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DOd hENT 2S3
05090 - (800585500]
The Federal Governmentes Bill Payment Petfoerawe. Is Goo but
Should Be Better. FSD-78-16; B-160725. Febeuar 24# 1978. 30
pp. * 3 appendices (29 pp.). -
Report to the Congress; by Blaer 3. Staats# Coptreller General.
issue Area: Accounting and Financial DepGrting (28001.
Contact: Financial and General Eanageint Studies Div.
Budqet Function: General Goveraeat: scutivo Directiou and
Management (802); liscellaeols$ Financial Masagement and
information Systems (1002).
Orqanizction Concerned: Department of the Treasury; Department
of Defense; General Services administration; Office of
sangement and Budget.
Congressional Relevance: Congress; House Committee on Armed
Service s.
Authority: 10 U.S.C. 2307. 31 U.S.C. 529. 41 U.S.C. 255.
many companies doing business with the Federal
Government have complained that its agencies are slow in paying
their bills. To determine how vall the Govornaent does as a bill
payer, a sample of 3,263 contractor invoices totalling t34.1
million was analyzed as were responses from 590 Contractors
concerning tke payment performance of Federal agencies.
rjndinqsconclusious: About 615 of the e&.ernaent' s bills and
81% of the dollar total are paid within 30 days, the accepted
period in commercial practice. Nearly 855 of the bills and 981
of the dollar total are paid within 60 lays. rhen adjusted for
delays caused by contractors and other %auses not attributable
to Federal agencies, 70% of the bills and 83% of the dollar
amount were paid on time. Delays in making pujments harm the
contractors' cashflow and reduce the Government's opportunitj to
benefit from cash discounts. Delayed payments may also cause
contractorm to stop doing business with Federal agencies
although only 16% of the companies questioned indicated that
they were dissatisfied with the Governmmt's poymentso Invoices
involving recurring payments such as utilities* telephone and
data processing services were twice as likely to be late as
invoices for one-time proceremeans and invoices for lizge
amounts were generally paid faster than ssual-4ollar iavgoies.
Recommendations: The Director, Office of manageent and Budget*
together with the Departments of the Treanury and Defease a
the General Services Administratione should: require Federal
agencies, shen practical, to include payment tems in each
contract and purchase order; develop due 4ato standards for
major types of goods and services; explore the extended use bu
both civil and niltary agencies of ptredes for paling bls
without a receiving report; authorize the use of imprest feans
to pay small bills on delivery; decide how clon to the d4e &ae
agencies should schedule bills for paymet; and continue to
monitor payment performance, making sure thAt agencies are](ViewImageLocal?handle=hein.gao/gaobaawrx0001&div=1&collection=&method=preview&ext=.png&size=3)