July 31, 2013

MEMORANDUM FOR DISTRIBUTION

SUBJECT:  Defense Logistics Management Standards (DLMS) Finance Process Review Committee (PRC) Meeting of July 30, 2013

	The attached minutes of the DLMS Finance PRC meeting are forwarded for information and appropriate action.

	The DLA Logistics Management Standards Office point of contact is Mr. Robert Hammond, Chair, Finance PRC, email financehq@dla.mil, 

		    /s/

	DONALD C. PIPP

	Director,

	DLA Logistics Management

	Standards Office

Attachment:

As stated

cc:

ODASD(SCI)

ODCMO

Finance PRC members

Meeting attendees

July 31, 2013

MEMORANDUM FOR RECORD

SUBJECT: Defense Logistics Management Standards (DLMS) Finance Process Review Committee (PRC) Meeting of July 30, 2013

**Purpose:** DLA Logistics Management Standards Office hosted a Finance PRC meeting via Defense Connect Online (DCO).  The focus of the meeting was the Web Fund Code Application in development by DLA Transaction Services that expands the current fund code table to include selected Standard Financial Information Structure (SFIS)/Standard Line of Accounting (SLOA) data elements, as discussed in Proposed DLMS Change (PDC) 1043. The meeting provided a demonstration of the application and topics relating to the application, including issues surrounding impact of SLOA on establishment of fund codes. A listing of attendees and all meeting related materials and briefings are available on the Finance PRC Web page linked to the meeting agenda at http://www.dla.mil/j-6/dlmso/Archives/archives_fin.asp.

**Brief Summary of Discussio**n:  Mr. Robert Hammond (Finance PRC Chair) facilitated discussion of the following agenda items: 

1. **Welcome and Opening Comments:**  Mr. Hammond extended his **sincere appreciation** to all meeting participants and to DLA Transaction Services for the superb work on developing the Web Fund Code Application.  Mr. Hammond reminded meeting participants of responses due to action items for the Joint Finance and Supply PRC meeting of June 20, 2013, some of which are applicable to Web Fund Code as discussed below.

2. **Web Fund Code Demonstration:**

a. **Goals**. Goals of the Web Fund Code Application are to

·  facilitate legacy and future processes, 

· support Treasury Account Symbol (TAS) and  SFIS/SLOA by adding some key data elements to SFIS to Fund Account Conversion Table,

·  enhance edits to improve financial processes and support audit readiness,

·  facilitate real time update of fund codes by Fund Code Monitors, 

·  allow for staging fund codes for future effective dates, and 

·  replace email distribution of fund code updates with system-to-system synchronization.

b. **Web Fund Code Application Current Status**.  DLA Transaction Services is completing application development and will submit the application to the DLA Internet Council for approval.  In the event that the DLA Internet Council does not complete review and approval prior to September 30, 2013 for the start of Fiscal Year 2014, the database will still be available and DLA Transaction Services will be able to accept and make fund code changes pending application approval. Fund Code Monitors will participate in application testing.

c. **Web Fund Code Application Functionality.**  Mr. Hammond presented screen shots showing the application functionality and data content for different scenarios. Participants discussed specific data elements and relationships.

3. **Web Fund Code Topics:**

a. **Data Elements and File Layout.**Data elements and the Web Fund Code file layout were discussed in detail, including conditions for use, business rules, and inter-relationships. The following data elements are of particular note**:**

(1) **Availability Type Code.**This is a SLOA data element that was added to the application subsequent to PDC 1043, because it can be accommodated on the table. Relationship to appropriation types, including no year appropriations, was discussed.

(2) **Sub Class Code.** Business rules will be needed regarding use of Sub-class Codes in both DLMS Transactions and in the Web Fund Code Application.  Sub-class Codes are assigned in certain cases for grouping designated disbursement and/or receipt transactions below the level of appropriation or fund account represented by the main account for an appropriation, fund, or receipt account.  Most DOD values are standard values that will be ultimately be accommodated by the Business Event Type Code (BETC), which is not a Web Fund Code data element. However, Treasury may assign additional values in the future.  Currently, it is anticipated that the Sub-class Code field would be null when BETC is fully implemented.  Until BETC is fully implemented, there is one current scenario for disbursements or adjustments for obligations that would have been properly made to a cancelled appropriation that would cite Sub-class 46.  These may be disbursed from an unexpired appropriation with the same purpose up to a cumulative limit of one percent of the unexpired appropriation.  Another possible scenario for the current sub-class code is borrowing in support of working capital funds, which cannot be comingled with other funds. Adoption of the Sub-class Code in DLMS transactions and in the Web Fund Code Application has been deferred pending additional research and coordination to confirm logistics requirements and determine business rules for use of Sub-class Code.  Upon completion of this effort, requirements will be re-staffed as an addendum to Approved DLMS Change 1043 (when issued). Fund Code monitors were asked to consider if separate fund codes could be established to support the two Sub-class Code scenarios discussed above.

