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Page Title: Interest Payments
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2. The dealer’s bill was held by a later processing activity for more than the allowable one-third of the discount period. In these cases, the paying activity is held responsible only if it acted as the forwarding activity and held the dealer’s bill longer than one-third of the discount time, and the discount period expired while the bill was in transit. Regular reviews of lost discounts will point out activities that habitually lose mandatory discounts. Based on these reviews, monthly advice is furnished to each  of  these  activities.  These  activities  will  be requested to review their procedures and take necessary actions to prevent the continual loss of discounts. In addition  to  requesting  corrective  actions  based  on records  of  discounts  lost,  the  DO  will  review  all activities under his or her jurisdiction at least once every 6 months. Through this review, the DO will identify those  activities  regularly  causing  lost  mandatory discounts and will recommend appropriate actions. INTEREST   PAYMENTS.—   The   Prompt Payment Act of 1982 (Public Law 97-177) requires a federal agency to make interest payments whenever that agency  fails  to  make  payment  promptly.  The  interest payment provisions of the act are viewed as a penalty for   failure   to   accomplish   the   important   mission requirement of making payments on time. The Navy’s policy is to reduce all interest payments to a minimum level. When a vendor’s contract specifies a due date, the government  expects  the  federal  agency  involved  to make  payment  in  time  to  avoid  interest  charges.  But what  if  your  activity  receives  a  vendor’s  contract  that does not specify a due date for payment? How can you determine the due date for payment when no due date is specified in the contract? How can you determine whether or not interest is payable? When a contract fails  to  specify  a  due  date  for  payment,  the  government requires you to treat the contract in the same manner as you would a contract that has a due date specifying payment within 30 days. As long as your activity makes payment  within  30  days,  no  interest  is  payable. Incidentally, the government requires your activity to pay close attention to discounts. Interest is payable on improperly  taken  discounts. The  Secretary  of  the  Treasury  establishes  the interest  rate.  Published  semiannually  by  the  Federal Register and  NAVCOMPTNOTE  4330,  the  interest  rate is  effective  for  a  6-month  period  beginning  1  January and 1 July. Interest is computed from the day following the payment due date through the date of payment and is   compounded   for   each   30-calendar-day   period following  the  original  due  date.  Interest  payments  of less than $1 should not be made. No further interest will accrue after 1 year beyond the original due date. The filing of a claim under the Contract Disputes Act will also stop accrual of additional interest as of the date of filing. What do the Prompt Payment Act and the federal interest  rate  mean  for  a  local  disbursing  office? Basically,  the  paying  office  will  pay  interest automatically without requiring any requests from the vendor or business concern. Payments due on Saturday or Sunday maybe paid on Monday or the next working day  without  interest,  and  payments  due  on  legal holidays may be paid on the next working day without interest. PUBLIC VOUCHER FORMS The DOD uses various types of PV forms. Figure 6-3 lists some of the most common PV forms found in disbursing   offices.    The purpose of this listing is to make you aware that certain types of transactions will be paid on prescribed PV forms. You must be able to determine the correct use of the properly prescribed forms for each type of transaction. DISTRIBUTION Once a PV has been paid, proper distribution of its original and copies must be made. Again, the type of payment  and  the  appropriation  charged  will  determine the number of copies needed and where they will go. ORIGINAL The  DO  retains  the  paid  original  PV,  with  the original dealer’s bill and all other required supporting documents  attached,  in  his  or  her  safe  or  security container. (As previously mentioned, this container must carry at least a Class 1 or Class 5 rating.) The DO retains this documentation until forwarding it as part of the original financial returns. The  DO  forwards  the  returns  to  the  central disbursing  officer  (CDO)  in  support  of  the  Daily Statement of Accountability, DD 2657, or the monthly Statement  of  Accountability,  Standard  Form  1219.  The CDO  consolidates  the  files  of  all  original  PVs  and submits them with his or her financial returns. To ensure the integrity of the original PVs, the CDO uses a system of logs or check-out cards to control access to them. 6-8

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