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Chapter 6

Chapter 6 focuses on the tools and authorities for case managers (CMs) and others to use in facilitating reconciliation and closure efforts. This chapter also discusses FMS reviews, Case Reconciliation/Closure Executive Committee (EXCOM), write-off authority and systemic tools.

Section Title
A7.C6.1. Chapter Overview
A7.C6.2. Organizational Roles And Responsibilities
A7.C6.3. FMS Case Reconciliation/Closure Tools
A7.C6.4. Problem Disbursement (PD) Resolution Policy
A7.C6.5. Systems

A7.C6.1.1. There are many system tools and authorities available to aid in case reconciliation and to expedite case closure. DSCA meets periodically with the FMS community to review issues and constraints encountered during case reconciliation and closure in order to establish policy to remedy situations encountered. DFAS also has system tools that are available for use by the military departments to aid in lifecycle case reconciliation. Chapter 6 addresses the various system tools used to identify and track status of FMS case/lines. This section also addresses several authorities and policies in place to better assist the closure community in reconciling and closing cases. The tools and authorities addressed in Chapter 6 include the EXCOM, write-off authority, problem disbursement resolution policy and current system tools.

The following serves as a general categorization of functions by organization:

A7.C6.2.1. IA performs all case management functions prescribed in the DoD FMR Volume 15 and the SAMM, optimizes the use of the tools and authorities contained herein, ensures widest possible dissemination of these tools and authorities to those involved in FMS case reconciliation and closure, initiates requests for write-off approvals, effects write-off transactions in IA systems, initiates requests for the reconciliation and closure EXCOM and participates in and/or facilitates conferences addressing these issues.

A7.C6.2.2. DSCA publishes and updates policies, approves waivers or exceptions to policies, promulgates tools and authorities to maximize reconciliation and closure performance, solicits purchaser input/feedback on ways to improve these processes, chairs the EXCOM and participates in and/or facilitates conferences addressing these issues.

A7.C6.2.3. DFAS Indianapolis performs all accounting functions as prescribed in the DoD FMR Volume 15 and the SAMM effects write-off transactions in DIFS, promulgates tools and authorities to maximize reconciliation and closure performance, participates in conferences addressing these issues and serves as a member of EXCOM.

A7.C6.2.4. DCMA works directly with Defense suppliers to help ensure that DoD, Federal and allied government supplies and services are delivered on time, at projected cost and meet all performance requirements. In addition, DCMA performs contract administration, quality assurance and inspection functions for the DoD as prescribed in the FAR and DFARS, serves as member of EXCOM and performs contract closeout in accordance with the DCMA Guidebook.

A7.C6.2.5. DCAA performs all contract audits for the DoD as prescribed in the FAR and DFARS including final overhead rate audits required to "final" close FMS cases. In addition DCAA provides accounting and financial advisory services regarding contracts and subcontracts to all DoD components responsible for procurement and contract administration.

A7.C6.2.6. Office of the Under Secretary of Defense (OUSD(C)) publishes, updates, and clarifies financial management policies contained in the DoD FMR Volume 15 as well as participating in the EXCOM.

A7.C6.3. FMS Case Reconciliation/Closure Tools

A wide range of tools exist to aid in the timely and accurate reconciliation and closure of FMS cases. Some of these tools were discussed in earlier chapters, such as the case review and reconciliation matrix/checklist (Refer to Section A7.C2.). In addition, the following publications serve as tools:

A7.C6.3.1. Publications:

A7.C6.3.2. Case Financial Status Reports. Case financial status reports are used to provide a summary level analysis of the country's open FMS cases. Since their preparation constitutes one possible event for the annual case review requirement, their accuracy, completeness and data integrity are vital. The CM participates in decisions and resolves FMS case action items resulting from information contained on the case financial status reports which are used at various meetings, conferences and visits.

