Attachment, ADC 1198

Page 1

Attachment to ADC 1198

Establishing and Maintaining Accountability for Service Owned 

Capital Equipment Stored at DLA Distribution Centers

ORIGINATING SERVICE/AGENCY AND POC INFORMATION:

a. Technical POC: Army, Oliver Pryor, HQDA G4, DALO-SUS, (703) 693-9956, or 

email: oliver.c.pryor.civ@mail.mil

b. Functional POC: Army, Matt Adams, ASA(ALT), SAAL-ZL, (703) 617-0454, or 

email: matthew.c.adams32.civ@mail.mil

c. DLMS POC: Defense Logistics Management Standards Office (DLMSO), 

email: DLMSO.IUID@dla.mil

2. FUNCTIONAL AREA:

a. Primary/Secondary Functional Area: Supply

b. Primary/Secondary Functional Process: Physical Inventory Control and 

Adjustments

3. REFERENCES:

a. DOD Integrated Requirements Set (IRS) for Item Unique Identification (IUID) in 

Supply Business Processes (Modified to support capital equipment visibility). Draft dated 

December 11, 2015

b. Defense Logistics Manual (DLM) 4000.25, Volume 2, Supply Standards and 

Procedures

c. Capital Equipment, Proposed DLMS Change (PDC) 1198 Meeting with

ODASD(SCI), Army, DLA J33, and DLMSO, November 18, 2015

d. DOD 7000.14-R, Defense Financial Management Regulation, Volume 4, Accounting 

Policy, Chapter 6, Property, Plant and Equipment 

e. OUSD(AT&L) and OUSD(Comptroller) Memorandum, "Elimination of Military

Equipment Definition and Increase to Capitalization Thresholds for General Property, Plant and 

Equipment", September 20, 2013

f. Public Law 111-84 October 28, 2009, National Defense Authorization Act (NDAA) 

for Fiscal Year 2010

g. Federal Accounting Standards Advisory Board’s Statement of Federal Financial 

Accounting Standards No. 6 (SFFAS 6)

h. Defense Logistics Agency (DLA) and Service Owned Assets Meeting, November 

15, 2015, led by Mr. Steve Tkac, Deputy Director, Acquisition Resources & Analysis (ARA) 
Attachment, ADC 1198

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for Property & Equipment Policy, and Ms. Jan Mulligan, (ODASD(SCI)); attendees DLA, 

Army, Marine Corps, and Air Force

i. Army meeting with DLA on capital equipment transaction requirements for Army 

materiel managed by the DLA, July 24, 2015. DLA Codes participating were J344, J345, DLA 

Army NAM J313A, DLA Audit Readiness reps from J34, and DLA Distribution reps from DDC 

HQ J3.

j. Approved DLMS Change 1071, Implementation of DOD Item Unique Identification 

(IUID) Supply Policy in Version 4030 DLMS 856R Shipment Status Materiel Returns, March 

26, 2014

k. DODI 8320.04, Item Unique Identification (IUID) Standards for Tangible Personal 

Property, September 3, 2015

l. DODI 5000.64, Accountability and Management of DOD Equipment and Other 

Accountable Property, May 19, 2011

m. DODM 4140.01, DOD Supply Chain Materiel Management Procedures, Volume 9, 

Materiel Programs, February 10, 2014

4. APPROVED CHANGE(S): Substantive updates subsequent to staffing are identified in 

green highlight.

a. Brief Overview of Change: This document is one of a series of DLMS changes to 

define procedures and establish a coordinated implementation for the exchange of serial number 

and unique item identifier (UII), when available, to support Financial Improvement and Audit 

Readiness (FIAR) compliance and accountability over service owned capital equipment stored at 

DLA. This change is based upon the capital equipment candidate requirements in the DOD

Integrated Requirements Set (IRS) for Item Unique Identification (IUID) in Supply Business 

Processes (Reference 3.a.) (hereafter referred to as the IRS). The IRS establishes overarching 

requirements for the application of IUID and related serial numbers in supply business processes 

across the DOD enterprise. ODASD(SCI) develops the IRS in conjunction with the DOD IUID 

Working Group. This approved change establishes the necessary DLM 4000.25, DLMS, 

Volume 2, (Reference 3.b.) procedures for inclusion of serialization data in all DLMS balance 

affecting transactions for capital equipment candidate assets. For the serialization data for 

capital equipment candidates, the serial number is required in the DLMS transaction, and the 

UII, must be included when available. In the scope of this change, the following DLMS 

transactions require notification to DOD Component automated information systems (AIS) with 

serialized data:

• 527R Receipt (527R with 1/BR02/020 Transaction Type Code D4)

• 867I Issue 

• 842A/W SDR Submission

• 842S/Q Storage Quality Control Report

• 846R Location Reconciliation

• 856R Shipment Status Materiel Returns

• 856S Shipment Status 

• 945A Materiel Release Confirmation

• 947I Inventory Adjustments
Attachment, ADC 1198

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b. Background:

(1) All applicable DOD activities are responsible for appropriate financial 

accounting of capital equipment in accordance with the DOD Financial Management Regulation 

(FMR), Volume 4, Chapter 6 (Reference 3.d.) and the latest guidance issued from the USDAT&L and OSD-Comptroller in September 2013 (Reference 3.e.). Further, in compliance with 

public law (NDAA 2010 section 1003 (Reference 3.f.), all DOD activities are to assert full 

financial statement audit readiness by the end of Fiscal Year 2017. The latter requires DOD 

entities support a full and accurate accounting of their capital equipment at the unique item level 

of detail (i.e., serial number/UII), regardless of their physical location. Additionally, the Federal

Accounting Standards Advisory Board’s Statement of Federal Financial Accounting Standards 

No. 6 (SFFAS 6) (Reference 3.g), specified requirements references mandate financial 

accounting for each individual General Equipment Capital Assets owned by the government 

entity, regardless of its storage location.

(2) The IUID Working Group, in conjunction with ODASD(SCI) and P&EP,

developed and approved the overarching requirements for which the detailed DLMS procedures 

and transaction updates are set forth in this ADC. The DOD IRS for IUID in Supply Business 

Policy was amended on July 1, 2015 to include the requirement that all balance affecting 

transactions and discrepancies for capital equipment candidates maintain serialization data 

visibility between storage activities and owner/manager systems. When new requirements in the 

IRS impact DLMS, PDCs are written to reach consensus on the DLMS procedures necessary to 

implement the approved requirements. The most recent IRS includes requirements for capital 

equipment candidate visibility by serial number and UII (when available). At the November 18, 

2015, meeting (Reference 3.c), ODASD(SCI) requested that DLMSO jointly develop this ADC 

to address the DLMS changes necessary for the IRS capital equipment candidate requirements, 

with input from DLA on the cost to the Components for distribution centers to provide this 

service.

(3) These financial accounting requirements have specific relevance to capital 

equipment in DLA Distribution Center storage as well as to DLMS inventory management 

transactions, including receipt, physical inventory, inventory adjustments, location reconciliation 

and issuance. To that end, DOD Component AIS’ will process DLMS transactions cited in 

paragraph 4.a., on individual capital equipment. Due to no existing requirements, DLA is not 

currently providing Serial Number/UII level of detail for any Service Owned assets stored at 

DLA with a FLIS IUID=Y, therefore a method is needed to identify capital equipment candidate 

national identification numbers (NIIN) which require visibility at the serial number/UII level. 

(4) Capital equipment is defined as tangible personal property items that: (1) 

have an acquisition cost at or above the current capitalization threshold, with a useful service life 

of two or more years; (2) are functionally complete for their intended purpose, durable, and 

nonexpendable; (3) are not intended for sale in the ordinary course of business; (4) do not 

ordinarily lose their identity or become a component part of another article when put into use; 

and (5) are available for the use by the reporting entity for its intended purpose (See DoDI 

5000.64, Reference l.) Source of definition: Guidelines for Registering Government 

Serialization, Type Designation and Ownership of Major End Items, Assemblies and 

Subassemblies and Capital Equipment in the IUID Registry, Version 1.1 October 15, 2007.
Attachment, ADC 1198

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c. Capital Equipment requires serialized management to support audit readiness in 

accordance with (a) Public Law, National Defense Authorization Act (NDAA) for Fiscal Year 

2010, (b) the Financial Accounting Standards Advisory Board’s Statement of Federal Financial 

Accounting Standards No. 6,(c) OUSD(AT&L) and OUSD(Comptroller) Memorandum, 

"Elimination of Military Equipment Definition and Increase to Capitalization Thresholds for 

General Property, Plant and Equipment", September 20, 2013, and DODI 5000.64,

Accountability and Management of DOD Equipment and Other Accountable Property, May 19, 

2011.

(1) The logic used to determine a capital equipment candidate NIIN is as follows 

and applies to the most restrictive definition of capital assets in the DOD: Class II, VII, or VIII

(determines stand-alone item) and has a catalog price greater than or equal to $100K. All items 

identified as capital equipment candidates must have the FLIS IUID indicator set to Y (YES). 

Items that meet these three requirements require tracking by serial number and when available 

UII.

d. Requested Change in Detail: This change addresses the additional procedures 

required to be implemented within AIS’ to provide visibility for items identified as capital 

equipment candidates. For capital equipment candidates, serial number is a required entry and 

the UII must be provided when it is available. Detailed procedures are provided throughout 

DLM 4000.25, DLMS, Volume 2 in the affected chapters (Enclosure 2). Items requiring asset 

visibility will be defined in DLM 4000.25, Volume 1, as shown in paragraph 4.e.(3).

(1) Transactions requiring the inclusion Serial Number and UII (when available)

are identified in paragraph 4.a.

(2) The changes identified are additive to the existing procedures in the DLMS 

Manual, Volume 2, the affected chapters are 4, 5, 6, 7, 11, 13, 14, and 17. 

(a) Criteria for identifying Capital Equipment Candidates. Application of 

the capital equipment definition results in a mix of capital and non-capital equipment within a 

NIIN population. In order to allow for uniform tracking and processing for all equipment within 

a NIIN, these procedures are instead based upon identification of capital equipment candidate

NIINs. Capital equipment candidate material is identified as an item that (1) has a FLIS IUID 

Indicator Y; (2) is within Classes of Supply II, VII, and VIII; and (3) has a current Unit Price 

recorded in FLIS of at least $100K. 

(b) Once an individual item is serially tracked it will be tracked for life.

Staffing Note 1: This rule impacts DSS design because they need to have the capability to 

recognize an item that was previously tracked regardless of the current FLIS unit price. 

(3) The following section provides an overview of the key transactions in this 

process and identifies whether there are changes required to existing procedures for the use of 

standard transactions to establish visibility of capital equipment candidates to support FIAR 

compliance. Changes required to individual DLMS transactions to support this change are 

provided in Enclosure 1. Detailed DLMS procedures for establishing and maintaining asset 

visibility by serial number and UII, (when available), are provided in the multiple chapter 

updates in Enclosure 2.
Attachment, ADC 1198

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(a) Prepositioned Materiel Receipt. Follow the established procedures 

from DLM 4000.25, Volume 2, Chapter 12 and provide a DLMS 527D Prepositioned Materiel 

Receipt (PMR) transaction to each intended storage activity. Do not include UIIs and/or serial 

numbers in the PMR transaction. (No Change)

(b) Advance Shipment Notice (From Procurement). Existing procedures 

require the procuring DOD Component to ensure the applicable clause requiring the vendor to 

provide IUID information in accordance with Defense Federal Acquisition Regulations 

Supplement (DFARS), “Item Unique Identification” clause is included in the contract. Existing 

procedures require contractors/vendors to submit IUID information to the Wide Area Workflow 

e-Business Suite – Invoicing, Receipt, Acceptance, and Property Transfer (iRAPT) in accordance 

with the iRAPT Implementation Guides for the 856, Ship Notice/Manifest; 857 Shipment and 

Billing Notice; direct online input; or another comparable information exchange method 

supported by iRAPT. DLMS-compliant receiving activities must coordinate with iRAPT for 

dissemination of the vendor shipment information to the receiving system using the DLMS 856 

ASN, including UIIs and serial numbers. (No changes)

(c) Acceptance Report. When acceptance at origin is applicable, the 

DLMS 856 or comparable 856 transactions, forwarded to the procuring and receiving activity, 

will contain accepted IUID and serial number information. When acceptance at destination is 

applicable, the receiving system must report acceptance, including serial numbers and UIIs 

(when available), using the DLMS 861, Acceptance Report, or use direct input to iRAPT. 

Responsibility for Government acceptance may also be contractually assigned to an alternative 

organization which may use the DLMS 861 or direct input to iRAPT for acceptance reporting. 

iRAPT will extract the IUID information for all Government accepted IUID items and use to 

establish the birth record in the IUID Registry. Additional information and guidance on the 

IUID registry can be found on the UID Website http://www.acq.osd.mil/dpap/pdi/uid.

