Automated Clearing House (ACH)
The need to return an ACH entry received in the Credit Gateway may result due to errors by the sending financial institution or miscommunication between a federal entity and its remitters. In general, Nacha rules require the return of erroneous ACH transactions by the second banking day following the settlement of the original transaction. To return an ACH transaction, the federal entity must email a completed ACH Return Form to Credit Gateway Customer Care no later than 4 p.m. ET. Upon receipt, the Credit Gateway automatically returns the ACH transaction. If the ACH Return Form is received after the 4 p.m. ET cutoff, the Credit Gateway processes the request on a best-effort basis or on the next business day. For assistance with ACH returns, contact Credit Gateway Customer Care.
Erroneous Federal Entity Reporting of Deposits
Federal entities view reporting of all Credit Gateway credit/debit vouchers for their ALCs. They should report transactions identified as not belonging to the federal entity to the Credit Gateway Customer Care for return or correction. Federal entities may request a voucher correction when transactions are posted to the wrong ALC. They must submit a Gateway Account Correction Form to Credit Gateway Customer Care if the correct ALC is known (see Contacts). Both Federal entities impacted by a correction must be in agreement before the correction is submitted to the Credit Gateway. If the correct ALC is not known, the transaction must be returned, as described below.
Generally, if a remitter fails to follow payment instructions, the Credit Gateway automatically reverses (Fedwire) or returns (ACH) the transaction. Typically, the Credit Gateway does not manually correct transactions but reverses or returns transactions that do not have a valid ALC or Credit Gateway account number. The Credit Gateway may attempt to manually correct Fedwire transactions above a certain dollar threshold. Federal entities should review their Credit Gateway deposits daily for errors and promptly notify the Credit Gateway Customer Care if corrective action is required. ACH debits are not permitted to the Credit Gateway, and federal entities should advise their remitters accordingly. If a debit is received in a federal entity’s account, the Credit Gateway automatically returns it to the originating financial institution.
For more information about ACH reclamations and ACH returns please see the Green Book.
Generally, if a remitter fails to follow payment instructions, the Credit Gateway automatically reverses (Fedwire) or returns (ACH) the transaction. Typically, the Credit Gateway does not manually correct transactions but reverses or returns transactions that do not have a valid ALC or Credit Gateway account number. The Credit Gateway may attempt to manually correct Fedwire transactions above a certain dollar threshold. Federal entities should review their Credit Gateway deposits daily for errors and promptly notify the Credit Gateway Customer Care if corrective action is required. ACH debits are not permitted to the Credit Gateway, and federal entities should advise their remitters accordingly. If a debit is received in a Federal entity’s account, the Credit Gateway automatically returns it to the originating financial institution.
For more information visit TFM Volume I, Part 5, Chapter 7500
The Credit Gateway is a convenient way for federal agencies to get their money from FedWire and Automated Clearing House (ACH). A commercial bank operates the Credit Gateway by processing transactions and settling them at Federal Reserve Banks.
As collections are processed, transaction data is simultaneously sent to the Fiscal Service’s Collections Informations Repository (CIR), where you can get your agency’s information about FedWire and ACH deposits.
For more information visit Credit Gateway.
Automated Standard Application for Payments (ASAP)
Funds that have been distributed through ASAP can be returned. For information on ASAP federal entity rules, procedures, user requirements, and format, see ASAP.
Treasury Offset Program (TOP)
The Debt Collection Improvement Act of 1996 (DCIA), codified in pertinent part at 31 U.S.C. § 3716, requires federal disbursing officials to withhold all or part of federal payments made to persons who owe delinquent nontax debts in order to satisfy the debts. This process is known as “offset.” Fiscal Service has issued regulations governing offset of federal payments to collect delinquent nontax debt at 31 CFR 285.5. Authority for collecting delinquent tax debts through the continuous levy of certain federal payments can be found at 26 U.S.C. § 6331(h).
TOP matches people and businesses who owe past-due (delinquent) debts (for example, child support payments) with money that federal entitiesies are paying (for example, a tax refund). To the extent allowed by law, when a match happens, TOP withholds (offsets) money to pay the delinquent debt.
Note: Same-day ACH payment requests, are offset through the Treasury Offset Program (TOP), while Fedwire same-day payment requests are not directly offset through the TOP. However, SPS is required to determine if payees of Fedwire same-day payment requests have active delinquent debts in the TOP database. If the tax identification number (TIN) on a Fedwire payment matches a TIN with an active delinquent debt, the creation of a same-day payment is blocked. When a same-day payment is blocked and the DEO has not indicated that the payment is not eligible for offset, the federal entity should proceed to recreate the payment using a different payment type (check or ACH), which can be processed through the existing offset process.
For more information on the Treasury Offset Program visit https://fiscal.treasury.gov/top/.
International Treasury Services (ITS) and Office of Foreign Asset Control (OFAC)
- International Treasury Services (ITS)
The Bureau of the Fiscal Service provides international payment services to federal agencies allowing payments to be made in 140 currencies in more than 200 countries. Federal agencies use the International Treasury Services (ITS) web application, ITS.gov, to issue payments to recipients in foreign countries. ITS can support payments in either foreign currency or USD depending on the needs of the federal agency and supports both one-time and recurring payments, including vendor, benefit, payroll, or other payment types. Using Fiscal Service's ITS application, agencies can send payments to foreign countries in any of these ways:
As electronic U.S. dollar transfers without a corresponding U.S. financial institution
As a foreign currency check
Through Western Union
Free for Federal Agencies: There is no cost to federal agencies to use ITS.gov. The U.S. Treasury pays all transaction fees associated with processing international payments and collections.
For more information visit TFM Volume I, Part 5, Chapter 7500
- Office of Foreign Asset Control (OFAC)
The Office of Foreign Asset Control (OFAC) is a department of the U.S. Treasury that enforces economic and trade sanctions against countries and groups of individuals involved in terrorism, narcotics and other disreputable activities. For OFAC compliance, Treasury, and the FRB, are required to monitor all transactions executed by or via them to identify those that involve any entity subject to OFAC sanctions. According to the requirements of federal statutes and specific sanctions, in most cases, deposits and funds should be accepted then ‘blocked’ or ‘frozen’ to ensure funds cannot be withdrawn. In some instances transactions must instead be rejected.
For more information, please visit this site about the Office of Foreign Assets Control.
Do Not Pay
Do Not Pay (DNP) operates a resource dedicated to preventing and detecting improper payments.
DNP is authorized and governed by the Payment Integrity Information Act of 2019 (PIIA), and several Office of Management and Budget (OMB) memoranda and circulars. The authorities generally belong to OMB, which delegated the operational aspects to the Department of the Treasury.
The Working System and DNP together create one element of the larger multi-agency government-wide DNP Initiative and centrally provides a variety of data matching and data analytics services to support agency programs in their efforts to prevent and detect improper payments.
For information on Do Not Pay issue resolution, visit the Do Not Pay (DNP) site provided by Fiscal Service.