A7.C6.3.3. Case Reconciliation and Closure EXCOM

A7.C6.3.3.1. Purpose. The EXCOM provides final resolution on financial discrepancies and imbalances relating to FMS cases/lines that are SSC. The EXCOM is a final arbiter of last resort only. As a general rule, cases are not presented to the EXCOM for consideration unless they are more than two years SSC, and other criteria as established in the requisite documentation package are satisfied (see below). Specific functions of the EXCOM follow:

  1. Approving Discontinued Research.
  2. Finalizing Case Closure Values.
  3. Finalizing Cost Components.
  4. Resolving Force Closure Value Discrepancies.

A7.C6.3.3.2. Considerations.

A7.C6.3.3.2.1. Existing FMS financial policies and procedures already accommodate certain flexibilities and managerial authorities to resolve most of the financial issues that otherwise preclude timely case closure. For example, write-off authority exists to resolve problem disbursements of up to $2,500 per transaction (and $200 for all other discrepant transactions other than SDRs). Additionally, the DoD Comptroller prescribed a timeline of 90 to 120 days (depending on whether the program office and DFAS are co-located) for resolving problem disbursements before the offsetting obligation is posted. Consequently, a relatively small universe of FMS cases are expected to require EXCOM resolution.

A7.C6.3.3.2.2. The EXCOM is not a substitute for sound fiduciary safeguarding and accounting of FMS case financial transactions. Every reasonable effort to reconcile FMS cases in a timely manner and to ensure closure within prescribed time frames, is expected. While the existence of the EXCOM acknowledges that valid situations arise requiring its use, the substantive documentation requirements ensure responsibility for financial stewardship and data integrity rests with the proponent IA and its associated personnel (e.g., CMs).

A7.C6.3.3.3. Membership. To promote its effectiveness and efficiency, membership of the EXCOM shall be comprised of managers responsible for overseeing responsible FMS case reconciliation and closure policies. The lead EXCOM representative from each organization shown below may opt to bring additional officials from that organization. Each lead representative may also designate a substitute to act on his/her behalf; the designation must be sent to the EXCOM Chair prior to the next scheduled meeting. Regardless of how many officials from each organization attend a given meeting, each organization has only one vote in the decision-making processes. Accordingly, the EXCOM is comprised of the following personnel:

Table A7.C6.T1. EXCOM Participants

EXCOM Participants Organization

DSCA (Policy)

EXCOM Chair, DSCA Financial Policy and Analysis

OUSD(C)

OUSD(C)/A&FP

DFAS

DFAS-IN/JAX

DCMA

DCMA/FB

Army

USASAC New Cumberland (AMSAC-LAL-PCS)

Navy

NAVY IPO (240C)

Air Force

AFLCMC/WFCQ

A7.C6.3.3.4. Authorities. Within the parameters of the DoD FMR, the EXCOM has and may exercise wide latitude in determining what specific transactions, processes and actions must be taken to bring specific FMS case reconciliation issues to a successful conclusion. The EXCOM members may not be experts in the nuances of a given situation or in the detailed nature of all supporting systems and databases. The EXCOM relies heavily on the sound recommendations brought forth by the originators of each package.

A7.C6.3.3.5. Operating Procedures. Normally, the EXCOM meets on a semi-annual basis. One of the semi-annual meetings will be held in conjunction with the annual DSCA FMS Case Reconciliation and Closure Conference. To ensure a consistent and unbiased methodology, the timeline in Table A7.C6.T2. applies:

Table A7.C6.T2. EXCOM Timeline

Milestone Time Frame Event

A

T-60

DSCA Financial Policy and Analysis (FPA) issues solicitation for potential EXCOM candidates, and announces next EXCOM meeting date.

B

T-60 to T-30

Proponent IAs assemble EXCOM packages.

C

T-30

Proponent IAs submit EXCOM packages.

D

T-30 to T

Individual EXCOM review of submitted packages.

E

T

EXCOM meets to review submitted packages.

F

T+30

EXCOM decision forwarded to originators.

G

TBD

Actions due by proponent IA/DFAS to resolve issues based on EXCOM decision.

A7.C6.3.3.6. Documentation Requirements. The EXCOM does not generate FMS cases to be presented for consideration, nor does it assemble documentation substantiating requests for EXCOM decision.

