volume 15, chapter 4 dod financial management ......volume 15, chapter 4 dod financial management...

Volume 15, Chapter 4 DoD Financial Management Regulation

CHAPTER 04

CASH MANAGEMENT

0401 INTRODUCTION

040101. Objectives. The objective of this chap-ter is to set forth procedures which will assurethat cash necessary to liquidate obligationsresulting from the FMS program is availablewhen the need for disbursement arises. FMSorders create contract authority. Funds appro-priated by the Congress for defense purposescannot be used to liquidate obligations resultingfrom the use of the contract authority. The cashrequirements (outlay authority) of each FMScustomer must be met by that customer.

040102. Cash Management Characteristics

A. FMS customer cash deposits intothe FMS Trust Fund for defense articles andservices sold under Sections 21 and 22 of theAECA shall be made in advance of delivery,performance, or progress payments to contrac-tors except as provided in paragraph 040102.A.1.and 2. below. Such advance cash collections tothe FMS Trust Fund must also be made fromForeign Military Financing (FMF) appropriationsused to finance a sale or special emergencyappropriations obtained to finance deliveriesunder FMS orders when billing upon deliveryand payment within 120 days after the date ofbilling is considered in the national interest.

1. Payment after delivery ofdefense articles from stock or rendering ofin-house defense services, as authorized bySection 21 of the AECA, requires a specificdetermination by the Director, DSAA, thatdelayed payment is in the national interest.

2. All cash disbursements for aforeign country or international organizationshall be identified by FMS case and shall notexceed the customer’s cash deposits. A specificcase may be in a deficit cash position with thedeficit being funded by the customer’s cash

advances on other cases. However, the cashdeposited by country "X" shall not be used toliquidate obligations incurred on behalf of coun-try "Y." A reportable adverse financial conditionexists when a single FMS customer level cashsummary account is in a deficit position (a creditbalance).

3. There are two exceptions tothe provisions of subparagraph 2. above.

a. Customer Authorizationto Use Cash for Third Party. When a customerhas authorized the use of its excess cash depositsto meet the cash requirements of another countryan adverse financial condition exists only if thecumulative cash balance of both countries is in adeficit position.

b. C u s t o m e r o r D S A ADirection to Disburse Cash on a Case Basis.When a customer or DSAA has directed thatcash be used only to meet disbursement demandof specific cases, then an adverse financial condi-tion exists for each such case that is in a deficitcash position.

4. An initial deposit shall ac-company FMS cases to provide the cash advancerequired to cover disbursements from the timethe case is accepted until the first billing duedate. FMS bills are prepared on a quarterlybasis in January, April, July, and October. Thebill includes the cash requirements for the calen-dar quarter following the quarter in which thebill is mailed. For example, a bill prepared inJanuary (December cutoff, payment due March15) is to project cash requirements through June.Thus, the initial deposit for a case accepted inDecember would be the cash required throughJune, or six (6) months of advance cash require-ments. Chapter 8 contains a full discussion ofthe FMS billing process.

B. The FMS Trust Fund corpus ismanaged as a single cash entity, as outlined in

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DoD Financial Management Regulation Volume 15, Chapter 4

subparagraph A above, regardless of the sourceof the deposits; however, all FMS Trust Funddeposits are accounted for at country and FMScase level by source of financing (MAP Merger,FMS Credit, Foreign Military Financing Credit,non-repayable, or customer national funds).

C. Since the United States Govern-ment finds it in its best interest to provideSecurity Assistance funds annually to selectedfriends and allies to finance the purchase of U.S.articles and services, it is therefore in the UnitedStates Government’s interest to properly utilizeand manage these limited funds as effectively aspossible.

1. In determining the order offunds to be paid into the FMS Trust Fund,DSAA may draw down MAP Merger funds(while available), up to the amount reserved foreach case, prior to requesting the FMS customerto draw down FMS credit funds or nationalfunds. Likewise, MAP funds on deposit in theFMS Trust Fund will be accounted for as ex-pended prior to FMS credit or national fundsdeposits, and credit funds will be consideredexpended before national funds.

2. Security Assistance funds(MAP Merger/FMS Credits/Foreign MilitaryFinancing grants or loans) that become excessdue to FMS case reduction or closure may bereapplied to other FMS cases, with DSAA ap-proval, but may not be refunded to the FMScustomer.

3. An FMS customer country,with prior DSAA approval, may provide DSAAwith a properly executed, separate FMS creditdrawdown letter to cover uncollected termina-tion liability for a billing quarter. In such event,it will be necessary to deposit into the FMS TrustFund only the amount of funds needed to covercontractual progress payments and reimburse-ments to Implementing Agencies during thebilling quarter.

