2. This presentation varies slightly from the original. The slides have been updated to comply with internet publishing requirements. 1 Please Note

3. Appropriation Law Policy March 2011 2 VA Office of Financial Policy Presented by: Accounting and Payroll Policy Service

4. 3 To identify the Chief Financial Officers duties as promulgated by legislation, To assist in understanding the Office of Financial Policy (OFP) correlation to appropriation law, and To identify resources available when questions arise related to appropriation law. OFP Presentation Purpose

5. 4 The VA Chief Financial Officer (CFO) has authority to issue accounting policy based upon the following legislation. Title 31 U.S. C., Ch 9 Sec 901 (CFO Act) excerpt. http://uscode.house.gov/download/pls/31C9.txt http://uscode.house.gov/download/pls/31C9.txt Sec. 901. Establishment of agency Chief Financial Officers -Statute- (a) There shall be within each agency described in subsection (b) an agency Chief Financial Officer. Each agency Chief Financial Officer shall - (1) for those agencies described in subsection (b)(1) - (A) be appointed by the President, by and with the advice and consent of the Senate; or (B) be designated by the President, in consultation with the head of the agency, from among officials of the agency who are required by law to be so appointed. Sec. 902. Authority and functions of agency Chief Financial Officers -Statute- (a) An agency Chief Financial Officer shall – (1) report directly to the head of the agency regarding financial management matters; (2) oversee all financial management activities relating to the programs and operations of the agency; (3) develop and maintain an integrated agency accounting and financial management system, including financial reporting and internal controls; (4) make recommendations to the head of the agency regarding the selection of the Deputy Chief Financial Officer of the agency; (5) direct, manage, and provide policy guidance and oversight of agency financial management personnel, activities, and operations; (6) prepare and transmit, by not later than 60 days after the submission of the audit report required by section 3521(f) of this title, an annual report to the agency head and the Director of the Office of Management and Budget; (7) monitor the financial execution of the budget of the agency in relation to actual expenditures, and prepare and submit to the head of the agency timely performance reports; and (8) review, on a biennial basis, the fees, royalties, rents, and other charges imposed by the agency for services and things of value it provides, and make recommendations on revising those charges to reflect costs incurred by it in providing those services and things of value. CFO Authority

6. 5 Title 38 C.F.R. 2.6 (c) http://edocket.access.gpo.gov/cfr_2010/julqtr/38cfr2.6.htmhttp://edocket.access.gpo.gov/cfr_2010/julqtr/38cfr2.6.htm Chapter IDepartment of Veterans Affairs Part 2, Delegations of Authority, Sec. 2.6 Secretary's delegations of authority to certain officials (38 U.S.C. 512) excerpt. (c) Office of Management. (1) The Assistant Secretary for Management (Chief Financial Officer) is delegated authority to act on all matters assigned to his/her office, and to authorize supervisory personnel within his/her jurisdiction to perform such functions as may be assigned. Appropriate written notification will be furnished other Federal agencies concerning such authorizations. (2) The Assistant Secretary for Management (Chief Financial Officer) is delegated authority under 31 U.S.C. 1553(c)(1), to approve, in a fixed appropriation account to which the period of availability for obligation has expired, obligational increases related to contract changes when such transaction will cause cumulative obligational increase for contract changes during a fiscal year to exceed $4 million but not more than $25 million; for this responsibility the Assistant Secretary for Management (Chief Financial Officer) shall act as a member of the Office of the Secretary and shall report to and consult with the Secretary on these matters. (d) Assistant Secretary for Management (Chief Financial Officer); administration heads and staff office directors. The Assistant Secretary for Management (Chief Financial Officer) is delegated authority to take appropriate action (other than provided for in paragraphs (e)(3) and (e)(4) of this section) in connection with the collection of civil claims by VA for money or property, as authorized in Sec. 1.900, et seq. The Assistant Secretary for Management (Chief Financial Officer) may redelegate such authority as he/she deems appropriate to administration heads and staff office directors. CFO Authority (contd)

7. VA CFO Organization 6 Management/Financial Reports Service Director Office of Financial Policy Associate Deputy Assistant Secretary Office of the Deputy Assistant Secretary for Finance (DAS) Office of Financial Policy Deputy Director Acting Assistant Secretary for Management Secretary of VA Cost/Debt Management Service Director Accounting and Payroll Policy Service Director