(d) Requisitioning. Requisitioning will be in accordance with the 

procedures contained in DLM 4000.25, Volume 2, Chapter 4. No requirement has been 

identified to requisition materiel by UII and/or serial number. Therefore, UIIs and/or serial 

number procedures are not applicable to the following DLMS transactions; 511R Requisition, 

511M Requisition Modification, or 940R transactions used as a Materiel Release Order, 

Redistribution Order, or Disposal Release Order. With the exception of the process documented 

in DLM 4000.25, Volume 2, Chapter 19, C19.13 supporting the intra-Air Force usage in the 

Nuclear Weapons Related Materiel (NWRM) Positive Inventory Control (PIC) Fusion Module 

UIT Registry, the 870S Supply Status will not include UIIs and/or serial numbers.

(e) Shipment Status / Shipment Status Materiel Returns. DLM 4000.25, 

Volume 2, Chapter 5 contains procedures to prepare and report shipment status information 

using the DLMS 856S transaction. Chapter 5 also includes procedures to prepare and report 

shipment status for materiel returns using the DLMS 856R. Under DOD IUID Supply Policy for 

accountability and management of capital equipment, capital equipment candidates require 

serialization data visibility. 

1. Shipment Status. Shipping activities will prepare the DLMS 

856S Shipment Status using the serial number and include the UII when available. The serial 

number, and UII (when available), will be entered into the DLMS 856S by the shipping 

activities for all capital equipment and capital equipment candidate items. The shipping 
Attachment, ADC 1198

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activity will use the DLMS 856S to report shipment status with serial numbers and UIIs (when 

available) that are selected for shipment, to the receiving DOD Component activity. 

2. Shipment Status Materiel Returns. Activities shipping returns 

capital equipment and capital equipment candidates, must prepare the DLMS 856R Shipment 

Status Materiel Returns using the serial number and include the UII (when available). Refer to 

ADC 1071 for detailed procedures. (Reference 3.j.)

3. Processing Shipment status and Shipment Status Materiel 

Returns. The receiving DOD Component will create the serialization data in its AIS as a duein based on the shipment status and when the items are actually received, confirm that the 

serial numbers and UIIs reported as shipped by the DLMS 856S or 856R. Mismatched serial 

numbers and UIIs will be resolved following the procedures in DLM 4000.25, Volume 2, 

Chapters 6, 17, and the additive procedures under discrepancy reporting processes below. The 

change to existing procedures is the modified language to require the serial number for capital 

equipment and the UII (when available).

(f) Storage Activity Materiel Release Advice/Confirmation and Issue. In 

support of FIAR and, DODI 5000.64, Accountability and Management of DOD Equipment and 

Other Accountable Property, May 19, 2011, compliance, capital equipment candidates require

serialization data visibility. Issue transactions will require the serial number and include the UII 

(when available).

1. Issues. For issues, the shipping activity will confirm materiel 

release to the owner and report shipped serial numbers and UIIs for capital equipment 

candidate items. The storage activity will transmit a DLMS 867I Issue and/or a Materiel 

Release Confirmation (DLMS 945A) using only the 4030 version) in accordance with the 

DLM 4000.25, Volume 2, Chapter 4 procedures with the inclusion of the serial numbers and 

UIIs shipped.

2. The shipping activity will report serial numbers and UIIs 

(when available) to the owner, for shipment of items to demilitarization and/or disposal of 

capital equipment candidate items. The storage activity will include the serial numbers and 

UIIs (when available) on the DLMS 945A Materiel Release Confirmation and/or DLMS 867I 

Issue.

3. The AIS supporting the owner will use the 945A Materiel 

Release Confirmation and/or 867I Issue to record which serial numbers and UIIs (when 

available) have been shipped and decrement those serial numbers and UIIs from their 

accountable property system of record as no longer available and in storage at that location.

4. DLMS Retail Transportation and Supply Receipt and 

Acknowledgement Interchange (See DLM 4000.25 Volume 3, Chapter 2). The transportation 

office will perpetuate the serial numbers and UIIs with the associated transportation control 

number (TCN) in the Materiel Release Confirmation (Distribution Code 111). This data 

content will be used by the supply activity to perpetuate this information to the Shipment 

Status.
Attachment, ADC 1198

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(g) Materiel Returns, Redistribution of Materiel, Directed 

Discrepant/Deficient Materiel Returns and Retrograde Returns

1. Redistribution of Materiel. In support of FIAR, and DODI 

5000.64, Accountability and Management of DOD Equipment and Other Accountable 

Property, May 19, 2011, capital equipment candidates require serialization data (serial number 

and UII (when available)) to provide asset visibility. Activities responding to redistribution 

orders for capital equipment candidate items must prepare shipment status transactions using 

the serial number and include the UII (when available).

2. Receipt of Materiel Returns or Redistributed Materiel. In 

support of FIAR compliance capital equipment candidates require serialization data visibility. 

DLA/DSS activities receiving returns or redistributed items that are capital equipment 

candidates will prepare receipt transactions using the serial number and include the UII (when 

available).

(h) Receipt Discrepancies. In support of FIAR and DODI 5000.64,

Accountability and Management of DOD Equipment and Other Accountable Property, May 19, 

2011, capital equipment candidates, requires serialization data visibility (serial number and UII 

(when available)). In addition to requiring serialization data for capital equipment candidates, 

this change updates DLM 4000.25, Volume 2, Chapter 17 Supply Discrepancy Reporting, to 

include item identification of materiel received in other that the original condition shipped. This 

adds to what was originally changed by ADC 1030. 

1. Supply Discrepancy Reporting (SDR). SDRs reporting 

discrepant receipt of items managed under capital equipment procedures could include 

shortages, overages, discrepant condition, missing/mismatched serial number/UIIs with no 

quantity discrepancy, and wrong item receipt. When received serial numbers and UIIs do not 

match accompanying documentation or electronic ASN, the receiving activity will record the 

actual quantity and serial numbers/UIIs received, and notify the shipping activity or inventory 

control point (ICP)/IMM, as applicable, of the discrepancy. If a discrepancy applies to a 

portion of the items then serial numbers/UIIs would be required for those items in error. For 

example, if ten items are shipped as Supply Condition Code A and at receipt all are identified 

as Supply Condition Code B, no serial numbers/UIIs are required in the SDR because as that 

information is already known to the relevant parties. However, if only five are received in 

Supply Condition Code A then the serial numbers/UIIs for the five with Condition Code B will 

be transmitted in the SDR. WebSDR will ensure the owner/manager has visibility of SDRs 

sent to the shipper. The receiving activity will submit an SDR using the procedures in DLM 

4000.25, Volume 2, Chapter 17 showing the appropriate discrepancy code for quantity and 

IUID discrepancies under existing SDR procedures. 

Staffing Note 2: Army identified a requirement cited above to identify serialization data for 

discrepant condition code. Components should re-evaluate the procedures developed under 

ADC 1030 and ensure consistency with this added requirement

2. Product Quality Deficiency Reports. The 842P PQDR 

transaction is not addressed in this ADC because the 842P PQDR already carries both the serial 

number and UII (when available).

3. DOD Stock Readiness Program. Under the Stock Readiness 

program, the DoD requires uniform care of supplies, including the inspection and reporting of 
Attachment, ADC 1198

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materiel condition and serviceability, and the scheduling, controlling, and reporting of packaging 

and other cost reimbursable actions supporting care of supplies in storage (COSIS). For capital 

equipment and capital equipment candidates, the distribution center will report storage quality 

issues requiring COSIS work to the materiel owner via the storage quality control report. 

Include the serial numbers and UIIs (when available) for processing in accordance with DoD 

Component stock readiness policy using storage quality control report and storage quality control 

report reply.

(i) Reintroduction of an IUID item previously shipped outside the Control 

of the Department of Defense. In support of FIAR compliance capital equipment candidates 

require serialization data visibility when such items previously shipped outside DOD control are

reintroduced to DOD control. In this case the receiving activity will report the receipt including 

serial number(s) and UII(s) (when available) to the owner. The receiving activity will submit the 

receipt using DLMS 527R Receipt transaction including the serial numbers and UII(s) (when 

available). The receiving activity will update the IUID registry using existing IUID registry 

procedures.

(j) Inventory Adjustments. The inventory adjustment function 

encompasses increases, decreases, or dual adjustments. In support of FIAR compliance capital 

equipment candidates require serialization data visibility (serial number and UII (when 

available)). The existing DLM 4000.25, Volume 2, Chapter 7 Inventory Adjustment procedures 

for processing and reporting of inventory adjustments apply with the following additions:

1. For capital equipment candidates inventory adjustment gains, 

losses, or dual adjustments, the serial number and UII (when available) will be included in the 

DLMS 947I Inventory Adjustment. Inventory adjustments due solely for the need to correct 

serial number and/or UIIs will always be for a quantity of 1.

2. Capital equipment candidate serial number and UII (if 

available) adjustments will identify the Adjustment Reason Code AQ in the DLMS 947I, ASC 

X12 warehouse adjustment item detail segment (2/W1901/0200) Quantity or Status 

Adjustment Reason Code. Paragraph 4.d. contains the addition to the DLM 4000.25, Chapter 

7, Quantity or Status Adjustment Reason Code Table C7.T1 and an additional new Status 

Adjustment Reason Code “AQ – Inventory Adjustment (UII and/or serial number mismatch). 

Gain, loss or dual adjustment resulting solely from UII and/or serial number mismatch”.

(k) Research of Potential or Actual Inventory Adjustments (Physical 

Inventory) (DLMS 947I with Quantity or Status Adjustment Reason Code AQ). No specific 

changes are identified for management of capital equipment candidates, however, the following 

comments about the existing procedures are noted: 

1. DOD Components will ensure potential or actual inventory 

adjustments for capital equipment candidate with a DLMS 947I with Quantity or Status 

Adjustment Reason Code AQ are researched in accordance with the existing procedures in 

DLM 4000.25, Volume 2, Chapter 6, paragraph C6.4. 

2. Capital equipment candidate discrepancies on serial number 

and UII (when available), due to their dollar values, will always require the most demanding 

research requirements set forth in DLM 4000.25, Volume 2, Chapter 6. Table C6.T3. 

Minimum Research Requirements for Potential or Actual Physical Inventory Adjustments.
Attachment, ADC 1198

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(l) Physical Inventory Processes. In support of FIAR compliance, capital 

equipment candidates require serialization data visibility. The procedures for processing and 

reporting transactions to maintain Physical Inventory Control in DLM 4000.25, Volume 2, 

Chapter 6 apply with the following additions:

1. The 846P used as a transaction history request, response to 

transaction history request (no history available), response to physical inventory request, and 

end of day transaction count will not contain serial number and UII. However, when the owner 

initiates a physical inventory request for capital equipment candidate to assist in resolving 

discrepancies where the only difference between the owner’s records and the storage activity 

records is on serial number and UII, the transaction will contain Type of Physical Inventory 

Code B – (Special inventory, due solely to UII and/or serial number mismatches between 

owner and storage activity records). This is a new code being added in DLM 4000.25-2, 

Appendix 2.2. by this change. Owners will initiate a physical inventory due to mismatched 

UII(s) and/or serial numbers when a mismatched condition on UII and/or serial number is 

identified between its records and transactions received. Initiating a physical inventory due to 

Mismatched UII(s) and/or serial numbers can become necessary due to: 

a. Owner/manager processing of a materiel release 

confirmation (DLMS 945A) from a storage activity where the owner does not have a record of 

that serial number and UII (when available) or the owner/manager records have that serial 

number and UII located at other than the storage activity reporting the release/issue of the item. 

In support of FIAR compliance, capital equipment candidates, requiring serialization data 

visibility, either of these conditions will necessitate a complete inventory (initiated by the 

owner/manager) be taken at all storage locations for all owners and supply condition codes. For 

serial number/UII mismatch, the storage activity and the owner will need to collaborate to ensure 

appropriate steps are taken to resolve the discrepancy. In support of FIAR compliance, capital 

equipment candidates, requiring serialization data visibility, it may be necessary to conduct a

complete inventory (initiated by the owner/manager) at all storage locations for all owners and 

supply condition codes. DOD Components and storage activities will need to develop internal 

procedures to initiate the appropriate physical inventory at one or more storage activities for the 

affected NSN.

