compedium philosophy, glossary of terms

8/12/2019 compedium philosophy, glossary of terms

1/79

Glossary of Terms

Accrual basis of accounting-An accounting method that attempts to recognizerevenues when they are earned and expenses when they are incurred, not when cash

changes hands. The Governmental Accounting Standards Board (GASB) requires thisaccounting method for governments for periods beginning after June 15, 2001. Contrastthis term to "modified accrual basis of accounting."

Activity- A component part of the District's program structure. Comprised of a set ofservices grouped around a common purpose or result.

Agency Financial Operations Program (AFO)-A program within an agency's strategicbusiness plan structure under

Performance-Based Budgeting.-AFO is used to track the funding and FTE count for

all OCFO FTEs assigned to the agencies. Though many of these employees work on-site at agency locations, all financial positions within District agencies report to the ChiefFinancial Officer. Under AFO, these costs fall within one of three activities: (1) BudgetOperations, (2) Accounting Operations, (3) ACFO. Six Associate Chief FinancialOfficers (ACFOs), each representing one of the major appropriation titles in the District'sbudget, manage agency financial operations. Agency fiscal officers report to theirrespective ACFO, who serves as the key contact between the Office of Chief FinancialOfficer and the Office of the City Administrator in managing the agency finances. Forbudgetary purposes, funding for these positions assigned to the agencies is included inthe various agency budgets. This funding is not duplicated in the budget for the OCFO.

Agency Management Program (AMP) -A program within an agency's strategicbusiness plan structure under Performance-Based Budgeting. AMP is used to trackcosts associated with common administrative expenses across the District. Under

AMP, these costs fall within 15 activities: (1) Personnel, (2) Training and EmployeeDevelopment, (3) Labor-Management Partnerships, (4) Contracting and Procurement,(5) Property Management, (6) Information Technology, (7) Financial Management, (8)Risk Management, (9) Legal Services, (10) Fleet Management, (11) Communications,(12) Customer Service, (13) Performance Management, (14) Language Access, and(15) Court-Ordered Supervision.

Allocable Revenue -Revenue earned, collected, and used by the agency responsible

for generating the revenue.

Amendment -A proposed change to a budget that is not yet finally approved, but hasbeen formally submitted by the executive to the legislative branch.

Annualization -A budget increase to provide full-year budget authority for a budgetaryitem that was only partially funded in the prior-year budget.


2/79

Appropriated Revenue-Revenue collected by an agency on behalf of the DistrictTreasury; such revenue is used to support the operations of all agencies.

Appropriation -Authority to spend funds appropriated by Congress and financed bygeneral District revenues.

Appropriation Group- The eight broad areas that the District categorizes services tothe citizens of Washington D.C. They include Governmental Direction and Support,Economic Development and Regulation, Public Safety and Justice, Public EducationSystem, Human Support Services, Public Works, Financing and Other, and EnterpriseOther Funds.

Arbitrage -The simultaneous buying and selling of the same negotiable financialinstruments or commodities in different markets in order to make an immediate profitwithout risk.

ASMP -Administrative Services Modernization Program. A District-wide businesstransformation project focused on improving administrative processes, systems, andpolicies across the operating agencies, administrative agencies, and financial agencies.

Attrition -Voluntary employment losses, such as retirements and resignations.

Bonds -Officially called debt securities, bonds provide ways for governments to raiselarge sums of money by borrowing. Bonds usually have a principal amount and acontract interest rate. The principal can be paid at maturity while the interest is generallypaid semi-annually as a percent of the principal. For example, a government could issue$10,000,000 in bonds with a 5 percent interest rate. If the bonds matured in five years,

then the $10,000,000 would have to be paid to the bondholder. During that period,$500,000 would have to be paid in interest each year or $250,000 semi- annually.These bonds would be called term bonds, since they are due at a fixed point in time.Serial bonds come due at different points in time.

Bond Rating -A bond rating is an independent assessment of the creditworthiness of abond (note or any security of indebtedness) by a credit rating agency. The three primaryrating agencies are Standard & Poor's (S & P), Moody's Investor Services (Moody's),and Fitch IBCA, Inc. (Fitch IBCA). Bond ratings measure the probability of the timelyrepayment of principal and interest of a bond. Generally, a higher credit rating wouldlead to a more favorable effect on the marketability of a bond. The credit rating symbols

(long-term) are generally assigned with the highest and the lowest in investment grade.The table below denotes the bond rating codes of the various rating agencies. Budget -A plan of financial and operational intent embodying an estimate of proposedexpenditures for a given period and proposed means of financing.


3/79

Budget Authority -Authority provided by law to enter into obligations that will result inexpenditures. It may be classified by the period of availability (one-year, multiple-year,no-year), by the timing of congressional action (current or permanent), or by the mannerof determining the amount available (definite or indefinite).

Budget Establishment -The period immediately preceding the beginning of the budgetfiscal year during which final revenue budgets, intra-District budgets, and expenditurebudgets are prepared and entered into the formal accounting records of the District.

Budget Modification -A change in any portion of the budget during the fiscal year.

Budget Preparation -The budget planning and development process from the initialbudget call, up to and including final approval by Congress.

Budget Reserve -Funds that are earmarked for special purposes to protect the Districtagainst shortfalls in revenue and unforeseen expenditures.

Capital Improvements Program (CIP) -A plan for initiating the development,modernization, or replacement of Districtowned facilities during a six-year period. Asannually revised, this plan provides the basis for future-year capital budget requests.

CAFR - State and local governments issue an annual financial report called theComprehensive Annual Financial Report or CAFR. The CAFR has three parts: (1) anintroductory section, (2) a financial section, and (3) a statistical section. Some but not all


4/79

of what goes into the CAFR is shaped by the Governmental Accounting StandardsBoard (GASB), which is the current authoritative source for governmental Generally

Accepted Accounting Principles (GAAP). The groups that use the CAFR mostextensively and rely on it heavily consist of the agencies that rate state and localgovernments for purposes of sale of bonds. Institutions that buy and sell these bonds

would also be among the users of the CAFR. Moodys, Fitch IBCA, and Standard andPoors are among the best known rating agencies. The people who rate or buy and sellthese bonds are among the most capable of reading, analyzing, and interpreting theCAFR.

Certificates of Participation (COP) -In a typical lease-purchase arrangement, theDistrict as lessee purchases property under contract from lessor, usually a privatecorporation, another public entity, or a special purpose nonprofit corporation. Thelessor receives a portion of each lease payment as taxexempt interest. One commonway of financing this is the Certificate of Participation (COP), where the lessor assignsthe lease and lease payments to a trustee. The lease underlying the COP will usually

state the obligation (GO) bond of the District.

Charter School-A private non-profit entity that accepts and educates public schoolstudents under the terms of a charter granted by one of the Districts two charteringauthorities. Charter Schools receive the same public funding as DCPS pursuant to theDistricts uniform per student funding formula; additionally, a facilities allowance is alsoprovided.

Chart of Accounts -A chart of expenditure and revenue accounts used to record eachtype of financial transaction incurred by District agencies.

Collateral- Security left with a creditor to assure the performance of the obligor. Whenthe obligor has performed, the creditor must return the collateral.

Community Development Block Grant (CDBG) -A federal grant that supportshousing, economic development, health and human services, and planning andadministration.

Component Unit -Legally separate organizations for which elected officials of theDistrict are financially accountable. Accountability exists because some or all of thegoverning bodies of all the component units are appointed by the Mayor with theconsent of the Council. All component units use proprietary

fund type accounting.

Consolidated Plan -The U.S. Department of Housing and Urban Development requiresa single or consolidated plan and submission for the following federal grant programs:Community Development Block Grant, HOME Investments Partnerships Program,Emergency Shelter Grants (ESG), and the Housing Opportunities for Persons with AIDS(HOPWA) grant.


5/79

Contractual Services -A budgetary classification of nonpersonal services that includesfunds for contractual services.