- Cancellations, Deposits, Reclamations, And Claims for Checks Drawn on The U.S. Treasury
This chapter provides information on policies, procedures, and reports regarding the processing of check reclamations and canceling U.S. Treasury checks that are State dated, undeliverable, returned, identified as not received, lost, or stolen; destroyed or mutilated, not payable (payee not entitled), and improperly negotiated.
Scope and Applicability
This chapter prescribes procedures and forms to be used for:
Automatically canceling checks drawn on the General Account of the U.S. Treasury, Processing undelivered and returned checks,
Processing claims because of non-receipt, loss, theft, destruction, or mutilation of checks, and
Processing reclamation on improperly negotiated U.S. Treasury checks
The requirements of this chapter apply to federal agencies that do their own disbursing, as well as those serviced by the Bureau of the Fiscal Service (Fiscal Service).
Governing authorities that limit the negotiability, claim ability, and reclaim ability of U.S. Treasury checks include the following:
The Competitive Equality Banking Act of 1987; Public Law 100-86, 101 Stat. 552, 657-660, signed into law on August 10, 1987, and
The Debt Collection Improvement Act of 1996 (part of the Omnibus Consolidated Rescissions and Appropriations Act of 1996); Public Law 104-134; 31 CFR 235 and 245; 31 U.S.C. 321, 3328, 3331, 3343, 3702, and 3712.
- Limited Payability Cancellation
Public Law 100-86 provides that U.S. Treasury checks must be negotiated no later than one year from the date of issuance. In addition, all checks not negotiated are canceled and the proceeds returned to the DO that authorized the issuance of the check. U.S. Treasury checks have the legend "VOID AFTER ONE YEAR" printed above the disbursing officer's signature.
Fiscal Service cancels non-negotiated checks that are 12 months old during the 14th month and returns the proceeds to the DO that authorized the payment for credit to the appropriation or fund account initially charged.
Reversal of Limited Payability Cancellations
In some cases, checks are negotiated to financial institutions within one year from the date of issuance, but processing in the FRB system prevents the payment from being applied to TCIS before the limited payability cancellation has occurred. In these instances, Fiscal Service must reverse the limited payability cancellation credit previously provided to the DO by an IPAC transaction and must provide a copy of the paid item to the DO. This transaction is separate from the monthly cancellation credit.
Checks Issued Prior to October 1, 1989
On November 30, 1990, Fiscal Service identified and canceled all checks issued and not negotiated prior to October 1, 1989. Fiscal Service applied the monies as required in Public Law 100-86, Section 1003, and did not make monies from this cancellation available to the DO.
Claims Presented to the DO for Obligations
If a payee presents a claim to a DO for the underlying obligation on a check, the DO must examine its records to see whether an earlier claim or cancellation has been processed. The DO must:
Determine if the payee is entitled, and
Identify the source account from which the funds were originally paid.
The DO may recertify a payment from the appropriation or fund from which the original payment was made (or its successor account).
- Check Cancellations
Returned, held, undeliverable, or mutilated U.S. Treasury checks in the possession of the FPA or Fiscal Service are canceled within three business days of receipt in the disbursing office. Exceptions include:
Checks recovered or returned to the possession of the FPA or Fiscal Service subsequent to the submission of a UCC,
Checks involving holder-in-due course claims,
Mutilated checks when substantial portions are missing, and
The ACC process cannot be used for NTDO issued Treasury checks. An NTDO may void a check or a range of checks, that they have on hand instead of using the ACC process (see TFM Volume I, Part 4, Chapter 6000, Section 6040).
Safekeeping of Returned Checks
ALL DOs must maintain adequate security and procedures for the safekeeping of all checks returned as undelivered while in the possession of their office pending disposition. At a minimum, they must:
Open, extract, and deface returned U.S. Treasury checks in the presence of two people,
Limit access to the area where returned U.S. Treasury checks are processed to individuals assigned the responsibility of processing returned checks, and
Secure the checks in a locked container, if there is a delay between the time the checks are received and when they are defaced.
Defacing Returned Checks
The face of each U.S. Treasury check to be canceled is defaced by stamping the legend "Not-Negotiable." The letters of the legend must be of prominent size to remove all possibility of negotiation and must be a color other than black (preferably red).
Transmitting Returned Checks to Fiscal Service
If the DO determines that the checks should be returned to Fiscal Service, it must do so no later than five business days from the date of receipt. In addition to stamping all returned checks "Not Negotiable," the DO does the following:
Marks the checks with the appropriate return reason code (Appendix 2 lists the return codes with definitions), and
Lists the checks on a transmittal.
The transmittal at a minimum must show the agency name, ALC, and the name and phone number of a point of contact. Two people must verify the transmittal before the DO sends it to Fiscal Service.
Fiscal Service should process U.S. Treasury checks returned from the DO on the day of receipt if at all possible but no later than three days following receipt.
Fiscal Service must:
Verify that all checks listed on the transmittal are received,
Sign the transmittal acknowledging receipt,
Keep a copy of the transmittal for their records, and
Return the original transmittal to the DO.
Recovered or Returned Checks
Original checks recovered or returned to the FPA, NTDO or Fiscal Service subsequent to being processed with a UCC are stamped with the legend "Not-Negotiable, Previously Treated as Canceled-SF 1184 UCC dated _______." The checks are retained for 90 days and then shredded.
Fiscal Service Check Cancellation through PACER On-Line
Fiscal Service scans all returned, undeliverable, and held checks for input to PACER On-Line. Data from mutilated checks is manually entered into PACER On-Line. PACER On-Line processes cancellations into TCIS by the overnight batch process. The credit information appears in TCIS the following business day.
Available Check Cancellation File Transmissions Returned Without Credit
During the PACER On-Line process, some ACC requests are rejected because the checks have already been paid or canceled.
Checks Returned When the Authorizing Agency Is No Longer in Operation
If the DO receives a returned check for a DO that is no longer in operation, it stamps the check "Not-Negotiable" and forwards it to the successor DO.
Accounting and Reporting Requirements for Available Check Cancellations
This section prescribes the requirements and procedures for use by FPAs to account for and report cancellation of available checks.
PACER On-Line file transmissions requesting check cancellation action are transmitted into TCIS for credit. The FPA receives credit from TCIS and passes credit via an SF 1098 (see Appendix 3) to the FPA's ALC.
Establishment of Liability for Payment of the Proceeds of Undelivered Checks Credited to Disbursing Office Accounts
A valid liability exists for the amounts of all undelivered checks credited to the DO's accounts for the possible subsequent payment to the payees or their estates upon claim for the proceeds. This liability represents an unpaid obligation. The DO may use customary documentation to establish the obligation and payability in its accounts. The DO must maintain a file on undelivered checks in order to facilitate the prompt processing of claims for the proceeds when presented by the payees or their estates.
Reporting Check Cancellations
This subsection prescribes canceled check reporting procedures for the CARS Account Statement, SF 1219, SF 1220, and SF 1221.
