Module 3_Fiscal Law Exam Q A (with complete solutions)

The established rule is that the expenditure of public funds is proper only when ________ by Congress, not that public funds may be expended unless prohibited by Congress. - ANSWER authorized In fiscal law, you can do ...

The established rule is that the expenditure of public funds is proper only when ________ by Congress, not that public funds may be expended unless prohibited by Congress. - ANSWER authorized In fiscal law, you can do only what the law authorized you to do. ______ of a law prohibiting you from doing something with your funding doesn't give you the authority to do it; it must be authorized by law in order for you to obligate funds - ANSWER Absence Are congressional committee reports (legislative history) lawful? - ANSWER No, Congressional committee reports known as legislative history are not law and generally not binding. Fiscal Law is based on the premise that appropriations are only available for obligation and expenditure when specifically _______ by the Congress, not that we can use appropriations unless specially prohibited by the Congress. - ANSWER approved What is fiscal law based upon? - ANSWER Fiscal Law is based upon the constitution, authorization acts, appropriation acts, general statues, Comptroller General Decision (Administration Law) and court decisions (case law). What does the appropriation acts identify? - ANSWER the purpose, time and amount of the appropriations Article 1, Section 7 gives Congress the power to do? - ANSWER Article 1, Section 7 empowers the Congress to pass bills for the raising of revenue, and delineates how bills will pass from the Congress to the President for signature or veto. Article 1, Section 8, Clause 1, empowers Congress to do? collect taxes. - ANSWER Article 1, Section 8, Clause 1, empowers Congress to collect taxes. Article 1, Section 9, Clause 7, requires appropriations to be law before before money is spent (True or False). - ANSWER True, Article 1, Section 9, Clause 7, requires appropriations in law before money may be spent from the Treasury. The term appropriation applies broadly to any law that permits a Government employee to spend money, not just to the regular appropriation bills. Law (authorization) is required before money can be ? - ANSWER spent Where can you go to get the the most authoritative source of information on the proper use of appropriated funds. - ANSWER The GAO "Redbook" is titled Principles of Federal Appropriation Law (www.gao.gov) What does the GAO "Redbook" contains? detailed guidance and numerous cases illustrating proper and improper use of funds. - ANSWER What does the GAO "Redbook" contains? detailed guidance and numerous cases illustrating proper and improper use of funds. The GAO "Redbook" contains two additional principles: Specific over general appropriations Do not do indirectly what you cannot do directly - ANSWER The GAO Redbook A specific appropriation________ a general appropriation. - ANSWER trumps Give example of "do not do indirectly what you cannot do directly"....You can not hire someone to do what you can do. - ANSWER For example, you can hire a contractor to fix a car if you can fix a car. Attorney advise, commander do what? - ANSWER decide What was the provision under Budget and Accounting Act of 1921 - ANSWER The President has to submit an annual budget Congress Created a budget office for the President (Bureau of the Budget then, changed to OMB in 1970). Established General Accounting Office (now Government Accountability Office). What was the prescribe under Impoundment Control Act of 1974? - ANSWER this law prescribes rules and procedures under which the President may withhold appropriated amounts from obligation (i.e., deferrals and rescissions). Balanced Budget and Emergency Deficit Control Act of 1985 was implemented to do ? - ANSWER designed to constrain spending and receipts legislation. Congressional Budget Act of 1974 did what? - ANSWER Establishes the House and Senate budget committees and the Congressional Budget Office (CBO). Governs the congressional budget process. Defines some of the key budget terms, that are used in the budget process. What OMB Circular provides instructions on budget execution, Provides instructions on monitoring Federal outlays, obtaining exemptions from GAO access to records , reporting requirements for unvouchered and expenditures, closing accounts, and monitoring Federal employment? - ANSWER OMB Circular A-11 Fiduciary responsibility conveys a_____ or ______. - ANSWER confidence or trust When a "Fund Certifying Official" certifies that the public's funds for which he has been entrusted, he/she is certifying that these funds are ________for use under the Purpose, Time and Amount and the restrictions placed on the use of these funds by the Congress. - ANSWER Legal An erroneous,_____________of fiduciary responsibility may lead to an Anti-deficiency Act Violation. - ANSWER willful or knowing violation Certifying officers will be held _________ for any erroneous payments, resulting from their miscertification, from the _______ the erroneous payment is made. - ANSWER personally liable, second There is no relief from an ADA violation. (True or False) - ANSWER True Who is responsible" certifies that the public's funds are