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b. Tracy Jackson, Defense Finance and Accounting Service (DFAS), Enterprise

Solutions GWA/GTAS Project Office, is leading GWA coordination for the Department of 

Defense. She provided an overview of impacts and status. Ms. Jackson noted support for 

Interfund billing is essential. One DOD challenge is to determine the end-state systems 

solution to transition from monthly to daily reporting. She noted that reclassification and 

reconciliation of Funds Balance with Treasury is critical and must be maintained.

c. Mr. Hammond recently became aware of the GWA initiative and facilitated 

meetings with staff from Treasury, Office of Secretary of Defense Comptroller (OSD(C)

DFAS, Defense Logistics Agency (DLA), Defense (DOD) Deputy Chief Management Officer 

(DCMO, Federal Agencies engaged in Interfund billing, and Logistics Management Standards 

to assist in assessing the applicability and impacts of GWA to logistics processes and systems. 

Meeting minutes from the November 9, 2011 meeting and relevant links are included on the 

FPRC Agenda. Significant points include: 

i. There are potential significant systems, process, policy, data, and resource 

implications for the Department of Defense and Federal Agencies using Interfund billing. 

ii. DOD policy (DOD Financial Management Regulation, DOD 7000.14-R) 

mandates use of Interfund billing where possible.

iii. Interfund billing is an automated, highly efficient, streamlined process,

using summary level reporting to Treasury by DFAS and Federal Central Accounts Offices

(CAOs). Logistics procedures, policies, and data elements (including bill validation, transaction 

routing, and funds transfer) are in place to support Interfund.

iv. Interfund reporting is done at the summary level only, for approximately

2.1 million summary bills, supported by 51 million detail bills, totaling $55 billion annually. 

DFAS seller CAOs report both sides of the funds transfer between appropriations on SF 1220.

v. General Services Administration (GSA), does Federal Agency Interfund 

billing for over $2 billion in annual sales to Department of Defense using the Simplified 

Interagency Billing and Collection (SIBAC) system, has been advised that Treasury currently 

plans to discontinue support for SIBAC. Treasury has suggested Intra-Governmental Payment 

and Collection System (IPAC) as an alternative solution. 

vi. Intra-Governmental Payment and Collection (IPAC) System is much more 

labor intensive process reported at the detail level. There are potential process, volume, and data 

issues associated with the use of IPAC. DFAS and Federal Agencies participating in Interfund 

strongly oppose IPAC as an alternative approach to Interfund.

vii. The FPRC role is to gather/share information to assess 

applicability/impacts to DOD Logistics Information Exchange; support OSD(C) in leading role 

with Treasury for implementation and compliance; support DFAS and the Federal Agencies as 

needed; and address any policy/process changes via applicable DOD Process Review 

Committees.

2. Financial Eliminations. Financial eliminations are a significant issue for Treasury and a 

material weakness for DOD. Mr. Hammond is very interested in whether logistics transactions, 

particularly Interfund, are contributing in any way to this condition, so that we may assist in 

resolution. Treasury will present a focused briefing to the FPRC, which is tentatively planned for 

January 2012.
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3. Treasury Interagency Agreement (IAA). Paul Lionikis of the Federal Reserve Bank of 

Boston and Peter Moore of Treasury presented information on Treasury’s Interagency 

Agreement (IAA) process and Internet Payment Platform (IPP).

a. Treasury is working to develop a clean audit of interagency buy/sell transactions. 

A Government Accountability Office (GAO) audit for 2010 found nearly $26 billion in issues 

with interagency buy/sell balances. The IAA program addresses DOD Military 

Interdepartmental Purchase Request (MIPR) transactions. Treasury FMS form 7600A, General 

Terms & Conditions (GT&C), establishes an IAA between agencies. Form7600B, Order 

Requirements and Funding Information (a.k.a. Order), is for the buy/sell transactions under the 

IAA GT&C. Treasury has cross-walked the FMS forms to the MIPR to ensure all the MIPR data 

is captured. The IAA forms are longer than a MIPR, but Mr. Lionikis indicated that IAA form 

standardizes content that has often been attached as supporting documentation to a MIPR. IAA 

does not apply to credit card transactions; however, Treasury is encouraging agencies to migrate 

away from using credit cards for inter-governmental transactions.

b. The IPP is an effort to automate the IAA process. IPP modernization is integrated 

as a front-end to the IPAC interface. Treasury is looking for pilot trading partners to perform 

intra- and inter-departmental GT&Cs and Order transactions to run during the first half of 2012. 