CARS Account Statement
The respective Fiscal Service Financial Center issuing the checks will credit the applicable deposit transactions as reductions in disbursements in the DO’s CARS Account Statement, using the appropriate Business Event Type Code (BETC), if the deposit transactions occurred within the same fiscal year. The DO must monitor its CARS Account Statement to ensure the transaction is reported to the correct TAS/BETC, and reclassify any transactions in the CARS CTA Statement, if necessary.
Standard Form (SF) 1219
Fiscal Service submits a SF 1219 reporting cancellations processed on behalf of FPAs, as a reduction to the amount of disbursements.
Standard Form (SF) 1220/SF 1221
Disbursing offices, other than Treasury, submit a SF 1220 or SF 1221 for foreign currency accounts, along with an SF 1219 or SF 1218, respectively, to report cancellations classified by appropriation, fund, or receipt account.
Non-Treasury Disbursing Office/Officer (NTDO) Rejected Deposits
Canceled checks sent to a depositary for deposit and credit to the NTDO's ALC are subject to collection (payment). If, after deposit, TCIS later rejects a check because of an existing prior check, Fiscal Service returns copies of the checks to the NTDO with an SF 5515. See TFM Volume I, Part 5, Chapter 5000.
Determining the Status of Checks
For the status of checks dated within a seven-year period, the DO may access TCIS or PACER On-Line.
See Appendix 4 for a list and explanation of the check status codes.
- Non-receipt and Non-entitlement Claims Processing
This section prescribes the forms and procedures DOs use when requesting action on unavailable checks. These procedures are used when:
The payee reports non-receipt, theft, loss, mutilation, or destruction of a check, the proceeds of which are due the payee.
The DO determines that the payee is not entitled to the proceeds of the check.
The procedures in this section do not apply to:
Lost or stolen blank check stock, see TFM Volume I, Part 4, Chapter 5000, subsection 5030.20,
Holder-in-due course claims, see subsection 7065.20,
Loss or theft of checks in transit for payment between the FRBs, or from the FRB or certain other financial institutions (see subsection 7065.10), and
Direct deposit/electronic fund transfers or Fedwire payments.
Unavailable Check Cancellation - Stop Reason/Check Status Inquiry Codes
Before processing claims from the payee/claimant, the DO must ensure the following:
The claimant is entitled to the payment.
A check was previously scheduled for issuance.
The check is not in the possession of the DO.
No cancellation or deposit action has taken place previously.
To file a non-receipt claim against a U.S. Treasury check, the DO must submit a UCC on-line through TCIS or via file transmission.
Stop Reason Code
DOs use the stop reason codes to advise Fiscal Service of information that assists in determining the adjudication process. See Appendix 1 for a list and explanation of the stop reason codes.
If the check has been paid, a FS Form 3858 (see Appendix 5) is mailed to the DO for UCC stop reason codes A, B, F, or G, and for all Payment Over Cancellation (POC) claims. For stop reason codes C and D, the FS Form 3858 is mailed to the payee/claimant.
Check Status Inquiry Code
DOs use the check status inquiry codes K and L solely for obtaining images of paid checks. The check status inquiry codes are not intended to and will not result in credits to the agencies, nor are they to be used for a claim of non-receipt. Images of paid checks can be viewed and printed from TCIS or PACER On-Line.
- Fiscal Service Processing of UCCs
Preparation of File Transmission
The DO is responsible for the accuracy of the payee's name and address. Fiscal Service will reject the UCC if any of the following information is missing or disagrees with Fiscal Service's records:
For monthly payments, the payee identification number and check date, or
For vendor and miscellaneous payments, the check issue range or schedule number.
After the DO has verified the UCC file and signed the transmittal, it transmits the file to the Fiscal Service for processing.
The signature on the file transmittal certifies the correctness of the check descriptions, other information, and authorizes Fiscal Service to process the requests.
Upon receipt of the UCC file, Fiscal Service processes the file into PACER On-Line. It consolidates all valid claims, enters them into a sequentially numbered daily UCC file, and transmits the file to TCIS.
The transmission includes the data for each payee or claimant required by Fiscal Service's file specifications. The submitting DO authorizes Fiscal Service to do the following:
Add the symbol and serial number of the check,
Consolidate the claims with other UCC submissions, and
Transmit the UCC records to PACER On-line and TCIS for further processing.
Fiscal Service notifies the DO of the disposition of each claim submitted by a return file or other media.
TCIS Rejection of UCCs
TCIS rejects UCC transmissions if the file formats are improperly prepared, incorrect, or unreadable. TCIS returns the UCC file to the DO without further processing.
If TCIS can read the UCC file but the required data for individual records are missing or inappropriate for the stop reason code selected, then TCIS issues a Daily Advice of Status (DAS) message to indicate that it has rejected the UCC item.
The DAS provides the reason for rejection and advises of the action to be taken. TCIS may generate more than one DAS rejection message for each UCC submission.
Daily Advice of Status (DAS) Message
For every accepted or rejected UCC record entered into TCIS, the DO receives a DAS.
Note: The DAS is not an accounting document.
The DAS contains the status date that indicates the date TCIS determined the status of the UCC.
Appendix 6 provides a list of status code messages and explanations.
- Accounting and Reporting Requirements
This section prescribes information on accounting and reporting requirements for the following:
Limited payability cancellation credits,
Payments over cancellations, and
Unavailable Check Cancellation (UCC) Credits
TDO UCC submissions result in credits being provided to the FPA, if the check status is "issue outstanding." Credits for TDO-issued checks are automatically posted to Fiscal Service. Fiscal Service returns the UCC credits to the TDO by an SF 1185 schedule.
TRACS transfers NTDO UCC credits to the NTDO's ALCs through IPAC. All TRACS transactions are reported to the NTDO's CARS Account Statement after they are translated to the corresponding TAS/BETC within the Shared Accounting Module (SAM). NTDO's must ensure they have completed a Cash Flow Profile within SAM for TRACS activity so that transactions can be translated with the correct TAS/BETC.
Note: TRACS automatically assigns a distinct IPAC bill number for all transactions.
Limited Payability Cancellation Credits
Treasury checks that are 12 months old and not negotiated are automatically canceled during the 14th month and the proceeds returned to the DO for credit to the appropriation or fund account initially charged. TRACS transfers Limited Payability Cancellation Credits to the DO's ALCs through IPAC.
Accounting for Canceled Checks Credited to DO Accounts
DOs return the proceeds from canceled checks to the account from which the check was originally issued. DOs with annual, multi-year, and no-year appropriation accounts treat the canceled check as an account payable. If the DO determines that the liability is not valid, the funds are available for obligation if the account has not expired.
In cases where the liability is valid, but the claim is placed after the appropriation account is closed and the balance canceled, the DO may use up to one percent of its current appropriation by reporting a 46 subclass on the Statement of Transactions or it may seek a re-appropriation.
DOs with un-invested trust, revolving, and deposit fund accounts follow the procedures in TFM Volume I, Part 6, Chapter 3000.
DOs with invested accounts retain funds from canceled checks on their books.