legal for use under Purpose, Time and Amount restriction placed on the use of funds by the Congress? - ANSWER Fund Certifying Official What is pecuniary responsibility? - ANSWER the responsibility of physical control of the monies entrusted to the care of an accountable official of the government. Who has pecuniary responsibility for the monies entrusted to their care and will be held personally liable for any loss or theft of those funds? - ANSWER Disbursing Officer, cashiers, and collecting officers Can relief be granted for either a loss of cash or a miscertification, when certain conditions are met? - ANSWER Yes, However, an accountable official possessing personal responsibility, is presumed negligent when funds are missing or an erroneous payment is made, and is thus presumed responsible for the loss of monies, unless/until he/she proves his/her innocence. What is (31 USC 1301)? - ANSWER The purpose statuefor budgetary resources What is (31 USC 1502)? - ANSWER Time statue for budgetary resourcers What are the following USCs? 31 USC 1341—obligations in advance of appropriations 31 USC 1342—acceptance of voluntary service 31 USC 1517—obligaions in excess of - ANSWER The amount statue sfor budgetary resources What are budgetary resourcess that are available for new obligations for an indefinite period ...shall remain available until expended? - ANSWER No year funds what are budgetary resources that are available for incurring new obligations for one fiscal year or less? - ANSWER Annual Authority-- What are budgetary resources that are available for new obligations in excess of one fiscal year? - ANSWER Multiyear Authority The period of time during which budgetary resources may be used to incur new obligations (i.e goods or services) is ____ from the period of time during which the budgetary resources may be used to incur expenditures (i.e., pay bills). - ANSWER different What type of authority includes authority stated as "not to exceed" a specified amount. The law itself specifies an amount of budget authority available . Most DoD appropriations are of this type. - ANSWER definite authority. Lead time is based on the need to obligate. It depends on the object ...use your judgment. Who can provide advice on the lead time? - ANSWER The KO is the only that provide advice on the lead time. What statue leads to the greatest number of ADA violation? - ANSWER 31 USC 1301--Purpose statute What does the Purpose (31 USC 1301) states? - ANSWER "Appropriations shall be applied only to the objects for which the appropriations were made except as otherwise provided by law." Simply stated, what does the Purpose statue (31 USC 1301) implies? - ANSWER we can only use the appropriations, which the Congress provides, for the purpose or purposes authorized by the Congress. Be aware If the law does not specify an amount of budget authority available (e.g., if the amount is determined by specified variable factors). The amount is classified as? - ANSWER indefinite authority. If an agency has a specific appropriation for a particular item, and also has a general appropriation broad enough to cover the same item. what appropriation can he used? - ANSWER The agency does not have an option as to which to use. It must use the specific appropriation. Can you used a general appropriation as a back-up to a specific appropriation? - ANSWER No, if a specific appropriation exists for a particular item, then that appropriation must be used and it is improper to charge the more general appropriation (or any other appropriation) or to use it as a "back-up." . This clause define what doctrine presented by 6 Comp.Gen 619 (1927) 'It is a weIl-settled rule of statutory construction that where an appropriation is made for a particular object, by implication it confers authority to incur expenses that are necessary or proper or incidental to the proper execution of the object, unless they are prohibited by law, or unless it is manifestly evident from various precedent appropriation acts, that Congress has specifically legislated for certain expenses of the Government, creating the implication that such expenditures should not be incurred except by its express authority." - ANSWER Necessary expense doctrine When applying applying the necessary expense doctrine, an expenditure can be justified after meeting a three-part test: What are three part test? - ANSWER Logical relationship: The expenditure must bear a logical relationship to the appropriation sought to be charged. In other words, it must make a direct contribution to carrying out either a specific appropriation or an authorized agency function for which more general appropriations are available. BLUF: (use the right appropriation) Not Prohibited by Law: The expenditure must not be prohibited by law. (No law prohibiting expense or obligations) Not funded for Elsewhere: The expenditure must not be otherwise provided for, that is, it must not be an item that falls within the scope of some other appropriation or statutory funding scheme. The basic statute dealing for the time dimension is - ANSWER 31 USC 1502, "the balance of a fixed-term appropriation is available only for payment of expenses properly incurred during the period of availability or to complete contracts properly made within that period. 