"deemed necessary to facilitate the prompt and accurate rendition of accounts." (Budget and Accounting Act, 1921, sec. 312 (a) 42 Stat. 25.) In addition to other recommendations in this report involving accounting there is recommended, as a compliance with such requirement for 1937, legislation as follows: All persons in the service of the United States, its corporate or other agencies, who by virtue of their official positions receive moneys of whatsoever character which they are not authorized to retain as salary, pay, or emolument, shall account therefor directly to the Comptroller General of the United States under such regulations as he may prescribe. In the event that such accounting shall have been unduly delayed or otherwise be unsatisfactory at the time of the receipt of a requisition for an advance of public money it shall be the duty of the Comptroller General of the United States to demand the reasons therefor and to withhold approval of the requisition if in his judgment the interests of the United States so require. All laws and parts of laws, insofar as inconsistent or in conflict with the provisions of this section as here amended, are repealed. The enactment by the Seventy-fifth Congress of this much needed progressive legislation will-through the greater accounting leeway it will confer-enable accounting improvements to be inaugurated by this office productive of economy and efficiency of a magnitude long looked forward to, but unattainable because of existing law. The withholding by the Congress of its enactment will operate to preclude such results. If this Office is-as the general accounting agency of the Congress to be responsible to the Congress for the accounting progress contemplated by the framers of the Budget and Accounting Act it will be conceded, in fairness, that it should be furnished with the necessary delegated authority with which to bring it into being. The above legislation will round out, so to speak, the accounting authority which the Congress has already conferred on this Office, and, in doing so, will operate to remove certain chains in the form of statutory provisions of nearly 45 years' standing, which, howsoever necessary in the then stage of reduced and less complicated governmental accounting business, have outlived their usefulness, and survive as obstacles to the attainment of the maximum of progress in the accounting business of the Government as it exists in 1937, with its broader horizon-extending, as it does, to various acquired possessions within and without North America, its changed and more complicated conditions, economic and otherwise, and many-times increased volume of expenditures. Adjustments, world-wide in their effect, are being made in the private business affairs of the people of the United States for the meeting of the economic problems that have arisen; adjustments in the long-standing legislation inherited by the General Accounting Office, and with which it has always been and is now hedged about, are likewise needed in order that Federal accounting may keep pace with governmental conditions as they now exist. as As in explanation of the legislation more in detail it may be stated that the Dockery Act (act of July 31, 1894, sec. 12, 28 Stat. 209), amended (acts of Mar. 2, 1895, 28 Stat. 807, and May 28, 1896, sec. 4, 29 id. 179), fixed certain periods within which accounts should be sent to administrative offices in Washington, and, in turn, certain periods wherein they should be transmitted by said offices to and received by the accounting officers for audit. In the event of delinquency in such regard it placed certain waiver authority in the Secretary of the Treasury and certain control authority in the President or the Secretary of the Treasury as the case may be. The accounting officers, although possessed of accounting jurisdiction conferred directly on them by the Congress, and in that sense independent of the Secretary of the Treasury, were nevertheless then incorporated in and formed a part of the Treasury Department of which the Secretary of the Treasury was the head, and, as the head of a department of which the accounting officers were a part, invested with the rendition of accounts control. The Budget and Accounting Act, 1921 (act of June 10, 1921, 42 Stat. 23 to 27)—while it lifted the accounting officers out of the Treasury Department, and therefore out of such jurisdiction as the Secretary of the Treasury as the head of the Treasury Department had over them, and established them as an independent establishment, the General Accounting Office, with a new and separate head-did not expressly provide that the waiver and accounting control jurisdiction for account-rendering purposes then exercised by the Secretary of the Treasury and President should pass to said new accounting head. That the Budget and Accounting Act contemplated that accounting rendition control jurisdiction should thereby so pass appears evident by its direction to such head-with which this is a compliance to make recommendations to the Congress on the subject of the prompt and accurate rendition and settlement of accounts. Had it contemplated that the Secretary of the Treasury should continue as the control authority for the rendition of accounts it is logical to assume that the Congress would instead have directed the Secretary to make such recommendations. That it did not, and that it removed from the Treasury Department all accounting functionsother than such administrative ones as it shares in common with other departments and