Control Center -A unit of budgetary and financial control in the Districts financialmanagement system. Each District agency is composed of one or more control

centers.

Controllable Property - Non-capitalized tangible property that is considered valuableand/or sensitive with a high risk of theft with a value of less than $5,000 and/or with anexpected life of less than three years.

Current Services Budget -An estimate of the funds needed to continue existing levelsof service in the next fiscal year.

Debt Ratio -Total debt divided by total assets.

Debt Service -Scheduled payment of the interest and principal to bond holders that isnecessary to retire bond indebtedness.

Dedicated Taxes -Tax revenues that are dedicated by law to a particular agency for aparticular purpose.

Emergency Shelter (ESG) -Federal grants to provide capital and operating support foremergency shelters and transitional housing for the homeless.

Encumbrance -An amount of funds committed for the payment of goods and servicesordered but not yet received.

Energy, Rent, and Communications - The name of the object class used to allocatefunds for those needs.

Enterprise Funds - Budget and accounting units created for particular purposes, suchas water and sewer or other self-sustaining operations, to separate the revenue andfinancial control of such operations from the District's General Fund.

Entitlement -A service or grant that, under District or Federal law, must be provided toall applicants.

Equipment and Equipment Rental - The name of the object class used to allocatefunds for such needs.

Escrow -A written agreement or instrument setting up for the allocation funds orsecurities deposited by the giver or grantor to a third party (the escrow agent), for theeventual benefit of the second party (the grantee). The escrow agent holds the deposituntil certain conditions have been met.


6/79

Expenditure -A payment for goods or services received.

Federal Funds

1. Federal Grants: Funding provided by the Federal government via a Federal agency

for a specific purpose with the conditions for the administration of the funding dictatedby each grantor organization.

2. Federal Payments: Funding specifically detailed in the Federal Funds portion of theDistrict of Columbia Appropriations Act with the conditions for the administration of thefunding found within the statute and Federal Appropriations law.

3. Federal Medicaid Payments: Funding provided to pay for a portion of the health carecosts of eligible individuals, with oversight done by District and Federal authorities.

Fixed assets -Long-lived tangible items that provide a benefit for a number of future

periods.

Fixed Costs - Expenses that do not change in proportion to the activity of a business,and are related to the everyday functioning of a business. In the District, fixed costs arecategorized as electricity, heating fuel, janitorial services, natural gas, occupancy,telecom, postage, rent, security services, steam, water and sewer, and fleet fuel andservices. While the expense item is fixed, the costs do have variability. Rate fluctuationsand consumption levels play a large part in determining the amount of fixed costs.

Fringe Benefits -Part of overall employee compensation, including life and healthinsurance and retirement and social security contributions.

Full-Time Equivalent (FTE) -An employment indicator that translates the total numberof hours worked in a year by all employees, including part-time workers, to anequivalent number of work years. For example, one FTE equals 2,080 hours and .75FTE equals 1,560 hours.

Fund -A budgeting and accounting device used to establish accounts for separatingrevenues and their related obligations, and expenditures for one purpose from thoserevenues, obligations, and expenditures for other purposes.

Fund Accounting -Accounting method of providing information on the District of

Columbia receipts and disbursements in separate categories or funds. Governmentsuse fund accounting to segregate sources of revenue and the purpose for which theyare to be used.

Fund Balance -The difference between fund assets and fund liabilities. The fundbalance is cumulative over the life of the fund.


7/79

Generally Accepted Accounting Principles (GAAP) - Uniform minimum standard ofguidelines for financial accountingand reporting that the District follows. They govern theform andcontent of an entitys (public, private, non-profit) basic financialstatements.GAAP encompasses the conventions, rules and procedures necessary to defineaccounting practices at a particulartime.

GASB -The Governmental Accounting Standards Board (GASB) is a private non-profitbody responsible for establishing and improving accounting and financial reportingstandards for more than 84,000 governmental units in the United States. Although theydo not have the force of law, governments are required to follow GASB standards inorder to obtain clean opinions from their auditors and failure to comply with GASBstandards can adversely affect a state or local governments attempts to issue bonds.

GFOA -The Government Finance Officers Association of the United States and Canadais the premier association of publicsector finance professionals and is dedicated toproviding highquality support to state and local governments. The GFOAs two

established criteria for financial excellence include: (1) the Distinguished BudgetPresentation Award (Budget Program) conferred on governments whose budgets aredeemed exemplary as a policy document, financial guide, operations guide, andcommunication device; (2) Certificate of Achievement for Excellence in FinancialReporting (CAFR Program) for governments whose CAFRs achieve the higheststandards in financial reporting.

GPRA - Government Performance and Results Act. Legislation that requires theestablishment of a direct relationship between the use of federal funds and the deliveryof services by federal agencies. Many federal grants require GPRA performancemeasures as part of the reporting process.

General Fund -The General Fund, which is the principal operating fund of the District,is used to account for all financial resources except those required to be accounted forin another fund.

General Obligation Bonds -Bonds sold by a municipal government to private investorsto provide long-term financing for capital project needs. Repayment of the principal andinterest is made from General Fund revenue.

Gift funds -Financial donations to the District government, which may only be acceptedon behalf of the District by the Mayor, that may be earmarked for a specific purpose.

Grant -Contributions of assets (usually cash) by one government unit to anothergovernment unit or organization. Typically, these contributions are made to Localgovernments from State and Federal governments for specified purposes.

Gross Budget -A total budget amount that includes resources from all funding sources.


8/79

HOME - Home Investment Partnerships Program. A federal grant program thatprovides housing for low-income persons.

Imprest Fund -A fund of a designated amount out of which payments for expenses ofsmall amounts are made (sometimes referred to as petty cash).

Indirect Costs -Administrative overhead costs incurred by the District in managinggrant programs.

Industrial Revenue Bond -A bond that enables the District to borrow money to financeor refinance undertakings in the areas of housing, health facilities, transit, college anduniversity programs which provide loans for the payment of educational expenses for oron behalf of students, pollution control facilities, and industrial and commercialdevelopment.

Inflation -An increase in general price of goods or services resulting in a decline in the

purchasing power of currently available money.

Infrastructure -Long-lived assets such as highways, bridges, buildings and publicutilities.

Interest Accrual -The amount of interest owed on borrowings but not to be paid until alater date.

Intra-District -An accounting mechanism to track payments for services provided byone District agency to another District agency, similar to an Internal Service Fund.

Key Result Measures -A set of result performance measures that are contained withineach program. They are comprised of one result measure from each of the activitieswithin that program.

Local Education Agency (LEA) -An education agency at the local level which existsprimarily to operate schools or to contract for educational services. This term is usedsynonymously with the terms "school district, " school system," and "local basicadministrative unit."

Local revenue -Includes tax and non-tax revenue that is not earmarked for a particularpurpose and is allocated to fund District programs during the annual budget process

part of General Fund revenue.

Match -A locally provided cash or in-kind services contribution required to supplementor equal a grant or gift as a condition for receiving the funds.

Mandate -Any responsibility, action or procedure that is imposed by one governmenton another through constitutional, legislative, administrative, executive, or judicial actionas a direct order, or that is required as a condition of aid.


9/79

Mission -The mission is a clear, concise statement of the purpose of the agency. Themission focuses on the broad, yet distinct, results the agency will achieve for itscustomers. Also, the reason for the existence of an agency.

Modified accrual basis of accounting -A basis of accounting that recognizes

revenues when earned, only so long as they are collectible within the period or soonenough afterwards to be used to pay liabilities of the current period. That is, revenuesare only recognized under modified accrual accounting to the degree that they areavailable to finance expenditures of the fiscal period.

Municipal Bond -A bond issued by a state or a political subdivision. Also a bondissued by a state, agency or authority. In general, interest paid on municipal bonds isexempt from federal income taxes and state and local taxes in the state of issue.

NAICS - Beginning in 1997, The North American Industry Classification System(NAICS, pronounced nakes) has replaced the Standard Industrial Classification (SIC).