Payment Over Cancellation (POC) Processing
A POC results when a check previously canceled by a UCC is subsequently presented for payment. When Fiscal Service has sent a cancellation credit to the DO and the check is subsequently negotiated, Fiscal Service, via TRACS debits the DO's account through IPAC for the overpayment. Fiscal Service forwards a FS Form 3858 to the DO for completion by the payee/claimant. Upon receipt of the completed claim, Fiscal Service processes it according to the CFIF guidelines.
IPAC Bill Data File
TRACS generates an IPAC bill data file reflecting the individual payee or claimant and corresponding check information to accompany the IPAC bill. Credits and charges are listed separately and are not commingled in the same IPAC bill document or IPAC bill data file.
Agency Reporting (IPAC)
The DO uses an IPAC bill generated from TRACS for reporting. The IPAC bill and detail data are available to the DO in real-time on the IPAC website for current month transactions. The detail data remains available to the DO on the IPAC website up to 15 months after the credits and charges are transferred. The detail data must equal the total amount of the IPAC bill. The IPAC bill is documentary evidence that Fiscal Service provided credits or charges. TRACS transactions are automatically reported along with the agency’s daily IPAC transactions on an agency’s CARS Account Statement each day.
Agencies may view details of each TRACS transaction by visiting the IPAC website and querying transaction data for their Agency Location Code (ALC), or by viewing their CARS Account Statements. Throughout each accounting period, DOs must monitor their CARS Account Statements for any TRACS activity recorded. TRACS transactions will post to the TAS/BETC that agencies have requested within their Cash Flow Profiles at the Shared Accounting Module (SAM) and not to the original TAS/BETC included on the original transaction. By the end of each month, DOs must reconcile their CARS activity by TAS/BETC to their internal accounting system of record and reclassify any transactions to the correct TAS/BETC in the CARS CTA Statement, if necessary.
After reporting a credit or charge to the F3880 account on its internal accounting records, the DO must prepare a journal voucher to clear the credit or charge from the F3880 account. The funds are returned to the appropriation or fund account identified by the DO.
Throughout each accounting period, DO must monitor their journal voucher activity recorded on their CARS Account Statements. By the end of each month, federal agencies must reconcile their CARS activity by TAS/BETC to their internal accounting system of record, and reclassify any transactions in the CARS CTA Statement, if necessary.
If the journal voucher transferred a credit from the F3880 account to the DO's appropriation or fund account, the DO reports a charge to the F3880 account and a repayment (credit) to its appropriation or fund account. If the journal voucher transferred a charge from the F3880 account to the DO's appropriation or fund account, then the DO reports a credit to the F3880 account and a debit (charge) to its appropriation or fund account.
For more information on the IPAC procedures, you may also visit the Fiscal Service IPAC website.
Any credit or charge processed after TRACS closes on the last business day of the month, is accounted for in the subsequent accounting month.
Liquidating an Account Receivable
In instances where the DO re-certified a payment and established an account receivable before receiving a credit from Fiscal Service, the credit serves to offset the receivable. In cases where the DO has not re-certified a payment and established an account receivable before receiving credit from Fiscal Service, the credit restores the amount of the original payment to the account from which it was made and from which any subsequent re-certified payment will be made.
Undisbursed Appropriation Account Ledger
The net dollar amount entered by the Fiscal Service for the F3880 account is reported on the CARS Account Statement. The ALC 20180009 is listed as the reporting entity. Subsequent statement of transaction reporting, by the DO, to clear F3880 accounts is also shown on the CARS Account Statement with the DO's ALC shown as the reporting entity. For example, when two or more ALCs within one DO's report entries for the same F3880 account, line items reflect both (or additional) ALCs reporting on the CARS Account Statement. See subsection 7050.90 regarding the F3880 account for guidance in obtaining identifying suffixes when more than one ALC is used for the same F3880 account.
To request on-line access to the CARS Account Statement, refer to the CARS website.
F3880 "Unavailable Check Cancellations and Over-payments (Suspense Account)"
The F3880 account is a budget clearing account that holds credit or charge amounts until the DO identifies the correct appropriation or fund. The DO must make every effort to maintain a minimum balance in this account by transferring all monies initially classified in this account to the proper appropriation or fund as expeditiously as possible.
Fiscal Service establishes one F3880 account for each DO. The CARS Account Statement for this account is available on-line after the Monthly Treasury Statement is published. Fiscal Service reports adjustments (ADJ)/reversals (REV) to the DO's F3880 account.
If the DO discovers that Fiscal Service has credited or charged it in error, the DO must contact the Budget Reporting Branch (see Contacts) and provide the facts of the case. It must forward copies of relevant documents, indicating that Fiscal Service must enter an adjusted credit or charge to its ALC's F3880 account. Fiscal Service verifies the information and enters the adjustment to the DO's F3880 account. Under no circumstances should a DO credit or charge any other DO to effect an adjustment.
Suffixes for the F3880 Account
The suffix is a maximum of two numeric digits; for example, F3880.10, F3880.20, etc. It is recommended that the DO:
Obtain suffixes for the F3880 account for the subdivisions that anticipate a high volume of credits or charges, and
Establish central oversight of low-volume offices.
To request pertinent identifying suffixes for the F3880 account, send a written request to the Budget Reporting Branch (see Contacts). Include the justification for each request, the address for the suffixed F3880 account, and the ALC responsible for the suffixed F3880 account.
The Budget Reporting Branch does not grant suffixes when it determines that the requests are excessive.
- Check Forgery
Processing Check Forgery Claims
Fiscal Service is responsible for authorizing the payment of settlement checks issued to replace checks paid over forged endorsements.
This section prescribes information to DOs concerning procedures for settling payee/claimant claims of non-receipt where the original check has been fraudulently negotiated.
Fiscal Service issues a reclamation to the Bank of First Deposit (BOFD) for all such claims.
Fiscal Service pays the claim out of the CFIF to a payee or special endorsee of a U.S. Treasury check the amount of the check, if Fiscal Service determines that the payee or special endorsee has established the following:
The payee or special endorsee presented a timely claim of non-receipt to the DO pursuant to 31 CFR §245.3.
The original check was lost or stolen without the fault of the payee or special endorsee, whose endorsement is necessary for further negotiation.
The original check was negotiated and paid by Fiscal Service on a forged or unauthorized endorsement of the payee's or special endorsee's name.
The payee or special endorsee has not participated in any part of the proceeds of the negotiation or payment of the original check.
Completing the FS Form 1133
After examining the check copy, if the payee/claimant denies negotiating the check, the payee/claimant must complete and sign the FS Form 1133 and must return it along with the check copy to Fiscal Service. Upon receipt of the FS Form 1133, the Philadelphia Financial Center (PFC) reviews the claim form for completeness. If the claim form is complete, PFC begins the adjudication process. To be properly completed, the payee/claimant must answer all questions on the FS Form 1133 and sign where indicated. Both payees must sign if the check is drawn to co-payees. Fiscal Service rejects claims not signed by both co-payees. If the payee/claimant signs by mark, the mark must be witnessed in the space provided for witness.
