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Settlement and Judgment Processing Guidelines

FPP E.041

Processing Instructions for the Payment of Settlements and Judgments

Step Action

The Attorney General’s office (OAG) sends a letter to the paying agency requesting:

  • An agency settlement (approval) letter
  • A completed Comptroller’s office-approved purchase voucher
  • A warrant distribution instruction memo
  • A settlement/judgment coding block (use only if the settlement/judgment is over $250,000)

For specific examples, see Sample Purchase Voucher and Sample Warrant Distribution Instruction Memo and the Settlements or Judgments Coding Block Form (74-218) PDF.


The purchase voucher is signed by an authorized employee of the paying agency:

  • The rate of interest and the date through which interest accrues must be listed on the purchase voucher when a judgment that bears interest is paid.
  • The paying agency must ensure the payee is set up correctly in the Texas Identification Number System (TINS).

The paying agency enters the payment in the Uniform Statewide Accounting System (USAS) using Document Type 9:

  • Enter N (not confidential), S (some confidential) or Y (confidential) in the CONFIDENTIAL INDICATOR (CONF) field.
  • Enter R in the PAYMENT DISTRIBUTION TYPE (PDT) field to generate a paper warrant.
  • Balance and release the batch.
  • The paying agency employee entering the payment in USAS lists his/her name and phone number.

Note: Agencies are responsible for determining how the payment will be reported to the Internal Revenue Service (IRS).

Specific USAS object codes are used to record payment of settlements and judgments. See Settlement and Judgment Object Codes for the codes and their descriptions.


The paying agency forwards the following to the OAG once an agreement to settle the claim has been reached:

  • Purchase/payroll voucher for each payee
  • Agency settlement (approval) letter
  • Warrant distribution instruction memo
  • Settlement/judgment coding block (if applicable)

The OAG submits the documents and settlement agreement/judgment to the governor for approval.

  • If approved by the governor, the settlement/judgment package is forwarded to the Comptroller’s office for auditing.
  • If approved by the Comptroller’s office, the Comptroller’s office enters Action Code 550 (“Approved by Audit”) into USAS for payment.

The paying agency can review the USAS Document Tracking (S037) screen or DAFR7700 for the action code 550 to verify when the document was approved.

6 In compliance with the warrant distribution memo, the warrants are delivered by courier to the OAG’s office the next business day after the Comptroller’s office approves the document.
7 The purchase voucher and settlement/judgment documents are filed with the Comptroller’s office until the required retention period expires.