NAICS is a uniform industry-wide classification system designed as the index forstatistical reporting of all economic activities of the U.S; Canada, and Mexico. This newsix digit code is a major revision that provides for newer industries and reorganizes thecategories on a production/process-oriented basis compared to the SIC that used amixture of production-based and market-based categories.

Nonpersonal Services (NPS) -A budget category that includes budget objects forreporting other than personnel-related expenditures. Nonpersonal services includessupplies, utilities, communications and rent, other services and charges, subsidies andtransfers, equipment and equipment rental, and debt service. NonrecurringExpenditures - One-time expenditures for special items, such as a new fire truck or a

computer system, that do not need to be budgeted for again in the year following theirpurchase.

Notice of Funding Availability (NOFA) -A public notice that an agency will issue aRequest for Applications (RFA), informing interested parties when and where an RFAmay be obtained.

Object Category - the category of object classes for which the District budgets in theoperating budget. There are two object categories: Personal Services (salaries, fringebenefits, additional pay, and overtime) and Nonpersonal Services (all object classesthat are not personal services).

Object Class -A budgetary classification that breaks down the object categories ofpersonal services and nonpersonal services into more specific types of expenditure,such as Fringe Benefits (Object Class 14) or Supplies (Object Class 20).

Objectives - Measurable activities of a program that are sought to achieve the overallmission.


10/79

Obligations -The amount of expenditure already made as well as the cost ofcommitments requiring future payments.

Occupational Classification Codes (OCCs) Classification system used to identifyemployees by function. The eight major OCCs are based on the following job

descriptions:

Officials and Administrators -Employees make broad policies; exercise responsibility forthe implementation of these policies; or, direct individual departments or special phasesof an agencys operations; or, provide consultation on a regional, district or area widebasis;

Professionals -Employees must have specialized and theoretical knowledge usuallyacquired through college training, job experience, or other comparative training;

Technicians -Employees must have a combination of basic scientific or technical

knowledge and manual skills obtained through specialized post-secondary schooleducation or equivalent on- the-job training;

Protective Service Workers - Employees perform public safety, security, and protectionfrom destructive forces duties;

Paraprofessionals -Employees perform some professional or technician duties but onlyin a supportive role. Assignments usually require less formal training and/or experiencethan required of professional or technical employees;

Office and Clerical - Employees must communicate within and outside their office

setting, in addition to recording and retrieving information;

Skilled Craft Workers -Employees perform work which requires special manual skillsgained from on-the-job training, apprenticeship, or formal training programs; and

Service and Maintenance -Employees perform duties related to the comfort,convenience, hygiene or safety of the public; or, maintain buildings, facilities or groundsof public property. Workers in this group may operate machines.

Operating Budget -The budget that encompasses the day-today District activities. Theoperating budget includes employee salaries, supplies, and other non-personnel items

related to current activities. The operating budget also includes debt service andoverhead costs related to daily operations.

Other Services and Charges -A budgetary classification of nonpersonal services thatincludes funds for printing, postage, tuition, travel, conference, and membership dues.


11/79

Personal Services (PS) -A budget category that includes budget objects for reportingpersonnel-related expenditures. Personal Services includes Regular Pay, Other Pay,

Additional Gross Pay, and Fringe Benefits.

Performance-Based Budgeting (PBB) -Refers to a budget system in which budget

decisions are based on or informed by performance information that describes the costor efficiency of producing and activity and the results achieved for customers. This isaccomplished by structuring the accounting and budgeting systems according to thestructure of the agency's Strategic Business Plan.

Performance Measures -Measures that describe the information managers and otherdecision-makers need in order to make good business decisions. There are four typesof measures: (1) results, (2) outputs, (3) demand, and (4) efficiency.

Private Revenue - Funding from private grants that is retained by the agency to fundthe intended purpose of the grant.

Program -A component part of the District's program structure. Comprised of a set ofactivities that have a common purpose or result, organized as a sub-unit of an agencyfor accounting, budgeting, planning and performance measurement purposes.

Program structure -The delineation of programs, activities, and services that constitutethe work of an agency.

Proprietary Fund -Fund category that often emulates the private sector and focuses onthe measurement of net income. Expenditures are funded by user charges and feesrepresented as enterprise funds in the CAFR.

Qualified Zone Academy Bond -A federal program that provides tax credits on bondsissued to finance projects for schools construction in eligible low income schools.Through a tax credit to the lending institution, the federal government covers all of theinterest on these bonds, resulting in saving up to 50 percent of the cost theserenovation and improvement projects.

Real (Constant) Dollars -The value of current-year dollars adjusted to account forinflation.

Redirections -The permanent shift of funds or positions within an agency.

Regular Pay -Salary and wages for all continuing full-time employees.

Reorganization -Refers to changes in the budget and reporting structures withinagencies.


12/79

Reprogramming -Any budget modification for purposes other than those originallyplanned, which results in an offsetting reallocation of funds from one budget category toanother, .

Request for Applications (RFA) -The document that describes the requirements for

subgrant applications.

Request for Proposal (RFP) -The official document requesting from prospectivecontractors a detailed description of the manner in which they plan to achieve the goalsspecified by the RFP were they awarded a contract to do so. The plan usually includesthe proposers estimate of total cost and required schedule.

Rescission -A legislative cancellation of budget authority previously approved by theCouncil and the Congress.

Responsibility Center -A component of a control center.

Revenue Bonds -Bonds whose principal and interest are payable exclusively from theearnings of an enterprise fund.

Revenue Category -General types of revenue, such as taxes.

Revenues - The annual income or receipts of the District from taxes, charges, grants,and investments.

Revenue Class -Specific revenues, such as real property taxes.

Review panel -A team of qualified individuals responsible for reviewing, scoring, andrecommending applicants for subgrant awards.

Revolving fund -A fund account containing money that is renewed as it is used, eitherby additional appropriations or by income from the programs it finances; thus, the fundretains a balance at all times.

Service-Level Budgeting - The development of budgets at organization level four inSOAR. This is one level below the current level of budgeting for most agencies, whichis at the activity level.

Special Purpose Revenue - Funds used to account for proceeds for specific revenuesources (other than expendable trusts, special assessments, or major capital projects)that are legally restricted to expenditures for specified purposes. Formerly called O-type or other revenue.

Strategic Goal - In strategic business planning, refers to goal statements that describein measurable terms the significant results that an agency must accomplish over thenext 2 to 5 years to respond to the critical trends, issues, and challenges.


13/79

Strategic Business Plan -A strategic business plan establishes and articulates thepurpose, strategic goals, operational organization and performance expectations for anagency.

Standard Industrial Classification (SIC) code -Original set of categories for public,

non-profit, and public sector organizations used by government manufacturing and thefinancial industry as a basis of classifying organizations. SIC codes are being replacedby NAICS because of the North American Free Trade Agreement (NAFTA) between theUS, Canada, and Mexico.

Structural Balance -The degree to which revenues match expenditures over time.

Subgrant - The commitment of funds from a grant by a District government agency to agovernmental or private organization to support specific services and operations. seeDCMA Chapter 50.

Subsidies and Transfers -The name of the object class used to allocate funds for avariety of public welfare and support costs and to transfer funds to other organizations,such as the Washington Metropolitan Area Transit Authority, providing services toDistrict residents.

Supplies and Materials -The names of the budgetary object class used to allocatefunds for consumable materials.

System of Accounting and Reporting (SOAR) - Acronym for the financialmanagement system used by the District.

Tax abatement -A decrease or rebate of a tax or burden improperly made. At times atax abatement may reflect only an acknowledgment of a changed situation.

Tax Increment Financing -Tax increment financing is a method to pay for the costs ofqualifying improvements necessary to create new development or redevelopment. Thefinancing of the qualifying improvements is paid from increased prop erty and/or salestaxes generated from the new development or redevelopment that would not occur butfor such assistance.

