6 FAH-5 H-450
BUDGET EXECUTION
(CT:ICASS-86; 09-28-2018)
(Office of Origin: CGFS/ICASS)
6 FAH-5 H-451 ICASS Working Capital
Fund (wcf) Operating Allowance
(CT:ICASS-5; 07-21-2006)
(Applies to participating ICASS agencies)
The Working Capital Fund (WCF) is a no-year fund that
affords posts the opportunity to establish multi-year planning cycles. ICASS
managers can make long term decisions without the short-term constraints of the
annual fiscal year cycle and have greater local autonomy in determining how
resources will be allocated, including cost savings. As determined by the
ICASS council, funds not obligated at the end of the fiscal year above posts
depreciation/capitalization requirements, may be:
(1) Reprogrammed to fund infrastructure or other ICASS
needs; or
(2) Retained to reduce bills in the next fiscal year.
NOTE: The disposition of
unobligated funds must be determined collectively, not by each agency.
6 FAH-5 H-451.1 ICASS Operating
Allowance
(CT:ICASS-5; 07-21-2006)
(Applies to participating ICASS agencies)
Annual ICASS operating allowances are issued to post at
the beginning of the fiscal year upon Congressional appropriation of full-year,
Department of State funding. Operating allowances are issued by the regional
bureaus based on funding levels determined by the ICASS service center and
consists of several separate components as identified below. During the course
of the fiscal year, should the amount of one of these components change, posts
operating allowance will similarly be adjusted.
6 FAH-5 H-451.1-1 Target
Components: Regional Bureau, Lease/Living Quarters Allowance (LQA), Local
Guard Program-Nonresidential (LGP-NR)
(CT:ICASS-5; 07-21-2006)
(Applies to participating ICASS agencies)
a. ICASS operating allowances are funded at the target
levels approved for regional bureau, lease/living quarters allowance (LQA), and
local guard program-nonresidential (LGP-NR) funds.
b. Other ICASS funds which are not part of the current
year ICASS agencies invoices, are also included and separately identified in
posts ICASS operating allowance as follows.
6 FAH-5 H-451.1-2 Carryover /
Recoveries
(CT:ICASS-75; 06-20-2018)
(Applies to participating ICASS agencies)
a. Unused ICASS funds from previous fiscal years are
returned to post. These funds are not immediately available to post as funds
must be returned to headquarters for verification and reallocation to posts
current fiscal year operating allowance.
b. ICASS carryover and recovery funds are those ICASS
funds unobligated or deobligated as of September 30th for all prior fiscal year
ICASS operating allowances. For technical reasons, State-ICASS unobligated
balances are not immediately available to the post but must be withdrawn from
posts operating allowance(s) and returned to post the next fiscal year, after
reconciliation of the year-end obligated balances, and reapportionment by the
Office of Management and Budget (OMB). Once the amounts are verified by the
Bureau of Budget and Planning (BP) as available in the Departments accounting
system, the funds will be returned to post as an increase to posts current
year ICASS operating allowance. Unobligated balances are returned intact to
the originating posts and are separately identified in the operating allowance
allocations.
c. Recoveries will be manually redistributed
throughout the year as they are earned. As recoveries are generated they will
be redistributed to post provided that the recoveries have been apportioned by
OMB.
d. Post ICASS council and the service provider should
develop a plan for the use of any carryover/recovery funds which should take
into consideration ICASS assets to be replaced or purchased, asset replacement
cycles, country-specific conditions that affect them, and investments in
innovation and improvement of ICASS business practices (which could include
information technology applications or Foreign Service national (FSN)
training). If carryover/recovery funds exceed posts total
capital/infrastructure requirements, the ICASS council can determine to use
these funds for any authorized/approved budget purposes including the reduction
of ICASS bills for all agencies. Carryover/recovery funds should not be used
for ongoing, recurring expenses where the use of these funds commits post to
expenses in future years.
e. ICASS carryover/recovered funds reallotted to post
are fenced into the three categories where funds are provided: Regional
bureau, nonresidential local guard program, and OBO lease funding. For
example: Carryover/recovered funds reallotted as a result of savings or
deobligations from nonresidential local guard program funds are available only
for nonresidential local guard program expenses. This funding can only be used
to meet nonresidential local guard program requirements. The same applies for
regional bureau expenses and OBO leases.
f. Negative carryover and recovery amounts will be
corrected by withdrawing funds from posts current year ICASS operating allowance.
