The US government uses specific exchange rates to acquire foreign currencies for official expenditures. These rates, reported by disbursing officers at each post on the last business day of the preceding month, are reflected in a quarterly report. These rates are essential for government accounting and budgeting processes.
Significant deviations of 10% or more between current market rates and the published rates trigger amendments to the quarterly report. An amended rate appears as a new line item with a distinct effective date. For instance, an April 30th amendment would have two entries: the original March 31st rate and the April 30th amended rate, applicable for May and June transactions. Amendments also address the introduction of new foreign currencies. This amendment process ensures that the reported rates remain relatively accurate reflections of the actual market conditions.
Certain transactions are exempt from using the standard reporting rates. These exceptions include collections and refunds governed by international agreements, conversions between foreign currencies, sales of foreign currencies for US dollars, and transactions impacting dollar appropriations. Detailed information regarding these exceptions is available in the Treasury Financial Manual 2-3200. This manual provides comprehensive guidance on financial management and accounting procedures within the US government.
To maintain consistency, all US government agencies are required to utilize these published rates for converting foreign currency balances and transactions into US dollar equivalents. However, due to the inherent time lag, these rates are not suitable for valuing transactions affecting dollar appropriations. They serve primarily as a standardized benchmark for reporting purposes. Historical exchange rate data prior to 2001 can be accessed via the GovInfo.gov website, which offers individual reports dating back to 1963 and a consolidated report from 1956. This archive provides valuable historical context for analyzing currency fluctuations and trends.