Tobacco securitization -Securitization is a financing method whereby a party sellsbonds to investors backed by a future stream of payments. With tobacco securitization,

the future stream of payments is the periodic payments tobacco companies will make aspart of a settlement reached by the companies and various states in 1998. The Districtreceived funds up front from the proceeds of the bond sale. The investors receiveprincipal and interest payments on their bonds from the tobacco companies payments. Securitization shifts the risk that the tobacco companies will stop making settlementpayments from the government to private investors or insurers.


14/79

Trust and Agency Funds -Funds used to account for assets held by the District in atrustee capacity or as an agent for individuals, private organizations, othergovernments, and/or other funds.

Transfers - Reallocation of resources (funds or positions) among agencies or funds.

Unfunded Liabilities -Potential or actual debts for which no current funding isavailable.

Uniform Per Student Funding Formula (UPSFF) -Funding formula used by theDistrict that determines the annual appropriation of Local funds for the operation ofthe D.C. Public School System (and charter schools) based on the number of students,the grade level, and the special programs in which they are enrolled. The UPSFF isused to fund the entire school system with the exception of state level costs which arelocally funded through a separate mechanism.

WAE -The abbreviation for when actually employed, referring to part-time staff paid onan hourly basis.

Weighted Student Formula (WSF) - Funding formula used by the school system toannually fund each school. The formula is based on enrollment, grade level, specialeducation needs, free and reduced price lunch eligibility, and English as a SecondLanguage characteristics.

Within-Grade (Step) Increase -A salary increase awarded to an employee based onlongevity of service and acceptable performance.


15/79

ACCOUNT Unit of financial recordkeeping established in the Treasury to record the

financial transactions related to a particular appropriation, fund, or category of receipts.One or more accounts may be set up by the Treasury for each appropriation. Oftenused synonymously with the word appropriation.

ACCOUNTING OPERATIONS CENTER The central finance office for the NationalPark Service, located in Washington D.C. (Reston, VA), responsible for all NPSpayments and accounting.

ACCRUED EXPENDITURES Charges during a given period that reflect liabilitiesincurred and the need to pay for goods and other tangible property received, and forservices performed by employees, contractors, other government accounts, vendors,

carriers, grantees, lessors, and other payees. Expenditures accrue regardless of whencash payments are made, whether or not invoices have been rendered, and, in somecases, whether or not goods have been physically delivered.

ADMINISTRATIVE CONTROL OF FUNDS A financial management system requiredby law to restrict obligations or outlays against each appropriation to the amount of theapportionments, and which enables the head of the agency to fix the responsibility forobligations or outlays made in excess of an apportionment (or reapportionment).

ADMINISTRATIVE FINANCIAL SYSTEM (AFS-II) A PC-based financial planning andcontrol system that integrates information from the annual financial plan (10-575) with

data from the official accounting system, FFS, regarding authorized funding and actualobligations and expenditures, and with locally entered data on commitments,corrections, and accruals, in order to provide budget status information. Variousreporting options allow the user access to details of all accounting transactions, and to anumber of tracking, diagnostic, and verification tools. A planned migration to a Web-based version (AFS III) is under development.

AGENCY Any executive department, commission, authority, administration, board, orother independent establishment in the executive branch of the government.

ALLOCATION An amount set aside by an agency in an appropriation or fund account

for the use of another agency in carrying out the purpose of an appropriation. The termallocation is also used in the budget formulation process to denote distribution of ananticipated program level to various offices and regions. The tentative amount thusallocated becomes a ceiling for establishing projects within a specific fund source orpurpose. Since the National Park Service changed to only one "allottee," the term"allocation" has been generally used instead of "allotment" for distribution of funds toregions and service centers.


16/79

ALLOTMENT A specific authorization by the head of an agency (or other authorizedemployee) to a designated subordinate to incur obligations within a specified amount.Obligations or outlays cannot be made in excess of the allotment. An agency makesallotments pursuant to the requirements stated in OMB Circular No. A-34. The amountsallotted by an agency cannot exceed the amount apportioned by the OMB. With the

centralization of regional finance offices into one Accounting Operations Center, theService now has only one allottee (the director).

ALLOWANCES The amounts approved to be requested for the budget year. They arealso referred to as planning allowances. OMB sets the budget allowance at thebeginning of the budget cycle. Department allowances are the amounts that theSecretary determines will be requested from OMB for the budget year. OMB allowancesare the amounts that the President will request the Congress to appropriate for thebudget year, as communicated to the Interior Department by OMB. The programs andlevels of the allowances are confidential and not to be released to the public until thePresident's budget message is delivered to the Congress in February.

Congressional allowances, as used in the concurrent resolutions on the budget,represent a special functional classification designed to include amounts to coverpossible requirements, such as civilian pay raises and contingencies. Allowancesremain undistributed until they occur or become firm; then they are distributed to theappropriate functional classification(s).

ANTI-DEFICIENCY ACT Sometimes referred to as section 3679 of the RevisedStatutes, a law enacted by Congress to (1) prevent the incurring of obligations or themaking of expenditures or outlays in excess of amounts available in appropriations orfunds, (2) fix responsibility within an agency for the creation of any obligation or the

making of any expenditures in excess of an apportionment (or reapportionment) or inexcess of other subdivisions established pursuant to 31 USC 665(g), and (3) assist inbringing about the most effective and economical use of appropriations and funds.

APPEAL A request to decision-making officials (the secretary, OMB, the President, ormembers of Congress) that their decisions on the amount of budget authority for a givenactivity or operating unit be reconsidered. This is usually accompanied by a statementof the impact of the decision on the activity or unit. When appealing a Congressionalaction on an appropriations request, the statement of impact is termed an "effectstatement."

APPORTIONMENTA distribution made by OMB of amounts available for obligation inan appropriation or fund account. Apportionments divide amounts available by specifictime periods (usually quarters; now tri-annum) activities, projects, objects, or acombination thereof. The amounts so apportioned are a large limitation on the amountof obligations that may be incurred. The apportionment process is intended to preventobligation of funds in a manner that would require supplemental or deficiencyappropriations and to achieve the most effective and economical use of amounts madeavailable for obligation.


17/79

APPROPRIATIONS Funding authority approved by the Congress and signed by thePresident to expend a given amount of funds to carry out federal programs. Theappropriations act specifies an amount of funding in each appropriation (fund) accountof an agency. Types of appropriations include the following:

One-year available for incurring obligations only during a specified fiscal year

Multiple-year available for incurring obligations for a definite period in excess of onefiscal year

No-year

available for incurring obligations for an indefinite period of time until theobjectives have been accomplished

Unexpired available for incurring obligations during the current fiscal year and whichauthority has not expired

Expired no longer available for obligation, but is still available for disbursement to pay

existing obligations

Definite the amount stated in the Appropriations Act as a specific sum of money.

Indefinite the amount of which is not stated in the Appropriations Act as a specificsum of money, but is determinable only at some future date, such as an appropriation ofthe receipts from a certain source

Permanent automatically made each year over a period of time by virtue of standinglegislation, without annual action by Congress. Operation and Maintenance ofQuarters are two examples.


18/79

Current requires periodic action by Congress, usually annually, in or immediatelypreceding the fiscal year.

APPROPRIATIONS LANGUAGE The text of the appropriations act, as enacted byCongress. Language sets forth the amounts and purposes for which funds are provided.

Limitations, or statutory restrictions in appropriations acts, establish the maximum orminimum amounts that may be used for specific purposes. Text for a particular bureaumay include a section of Administrative Provisions applicable to that bureau only,setting forth the intent of Congress on specific authorizations or limitations on the use offunds (for example, the number of vehicles the Service can purchase, or limits onexpenditures for transporting children to parks). Such provisions may reappear year toyear, or may be for one year only. Authorizations and limitations that are binding uponall of the bureaus and offices in the Department are grouped together and enumeratedunder the heading of General Provisions. These deal with such widely varied subjectsas reprogrammings, aircraft rentals, uniform allowances and memberships.

