BOP Program Statement 2250.03 § 2

a. Business Administrator. For the purposes of this Program Statement, the title of Business

Administrator is used to represent all of the different titles currently being used to identify the

head of the local OFM.

b. Financial System Obligation Module. This is used to establish/modify obligations as

undelivered orders or accounts payable. It also provides current management information

reports.

c. Undelivered Orders (U/O). These are obligations for goods or services that have not been

received by, or performed for, the Bureau. The Business Administrator must ensure that

obligations for ordered goods are established in undelivered orders, rather than accounts payable,

within two business days of receipt of the obligating document.

The items must remain in undelivered orders until they are received and accepted, as evidenced

by a properly prepared Receiving Report (or other appropriate evidence).

d. Accounts Payable (A/P). These are obligations for goods or services that the Bureau has

received. The Business Administrator must ensure that obligations are liquidated from

undelivered orders and established as accounts payable when the Bureau receives goods and

services.

Services are to be established as accounts payable in the month in which the services are

performed.

e. YREGDOC. The YREGDOC is an alphanumeric indicator that stands for fiscal Year (1

digit), REGister (2 characters), and DOCument number (5 digits). A six-digit document number

may be assigned.

A unique YREGDOC must be assigned to each obligation and is associated with the obligation

from the time it is established through payment. The CCM ordinarily assigns the YREGDOC.

f. Register. The register in the YREGDOC is tied to each account class/cost center and is used

to facilitate the numbering and grouping of obligation documents.

g. Document Number. The document number assigned as part of the YREGDOC must not

begin with zero and must be numeric.

P2250.03 5/8/2017 3

h. Obligation Month. The obligation month is the month in which the obligation reduces/

affects funds availability.

i. Available Month. The available month is the month in which the obligation is available to

make payments against.

j. Recurring Obligation. A recurring obligation is established for services being provided

continually across months and is a definite amount each month. Recurring obligations are

entered directly from the purchase order or contract.

A recurring obligation is established for a total amount and can be assigned to months or

distributed across months. An example of a recurring obligation is a monthly rental – the same

amount is obligated and paid for each month.

k. Annual Obligation. An annual obligation is a type of recurring obligation and is established

for services being provided continually, but for which the monthly obligation amount may vary

from month to month.

Payments can exceed the monthly obligations, but not the annual obligation. The CCM should

request the annual obligation as a single line amount based on historical data on the purchase

order. The CCM should attach his/her accrual memorandum distributing the amount by month.

The memorandum must be adjusted monthly to reflect actual expenses, not to exceed the total

purchase amount. A modification must be prepared at the end of the year to reflect actual

expenses. Utilities are an example of an annual obligation.

The accruals established for future months are not automatically reduced when a monthly

payment exceeds the monthly accrual. Therefore, the system will allow the total payments plus

the accruals to exceed the annual contract amount.

It is important that CCMs monitor their accruals and adjust them accordingly to ensure the

obligations (payments plus accruals) do not exceed the annual contract amount.

l. Non-recurring Obligation. A non-recurring obligation is normally a one-time purchase,

recorded against a single obligation month.

Note: For contracting records purposes, any adjustments, up or down, must be done on a

modification to the purchase order/contract.

P2250.03 5/8/2017 4