Staffing Note 3: Components MUST review this section carefully for impact.

b. Owner/manager processing a receipt from customers, 

issues or inventory adjustments from storage activities where there is a mismatch on serial 

number and UII (when available) between the owner records and the storage activity transactions 

reporting which serial number and UII (when available) was shipped. At a minimum, this will 

require an inventory and research to resolve the discrepancy.

c. Owner/manager processing Location Reconciliation 

History Transactions (DLMS 846R) resulting from End-of Day processing or an owner initiated 

location reconciliation request where there is a mismatch on serial number and UII (when 

available) between the owner records and the storage activity transactions. The history 

transaction for capital equipment and capital equipment candidates will contain the serial number 

and UII (when available). 
Attachment, ADC 1198

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(m) Storage Activity will be required to have access to FLIS unit price 

and class of materiel to make a determination of capital equipment candidates.

Staffing Note 4: DLA/DSS review and respond whether DSS will interface with FLIS for each 

(receipt) transaction to determine capital equipment applicability or go to a lookup table 

developed for this purpose. DLA advises this will be determined during the design phase of the 

request for change (RFC) after the ADC is published.

e. Revisions to DLM 4000.25 Manuals:

(1) Revise the following DLMS implementation conventions (IC) as shown in 

Enclosure 1: 527R Receipt, 842A/W SDR, 842S/Q Storage Quality Control Report, 846R 

Location Reconciliation Request, 856R (version 4030) Shipment Status Materiel Returns, 856S 

Shipment Status, 867I Issue, 945A (version 4030) Materiel Release Advice, and 947I (version 

4030) Inventory Adjustment.

(2) Revise DLM 4000.25, DLMS Volume 1, Concepts and Procedures,

Appendix, 1, References, to add the following document reference – DODI 5000.64, 

“Accountability and Management of DoD Equipment and Other Accountable Property,” May 19, 

2011.

(3) Revise DLM 4000.25, DLMS, Volume 1, Concepts and Procedures, 

Appendix 2, Terms and Definitions, to add the following definitions:

ACCOUNTABLE PROPERTY SYSTEM OF RECORD. The Government system used to 

control and manage accountable property records; a subset of existing organizational 

processes related to the lifecycle management of property; the system that is integrated with 

the core financial system. (Source: DODI 5000.64, May 19, 2011)

CAPITAL EQUIPMENT. Capital equipment is defined as tangible personal property end 

items that: (1) have an acquisition cost at or above the current capitalization threshold, with a 

useful service life of two or more years; (2) are functionally complete for their intended 

purpose, durable, and nonexpendable; (3) are not intended for sale in the ordinary course of 

business; (4) do not ordinarily lose their identity or become a component part of another 

article when put into use; and (5) are available for the use by the reporting entity for its 

intended purpose (Reference DoDI 5000.64). Source of definition: Guidelines for Registering 

Government Serialization, Type Designation and Ownership of Major End Items, Assemblies 

and Subassemblies and Capital Equipment in the IUID Registry, Version 1.1 October 15, 

2007.

CAPITAL EQUIPMENT CANDIDATE. Capital equipment candidate end items have the 

following characteristics; (1) have a FLIS IUID Indicator (Y); (2) are within Classes of 

Supply II, VII, and VIII; and (3) have a current Unit Price recorded in the FLIS of at least 

$100,000. Not all capital equipment candidate items will ultimately be reported on financial 

accountability statements due to the decision to implement uniform serialization across a 

NIIN and to not track actual acquisition cost of each equipment in supply chain AISs. 

However, all capital equipment candidate items will be subject to serialized data visibility 

procedures. 
Attachment, ADC 1198

Page 11

(4) Revise DLM 4000.25, DLMS Volume 1, Concepts and Procedures, Appendix 

3, Acronyms and Abbreviations to add new acronym used in the DLMS chapter updates:

APSR – Accountable Property System of Record

FIAR – Financial Improvement and Audit Readiness 

(5) Revise DLM 4000.25, DLMS, Volume 2, Supply Standards and Procedures,

to add additional text to the DLMS chapters as shown in Enclosure 2.

(6) Revise DLM 4000.25, DLMS Volume 2, Supply Standards and Procedures, 

Chapter 7, Inventory Adjustments to update Table C7.T1. Quantity or Status Adjustment Reason 

Code with a new code:

Table C7.T1. DLSS DIC/DLMS Quantity Or Status Adjustment Reason Code Correlation

W1901 Quantity 

or Status 

Adjustment 

Reason Code

Explanation

Corresponding

MILSTRAP 

legacy DIC

AQ Inventory Adjustment (UII and/or serial number 

mismatch). Gain, loss or dual adjustment resulting 

solely from UII and/or serial number mismatch

Not Applicable to

Legacy

MILSTRAP

(7) Revise DLM 4000.25-2, MILSTRAP, Appendix 2.2, Type of Physical 

Inventory/Transaction History Codes, and corresponding Logistics Data Resources Management 

System (LOGDRMS) Data Element ID 1270 Qualifier FC, to add a new code B: 

CODE DEFINITION

A through B Reserved for future DoD assignment

B Special inventory due solely to UII and/or serial number mismatches between 

owner and storage activity records.

C Special Inventory, all supply condition codes (SCCs). Initiated by the storage 

activity in support of inventory accuracy improvements initiative.

f. Proposed Transaction Flow: No changes to the existing transaction flows are 

planned. This change addresses inclusion of serial numbers, and UIIs (when available), into the 

existing logistics transactions noted herein for the capital equipment requirements identified.

g. Alternatives:

(1) Services stop storing Service owned capital equipment in DLA Distribution 

Centers.
Attachment, ADC 1198

Page 12

5. REASON FOR CHANGE:

a. FIAR and DODI 5000.64, Accountability and Management of DOD Equipment and 

Other Accountable Property, May 19, 2011, Compliance. All applicable DOD activities are 

responsible for appropriate financial accounting of capital equipment in accordance with the 

DOD FMR, Volume 4, Chapter 6, and the latest guidance issued from the USD(AT&L) and 

OSD(Comptroller) in September 2013 (Reference 3.e.). Further, in compliance with public law 

(NDAA 2010, section 1003, (Reference 3.f.)), all DOD activities are to assert full financial 

statement audit readiness by the end of Fiscal Year 2017. The latter requires the DOD entities 

support a full and accurate accounting of their capital equipment at the unique item level of detail

(serial number/UII), regardless of their physical location.

b. There was no requirement for DLA to provide capital equipment visibility (serial 

number and UII (when available)) of FLIS IUID Indicator Y Service owned assets stored at

DLA. This ADC identifies and establishes the procedures for visibility of capital equipment in 

support of FIAR and DODI 5000.64, Accountability and Management of DOD Equipment and 

Other Accountable Property, May 19, 2011, Compliance.

6. ADVANTAGES AND DISADVANTAGES:

a. Advantages: 

(1) Provides Services with the unique capital equipment candidate visibility 

required to meet FIAR requirements (i.e. auditable).

(2) Serial number Supply Discrepancy Reports will be generated at initial receipt, 

thereby, eliminating multiple discrepancies by multiple recipients further down in the supply 

chain.

b. Disadvantages: The approved methodology for identifying capital equipment 

candidates at the NIIN level results in a potential to track non-capital asset NIINS serially. 

Using class of supply and FLIS standard unit price will cast a wider net of capital equipment 

candidates than actually required by the Comptroller Capital Equipment Reporting requirement. 

The wider net will potentially require resources to be expended to track capital equipment 

candidates (that are not actually capital equipment) at the serial number level; the Services will 

be charged for the resources expended. However, as per DoD policy, serialization/UII 

determination is made at the NIIN level, and an attempt to only track Capital Assets serially as 

opposed to Capital Asset candidate NIINs serially would result in DSS having to track some 

items within a NIIN serially and other items within a NIIN by condition code/Qty. An 

acceptable method to accomplish this could not be identified. 

7. ASSUMPTIONS USED OR WILL BE USED IN THE CHANGE OR NEW 

DEVELOPMENT:

a. Prior to this ADC, DLA did not have a requirement to provide Serial number/UII 

visibility of all FLIS IUID Indicator Y Service owned assets stored at DLA. 

b. Capital equipment “candidate”. – Capital equipment is determined based on date and 

individual acquisition cost. This definition is a challenge in the logistics community as it allows 

for capital and non-capital instances within a single NIIN. Within logistics, the serialization 
Attachment, ADC 1198

Page 13

determination is made at the NIIN level. Since the entire population of assets within the NIIN 

must be serialized, the term capital equipment “candidate” is used to identify NIINs that may 

contain an asset that meets a capital equipment threshold. From a transactional viewpoint, all 

assets within the NIIN will require the same level of reporting. All information will be sent to 

the Components. The Component financial systems will determine which instances are capital 

equipment for the purposes of FIAR compliance. For DLA Distribution, the $100K threshold 

will be based on FLIS unit price and will apply to all assets within a given NIIN. 

c. These procedures only apply to assets with a NIIN. The Services do not store nonstandard capital equipment (i.e., capital equipment candidates without NSNs assigned) at DLA 

Distribution Centers.

d. DLA and the Services will develop MOUs for conducting the initial inventory (i.e. 

recording, creation and application of any required serial numbers and UIIs to bare item or 

packaging) of capital equipment candidates at DLA warehouses.

8. ADDITIONAL COMMENTS TO CONSIDER:

a. DOD Components must use the ASC X12 Version Release 4030 for the DLMS 856R, 

945A and 947I ICs for IUID implementations.

b. The use of AIT will greatly reduce or eliminate errors associated with the manual 

capture of serial numbers (to include human read errors) that could lead mismatches between 

transactions, documentation, and Component property records resulting in SDRs.

c. This ADC does not apply to the Disposition Services turn in receipt 

acknowledgement and the materiel receipt acknowledgement. Mismatches on the serial number 

or UII would be addressed in the discrepancy process.

9. ADDITIONAL FUNCTIONAL REQUIREMENT:

a. DLA is reviewing requirements/constraints for conveying the DLA Distribution 

Center’s cost of managing capital equipment candidate inventory by serial number and UII to the 

materiel owner. DLA will provide their proposed methodology once determined.

b. An additional DLMS change will be required for the Inventory Control Effectiveness

(ICE) Report – General Supplies DD Form 2338-2 (Report Control Symbol (RCS): DD-AT&L 

935) and procedures that will include a new code to identify capital equipment items and to 

separately identify inventory adjustments resulting solely from the need to correct mismatches on 

UII and/or serial number. This is necessary due to the inherent value of capital equipment 

adjustments necessary to correct UII and/or serial number mismatched conditions that could 

adversely affect what is currently reported in the ICE Report. DLMSO will develop a separate 

PDC to address the ICE Report requirement after release of ADC 1198. .

10. ESTIMATED TIME LINE/IMPLEMENTATION TARGET: June 1, 2016 and no 

later than September 30, 2016. The Army requires implementation in DSS by September 30, 

2016 to establish and maintain serialized data visibility of capital equipment, as required by the 

Army's valuation assertion schedule and in support of the OUSD-C FIAR plan. In response to 

the PDC, DLA estimates it will take 1.5 years before it is fully functional with these changes.
Attachment, ADC 1198

Page 14

11. ESTIMATED SAVINGS/COST AVOIDANCE ASSOCIATED WITH 

IMPLEMENTATION OF THIS CHANGE: This change will enable the DLMS compliant 

Services to meet 2017 FIAR requirements. The implementation of this change is not intended as 

attempt to save or avoid costs. 

12. IMPACT:

a. Cost to the Services for the DLA Distribution Centers to provide serialized data 

visibility for capital equipment candidates (i.e.by serial number and UII (when available)) is 

unknown at this time.

b. Cost to DLA. The DLA estimate to implement and maintain the requirements in 

ADC 1198 to support all Services is $12 million and will take 1.5 years before it is fully 

functional. System changes for EBS and DSS account for $1.2 million. Based on capital assets 

currently in stock, DLA estimates it will cost $4.4 million initial implementation and $6.4 

million to sustain it for 4 years.

c. DLA Distribution will be required to conduct an initial complete “Wall to Wall”

inventory of capital equipment candidate items based on the criteria identified in this approved 

change and record serial number and UII data elements to update DLA Distribution and owning 

Service inventory records.

d. Care of Supplies in Storage. For capital equipment candidate items requiring 

serialized data visibility, the distribution center will report storage quality issues requiring care of

supplies in storage (COSIS) work to the materiel owner via the Storage Quality Control Report, 

including the serial numbers and UIIs (when available), for approval in accordance with DOD

Component "Stock Readiness" Policy using DLMS 842SQ Storage Quality Control Report and 

DLMS 842S/R Storage Quality Control Report Reply, (refer to DLM 4000.25, DLMS Manual, 

Volume 2, Chapter 19, paragraph C19.24), (Reference 3.b.)).

e. DLA Disposition Services. DLA Disposition Services is excluded from these changes 

and a subsequent PDC will address DLA Disposition Services procedures for capital equipment.

f. New DLMS Data Elements: None identified

g. Changes to DLMS Data Elements:

(1) Quantity or Status Adjustment Reason Code, ASC X12 Data Element ID 

181, Quantity or Status Adjustment Reason Code:

(b) DLMSO established new local code value in LOGDRMS for Data 

Element ID 181: AQ - Unique Item Identifier (UII)/Serial Number Mismatch. 