APPROPRIATIONS TRANSFER

A transfer of funds from one appropriation accountto another. This can only be done by specific Congressional authority.

AUTHORIZING COMMITTEE A standing committee of the House or Senate withlegislative jurisdiction over the subject matter of those laws, or parts of laws, that set upor continue the legal operations of federal programs or agencies.

AUTHORIZING LEGISLATION Legislation enacted by Congress that establishes orcontinues the legal operation of a federal program or agency, either indefinitely or for aspecific period of time, or sanctions a particular type of obligation or expenditure withina program. Sometimes referred to as substantive legislation.

Authorizing legislation is normally a prerequisite for appropriations. It may place a limiton the amount of budget authority to be included in appropriations acts, or it mayauthorize the appropriation of "such sums as may be necessary." In some instances,authorizing legislation may provide authority to incur debts or to mandate payment toparticular persons or political subdivisions of the country.

BALANCES Balances of budget authority result from the fact that not all budgetauthority enacted in a fiscal year is obligated and paid out in that same year. Balancesare classified as follows:

Obligated Balance

The amount of obligations already incurred for which paymenthas not yet been made. This balance can be carried forward indefinitely until theobligations are paid in no-year appropriations, and for five years in annual funds.

Unobligated Balance The portion of budget authority that has not yet been obligated.In one-year accounts the unobligated balance expires (ceases to be available forobligation) at the end of the fiscal year. In multiple-year accounts the unobligatedbalance may be carried forward and remain available for obligation for the period


19/79

specified. In no-year accounts the unobligated balance is carried forward indefinitelyuntil (1) specifically rescinded by law, (2) the purposes for which it was provided havebeen accomplished, or (3) such time as disbursements have not been made against theappropriation for two full consecutive years.

Unexpended Balance

Amount of a fund or account that is not expended, or the sumof the obligated and unobligated balances.

BASE BUDGET The amount programmed in the budget year for conducting the sameprogram and performing the same services as are planned for the current year.Normally, the only differences between the current-year budget and the base budgetare costs that cannot be avoided or that are nonrecurring. Base adjustments arechanges made to the level of funding in the current-year budget in order to carry out thesame level of programs and services in the budget year.

BUDGET A plan for using financial and staff resources to accomplish specific goals

and objectives within a definite time period.

BUDGET ACTIVITY The highest subdivision level of an appropriation. It identifies aspecific and distinguishable category of work. Park management is an activity within theONPS appropriation.

BUDGET SUBACTIVITY The level below a budget activity in the appropriationstructure. It identifies discreet categories or functions within the larger activity. Visitorservices is a subactivity within the ONPS park management activity.

BUDGET AMENDMENT A revision to some aspect of a previous budget request,

submitted to Congress by the President before Congress completes appropriationaction.

BUDGET AUTHORITY An authorization from Congress to incur obligations, mostly inthe form of appropriations.

BUDGET CYCLE The time frame in which the annual agency budget is formulated,presented, enacted, into law, and executed. Typically, the budget cycle begins 20months prior to the start of the fiscal year for which funding is requested, and runsthrough the end of the fiscal year.

BUDGET DEFICIT

The amount by which the government's budget outlays exceed itsbudget receipts for a given fiscal year.

BUDGET ESTIMATES The document prepared for submission to the OMB that setsforth estimated funding in terms of amounts (budget authority, obligations and budgetoutlays), programs, objectives, and staffing requirements. This document focuses onchanges (increases or decreases) from the previous budget submission. The Budget


20/79

Estimate is developed prior to enactment of the previous years budget submission andis based on the budget pending before Congress.

BUDGET EXECUTION The process by which the financial resources made availableto an agency are directed and controlled toward achieving the purposes and objectives

for which the budget was approved.

BUDGET FORMULATION The process by which the resources necessary toaccomplish goals and objectives are determined and justified to decision makers (thesecretary, the President, the Congress).

BUDGET JUSTIFICATIONS A formal document prepared for submission to theCongress in support of the budgetary amounts for each agency included in thePresident's budget that sets forth estimated funding in terms of amounts (budgetauthority, obligations and budget outlays), programs, objectives, and staffingrequirements. The major components of this document include tabular statements and

budget schedules that show a comparison of levels (dollars and staffing) authorized inthe past year and current year and past accomplishments for each program of work thatidentifies the amount requested in the budget year, and its relationship to the prior fiscalyear (increase or decrease). The estimated funding is based on the final budgetallowance approved by the OMB and issued to the Department.

BUDGET PROCESS The procedure followed in the formulation, justification, andexecution of the responsibilities of a governmental entity within the legislation providedby Congress and at the direction of the President.

BUDGET SURPLUS The amount by which the government's budget receipts exceeds

its budget outlays for a given budget/fiscal year.

BUDGET UPDATES Changes or revisions in requested budget authority, estimatedoutlays, and estimated receipts for the ensuing fiscal year. The President is required bythe Congressional Budget and Impoundment Control Act of 1974 to transmit budgetupdates to Congress by April 10 and July 15 of each year.

BUDGET YEAR The fiscal year for which appropriation requests are being made tothe Secretary, OMB, and the Congress.

BUDGETING The process of translating planning and programming decisions into

specific projected financial plans for relatively short periods of time. Budgets are short-range segments of action programs adopted that set out planned accomplishments andestimate the resources to be applied for the budget periods in order to attain thoseaccomplishments.

CEILINGS The maximum limit of an item as determined by OMB or Congress.Ceilings may be established each year for employment, outlays, travel, or other objectclassifications.


21/79

CIRCULARS, OMB Permanent OMB instructions and requirements issued by OMB.These are designated by "A" and a number, such as A-11, A-34, etc. A-11 is the basicOMB instructions on the preparation and submission of annual budget estimates. A-34is the basic OMB instructions on budget execution.

COLLECTIONS

Amounts received by the federal government during the fiscal year.Collections are classified into two major categories:

Budget Receipts Collections from the public and from payments by participants incertain voluntary federal social insurance programs. These collections, also calledgovernmental receipts, consist primarily of tax receipts and social insurance premiums,but also include receipts from court fines, certain licenses, and deposits of earnings bythe Federal Reserve System. Gifts and contributions are also counted as budgetreceipts. Budget receipts are compared with total outlays in calculating the budget

surplus or deficit.

Offsetting Collections Collections from government accounts or from transactionswith the public that are of a business or market-oriented nature. They are classified intomajor categories: (a) collections credited to appropriation or fund accounts, and (b)offsetting receipts (i.e., amounts deposited in receipt accounts). In general, thedistinction between these two major categories is that the collections credited toappropriation funds accounts (category a) normally can be used without appropriationaction by Congress, as with reimbursements to the appropriation or in revolving funds.

These collections are netted against expenditures. Funds in receipt accounts (categoryb) cannot be used without being appropriated. Offsetting collections are deducted fromdisbursements in calculating total outlays. Corresponding offsets are made in arriving attotal budget authority and net obligations incurred.

COMMITMENTS Reserving or earmarking available funds for an anticipatedobligation and expenditure later; signing a DI-1 requisition with an estimated dollaramount and account to be charged "commits" the amount cited to become an obligationwhen the purchase order is issued. Commitments have been used in local fund controlsystems, such as AFS, for some time.

CONFERENCE COMMITTEE

The committee composed of members of the Houseand Senate to reconcile differences between similar legislation passed by the twohouses of Congress.

CONFERENCE REPORT The conference committee's recommendations to theHouse and the Senate for a bill reconciling the differences between the bills passed byeach house.


22/79

CONGRESSIONAL DIRECTIVE - Instructions contained within appropriations languageor in the text of any related Congressional report, that requires a formal response by theNational Park Service to the Congress. In most cases, a date is specified by which aresponse is to be provided, or a frequency is established for recurring reports (annual,quarterly, etc.) on on-going activities. Requirements vary widely, from straight-forward

summarization of available information to conducting and reporting on extensive studiesand collaborations. Directives established at any stage of the development of theappropriations bill, such as by a Subcommittee, remain in effect unless specificallydeleted or superceded by subsequent actions.

