Attachment, ADC 1006 Page 1

ADC 1006

Exception Processing for DLA CFM Transactions

1. ORIGINATOR:

a. Service/Agency: Defense Logistics Agency (DLA) HQ

b. Sponsor: DLA HQ Order Management, J331, DSN 427-4337, Commercial

(703) 767-4337

2. FUNCTIONAL AREA: Supply/Finance

3. REFERENCES: 

a. DLM 4000.25-1, Military Standard Requisitioning and Issue Procedures 

(MILSTRIP), available at http://www.dla.mil/j-6/dlmso/eLibrary/Manuals/dlm/dlm_pubs.asp

b. DLM 4000.25-M, Defense Logistics Management System (DLMS) (same URL as 

above)

4. OVERVIEW/BACKGROUND:

a. Overview. This change documents an exception/deviation to the current

requirements under MILSTRIP procedures for contractor access to Government supply sources. 

This change establishes an automated DLA Transaction Services Defense Automatic Addressing 

System (DAAS) edit/interface to provide management control activity (MCA) validation for 

requisitions submitted by DLA contractors for contractor-furnished materiel (CFM).

b. Background

(1) CFM is defined in MILSTRIP as materiel that the contractor is contractually 

required to provide. The source of supply for CFM may be the commercial market or the federal 

supply system when authorized by contract. Under MILSTRIP transaction processing rules, 

CFM is determined by identification of a contractor as both the ship-to and the bill-to DoDAAC. 

DLA normally assigns Service/Agency Code U-series DoDAACs to DLA contractors for use in 

requisitioning from Government supply sources.

(2) DLA Enterprise Business System (EBS) does not currently support MCA 

validation for externally created CFM requisitions. Additionally, DLA Transaction Services 

does not have special program logic to accept externally created DLA-sponsored CFM 

requisitions. As a result, these transactions are being rejected under existing business rules. 

(3) Due to the high volume of rejected requisitions, work stoppages were occurring 

at the contractor’s location. DLA and DLA Transaction Services, with participation by the DOD 
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MILSTRIP Administrator, developed exception processing rules for CFM requisitions submitted 

in support of DLA-issued contracts. The DOD MILSTRIP Administrator concurred with the 

immediate implementation of these processing rules pending submission of a formal DLMS 

change to document the procedures.

5. APPROVED CHANGE:

a. Approved change in detail. Green highlighting identifies substantive revisions 

subsequent to staffing of the proposed change.

(1) DLA Transaction Services shall establish Distribution Code H as an authorized 

DLA distribution code serving to identify the DLA MCA for Service/Agency Code U. 

Requisitions submitted under the procedures described below shall include the DLA-assigned 

Distribution Code H, which is used in the MCA validation process to identify the DLA MCA. 

(2) DLA Transaction Services shall establish a DLA Authorized CFM DoDAAC 

Table to be used for validation of authorized DLA contractors identified as the bill-to DoDAAC

on requisitions. Designated DLA representatives shall notify DLA Transaction Services of 

updates to add/remove DoDAACs from the table. The table shall be used for initial validation of 

CFM requisitions submitted by DLA contractors for CFM. Requisitions identifying a bill-to 

activity with a U-series DoDAAC not contained on the table shall be rejected with Supply Status 

Code DB, “Rejected. No valid contract registered at MCA.” [This is a derived interpretation 

because DLA does not currently require the actual contract number to be identified in the DAAS 

table or the CFM requisition. The lack of the DoDAAC on the table is understood to mean that a 

contract has not been issued supporting CFM.] Transactions that are successfully matched to 

the table will be transmitted to the source of supply (SoS).

(3) DLA Transaction Services shall perform a variation of the edit described above 

for CFM requisitions submitted via DOD EMALL when the payment method is identified as 

credit card. In this situation, the bill-to DoDAAC which represents DOD EMALL (SP5200) 

cannot be properly validated against the DLA Authorized CFM DoDAAC Table. Instead, DLA 

Transaction Services will use the requisitioner DoDAAC to perform the required CFM edit. 