(c) DLMSO will submit a code maintenance request to establish a new 

value for ASC X12 Data Element ID 181 Quantity or Status Adjustment Reason Code: AQ –

Unique Item Identifier (UII)/Serial Number Mismatch.

(2) Type of Physical Inventory/Transaction History Code. ASC X12 Data 

Element ID 1270, Qualifier “FC – Type of Physical Inventory or Transaction History Code. Add 

new code value B to the existing Type of Physical Inventory/Transaction History code list. 
Attachment, ADC 1198

Page 15

(Refer to DLM 4000.25-2, MILSTRAP, Appendix 2.2, Type of Physical Inventory/Transaction 

History Codes.)

B – Special inventory due solely to UII and/or serial number mismatches 

between owner and storage activity records.

h. Automated Information Systems (AIS): DLA Distribution and Service AISs 

receiving the DLMS transactions cited in this change with serialization data to include the serial 

number and UII (when available) for Service owned capital equipment and capital equipment 

candidates stored at DLA Distribution Centers must recognize and use the data (e.g., Army LMP

system).

i. Transaction Services:

(1) Modify mapping to incorporate the new Quantity or Status Adjustment 

Reason Code AQ – Inventory Adjustment (UII and/or serial number mismatch). Gain, loss, or 

dual adjustment resulting solely from UII and/or serial number mismatch in the 947I (4030) 

Inventory Adjustment, 2/W1901/0200. 

(2) There may be a Transaction Services impact due to increased size and volume 

of transactions resulting from this change.

j. Non-DLM 4000.25 Series Publications:

(1) No changes were identified for other DOD level publications. 

(2) Component level publications should be reviewed and updated as necessary.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 1

Enclosure 1 to ADC 1198

DLMS Implementation Convention (IC) Change Tables

Changes identified by bold italics or double strike-through.

A. 527R Receipt, Inquiry Response and MRA

# Location DLMS 527R Receipt Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/REF/250 Revise Segment Level notes as follows:

1. At this time, the 2/REF/250 loop is not authorized for use to 

provide item unique identification (IUID) or Unique Item 

Tracking (UIT) information except as noted. Use is authorized 

for DLA Distribution Center receipt processing to identify the 

UII for reparable items returned to DoD inventory by repair 

contractors (2/LIN01/010 Code E); and for receipts for UIT 

programs items for Navy Depot Level Reparable and Positive 

Inventory Control (PIC) Nuclear Weapon Related Materiel 

(NWRM) (UIT Designators AAD and AAJ respectively); and 

for DLA Disposition Services use with receipt and TRA 

transactions for the UIT program for DoD SA/LW Serialization 

Program (UIT Designator AAA). Also authorized for use with 

receipts under DoD IUID policy for accountability and 

management of capital equipment. A PDC must be submitted 

documenting requirement and procedures before using this 

transaction for IUID or UIT for any other purpose.

2. This transaction will support item identification based upon 

the UII or the serial number. Data elements associated with the 

UII may be identified separately. Use the appropriate data 

elements to satisfy the desired functionality.

3. Capital equipment candidates require serialization data 

visibility. Prepare receipts using the serial number and

include the UII (when available). Refer to ADC 1198.

4. When both UII or serial number and batch/lot number are 

required for the item, enter the UII or serial number in 

2/REF/250 and enter the batch/lot number in 2/N9/270. 

5. The entire 2/REF/250 loop is a DLMS enhancement. See 

introductory DLMS note 5a.

Documents capital 

equipment requirement.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 2

# Location DLMS 527R Receipt Reason

3. 2/REF01/250 Revise qualifiers SE and U3::

SE Serial Number

DLMS Note: 

1. Use to identify the serial number (when code U3 is not used). 

Use this qualifier for unique item tracking based upon the serial 

number.

2. Commercial Asset Visibility (CAV) uses in receipts to 

identify the serial number of the repair item.

3. Authorized DLMS enhancement for DLA Disposition 

Services use in receipt, historical receipt, and TRA to identify 

the serial number for Small Arms/Light Weapons (SA/LW) or 

industrial plant equipment. For the Receipt, the serial number 

is used by both the DLA Disposition Services Field Offices and 

the DLA Disposition Services ICP. For the TRA, DLA

Disposition Services Field Office provides the serial number to 

the TRA recipient. Refer to ADC 442 and ADC 1111.

4. Authorized for capital equipment candidates.

5. DLMS enhancement. See introductory DLMS note 5a.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use to identify the UII. Place UII value in REF03. The UII 

may not exceed 50 characters in accordance with IUID Policy. 

A data maintenance action was approved in version 5020. The 

approved code/name is "UII - Department of Defense Unique 

Item Identifier.

2. Authorized DLMS enhancement for DLA Disposition 

Services use in receipt, historical receipt, and TRA to identify 

the UII for SA/LW or industrial plant equipment. For the 

Receipt, the UII is for use by both the DLA Disposition 

Services Field Offices and the DLA Disposition Services ICP. 

For the TRA, DLA Disposition Services Field Office provides 

the UII to the TRA recipient. Refer to ADC 442 and ADC 

1111.

3. Authorized DLMS enhancement for DLA Distribution 

Center receipt processing to identify the UII for reparable items 

returned to DoD inventory by repair contractors. Refer to ADC 

1042.

4. Authorized for capital equipment candidates. Refer to 

ADC 1198.

5. Authorized DLMS migration enhancement. See DLMS 

introductory note 5g.

Detailed capital 

equipment requirement 

addressed in the 

segment level note.

4. 2/N901/270 No change to the following:

SE Serial Number

DLMS Note:

Use to identify the serial number (when code U3 is used in 

REF01).

Provided for context.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 3

B. 842A/W Standard SDR, Follow-Up, Correction, Cancellation & Reconciliation Request

# Location DLMS 842A/W Standard SDR, Follow-up, Correction, 

Cancellation & Reconciliation Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/HL01/0100 Revise DLMS note at data element level:

Hierarchical ID Number

DLMS Note: Cite numeric 1 to satisfy ANSI syntax 

requirement. In the first 2/HL/0100 loop iteration,

cite numeric 1. In each subsequent loop iteration,

increase incrementally by 1.

Administrative update 

for clarification of data 

mapping requirements 

for IUID. 

3. 2/HL03/0100 Revise DLMS note for existing Code I:

I Item

DLMS Note:

1. Use to identify IUID data consistent with IUID data 

requirements. The IUID data is carried in the NCD and REF,

and N1 segments; the NCD segment is required by ANSI 

syntax; and no other segments are used in the IUID loop. Must

use a separate IUID loop for each item. Skip this level when 

not applicable. The UII value and some of the associated data 

elements are DLMS enhancements.

2. The IUID loop is an authorized DLMS enhancement; 

refer to introductory DLMS Note 5 on the IC cover page. 

Administrative update 

for clarification of data 

mapping requirements 

for IUID.

4. 2/NCD/2300 Revise Segment Level DLMS notes as follows:

DLMS Note:

1. Begin a new Must use one NCD loop for in each IUID loop. 

Use a new IUID loop for each item. The UII value and some 

of the associated data elements are future DLMS enhancements 

and require coordination prior to use.

2. The IUID content is an authorized DLMS enhancement; 

refer to introductory DLMS Note 5 on the IC cover page. 

Administrative update 

for clarification of data 

mapping requirements 

for IUID. 

5. 2/NCD03/2300 Revise DLMS notes at the data element level as follows:

Assigned Identification

DLMS Note:

1. Use as a counter to satisfy ANSI syntax. Cite numeric 1.

EXCEPT where additional NCD loops are used to report 

multiple missing component parts or when providing unique 

identification of discrepant items. In these instances, increase 

incrementally by 1 for each missing component or uniquely 

identified item.

2. When providing item unique identification due to a 

mismatch (including shortage/overage) resulting from 

comparison between shipping notice, due-in, or documentation, 

and the packaging or item, follow the numeric counter by an

indicator to distinguish the item(s) received from the 

Administrative update 

for clarification of data 

mapping requirements 

for IUID. Removes 

obsolete information.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 4

# Location DLMS 842A/W Standard SDR, Follow-up, Correction, 

Cancellation & Reconciliation Revision

Reason

anticipated item(s) not received. Suffix the counter by the

letter R for items received and N for items not received. See 

ADC 1030.

3. Use of this looping structure to describe multiple missing 

component parts or multiple incorrect items received in 

association with Discrepancy Code W5, Mixed Stock, is 

reserved for future implementation.

6. 2/REF/2600 Revise Segment Level notes as follows:

1. Use in 2/HL/0100 IUID loop to provide IUID information. 

Repeat the REF segment within each IUID loop to identify 

relevant IUID information. 

2. This transaction will support item identification based upon 

the UII or the serial number. Data elements associated with the 

UII may be identified separately. Use the appropriate data 

elements to satisfy the desired functionality.

3. In support of Financial Improvement and Audit Readiness 

(FIAR) compliance, capital equipment candidates require 

serialization data visibility. Submitters must prepare SDRs 

citing the applicable serial number(s) and UIIs (when 

available), when appropriate for the type of discrepancy (e.g., 

wrong item, shortage/overage, receipt in a condition other 

than expected, or a serial number/UII mismatch between the 

item and documentation). Refer to ADC 1198.

Documents capital 

equipment requirement.

7. 2/REF01/2600 No change to the following:

SE Serial Number

DLMS Note: 

1. Use in IUID loop to identify the serial number.

2. The serial number may not exceed 30 characters in 

accordance with IUID policy.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use in IUID loop to identify the UII value. Cite the UII in 

REF03. A data maintenance action was approved in version 

5020. The approved code/name is "UII - Department of 

Defense Unique Item Identifier.

2. The UII may not exceed 50 characters in accordance with 

IUID Policy.

Provided for context.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 5

C. 842S/Q Storage Quality Control Report

# Location DLMS 842S/Q Storage Quality Control Report

Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital Equipment for 

Service Owned Assets Stored at DLA Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/REF/2600 Revise Segment Level notes as follows:

1. Use in 2/HL0100 IUID loop to provide IUID information. 

Use a separate IUID loop for each item. Repeat the REF 

segment within each IUID loop to identify relevant IUID 

information.

2. This transaction will support item identification based upon 

the UII or the serial number. Data elements associated with the 

UII may be identified separately. Use the appropriate data 

elements to satisfy the desired functionality.

3. In support of Financial Improvement and Audit Readiness 

(FIAR) compliance, capital equipment candidates require 

serialization data visibility. Submitters must prepare SQCRs 

citing the applicable serial number(s). Include the UII when 

available. Refer to ADC 1198.

Documents capital 

equipment requirement.

3. 2/REF01/2600 Revise DLMS note associated with existing Qualifier U3:

SE Serial Number

DLMS Note: Use in IUID loop to indicate Serial Number.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note: 1. Use in IUID loop to identify the UII value. 

Cite the UII in REF03. Cite the Serial Number, when 

applicable in REF02. When a lot, batch or other type of 

production run number is included in the UII for uniqueness, 

this number will be cited in REF04.

2. A data maintenance action was approved in version 5020. 

The approved code/name is "UII - Department of Defense 

Unique Item Identifier".

Administrative update 

to remove obsolete 

mapping guidance for 

UII and batch number.

4. 2/REF03/2600 Close REF03 Administrative update

to remove obsolete 

mapping for the UII.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 6

D. 846R, Location Reconciliation Request

# Location DLMS 846R Location Reconciliation 

Request Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/REF/390 Revise Segment Level notes as follows:

1. At this time, the 2/REF/390 loop is not authorized for use to 

provide item unique identification (IUID) or Unique Item 

Tracking (UIT) information, except as noted below for Service 

Ammunition systems and in support of Financial 

Improvement and Audit Readiness (FIAR) compliance for

capital equipment.

2. The entire 2/REF/390 loop is a DLMS enhancement and 

was added Authorized for use with location reconciliation 

request transactions to support Service Ammunition systems 

(i.e., Naval Operational Logistics Support Center (NOLSC) 

Ordnance Information System – Wholesale (OIS-W) 

requirement; Program Manager for Ammunition, Marine Corps 

Systems Command (MARCORSYSCOM) Ordnance 

Information System-Marine Corps (OIS-M); and Warner 

Robins Air Logistics Center Combat Ammunition System 

(CAS). See introductory DLMS notes 4a and 4e. Refer to ADC 

283 and ADC 445.