establishments-shows clearly that to keep the Federal accounting system intact, and enable it to function with a maximum of efficiency, accounting rendition control should pass to and be exercised by the head of that system-not by the head of one of the many departments and establishments to be controlled for accounts' rendition purposes but otherwise disconnected from such system. It is incongruous and out of harmony with the Budget and Accounting Act and the accounting progress contemplated by that act for it not so to pass. This incongruous situation is enhanced by the fact that the Comptroller General of the United States-not the Secretary of the Treasury-makes annually to the Congress the report required by said section 12 of the act of July 31, 1894, as amended, of the officers delinquent in rendering or transmitting their accounts to the proper officers in Washington, the names thereof, and stating, in each instance, whether the delinquency was waived, and of delinquent officers, by name and title, and by departments and establishments, who, upon final settlement of their accounts, have been found indebted to the Government and delinquent in the payment of their indebtedness. See, in this connection, said report of this office for 1936 wherein 112 officers were delinquent in rendering or transmitting accounts to the proper officers in Washington, and 2,398 officers were reported as having on June 30, 1936, failed to pay their indebtedness into the Treasury, the aggregate amount of which unpaid indebtedness to the United States was $2,236,479.58. Certain accounts rendered to this Office now cover a period of 3 months and are not received in the General Accounting Office for audit until approximately 3 months later. It is obvious that not only the Government but the disbursing officers are thereby placed at a disadvantage in the matter of recovering improper payments developed through the subsequent audit. An early audit after payment not only affords a closer check on the expenditure of appropriated moneys in the quicker detection of discrepancies and violations of law, but has the further advantage of putting disbursing officers on notice thereof in time to avoid subsequent payments of a like nature. The prompt and frequent rendition of accounts is essential to an early audit, and, in turn, an early audit is essential in order that the Federal accounting system may function with a maximum of efficiency. Some of the departments are recognizing the advantages from an administrative standpoint of a frequent rendition of accounts and an early audit. For example, the Department of State issued regulations, effective July 1, 1930, requiring that all accounts of its officersapproximately 600 in number-be rendered monthly instead of quarterly. A test had previously been made at a number of consular offices. In speaking of the reports of these tests it was said in the regulations that- * The reporting officers have predicted that a saving of time and labor will eventually be realized, in addition to the promoting of increased efficiency in both the department and in the field. It was further pointed out therein that field officers are interested because * * * they obviously will benefit from a plan which gives the department an opportunity to use its appropriations more effectively. It is believed that much more satisfactory results will be obtained by vesting in the head of the accounting system the authority to prescribe the periods within which accounts shall be rendered. Some classes of accounts by virtue of their nature and the locality to which they relate can advantageously be rendered earlier than others, and vice versa. Accordingly, in the legislation I have recommended on the subject of Federal accounting control this authority has been placed in the head of the Federal accounting system, the Comptroller General of the United States, where it is believed it should be, regardless of who may occupy that position. It is further the belief of this Office that accounts should be forwarded directly to this office by the persons accountable and responsible for the correctness of the payments to be audited, viz, the disbursing officers, in lieu of as now reaching this Office indirectly from them through the respective administrative offices which have incurred the obligations their disbursing officers have paid and for which they are claiming credit. There would be eliminated delays, expense, and other factors incident to the indirect transmission. Demands against the United States should have full and final administrative consideration before submission to disbursing officers for payment. After payment the disbursing officers should be enabled to transmit their paid vouchers, with all documents and other supporting data upon which they have relied in making the payments, administrative or otherwise, directly to this Office for audit free of after-payment administrative supervision. Accordingly, no provision has been made in the recommended legislation for the audit-delaying and expensive intermediate administrative examination of accounts of disbursing officers before their submission to this Office for audit. The legislation is of vital importance and urgently needed. Trust funds and quasi-public funds; accounting for.