IPP is not yet developing Enterprise Resource Planning System (ERP) interfaces, but expects 

that Common Government-Wide Accounting Classification compliant bulk load capabilities with 

ERPs will be developed in future releases. Existing IPAC interfaces are not impacted by the 

pilot.

c. Receipt acceptance is not part of IPP. Treasury is considering where to draw the 

line in the process. They recognize that DOD is highly automated and will have different 

requirements than other Federal agencies.

d. Mr. Hammond noted a caution regarding Business Partner Number (BPN) as an 

identifier for logistics transactions, as DOD and its logistics trading partners use DOD Activity 

Address Codes DoDAACs exclusively in logistics transactions. Additional information is 

included in the Standard Financial Information Structure topic below.

e. Robin Gilliam, Department of Treasury Financial Management Service (FMS) 

Government-Wide Accounting (GWA) Systems and Standards Integrator, is working closely 

with the Department of Defense in a very cooperative relationship toward piloting the IAA. With 

respect to Interfund and other potential uses, Ms. Gilliam previously provided the following 

guidance:

i. All agencies need to understand their "inventory" of reimbursable 

agreements (transaction types) in order to determine which ones would fit best with the IAA. At 

this time, the IntraGov business rules (TFM Vol. 1, Part 2, Section 4700, Appendix 10, Section 

4) state that: “Federal entities should use the recommended standard IAA (see the FMS Web site 

at http://www.fms.treas.gov/finstandard/reference.html) for most reimbursable transactions 

between trading partners.”

ii. The recommended standard IAA is not the solution for all 

intergovernmental activity such as high-volume, low-dollar type transactions between agencies. 

It is intended to standardize and facilitate the exchange of data among intra-governmental trading 

partners for contractual type transactions.

iii. FMS can guide you on what is a good fit in relationship to reimbursable 

agreements, but while FMS can guide you where to use the IAA, agencies need to make the final 

decision based on their understanding of the transaction types involved.
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4. Standard Financial Information Structure (SFIS) ADC 435 Implementation.

a. Mr. Hammond led a discussion of ADC 435 SFIS implementation in the “Target

Environment”. Components and Agencies unanimously selected the referential data approach to 

add financial data to the fund code table and to add Business Partner Network (BPN) number to

selected DLMS transactions as an authorized future enhancement with staggered 

implementation. Referential data is used broadly in the private and public sectors to ensure the 

integrity of associated data in processes. Examples include social security number, product SKU, 

credit card number, national stock number and DoDAAC.

b. Use of a BPN without the corresponding DoDAAC is not authorized at this time. 

Components should be aware that the BPN is defined in the applicable supplements as repetition 

for the Bill-to Party, which is only distinguished by the identifying qualifier being a BPN instead 

of a DoDAAC. This requires additional programming, which led to a discussion regarding 

prioritization of enhancements relative to other important requirements. DOD and its logistics 

trading partners currently use DoDAACs exclusively in logistics transactions. DOD BPNs are 

constructed by simply adding the prefix “DOD” to the DoDAAC, and there is an initiative for 

Federal Agencies to incorporate a similar construct. There are no DLMS-capable Federal trading 

partners currently able to provide BPNs. Moreover, incorporating BPNs for the nearly 150,000 

Federal Agency DoDAACs would be costly and very problematic under the current BPN 

process.

c. The following steps are required to implant SFIS financial data elements.

i. DLA Transaction Services will create a web-enabled update application 

for the authoritative SFIS Fund Code to Fund Account Conversion Table and will support data 

replication to external systems. DLA Transaction Services indicated that this work is being 

prioritized, but no technical difficulties are anticipated. The SFIS Fund Conversion Table will 

include the current concatenated accounting data element and will include the following 

additional elements:

• Department Regular Code

• Department Transfer Code

• Main Account Code 

• Sub-Account Code

• Treasury Sub Class

• Limit/Subhead

• Beginning Period of Availability

• Ending Period of Availability

ii. DLA Transaction Services will replace the Logistics Report “Fund Code 

to Fund Account Conversion” report with the “SFIS Fund Code to Fund Account Conversion” 

report, which will display the SFIS data elements above in addition to the concatenated fund 

account. A corresponding change will be made to DOD 4000.25-7-M (MILSBILLS) Appendix 

1.1 “Fund Code to Appropriation Conversion Table”.

iii. Component/Agency Fund Code Monitors will review existing fund codes 

and delete fund codes as appropriate. Mr. Hammond recently provided a listing of unused fund 

codes to Fund Code Monitors for evaluation. This should be a near term priority effort.

iv. Once the Fund Code web update application has been completed, 

Component/Agency Fund Code Monitors will add the data elements above to the SFIS Fund 

Code to Fund Account Conversion Table. 
5

v. Components/Agencies requiring SFIS data for their logistics business 

processes may coordinate with DLA Transaction Services to establish data replication or 

alternative means for obtaining the fund code table.