CONTINUING RESOLUTION Legislation enacted by Congress to provide budgetauthority for federal agencies (or specific activities) to continue operating until theregular appropriations are enacted. Continuing resolutions are enacted when action onappropriations has not been completed by the beginning of a fiscal year. The continuingresolution usually specifies a maximum rate at which the obligations may be incurred,based on the rate of the prior year, the President's budget request, or an appropriation

bill passed by either or both houses of Congress.

CONTRACT AUTHORIZATION A statutory authorization under which contracts orother obligations may be entered into prior to an appropriation for the payment of suchobligations.

COST ESTIMATE For construction projects, a projection for budget purposes, of thecost of construction or reconstruction or major rehabilitation of a facility. The threeclasses of cost estimates for projects, in the order obtained, are as follows:

Class C Preliminary estimates based on best information available; similar facilities atother locations and known construction cost trends.

Class B Based on data obtained during the advance planning stage; i.e.,comprehensive design, etc.

Class A

Based on working drawings and specifications.

CURRENT YEAR The fiscal year immediately preceding the budget year.

DEFERRAL Any executive branch action or inaction that delays the availability ofbudget authority for obligation. Deferrals may not extend beyond the end of the fiscalyear and may be overturned at any time by either House of Congress.


23/79

DEOBLIGATION A downward adjustment of previously recorded obligations. Thisresults from the cancellation of a project or contract, price revisions, or corrections ofestimates previously recorded as obligations.

DISBURSEMENT The amount of checks issued and/or payments made, net of

refunds received.

EXPIRED ACCOUNT An account in which authority to incur obligations has lapsedbut from which outlays may be made to pay existing obligations and liabilities previouslyincurred, as well as valid adjustments thereto.

EFFECT STATEMENT When the National Park Service does not agree with aproposed Congressional change to our budget as submitted, we appeal via an "EffectStatement," indicating the effect the change will have on the affected program and whyit should not happen.

FEDERAL FINANCIAL SYSTEM (FFS)

The NPS accounting system, an "off theshelf" system, customized for NPS use, used by bureaus of the Department of theInterior and other federal agencies.

FINANCIAL PLAN A budgetary planning document reflecting the way an organizationplans to use its financial and human resources in a given year.

FISCAL YEAR Any yearly accounting period. The fiscal year for the federalgovernment begins on October 1 and ends on September 30. It is designated by thecalendar year in which it ends.

FULL TIME EQUIVALENT (FTE)

Full-time equivalent employment is defined as thetotal number of hours worked divided by the number of compensable hours in a fiscalyear (2,087 hours). OMB controls federal employment by establishing ceilings withinwhich government agencies are expected to operate.

FUNCTIONAL CLASSIFICATIONS A system of classifying budget resources byfunction so that the budget authority and outlays of budget and off-budget federalentities, loan guarantees, and tax expenditures can be related in terms of the nationalneeds being addressed.

Budget accounts are generally placed in the single budget function (e.g., natural

resources) that best reflects its major end purpose addressed to an important nationalneed, regardless of the agency administering the program. A function may be dividedinto two or more subfunctions, depending on the complexity of the national needaddressed by that function.

FUND SOURCE Identification of a specific portion of an appropriation (fund) accountby activity, subactivity, or program element, which is established to finance the type of


24/79

work to be performed. Fund sources are aligned to specific legislation authorizationsand policies established to administer the National Park System.

FUNDING ADVICE The document (10-244) used by WASO Budget Division toformally notify regions and national centers of authorizations, increases, and decreases

to their allocations.

GRANTS Assistance awards in which substantial involvement is not anticipatedbetween the federal government and the state or local government or other recipientduring the performance of the contemplated activity. Such assistance is not limited to astate or local government as in the case of grants-in-aid. For purposes of the budget,grants-in-aid consist of budget outlays by the federal government to support state orlocal programs of governmental service to the public.

GROSS CONSTRUCTION ESTIMATE The cost estimate computed for line itemconstruction projects to be included in the budget justifications submitted to Congress.

The "gross" estimate is the "net," or projected actual cost of construction, estimate plus8% for project supervision and 10% for contingencies.

IMPOUNDMENT Any action or inaction by an officer or employee of the United StatesGovernment that precludes the obligation or expenditure of budget authority provided byCongress.

JOINT RESOLUTION A joint resolution requires the approval of both houses ofCongress and the signature of the President, just as a bill does, and has the force of lawif approved. There is no real difference between a bill and a joint resolution. The latter isgenerally used in dealing with limited matters, such as a single appropriation for a

specific purpose.

LAPSE The difference between the average number of persons actually employed infull-time permanent positions and the number of authorized positions in other words,the number of authorized positions that are vacant. This is usually expressed as apercentage. Also refers to budget authority that was not obligated before authority toobligate expired.

LIABILITY Amounts owed for items received, services rendered, expenses incurred,assets acquired, construction performed, and amounts received but not as yet earned.

LINE ITEM PROJECT

An amount specified for a particular purpose within a line itemprogram. This term would include the project-by-project listings in the construction andfederal land acquisition programs.

LUMP SUM PROGRAM An amount included in the Service's budget estimates orbudget justifications that is not identified by specific project (construction) or function(operating).


25/79

MARKThe allowance given the House or Senate in response to a budget request.

MARK-UP The process in which House and Senate appropriations committeesdetermine allowances. The allowances are written on the proposed bill, which is then"marked up."

MULTIYEAR PLANNING ESTIMATES A budget planning process designed to makesure that the long-range consequences of budget decisions are identified and reflectedin the budget totals. Currently, multiyear budget planning in the executive branchencompasses a policy review for a three-year period beginning with the budget year,plus projections for the subsequent two years.

NET CONSTRUCTION ESTIMATE A term used with line item construction projects tocall attention to the fact that the estimate is for actual construction only, and does notinclude the 18% added (making it a gross estimate) for project supervision andcontingencies. A net estimate should be used for in-house purposes only.

OBJECT CLASSIFICATION A budget classification identifying the transactions of thefederal government by the nature of the goods or services purchased (such aspersonnel compensation, equipment, supplies and materials, travel, etc.) without regardto the purpose of the programs for which they are used.

OBLIGATION-BASED BUDGETING Financial transactions involving the use of fundsare recorded in the accounts primarily when obligations are incurred, regardless ofwhen the resources acquired are to be consumed.

OBLIGATIONS Amounts of orders placed, contracts awarded, services received, and

similar transactions during a given period that will require payment during the same or afuture period. Such amounts will include outlays for which obligations had not beenpreviously recorded and will reflect adjustments for differences between obligationspreviously recorded and actual outlays to liquidate those obligations.

OPERATING FORMULATION SYSTEM (OFS) A web-based system used toformulate all programs of the NPS budget, with the exceptions of land acquisition,construction planning, and line-item construction. OFS allows field managers andcentral office personnel to develop, maintain, and access a current and completeinventory of the program needs, while at the same time providing a basis for the annualbudget formulation process.

OPERATING PROGRAM The salaries and other routine expenses of anorganizational unit needed to perform a function, provide a service, or operate andmaintain a plant, the accomplishment of which does not produce a physicalimprovement asset. Such a program would be referred to as a capital program.

OUTLAYS Payment of obligations when checks are issued or cash disbursed.Outlays during a fiscal year may be for payment of obligations incurred in prior years


26/79

(prior-year outlays) or in the same year. Outlays, therefore, flow in part fromunexpended balances of prior-year and in part from budget authority provided for theyear in which the money is spent. Total budget outlays are stated net of offsettingcollections and exclude outlays of off-budget federal entities. The terms expenditure andnet disbursement are frequently used interchangeably with the term outlays.

