What type of funds are subject to the Bona fide needs rule and can be used for new obligations?

• A. Anticipated
• B. Current
• C. Deemed
• D. Expired

Answer: (B)

The Bona fide needs rule applies to current funds—the money that is available to be obligated during the current fiscal year. If a genuine government need arises during that period, you can use current funds to incur a new obligation to meet that need. This ensures spending aligns with what actually exists and is needed now, rather than prepaying for future periods or spending with funds that are no longer usable.

Expired funds aren’t available for new obligations—they can only be used to liquidate existing obligations. Anticipated funds aren’t yet available to obligate. Deemed funds isn’t a standard term used for this purpose, so it doesn’t apply.