D. The DSAA is authorized to enterinto a national funds investment account agree-ment (Tripartite Agreement) with an FMS cus-tomer and the Federal Reserve Bank of NewYork (FRBNY) for any country which finances all

or a significant part of its FMS programs withnational funds.

1. To be eligible, the customer’sFMS program must be large enough that thetotal amount of advance cash deposits anticipat-ed to remain in the FRBNY account will exceedthe minimum amount required for investment inshort-term, 3-6 month Treasury bills. FRBNYaccounts will not normally be considered for acountry which finances FMS programs primarilywith U.S. Security Assistance funds.

2. Subsequent to the establish-ment of the investment account, the customer isdirected to remit all national funds payments tothe FRBNY, identified to specific FMS cases.(Note: payments made from U.S. SecurityAssistance funds normally will not be remittedto the FRBNY account, but will be made directlyto the FMS Trust Fund (unless otherwise speci-fied in U.S. law).

3. The SAAC is authorized by theaccount agreement to make periodic draw-downs, usually monthly, from the FRBNY ac-count into the FMS Trust Fund as needed toprovide at all times sufficient funds to makepayments during the next thirty days.

040103. Responsibilities

A. Security Assistance AccountingCenter (SAAC). The SAAC is responsible for:

1. Timely posting of customercash deposits and disbursements thereof to FMScase accounting records.

2. Reconciling summary TrustFund level cash account balances (balance perbooks) to the Department of Treasury balance(balance per bank).

3. Assuring that approved cashexpenditure authorities do not exceed FMScustomer cash balances.

4. Identifying developing cashflow problems and alerting OSD managementand implementing agencies in a timely manner.

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B. Implementing Agencies. Theimplementing agency is responsible for:

1. Preparing and updating casepayment schedules.

2. Systematically developinghistorical cost curves for DoD major weaponsystems obtained through procurement, for usein preparing case payment schedules; and re-viewing the curves periodically for validity.

3. Continually reviewing caselevel cash balances to assure that the paymentschedule is accurate and cash is available tosupport any outlay requirements that maymaterialize for the case. This includes disburse-ments to reimburse DoD accounts for earnedreimbursements and disbursements to contrac-tors for billed costs, contract holdbacks andpotential contract termination costs.

a. In the event paymentschedules do not adequately meet the cashneeds, promptly notifying SAAC of the necessityto bill and collect additional cash advances, andfollowing up this notification by issuing a re-vised payment schedule via an LOA modifica-tion.

b. In the event paymentschedules overstate the cash needs, due to delaysin contract award, delivery slippages, or otherreasons, issuing a revised payment schedule viaan LOA modification.

4. Ensuring receipt of expendi-ture authority prior to processing a disbursementciting the FMS Trust Fund.

0402 ESTIMATING CASH ADVANCEREQUIREMENTS

040201. Method for Calculating Requirements

A. Calculation of Initial Estimate.Calculation of the cash requirements for a specif-ic FMS case requires that case costs be subdivid-ed into two broad cost categories. The firstcategory is the portion of case value to be pro-vided under authority of Section 21 of theAECA, sales from DoD inventories and the

services of DoD personnel. The second categoryis the portion of case value to be provided underauthority of Section 22 of the AECA, procure-ment of hardware or contractor services for theFMS customer. The cash advance for the portionof the case classified as a Section 21 sale shallinclude the estimated earned reimbursements tobe realized by DoD appropriation/fund accountsduring the three-month period subsequent to thepayment due date of the billing statement issuedby SAAC. The cash advance for the portion ofthe case classified as a Section 22 sale shallinclude estimated disbursements to contractorsfor contractor invoices and potential disburse-ments to contractors if additional cash depositsare not made by the customer in a timely man-ner or the case is unilaterally canceled by thecustomer. Potential disbursements to contractorsinclude payment of contract holdbacks andtermination costs which would result if workwere stopped when the cash advance availableto pay contractor invoices is exhausted. Thetime period covered by the estimate of advancecash required is the three-month period subse-quent to the payment due date of the billingstatement issued by SAAC.

B. Initial Estimates of Cash Requiredin Support of Section 21 Effort.

1. Sales from Inventory. Esti-mates of earned reimbursements for inventoryitems shall be on the basis that requisitioneditems will be dropped from inventory within 30days after a requisition for a stocked item isissued. The drop from inventory creates theearned reimbursement. Therefore, the applicableFMS case manager will develop this portion ofestimated cash requirements based upon antici-pated requisition release dates.