(3) **Legacy Multi-Year Indicator.**This data element was added to indicate that the beginning and ending periods of availability are not available from the SFIS to Fund Account Conversion Table for the multi-year appropriation applicable to the fund code. This is discussed later in the Concept of Operations.

(4) **Appropriation.** The appropriation data element has been retained from the current fund code table; however, it will be constructed from its component data elements of: Department Regular Code, Fiscal Year Indicator, Main Account, and Limit/Subhead.

(5) **Sub Account Code.** Fund Code Monitors must assess the use of this data element to ensure that it will not create a need for additional fund codes exceeding the number of fund codes available. The Sub-Account symbol is used to specify subsidiary level accounts associated to the main account of the Treasury Appropriation Fund Symbol (TAFS). The Sub-Account might indicate a series of subsidiary level receipt accounts or represent special subsidiary level accounts requested for use by an agency and approved by the U.S. Treasury. Sub-account balances aggregate to the main account balance. The Sub-Account has the potential for several relationships to the Main Account. Sub Account Code is derived from the Limit/Subhead and Receipt Indicator.

b. **Web Fund Code Access Controls**.  Fund Code Monitors will be appointed by Components through letters of appointment using the template on the Finance PRC Web site at http://www.dla.mil/j-6/dlmso/Programs/Committees/Finance/financeprc.asp. DLA Transaction Services will establish role-based access for Component Fund Code Monitors to control access according to their assigned Service and Agency codes. Fund Code Monitors will be required to submit System Access Requests to DLA Transaction Services for both development and production applications, which will be validated against their appointment letter prior to granting access.

c. **Fund Code Output Options**.  A logistics report will still be from the authoritative reference table published at the DLA Transaction Services Website https://www.daas.dla.mil/daashome/services.asp, but it will be expanded to show SLOA data elements.  Two options for report layouts were presented at the PRC, which are shown in the Web Fund Code Application presentation slides 10 and 11.  One option includes the concatenated appropriation along with the discrete elements, while the other leaves out the concatenated appropriation.  Components were asked to provide feedback regarding a preference for one report layout or the other.  There are also plans for a Web Service to provide Component application systems near real-time access to the database, and a downloadable file format, which will have access restrictions.  Defense Automated Message Execution System (DAMES) emails will be continued until no longer needed. Web Services is the preferred output option.

d. **Potential Future Fund Code Table Edits**

(1) **Fund Code Table Synchronization**.  There is a disconnect between the Fund Code to Fund Account Conversion Table (MILSBILLS Appendix 1.1) and the Fund Code to Billed Office DoDAAC Table (MILSBILLS Appendix 1.2 ) used for third party billing (Signal Code C/L).  DAAS is unable to route transactions for third party billing when there is a fund code on the Fund Code to Fund Account Conversion Table but not on the Fund Code to Billed Office DoDAAC Table. These transactions reject. A proposed edit would require that when DOD Signal Code is C/L, if a fund code is on the Fund Code to Fund Account Conversion Table it must also be on the Fund Code to Billed Office DoDAAC Table. 

(2) **Allowable Changes to the Fund Code to Fund Account Conversion Table**. Once the effective date of a fund code has been reached, changes to the financial data associated with a fund code may present billing and auditability issues. A proposed future edit would not allow changes. If a fund code was created in error, the Fund Code Monitor could delete the fund code.

(3) **Deleted Fund Codes.**Deleted fund codes are proposed to remain in the database for five years for information purposes. DAAS can edit transactions to reject DLMS transactions from processing using these fund codes and Component applications would require the same edit. Components should comment on any implications for retaining deleted fund codes on the Fund Code to Fund Account Conversion Table for five years.

