FINANCIAL MANAGEMENT POLICY MANUAL

Chapter 2
APPROPRIATIONS AND FUNDS
PART A: GENERAL CONCEPTS
Section I:
TYPES AND PURPOSES OF APPROPRIATIONS AND
FUNDS
074000 GENERAL
An appropriation is the authority provided by an Act of Congress to incur
obligations for specified purposes and to make payments therefore out of the
Treasury. Appropriations are classified in several different categories based
on their purpose and length of availability. The Department of the Navy
receives appropriations which are included in the Department of Defense
Appropriations Act and in the Military Construction Appropriations Act.
These appropriations are either annual, multiple year, or no-year, as defined in
pars. 074001, 074002, and 074003. In addition to financing by means of
appropriations, certain operations of the Department of the Navy are financed
by funds such as revolving funds, management funds, and trust funds. After
the initial legislated availability for obligation purposes of an appropriation or
account is over, the account is referred to as an account no longer available.
The procedures for the administration of appropriations after the period of
availability are provided in the current issue of NAVCOMPTINST 7040.37.
(Change 61)
074001 ANNUAL APPROPRIATIONS
Annual appropriations are provided for active and Reserve military personnel
expenses as well as for operation and maintenance expenses. The
appropriations become available for obligation and expenditure at the
beginning of the fiscal year designated in the Appropriations Act. Obligations
may be incurred only during this designated fiscal year; however, the
appropriations may be used to effect authorized obligation adjustments and
payment of such obligations for 5 years after the period of availability for
incurring new obligations.
(Change 61)
074002 MULTIPLE-YEAR APPROPRIATIONS
Multi-year appropriations are provided for the procurement of investment
items including aircraft, shipbuilding, and weapons procurement. They are
Financial Management Policy
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