3. Capital equipment candidates require serialization data 

visibility. Prepare location reconciliation transactions using

the serial number and include the UII when available. Refer 

to ADC 1198.

4. Must use 2/REF/390 loop in Location Reconciliation 

Request transactions when authorized for including unique 

item identifier (UII), serial number, and/or batch/lot number to 

support Service Ammunition systems.

5. This transaction will support item identification based upon 

the UII or the serial number, and provides flexibility to 

accommodate tracking by UII or serial number. This 

transaction also provides for use of a batch/lot number when 

applicable.

6. The 2/REF/390 loop is repeated for each item to be identified 

by UII, serial number or batch/lot number.

7. If UII and serial number, and/or batch/lot number are 

required for the item, enter the UII in REF01, and enter the 

serial number and/or batch/lot number in REF04. If UII is not 

used, enter the serial number in REF01 and enter the batch/lot 

number in REF04. If only batch/lot number is required, enter 

the batch/lot number in REF01.

8. The entire 2/REF/390 loop is a DLMS enhancement. See 

introductory DLMS note 4a.

Documents capital 

equipment requirement.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 7

# Location DLMS 846R Location Reconciliation 

Request Revision

Reason

3. 2/REF01/390 No change to the following:

SE Serial Number

DLMS Note: 

1. Use to identify the serial number when UII is not included. If 

UII is included in addition to the serial number, enter serial 

number in REF04.

2. DLMS enhancement. See introductory DLMS note 4a.

3. Supports Inter-Service Ammunition BG1/BG2 data 

requirement. See introductory DLMS note 4.e. When used 

with Ammunition BG1/BG2 transactions, this qualifier implies 

that the transaction is a BG1 (Serial Number or Lot and Serial

Number Controlled Item Transaction). Refer to ADC 283 and 

ADC 445.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use to identify the UII. Place UII value in REF03. The UII 

may not exceed 50 characters in accordance with IUID Policy. 

An ANSI data maintenance was approved in version 5020. The 

approved code/name is “UII-Department of Defense Unique 

Item Identifier”.

2. Authorized DLMS migration enhancement. See DLMS 

introductory note 4f.

3. In a mixed DLSS/DLMS environment, UII is not used in 

Ammunition BG1/BG2 transactions. Only authorized values 

for Ammunition BG1/BG2 are BT and SE.

Provided for context.

4. 2/REF04-

01/390

No change to the following:

SE Serial Number 

DLMS Note:

1. Use to identify the serial number when UII is entered in 

REF01 and serial number is also used.

2. Not used in Ammunition BG1/BG2 transactions. For 

BG1/BG2 requirement, SE qualifier is only used in the REF01 

segment.

Provided for context.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 8

E. 856R (4030) Shipment Status Materiel Returns

Staffing Note 5: Must use 856R Version 4030 for IUID

# Location DLMS 4030 856R Shipment Status Materiel 

Returns Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/REF/1500 Revise Segment Level notes as follows:

1. Must use in 2/HL/0100 transaction reference number loops 

to identify the document number, fund code and the 

transportation control number with the shipment status 

transaction.

2. Financial accounting data is provided as a DLMS 

enhancement. When implemented, refer to the Accounting 

Classification Appendix for specific entries for the basic 

appropriation number and supplemental accounting 

classification data.

3. This transaction supports unique item identification based 

upon the UII. Shipment status for materiel returns will be 

prepared using both the serial number and UII (when available)

and required by DoD IUID Supply Policy. (see ADC 1071). . 

4. This transaction will support association of the IUID 

information with the RFID tag at the IUID packaging level 

and/or at each higher level of packing which has been tagged. 

5. In support of Financial Improvement and Audit Readiness 

(FIAR) compliance, capital equipment candidates require 

serialization data visibility. Prepare shipment status materiel 

return using the serial number. Include the UII when 

available. Refer to ADC 1198.

Documents capital 

equipment requirement.

3. 2/REF01/1500 No change to the following:

SE Serial Number

DLMS Note: 

1. Use in IUID loop to identify the serial number. See ADC 

1071.

2. DLMS enhancement; see introductory DLMS Note 3f.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use in IUID loop to identify the UII value in REF03. See 

ADC 1071. The UII may not exceed 50 characters in 

accordance with IUID Policy. An ANSI data maintenance 

action was approved in version 5020. The approved code/name 

is "UII - Department of Defense Unique Item Identifier”.

2. DLMS enhancement; see introductory DLMS Note 3f.

Provided for context.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 9

F. 856S (4030) Shipment Status

# Location DLMS 4030 856S Shipment Status 

Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/REF/1500 Revise Segment Level notes as follows:

1. This transaction supports unique item identification based 

upon the UII. Pending full transition to DoD IUID Supply 

Policy using the UII, shipment status will be prepared using 

both the UII and corresponding serial number when available 

and required by DoD IUID Supply Policy. See ADC 1030.

2. This transaction will support association of the IUID 

information with the RFID tag at the IUID packaging level 

and/or at each higher level of packing which has been tagged.

3. Use this segment to comply with the DoD SLOA/Accounting 

Classification. Cost object elements Project Identifier, Funding 

Center Identifier, Functional Area, Cost Element Code, Cost 

Center Identifier, Activity Identifier, and Work Order Number 

are used as appropriate for the system. Refer to ADC 1043.

4. In support of Financial Improvement and Audit Readiness 

(FIAR) compliance, capital equipment candidates require 

serialization data visibility. Prepare shipment status using the 

serial number. Include the UII when available. Refer to 

ADC 1198.

Documents capital 

equipment requirement.

3. 2/REF01/1500 Revise existing qualifiers SE and U3:

SE Serial Number

DLMS Note: 

1. Use in IUID loop to identify the serial number. See ADC 

1030.

2. DLA Distribution must use in shipment of items 

designated as capital equipment candidates. All others 

use in accordance with Component guidance for capital 

equipment. See ADC 1198.

3. DLMS enhancement; see introductory DLMS Note 2f.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use in IUID loop to identify the UII value in REF03. See 

ADC 1030. A data maintenance action was approved in version 

5020. The approved code/name is "UII - Department of 

Defense Unique Item Identifier”.

2. DLA Distribution must use in shipment of items 

designated as capital equipment candidates when the 

item has been marked under IUID policy. All others use 

in accordance with Component guidance for capital 

equipment. See ADC 1198.

3. DLMS enhancement; see introductory DLMS Note 2f.

Documents 

requirement.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 10

G. 867I, Issue

# Location DLMS 867I Issue 

Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the DLMS

Supplement.

2. 2/REF/290 Revise Segment Level notes as follows:

1. Must use t The 2/REF/290 loop is authorized for use in 

Product Transfer and Resale Report (Issue) transactions 

when the item identified is subject to UIT requirements. Also 

authorized in support of Financial Improvement and Audit 

Readiness (FIAR) compliance for accountability and 

management of capital equipment. Refer to ADC 1198

2. This transaction will support item identification based upon 

the UII or the serial number. This transaction also provides 

for use of a batch/lot number, when applicable.

3. In support of FIAR compliance, capital equipment 

candidates require serialization data visibility. Prepare issue 

transactions for capital equipment using the serial number. 

Include the UII when available.

4. This transaction also provides for use of a batch/lot 

number, when applicable.

4. Use multiple iterations of 2/REF/290 segment within the 

2/LX/280 loop, to provide identifying information for an item 

as needed.

Documents capital 

equipment requirement.

3. 2/REF01/290 No change to the following:

SE Serial Number

DLMS Note: 

1. Use to identify the serial number. Place serial number value 

in REF02.

2. DLMS enhancement. See introductory DLMS note 5a.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use to identify the UII. Place UII value in REF03. The UII 

may not exceed 50 characters in accordance with IUID Policy. 

An ANSI data maintenance was approved in version 5020. The 

approved code/name is “UII - Department of Defense Unique 

Item Identifier”.

2. Authorized DLMS migration enhancement. See DLMS 

introductory note 5e.

Provided for context.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 11

H. 945A (4030) Materiel Release Advice 

Staffing Note 6: Must use 945A Version 4030 for IUID.

# Location DLMS 4030 945A Materiel Release Advice 

Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers.

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/N9/1200 Revise Segment Level notes as follows:

1. This segment supports item identification based upon the UII 

or the serial number. 

2. When this message supports the Retail SupplyTransportation Interface (See DLM 4000.25 Volume 3, Chapter 

2), this transaction supports unique item identification (UII). 

Pending full transition to DoD IUID Supply Policy using the 

UII, the Materiel Release Confirmation will be prepared using 

the UII and the corresponding serial number and the batch/lot 

number when available when required by DoD IUID Supply 

Policy. Authorized DLMS enhancement. See ADC 1073.

3. In support of Financial Improvement and Audit Readiness 

(FIAR) compliance, capital equipment candidates require 

serialization data visibility. Prepare Materiel Release 

Confirmation using the serial number. Include the UII when 

available. See ADC 1198.

4. This segment also provides for use of a batch/lot number, 

when applicable.

5. Repeat the N9 segment as needed to identify desired 

characteristics for the specific item.

6. With the exception of the limited implementation authorized 

by ADC 1073 in support of the Retail Supply-Transportation 

Interface, and use with capital equipment as noted, the entire 

2/N9/1200 segment is a DLMS enhancement. See introductory 

DLMS note 4a.

Documents capital 

equipment requirement.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 12

# Location DLMS 4030 945A Materiel Release Advice 

Revision

Reason

3. 2/N901/1200 No change to the following:

SE Serial Number

DLMS Note: 

1. Use to identify the serial number. The serial number may not 

exceed 30 characters in accordance with DoD IUID supply 

policy.

2. Authorized for intra-DLA use between DLA Disposition 

Services and DLA Disposition Field Offices to identify the 

serial number for Small Arms/Light Weapons (SA/LW). 

DLMS enhancement; Refer to ADC 449.

3. Use when this transaction supports the Retail Transportation 

and Supply Receipt and Acknowledgement Interchange SBSS 

interface with CMOS to provide the serial number. Serial 

number may be used alone for legacy items when UII is not 

assigned, otherwise use two occurrences of this segment to 

identify both the serial number and the UII. A maximum of 60 

items may be identified for this interface. See ADC 1073.

U3 Unique Supplier Identification Number (USIN) 

DLMS Note:

1. Use to identify the UII. The UII may not exceed 50 

characters in accordance with DoD IUID Supply Policy.

2. Use when this transaction supports the Retail Transportation 

and Supply Receipt and Acknowledgement Interchange SBSS 

interface with CMOS to provide the UII. A maximum of 60 

items may be identified for this interface. See ADC 1073.

3. A data maintenance action was approved in version 5020. 

The approved code/name is UII -Department of Defense 

Unique Item Identifier.

Provided for context.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 13

I. 947I (4030) Inventory Adjustment 

Staffing Note 7: Must use 947I Version 4030 for IUID.

# Location DLMS 4030 947I Inventory Adjustment

Revision

Reason

1. DLMS 

Introductory 

Notes

Add ADC to DLMS Introductory Notes:

- ADC 1198, Establishing Visibility of Capital 

Equipment for Service Owned Assets Stored at DLA 

Distribution Centers

Identifies DLMS 

Changes included

in the

DLMS Supplement.

2. 2/W1901/0200 Add the following new qualifier AQ with DLMS note:

AQ Unique Item Identifier (UII)/Serial Number Mismatch

DLMS Note: Inventory Adjustment (UII and/or serial number 

mismatch). Gain, loss or dual adjustment resulting solely 

from UII and/or serial number mismatch. At this time a local 

code AQ is established for use in the 947I, version 4030. A 

data maintenance action has been submitted for 

establishment of AQ- Unique Item Identifier (UII)/Serial 

Number Mismatch in a future version 

Needed to support the 

capture of additive 

costs and adjustments 

due to management by 

UII and/or serial 

number.

3. 2/LQ01/1000 Revise existing qualifier FC to remove the DLMS enhancement 

note:

FC Type Physical Inventory or Transaction History Code

DLMS Note:

DLMS enhancement; see introductory DLMS note 4a.

Administrative 

correction. The Type 

Physical Inventory/ 

Transaction History 

Code is not a DLMS 

enhancement for 

Inventory Adjustment. 

The code is in the 

MILSTRAP legacy 

D8_/D9_ format, 

record position 7.

This administrative 

correction also applies 

to 947I version 4010.

4. 2/N9/1600 Revise Segment Level notes as follows:

1. Must use The 2/N9/1600 segment is authorized for use in 

Inventory Adjustment transactions when the item identified is 

subject to UIT Program requirements. Also authorized in 

support of Financial Improvement and Audit Readiness 

(FIAR) compliance for accountability and management of 

capital equipment.

2. This segment supports item identification based upon the UII 

or the serial number. This segment also provides for use of a 

batch/lot number, when applicable.

