FINANCIAL MANAGEMENT POLICY MANUAL

military functions covered by the act. Transferred amounts will be merged
with and be made available for the same purpose and time period as the
appropriation or fund to which transferred. Transfers shall not be
authorized or requests for reprogramming made unless for higher priority
items, based on unforeseen military requirements, than those for which
originally appropriated and in no case where the item for which funds are
requested has been denied by the Congress. The Secretary of Defense
must notify the Congress promptly of all transfers. Requests for transfers
are handled as reprogramming actions as outlined in par. 073301.
6. CONTROL OF YEAR-END OBLIGATIONS.
The General Provisions of the DoD Appropriations Act contain a section
which provides that, except for certain specifically delineated programs,
not more than 20 percent of an annual appropriation shall be obligated
during the last 2 months of the fiscal year. The USD(C) applies and
monitors this restriction at the appropriation level. In addition, the
USD(C) annually implements guidance provided by the Office of
Management and Budget to control annual accounts at the end of a fiscal
year. As a general policy, operations are to be carried out in the most
effective and economical manner possible. The following general
guidelines will govern the incurrence of obligations at year-end.
Obligations for the fourth quarter of the fiscal year will not exceed
obligations for the third quarter, except where a higher level is fully
justified to carry out a seasonal requirement or an essential program
objective. Orders for supplies, materials, and equipment for the balance of
a fiscal year will be kept to the minimum required to meet approved
program needs. Purchases for inventory will be managed so that
inventories are maintained at no higher than normal levels. Generally, it
would be expected that the number of weeks of inventory supply at the
end of the year would not exceed the average end-of-month inventory for
the first three quarters of a fiscal year. Additional purchase orders and
contracts for goods or services (for delivery extending into the next fiscal
year) may be entered into in cases that provide a comparative cost
advantage to the Government. Employment will be held to the minimum
necessary to accomplish the job.
(Change 64)
PART B: APPORTIONMENT
073100 GENERAL
The action required to obtain release of appropriated funds by means of the
apportionment process is the initial step in the budget execution phase.
Apportionment is defined in DODDIR 7200.1 (see Volume 2, Appendix A) as
"a determination by the Director of the Office of Management and Budget as
to the amount of obligations which may be incurred during a specified period
Financial Management Policy
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