U.S. Government Standard General Ledger Board and Issues Resolution Committee Meeting Minutes
October 31, 2002
Judy Yuran (FMS) opened the meeting and introductions were made. Judy indicated that Christine Chang (FMS) worked with Karen Stewart (FMS)in developing transactions for foreign currency and has developed a scenario that would be presented during the meeting. Additionally, she indicated that she would be presenting the new Treasury Financial Manual (TFM) guidance on Cash Held and Investment Held Outside of Treasury.
HANDOUTS:
Foreign Currency Flowchart
Proposed Accounting Transactions for X7000 Series Account Symbols Scenario
Proposed Accounting Transactions for Purchased Foreign Currency Scenario
Treasury Financial Manual – Accounting for and Reporting on Cash and Investments Held Outside of the U.S. Treasury, Part 2 – Chapter 3400
Cash and Investments Activities Outside of the U.S. Treasury – Statement of Transactions/Accountability Reporting document
AGENDA ITEMS:
Foreign Currency Flowchart
Christine reviewed the flowchart and provided an overview of the flow of foreign currency. She explained that the USDO’s (State Department) operating foreign currency balance comes from two sources. One source is from the X7000 account, formerly known as the Foreign Transaction account, which was established to report foreign currencies acquired without the expenditure of U.S. dollars. For example, foreign currency donated by foreign governments (Peace Corps’ X7000 account). The other source is from the purchase of foreign currency by the USDO.
She explained that agencies that need to disburse money oversees will send a voucher with their fiscal data to USDO requesting disbursement of foreign currency. The USDO will make the disbursement using their operating balance of foreign currency. At the time of the disbursement, the USDO will charge the requesting agency’s appropriation symbol, which will reduce their fund balance with Treasury. The requesting agency should not show a reduction of their fund balance with Treasury on the SF 224 because the USDO provides that information on the their SF 1218 and SF 1221 which are sent to Treasury. Lastly, the USDO provides the agency with a Voucher Auditor’s Detail Report and SF 1221.
Proposed Accounting Transactions for X7000 Series Account Symbols Scenario
Christine reviewed the scenario and noted that agencies that have an X7000 account must now report it on their financial statements. When the USDO borrows (unfunds) the foreign currency from an X7000 account, the agency with the X7000 account will record a receivable and Treasury (20x6701) will record a payable. The payable and receivable will be reduced when the USDO pays back (reclaims) the foreign currency it borrowed from the X7000 account. She stated that the subcommittee decided that transactions in the X7000 account would have an exchange rate of 1:1 and at the end of the reporting period it would be restated to the US dollar equivalent. In addition, the balances of foreign currency in X7000 accounts are generally immaterial and therefore, translations completed at each transactional level would not cost effective. As a result, it was determined that translations of foreign currency in the X7000 account would be completed at the end of the reporting period for financial statement purposes.
Proposed Accounting Transactions for Purchased Foreign Currency
Christine reviewed the next scenario, which is separated into two parts. Part I highlights transactions of an agency without disbursing authority while Part II highlights transactions of an agency with disbursing authority. No new transactions or accounts were presented in Part I. However, Christine will update the part for an error on the SF 133. Line 12, Obligated Balance, Net Beginning of Period, of the SF 133 should be $40 and Line 14, Obligated Balance, Net End of Period, should be $0.
In her review of Part II, Christine indicated that a new transaction was created for the disbursing officer to record the required foreign currency via exchange for cash check. DOD noted that they do not revalue foreign currency at the time of disbursement as indicated on pages 10 and 11 of the scenario. Christine will update the scenario to include DOD’s comments. The IRC agreed that once the updates to Part II were completed, it would not be necessary to re-present the scenarios.
Cash and Investments Held Outside of Treasury (CIHO)
Treasury and OMB want to track the amount of CIHO and of that CIHO, the portions related to cash and/or investments. FMS developed guidance (TFM, Volume 1, Part 2, Chapter 3400) that provides departments and agencies with Treasury’s accounting and reporting policies and procedures on cash not deposited in a Treasury General Account and investments in non-Federal securities. Currently, there are six agencies that are participating in a pilot for the initial implementation of procedures. All agencies with CIHO are required to report beginning January 2003.
Judy canvassed the IRC members that have CIHO and asked those agencies to share the accounting of CIHO in their agency. An open discussion was held. At the close of the discussion, she asked the members to review the Statement of Transactions/Accountability Reporting document, which includes USSGL transactions, and provide her with feedback.
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