(4) DLA EBS shall generate MCA validation transactions for incoming CFM 

requisitions identifying a DLA contractor (U-series DoDAAC) as the bill-to activity using 

DLMS 517G (Document Identifier Code (DIC) AX1 functionality). DLA Transaction Services 

shall act as the MCA to validate the CFM requisition against the DLA Authorized CFM 

DoDAAC Table. Transactions that are successfully matched to the table will receive an MCA 

validation response using DLMS 517G (DIC AX2 functionality) with Advice Code 2M, “The 

MCA validation process has revealed that the requested item is authorized by a valid contract.” 

[This is a derived interpretation because DLA does not currently require the actual contract 

number or the materiel identification to be identified in the DAAS table. The presence of the 

DoDAAC on the table is understood to mean that a contract has been issued supporting CFM.]

Requisitions that fail to match the table shall receive DLMS 517G (DIC AX2) with Advice Code 

2U, “The MCA validation process has revealed that no valid contract is registered at the MCA.”
Attachment, ADC 1006 Page 3

b. Revisions to DLM 4000.25 Manuals: Revise the MILSTRIP Manual as shown 

below. Comparable revisions must also be made to the DLMS Manual. Changes are identified 

in bold red italics. 

(1) Modify C11.8.2 as indicated below. 

“C11.8.2. DAAS Processing of CFM Transactions. The process described in this 

paragraph provides mandatory CFM controls for CFM requisitions where the bill-to activity, as 

identified in the requisition, is an Army contractor and the source of supply is DLA. This 

process is optional for other Services and may be expanded to include other sources of supply if 

needed. DAAS shall maintain a list of Service/Agency authorized contractor DoDAACs and the 

associated NSNs/DOD-managed part numbers for which these contractors may submit CFM 

requisitions on a CFM Authorized Materiel Table for use in validating requisitions regardless of 

method of payment. CFM contractors that match the CFM Authorized Materiel Table by 

DoDAAC, but do not match by NSN or part number shall be rejected with Status Code CL; 

requisitions that match on DoDAAC and NSN/part number shall be processed as valid. DAAS 

shall enter the DAAS RIC SGA or SHA into rp 74-76 as the validating MCA. DAAS shall 

perform AX1/AX2 validation requirement for authorized CFM requisitions that match to the 

CFM Authorized Materiel Table. DAAS shall furnish CFM reports upon request for use by the 

contracting officer in verifying that quantities ordered are within the contract allowance. Army 

contractor requisitions that do not match the CFM Authorized Materiel Table shall be processed 

by DAAS under the MCA waiver exception process or passed to the applicable MCA as 

described in Paragraph C11.7.5. For DLA CFM, processing will be as identified in C11.8.3. 

CFM requisitions for other Service contractors shall be passed to the source of supply. NSNs 

listed in the table may be modified over the course of this agreement when appropriate Army 

contracting officer provides such authority. Updates to the authorized list shall be collected, 

consolidated into one Microsoft Excel file by the designated DLA Lead Center point of contact 

with proof of Army Contracting Officer concurrence and provided to headquarters (HQ) DLA 

Army Performance Based Logistics (PBL) action officer. HQ DLA shall coordinate updates to 

individual contractor lists with DLA DoD EMall and DLA Transaction Services on a monthly 

basis. To optimize program changes, all additions to Army partnership lists shall be made during 

an agreed monthly time-frame between DLA and support entities.”

(2) Add C11.8.3. as indicated below.

“C11.8.3. DLA Transaction Services Processing of DLA CFM Transactions. 

 C11.8.3.1. DLA Transaction Services shall maintain a DLA CFM Authorized 

DoDAAC Table listing DLA contractor DoDAACs authorized to requisition CFM. DLA 

Transaction Services shall populate or delete DoDAACs to/from the table as directed by DLA. 