8. 7 VA OFP provides VA-wide financial policy and guidance. OFP scope of responsibilities: Develops, coordinates, issues, evaluates, and reviews VA financial policies, systems, and procedures for compliance with all financial laws and regulations. Prepares VAs annual Consolidated Financial Statements and other comprehensive financial reports (e.g., Presidents Management Agenda scorecards and Office of Management and Budget/Treasury reports). Works with the Office of the Inspector Generals independent contract auditors on VAs annual Consolidated Financial Statements audit. Assists VAs Office of Budget in incorporating statements and audit results in the Annual Performance and Accountability Report (PAR). Develops policies and procedures for cash and debt management in accordance with the Debt Collection Improvement Act of 1996 and other Governmentwide programs and initiatives; such as, Electronic funds transfer (EFT), collection action, as well as compromise, waiver, suspension, and termination of collection action; Debt collection reporting (e.g., Treasury Report on Receivables); and Treasury Offset and Cross-Servicing Programs. Provides VA-wide customer support through financial integrity/guidance, analysis of expenditures and collection of funds, payroll, cash, and debt management oversight, asset property and inventory management oversight, and cost accounting. More information on OFP may be accessed through the VA internet Web site: http://www.va.gov/finance/policy http://www.va.gov/finance/policy OFP Responsibilities

9. 8 Congress - Appropriation Approval and funding for federal expenditures Limits government expenditures, to include amount, time and purpose OMB - Apportionment Distribution of appropriations Controls rate of distribution Agency - Allotment Administrative control and distribution of funds Limits rate and type of obligations, to include amount, time and purpose Appropriation Flow

10. 9 Fund Title No-Year Current Year Multi-Year 0110 Construction, Major Projects X X 0111 Construction, Minor Projects X X 0150 General Operating Expenses, Recovery Act X 0151 General Operating Expenses X X X 0167 Information Technology X X X 0170 Office of the Inspector General X X Fund Title No-Year Current Year Multi-Year 0152 Medical Support and Compliance (previously, Administration) X X X 0158 Medical Facilities, Recovery Act X 0160 Medical Services X X X 0161 Medical and Prosthetic Research X X 0162 Medical Facilities X X X 0165 DOD-VA Health Care Sharing Incentive Fund-Parent X 0168 Information Technology-Recovery Act X VA (Departmental) Veterans Health Administration Examples and Diversity of VA Funds

11. 10 Veterans Benefits Administration National Cemetery Administration Fund Title No-Year Current Year Multi-Year 0129 National Cemetery System X X X 0130 National Cemetery System, Recovery Act X 0183 Grants for the Construction of State Vet Cemeteries X X 5392 Lease of Land and Building, NCA Facilities Operation Fund X 8129 DVA Cemetery Gift Fund X Fund Title No-Year Current Year Multi-Year 0101 Compensation and Pensions Recovery Act X 0102 Compensation and Pensions X 0120 Veterans Insurance and Indemnities X 0128 G.T.H.L. for Homeless Veterans Program Account X 0137 Readjustment Benefits X 1114 Vocational Rehabilitation Loans Program X X 1119 Veterans Housing Benefit Program Fund, Program Account X X (contd)

12. 11 VHA received medical appropriations, to include Medical Services, Medical Support and Compliance (Medical Administration), and Medical Facilities. All other VA is funded on the current Continuing Resolution through April 8 th. OPM Furlough Web site: http://www.opm.gov/furlough/furlough.asp http://www.opm.gov/furlough/furlough.asp VAs Appropriations Status