(4) **Availability Type Code (AT).**The Web Fund Code Application could programmatically convert the AT Code to “C” for a cancelled TAS five years after the ending period of availability in cases where the ending period of availability is entered.

e. **Potential Future Data Elements Considered**

(1) **Agency Accounting Identifier (AAI).** AAI is a required data element for SLOA. AAI identifies the accounting system responsible for recording the accounting event (i.e., AAA/ADSN/FSN).  In lieu of carrying AAI in all transactions, there was a suggestion at the Finance PRC to include the AAI as a data element in the SFIS Fund Code to Fund Account Conversion Table.  This would require that the AAI be unique for each fund code. 

(2) **Reimbursable Flag.** The reimbursable flag indicator is used to identify those expenditures incurred for a designated TAFS account that are considered reimbursable to the account.  PDC 1043 requested clarification regarding whether an Interfund bill is always reimbursable, such that the reimbursable flag may not be required in DLMS.  OUSD(C)/ODCMO responded that the element relates to how the appropriations are defined, not whether the action is reimbursable.  Appropriations are designated as R (Reimbursable) or D (Direct).  Appropriations can include both R and D.  The reimbursable flag clarifies which is applicable to a business event with financial implications.  The requisitioner would record an obligation as either direct or reimbursable.  When ordering from others, the determination would be based upon the intent of the requisition (e.g., for self-use or use on behalf of another).  This would have application, for example, for working capital funds. During the meeting, Fund Code Monitors indicated that adding the Reimbursable Flag to the SFIS Fund Code to Fund Account Conversion Table is not desirable.

f. **Implementation Concept of Operations (CONOPS)**.  For the initial population of SFIS Fund Code to Fund Account Conversion Table data, DLA Transaction Services will convert available existing data from the Fund Code to Fund Account Conversion Table to the discrete SLOA data elements.  Then, Service Fund Code Monitors will supply additional data for batch upload by DLA Transaction Services.  Components would begin FY 2014 with new fund codes for any period of availability that includes FY 2014.  All requisitions going forward would properly reflect the beginning and ending periods of availability for the Treasury Account Symbol (TAS) that the seller is required to have for Interfund billing. Existing legacy multi-year appropriations will be flagged on the SFIS Fund Code to Fund Account Conversion Table using the legacy multi-year indicator to show that the beginning and ending periods of availability are not available from the table for these fund codes.  By the end of FY 2014, the vast majority of items previously requisitioned with legacy multi-year fund codes would have been delivered and billed.  Only backordered items with multi-year fund codes are of concern; backorders for single-year and no-year appropriations are not a concern.  Some backordered item options might include:

· buyer modify backorder requisition to replace fund code;

· seller bill via non-Interfund;

· Components advising OUSD(C) and ODCMO that some transactions may still require buyer side adjustments at Treasury to correct periods of availability.

g. **Fund Code Limitations**.  Fund code is two characters in length, thus limiting the number of possible fund codes to 1296 per Service/Agency and signal code combination.  This number includes use of numeric 0, 1 and alpha I, O.  Once used, a fund code must remain on the SFIS Fund Code to Fund Account Conversion Table for five years past the ending period of availability in order for bills to process.  Thereafter, current year funds must be used to pay the bills. Adding beginning and ending periods of availability for multi-year appropriations, which is proposed, is potentially problematic.  Single year and no-year appropriations will not be impacted. There is potential for overwhelming demand for new fund codes for multi-year appropriations.  Component processes for third party billing and extensive use of limit/subhead increase the demand for fund codes. Components were asked to examine possible changes to Component processes and use of DLMS to address the demand for future fund codes.  As a consideration, DLMS might be used to perpetuate and return data for buyer accounting purposes that is not needed by the seller for Interfund billing.  Ultimately, achieving DLMS capability among all trading partners and for all financial feeder systems will accommodate TAS requirements.

4. **Action Items**

**Next Meeting:** Future Finance PRC meetings, including focused topic meetings, will be scheduled as needed.

_________/s/_____________ 				 

ROBERT HAMMOND 				

Chair, DOD Finance PRC 	

Approved: _______/s/______

DONALD C. PIPP

Director,

DLA Logistics Management 

Standards Office 

Attachment

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