Budgeting & Financial Oversight Flashcards

What is the purpose of a 'funds availability certification' on a contract action?

Answer: To confirm that sufficient, legally available funds exist to cover the obligation

Funds availability certification ensures that money is properly appropriated, available in the correct amount, and legally usable for the stated purpose before an obligation is created.

Under FAR Part 32, what is an 'incremental funding' arrangement?

Answer: Funding a contract in stages rather than obligating the full estimated cost at award

Incremental funding obligates less than the total contract value at award, with additional funding added as it becomes available, commonly used in cost-reimbursement contracts.

What is the 'bona fide needs rule' in federal appropriations law?

Answer: An agency may only obligate current-year funds for needs that genuinely exist within that fiscal year

The bona fide needs rule prohibits agencies from obligating current-year funds to stockpile supplies or fund future-year requirements, ensuring appropriations serve present needs.

A contracting officer is about to award a contract but the fiscal year ends in two days and the funds are expiring. Which action is appropriate?

Answer: Award only if there is a genuine current-year need and funds are properly available

A valid obligation can be made with expiring funds only if there is a genuine bona fide need in the current fiscal year and all procurement rules are followed.

What distinguishes 'no-year' funds from 'single-year' appropriations?

Answer: No-year funds remain available for obligation indefinitely, while single-year funds expire at fiscal year end

No-year (or 'X-year') appropriations have no expiration date and remain available until expended, unlike annual appropriations that expire at the end of the fiscal year.

Which document formally requests funds to be moved from one budget line item to another within an approved appropriation?

Answer: A reprogramming action

Reprogramming actions formally transfer funds between budget line items within the same appropriation, often requiring Congressional notification depending on the amount.

What is the significance of the 'period of performance' in relation to multi-year contract funding?

Answer: Funds must be available for each year of performance, with each year's work funded by that year's appropriation unless multi-year authority exists

Unless multi-year contracting authority is granted, annual appropriations fund only the year in which costs are incurred, making period of performance critical to funding planning.