2. Sales of DoD Services. Esti-mates of earned reimbursements for DoD servic-es provided directly to the FMS customer or insupport of a Section 22 contract shall be basedon the estimated portion of the services whichwill be provided in the applicable billing period.Services also include applicable administrativeand accessorial surcharges.

3. Recoupment of NonrecurringCharges. Charges for nonrecurring costs are

114114


earned as items are physically delivered to theFMS customer. Therefore, the cash to be collect-ed for these charges should be based upon itemdelivery schedules.

C. Initial Estimates of Cash Requiredin Support of Sections 22 and 29 Effort.

1. Cash advances required tosupport procurements for FMS customers shallbe based upon normal administrative and pro-curement lead-times for the type of commoditybeing procured. Table 402-1 illustrates, in termsof percentage of contract costs, the total requiredcash advance necessary to support contracts foraircraft and related equipment; the percentagesare a function of procurement lead-times. TheTable also illustrates the amount of contractvalue which is being collected as a reserve forpotential termination costs and contractor hold-back.

a. Potential terminationcosts or "bailout" costs represent the liabilityDoD has to contractors in the event terminationoccurs. Generally, such costs include all accrueddirect and indirect costs and profits and subcon-tracts not covered by progress payments to thecontractor, plus any penalty contract terminationcharges that might be realized. Potential termi-nation costs do not include price increases toother ongoing contracts resulting from reduc-tions in procurement quantities.

b. Contractor holdbackrepresents amounts earned by contractors orsuppliers, but held back to ensure future perfor-mance. (Normally the result of progress pay-ments authorized at less than 100 percent.)

c. In the absence of aprocurement history for a particular system, ora similar system, or cost curves obtained from aprime contractor, Table 402-1 may be used. Thepercentages in Table 402-1 are for procurementlead-times ranging from 6 months to 60 months.This table may be used for the development ofpayment schedules included in the LOA. Thepercentage figures shown in Table 402-1 includeall applicable costs, i.e., progress paymentamounts, contractor holdback, and potentialtermination liability. The amount of the cumula-

tive monthly payment applicable to the termina-tion liability and contractor holdback reserve isshown in the second column (% TL) for eachprocurement lead-time.

2. Table 402-2 illustrates thedevelopment of a payment schedule based uponTable 402-1 percentages for the bombs underexample C of the DD Form 2061 illustrated inTable 202-3. The percentages in Table 402-1 areapplied only to pricing element "CC" or the newprocurement value of $800,000.

a. The figures in Table402-2 are based on an assumed procurementlead-time of 36 months. Although assumed forthe purposes of illustration, in actual practicethis lead-time must be furnished by the procur-ing activity.

b. For purposes of illustra-tion, the table assumes that the Letter of Offerwas signed at the end of the quarter after thebilling cut-off date, e.g., December 20. The tablefurther assumes an administrative lead-time ofthree months to go on contract, although it isrecognized that many contracts will not be letuntil much later. Implementing agencies shouldinsure that realistic contract administrative lead-times are used in preparing payment schedules.

c. The initial deposit toaccompany the Letter of Offer must include 50percent of the administrative surcharge expenseand the cash advance required between LOAacceptance and the first payment due date.Since the LOA illustrated in Table 402-1 wassigned after the billing cut-off date, the timeperiod between acceptance and payment duedate will approximate six months (e.g. for aDecember 20th acceptance, SAAC would not billuntil April for a due date of June 15th). Becauseof the 3-month administrative lead-time, nocontract cost will be incurred until April. Theinitial deposit, therefore, will be necessary onlyto cover the months of April, May, and June.The cumulative percentage of contract cost forthis 3-month period is 1.1%. Applying thispercentage to the contract cost yields an initialdeposit of $8,800-due upon acceptance.

115115


d. The April billing would show $21,600($30,400 - $8,800) as the amount due on June 15to cover the months, July, August, and Septem-ber; the July billing (June cut off) would show$34,400 ($64,800 - $30,400) due on September 15and so on. The payment schedule would reflectthese due dates.

e. The amount of the initialdeposit to be reserved for termination liabilityand contractor holdback is $352. The amount ofthe first bill ($21,600) to be reserved for termina-tion liability and contractor holdback is $8,768($9,120 - $352) and for the second bill $13,560($22,680 - $9,120).

f. Table 402-3 displays thispayment schedule example in the standardTermination Liability Worksheet format. Table402-1 illustrates a payment schedule that in-cludes Section 21 sales in addition to the pro-curement items.