6 FAH-5 H-451.1-3 Contingency
Funds
(CT:ICASS-75; 06-20-2018)
(Applies to participating ICASS agencies)
a. Posts requests for contingency funds, once approved
by the ISC, will be allotted to post and separately identified in posts ICASS
operating allowance. Contingency funds are funds provided above posts target
levels and as such are not automatically included in next years target levels.
b. Every effort should be made to ensure that all
anticipated, mandatory funding requirements are included in posts initial
budget submission. However, it is possible that unanticipated needs will arise
after the final target levels have been set for the fiscal year. If other
funds cannot be reprogrammed from within posts ICASS allotment to meet the
unbudgeted and unanticipated funding requirement, the only mechanism by which
post may obtain additional resources is through the ICASS contingency fund.
ICASS contingency funds are repaid in the next fiscal year at the headquarters
level. Contingency funds should not be requested for recurring expenses other
than wages.
c. Contingency fund requests should be submitted via
cable, directly to the appropriate bureau (regional bureau, Bureau of
Diplomatic Security (DS), or Bureau of Overseas Buildings Operations (OBO)) for
evaluation and approval. The responsible bureau will forward recommended
contingency requests to the ICASS service center for processing. Contingency
funding requests must meet the following criteria:
(1) The needs should be unbudgeted and unanticipated;
(2) The post should explore other avenues to meet the
requirement within the available ICASS resources at post (to include proceeds
of sale, carryover, and recovered funds). Carryover/recovered funding
considered to meet unanticipated expenses depends on the category of the
request. Carryover/recovered funding is fenced based on the following three
categories: regional bureau, nonresidential local guard program, and OBO
leases. (See 6 FAH-5
H-451.1-2 Carryover/Recoveries for more detail on how carryover and
recovered funds can be used); and
(3) The post ICASS council should concur on the
request.
d. The post must cable the appropriate bureau,
explaining the need, identifying the costs, and indicating ICASS councils
concurrence of the request.
e. Contingency fund requests for nonmandatory wage
increases are closely reviewed as these increases impact the annual funding
level for post and the use of contingency funds for these increases may be seen
as a way to circumvent the target setting process. Post should therefore make
every effort to budget for anticipated wage/benefit increases in the initial
budget or should notify the regional bureau should an increase become known
before the ICASS final target has been set. Posts submitting a contingency
fund request for nonmandatory wage increases must provide the following
additional information:
(1) Percentage of the post-approved Locally Employed
Staff (LE staff) wage increase;
(2) Percentage of FSN/PSC/PSA wage increase recommend
by the Office of Overseas Employment (HR/OE) survey;
(3) Effective date of the increase;
(4) Amount of funds budgeted (available) for this
increase (dollar amount) within posts current ICASS operating allowance;
(5) Additional ICASS funds required (dollar amount);
(6) Additional (annualized) ICASS costs for wage
increase next fiscal year (dollar amount);
(7) Brief narrative justification for the wage
increase; and
(8) Identify any recruitment/retention problems with
existing wages.
f. Repayment charges for posts utilizing/receiving
ICASS contingency funds will appear on the initial invoices at the Washington level in the next fiscal year. Agencies present at post during the fiscal year
in which the contingency funds are billed will be responsible for repayment of
those funds based upon their share of the total ICASS post budget.
