE APPROPRIATION FOR LOSS BY EXCHANGE. OBVIOUSLY, THE CHARGE MUST BE WITHIN THE LIMITS OF THE ALLOWANCE IN DOLLARS CONVERTED AT THE BASIC RATE. IN THE SETTLEMENT OF THIS TYPE OF ACCOUNTS IN THIS OFFICE THE AMOUNT OF THE ALLOWANCE WILL BE CONVERTED AT THE COST RATE FOR EACH MONTH INVOLVED AND THE EXPENDITURES AT THE COST RATE WILL BE DEDUCTED THEREFROM. IF THE LATTER DOES NOT EXCEED THE FORMER, THERE IS NO LOSS BY REASON OF EXCHANGE AND THE BALANCE FOR CARRYING FORWARD TO BE AVAILABLE FOR SUBSEQUENT EXPENDITURE IS THE DIFFERENCE BETWEEN THE TWO ITEMS RECONVERTED INTO DOLLARS AT THE COST RATE. THE LOSS BY EXCHANGE IS FOR COMPUTATION AT THE COST RATE PREVAILING DURING EACH MONTH. IF THE EXPENDITURES EXCEED THE ALLOWANCE AT THE COST RATE, THE ALLOWANCE WILL BE CONVERTED AT THE BASIC RATE AND THE EXCESS EXPENDITURES, NOT EXCEEDING THE DIFFERENCE IN THE ALLOWANCE CONVERTED INTO FOREIGN CURRENCY AT THE BASIC RATE AND THE ALLOWANCE CONVERTED AT THE COST RATE WILL BE CHARGED TO THE APPROPRIATION FOR LOSS BY EXCHANGE. IF THIS DIFFERENCE BETWEEN BASIC AND COST RATES IS NOT ENTIRELY UTILIZED DURING A GIVEN MONTH, NO BALANCE OF ALLOWANCE IS AVAILABLE FOR CARRYING FORWARD TO THE NEXT MONTH AS THE LOSS FROM DEPRECIATION FOR THAT MONTH HAS BEEN ENTIRELY LIQUIDATED WITHIN THE LIMITS OF THE ALLOWANCE CONVERTED AT THE BASIC RATE TO THE EXTENT NECESSARY TO COVER SUCH LOSS.