3. Capital equipment candidates require serialization data 

visibility. Prepare inventory adjustment transactions for 

capital equipment using the serial number. Include the UII

when available.

3 This segment also provides for use of a batch/lot number, 

when applicable.

4. Use multiple iterations of 2/N9/1600 segment within the 

2/LX/1500 loop, to provide identifying information for an item

Documents capital 

equipment requirement.
Enclosure 1, ADC 1198

DLMS IC Updates

Page 14

# Location DLMS 4030 947I Inventory Adjustment

Revision

Reason

as needed.

5. Use in CAV Inventory Adjustment (Condition Code) 

Transactions to identify part numbers required to complete the 

repair/overhaul action and to provide an estimated receipt date 

for each item.

6. DLMS enhancement. See introductory DLMS note 4a.

5. 2/N901/1600 No change to the following:

SE Serial Number

DLMS Note: 

1. Use to identify the serial number. The serial number may not 

exceed 30 characters in accordance with IUID policy.

2. DLMS enhancement. See introductory DLMS note 4a.

3. Authorized for use by CAV.

U3 Unique Supplier Identification Number (USIN)

DLMS Note: 

1. Use to identify the UII. The UII may not exceed 50 

characters in accordance with IUID Policy. An ANSI data 

maintenance was approved in version 5020. The approved 

code/name is “UII-Department of Defense Unique Item 

Identifier”.

2. Authorized DLMS migration enhancement. See DLMS 

introductory note 4e.

Provided for context.
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 1

ENCLOSURE 2 TO ADC 1198

Make the following changes to DLM 4000.25, DLMS Volume 2 

C4. CHAPTER 4. REQUISITIONING

C4.7.16.1.4. Capital Equipment Candidates. In support of Financial 

Improvement and Audit Readiness (FIAR) compliance for accountability and 

management of capital equipment, capital equipment candidates require 

serialization data visibility. Submitters must prepare materiel release 

confirmation citing the applicable serial number(s) and include the UII when 

available.

(Intervening text not shown)

C5. CHAPTER 5. STATUS REPORTING

(Preceding text not shown)

C5.1.1.3. Item Unique Identification.

C.5.1.1.3.1. Shipment Status for NSNs containing an IUID Indicator Yes 

(Y), indicating that DoD Item Unique Identification (IUID) Supply Policy is required, 

must contain the Unique Item Identifier (UII) and/or serial number for each item when 

available. See Section C5.1.3.5 for specific shipment status requirements for IUID.

C5.1.1.3.2. Capital Equipment Candidates. In support of Financial 

Improvement and Audit Readiness (FIAR) compliance for accountability and 

management of capital equipment, capital equipment candidates require 

serialization data visibility. Submitters must prepare materiel release 

confirmation citing the applicable serial number(s) and include the UII when 

available.

(Intervening text not shown)

C5.1.3.1. Preparation of Shipment Status. Shipment status will be provided 

by the shipping activity or the source of supply for direct vendor delivery (contractor 

direct) or in response to a requisition follow-up. The consolidation and containerization 

point (CCP) and other locations performing consolidation subsequent to issuance of 

shipment status may also provide shipment status for the purpose of identifying passive 

RFID. Under DLMS, the shipment status will include enhanced data content and 

support item unique identification (IUID) and intransit visibility requirements as directed 

under DoD policy/procedures (DoDM 4140.01), when available and pending full DLMS 

implementation/modernization. In support of FIAR Compliance for accountability 

and management of capital equipment, capital equipment candidates require 

serialization data visibility. Submitters must prepare shipment status citing the 

applicable serial number(s) and include the UII when available. Shipment status 

will be provided by the DoD shipping activity, the CCP, or by the source of supply using 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 2

the DLMS 856S. Maintenance activities (organic and commercial) will provide shipment 

notification to the receiving activity and other interested parties when materiel is shipped 

to the distribution depot, DLA Disposition Services Field Office, or other designated 

receiving activity per source of supply/inventory control point guidance. This may be 

accomplished using either the DLMS 856S Shipment Status, or the DLMS 856 

Advance Shipment Notice (ASN), provided via Wide Area Work Flow-Receipt and 

Acceptance (WAWF-RA). The DLMS Shipment Status will include asset visibility 

content, such as IUID, and intransit visibility requirements, such as passive RFID and 

the TCN as directed under DoD policy/procedures (DoDM 4140.01). DLMS 

enhancements include, but are not limited to the following:

(Intervening text not shown)

C5.1.3.1.3. Under the DoD IUID Supply Policy, the UII and/or serial 

number (when available) must be added to the shipment status transaction. Serial 

number without the applicable UII may be used only during MILSTRIP/DLMS transition 

and pending implementation of IUID capability. Paragraph C5.1.3.5 contains specific 

procedures to identify the UII in shipment status transactions when the NSN(s) contains 

the IUID Indicator Y denoting that serialized item management is required. Capital 

equipment candidates require serialization data visibility and therefore must cite 

the serial number and include the UII when available. 

(Intervening text not shown)

C5.1.3.2.1.1.8. IUID Data. UII and/or serial numbers (when 

available) must be included for NSNs with an IUID Indicator Y. Capital equipment 

candidates require serialization data visibility and therefore must cite the serial 

number and include the UII when available. Requirements for including the UII in the 

CCP/Consolidation Shipment Status are provided in C5.1.3.5.

(Intervening text not shown)

C5.1.3.3.3. For outbound non-MILSTRIP shipments documented on a 

DD Form 1149, a DLMS 856S will be created. Table C5.T1 lists the minimum data 

elements that must be included in the shipment status message; sources of the data are 

the DD Form 1149 and pRFID tag information. Shipment status applicable to shipment 

of GFP will perpetuate all GFP contract data from the shipping documentation, to 

include the contract number authorizing GFP, and the call/order and CLIN when 

provided. For NSNs containing the IUID Indicator Y, include the UIIs and/or serial 

number(s) for each item when available. Capital equipment candidates require 

serialization data visibility and therefore must cite the serial number and include 

the UII when available.
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 3

Update Table C5.T1. Non-MILSTRIP Shipment Status Message as shown.

Table C5.T1. Non-MILSTRIP Shipment Status Message

ITEM 

#

DATA ELEMENT X12 

REFERENCE

VALUE

21. Unique Item Identifier REF01 U3

REF02 [UII]

22. Serial Number REF01 SE

REF02 [Serial Number]

REF02 [UII]

(Intervening text not shown)

C5.1.3.5.1. UII and/or Serial Number on Shipment Transactions. For 

NSNs that contain the IUID Indicator Y, storage activities (or initial shipping activity) will 

provide the UII and/or serial number, on outbound shipment status using the DLMS 

856S transaction. If the UII is not available provide the serial number if available. The 

long-term end state goal is to rely on the UII only. Table C5.T2 shows the decision 

matrix that applies to scenarios where the UII and/or serial number may not be available 

when the item is being shipped. The overriding vision is that, pending full transition to 

DoD IUID Supply Policy using the UII, processing of outgoing shipments does not stop 

due to lack of a viable UII and/or serial number when the NSN contains an IUID 

Indicator Y. Capital equipment candidates require serialization data visibility and 

therefore must cite the serial number and include the UII when available.

(Intervening text not shown)

C5.1.3.5.5. Scenarios for Including the UII in the Shipment Status. 

Capital equipment candidates require serialization data visibility and therefore 

must cite the serial number and include the UII when available.

C6. CHAPTER 6. PHYSICAL INVENTORY CONTROL

(Intervening text not shown)

C6.13. CAPITAL EQUIPMENT CANDIDATES

C6.13.1. General. This section addresses additional procedures applicable 

to capital equipment candidates.

C6.13.1.1. Capital Equipment Candidates. In support of Financial 

Improvement and Audit Readiness (FIAR) Compliance for accountability and 

management of capital equipment, items identified as capital equipment 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 4

candidates require management and visibility by both the owner and storage 

activity by serial number (and unique item identifier (UII) if available). Owners 

will, within their AISs, have constant knowledge of the physical location 

(DoDAAC/RIC level) of each instance of an item uniquely identified by its serial 

number (and UII if available). The owner of the item will maintain records of 

which storage activity has a particular instance of an item identified by its serial 

number (and UII if available). This requires record keeping by the owner and 

storage activity and the constant exchange of all balance affecting transactions 

between them to ensure that the records of both reflect the correct NSN, storage 

location, owner, supply condition code and serial number (and UII if available). 

Storage activities will maintain locator records by NSN, owner, supply condition 

code and serial number (and UII if available). Owners will maintain records on 

their Accountable Property System of Record (APSR) by NSN, storage activity 

(DoDAAC/RIC level), SCC, and serial number (and UII if available).

C6.13.1.2. Capital equipment candidate items are items having the 

following characteristics; (1) have a FLIS IUID Indicator (Y); (2) are within Classes 

of Supply II, VII, and VIII; and (3) have a current Unit Price recorded in the FLIS of 

at least $100,000. Not all capital equipment candidate items will ultimately be 

reported on financial accountability statements.

C6.13.2 Conduct of Physical Inventories. The transaction history request, 

response to transaction history request when no history is available, physical 

inventory request, response to physical inventory request and end of day 

transaction count will not contain serial numbers or UIIs However, when the 

owner initiates a physical inventory request for a capital equipment candidate 

item to assist in resolving discrepancies where the only difference between the 

owner records and the storage activity records is the serial number (or UII if 

available), the physical inventory request will contain Type of Physical Inventory 

Code B. Owners will initiate a physical inventory when a mismatched condition 

on serial number (and UII when available) is identified between its records and 

transactions received. The owner will first request a physical inventory of all 

owners be conducted by the storage activity that sent the transaction generating 

the mismatched condition. If the initial physical inventory is unable to resolve the 

mismatched condition the owner may need to coordinate requests for physical 

inventories with DLA Distribution to conduct inventories of all owners at all other 

storage activities storing that NSN.

C6.13.2.1. Owner/manager processing a materiel release confirmation 

from a storage activity where the owner does not have a matching record of the 

serial number (and UII if available) or the owner/manager records have that serial 

number (and UII if available) located at other than the storage activity reporting 

the release/issue of the item. Either of these conditions may necessitate a 

complete inventory be taken at all storage locations for all owners and supply 

condition codes.
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 5

C6.13.2.2. Owner/manager processing receipts, issues, or inventory 

adjustments from storage activities where there is a mismatch on serial number 

(and UII if available) between the owner records and storage activity transactions 

reporting which serial number (and UII if available) will at a minimum necessitate 

an inventory and research to resolve the discrepancy.

C6.13.2.3. Owner/managers processing location reconciliation history 

transactions resulting from End-of Day processing or an owner initiated location 

reconciliation request where there is a mismatch on serial number (and UII if 

available) between the owner records and the storage activity transactions. The 

history transactions for capital equipment candidate items will perpetuate the 

serial numbers (and UIIs if available) that were included on the original 

transactions. 

C6.13.3. Location Survey

C6.13.3.1. Location survey requires a physical verification, other than 

actual count, between assets and recorded location data to ensure that all assets 

are properly recorded. 

C6.13.3.2. Due to the nature of capital equipment candidate items, these 

items are frequently in individual storage locations within the storage activity. 

The storage activity may, for items of this nature, include the serial number (and 

UII if available) verification as part of the location survey. When a discrepancy is 

identified during the location survey program (Type I or Type II error (see 

paragraphs C6.8.1.2.1. and C6.8.1.2.2.)), the storage activity will conduct prompt 

research and assess the need for a special inventory Physical Inventory Request 

Transaction with Type of Physical Inventory/Transaction History Code K).

C6.13.4. Location Reconciliation. Storage activities will prepare location 

reconciliation requests by line item. For capital equipment candidates, the line 

item = NSN + SCC + serial number + UII (when available).

C6.13.5. Capital Equipment Candidates Inventory Adjustments. The 

inventory adjustment function encompasses increases, decreases, or dual 

adjustments. The C6.4 procedures for processing and reporting of Inventory 

Adjustments (Physical Inventory) also apply to apply to Inventory Adjustments 

(UII and/or Serial Number Mismatch) with the following additions:

C6.13.5.1. Capital equipment candidate items inventory adjustment 

gain, loss, or dual adjustment transactions will include the serial number (and UII 

if available). Adjustments due solely to the need to correct serial number and/or 

UIIs will always be for a quantity of 1. 

C6.13.5.2. Capital equipment candidate items where a discrepancy 

exists solely on mismatched serial number and/or UII will include Quantity or 

Status Adjustment Reason Code AQ (Inventory Adjustment (UII and/or serial 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 6

number mismatch)) in the inventory adjustment transaction, Chapter 7, Table 

C7.T1 contains the quantity or status adjustment reason codes.

