AN ACT

To simplify accounting, facilitate the payment of obligations, and for other

purposes.

Be it enacted by the Senate and House of Representatives of the

United States of America in Congress assembled, That (a) the account Government oblifor each appropriation available for obligation for a definite period gations. of time shall be closed as follows:

Accounting prooedure.

(1) On June 30 of the second full fiscal year following the fiscal Merged accounts. year or years for which the appropriation is available for obligation,

the obligated balance shall be transferred to an appropriation account

of the agency or subdivision thereof responsible for the liquidation of 70 Stat. 647. the obligations, in which account shall be merged the amounts so trans- 70 Stat. 648. ferred from all appropriation accounts for the same general purposes;

and

(2) Upon the expiration of the period of availability for obligation, Withdrawal of the unobligated balance shall be withdrawn and, if the appropriation unobligated was derived in whole or in part from the general fund, shall revert to balance. such fund, but if the appropriation was derived solely from a special or trust fund, shall revert, unless otherwise provided by law, to the fund from which derived: Provided, That when it is determined necessary by the head of the agency concerned that a portion of the unobligated balance withdrawn is required to liquidate obligations and effect adjustments, such portion of the unobligated balance may be restored to the appropriate accounts: Provided further, That prior Reports. thereto the head of the agency concerned shall make such report with respect to each such restoration as the Director of the Bureau of the Budget may require, and shall submit such report to the Director, the Comptroller General, the Speaker of the House of Representatives, and the President of the Senate.

(b) The withdrawals required by subsection (a) (2) of this section Time. shall be made

(1) not later than September 30 of the fiscal year immediately following the fiscal year in which the period of availability for obligation expires, in the case of an appropriation available both for obligation and disbursement on or after the date of approval of this Act; or

(2) not later than September 30 of the fiscal year immediately following the fiscal year in which this Act is approved, in the case of an appropriation, which, on the date of approval of this Act, is available only for disbursement.

(c) For the purposes of this Act, the obligated balance of an appro- Obligated balpriation account as of the close of the fiscal year shall be the amount ance. of unliquidated obligations applicable to such appropriation less the amount collectible as repayments to the appropriation; the unobligated balance shall represent the difference between the obligated balance reported pursuant to section 1311 (b) of the Supplemental Appropriation Act, 1955 (68 Stat. 830; 31 U. S. C. 200 (b)), and the total unexpended balance. Collections authorized to be credited to Collections. an appropriation but not received until after the transfer of the obligated appropriation balance as required by subsection (a) (1) of this Act, shall, unless otherwise authorized by law, be credited to the account into which the obligated balance has been transferred, except that any collection made by the General Accounting Office for other Government agencies may be deposited into the Treasury as miscellaneous receipts.

(d) The withdrawals made pursuant to subsection (a) (2) of this Accounting and section shall be accounted for and reported as of the fiscal year in reporting of

withdrawals.

Payment of obligations.

70 Stat. 648. 70 Stat. 649.

Agency review.

GAO report to ageney, Treasury, and Budget.

Certified olaims.

Obligated balanoes for definite periods.

which the appropriations concerned expire for obligation. The withdrawals described in subsection (b) (2) of this section shall be accounted for and reported as of the fiscal year in which this Act is approved.

SEC. 2. Each appropriation account established pursuant to this Act shall be accounted for as one fund and shall be available without fiscal year limitation for payment of obligations chargeable against any of the appropriations from which such account was derived. Subject to regulations to be prescribed by the Comptroller General of the United States, payment of such obligations may be made without prior action by the General Accounting Office, but nothing contained in this Act shall be construed to relieve the Comptroller General of the United States of his duty to render decisions upon requests made pursuant to law or to abridge the existing authority of the General Accounting Office to settle and adjust claims, demands, and accounts.

SEC. 3. (a) Appropriation accounts established pursuant to this Act shall be reviewed periodically, but at least once each fiscal year, by each agency concerned. If the undisbursed balance in any account exceeds the obligated balance pertaining thereto, the amount of the excess shall be withdrawn in the manner provided by section 1 (a) (2) of this Act; but if the obligated balance exceeds the undisbursed balance, the amount of the excess, not to exceed the remaining unobligated balances of the appropriations available for the same general purposes, may be restored to such account. A review shall be made as of the close of each fiscal year and the restorations or withdrawals required or authorized by this section accomplished not later than September 30 of the following fiscal year, but the transactions shall be accounted for and reported as of the close of the fiscal year to which such review pertains. A review made as of any other date for which restorations or withdrawals are accomplished after September 30 in any fiscal year shall be accounted for and reported as transactions of the fiscal year in which accomplished: Provided, That prior to any restoration under this subsection the head of the agency concerned shall make such report with respect thereto as the Director of the Bureau of the Budget may require.

