be presented. Each method of ordering transportation and transportation services may require a different kind of prepayment audit. Your agency's prepayment audit program must consider all of the methods that you use to order and pay for transportation services. With each method of ordering transportation services, your agency should ensure that each TSP bill or employee travel voucher contains enough information for the prepayment audit to determine which contract or rate tender is used and that the type and quantity of any additional services are clearly delineated. a (b) For transportation payments made through cost reimbursable contracts, the agency must include statement in the contract that the contractor shall submit to the address identified for prepayment audit, transportation documents which show that the United States will assume freight charges that were paid by the contractor. (c) Cost reimbursable contractors shall only submit for audit bills of lading with freight shipment charges exceeding $100.00. Bills under $100.00 shall be retained on-site by the contractor and made available for on-site audits. [69 FR 57619, Sept. 24, 2004] §102-118.280 What advantages does the prepayment audit offer my agency? Prepayment auditing will allow your agency to detect and eliminate billing errors before payment and will eliminate the time and cost of recovering agency overpayments. § 102-118.285 What options for performing a prepayment audit does my agency have? Your agency may perform a prepayment audit by: (a) Creating an internal prepayment audit program; (b) Contracting directly with a prepayment audit service provider; or (c) Using the services of a prepayment audit contractor under GSA's multiple award schedule covering audit and financial management services. NOTE TO $102-118.285: Either of the choices in paragraph (a), (b) or (c) of this section might include contracts with charge card companies that provide prepayment audit services. § 102-118.290 Must every electronic and paper transportation bill undergo a prepayment audit? Yes, all transportation bills and payments must undergo a prepayment audit unless your agency's prepayment audit program uses a statistical sampling technique of the bills or the Administrator of General Services grants a specific waiver from the prepayment audit requirement. If your agency chooses to use statistical sampling, all bills must be at or below the Comptroller General specified limit of $2,500.00 (31 U.S.C. 3521(b) and General Accounting Office Policy and Procedures Manual Chapter 7, obtainable from: U.S. General Accounting Office Gaithersburg, MD 20884-6015 § 102-118.295 What are the limited exceptions to every bill undergoing a prepayment audit? The limited exceptions to bills undergoing a prepayment audit are those bills subject to a waiver from GSA (which may include bills determined to be below your agency's threshold). The waiver to prepayment audit requirements may be for bills, mode or modes of transportation or for an agency or subagency. § 102-118.300 How does my agency fund its prepayment audit program? Your agency must pay for the prepayment audit from those funds appropriated for transportation services. § 102-118.305 Must my agency notify the TSP of any adjustment to the TSP's bill? Yes, your agency must notify the TSP of any adjustment to the TSP's bill either electronically or in writing within 7 days of receipt of the bill. This notice must refer to the TSP's bill number, agency name, taxpayer identification number, standard carrier alpha code, document reference number, amount billed, amount paid, payment voucher number, complete tender or 208-174 D-12 tariff authority, including item or section number. § 102-118.310 Must my agency prepayment audit program establish_appeal procedures whereby a TSP may appeal any reduction in the amount billed? Yes, your agency must establish an appeal process that directs TSP appeals to an agency official who is able to provide adequate consideration and review of the circumstances of the claim. Your agency must complete the review of the appeal within 30 days. § 102-118.315 What must my agency do if the TSP disputes the findings and my agency cannot resolve the dispute? (a) If your agency is unable to resolve the disputed amount with the TSP, your agency should forward all relevant documents including a complete billing history, and the appropriation or fund charged, to: General Services Administration (b) The GSA Audit Division will review the appeal of an agency's final, full or partial denial of a claim and issue a decision. A TSP must submit claims within 3 years under the guidelines established in § 102-118.460. [65 FR 24569, Apr. 26, 2000, as amended at 69 FR 57620, Sept. 24, 2004] § 102-118.320 What information must be on transportation bills that have completed my agency's prepayment audit? (a) The following information must be annotated on all transportation bills that have completed a prepayment audit: (1) The date received from a TSP; (2) A TSP's bill number; (3) Your agency name; (4) A Document Reference Number (DRN); (5) The amount billed; (6) The amount paid; (7) The payment voucher