-See pages 33, 34. GOVERNMENT-OWNED OR CONTROLLED CORPORATIONS; ACCOUNTING FOR FUNDS The general law (sec. 3617, Rev. Stat.) requires that— The gross amount of all moneys received from whatever source for the use of the United States * * * shall be paid by the officer or agent receiving the same into the Treasury, at as early a day as practicable, without any abatement or deduction on account of salary, fees, costs, charges, expenses, or claim of any description whatever. * * Pursuant thereto this Office promulgated General Regulations No. 80 under date of August 15, 1934, which provides that moneys to be expended by fiscal officers of the United States shall be obtained upon requisition and warrant, and that any receipts and collections to be administered by any officer or employee of the United States in his official capacity should be immediately deposited for covering into the Treasury to the credit of proper receipt accounts for appropriation to properly designated expenditure accounts (or repaid to proper appropriation accounts, as the case may be). Symbols and titles for receipts and appropriations have been prescribed by this Office in General Regulations No. 44, dated June 1, 1925; General Regulations No. 67, dated June 27, 1928; and General Regulations No. 84, dated June 15, 1936. Based upon such requirements of law and regulations, the systems of administrative accounts prescribed by this Office, without exception, require that all collections received be charged to the accountable officer through whose account the funds are deposited, pending their deposit into the Treasury. Upon advice of proper covering and warrant making the funds available, proper credit is given to the accountable officer in the accounts and the amounts thereof are taken up as "Treasury cash" by appropriation symbols and titles, from which accounts the funds may be requisitioned and advanced to disbursing officers for disbursing purposes. It is only through such well-established procedure that a proper accounting may be rendered to this Office of all receipts and expenditures of the several agencies of the Federal Government. Exception has been taken to such procedure by certain governmental corporations and agencies, generally on the grounds that the general statutes are inapplicable and that the respective acts creating the agencies grant to the officials thereof authority to receive and expend the public funds under their respective jurisdictions without the necessity of covering the said funds into the Treasury for appropriation and for expenditure only pursuant to proper requisition and warrant. To such extent the following agencies have not complied with the law, regulations, and systems of accounts prescribed: Electric Home and Farm Authority. Federal Savings and Loan Insurance Corporation. Home Owners' Loan Corporation. The Virgin Islands Co. Such agencies follow a procedure of depositing their receipts and collections with the Treasurer of the United States to the credit of official checking (disbursing) accounts of the accountable officers thereof, from which accounts the funds are expended. Accordingly, under such procedure the collections are not covered into the Treasury and are never reflected as receipts and expenditures on the books of the Government, with the result that hundreds of millions of dollars have been received and expended by the Federal Government or agencies thereof without having been covered into the Treasury and for which a proper accounting and audit is not had. No accounts are rendered to this Office by the following agencies among those listed, supra: Federal Deposit Insurance Corporation. Federal Savings and Loan Insurance Corporation. The following agencies among those listed, supra, are rendering accounts: Electric Home and Farm Authority. While such agencies render accounts, the funds thereof have not been covered into the Treasury and appropriated as prescribed, and accordingly the accounts must be handled and settled as special deposits. With respect to agencies not required by law to render accounts to this Office and those which are not complying with such requirements, there is given below a list of the agencies, including Government corporations, whose accounts it is considered are not subject to audit by the General Accounting Office, together with a brief statement of the reasons therefor. Federal Reserve banks.-The capital stock of the Federal Reserve banks is all owned by member banks. Necessary expenses of the banks are paid from earnings. No Federal funds are involved and therefore the accounts are not considered as subject to audit by the General Accounting Office. Federal Reserve Board. To meet its expenses and to pay the salaries of its members and employees the Board, under the authority of section 10 of the Federal Reserve Act, as amended, makes semiannual assessments upon the Federal Reserve banks in proportion to their capital stock and surplus. The Attorney General in 1914 ruled that such assessments were "public moneys" and that the Board was a "board" or "establishment" within the meaning and intent of section 7 of the act of July 31, 1894. Such moneys were accordingly deposited into the Treasury to the credit of a "special fund" and accounted for, and audited by the General Accounting Office up to and including the fiscal year 1933. The Banking Act of 1933 (48 Stat. 167), amending section 10 of the Federal Reserve Act, as amended, provided in part that The Board shall determine and prescribe the manner in which its obligations shall be incurred and its disbursements and expenses allowed and paid, and may leave on deposit in the Federal Reserve banks the proceeds of assessments levied upon them to defray its estimated expenses and the salaries of its members and employees, whose employment, compensation, leave, and |