5. DCMO Overview of Standard Financial Information Structure. Ray Bombac, who 

leads SFIS compliance for DOD DCMO, provided a brief overview of SFIS elements, the SFIS 

Governance Board and SFIS compliance. He noted that programs that are evaluated and found 

to be deficient in SFIS implementation receive a non-compliance condition and must then 

provide implementation plans with target compliance dates. Several DOD systems have already 

been evaluated and are working to achieve SFIS compliance. A question was raised regarding 

whether SFIS compliance equated to GWA compliance. Mr. Bombac indicated that it is his 

understanding that it does. Regarding the SFIS Governance Board, Mr. Bombac explained that 

the board votes on all data elements and business rules to incorporate needed changes. He 

offered that there is a standing weekly conference call addressing United States Standard General 

Ledger requirements and SFIS.

6. Federal Agency Billing Systems.

a. GSA is modernizing its SIBAC billing system used for Interfund billing. GSA is 

the CAO supporting GSA, Federal Aviation Administration (FAA), and National Oceanic and 

Atmospheric Administration (NOAA). SIBAC is scheduled to be replaced by July 2013. 

SIBAC is under a code freeze; functional requirements for the replacement system have been 

written. This has significant implications for GSA’s ability to meet the Treasury GWA

implementation, SIBAC be accommodated. Treasury initially indicated that GSA must convert 

to IPAC billing, but advised GSA that they are re-evaluating that assessment. DFAS reported 

that GSA IPAC submissions have been very problematic, requiring significant manual work. 

Others, including FAA, cited charge backs from buyers as a concern. GSA will incorporate 

processes to prevent inappropriately billing transactions that fail DAAS billing edits.

b. FAA is planning to become a CAO to support FAA and potentially NOAA 

billing. FAA will coordinate with DLA Transactions Services to integrate fund code table 

updates and DAAS billing edits into its processes.

7. DAAS Bill Rejects

a. Mr. Hammond noted that DAAS data validations resulted in $33 million in 

rejected bills during the past 12 months, including $7.6 million in October 2011. Rejects 

predominantly result from DoDAAC validation errors that include improper authority code.

Rejected bills are indicative of systemic process and systems issues that must be identified and 

corrected. Delayed bill processing results in unrealized revenue for the seller and delayed credits 

for buyers. Credits received after the expiration of the applicable appropriation may not be reobligated. Moreover, they create manual work for buyers, sellers, and CAOs. Resolving the 

process and systems issues will further the goal of achieving clean financial audits. Steps needed 

to resolve these issues include: working rejected bills promptly, identifying root causes, 

implementing systems and process changes over time, implementing applicable DLMS changes,

and identifying additional opportunities for improvement through proposed DLMS changes.

While DLA is the predominant seller, all Components and Agencies experience rejected bills.
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b. Cathy Shepard of DLA reported that as September, 2011 there were 407 DLA 

Interfund bills (totaling $4 million) that failed DAAS DoDAAC and other edits. Root causes 

identified to date that are being addressed include:

i. Lack of front-end edit in requisition processing systems such as 

Subsistence Total Order and Receipt Electronic System (STORES);

ii. Military Assistance Program Address Code (MAPAC) being used for 

Foreign Military Services billing vs. DoDAAC;

iii. DLA Enterprise Business System (EBS) not processing signal code in 

sales orders to bill proper party – need System Change Request (SCR);

iv. EBS automatically converting non-Interfund bills to Interfund after 30 

days – need SCR; 

v. EBS not auto populating bill-to DoDAAC for Supply Discrepancy Report

credits, resulting in manual entry errors – submitted SCR; need training in interim; 

vi. EBS dropping detail billing lines, so that totals don’t match with summary 

bill – need SCR.

c. With respect to STORES, DLA reported that these requisition transactions will be

processed through DAAS for validation. Research into root causes and coordination to resolve 

rejected bills is continuing. Michael Lane (DLA) will coordinate DLA SCR submissions.