number; (8) Complete tender or tariff authority, including item or section number; (9) The TSP's taxpayer identification number (TIN); (10) The TSP's standard carrier alpha code (SCAC); (11) The auditor's authorization code or initials; and (12) A copy of any statement of difference sent to the TSP. (b) Your agency can find added guidance in the "U.S. Government Freight Transportation-Handbook," obtain able from: General Services Administration [65 FR 24569, Apr. 26, 2000, as amended at 69 FR 57620, Sept. 24, 2004] MAINTAINING AN APPROVED PROGRAM § 102-118.325 Must I get approval for my agency's prepayment audit program? Yes, your agency must get approval for your prepayment audit program. The highest level budget or financial official of each agency, such as the Chief Financial Officer, initially approves your agency's prepayment audit program. After internal agency approval, your agency submits the plan in writing to the GSA Audit Division for final approval. § 102-118.330 What are the elements of an acceptable prepayment audit program? An acceptable prepayment audit program must: (a) Verify all transportation bills against filed rates and charges before payment; (b) Comply with the Prompt Payment Act (31 U.S.C. 3901, et seq.); (c) Allow for your agency to establish minimum dollar thresholds for transportation bills subject to audit; (d) Require your agency's paying office to offset, if directed by GSA's Audit Division, debts from amounts owed to the TSP within the 3 years as per 31 U.S.C. 3726(b); (e) Be approved by the GSA Audit Division. After the initial approval, the agency may be subject to periodic program review and reapproval; (f) Complete accurate audits of transportation bills and notify the TSP of any adjustment within 7 calendar days of receipt; (g) Create accurate notices to the TSPS that describe in detail the reasons for any full or partial rejection of the stated charges on the invoice. An accurate notice must include the TSP's invoice number, the billed amount, TIN, standard carrier alpha code, the charges calculated by the agency, and the specific reasons including applicable rate authority for the rejection; (h) Forward documentation monthly to the GSA Audit Division, which will store paid transportation bills under the General Records Schedule 9, Travel and Transportation (36 CFR Chapter XII, 1228.22) which requires keeping records for 3 years. GSA will arrange for storage of any document requiring special handling (e.g., bankruptcy, court case, etc.). These bills will be retained pursuant to 44 U.S.C. 3309 until claims have been settled; (i) Establish procedures in which transportation bills not subject to prepayment audit (i.e., bills for unused tickets and charge card billings) are handled separately and forwarded to the GSA Audit Division; and (j) Implement a unique agency numbering system to handle commercial paper and practices (see § 102-118.55). [65 FR 24569, Apr. 26, 2000, as amended at 69 FR 57619, Sept. 24, 2004] §102-118.335 What does the GSA Audit Division consider when verifying an agency prepayment audit program? The GSA Audit Division bases verification of agency prepayment audit programs on objective cost-savings, paperwork reductions, current audit standards and other positive improvements, as well as adherence to the guidelines listed in this part. §102-118.340 How does my agency contact the GSA Audit Division? Your agency may contact the GSA Audit Division by writing to: General Services Administration Federal Supply Service Audit Division (FBA) 1800 F Street, NW. Washington, DC 20405 www.gsa.gov/transaudits [65 FR 24569, Apr. 26, 2000, as amended at 69 FR 57620, Sept. 24, 2004] § 102-118.345 If my agency chooses to change an approved prepayment audit program, does the program need to be reapproved? Yes, you must receive approval of any changes in your agency's prepayment audit program from the GSA Audit Division. LIABILITY FOR CERTIFYING AND DISBURSING OFFICERS § 102-118.350 Does establishing a prepayment audit system or program change the responsibilities of the certifying officers? Yes, in a prepayment audit environment, an official certifying a transportation voucher is held liable for verifying transportation rates, freight classifications, and other information provided on a transportation billing instrument or transportation request undergoing a prepayment audit (31 U.S.C. 3528). § 102-118.355 Does a prepayment audit waiver change any liabilities of the certifying officer? Yes, a certifying official is not personally liable for verifying transportation rates, freight classifications, or other information provided on a GBL or passenger transportation request when the Administrator of General Services or designee waives the prepayment audit requirement and your agency uses postpayment audits. § 102-118.360 What relief from liability is available for the certifying_official under a postpayment audit? The agency counsel relieves a certifying official from liability for overpayments in cases where postpayment is the approved method of auditing and: (a) The overpayment occurred solely because the administrative review before payment did not