TN 30 (03-02)
DI 39506.203 Updating and Reconciling Unliquidated Obligations
A. Policy - current year
Valid unliquidated obligations should be supported by documents/records that describe the nature of the obligations and support the amounts recorded. It is particularly important that changes in CE and MER authorizations (e.g., cancellation or modification) are reflected in the unliquidated obligations reported by the agency. State agencies should review unliquidated obligations at least once each month to cancel those no longer valid—and screen CE authorizations to determine whether the unliquidated obligation represents an authorization still in effect.
B. Policy - prior years
State agencies will report fiscal year obligations by line item for each fiscal year still open. A fiscal year is considered open until all obligations have been liquidated. However, regardless of whether unliquidated obligations remain, 31 U.S.C. 1552 provides that on September 30 of the fifth fiscal year after the period of availability for obligation ends, the account closes and any remaining obligation or unexpended amounts are cancelled and become unavailable for expenditure. Therefore, it is important that States resolve all unliquidated obligations by that time. States will be unable to recover funding for any unliquidated obligation once the account is closed.
States must submit a separate quarterly report by line item for each open fiscal year's obligations as long as obligations remain unliquidated. The status of unliquidated obligations--including an explanation of why unliquidated obligations remain--should be given in a narrative statement accompanying the report.