6 FAH-5 H-451.1-4 Partial-Year
Invoices
(CT:ICASS-15; 11-06-2009)
(Applies to participating ICASS agencies)
See 6 FAH-5 H-392
Partial Year Invoice Module for updated guidance.
6 FAH-5 H-451.1-5 Temporary-Duty
(TDY) Module Invoice
(CT:ICASS-15; 11-06-2009)
(Applies to participating ICASS agencies)
See 6 FAH-5 H-360
Temporary Duty Personnel and ICASS for updated guidance.
6 FAH-5 H-451.1-6 ICASS Exchange
Rate Gains and Losses
(CT:ICASS-37; 07-02-2013)
(Applies to participating ICASS agencies)
Local economic conditions including exchange rates, affect
the buying power of ICASS funds. In budget formulation and execution, the goal
of the exchange rate gain and loss policy is to maintain for the post the same
buying power as originally budgeted. Gains and losses of the local currencys
buying power are calculated in the Bureau of Budget and Planning (BP) through
the Department of States Exchange Rate Impactor System. That system computes
monthly local currency exchange rate gains and losses based on actual local
currency liquidations processed through the Departments accounting system.
The system calculates the percentage of posts target budget paid in local
currency; the monthly gain or loss in local currency; and also uses the most
recent month-end local currency rate to project the funding effect of the
current rate on the remaining unliquidated balance of funds within posts
target. Gains and losses are calculated on an annual basis; however, to
facilitate the budget process, the system separately identifies annual gains
and losses into two columns:
(1) The current fiscal year gains and losses; and
(2) The annualized amount of those gains and losses
into the next fiscal year.
Detailed information on the calculation of exchange rate
gains/losses can be received by contacting the ICASS service center.
6 FAH-5 H-451.1-7 Operating
Allowance Adjustments for Local Currency Gains/Losses
(CT:ICASS-37; 07-02-2013)
(Applies to participating ICASS agencies)
Targets are not adjusted during the fiscal year; however,
the buying power is maintained by increasing a posts operating allowance to
make up for exchange rate losses and withdrawing funds generated by exchange
rate gains. Twice each year, current year exchange rate gains and losses are
calculated by the Bureau of Budget and Planning (BP) exchange rate system and
those calculations are the basis for the exchange rate adjustment to a posts
current year ICASS operating allowance. The first annual exchange rate
adjustment is based on local currency exchange rates and post liquidations
through March 31. A second adjustment occurs based on June 30th local currency
exchange rate and liquidation information. The June 30th adjustment is the net
funding adjustment for exchange rate gains and losses that occurred between
March 31 and June 30.
6 FAH-5 H-451.1-8 Target
Adjustments for Exchange Rates
(CT:ICASS-37; 07-02-2013)
(Applies to participating ICASS agencies)
a. For uniformity, the exchange rate (budget rate)
used by posts in preparing the ICASS budget and for monitoring exchange rate
gains and losses is as of October 1st of each fiscal year. This budget rate
remains unchanged throughout the fiscal year despite fluctuations in the local
currency. Initial and final ICASS invoices for all agencies are thus prepared
using the exchange rate as of October 1. Since the budget exchange rate
remains as of the rate of exchange on October 1st, targets
are not adjusted during the fiscal year for exchange rate changes. Targets are
only adjusted in the initial target setting process to compensate posts for
changes that occurred in the rate of exchange since the previous budget rate
(the previous October 1).
b. Initial target levels for the coming fiscal year
must be finalized prior to September 30th. These targets are developed using
data from the Bureau of Budget and Planning (BP) exchange rate system as of
June 30th. Initial targets must therefore be adjusted after the end of the
fiscal year for changes in the local currency rates that occurred from June
30th to September 30th. When year-end exchange rate data becomes available,
the ICASS service center (ISC) revises posts targets for net prior-year and
annualized changes that have occurred in the local currency buying power.
Revised initial targets are issued by the ISC to posts for use in the initial
budget submission.