A7.C6.3.3.6.1. All requests must originate from the proponent IA. As appropriate, DFAS Indianapolis may initiate packages for review but must first coordinate with the proponent IA before formal submission to the EXCOM.

A7.C6.3.3.6.2. The proponent IA (or DFAS Indianapolis, as noted above) shall prepare a "Request for Discontinued Research Approval and Case Closure Resolution" package in the format prescribed in Section A7.C6.F1. The reporting format contains instructions for the specific documentation that must accompany the request itself.

A7.C6.3.3.6.3. Of paramount importance are the recommendations offered by the initiator, to include rationale for those recommendations (for example, cite the basis for the desired un-liquidated obligation value).

A7.C6.3.3.6.4. A request without the required supporting documentation is considered incomplete and is returned to the originator. To the extent possible, all packages should be e-mailed to every EXCOM member. Alternatively, the packages can be mailed; contact the EXCOM members if mailing instructions are needed.

A7.C6.3.3.6.5. For expediency and efficiency, the proponent IA may "bundle" requests of a similar nature for multiple FMS cases/lines. While individual requests need not be sent to the EXCOM incrementally, complete supporting documentation for every case/line being submitted for EXCOM review is mandatory. Additionally, the EXCOM Chair may limit the number of packages that can be submitted for an individual EXCOM session.

Figure C6.F1. Request for Discontinued Research Approval and Case Closure Resolution

A7.C6.3.3.7. Presentation of Cases. During the EXCOM review, the following process shall be observed:

A7.C6.3.3.7.1. The package originator must be present or send an alternate who is fully knowledgeable of the issues.

A7.C6.3.3.7.2. All EXCOM members should be present for the entire meeting. At least four of the EXCOM members must be present to constitute a quorum.

A7.C6.3.3.7.3. The originator provides a brief narrative highlighting the key issues needing EXCOM resolution.

A7.C6.3.3.7.4. Any EXCOM member may pose any question to obtain sufficient clarification.

A7.C6.3.3.8. Decision Process:

A7.C6.3.3.8.1. Each EXCOM member shall vote on the specific actions being recommended by the originator.

A7.C6.3.3.8.2. Optimally, EXCOM members should reach consensus on each decision. Where consensus or even a majority are lacking, the EXCOM Chair may make a final ruling. However, a lack of general agreement on a given action likely results in requesting additional information and/or time.

A7.C6.3.3.8.3. Once the EXCOM has met to discuss the status of a particular request, a formal decision is sent to the originator within 30 days. That decision contains the detailed EXCOM reply, to include step-by-step actions that are allowed to fully resolve the issue heretofore precluding closure of the impacted FMS case(s).

A7.C6.3.3.8.4. The EXCOM publishes Minutes of each meeting to fully document discussions and decisions.

A7.C6.3.3.8.5. Actions prescribed by the EXCOM in the formal published decisions must be accomplished in a timely manner by the proponent IA, DFAS and other activities, as applicable. While the EXCOM makes the final decisions, the EXCOM members do not have the means to actually effect the requisite transactions to financially resolve the FMS case(s) involved. Accordingly, due dates for completion of actions accompany the individual actions noted by the EXCOM.

A7.C6.3.3.8.6. The EXCOM monitors the status of resulting actions.

A7.C6.3.4. Conferences.

A7.C6.3.4.1. DSCA FMS Case Reconciliation and Closure Conference. The DSCA conference is comprised of members from DSCA, the IAs, DFAS Indianapolis and the purchasers. This conference meets annually (usually November/December timeframe). Discussions concern financial policy issues (current, pending and proposed) impacting FMS case reconciliation and closure, and reconciliation issues throughout the case execution phase, SSC phase and in preparation for closure. The EXCOM meets in conjunction with this conference. DSCA/OPS-ADMIN chairs this conference.

A7.C6.3.4.2. IA Conferences. The IAs hold, at their discretion, conferences to address reconciliation/closure issues at a more detailed level.