• ACTION: GSA and all Components research causes of rejected bills;

report initial findings and plans for corrective action FPRC Chair by 

January 17, 2012.

• ACTION: Michael Lane, DLA report SCR submission status to FPRC 

Chair by January 31, 2012.

8. Non-Interfund Billing (XP Fund Code). 

a. DOD Financial Management Regulation DOD 7000.14-R, Volume 4, Chapter 3 

Receivables, Paragraph 030504.B states that “Bills arising from transactions which contain a 

National Stock Number within the DOD will be collected through the Military Standard Billing 

System (MILBILLS) Interfund billing procedures when supported by the supply and accounting 

systems. The provider will not accept a Military Interdepartmental Procurement Request (MIPR)

if Interfund can be used. Manual billing (i.e., the XP fund code) will not be used unless approved 

by the Deputy Chief Financial Officer.” 

b. Non-Interfund transactions increase processing costs and processing time. In 

addition, they are a significant source of delinquent receivables.

c. DLA has held meetings with Military Services and DFAS client executives to 

reduce the use of non-Interfund requisitions. DLA acknowledges that price adjustment issues for 

STORES requisitions have resulted in Components using non-Interfund transactions. 

d. Angel Sweetser, Systems Accountant, Air Force Accounting Requirements, 

DFAS briefed Approved DLMS Change 110 series edits for Air Force DoDAACs. Implemented

at DLA Transaction Services to reject non-authorized bill-to DoDAACs and to convert other 

DoDAAC requisition fund codes to “XP” for non-Interfund billing. ADC 262 implemented 

DoDAAC authority codes, including DAAS edit for requisitioning and billing. However, there is 

not a specific DoDAAC authority code for non-Interfund billing. Ms. Sweetser suggested that a 

DLMS change proposal be considered by FPRC members to establish such an authority code,

indicating that potential benefits include helping to prevent non-Interfund bills from coming 
7

through DLA Transaction Services and helping to identify DODAACs using non-Interfund 

billings that should be going through Interfund.

• ACTION: Michael Lane, DLA, verify if the problem between STORES and EBS

has been corrected and provide status to FPRC Chair by December 1, 2011.

• ACTION: Components and Agencies coordinate with their DoDAAC monitors to 

assess the applicability of a non-Interfund requisitioner authority code to their 

processes; report findings to FPRC Chair by December 15, 2011.

9. MILSBILLS – Credit Adjustment Process. DLA Enterprise Business System (EBS) is 

non-compliant with MILS and DLMS in not having fully implemented the financial transactions 

for billing adjustment requests and replies (MILS FAE/FAF and DLMS 812R/812L). DLA SCR 

BFI-11-038 correcting this deficiency is scheduled to be implemented by DLA in April 2012. In 

the interim, a labor-intensive email process is causing delays in processing adjustments. Joshua 

K. Doroen, Black Belt DFAS Lean 6 Sigma Program briefed an ongoing Lean 6 Sigma initiative

between DFAS and DLA to improve the process for resolving “disputed” transactions with DLA. 

Testing of Lean 6 Sigma interim process is expected to be done in late December. Mr. Doreen is 

also recommending DFAS accounts payable technicians receive training to improve 

understanding of when procedures call for a SDR, Quality Deficiency Report or FAE.

• ACTION: Michael Lane, DLA, report implementation of DLA SCR BFI-11-038

to FPRC Chair by April 30, 2012.

10 Defense Logistics Manuals (DLMs) and Combining DLMS/MILSBILLS Manuals. 

a. DODI 4140.01, which is pending signature, designates the publication of 

MILS/DLMS manuals as Defense Logistics Manuals (DLMs). MILSBILLS (DOD 4000.25-7-

M) and the DLMS Manual (DOD 4000.25-M) would be incorporated into DLM 4000.25-M, 

Volume 4 – Finance. Logistics Management Standards issued Proposed DLMS Changes to

update and combine the procedures from DLMS and MILSBILLS into DOD 4000.25-M in 

order to provide a single reference, address inconsistencies between the manuals, achieve 

administrative efficiency, and prepare for issuing DLM 4000.25-M, Volume 4. 

b. Mr. Hammond summarized merging MILSBILLS and DLMS for PDCs 488 and 

490. He noted that that a change to remove suspense accounts from Chapter 5 under ADC 294 is 

no longer correct, as Treasury issued a waiver in 2008 to permit suspense accounts under certain 

conditions. Navy acknowledged that they are still using the F3885 suspense account, and so the 

manual needs to reinsert that language. PDCs 491 and 493 raised more significant questions for 

FPRC representatives to adjudicate in merging differences between MILSBILLS and DLMS. 