verify transportation rates; and (b) The overpayment was the result of using improper transportation rates or freight classifications or the failure to deduct the correct amount under a land grant law or agreement. § 102-118.390 On what basis does GSA grant a waiver to the prepayment audit requirement? GSA issues waivers to the prepayment audit requirement based on: (a) Cost-effectiveness; (b) Government efficiency; (c) Public interest; or (d) Other factors the Administrator of General Services considers appropriate. § 102-118.395 How long will GSA take to respond to a waiver request? GSA will respond to a written waiver request within 30 days from the receipt of the request. § 102-118.400 Must my agency renew a waiver of the prepayment audit requirements? Yes, your agency waiver to the prepayment audit requirement will not exceed 2 years. Your agency must reapply to ensure the circumstances at the time of approval still apply. § 102-118.405 Are my agency's prepay. ment audited transportation bills subject to periodic postpayment audit oversight from the GSA Audit Division? Yes, two years or more after starting prepayment audits, the GSA Audit Division (depending on its evaluation of the results) may subject your agency's prepayment audited transportation bills to periodic postpayment audit oversight rather than blanket postpayment audits. The GSA Audit Division will then prepare a report analyzing the success of your agency's prepayment audit program. This report will be on file at GSA and available for your review. SUSPENSION OF AGENCY PREPAYMENT AUDIT PROGRAMS § 102-118.410 Can GSA suspend my agency's prepayment audit program? (a) Yes, the Director of the GSA Audit Division may suspend your agency's prepayment audit program based on his or her determination of a systematic or frequent failure of the program to: (1) Conduct an accurate prepayment audit of your agency's transportation bills; (2) Abide by the terms of the Prompt Payment Act; (3) Adjudicate TSP claims disputing prepayment audit positions of the agency regularly within 30 days of receipt; (4) Follow Comptroller General decisions, GSA Board of Contract Appeals decisions, the Federal Management Regulation and GSA instructions or precedents about substantive and procedure matters; and/or (5) Provide information and data or to cooperate with on-site inspections necessary to conduct a quality assurance review. (b) A systematic or a multitude of individual failures will result in suspension. A suspension of an agency's prepayment audit program may be in whole or in part for failure to conduct proper prepayment audits. Subpart E-Postpayment § 102-118.415 Will the widespread mandatory use of prepayment audits eliminate postpayment audits? No, the mandatory use of prepayment audits will not eliminate postpayment audits because: (a) Postpayment audits will continue for those areas which do not lend themselves to the prepayment audit; and (b) The GSA Audit Division will continue to review and survey the progress of the prepayment audit by performing a postpayment audit on the bills. The GSA Audit Division has a Congressionally mandated responsibility under 31 U.S.C. 3726 to perform oversight on transportation bill payments. During the early startup period for prepayment audits, transportation bills are subject to a possible postpayment audit to discover the effectiveness of the prepayment audit process. audit oversight requirements of this subpart on a case by case basis. § 102-118.425 Is my agency allowed to perform a postpayment audit on our transportation bills? a No, your agency must forward all transportation bills to GSA for postpayment audit regardless of any waiver allowing for postpayment audit. § 102-118.430 What information must be on my agency's transportation bills submitted for a postpayment audit? Your agency must annotate all of its transportation bills submitted for postpayment audit with: (a) The date received from a TSP; (b) A TSP's bill number; (c) Your agency name; (d) A Document Reference Number; (e) The amount requested; (f) The amount paid; (g) The payment voucher number; (h) Complete tender or tariff authority, including contract price (if purchased under the Federal Acquisition Regulation), item or section number; (i) The TSP's taxpayer identification number; and (j) The TSP's standard carrier alpha code (SCAC). § 102-118.435 What procedures does GSA use to perform a postpayment audit? When GSA performs a postpayment audit, the GSA Audit Division has the delegated authority to implement the following procedures: (a) Audit selected TSP bills after payment; (b) Audit selected TSP bills before payment as needed to protect the Government's interest (i.e., bankruptcy, fraud); (c) Examine, settle, and adjust accounts involving payment for transportation and related services for the account of agencies; (d) Adjudicate and settle transportation claims by and against agencies; (e) Offset an overcharge by any TSP from an amount subsequently found to be due that TSP; (f) Issue a Notice of Overcharge stating that a TSP owes a debt to the agency. This notice states the amount paid, the basis for the proper charge for the |