6 FAH-5 H-451.1-9 The Exchange
Rate Set-Aside Fund
(CT:ICASS-5; 07-21-2006)
(Applies to participating ICASS agencies)
a. The Exchange Rate Set-Aside Fund was established
within the ICASS Working Capital Fund (WCF) as a depository for net overall
gains experienced at posts abroad during the initial years of ICASS.
Current-year exchange rate operating allowance adjustments either accrue to, or
are funded from, the Exchange Rate Set-Aside Fund. When the total exchange
rate gains deposited into the Exchange Rate Set-Aside Fund exceed the
anticipated potential needs of the fund, as determined by the ICASS budget
committee, the committee will dispose of those funds in one of the following
ways:
(1) Funds will be returned to posts for infrastructure
or other ICASS needs;
(2) Funds will be used for Washington ICASS funding
needs;
(3) Funds will be returned to paying agencies in the
form of reduced ICASS billings.
b. If losses against the U.S. dollar are such that the
set-aside fund falls below the level established by the budget committee for
covering anticipated losses, the committee will make a recommendation to the
working group regarding replenishment of the set-aside fund by customer
agencies. Such replenishment may take the form of special billings to bring
the set-aside fund up to the required level. In a period of protracted
weakness of the dollar, set-aside fund replenishment may be planned at the
start of the year.
6 FAH-5 H-451.1-10 Hyperinflation
Designation for Posts
(CT:ICASS-37; 07-02-2013)
(Applies to participating ICASS agencies)
Posts where inflation exceeds ten percent of the local
currency base in a fiscal year may be designated as a hyperinflation post for
the purpose of exchange rate adjustments. Hyperinflation designations are
reviewed annually by the Bureau of Budget and Planning (BP) using worldwide
economic forecasts. Hyperinflation-designated posts may retain exchange rate
gains that occur during the fiscal year to offset anticipated wage and price
increases (gains in excess of inflation will be withdrawn). At the same time,
operating allowances are increased for exchange-rate losses that occur during
the year. Posts that are not designated as hyperinflationary but that are
experiencing inflation in excess of ten percent should contact their regional
bureau to request a review of their status.
6 FAH-5 H-451.1-11 Disposal and
Proceeds of Sale
(CT:ICASS-5; 07-21-2006)
(Applies to participating ICASS agencies)
a. Each year the Department sells personal property
abroad because the property items are at the end of their useful life, damaged
beyond economical repair, or are no longer needed. ICASS property must be
disposed of at the post.
b. The proceeds of sale are the resources of ICASS and
will be deposited in the Working Capital Fund (WCF). It is ICASS policy to
return the proceeds of sale to the post that disposed of the property (see 6 FAH-5
Exhibit H-451.1, Collection of Proceeds of Sale).
6 FAH-5 H-451.1-12 Obligation
of Funds
(CT:ICASS-86; 09-28-2018)
(Applies to participating ICASS agencies)
a. To ensure the transparency of the ICASS system,
budgeted funds must be used according to its intended purpose. When funds are
obligated and liquidated under ICASS, it is therefore important that a post
obligate funds to each cost center or cost pool (in the function code field of
the obligation) as costs were budgeted in the ICASS software. Cost pools
represent an obligating tool and were developed to assist post in obligating
funds in specific areas where costs are normally budgeted to more than one cost
center (i.e., American direct-hire (DH) position costs, locally employed staff
(LE staff) funds, etc.). The ICASS software has the capability to load actual
post quarterly financial services center (FSC) obligations and distribute this
information in the ICASS budget to ensure that funds are obligated in
accordance with the ICASS council approved budget plan. The Budget vs. Actuals
by Cost Center report should be provided to the ICASS council quarterly.
b. While service providers have flexibility to spend
ICASS resources as required, significant discrepancies in the budget versus the
actual obligation of funds should be explained to a posts ICASS council.