If the FS Form 1133 is not properly completed, PFC returns it to the payee/claimant with a letter advising the payee/claimant to complete the area(s) indicated and to return the FS Form 1133 to PFC. In instances where the payee admits negotiating the check or does not return the FS Form 1133, Fiscal Service takes no further action and closes the case.
Claims Adjudication Process
The adjudication process begins when the PFC, Legal Administrative Specialist (LAS) receives a properly completed FS Form 1133. The LAS sends Claims Disposition Notices (CDNs) to the DO advising of the status of received forgery claims. Several activities take place during the adjudication process.
Review of the FS Form 1133 and Supporting Documentation
The LAS reviews the FS Form 1133 for completeness and analyzes the payee's signature and other information on the FS Form 1133 and any accompanying documentation to determine the validity of the claim.
In adjudicating the claim, the LAS accesses the TCIS Integrated View to obtain additional claims information and check images to aid in the adjudication process.
If the LAS determines that the claim is valid, Fiscal Service settles the claim with the payee, DO according to the UCC stop reason code. Fiscal Service makes settlement with the DO on POC checks.
Review Check Endorsement
If the LAS determines that the endorsement on the check is similar to the signature on the FS Form 1133, the file is forwarded to the Document Analyst for handwriting analysis.
If the Document Analyst renders the opinion that the endorsement on the check does not appear to be that of the payee, the LAS then settles the claim based on the Document Analyst's opinion.
Settling the Claim
If Fiscal Service determines the payee/claimant was not involved in the negotiation of the check, from the examination of the evidence, Document Analyst's opinion or bank protest, and did not participate in the proceeds from the check, Fiscal Service settles the claim by initiating a request to issue a check to the payee/claimant or transfers the funds to the DO. Settlement is made based upon reclaiming funds from the BOFD.
Stop Reason Code A or B—If the criteria for settlement from the CFIF have been met, Fiscal Service settles with the DO since the agency has already issued a replacement check to the payee/claimant. Fiscal Service charges the CFIF and transfers credit to the DO via IPAC. The LAS sends a CDN to the DO with the message "Forgery Established - Treasury is Crediting Your Account." The LAS may request reclamation against the financial institution.
Stop Reason Code C or D—If the criteria for settlement from the CFIF have been met, Fiscal Service issues a settlement check to the payee/claimant and charges the CFIF. The LAS sends a CDN to the DO with the message "Forgery Established - A Settlement Check Is Being Issued to the Payee." The LAS requests reclamation action against the financial institution and sends a settlement letter to the payee.
Stop Reason Code E—Fiscal Service credits the DO for deceased payee checks after the reclamation credit is received from the financial institution. However, when a UCC is received on a check whose issue amount is $25 or less, and the check is paid, the DO receives a DAS Code 29 with the following message: "Paid-The Issue Amount is $25.00 or Less. No Further Action Will Be Taken." Fiscal Service has determined that it is not cost effective to reclaim on checks for $25 or less.
Stop Reason Code F or G—If forgery is substantiated, PFC requests reclamation action against the financial institution. The LAS sends a CDN to the DO with the message "Forgery Established. Claim Valid but Settlement Not Appropriate Based on Your Non-entitlement Code.
Settlement from the Check Forgery Insurance Fund (CFIF)
The CFIF is a revolving fund established to settle payee/claimant claims of non-receipt where the original check has been fraudulently negotiated. The CFIF ensures that innocent payees/claimants, whose U.S. Treasury checks are fraudulently negotiated, receive settlement checks in a timely manner. A permanent and indefinite source of funding is an integral part of the CFIF that enables Fiscal Service to meet its obligation to payees/claimants of forged checks.
Fiscal Service bars any claim on a U.S. Treasury check unless the payee/claimant presents a claim to the DO within one year from the date of issuance of the check. In addition, the DO must submit the UCC to Fiscal Service within 13 months from the issue date of the check.
Check Forgery Insurance Fund Act
The Check Forgery Insurance Fund Act does the following:
Creates a permanent and indefinite appropriation to adequately fund the CFIF. Fiscal Service uses the CFIF to ensure that recipients, whose checks have been forged and fraudulently negotiated, are promptly issued replacement checks.
Amends the conditions underlying the issuance of substitute checks under 31 U.S.C. 3331 by authorizing the Secretary of the U.S. Treasury to waive any condition for the purpose of ensuring that claimants receive timely payments.
Clarifies that the initial burden of establishing a claim for a check paid over a forged endorsement rests with the claimant, and that the Secretary has the discretion to determine whether a claimant has met this burden.
Eliminates the requirement that check replacement is contingent on whether recovery on a forgery is delayed or unsuccessful. This change is necessary to facilitate the timely issuance of replacement checks to innocent payees and to make it clear that a second payment is not contingent on the government's ability to recover on a forged item.
Ensures that certifying or authorizing agencies may provide for the expedited payment of replacement checks and that such agencies may be reimbursed out of the CFIF by a transfer of funds to the appropriated account, trust fund, or other account.
Enables the U.S. Treasury to comply with two decisions of the Comptroller General, B-24266 (August 31, 1993) and B-243536 (September 7, 1993), which concluded that the Check Forgery Insurance Fund Act (31 U.S.C. 3343) requires the U.S. Treasury to certify checks issued to replace checks paid over forged endorsements and to charge the CFIF.
If forgery is suspected, PFC takes reclamation action if the check payment date is less than 18 months old. PFC does not request reclamation for claims on checks for $25 or less. For these claims and claims received after the reclamation period has expired, settlement is made from the CFIF for UCC stop reason codes A, B, C, and D.
PFC institutes the reclamation action in TCIS, against the financial institution that presented the check for payment.
Reclamation credits are received into TRACS and automatically clear a debit in the CFIF account. If there is no debit in a CFIF account, the credits remain in the suspense account until appropriate disposition is determined.
If, from the examination of the evidence, the LAS's opinion, bank protest, Fiscal Service determines that the payee/claimant was involved in the negotiation of the check or participated in the proceeds of the check, the claim is denied. Fiscal Service notifies the DO by CDN of the denial of the claim. Any attempts by the DO to collect an overpayment from the payee/claimant are made in accordance with the Federal Claims Collection Standards (31 CFR Part 900-904).
The LAS sends the payee/claimant a letter denying the claim. The denial letter informs the payee/claimant of the reason for denial and advises the payee/claimant of the right to appeal the denial in writing.
Appeal Process for Denied Claims
An appeal is the process whereby a payee/claimant seeks review of a denied claim based upon information used by Fiscal Service in the initial decision to deny a claim, or when a claimant seeks a review of the initial denial based on new or additional information not available at the time of the initial denial.
Filing an Appeal
Claimants must file appeals in writing and must mail them to PFC (see Contacts). The payee returns a copy of the denial letter to PFC, together with a signed statement and any additional information or documentation for further investigation.
The request for an appeal must include the check and symbol number identified in the denial letter. To be considered, an appeal must be postmarked no later than 60 days following the date on the denial letter.