13. 12 Questions should start with Administration and Other Staff Office points of contact and guidance VHA Outlook contact: VHA Accounting Policy (173A) VBA Outlook contact: VAVBAWAS/CO/FINREP NCA Finance Service: Ph# 540-658-7280 VA General Counsel: http://www.va.gov/OGC/http://www.va.gov/OGC/ OFP Outlook contact: OFP Accounting Policy Publications and Guidance Web sites: VA OFP Policy: http://www.va.gov/finance/policy/pubs/http://www.va.gov/finance/policy/pubs/ Site Search, right side of the page in the Quick Links section: search on Office of Finance rather than VA overall VA Publications: http://www.va.gov/vapubs/http://www.va.gov/vapubs/ VHA: http://www.va.gov/vhapublications/http://www.va.gov/vhapublications/ VBA: http://vbaw.vba.va.gov/http://vbaw.vba.va.gov/ VA General Counsel: http://www.va.gov/OGC/http://www.va.gov/OGC/ VA OIG: http://www.va.gov/oig/publications/http://www.va.gov/oig/publications/ GAO Principles of Federal Appropriations Law (Redbook): http://www.gao.gov/legal/redbook.html http://www.gao.gov/legal/redbook.html Research Resources for Appropriation Questions

14. 13 Volume I General Accounting Chapters Ch.TitleCh.Title 1Introduction to VAs Accounting Policies 4b. Account Classification Codes 1a. Process to Update/Develop Financial Policy and Procedures 5. Management Accountability and Responsibility for Internal Controls 1b.Quality Financial Information 6. Reconciliations 2Standard General Ledger 7. Fiscal Year-End Budgetary Reports 3.Maintenance of Standard General Ledger 8 Period-Ending Procedures 3a.PAID Accounting Operations 9 Interstation Transactions 4.Financial Management System9a. Expenditure Transfers, Adjustments to Expenditures, and Reimbursable Agreements 4a.Revenue Source Codes10. Bartering OFP Policy Related to Appropriation Law

15. 14 Volume II Appropriations, Funds & Related Information Chapters Ch 2 VAs Budget Cycle and Fund Symbols Appropriation flow down to VA Types and availability of funds Current appropriations by VA (Departmental) and Administration Ch.TitleCh.Title 1General Information2h.Life Insurance Program 2VAs Budget Cycle and Fund Symbols2i.Major Construction Working Reserve Accounts 2a.Supply Fund4. Awards, Ceremonies, Food or Refreshments, Gifts or Mementos 2b.Franchise Fund5.Policy on Obligating Printing Costs 2c.Clearing (Suspense) and Deposit Funds6.Miscellaneous Obligations 2d.General Fund Receipt Account7d. Guidelines to Avoid Augmenting an Appropriation 2e.Parking Garage Revenue7e.Recycling Revenue 2g.Enhanced-Use Funds7f.Refunds and Rebates (contd)

16. 15 Kitchen Appliances and Facilities Vol V Ch 10b, Use of VA Appropriated Funds to Purchase Kitchen Appliances Incentive Awards, Gifts, Food or Refreshments Vol II Ch 4, Awards Ceremonies, Food or Refreshments, Gifts or Mementos Prior Year Recoveries – Unexpired Funds OMB A-11 requires reapportionment of funds in 2 nd and subsequent years for multi and no-year before additional obligations or upward adjustments are approved. Applies to unexpired funds, not annual funds. Discussed in Volume II, Chapter 2, VAs Budget Cycle and Funds Symbols. FMS does not capture this information and VA is not currently reporting. Funds are immediately available and obligated. OFP and other offices working with Treasury and OMB on solutions. FAQs: Appropriation Law Related

17. 16 Receive funding Obligation recorded 1 st Yr of 2–Yr Funds Request apportionment for funds available from 1 st year Submit request for estimate of anticipated recoveries (de-obligations or downward adjustments De-Obligation or downward adjustment recognized Realized recovery and Funds become available for additional obligations 2 nd Yr of 2-Yr Funds Prior Year Recovery Process

18. 17 Example of a PYR in a multi-year fund: Medical Care Budget Years 10/11): In the 1 st year of 2-year fund, a facility enters into an obligation. In the 2 nd year (funds are consider unexpired, the obligation is decreased or de-obligated (downward adjustment.) In FMS, the de-obligated amount is posted back to the general ledger accounts and budgetary tables. In the 2 nd year, funds are available for additional obligations. In FMS and IFCAP reports and tables, funds are available for obligation. Stations use the funds for upward obligation adjustments and new obligations Proper authority for the re-apportionment of estimated recoveries has not been requested or received. The scenario is in violation of A-11 reporting requirements. VAs Current Process

19. 18 Questions