A7.C6.3.5. Write-Off Authority (DoD FMR Volume 15, Chapter 0211). Refer to DoD FMR Volume 15, Chapter 3, Section 0310. A DoD Component which determines that unresolved reconciliation issues for a case exist may write-off those imbalances using the following guidelines.

A7.C6.3.5.1. For PDs. Write-off authority exists for up to $2,500 per transaction. Refer to DoD FMR Volume 3, Chapter 11 for an elaboration of the policies and procedures relative to PDs. PDs greater than $2,500 should be brought to the attention of DSCA (Business Operations Directorate, Financial Policy and Analysis Division) via the FMS Case Reconciliation and Closure EXCOM for resolution, provided those PDs have not exceeded the timelines noted in Section A7.C2.10.

A7.C6.3.5.2. For All Other Types of FMS Financial Transactions. Write-off authority exist for up to $200 per transaction (for other than SDRs) and is charged against the FMS Administrative Charge Budget, object classification 42.3, "Supply Discrepancy Reports Charged for FMS Cases" for the amount required to effect prompt reconciliation as prescribed in the DSCA annual case review requirement (See Figures A7.C2.F5., A7.C2.F6., and A7.C2.F7.). For write-off adjustments performed in support of readying a case for closure, DFAS Indianapolis provides DSCA (Business Operations Directorate, Financial Policy and Analysis) with a quarterly summary of closure certificates received in which amounts have been charged in accordance with this policy. A comment shall be included in the remarks/comments section of the case closure certificate (refer to Section A7.C4.7.) when those write-offs are utilized.

A7.C6.4.1. Refer to Section A7.C2.10. for information on how to resolve PDs.

The objective to improve case closure by improving case execution is accomplished by ensuring that adequate IT tools exist to assist the CM in performing "best case execution" practices. Improved case execution promotes better data integrity, increased responsiveness to the purchaser's informational needs, a more efficient use of DoD resources, and timely case closures. The following tools assist with case closure reconciliation and are applied throughout the IAs, DFAS Indianapolis and the DoD FMS case management community:

A7.C6.5.1. DIFS FMS Detail Delivery FK History Search. The DIFS history search provides DIFS performance history details on delivery performance as well as progress payment performance ('NA'/'ND' transactions). It provides Reimbursement codes to determine Liquidating and Non-Liquidating detailed costs, Delivery Source Codes, Price Codes, as well as Stock Fund Add On, CAS, LSC, Accessorial and Admin costs. The DIFS History Search can be used at closure reconciliation to manually compare what was recorded in DIFS vs. what was recorded in the IA system at the case, line item or detail/requisition level. The DIFS history search is available through an online request in DIFS using the selections as outlined in Figure A7.C6.F2. The performance transaction types can be identified as listed in Table A7.C6.T3.

Figure A7.C6.F2. FK History Search

Table A7.C6.T3. DIFS History Search Performance Transaction Types

A7.C6.5.2. Mechanization of Contract Administration Services (MOCAS). Additional information regarding MOCAS can be found in DLAM 8000.3, MOCAS Users Manual for Contract Administration.

A7.C6.5.2.1. Description. MOCAS permits a greater degree of automation in procurement and contract administration. MOCAS interactively provides information on invoices processed against DoD contracts that DFAS is responsible for paying. MOCAS pays invoices for hardware supplies and services using Electronic Data Interface (EDI) for receipt and storage of commercial invoices, requests for progress payment and public cost vouchers. DFAS payment offices use MOCAS as the administration payment system.

A7.C6.5.2.2. Utilization. MOCAS is a database system designed to provide:

A7.C6.5.2.2.1. DCMA with information necessary to accomplish their mission for contract administration production and quality assurance.

A7.C6.5.2.2.2. Management, financial and inventory data to purchasers (services), buying offices, funding offices, and inventory managers.

A7.C6.5.2.2.3. Payment to contractors or their designee.

A7.C6.5.2.2.4. Disbursement information for DFAS.

A7.C6.5.2.2.5. Reports to the military department for transmission to the Office of the Secretary of Defense (OSD), Treasury or General Accounting Offices.