6 FAH-5 H-451.1-13 Cost
Pools
(CT:ICASS-86; 09-28-2018)
(Applies to participating ICASS agencies)
See 6 FAH-5 H-314
Budgeting ICASS Costs for updated guidance.
6 FAH-5 H-452 through h-459 unassigned
6 FAH-5 Exhibit H-451.1
Proceeds of Sale for the Department of State
(CT:ICASS-86; 09-28-2018)
(Applies to participating ICASS agencies)
a. This exhibit sets forth the procedures for recording
and depositing proceeds of sales of ICASS personal property at post. Only
personal property items that were transferred to ICASS (e.g., former FAAS
property) or purchased with ICASS funds are covered by this section. All ICASS
personal property including furniture, equipment, supplies, appliances,
machinery, and vehicles not centrally funded and controlled, is covered.
b. Since ICASS is a component of the Working Capital
Fund (WCF), which has no-year status, this exhibit has been prepared
independently of the guidance for the proceeds of sale for other types of
property, under either single or multi-year appropriations. Guidance dealing
with the proceeds of sale of other non-ICASS personal property will be issued
separately.
c. The procedures in this exhibit must be implemented
by the post and the Bureau of Budget and Planning (BP) to ensure accurate,
timely recording, and allocation of proceeds.
Legislative Background
a. ICASS, as part of the Department of States WCF, is
subject to the Departments WCF legislation. Public Law 88-205, dated December
16, 1963, established the Departments WCF and states that the fund shall be
available without fiscal year limitations. It further states that The fund
shall also be credited with other receipts from sales or exchange of property...
The legislative language contains no limitations or restrictions constraining
the use of the collected receipts from the proceeds of the sale or exchange of
property.
b. Since the WCF operates as a no-year business-like
entity, the proceeds can be used as management deems appropriate. Posts are
not to follow the standard proceeds of sale calendar (July 1―June 30)
used for program or ICASS property. Since ICASS is a no-year fund operating
within the Basic Authorities for the working capital fund, the proceeds are
available indefinitely. It is ICASS policy to return the proceeds of sale to
the post that disposed of the property.
Post Operations
a. Collection and deposit of ICASS proceeds of sale
will be handled in accordance with current procedures with the exception of
coding changes which are described below. These coding changes affect all
posts serviced by Global Financial Services Center and Bangkok. Posts should
consult with their servicing financial services center/financial management
center (FSC/FMC) with any questions regarding these instructions.
b. The cashier will require the following information
to complete the strip code for Form OF-158, General Receipt. This example
represents the first ICASS proceeds of sale from Caracas (Post 140) in FY2005:
19X45190001 9906 ICAS514001
9671 AAAC
A B C D E
A The fund symbol to be used
by ICASS is 19X45190001. The last four digits (0001), with or without a
period, are critical to identifying the proceeds of sale as belonging to ICASS.
B All ICASS personal property
proceeds of sale will use 9906 in the Expenditure Authority/Allotment Field.
This is a domestically controlled revenue reporting code. This code identifies
the transaction as an ICASS Overseas Revenue Collection.
C The obligation number is
reported in a ten-digit field. In order to ensure that the proceeds of sale
information is recorded correctly, the post will create the obligation number.
All ICASS obligations will conform to the following format:
I C A S Y P P P N N
ICAS - ICAS will be used
in the first four positions.
Y - The fifth digit is the
last digit of the current fiscal year.
PPP - The sixth, seventh,
and eighth digit of the obligation number represents the post code.
NN - The ninth and tenth
digits will be serially numbered and will identify the number of sales of
property to date for that post for that fiscal year.
D All ICASS personal property
proceeds of sale will use function code 9671. This code, titled ICASS
Collections, is used for ICASS proceeds of sale only. For non-ICASS proceeds
of sale, posts will continue to use the existing procedures for recording the
sale.
E Generally AAAC (see
description below) will be the Revenue Source Code (RSC) used in this field.
