Improving Cash Management by Using 'Checks Paid' Method to Reimburse Army Ammunition Plant Contractors

A method of improving cash management in the Department of Defense (DOD) and reducing the cost of government borrowing is based on delaying disbursements from the Department of the Treasury to take greater advantage of the time value of money by converting from a checks-written basis to a checks-paid basis for reimbursing contractors. Interest expense to the government is thereby reduced. The technique can be advantageously applied in the Army's reimbursement of contractors who operate government-owned ammunition plants.