Determining the Appeal Decision
If it is determined that the appeal is valid, the LAS notifies the payee/claimant by letter that the appeal is valid. Settlement is processed in accordance with subsection 7055.20 (CFIF). If it is determined that the appeal is invalid, the LAS upholds the denial and sends the payee/claimant a letter advising that the appeal was denied and of the payee's/claimant's right to file a lawsuit in Federal Court. The LAS sends the DO a CDN advising of the appeal decision.
Effect of Appeal Decision
The denial of a payee/claimant appeal serves as the final action on a claim. A payee/claimant may not file a civil suit until the payee/claimant has filed an appeal with Fiscal Service and received Fiscal Service's appeal decision.
Non-receipt of the Settlement Check
If the settlement check is not received, the payee/claimant must report non-receipt of the check to Fiscal Service. Fiscal Service will initiate tracer actions to determine the status of the settlement check. If the settlement check has not been negotiated (outstanding status), the check is canceled by UCC and Fiscal Service will issue a second settlement check to the payee/claimant or may forward the funds to the DO.
If the settlement check is paid, Fiscal Service forwards the FS Form 3858 to the payee/claimant for examination. If the payee/claimant alleges forgery of the settlement check, the payee/claimant must return the completed FS Form 1133 to PFC for adjudication.
- Miscellaneous Claims
Lost-in-Transit Check Procedure
Lost-in-transit items are U.S. Treasury checks that have been negotiated and subsequently lost by a financial institution, lost or stolen between the financial institutions, or the financial institutions and the FRB.
The FRB Atlanta, Government Check Adjustment Department handles these items providing that the U.S. Treasury checks are less than one year old.
If the DO or Fiscal Service receive these requests and the checks have not been canceled and are not older than one year, they must return the requests with instructions for the financial institutions to submit them to the FRB Atlanta, Government Check Adjustment Department.
Holder-in-Due Course Claims Procedure
A holder-in-due course claim occurs when a non-banking institution negotiates a U.S. Treasury check, and the check is lost or stolen before being presented for cash or deposit at a financial institution. The claim must be submitted to the Fiscal Service for processing.
Processing Holder-in-Due Course Claims
Upon receipt of the holder-in-due course claim, Fiscal Service determines the status of the check.
If the check has been negotiated, Fiscal Service returns the claim with a copy of the check advising the holder that the check has been paid and that no further action is being taken.
If the check has not been negotiated, Fiscal Service forwards an indemnity letter to the holder for completion. When the holder returns the requested information, Fiscal Service ensures that the check is still outstanding.
If the check is still outstanding, the Fiscal Service issues a settlement check to the holder.
Handwriting Analysis of Checks Older Than One Year for Which UCCs Have Not Been Requested Timely
Fiscal Service's PFC considers handwriting identification and document examination requests on a case-by-case basis when the DO can demonstrate that it has exhausted all available means of adjudication. The requesting DO must pay any cost above the normal administrative handling per diem, such as travel for court testimony. DOs must submit requests for handwriting identification to PFC (see Contacts). PFC completes requests as time and volume dictate and forwards a reply to the requesting DO.
- Check Reclamations
Fiscal Service reclaims amounts on improperly negotiated U.S. Treasury checks, as provided for in 31 CFR Part 240.8. When Fiscal Service receives a credit that equals full principal, Fiscal Service forwards the credit to the agency, if the agency is holding the receivable.
Fiscal Service forwards partial credits received to the FPA with an indicator that the credit is partial. Fiscal Service continues collection action and forwards the balance to the FPA when received. Fiscal Service processes credits daily.
Interest, Penalty Charges, and Administrative Fees
Interest on any unpaid reclamation starts accruing on the 61st day after the reclamation date. Fiscal Service also assesses an administrative fee at that time. Fiscal Service calculates the administrative fee per the requirements of the Federal Claims Collection Standards.
Fiscal Service charges a penalty on any reclamation that remains delinquent over 90 calendar days. Fiscal Service may refer any reclamation that is unpaid for 120 calendar days after the reclamation date for administrative offset. If interest, penalty charges, and administrative fees were collected, Fiscal Service deposits those charges and fees monthly into the U.S. Treasury’s General Account 20A8183. Fiscal Service’s reports the activity for the accounts on the Statement of Transactions 224.
Fiscal Service continues collection action on check reclamations until the balance outstanding becomes $25 or less, or all collection steps have been attempted and the cost of further collection would likely exceed the amount to be recovered.
Fiscal Service does not terminate collection action if a protest or legal issue is pending resolution. Fiscal Service refunds any amount recovered on FPA receivables to the FPA.
Electronic Transmission of Partial Credits
The U.S. Department of Veterans Affairs, U.S. Railroad Retirement Board, Internal Revenue Service (IRS), and Office of Personnel Management receive their data via Connect: Direct. The indicator “CP” (Credit Partial) appears in the record layout at position 177 and 178. The summary information is transmitted to these agencies by an Intra-governmental Payment and Collection (IPAC) credit document.
Fiscal Service notifies FPAs that a reclamation was abandoned. In addition to the initial notification that a reclamation was abandoned, each month Fiscal Service reports to FPAs reclamations abandoned during the accounting month (see Appendix 7).
Reporting to the IRS on IRS Form 1099-C: Cancellation of Debt
FPAs are responsible for reporting only the principal amount of their uncollectible receivables to the IRS on IRS Form 1099-C. To assist FPAs, Fiscal Service sends the FPAs a report on the uncollected principal amount of receivables at the end of the calendar year (see Appendix 8) and again at the end of February with any modifications to the data (see Appendix 9).
Fiscal Service reports to the IRS:
The principal amount of the U.S. Treasury’s uncollectible receivables; and
Interest, penalty charges, and fees for all uncollectible receivables related to check reclamations.
- Check-Issue Reporting and Spoiled or Voided Checks
Check-Issue Reporting Methods
TCIS is the system that must be used by DOs to submit their check issue information to Treasury. DOs must also submit their disbursement related transaction information through the Payment Information Repository (PIR) to the Central Accounting Reporting System (CARS).See TFM Volume I, Part 4A, Chapter 4000 for more information on Non-Treasury Disbursing Offices (NTDO) file submissions.
Delinquent Check-Issue Reporting
Treasury requires that DOs report their check-issue data in a timely manner. Until the check-issue information is received, the TCIS will reject claims against these checks and also will not process limited payability cancellation credits. PFC cannot complete a final reconciliation and clearance of the DO's account until it receives the check-issue data. Furthermore, until the data is received, Treasury is vulnerable to banking system errors, check alterations and counterfeits, which negatively affect the government's cash position and impact the agency's ability to obtain an unqualified audit opinion with its Fund Balance with Treasury account.
PFC will notify the agency's Chief Financial Officer equivalent when delinquent check-issues have not been reported within 60 days. If habitual delinquent reporting continues, PFC may suspend the processing of further print orders for blank Treasury check stock until all delinquent check-issue reporting has been accepted into the TCIS.
If Treasury sustains a loss for an altered or counterfeit check as a result of delinquent check-issue reporting, PFC reserves the right to pursue action to charge the agency for the amount of the loss and to refuse to provide new check stock.