OVERSIGHT COMMITTEE The Congressional committee charged with generaloversight of the operation of an agency or program. In most cases, but not all, theoversight committee for an agency is also the authorizing committee for the agency'sprogram.

PACKAGE A concept used in the formulation and execution of the constructionprogram. All of the components (surveys, comprehensive design, plans andspecifications, construction, etc.) necessary to accomplish a construction project arepulled together in one package, and assigned the same package number and priority.

PASSBACK

Budgetary and programmatic guidance given to the National ParkService by the Department and to the Department and the Service by OMB in responseto proposed budget requests. The Service submits budget estimates to OMB, and OMBadvises what it will allow via a passback. The OMB passback typically occurs in lateNovember

PERIODS OF LAPSED APPROPRIATIONS When a new fiscal year begins withoutan appropriations act or a continuing resolution, a period of lapsed appropriationsexists, and agencies begin to implement contingency closedown procedures.

PERSONAL SERVICES AND BENEFITS The portion of an appropriation's object

class structure devoted exclusively to personnel costs, including benefits.

PROJECT MANAGEMENT INFORMATION SYSTEM (PMIS) A web based systemused to manage requests for project funding. PMIS allows field managers and centraloffice personnel to develop, maintain and access a current and complete inventory of allnon-recurring needs, while at the same time providing a basis for the annual budgetformation process.

PRESIDENT'S BUDGET The President's budget is a financial plan for the comingfiscal year for the entire federal government that sets forth estimated funding in terms ofamounts (budget authority, obligation and budget outlays), objectives, programs, and

staffing, and provides the basis for financing operations of the government. Thisdocument, prepared by the OMB and submitted by the first week of each January toCongress by the President, details the economic situation for a particular fiscal year interms of revenues anticipated to be available and the federal program to be financed.

The documents incorporate amounts proposed for the various independent agenciesand departments by appropriation account. The budget justification documentssubmitted to the Congress provides details in support of the total overall funding and


27/79

staffing levels included in the President's budget for each agency, office, or bureau interms of tabular statements, budget schedules, and narrative explanations of theirprograms.

PRIOR YEAR The fiscal year immediately preceding the current year.

PROGRAM COMPONENT The level below the budget subactivity in the appropriationstructure. It identifies discreet components of work within the budget subactivity.Interpretation is a program component within the visitor services budget subactivity,park management budget activity, ONPS appropriation. (Note: Components may existwhere there are no subactivities, as with Rivers and Trails under Natural Pgms, NR & P)

PROGRAM WORK ELEMENT (PWE) A three-character designation used to collectcosts by function, fund source, and cost element in the FFS. Use of a PWE ismandatory on all financial documents and time and attendance sheets. PWEs in theOperation of the National Park System (ONPS) are alpha characters. All other PWEs

are numeric.

PROGRAM Generally defined as an organized set of activities directed toward acommon purpose or goal, undertaken or proposed by an agency in order to carry out itsresponsibilities. In practice, however, the term program has many uses and is used todescribe an agency's mission, programs, functions, activities, services, projects, andprocesses.

PROGRAMMATIC CHANGES Changes in cost resulting from increases or decreasesin level of program effort. An example is the need for additional space rental and theresulting increased cost involved.

PROGRESS CHART A document issued periodically by the WASO Budget Division,to communicate within the National Park Service the progress of the Service's budgetthrough the Congressional review process. Individual increase and decrease requestsare tracked through the Congressional process, as well as program

PROJECT COST ACCOUNTING SYSTEM (PCAS) A feature of the FFS accountingsystem to collect cost and other information concerning projects. Individual increase anddecrease requests are tracked through the Congressional process, as well as amountsat the program component, subactivity, activity, and appropriation levels.

PROJECT PLANNING

The second step of the planning-design-construction program.Following the elements of advance planning, it covers the design function, includingworking drawings and specifications for the construction of or improvement to a facility.

PUBLIC LAW After signature of a bill by the President, it becomes law. The bill is sentto the National Archives where it is given a number, such as Public Law 90-206. The"90" represents the 90th Congress passing the measure; the "206" indicates that it wasthe 206th public bill passed by that Congress.


28/79

REAPPORTIONMENT A revision by OMB of a previous apportionment. Agencyrequests for reapportionment are usually submitted to OMB as soon as a change inprevious apportionment becomes necessary due to changes in amounts available,program requirements, or cost factors.

REAPPROPRIATION

Statutory authority to incur obligations and make paymentsamounting to part or all of the unobligated balance of an otherwise expired one-year ormultiple-year appropriation, whether for the same or a different purpose.

RECEIPTS Funds collected from the public and deposited in Treasury receiptaccounts as listed in Appendix D of Circular A-11. These may result from payment oftaxes, payments for services rendered, or any number of other reasons. There are twotypes of receipts:

Governmental (or Budget) Receipts

These come from the sovereign and regulatorypowers that are unique to the government. They are deposited into receipt accounts.These receipts are always reported in total (rather than as an offset to budget authorityand outlays). Budget outlays are compared with budget receipts in calculating thebudget surplus or deficit.

Proprietary Receipts Collections from the public deposited in receipt accounts of thegeneral fund, special funds, or trust funds as a result of the government's business-typeor market-oriented activities (e.g., loan repayment, interest, sale of property andproducts, charges for nonregulatory services, and rents and royalties). Such collectionsare not counted as budget receipts; with one exception, they are offset against total

budget authority and outlays by agency and by function. The exception is receipts fromrents and royalties from Outer Continental Shelf lands; these are deducted from totalbudget authority and outlays for the government as a whole rather than from any singleagency or function.

RECOVERIES OF PRIOR-YEAR OBLIGATIONS Amounts made available in no-yearand unexpired multiyear accounts through (a) downward adjustments of prior-yearobligations, including amounts returned from prior-year advances to consolidatedworking funds; (b) downward adjustments for the difference between obligationspreviously recorded and outlays made in payment thereof; and (c) refunds due to therecovery of erroneous payments or accounting adjustments.

REFUNDS Recoveries of advances and of amounts disbursed in error, which arecredited to an appropriation or fund account. These items, such as recovery of a salaryoverpayment, or return of a travel advance, will not be included as reimbursements butwill be treated as reductions of payments.

REIMBURSEMENTS Amounts earned by an agency for commodities, work, orservices furnished to an individual, firm, corporation, state, local government, or other


29/79

federal agencies for which payments are required and which may be credited to anappropriation or fund. These amounts are deducted from the total obligations incurredand outlays made in determining net obligations and net outlays for such accounts.

REPROGRAMMINGUse of funds in an appropriation account for purposes other than

those contemplated at the time of appropriation. Reprogramming is generally precededby consultation between the federal agencies, OMB, and the appropriate Congressionalcommittees. It involves formal notification to the appropriate Congressional committeesand subsequent approval by the committees.

RESCISSION Congressional action to withdraw budget authority that would otherwisebecome available or continue to be available. The Congressional Budget andImpoundment Control Act of 1974 specifies that whenever the President determinesthat all or part of any budget authority will not be needed to carry out the full objectivesor scope of programs for which the authority was provided, the President will propose toCongress that the funds be rescinded. Likewise, if all or part of any budget authority

limited to a fiscal year i.e., annual appropriations or budget authority of a multiple-year appropriation in the last year of availability is to be reserved from obligation forthe entire fiscal year, a rescission will be proposed. Budget authority may also beproposed for rescission for fiscal policy or other reasons. Generally, amounts proposedfor rescission are withheld for up to 45 legislative days while the proposals are beingconsidered by Congress.

All funds proposed for rescission, including those withheld, must be reported toCongress in a special message. If both houses have not completed action on arescission proposed by the President within 45 calendar days of continuous session,any funds being withheld must be made available for obligation.

RESTORATIONAn unobligated amount previously withdrawn by administrative actionthat is again made available for obligation and outlay.

Statutory or Contractual Aid for Other Activities -This activity provides for financialassistance in the planning, development, or operation of natural, historical, cultural, orrecreation areas that are not managed by the National Park Service. Individual Statutory

Aid is authorized specifically by law.