C6.13.6. Research of Potential or Actual Inventory Adjustments (UII and/or 

serial number mismatch) (DLMS 947I with Quantity or Status Adjustment Reason 

Code AQ)

C6.13.6.1. DoD Components will ensure that potential or actual 

inventory adjustments for capital equipment candidate items that result in an 

inventory adjustment are reported with Quantity or Status Adjustment Reason 

Code AQ and are researched in accordance with the procedures paragraph C6.4. 

C6.13.6.2. Due to the value of capital equipment candidate items,

discrepancies will always require the most demanding research requirements set 

forth in Table C6.T3.

C7. CHAPTER 7. INVENTORY ADJUSTMENTS

(Intervening text not shown)

Add new C7.1.1.1.5, and renumber existing C7.1.1.1.5:

C7.1.1.1.5. Discrepancies disclosed by physical inventory due to unique 

item identifier (UII) and/or serial number mismatch.

(Intervening text not shown)

Add new Quantity or Status Adjustment Reason Code AQ to Table C7.T.1.

C7.1.2.1.2. Inventory adjustments are further broken down by the DLMS 947I, 

ASC X12 warehouse adjustment item detail segment (2/W1901/0200) Quantity or 

Status Adjustment Reason Code. The quantity or status adjustment reason codes 

correlate to the 3rd position of MILSTRAP legacy DICs D8_/D9_ or DAC/DAC/DAS as 

identified in Table C7.T1:

Table C7.T1. DLSS DIC/DLMS Quantity or Status Adjustment Reason Code Correlation

W1901 Quantity 

or Status 

Adjustment 

Reason Code

Explanation

Corresponding

MILSTRAP 

legacy DIC

AQ Inventory Adjustment (UII and/or serial 

number mismatch). Gain, loss, or dual 

adjustment resulting solely from UII and/or 

serial number mismatch.

Not Applicable 

to legacy 

MILSTRAP 

(Intervening text not shown)
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 7

Add new C7.6, and renumber remaining paragraphs:

C7.6. INVENTORY GAINS AND LOSSES DUE TO UNIQUE ITEM IDENTIFIER 

AND/OR SERIAL NUMBER MISMATCH. Procedures concerned with inventory 

adjustments due to UII and/or serial number mismatch losses or gains are 

contained in Chapter 6.

C11. CHAPTER 11. MATERIEL RETURNS, REDISTRIBUTION OF ASSETS, 

DIRECTED DISCREPANT/DEFICIENT MATERIEL RETURNS, AND RETROGRADE 

RETURNS

(Preceding text not shown)

C11.7.1.2. Reporting activities returning materiel under MRP will prepare and 

submit a DLMS 856R, Shipment Status Materiel Returns, with unique item identifier

(UII) and/or corresponding serial number(s) for NSNs containing an item unique item 

identifier (IUID) Indicator Yes (Y), indicating that DoD IUID Supply Policy compliance is 

required, after materiel directed for return is released to the carrier. The exception to 

the forgoing in support of Financial Improvement and Audit Readiness (FIAR)

compliance for accountability and management of capital equipment, capital

equipment candidates require serialization data visibility. Submitters must 

prepare shipment status materiel returns citing the applicable serial number(s) 

and include the UII when available. Prepare a separate DLMS 856R for each 

shipment. Exercise care to ensure that appropriate data content, including suffix of the 

individual DLMS 870M, Reply to Customer Asset Report (MILSTRIP Legacy DIC FTR), 

is perpetuated in the DLMS 856R. The DLMS 856R will be sent to the ICP/IMM and the 

designated return-to activity. the ICP/IMM is not required to store UIIs or serial numbers 

except for capital equipment candidates that require serialization data visibility.

(Intervening text not shown)

C11.8.3. ICP/IMM Follow-Ups on Directed Returns (DLMS 870M). Upon receipt 

of DLMS 870M, ICP/IMM Follow-Up, from the ICP/IMM, the reporting activity will review 

records to determine whether a DLMS 870M, Reply to Customer Excess Report, had 

been received. If there is no record of having received DLMS 870M reply to the 

customer excess report, the 870M ICP/IMM Follow-Up transaction will be converted to 

DLMS 870M, Reply to Customer Excess Report, and processed. If shipment has not 

occurred, DLMS 870M, Materiel Returns Program Supply Status, citing the ESD will be 

submitted. If records indicate that shipment has occurred, the transportation activity will 

be queried to ensure that the materiel has been shipped. If the materiel has been 

shipped, a new DLMS 856R, will be prepared and submitted identifying the quantity 

shipped to include UIIs and/or corresponding serial numbers for NSNs containing an 

IUID Indicator Y, indicating that DoD IUID Supply Policy compliance is required. The 

DLMS 856R will be sent to the ICP/IMM and the designated receiving activity. Capital 

equipment candidates require serialization data visibility and therefore must cite 

the serial number and include the UII when available. If materiel has not been 

shipped, determine when the shipment will be made and follow the above procedures. 

When less than the total quantity contained in the original DLMS 870M is to be shipped, 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 8

the reporting activity will respond to the DLMS 870M, ICP/IMM Follow-Up, with DLMS 

870M, Materiel Returns Supply Status, for the quantity to be shipped and DLMS 180M 

for the quantity that will not be shipped. If any of the shipment has already occurred, 

the reporting activity will respond to DLMS 870M (ICP/IMM Follow-up), with DLMS 856R 

for the quantity that has been shipped, to include UIIs and/or corresponding serial 

numbers for NSNs containing an IUID Indicator Y, indicating that DoD IUID Supply 

Policy compliance is required. The DLMS 856R indicating partial shipment will be sent 

to the ICP/IMM and the designated receiving activity. Capital equipment candidates 

require serialization data visibility and therefore must cite the serial number and 

include the UII when available. A DLMS 870M supply status and/or DLMS 180M 

cancellation will be sent to the ICP/IMM for the remaining portions of the originally 

reported quantity, as appropriate.

(Intervening text not shown)

C11.9.1. Items Designated by a Supply Source for Automatic Return. DLMS 

180M Automatic Return Notification is used for items by a source of supply for 

automatic return. Supply sources will notify reporting activities of the location to which 

items so designated are to be shipped. The returning activity will prepare and submit 

the DLMS 856R (MILSTRIP Legacy DIC FTM) with UII(s) and/or corresponding serial 

numbers for NSNs containing an IUID Indicator Y, indicating that DoD IUID Supply 

Policy compliance is required. Capital equipment candidates require serialization 

data visibility and therefore must cite the serial number and include the UII when 

available. Conformance with standard line of accounting (SLOA)/accounting 

classification requires any initiation of a financial business event to include SLOA 

mandated standard financial information system (SFIS) elements. The DLMS 

Automatic Return Notification supports inclusion of SLOA required elements. Pending 

full implementation of SLOA, DLA Transaction Services will facilitate interoperability by 

updating selected SLOA data fields based upon the returning activity’s Service/Agency 

and Fund Code. If discrete values for the SLOA data elements in the transaction do not 

match data elements from the SFIS Fund Code to Fund Account Conversion Table for 

the Fund Code in the transaction, reject with the DLMS 870M Materiel Returns Supply 

Status citing Status Code CF.

(Intervening text not shown)

C11.9.2.2. PICAs will notify SICAs of the NSN and the storage organization 

to which such items are to be shipped. PICAs will also notify the receiving storage 

activity of the NSN of such items to be returned. The SICAs will perpetuate this 

information and the PICA RIC to the materiel holder/SICA activities using intra-DoD 

Component procedures. The materiel holder will prepare and submit the DLMS 856R 

with UII(s) and/or corresponding serial numbers for NSNs containing an IUID Indicator 

Y, indicating that DoD IUID Supply Policy compliance is required. Capital equipment 

candidates require serialization data visibility and therefore must cite the serial 

number and include the UII when available. The materiel holder will send the DLMS 

856R to the SICA and the designated return-to activity, with a copy to the PICA when 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 9

directed by the SICA. The PICA will be identified as the Party to Receive Status in the 

DLMS 856R.

C11.9.2.3. If there is no DoD Component SICA for the items identified for 

automatic return by a PICA (e.g., Coast Guard), the PICA will provide the information to 

the appropriate DoD Component designated activity. The materiel holder will prepare 

and submit the DLMS 856R with UII(s) and/or corresponding serial numbers for NSNs 

containing an IUID Indicator Y, indicating that DoD IUID Supply Policy compliance is 

required. Capital equipment candidates require serialization data visibility and 

therefore must cite the serial number and include the UII when available. The 

materiel holder will send the DLMS 856R to the PICA and the designated return-to 

activity.

C11.9.2.4. For SICA-approved returns, the SICA will provide disposition 

instructions to the materiel holder under normal intra-Service implementing instructions. 

The materiel holder will prepare and submit the DLMS 856R with UII(s) and/or 

corresponding serial numbers for NSNs containing an IUID Indicator Y, indicating that 

DoD IUID Supply Policy compliance is required. The materiel holder will send the 

DLMS 856R to the SICA and the designated return-to activity. The SICA is not required 

to store the UIIs and/or serial numbers, with the exception of capital equipment 

candidates require serialization data visibility.

(Intervening text not shown)

C11.13.1. Preparation of Shipment Status. Shipment status provides information 

and normally requires no subsequent documentation. For NSNs containing an IUID 

Indicator Y, UII(s) and/or corresponding serial numbers must be included in the DLMS 

856R, indicating that DoD IUID Supply Policy compliance is required. The exception 

to the forgoing in support of FIAR compliance for accountability and management 

of capital equipment, capital equipment candidates require serialization data 

visibility. Submitters must prepare shipment status materiel return citing the 

applicable serial number(s) and include the UII when available. The DLMS 856R 

will be provided by the materiel holder and sent to both the ICP/IMM and the return-to 

activity. 

C11.13.1.3. Shipments containing IUID data content (e.g., UIIs and/or serial 

numbers) and requiring more than one freight piece to execute the movement must 

have a unique TCN assigned to each freight piece by using a partial indicator in the 

16th position of the TCN. Multiple freight piece shipments using the same TCN for all 

related freight pieces are not authorized when IUID content is required or when capital 

equipment candidates that require serialization data visibility where the serial 

number is mandatory and UII is provided when available.

C11.13.2. ICPs/IMMs will receive shipment status transactions and update 

appropriate ICP/IMM records. Shipment status with UII(s) and/or corresponding serial 

numbers under DoD IUID Supply Policy requirements, will be received by ICP/IMM, but 

they are not expected to store and track by UII, with the exception of management of 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 10

capital equipment candidates that require serialization data visibility. The 

shipment date indicated in DLMS 856R, Shipment Status Materiel Returns, is available 

to ICPs/IMMs to verify in-transit status and provide information on expected receipts. 

DLMS 856R received for items not under control of the ICP/IMM will be rejected to the 

reporting activity using DLMS 870M, Materiel Returns Supply Status (From ICP/IMM), 

with reject Status Code SC. DLMS 856Rs that do not pass data field validity checks will 

be rejected to the reporting activity using DLMS 870M, with the appropriated S series 

status code.

(Intervening text not shown)

C11.20. DIRECTED DISCREPANT/DEFICIENT MATERIEL RETURNS AND 

RETROGRADE RETURNS

(preceding text not shown)

C11.20.2.3. The materiel returns shipment status will include passive radio 

frequency identification (pRFID), and for NSNs containing an IUID Indicator Y, UII(s) 

and/or corresponding serial numbers must be included in the DLMS 856R, indicating 

that DoD IUID Supply Policy compliance is required. 

C11.20.2.4. Capital Equipment Candidates. In support of FIAR 

compliance for accountability and management of capital equipment, capital 

equipment candidates require serialization data visibility. Submitters must 

process directed returns for SDR, PQDR TDR and retrograde returns citing the 

applicable serial number(s) and include the UII when available. 

(Intervening text not shown)

C11.20.3.1. Supply Discrepancy Report

(Preceding text not shown)

C11.20.3.1.4. The returning activity will prepare the DLMS 856R, 

materiel returns shipment status citing the Return Type Code, identifying the reason for 

return for which the materiel returns shipment status is provided. If the controlling 

document number for the directed return is the same as the customer’s requisition, a 

unique transportation control number (TCN) (not derived from the original document 

number) will be identified. The shipment status will perpetuate the DoD WebSDR 

control number (required where electronic interface is available to facilitate inclusion of 

this data content). The materiel returns shipment status will include pRFID, and for 

NSNs containing an IUID Indicator Y, UII(s) and/or corresponding serial numbers must 

be included in the DLMS 856R, indicating that DoD IUID Supply Policy compliance is 

required. Shipment returns containing IUID data content (e.g., UIIs and/or serial 

numbers or for capital equipment candidates serial number and UII if available) 

and requiring more than one freight piece to execute the movement must have a unique 

TCN assigned to each freight piece by using a partial indicator in the 16th position of the 

TCN. Multiple freight piece shipments using the same TCN for all related freight pieces 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 11

are not authorized when IUID content is required. The shipment status will be directed 

to the ICP/IMM (or other organization that directed the return). With the exception of 

capital equipment candidates that require serialization data visibility, the ICP/IMM 

(or other organization directing the return) is not required to store the UIIs and/or serial 

numbers. The shipment status will also be directed to the return-to activity when 

identified by DoDAAC. DAAS will transmit to DLMS capable activities as identified.