If a check is spoiled in the check issuance process, the DO must void the check per Section 6040 and report it per paragraph 6040.10. The DO must assign a new check number to the voided payment. Treasury no longer allows the use of control checks.
DOs void checks and render them non-negotiable by marking the face of each check with the following:
"Void - Not Negotiable. No Check
Issued Under This Number."
DOs should not send voided checks to PFC. They should dispose of voided checks per paragraph 6040.20.
If a check was reported to the TCIS as a valid check and the payee is not entitled to the check or the check is returned, the DO cannot void the check. The DO stamps the check as follows:
"Not Negotiable - For Deposit Only.
Credit of Agency Location Code ______."
A DO may deposit these checks at a Financial Institution (FI), with which they have an agreement to do so. The FI will in turn use the Over the Counter Network (OTCnet) to credit the proceeds of the check to the appropriation from which it was issued, according to check cancellation procedures. See TFM Volume 1, Part 4, Chapter 7000. A DO may also use OTCnet directly to receive this credit. Both processes will produce an SF 215 Deposit Ticket. For more information on OTCnet, see TFM Volume 1, Part 5, Chapter 2000.
Reporting Voided Check Issues
DOs report voided checks on check-issue transmittals as zero-dollar amount issues. Voided serial numbers are recorded sequentially with those of other checks issued. If DOs do not report checks as void on check-issue transmittals, PFC cannot close DO symbols when requested, see paragraph 6015.30. DOs will be held liable for any voided checks that are cashed and processed through the banking system.
Disposition of Voided Checks
DOs should destroy voided checks on site by shredding or incineration as soon as possible. (Note: Shredded fragments should be no larger than 1/4 inch in width and 3 1/2 inches in length.)
Checking Account Reconciliation Reports and Adjustments by Fiscal Service
The TCIS compares paid check data provided by Federal Reserve Banks (FRBs) with check-issue information transmittals reported by DOs on an item-for-item basis for each check serial number. When reconciling paid check data, PFC issues checking account reconciliation adjustment reports.
Report 251, Advice of Check Issue Discrepancy (5206)
Treasury adjusts (to the penny) all differences between the issue amount of a check (reported by DOs to the TCIS) and the actual amount of the check paid by Treasury. A 5206 is generated in TCIS when Fiscal Service changes the amount reported on the check-issue transmittal to agree with the actual amount printed on the check. This is done in cases where the DO has reported an issue amount to TCIS that differs from the amount printed on the check, and the check was paid for the amount printed on the check. TCIS will automatically generate a reconciliation case when this occurs. Fiscal Service sends a computer-generated copy of the 5206 to the DO to notify them of the discrepancy. The 5206 fully describes the error.
When a DO receives a 5206, the DO should immediately review its check-issue records to determine the nature of the error cited on the 5206. The DO must determine if it overpaid or underpaid the payee. It must collect or disburse the adjustment amount if it issued the check incorrectly and report the appropriate adjustments in its accounts. If the payee was not overpaid or underpaid, but the DO reported incorrect check-issue data to Fiscal Service (on its check-issue transmittal and SF 1218/1221 or SF 1219/1220), the DO still must include the 5206 on its SF 1218/1221 or SF 1219/1220.
If a DO receives a 5206 and determines that there is an offsetting check-issue error that makes the transaction net to zero, the DO should prepare a letter to PFC advising of the discrepancy. See paragraph 6050.20.
If the DO determines that the check listed on the 5206 was altered or is counterfeit, it must immediately notify PFC in writing (by express mail if possible). Untimely notification leaves the government at risk of not recovering the funds. For an altered or counterfeit check, DOs do not include 5206 adjustments on the SF 1218 or SF 1219.
See Appendix 1 for a copy of a 5206.
If the DO must adjust a check-issue error based on a 5206 from PFC, it must enter the appropriate adjustments in its accounts.
The DO must report the 5206 on its:
SF 1218 or
SF 1219 or
SF 1220: Statement of Transactions (According to Appropriations, Funds and Receipt Accounts),
SF 1221: Statement of Transactions (According to Appropriations, Funds and Receipt Accounts - Foreign Service Account).
This supports the adjusting entry on SF 1218/1219, line 2.11, "checks issued/adjustments- 5206," or SF 1220/1221.
On a monthly basis, the DO must provide a list of all 5206s to its agency headquarters. It must explain how the error occurred. The DO also must describe the internal control measures it has initiated to prevent further errors.
Adjustment of Duplicate Checks
The TCIS accepts only one issue/paid record for any given check symbol and serial number. Therefore, PFC uses SF 5515: Debit Voucher, to charge the DO for duplicate checks issued with the same symbol and serial number.
Reversal of SF 5515 for Duplicate Checks
If a DO issues a check with the wrong check symbol and serial number to a payee that is entitled to a payment and this causes a duplicate check, the DO must request that PFC reverse the SF 5515 in writing. The letter must identify the correct symbol and serial number of the duplicate check. DOs also must provide a copy of the SF 5515 to PFC. After PFC verifies the information, it processes a reversal entry and issues an SF 215 to the DO.
In addition, the DO must report the appropriate check-issue information to the TCIS for the correct symbol and serial number of the duplicate check. PFC will not reverse SF 5515s unless the DO reports, and the TCIS accepts, the check-issue information for the correct symbol and serial number of the duplicate check.
Adjustment of Deposit Differences
The Statement of Difference (SOD) identifies differences between the amounts reported as deposited in the Treasury General Account (TGA) and the amounts actually credited to the TGA. The SOD for deposits are generated on a monthly basis and are available via the CARS SOD application. The Deposit Ticket/Debit Voucher Support Listing is also available in CARS SOD and is updated daily.
- Check-Issue Adjustments Guidelines for Disbursing Offices
Check-Issue Adjustments by Disbursing Officers
DOs follow the procedures in this section to show proper accountability for funds when processing adjustments in their accounts. These adjustments relate to checks drawn on the TGA.
DOs prepare a journal voucher for any prior month or the current month check-issue errors they detect (see paragraph 6050.20). However, DOs cannot send journal vouchers or letters requesting adjustments for check-issue errors detected more than one year from the issue month of the check. By that time, the TCIS has canceled the checks. It passes the credit to the Treasury Receivable Accounting and Collection System (TRACS), which returns the funds to the agency through the limited payability cancellation process. TRACS will send the payment back to the ALC and the TAS/BETC that is specified in the federal agency’s Cash Flow Profile within the Shared Accounting Module (SAM); TRACS will not send the payment back to the TAS/BETC reported on the original payment. DOs correct check-issue discrepancies more than one year from the issue month of the check depending on how they received the limited payability cancellation credits. DOs must correct these discrepancies in one of two ways:
If received through the Intra-Governmental Payment and Collection (IPAC) System, the DO reports the credit in Section I, Part A, of the SF 1220. The DO also records it on line 2.80 of the SF 1219. Then, it records and reports a journal voucher for the check amount on lines 2.12 and 4.10 of the SF 1219. It also charges the account credited from the IPAC documents or SF 1220.