SUBSTANTIVE LAW Statutory public law other than appropriation law, sometimesreferred to as authorizing legislation. Substantive law, usually couched in broad generalterms, authorizes the Executive Branch to carry out a program of work. Annualdetermination of the amount of the work to be done, expressed in specific dollaramounts, is usually embodied in appropriation law.

SUPPLEMENTAL APPROPRIATION An act appropriating additional funds for thecurrent year after enactment of the regular appropriation. Supplemental appropriationsprovide additional budget authority beyond the original estimates when the need forfunds is too urgent to be postponed until the next regular appropriation bill.


30/79

Supplementals may sometimes include items not appropriated in the regular bills forlack of timely authorizations.

TRANSFERS When specifically authorized in law, all or part of the budget authority inone account may be transferred to another account. Depending on the nature of the

transfer, these charges and credits will be treated as either expenditure transfers ornonexpenditure transfers.

TRUST FUND A fund credited with receipts that are earmarked by law and held intrust or in a fiduciary capacity by the government for use in carrying out specificpurposes and programs in accordance with an agreement or a statute.

Uncontrollable Changes Changes in cost resulting from outside forces that do notrepresent changes in program effort levels. Examples are rate changes in space rentalresulting from inflation and cost of living pay increases.

UNDELIVERED ORDERS

The value of goods and services ordered and obligated,but which have not been received or paid for. This amount includes any orders for whichadvance payment has been made but for which delivery or performance has not yetoccurred. This term is synonymous with unliquidated obligations.

VETO The President's refusal to sign legislation approved by the Congress. TheCongress may override a veto by a two-thirds vote of each house.

WARRANTS The official documents issued pursuant to law by the secretary of thetreasury that establish the amount of money authorized to be withdrawn from theTreasury.


31/79

Glossary

a

b

c

d

e

f

g

h

i

j

k

l

m

n

o p

q

r

s

t

u

v

w

x

y

z

ABAC

Accrual based accounting. In 2006, the Commission produced the first set of accrual based accounts

which recognise revenue when earned, rather than when collected. Expenses are recognised when

incurred rather than when paid. This contrasts with cash basis accounting that recognises transactions

and other events only when cash is received or paid.

top

accounting

The act of recording and reporting financial transactions, including the origination of the transaction, its

recognition, processing, and summarisation in the financial statements.

top
http://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ahttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ahttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#bhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#bhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#chttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#chttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#dhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#dhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ehttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ehttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#fhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#fhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ghttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ghttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#hhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#hhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ihttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ihttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#lhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#lhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#mhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#mhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ohttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ohttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#phttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#phttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#rhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#rhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#shttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#shttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#thttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#thttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#uhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#uhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#vhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#vhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#vhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#uhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#thttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#shttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#rhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#phttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ohttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#mhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#lhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ihttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#hhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ghttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#fhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#ehttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#dhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#chttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#bhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#a


32/79

accounting officer

Each Union institution appoints an accounting officer responsible for

proper implementation of payments

collection of revenue and recovery of amounts established as being receivable

preparing and presenting the accounts

keeping the accounts

laying down the accounting rules and methods and the chart of accounts

laying down and validating the accounting systems

validating systems laid down by the authorising officer to supply or justify accounting

information

treasury management.

As a general rule, the accounting officer is alone empowered to manage monies and other assets.He or she shall be responsible for their safekeeping. (afterFinancial RegulationArticle 61 OJ16.9.2002 L 248).

Where is it mentioned on this website?

Annual accounts and reports

top

accrual accounting

Accrual accounting recognizes revenue when earned, rather than when collected. Expenses arerecognized when incurred rather than when paid. This is contrasted with cash basis accountingthat recognizes transactions and other events only when cash is received or paid.


Annual reports

top
http://eur-lex.europa.eu/JOHtml.do?uri=OJ:L:2002:248:SOM:EN:HTMLhttp://eur-lex.europa.eu/JOHtml.do?uri=OJ:L:2002:248:SOM:EN:HTMLhttp://eur-lex.europa.eu/JOHtml.do?uri=OJ:L:2002:248:SOM:EN:HTMLhttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://eur-lex.europa.eu/JOHtml.do?uri=OJ:L:2002:248:SOM:EN:HTML


33/79

activity based budgeting (ABB)

Organisation of the budget appropriations and resources by purpose so as to allow people to see

what policies are pursued, and within them, what activities make up the policies, how muchmoney is spent on each of them, and how many people work on them.


Structure of the budget

top

agencies

A number of EU agencies have been established, with two main types:

executive agencies: organisations established in accordance withCouncil Regulation (EC) No

58/2003 (OJ L 11, 16.1.2003)with a view to being entrusted with certain tasks relating to the

management of one or more Community programmes. These agencies are set up for a fixed

period. Their location has to be at the seat of the European Commission (Brussels or

Luxembourg).

decentralised agencies: body governed by European public law; it is distinct from the

Community Institutions (Council, Parliament, Commission, etc.) and has its own legal

personality. It is set up in order to accomplish a very specific technical, scientific or managerialtask.


Financial regulations for agencies

top

agricultural duties

Mainly customs duties on imports of certain agricultural produce from non-EU countries

(produce covered by an EU support regime ("common organisation of the market"), as well as

levies (paid by producers) on sugar, isoglucose and inulin syrup.

http://ec.europa.eu/budget/explained/budg_system/structure/struct_en.cfmhttp://ec.europa.eu/budget/explained/budg_system/structure/struct_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:011:0001:0008:EN:PDFhttp://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:011:0001:0008:EN:PDFhttp://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:011:0001:0008:EN:PDFhttp://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:011:0001:0008:EN:PDFhttp://ec.europa.eu/budget/biblio/documents/regulations/regulations_en.cfm#agencieshttp://ec.europa.eu/budget/biblio/documents/regulations/regulations_en.cfm#agencieshttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/biblio/documents/regulations/regulations_en.cfm#agencieshttp://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:011:0001:0008:EN:PDFhttp://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2003:011:0001:0008:EN:PDFhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/budg_system/structure/struct_en.cfm


34/79

Where does the money come from?

top

amending budget

Instrument adopted during the budget year to amend aspects of the adopted budget of that year.


How is the budget decided? - The procedure in detail

Documents 2012

top

amending letter

Before the budget for the coming year is adopted, and ordinarily before Parliament's first reading

of the draft budget, the Commission may present a letter of amendment to the draft budget on the

basis of new information which was not available at the time that the draft budget was drawn up.

top

annual activity reports (AAR)

Since the 2001 budget exercise for the Commission, and since 2003 for all Communityinstitutions, the authorising officer by delegation must report to his/her institution on the

performance of his/her duties in the form of an annual activity report together with financial and

management information. This report indicates the results of the operations by reference to theobjectives set, the risks associated with these operations and the way the internal control

functions.


Annual accounts and reports

top
http://ec.europa.eu/budget/explained/budg_system/financing/fin_en.cfmhttp://ec.europa.eu/budget/explained/budg_system/financing/fin_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/management/deciding/deciding_detail/decide_detail_en.cfmhttp://ec.europa.eu/budget/explained/management/deciding/deciding_detail/decide_detail_en.cfmhttp://ec.europa.eu/budget/biblio/documents/2012/2012_en.cfmhttp://ec.europa.eu/budget/biblio/documents/2012/2012_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/reports_control/annual_rep/ann_rep_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/biblio/documents/2012/2012_en.cfmhttp://ec.europa.eu/budget/explained/management/deciding/deciding_detail/decide_detail_en.cfmhttp://ec.europa.eu/budget/explained/glossary/glossary_en.cfm#tophttp://ec.europa.eu/budget/explained/budg_system/financing/fin_en.cfm


35/79

annuality

The budgetary principle according to which expenditu