RSCs are entered in the same field as the budget object code and there are
currently five RSCs that could be used by ICASS.
AAAA―Proceeds of Sale, passenger vehicles
AAAB―Proceeds of Sale, nonpassenger vehicles
AAAC―Proceeds of Sale, all other personal property
AAAZ―Proceeds of Sale, capital assets, not vehicles
ABBA―Other ICASS Collections
c. Any assets with an original cost of $25,000 or more
must use the AAAZ RSC. Vehicles (irrespective of original cost) are the
exception to this rule and will be coded as appropriate to either the AAAA or
AAAB RSC.
d. For sales of ICASS vehicles and other ICASS
capitalized assets, the post must ensure the ICASS budget software is updated
to identify the asset and to include the proceeds of sale amount in the
appropriate column of the ICASS depreciation schedule in the software. The
post must also ensure that the proceeds of sale collection/deposit number for
that property is identified in the Comments section of the depreciation
schedule of the software. The information provided on the depreciation
schedule will be used by CGFS/ICASS to
reconcile capitalized asset information.
Cashier Receipt and Deposit of Proceeds
The post cashier receives the proceeds of sale for
personal property along with information identifying the accounts to be
credited. The cashier promptly prepares a Form OF-158 for the amount of the
proceeds received. To facilitate locating frequently requested information
from posts, the OF-158 for vehicle disposals should include a vehicle
description, vehicle identification number (VIN) and the purchase request
number. Accurate preparation of Form OF-158 is key to the funds being properly
credited to the post and to ICASS. Form OF-158 will be prepared as follows:
(1) Blocks 1 through 9 are prepared in accordance with
the posts Cashier User Guide;
(2) In Block 10, enter the fiscal strip as described
above; and
(3) In Block 11, enter information in narrative form
to indicate the source of the proceeds and a description of the item(s) as
provided by the general services officer (GSO) or financial management officer
(FMO). For example, Sale of ICASS property in Caracas―FF&E
(Furniture, Furnishings and Equipment).
Updating Post Financial Systems
a. Entry of collection data into the post Financial
Management System will be handled in accordance with the procedures located in
the posts Service Post Cashier Procedures.
b. Upon deposit of the proceeds of sale with the
cashier, the property will be removed from the posts Non-Expendable Property
Application system (NEPA).
c. CGFS/ICASS will
make these proceeds available for post use only after the collection
transaction has been verified. Only those amounts that have been verified are
made available for allotment to post.
Allotting Proceeds of Sale Back to Posts
a. When a sale occurs at post, the proceeds are
deposited with the post cashier who prepares a Form OF-158, General Receipt,
for the amount received. Post personnel enter collection transactions in the
post financial system and transmit them to the Bureau
of the Comptroller and Global Financial Services (CGFS). These
transactions are then transmitted twice weekly to the Department. Each sale
transaction is summarized by post on a monthly report of proceeds transactions
for the fiscal year. CGFS Charleston confirms that proceeds deposits
successfully updating the accounting records and enters each posts confirmed
proceeds total into the ICASS Allotment System (IAS). Utilizing the IAS
detail, the ICASS Service Center prepares and submits allotment recommendations
to the Bureau of Budget and Planning (BP). Only when these steps are complete
can BP issue an operating allowance to the regional bureau for reissuance to
post.
b. The purpose of the steps in paragraph a, above, is
to align the Departments status of post proceeds with that of the post. These
procedures are only used for ICASS. They are in place to quickly and
accurately reallocate ICASS funds to posts.
c. Due to the time necessary to record and process the
information, proceeds of sale will take approximately three months from date of
deposit to reallocation of funds to post. If post has not received ICASS
proceeds of sale within four months from date of deposit, post should notify
its regional bureau and provide the following information:
(1) Date of deposit;
(2) Accounting strip; and
(3) Voucher reference number and date.
The bureau will provide this information to the ICASS
service center, which will investigate the missing transaction.