Obligational Accounting

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GAO Glossary of Terms and Definition (September 2005)

Obligational Accounting

The accounting systems, processes, and people involved in collecting financial information necessary to control, monitor, and report on all funds made available to federal entities by legislation, including permanent, indefinite appropriations as well as appropriations enacted in annual and supplemental appropriations laws that may be available for one or multiple fiscal years. It is through obligational accounting that agencies ensure compliance with fiscal laws, including the Antideficiency Act and statutes related to the purpose and period of availability of appropriations.

Obligational accounting rests on the central concepts of the “obligation” and “disbursement” of public funds, as those terms are defined in this glossary. The Antideficiency Act, codified in part at sections 1341, 1514, and 1517, and the provisions of section 1501 (commonly referred to as the recording statute) of the United States Code provide the fundamental components of obligational accounting. Obligational accounting is sometimes also referred to as “fund control accounting,” “appropriation accounting,” and “budgetary accounting.” (For a discussion of the method for tracking funds in the federal government, see app. III. See also Administrative Division or Subdivision of Funds; Antideficiency Act; Apportionment; Disbursements;  Obligation.)

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