(b) In connection with his audit responsibilities, the Comptroller General of the United States shall report to the head of the agency concerned, to the Secretary of the Treasury, and to the Director of the Bureau of the Budget, respecting operations under this Act, including an appraisal of the unliquidated obligations under the appropriation accounts established by this Act. Within thirty days after receipt of such report, the agency concerned shall accomplish any actions required by subsection (a) of this section which such report shows to be necessary.

SEC. 4. During the fiscal year in which this Act becomes effective, and under rules and regulations to be prescribed by the Comptroller General of the United States, the obligated balance of the appropriation account for payment of certified claims established pursuant to section 2 of the Act of July 6, 1949 (63 Stat. 407; 31 U. S. C. 712b), shall be transferred to the related appropriation accounts established pursuant to this Act and the unobligated balance shall be withdrawn. SEC. 5. The obligated balances of appropriations made available for obligation for definite periods of time under discontinued appropriation heads may, upon the expiration of the second full fiscal year following the fiscal year or years for which such appropriations are available for obligation, be merged in the appropriation accounts provided for by section 1 hereof, or in one or more other accounts to be established pursuant to this Act for discontinued appropriations of the

agency or subdivision thereof currently responsible for the liquidation

of the obligations.

SEC. 6. The unobligated balances of appropriations which are not Unobligated ballimited to a definite period of time shall be withdrawn in the manner ances.

provided in section 1 (a) (2) of this Act whenever the head of the Unlimited periods. agency concerned shall determine that the purposes for which the appropriation was made has been fulfilled; or in any event, whenever disbursements have not been made against the appropriation for two full consecutive fiscal years: Provided, That amounts of appropriations not limited to a definite period of time which are withdrawn pursuant to this section or were heretofore withdrawn from the appro

priation account by administrative action may be restored to the 70 Stat. 649. applicable appropriation account for the payment of obligations and 70 Stat. 650. for the settlement of accounts.

SEC. 7. The following provisions of law are hereby repealed: (a) The proviso under the heading "PAYMENT OF CERTIFIED CLAIMS in the Act of April 25, 1945 (59 Stat. 90; 31 U. S. C. 690) ;

(b) Section 2 of the Act of July 6, 1949 (63 Stat. 407; 31 U. S. C. 712b), but the repeal of this section shall not be effective until June 30, 1957;

(c) The paragraph under the heading "PAYMENT OF CERTIFIED CLAIMS” in the Act of June 30, 1949 (63 Stat. 358; 31 U. S. C. 712c); (d) Section 5 of the Act of March 3, 1875 (18 Stat. 418; 31 U. S. C. 713a); and

(e) Section 3691 of the Revised Statutes, as amended (31 U. S. C. 715).

(f) Any provisions (except those contained in appropriation Acts for the fiscal years 1956 and 1957) permitting an appropriation which is limited for obligation to a definite period of time to remain available for expenditure for more than the two succeeding full fiscal years, but this subsection shall not be effective until June 30, 1957.

Repeals.

SEC. 8. The provisions of this Act shall not apply to the appropria- Nonapplicabiltions for the District of Columbia or appropriations to be disbursed 1ty. by the Secretary of the Senate or the Clerk of the House of Repre

sentatives.

SEC. 9. The inclusion in appropriation Acts of provisions excepting Authorized any appropriation or appropriations from the operation of the pro- exceptions. visions of this Act and fixing the period for which such appropriation or appropriations shall remain available for expenditure is hereby authorized.

Approved July 25, 1956.

G. To Improve Governmental Budgeting and Accounting Methods and Procedures, and for Other Purposes

(70 Stat. 782)

This act was the result of the enactment of S. 3897, 84th Congress. It was approved on August 1, 1956, as Public Law 863, 84th Congress. The text of the act appears in volume 70, Statutes at Large, pages 782-783. Its provisions are codified in 31 U.S.C. 11 et seq.

LEGISLATIVE HISTORY OF PUBLIC LAW 863, 84TH CONGRESS

1. CONGRESSIONAL RECORD REFERENCES TO DEBATES, ETC.

(Page citations are to vol. 102, Congressional Record)