For these two PDCs the FPRC stepped through the comparison matrix to discuss points where 

specific questions were asked. Decisions made and input provided will be used to develop a 

single Approved DLMS Change.

• ACTION: DFAS Cleveland provide wording for Chapter 5 to re-insert language 

for suspense accounts by December 1, 2011.

• ACTION: Roxanne Degner, GSA, finalize DoDAAC to be associated with the 

GSA NSC, by December 1, 2011.
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• ACTION: Karen Opie-Toler, DLA, validate existing MILSBILLS paragraph 

C4.2.4.1.5 with DLA Energy by December 1, 2011.

• ACTION: Linda Marflak, DLA Transaction Services, review MILSBILLS 

section C6 and provide current MILSBILLS Billing Inquiry (MILSINQ) 

processes and screen shots to FPRC Chair by December 1, 2011.

11. Finance Training. Mr. Hammond presented the DLMS Introductory Training Finance 

Module to assist participants in understanding the DLMS process. DLA and Marine Corps 

expressed interest in arranging DLMS training; Mr. Hammond identified the location of the 

training modules on the Logistics Management Standards Website for tailoring training to 

specific needs, and he will assist in coordinating training, as desired. 

10. Status of Open Items from Finance PRC Meeting of November 17, 2010

a. GSA-Directed Shipments Lost at DLA-Operated Consolidation and 

Containerization Point (CCP). GSA directs vendor shipments to customers through the DLA 

CCPs. If materiel is lost and GSA has transporter proof of delivery (TPD) from the vendor,

neither the vendor nor GSA will reimburse the customer. DLA has no policy/process to provide 

credit for CCP losses based upon submission of a Supply Discrepancy Report (SDR) to DLA. 

GSA does not accept responsibility for CCP losses. The volume of these types of lost items is 

small, but users get upset when they don’t get credit. Additional time is lost due to lack of 

published procedures governing this scenario, resulting in repeated follow-ups from the customer 

seeking resolution. Ellen Hilert (DOD Supply Discrepancy Report Sub-Committee Chair) 

initiated Draft PDC 314 to propose procedures for GSA to reimburse the customer and to then 

have DLA reimburse GSA. GSA would bill DLA for the customer’s credits. However, GSA 

noted that a code freeze for their billing system will require a manual process solution on the 

GSA end until their modernized system is operational in 2013. Proceeding with PDC 314 is 

awaiting confirmation from DLA that DLA will reimburse GSA. (STATUS: CLOSED.)

b. FAA RIC Problem. Some FAA billings to Air Force had RIC 570 vice RIC 

G69. Billie Davis, FAA, indicated that FAA is sending RIC G69. Roxanne Degner, GSA, 

indicated that a programming change implemented in April of 2011 corrected this issue.

(STATUS: CLOSED.)

c. Air Force Billing Problems Resulting from Partial Shipments. DLA 

Distribution Standard System (DSS) confirms based on partial shipments, and DLA Enterprise 

Business System (EBS) bills based on these confirmations (ARO), vice the material release order 

(A5_). The possibility existed that some bills would appear as duplicate billings. These bills 

don't contain suffixes on the document numbers. The Air Force finance system had considered

the same document number with the same quantity to be a duplicate. Cliff Klein, USAF, reported 

that a process change has been implemented that resolved the issue. (STATUS: CLOSED.)

11. Deferred Agenda Topics. The following planned agenda topics were deferred due to 

time constraints:

a. DLA Energy Convergence Initiatives, Including Aerospace Interfund Billing, 

b. DLMS 810L, 812R, and 812L ERP Implementation, 
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c. DLMS Supplement 810L Training

d. DLMS Migration Status, and 

e. Bills Without Fund Codes. 

12. Concluding Remarks. Mr. Hammond thanked all meeting participants for their 

contributions. He thanked everyone for sharing their experience and knowledge toward 

addressing current issues and enhancing logistics financial processes and procedures, noting that 

FPRC meetings provide an invaluable method of enhancing understanding of a wide range of 

business processes. 

________/s/________ Approved: ________/s/_________ 

ROBERT HAMMOND DONALD C. PIPP 

Chair DOD Finance PRC Director, 

 Defense Logistics Management Standards