If received on a SF 1081: Voucher and Schedule of Withdrawals and Credits, the DO records the SF 1081 to its accounts. Then, the DO records and reports a journal voucher for the check amount on lines 2.12 and 4.10 of the SF 1218/1219. It also charges the account credited from the SF 1081 on the SF 1220/1221.
For further help on processing check-issue errors detected more than one year from the issue month of the check, contact the Cash Accounting Branch. See Contacts.
For check-issue errors detected by the DO within 12 months from the issue month of the check, the DO must prepare the journal voucher (reported on the SF 1218/1219) as soon as it determines the facts. Also, the DO must write a letter to PFC describing the same error(s) on the journal voucher. It should not wait to receive a 5206. PFC uses the information in these letters to correct reporting to the TCIS. For each specific check symbol and serial number adjusted, the TCIS generates report 252, Notification of Check Issue Correction-Disbursing Office Requested. PFC forwards this report to the DO. See Appendix 2.
Error in Issue Amount
DOs must correct a prior month's discrepancy that occurred because:
The DO drew a check for an amount different from the amount taken into its account, and
The DO reported that check amount on the check-issue transmittal.
To adjust the issues to agree with the amount of checks as drawn, the DO must submit a journal voucher or appropriate correspondence to PFC. In addition, the DO does the following:
Collects the overdraft amount related to the receivable established for the adjustment, or
Issues a new check (new issue) for an underdraft, related to the deposit fund credit established for the adjustment; and, if applicable,
Adjusts the account charged for the related disbursement.
If the DO receives a 5206 that cites the same error, the DO should file the 5206 with its office copy of the journal voucher and take no other action since the DO has already corrected the error.
Error in Disbursement
If the amount of the check, the amount on the issue transmittal, and the amount in the accounts are consistent but the "amount to be paid" on the internal voucher is different, the DO should not send a journal voucher to Fiscal Service. It should adjust the amount on its books.
Distribution of the Journal Voucher
The DO distributes the journal voucher and two copies as follows:
- Original. Keep the original to support the accounts receivable account on the SF 1218/1219 and to support the accounts payable account on the SF 1220/1221, __X6999. The journal voucher must include the check symbol, serial number, and the issue date of the check. Also, the journal voucher must explain the circumstances that caused the adjustment. For example, a DO issued a check to a payee for $359 but reported a voucher and check-issue to Treasury on the issue transmittal of $659. In this case, the journal voucher would show a credit of $300 to the accounts payable account.
- Copy 1. Retain the first copy and attach it to the clearance transaction document (for example, SF 215, schedule of collection, payment voucher or SF 1081). Report the transaction document to support the SF 1218/1219 or SF 1220/1221 when the item is cleared from the receivable account or the payable account.
- Copy 2. Keep the second copy as the subsidiary record of uncleared differences comprising the balance of accounts receivable or accounts payable, and the current operating control record for the corrective actions.
Accounting for Check-Issue Overdrafts and Underdrafts
As part of the DO's accountability, each DO establishes an "Accounts Receivable, Check-Issue Overdrafts" account. Treasury has designated deposit fund account __X6999, "Accounts Payable, Check-Issue Underdrafts" (with the symbol prefix of the disbursing agency) to record check-issue underdrafts.
Accounting for Collections and Payments Made to Clear Outstanding Differences
To clear outstanding overdrafts and underdrafts, as appropriate, DOs must do the following:
- Clear Accounts Receivable. Deposit cash collections received to clear the amount of overdrafts held in accounts receivable for credit in the TGA. Credit the amount of collections to the accounts receivable account. If an undercharge to an appropriation or fund account caused the overdraft and if a supplementary certified voucher charging the appropriation or fund account will clear the overdraft, credit the voucher amount to the accounts receivable account;
- Clear Accounts Payable. After determining that a payee is entitled to the amount of a check issuance underdraft, certify a disbursement voucher to charge the deposit fund account __X6999. Record the voucher and check issued in the DO's account. Report the voucher and check issued on SF 1219.
- Clear Subsidiary Account Files. Based on the clearance actions described above, pull the file copy of the journal voucher (paragraph 6050.50) and annotate it with one of the cross-references shown below, as appropriate:
If an overcharge to an appropriation or fund account caused an underdraft, certify a SF 1081 or a comparable approved voucher adjustment form to charge the deposit fund account __X6999. Credit the appropriation or fund account involved. Provide a copy of the adjustment form to the administrative agency or office whose accounts are affected; and
"See Deposit Ticket No. ___, dated ___."
"See Check No. ___, dated ___."
"See Adjustment Voucher No. ___, dated ___."
See Distribution of the Journal Voucher for instructions on handling copies one and two of the journal voucher.
Federal Financial Management Standards
- Functions and Activities
Payment Confirmation and Issue Resolution (FFM.030.120)
Record disbursement status, confirmation, and identification information;
Provide disbursement status, confirmation, and identification information
- Federal Financial Management System Requirements (FFMSR)
Making payments (2.2.2)
Capture federal government unique invoice prompt payment information (for example, invoice receipt date, discount, applicable interest rate determined per government formula, and accelerated payment) to support payment of invoices as specified in the CFR
Determine disbursement terms and amounts in accordance with the terms of the contract or agreement, and based on determination of invoice term, payment date, interest or penalty applicable, and amount as specified in the CFR.
Provide certified payment transaction information for the disbursing office to make disbursements as specified in the TFM.
Agencies for which Treasury does not disburse (for example, Senate): Provide payment disbursement forms that include payment transactions consistent with Government Accountability Office (GAO) policy and procedures and as specified in the TFM.
- Use Cases
- Treasury Financial Manual (TFM)
TFM Volume I, Part 4, Chapter 7000; Cancellations, Deposits, Reclamations, and Claims for Checks Drawn on the U.S. Treasury
TFM Volume I, Part 4a, Chapter 3000; Requirements for Scheduling Payments Disbursed by the Bureau of the Fiscal Service
- Contact Details
For inquiries concerning check issue reporting and spoiled or voided checks:
Department of the Treasury13000 Townsend Road
Bureau of the Fiscal Service
Philadelphia Financial Center
Operations Support Branch
Philadelphia, PA 19154
For inquiries concerning budget clearing accounts and identifying suffixes for the F3880 account to:
Department of the Treasury3201 Pennsy Drive, Building E
Bureau of the Fiscal Service
Budget Reporting Branch
Landover, MD 20785
For inquiries concerning 8-digit ALC address changes to:
Department of the Treasury200 Third Street
Bureau of the Fiscal Service
Cash Accounting Branch
Parkersburg, WV 26101
For inquiries concerning IPAC procedures and accounting issues:
Treasury Support Center1421 Dr. Martin Luther King Drive
St. Louis, MO 63106-3716
Direct all other inquiries to:
Department of the TreasuryPO Box 515
Bureau of the Fiscal Service
Philadelphia Financial Center
Customer Service Branch
Philadelphia, PA 19105-0515
This page was last updated on May 03, 2021.