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The Internal Revenue Service (IRS) requested a decision concerning whether: (1) it properly used imprest funds for recruitment advertising; (2) it properly contracted for advertising services; (3) it properly used imprest funds for advance payments for advertising services; and (4) the newspapers' receipts were adequate to support imprest fund payments. GAO determined that: (1) the use of imprest funds for recruitment advertising was proper since regulations permit agencies to use imprest funds for contract payments; (2) even though IRS used the wrong form, the procurement was proper since IRS correctly prepared and signed the form; (3) although IRS made advance payments for advertising services without authorization, no loss occurred to the government; and (4) the newspaper agent's initials on the receipt adequately reflected the intent of the newspaper to acknowledge receipt of payment. Accordingly, IRS may reimburse the imprest funds for the advertising costs.


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