S. 3897: To improve governmental budgeting and accounting methods and procedures, and for other purposes. Mr. Kennedy, Mr. Payne, Mr. Byrd, Mr. Bridges, Mr. McClellan, Mr. Jackson, Mr. Humphrey, Mr. McCarthy, Mr. Mundt, Mrs. Smith of Maine, Mr. Bender, Mr. Martin of Iowa, Mr. Walker, Mr. Chavez, Mr. Hruska, Mr. Bush, Mr. Flanders, Mr. Ives, Mr. Thye, Mr. Magnuson, Mr. Saltonstall, Mr. Butler, Mr. Martin of Pennsylvania, Mr. Dirksen, Mr. Bennett, Mr. Curtis, Mr. Smith of New Jersey, Mr. Beall, Mr. Mansfield, Mr. Case of South Dakota, Mr. Langer, and Mr. Barrett: Committee on Government Operations, 5824, 8771. Reported (S. Rept. 2265), 10557. Debated, 10594. Passed Senate, 10633. Referred to House Committee on Government Operations, 10790. Committee discharged; amended and passed House (in lieu of H.R. 11526), 12692. Senate disagrees to House amendment and asks for a conference, 13076. Conferees appointed, 13076. House insists on its amendment and agrees to a conference, 13378. Conferees appointed, 13378. Conference report (H. Rept. 2872) submitted in House and agreed to, 14007. Conference report submitted in Senate and agreed to, 14338. Examined and signed, 14996, 15295. Presented to the President, 15146. Approved (Public Law 863), 15150.

H.R. 11526: To improve governmental budgeting and accounting methods and procedures, and for other purposes. Mr. Rogers of Florida; Committee on Government Operations, 9275. Reported with amendment (H. Rept. 2734), 12966. Amended and passed House, 12692. Proceedings vacated; laid on the table (S. 3897) passed in lieu, 12693.

2. SERIAL NUMBERS OF BOUND VOLUMES OF CONGRESSIONAL REPORTS RELATING TO PUBLIC LAW 863, 84TH CONGRESS

Senate Report 2265, 84th Congress, 11889.

House Report 2734, 84th Congress, 11900.

House Report 2872 (conference), 84th Congress, 11900.

3. CONGRESSIONAL HEARINGS RELATING TO PUBLIC LAW 863, 84TH CONGRESS

Senate Committee on Government Operations, 84th Congress : Budgeting and Accounting, June 4, 5, 6, 1956, on S. 3897.

AN ACT

To improve governmental budgeting and accounting methods and procedures, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in l'ongress assembled,

AMENDMENTS TO THE BUDGET AND ACCOUNTING ACT, 1921

SEC. 1. (a) Section 201 of the Budget and Accounting Act, 1921,

Government budget and accounting procedure.

as amended (31 U. S. C. 11), is further amended by inserting "(a)" 64 Stat. 832. after the words "SEC. 201."; by changing subsection (a) to subparagraph (1); by adding after subparagraph (1) a new subparagraph (2) at such times as may be practicable, information on program costs and accomplishments"; by changing subsections (b) through (j) to subparagraphs (3) through (11), respectively.

(b) Section 216 of such Act, as amended (31 U. S. C. 24), is further 64 Stat. 834. amended by inserting "(a)" after the words "SEC. 216." and by adding

the following new subsections:

appro

Cost-based

"(b) The requests of the departments and establishments for priations shall, in such manner and at such times as may be determined budgets. by the President, be developed from cost-based budgets.

"(c) For purposes of administration and operation, such cost-based budgets shall be used by all departments and establishments and their subordinate units. Administrative subdivisions of appropriations or funds shall be made on the basis of such cost-based budgets.

AMENDMENTS TO THE BUDGET AND ACCOUNTING PROCEDURES ACT OF 1930

SEC. 2. (a) The Budget and Accounting Procedures Act of 1950 is amended by inserting after section 105 thereof the following new 64 Stat. 834. section:

"ACCOUNTING AND BUDGET CLASSIFICATIONS

"SEC. 106. The head of each executive agency shall, in consultation with the Director of the Bureau of the Budget, take whatever action may be necessary to achieve, insofar as is possible, (1) consistency in accounting and budget classifications, (2) synchronization between accounting and budget classifications and organizational structure, and (3) support of the budget justifications by information on performance and program costs by organizational units."

31 USC 847.

(b) Section 113 of such Act (31 U. S. C. 66a) is amended by adding 64 Stat. 836. at the end thereof the following new subsection:

70 Stat. 782.

"(c) As soon as practicable after the date of enactment of this sub- 70 Stat. 783. section, the head of each executive agency shall, in accordance with principles and standards prescribed by the Comptroller General, cause the accounts of such agency to be maintained on an accrual basis to show the resources, liabilities, and costs of operations of such agency with a view to facilitating the preparation of cost-based budgets as required by section 216 of the Budget and Accounting Act, 1921, as amended. The accounting system required by this subsection shall include adequate monetary property accounting records as an integral part of the system."

(c) Section 118 of such Act is amended by inserting “113 (c)" after 64 Stat. 837. the words "section 111".

31 USC 65a.