What year funds would be used to pay a claim submitted in FY10 for obligations made in FY 08 and FY 09?
In answering the question, the answer will be based on multiple factor. The most important factor is what appropriation, and in what FY has the contractor start, incrementally delivered, or completely delivered a service or product. You have to follow the funding policy rules to determine when payments should be made.
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In accordance with the bona fide need rule (Title 31, U.S.C., Sec 1502), required funds are to be used only for needs or services in the year(s) of the appropriation's obligation period. With that, whatever appropriation and FY was cited and obligated on the contract vehicle can be used for payment.
To answer your question, we would need to know what appropriation is on the contract. If it is the same appropriation, you would use the oldest first (FY08) before it is expires.
DOD policy in relationship to payment of contracts is found in Volume 10 of the DODFMR.
For additional help, please consult your local Comptroller office for your respective agency.