Requisitions identifying a DLA-assigned U-series contractor DoDAAC as the bill-to activity 

shall be edited against this table. DLA Transaction Services is required to edit all incoming 

MILSTRIP DIC A0_, A3_, A4_, AM_ and AT_ (DLMS equivalent DLMS 511R/511M/869F) 

transactions containing a U-series DoDAAC when identified as the bill-to activity against the 

DLA CFM Authorized DoDAAC Table. If matched to the table, then DAAS shall route/pass 

the transaction based on established DAAS rules to the appropriate source of supply for 
Attachment, ADC 1006 Page 4

further processing. If the U-series bill-to DoDAAC does not match the table, then DAAS shall

reject the transaction using Status Code DB. 

 C11.8.3.2. DLA Transaction Services shall capture any DIC AX1 (DLMS 517G ) 

transactions containing a DLA U-series DoDAAC identified as the bill-to DoDAAC and match 

it against the DLA CFM Authorized DoDAAC Table. If the U-series bill-to-DoDAAC matches 

the table, then DAAS shall respond with a DIC AX2 (DLMS 517G) transaction with Advice 

Code 2M indicating the requisition is authorized. If the U-series bill-to-DoDAAC does not 

match the table, then DAAS shall respond with a DIC AX2 (DLMS 517G)) transaction with 

Advice Code 2U indicating the requisition is not authorized.” 

(3) Modify C11.9.1.2 as indicated below.

 “C11.9.1.2. Corporate Credit Card CFM Purchases and DAAS Processing. DoD 

EMALL requisitions for shipment to contractors using corporate credit card payment are 

assigned Signal Code B, Fund Code XP, and the SUPADD of the DoD EMALL DoDAAC 

(SP5200). This configuration identifies a Government DoDAAC as the bill-to activity, thereby 

triggering DAAS and the DoD Component source of supply processing systems to misinterpret 

such transactions as GFM requisitions. DAAS shall validate these transactions against existing 

GFM edits and the DoD EMALL CFM Table to determine appropriate action. If the contractor 

requisition does not contain a valid MCA identification code and the DoDAAC is not listed in 

the DoD EMALL CFM Table, DAAS shall reject with Status Code CL. If an MCA is identified 

by either a distribution code in rp 54 or a RIC in rp 74-76, DAAS shall forward the requisition to 

the source of supply. The source of supply shall submit a DIC AX1 to DAAS for validation 

following GFM MCA procedures (including Army CFM). DAAS shall recognize the EMALL 

SUPADD and again employ existing GFM edits and the DoD EMALL CFM Table to take 

appropriate action. If the validation using the DoD EMALL CFM Table identifies the contractor 

DoDAAC as authorized by the contracting officer for ordering CFM using corporate credit cards, 

then DLA Transaction Services shall validate the requisition and respond to the source of supply 

with a DIC AX2 using Advice Code 2M indicating that the requisition is valid. The source of 

supply shall continue processing. If the contractor DoDAAC is not contained on the DoD 

EMALL CFM Table, but the requisition contains a valid MCA code, then DLA Transaction 

Services shall forward the DIC AX1 to the MCA for validation. If the contractor DoDAAC is 

not contained on the DoD EMALL CFM Table or does not match the CFM Authorized Materiel 

Table, when applicable, and the requisition does not contain a valid MCA code, then DAAS shall 

provide a DIC AX2 with Status Code CL indicating that the transaction is invalid. The source of 

supply shall reject the requisition. For DLA contractor credit card purchases (identified by a 

DLA-assigned U-series DoDAAC in the document number), DAAS processing rules shall be 

as described in this paragraph, except that the requisition shall be validated based upon the 

requisitioner DoDAAC matching to the DLA CFM Authorized DoDAAC Table.” 

c. Alternatives: None identified.

6. REASON FOR CHANGE: CFM requisitions for DLA contractors identified by U-series

DoDAACs were not processing successfully in DAAS or EBS. Without a workaround, EBS

could not process requisitions from contractors supporting DLA Aviation for Fleet Readiness 
Attachment, ADC 1006 Page 5

Center (FRC) requirements due to an inability to obtain CFM validation from either internal or 

external sources; this resulted in contractor work stoppages. This exception validation by DLA 

Transaction Services will permit CFM requisitions to process automatically through EBS. The 

exception provides automated processing without human intervention. It also applies more 

stringent controls for management of CFM.