A7.C6.5.2.2.6. Automatic closeout of contracts as prescribed by the FAR.

A7.C6.5.2.2.7. Maintenance of source documents for all of the above.

A7.C6.5.2.2.8. Obligation and payment histories at the detail level, which can be manually compared to the IA system records. This is used during the case closure reconciliation to confirm the accuracy of final expenditures in the IA systems.

A7.C6.5.2.3. MOCAS Financial Subsystem. The financial subsystem is made up of distinct database records. These records contain all the information necessary for the research and payment of an invoice. They include contract administration information, accounting line data, CLIN data, shipment data, invoice data, and financial history data. Table A7.C6.T4. is a brief description of these records.

Table A7.C6.T4. MOCAS Financial Subsystem Data Elements

A7.C6.5.3. Standard Contract Reconciliation Tool (SCRT)

A7.C6.5.3.1. Purpose. SCRT was developed as a tool for the reconciliation of MOCAS paid contracts. A SCRT users guide is located at: https://dfas4dod.dfas.mil/systems/scrt/userguide.pdf.

A7.C6.5.3.2. Requirements. The data records must be maintained and used to verify whether an adjustment was necessary. The Responsible Contract Reconciliation Agent (RCRA) documents the adjustment within the contract folder. Generally those records include (but are not limited to) contract modifications, payment vouchers and printouts of any retrieval used. A user must also have access as a SCRT reconciler to be able to perform a SCRT adjustment.

A7.C6.5.3.3. Adjustment Process. If an error is identified within either the IA accounting system records or the MOCAS records and an adjustment is required, the RCRA must approve those corrections in SCRT. Once the adjustment is approved in SCRT, it is then interfaced with MOCAS where it updates MOCAS records. If properly done, the update to MOCAS creates a 1S1/1B1 record that is passed to the Accountable Station to update the accounting system. There are a few exceptions to this – most notably new records cannot be generated (a record that did not already exist) e.g., a new contract may be added to SCRT, a payment cannot be posted to a contract that never had a payment posted to it.

A7.C6.5.4. Electronic Document Access (EDA). EDA uses the Internet to provide DoD on-line access to share, store and retrieve contracts and other documents electronically. EDA offers read-only access to official contracts, contract modifications, vouchers, Government Bills of Lading and accounting and finance documents. EDA provides one common file format that eliminates the need to maintain hard copy files, reducing the need to print, mail, file, and manage paper. EDA is a means to access a contract or a contract modification using the internet for viewing purposes only. The DFAS web address for EDA is: http://www.dfas.mil/ecommerce/eda.html.

A7.C6.5.5. Shared Data Warehouse (SDW). SDW provides a central repository of uniform data for shared access to support the DoD network. SDW is a non-OLTP Oracle database updated daily with MOCAS transaction data. SDW is a query-only web site and requires a User-ID and password. A new SDW called DFAS Corporate Warehouse (DCW) is being developed for the DFAS Corporate Database (DCD). SDW receives file transfers of contract awards and modifications. The web address for SDW is: https://www.sdw.dcma.mil/index.html.

A7.C6.5.6. Contract Reconciliation System (CRS). CRS is much the same as SCRT, with a few significant differences. Only DFAS has the ability to input into CRS. CRS can be used to directly update MOCAS and unlike SCRT, the limitation on new records does not exist. There are defined requirements for CRS adjustments. More information is located at: https://dfas4dod.dfas.mil/systems/crs/.

A7.C6.5.7. Security Cooperation Information Portal (SCIP). The SCIP assembles corporate information from FMS legacy systems CISIL, SAMIS, CMCS, MISIL, DSAMS and DIFS, and provides that consolidated information to the purchaser and DoD users in a common format. It provides a secure avenue for information exchange and data assurance. Secure web site for authorized users is: https://www.scportal.us/portal.

A7.C6.5.8. Other Internet Links.

Organization Link

USG regulations:

http://www.regulations.gov

DSCA:

http://www.dsca.mil

OUSD(C):

http://comptroller.defense.gov/

DFAS:

http://www.dfas.mil