13 Op. Atty. Gen 288 (1870) rule that ? (hint: dealing with time) - ANSWER "Congress has the right to limit its appropriations to particular times as well as particular objects, 'and when it has clearly done so, its will expressed in the law should be implicitly followed." Simply stated what does 31 USC 1502 (Time) implies? - ANSWER This clearly states that payments may only be made for obligations that were properly made during the period of availability, but not completed until after the appropriation expired. A violation of the time code may also result in an ADA. Thus, a time-limited appropriation is available to incur an obligation only during the period for which it is made. However, it remains available beyond that period, within limits, to make adjustments to the amount of such obligations and to make payments to liquidate such obligations. What rule allow the spending agency a reasonable discretion in determining how to carry out the purpose of the appropriation? - ANSWER "necessary expense doctrine," Under the necessary and expense doctrine can a forest Service use its appropriation for "Forest Protection and Utilization" to buy plastic litterbags for use in a national forest. - ANSWER Yes, under the logical test of the necessary expense doctrine. the important thing to remember is the expense has to contribute to accomplishing the purposes of the appropriation the agency wishes to charge. Can expenditure for installation and maintenance of water pipelines be used to support a military base golf course? not permissible because such expenditure is specifically prohibited by - ANSWER No, because based on the second test under the necessary expense doctrine an expenditure must not be prohibited by law. 10 U.S.C. §2246, prohibit the use of appropriated funds to "equip, operate, or maintain" a golf course); As a general proposition, neither a necessary expense rationale nor the "necessary expense" language in an appropriation act can be used to overcome a statutory prohibition. Can the Navy use and appropriations made for the construction or procurement of vessels and aircraft to provide housing for civilian employees engaged in defense production activities? - ANSWER No, because funds for that purpose were otherwise available. The third test is that an expenditure cannot be authorized under a necessary expense theory if it is otherwise provided for under a more specific appropriation or statutory funding mechanism. The existence of a more specific source of funds, or a more specific statutory mechanism for getting them, is the governing factor and overrides the "necessary expense" considerations. True or False: All appropriations are presumed to be annual appropriations unless the appropriation act expressly provides otherwise. - ANSWER True Would a violation occur of 31 USC 1517 if a contract was entered into before the receipt of an apportionment or subapportionment of the appropriation? - ANSWER Yes, the Antideficiency Act,prohibits obligations or expenditures in advance of appropriations, 31 U.S.C. 1341(a), and apportionments, 31 U.S.C. 1517(a). By virtue of these law certainly no obligations may be incurred before the appropriation act is enacted and amounts apportioned to the agency, unless specifically authorized by law. What is the Bona Fide Needs Rule? - ANSWER Bona Fide Needs Rule is a test to determine when to obligate and for how much consumption or effort the obligation should cover. states that a fiscal year appropriation may be obligated only to meet a legitimate, or bona fide, need arising in, or in some cases arising prior to but continuing to exist in, the fiscal year for which the appropriation was made." - ANSWER Bona fide Need Rule The bona fide need occurs in the year the order is placed, not when the goods are services are ______? - ANSWER delivered. The Bona Fide Needs Rule does not prevent maintaining a legitimate inventory at reasonable and historical levels, the "need" being to maintain the inventory level so as to avoid disruption of operations. ...usually up to 90 days. - ANSWER ... The Bona Fide Needs Rule permits obligation in one fiscal year and delivery in a subsequent fiscal year if production lead-time of the material requires obligation in one fiscal year in order for the material to be available for installation in a later fiscal year. The time between ordering and delivery should not be excessive AND the procurement must not be for standard commercial items readily available when needed in the next fiscal year. Exception is shelf stock...you can store up to 90 days if you have the storage space. - ANSWER ... Ratification is when an unauthorized person makes an authorized purchased. Invalid contract in FY09, the contract is ratified in FY10m which funds do you used. You can use FY09 funds. 05 Sep 13 Joe bought items, the items was ratified in Oct1 2014, which funds to use? 2013 - ANSWER ... What are the obligation for contract termination, if the contractor default? - ANSWER Where it becomes necessary to terminate a contract because of the contractor's default, the funds obligated under the original contract are available, beyond their original period of obligational availability, for the purpose of engaging another contractor to complete the unfinished work. Implicit in the rule is the prem