7. ADVANTAGES and DISADVANTAGES:

a. Advantages: This process change will improve control, flow, and timeliness to 

support external customers. It will provide goodwill to FRC customers or other CFM customers 

with unique requirements that the system currently lacks. It takes advantage of the current EBS 

enhanced process capabilities. On the other hand, failure to approve and implement this process 

change will hamper the requisitioning process vital to DOD needs. 

b. Disadvantages: The systemic DAAS validation process only verifies that the 

contractor is authorized to requisition. It does not perform full MCA validation by materiel 

identification and cumulative quantity ordered. The minimal DoDAAC validation is acceptable 

under current supply chain management policy. However, this policy is under consideration for 

requiring tighter controls. The DOD MILSTRIP Administrator has discussed the feasibility of 

extending the DAAS edit to include authorized materiel identification, but due to the vast 

ordering authority that may be provided to DLA contractors for DLA-managed materiel, DLA

considered this level of validation to be impractical. 

8. ESTIMATED TIME LINE/IMPLEMENTATION TARGET: DLA Transaction Services 

provided capability to support successful transaction processing on December 14, 2011. 

Enhanced capability to facilitate maintenance of the authorized DoDAACs has since been 

developed in association with this ADC. The CFM Authorized DoDAAC Table was updated for 

contractor DoDAACs: UY9277, UY9278, and UY9279.

9. IMPACT:

a. New/Revised DLMS Data Elements: None.

b. Service/Agency Automated Information Systems: None.

c. DLA: Contractors identified by UY9277, UY9278, and UY9279 must be advised to 

discontinue use of Distribution Code/MDN F00 and begin using H00.

d. DLA Transaction Services:

(1) Creation of DLA CFM Authorized DoDAAC Table to manage U-series 

DoDAAC CFM requisitions and edits driven by this table as outlined above: The table will be 

configured to validate incoming DLMS 511R, 511M, and 869F (MILSTRIP DIC A0_, A3_, 

A4_, AM_ and AT_) containing a bill-to U-series DoDAAC. If the DoDAAC is on the table, 

DAAS will insert RIC SGA as the MCA (MILSTRIP record position (rp) 74-76) and route the 

transaction to the DLA source of supply (MILSTRIP rp 4-6). For requisitions originating in 
Attachment, ADC 1006 Page 6

DoD EMALL using credit/purchase card payment method (bill-to SP5200), the DoDAAC table 

match will be based upon the document number DoDAAC. For incoming DLMS 517G (DIC 

AX1) transactions, if the bill-to DoDAAC is on the table, DAAS will furnish a DLMS 517G 

(DIC AX2) transaction with Advice Code 2M; if not, the advice code will be 2U. 

(2) In conjunction with this change, the DLA-assigned Distribution Code H shall be 

associated with DLA DoDAAC SC1034/Routing Identifier Code (RIC) SVP, and loaded to the 

Distribution Code Table as follows:

Distribution Code H (for use with Service/Agency Code U)

DLA Land & Maritime Hazardous Materiels MCA

3990 East Broad Street

Columbus, OH 43216-9330

e. DOD EMALL: Review above procedures for consistency with required controls on 

contractors requisitioning from Government supply sources.
Enclosure, ADC 1006 Page 1

Enclosure, Staffing Comments/Concurrence

# Submitter Comment Resolution

1. MILSTRIP 

Administrator

DLA is requested to provide the DoDAAC 

and RIC associated with the MCA for new 

Distribution Code H.

DLA determined 

that a unique 

DoDAAC would be 

used for this MCA. 

DLA assigned 

DoDAAC SC1034 

and RIC SVP.

2. Air Force Concur Noted.

3. Navy Concur Noted.

4. DLA Concur Noted.

5. Army Concur Noted.

6. Marine Corps Concur Noted.

7. USTRANSCOM Abstain Noted.