(Intervening text not shown)

C11.20.3.2. Product Quality Discrepancy Report

(Preceding text not shown)

C11.20.3.2.4. The returning activity will prepare DLMS 856R, materiel 

returns shipment status citing the Return Type Code indicating the reason for the 

shipment status as deficient materiel returns. If the controlling document number for the 

directed return is the same as the customer’s requisition, a unique TCN (not derived 

from the original document number) will be identified. The materiel returns shipment 

status will perpetuate the PQDR RCN. The materiel returns shipment status will include 

pRFID, and for NSNs containing an IUID Indicator Y, UII(s) and/or corresponding serial 

numbers must be included in the DLMS 856R, indicating that DoD IUID Supply Policy 

compliance is required. Shipment returns containing IUID data content (e.g., UIIs 

and/or serial numbers or for capital equipment candidates requiring serial numbers 

and UIIs if available) and requiring more than one freight piece to execute the 

movement must have a unique TCN assigned to each freight piece by using a partial 

indicator in the 16th position of the TCN. Multiple freight piece shipments using the 

same TCN for all related freight pieces are not authorized when IUID content is 

required. The shipment status will be directed to the ICP/IMM (or other organization 

that directed the return). With the exception of capital equipment candidates that 

require serialization data visibility, the ICP/IMM (or other organization directing the 

return) is not required to store the UIIs and/or serial numbers. The shipment status will 

also be directed to the return-to activity when identified by DoDAAC. DAAS will transmit 

to DLMS capable activities as identified.

(Intervening text not shown)

C11.20.3.3. Transportation Discrepancy Report

(Preceding text not shown)

C11.20.3.3.4. The returning activity will prepare DLMS 856R materiel 

returns shipment status citing a Return Type Code indicating the reason for the 

shipment status is applicable to a TDR directed return. If the controlling document 

number for the directed return is the same as the original shipment, a unique TCN (not 

derived from the original document number) will be identified. The materiel returns 

shipment status will perpetuate the TDR control number. The materiel returns shipment 

status will include pRFID, and for NSNs containing an IUID Indicator Y, UII(s) and/or 

corresponding serial numbers must be included in the DLMS 856R, indicating that DoD 
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 12

IUID Supply Policy compliance is required. Shipment returns containing IUID data 

content (e.g., UIIs and/or serial numbers or capital equipment candidates requiring 

serial numbers and UIIs if available) and requiring more than one freight piece to 

execute the movement must have a unique TCN assigned to each freight piece by 

using a partial indicator in the 16th position of the TCN. Multiple freight piece shipments 

using the same TCN for all related freight pieces are not authorized when IUID content 

is required. The shipment status will be directed to the ICP/IMM (or other organization 

that directed the return). With the exception of capital equipment candidates that 

require serialization data visibility, the ICP/IMM (or other organization directing the 

return) is not required to store the UIIs and/or serial numbers. The shipment status will 

also be directed to the return-to activity. DAAS will transmit to DLMS capable activities 

as identified.

(Intervening text not shown)

C11.20.3.4. Retrograde Returns. These procedures apply to returns for which materiel 

returns shipment status (DLMS 856R/DIC FTM) is not provided under the above 

MILSTRIP Materiel Returns Program.

(Preceding text not shown)

C11.20.3.4.4. The returning activity will prepare DLMS 856R materiel 

returns shipment status citing a Return Type Code indicating the reason for the 

shipment status is applicable to return/retrograde movement. The materiel returns 

shipment status will perpetuate the associated document number. A unique TCN (not 

derived from the original document number) will be identified. A customer reference 

number may be included when applicable to identify the original requisition document 

number. The materiel returns shipment status will include pRFID, and for NSNs 

containing an IUID Indicator Y, UII(s) and/or corresponding serial numbers must be 

included in the DLMS 856R, indicating that DoD IUID Supply Policy compliance is 

required. Shipment returns containing IUID data content (e.g., UIIs and/or serial 

numbers or capital equipment candidates requiring serial numbers and UIIs if 

available) and requiring more than one freight piece to execute the movement must 

have a unique TCN assigned to each freight piece by using a partial indicator in the 

16th position of the TCN. Multiple freight piece shipments using the same TCN for all 

related freight pieces are not authorized when IUID content is required. The shipment 

status will be directed to the ICP/IMM (or other organization that directed the return). 

With the exception of capital equipment candidates that require serialization data 

visibility, the ICP/IMM (or other organization directing the return) is not required to 

store the UIIs and/or serial numbers. The shipment status will also be directed to the 

return-to activity when identified by DoDAAC. DAAS will transmit to DLMS capable 

activities as identified.
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 13

C13. CHAPTER 13. MATERIEL RECEIPT

(Preceding text not shown)

C13.1.4. Use of DLMS 527R for Receipt. DLMS 527R will be used by receiving 

activities to report both receipts and historical receipt information to owners and other 

management control activities. 

C13.1.5. Capital Equipment Candidate Receipts. In support of Financial 

Improvement and Audit Readiness (FIAR) compliance for accountability and 

management of capital equipment, capital equipment candidates require 

serialization data visibility. Submitters must prepare receipts for capital 

equipment candidate items to include the serial numbers (and UIIs if available). 

The DSS storage activity will send the receipt transaction to the owner and 

include the serialized data for the owner records. 

(Intervening text not shown)

C13.2.1.1. Post receipts to the total item property record by changing or 

adding to data in the advance receipt information (ARI) file established under Chapter 

12, (Due-In and Advance Receipt Information) procedures, or by extracting data from 

the consignment documentation. For capital equipment candidates, receiving 

activities will maintain the serial numbers (and UIIs if available) on their records.

(Intervening text not shown)

C13.2.8.2.1. Discrepancy Determination. Upon receipt of all incoming 

materiel shipments, from procurement instrument and non-procurement instrument 

sources, receiving activities will research all available documentation and item markings 

(i.e., transaction or contract number, national stock number (NSN), or other, item 

identification number, ARI file, quantity, condition, inspection/acceptance requirements, 

etc.) to determine the receipt data. Using this data, receiving activities will determine if 

a discrepancy/deficiency (hereafter referred to as discrepancy or discrepant) exists and 

will identify its nature. For capital equipment candidate items, mismatches on 

serial number (and UII) will be considered discrepancies.

(Intervening text not shown)

C13.2.8.2.4.8. The Item Unique Identification (IUID) Registry for serially 

managed assets

(Intervening text not shown)

C13.2.8.2.8.13 Capital Equipment Candidate Item Serial 

Number (and UII if available). Report discrepancies on serial number (and UII if 

available) using the procedures contained in Chapter 17.

(Intervening text not shown)
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 14

C13.2.8.2.8.14. Other Discrepancies. Receipt reporting will 

depend upon the type of discrepancy involved. When unusual circumstances exist, the 

receiving activity may need to get guidance from the appropriate authority before 

reporting the receipt or submitting the discrepancy report. See C13.2.8.2., above, for 

storage and accountability requirements.

C14. CHAPTER 14. ISSUE, LOAN, DEMAND, AND SINGLE MANAGER FOR 

CONVENTIONAL AMMUNITION FREEZE/UNFREEZE ACTION

(Preceding text not shown)

C14.2.1.1.4. Capital Equipment Candidate Issues. In support of 

Financial Improvement and Audit Readiness (FIAR) compliance for accountability 

and management of capital equipment, capital equipment candidates require 

serialization data visibility. Submitters must prepare issue transactions for 

capital equipment candidate items to include the serial number(s) (and UII(s) if 

available). 

C17. CHAPTER 17. SUPPLY DISCREPANCY REPORTING 

(Preceding text not show)

C17.3.2.3. Condition of Materiel

C17.3.2.3.1. Condition Misrepresented. Report when the condition of 

an item valued in excess of $100 per line-item is found to be other than shown on the 

shipping document, or, in the case of subsistence, on supporting inspection/test 

certificates or records. Use the hazardous materiel discrepancy code when applicable.

C17.3.2.3.1.1. For UIT program items, SDRs indicating a receipt in 

other than the original condition shipped will include UII and serial number (when 

available) for the discrepant quantity received. When all items are discrepant, no 

UII and/or serial number is required for IUID materiel as this information is already 

known to the relevant parties.1

C17.3.2.3.1.2. For Capital equipment candidate items, SDRs 

indicating a receipt in other than the original condition shipped will include UII 

and serial number (when available) for the discrepant quantity received. When all 

items are discrepant, no UII and/or serial number is required for IUID materiel as 

this information is already known to the relevant parties. 

(Intervening text not shown)

 1 Refer to ADC 1198.
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 15

C17.3.8. Discrepancies in Item Unique Identification (IUID) Data.

2

 

C17.3.8.1. Report supply-related discrepancies involving IUID under DoD 

IUID Supply policy, including but not limited to Unique Item Tracking (UIT) programs, 

capital equipment candidates, or as contractually required. SDRs identifying 

discrepancies in unique identification will be prepared citing both UII and/or 

corresponding serial number, when both are available. Applicability under DoD IUID 

Supply Policy is identified by NSNs with IUID Indicator Yes (Y). For missing or 

mismatched unique item identification of items that are DoD serially-managed/tracked, 

use the applicable U-series discrepancy code (see Table C17.T1.). Report missing or 

mismatched materiel identification unrelated to IUID (e.g. missing or mismatched part 

number or NSN) using the applicable packaging (labeling/marking), documentation, 

technical data, or wrong item discrepancy code(s). Report quality-related deficiencies 

involving IUID, (e.g., improperly constructed unique item identifier within the 2D data 

matrix), using Product Quality Deficiency Report (PQDR) procedures under DLA 

Regulation 4155.24, et al. In support of Financial Improvement and Audit 

Readiness (FIAR)compliance for accountability and management of capital 

equipment, capital equipment candidates require serialization data visibility. 

Thus capital equipment candidates received without a serial number will not only 

require an SDR, but will stop the equipment in the supply chain until a serial 

number is identified and the materiel is marked. Submitters must prepare 

discrepancy reports citing the applicable serial number(s) and include the UII 

when available.3

C17.3.8.2. In order to facilitate reporting of discrepancies, particularly those 

involving discrepancies where inclusion of the IUID information is required/desirable, the 

SDR submission process should be integrated with the receiving process, allowing 

receipt data to be captured once and reused. IUID discrepancies may be related to the 

packaging label, including automated information technology (AIT) readable content; the 

item marking, including AIT readable marks; supply documentation; the due-in record; 

and/or a mismatch between the item and any of these. When reporting an IUID 

mismatch (including shortage, overage, and incorrect item) the IUID content may be 

specifically identified as applicable to items received or not received using the IUID 

Received/Not Received Indicator. If no indicator is provided, the UII and/or serial 

number will be interpreted as applicable to the materiel received. Pending integrated 

capability to support IUID reporting in SDRs, remarks text may also be used to clarify 

the specific mismatched data. Additionally, attachment files may be 

uploaded/transmitted to DoD WebSDR to identify UIIs and/or serial numbers

C17.3.8.3. Discrepancies involving missing or mismatched unique 

identification identified during receipt of new procurement materiel (including direct 

vendor delivery (DVD)) must be reported prior to acceptance. Materiel may be placed 

in a suspended condition pending resolution. Discrepancies that result in incorrect 

information within the IUID registry at DLA Logistics Information Service must be 

 2 Refer to ADC 1030.

3 Refer to ADC 1198
Enclosure 2, ADC 1198

DLM 4000.25, Volume 2, Updates

Page 16

reported by the receiving activity for corrective action. Pending development of 

procedures for direct routing of SDRs to DLA Logistics Information Service, send an 

email to the DLA Logistics Information Service IUID Help Desk (iuid.helpdesk@dla.mil). 

Missing IUID content in DLMS transactions will not be reported for stock shipments 

pending full transition to DoD IUID Supply Policy procedures except as applicable to 

UIT programs and capital equipment candidates. 

(Intervening text not shown)

C17.3.8.8. SDRs prepared for a receipt in other than the original condition 

shipped where the materiel is identified by IUID Indicator Y will include the UII and 

serial number as required in para C17.3.2.3.