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TABLE 402-1 CUMULATIVE MONTHLY PAYMENT SCHEDULEAND TERMINATION LIABILITY (TL) PERCENTAGES

(As a percentage of Contract Cost)

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117117


TABLE 402-1 CUMULATIVE MONTHLY PAYMENT SCHEDULE AND TERMINATIONLIABILITY (TL) PERCENTAGES (CONTINUED)


Procurement Lead Time 24 Months 27 Months 30 Months 33 Months 36 Months 39 Months

Cumulative Cumulative Cumulative Cumulative Cumulative CumulativeMonthly % Monthly % Monthly % Monthly % Monthly % Monthly %

Month Payments TL Payments TL Payments TL Payments TL Payments TL Payments TL

1 0.4 0 0.3 0 0.3 0 0.2 0 0.2 0 0.2 02 1.2 5 0.9 2 0.8 0 0.6 0 0.5 0 0.5 03 2.4 18 1.8 14 1.5 10 1.2 8 1.1 4 1.0 24 4.0 30 3.1 24 2.6 20 2.0 17 1.8 14 1.6 105 6.0 39 4.7 35 3.9 30 3.1 27 2.7 24 2.4 186 8.5 35 6.6 38 5.4 40 4.4 38 3.8 30 3.3 267 11.5 34 8.9 34 7.2 37 5.9 37 5.0 39 4.4 348 15.2 35 11.7 34 9.4 33 7.6 35 6.5 37 5.6 399 19.6 35 15.0 35 11.9 34 9.6 33 8.1 35 7.0 37

10 24.8 35 18.9 35 14.9 35 11.9 34 10.0 34 8.6 3511 30.7 33 23.4 35 18.3 35 14.6 35 12.2 34 10.4 3412 37.4 32 28.5 34 22.2 35 17.7 35 14.7 35 12.4 3413 44.7 29 34.2 32 26.7 34 21.2 35 17.5 35 14.7 3514 52.4 27 40.4 31 31.6 33 25.1 34 20.6 35 17.3 3515 60.2 22 47.0 29 36.9 31 29.4 33 24.1 35 20.1 3516 67.9 18 53.9 27 42.7 30 34.1 32 27.9 34 23.2 3517 75.3 12 60.9 22 48.8 28 39.2 31 32.1 33 26.6 3418 81.8 7 67.8 18 55.0 26 44.6 29 36.6 32 30.3 3319 87.4 4 74.4 13 61.3 22 50.2 28 41.3 30 34.3 3220 91.9 2 80.4 8 67.5 18 55.9 25 46.3 29 38.6 3221 95.2 1 85.7 5 73.5 13 61.6 22 51.5 27 43.1 2922 97.5 0 90.1 2 79.0 9 67.2 18 56.7 25 47.8 2823 99.1 0 93.6 1 83.9 6 72.6 14 62.0 22 52.6 2724 100.0 0 96.2 1 88.2 3 77.7 10 67.2 18 57.5 2425 98.1 0 91.7 2 82.3 7 72.2 14 62.4 2126 99.4 0 94.5 1 86.4 4 76.9 11 67.2 1827 100.0 0 96.6 1 89.9 2 81.3 7 71.8 1428 98.1 0 92.8 1 85.2 5 76.2 1129 99.3 0 95.1 1 88.6 3 80.3 930 100.0 0 96.9 0 91.5 2 84.0 631 98.2 0 93.9 1 87.3 332 99.2 0 95.9 1 90.2 233 100.0 0 97.4 0 92.7 234 98.5 0 94.7 135 99.4 0 96.3 136 100.0 0 97.6 037 98.6 038 99.4 039 100 0

118118




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.40

95.7

192

.81

5299

.10

96.7

094

.11

5399

.60

97.5

095

.31

5410

0.0

098

.20

96.3

155

98.8

097

.20

5699

.30

98.0

057

100.

00

98.6

058

99.2

059

99.6

060

100.

00

120120


TABLE 402-2 ILLUSTRATION ON USE OF PERCENTAGES TO ESTIMATECASH ADVANCE REQUIREMENTS

(Contract Cost of $800,000 LOA Accepted 12/20/84)4

Payment Schedule3

Amount of TL CurrentMonth Gross % Contract Cost TL % Dollars Quarter CumulativeDec 1984 (Intl Dep)40 0 0 0 8,800 8,800Jan 19851 0 0 0 0 0 0Feb 19851 0 0 0 0 0 0Mar 19851 0 0 0 0 0 0Apr 19852 .2 1,600 0 0 0 0May 1985 .5 4,000 0 0 0 0Jun 1985 1.1 8,800 4 352 21,600 30,400Jul 1985 1.8 14,400 14 2,016 0 0Aug 1985 2.7 21,600 24 5,184 0 0Sep 1985 3.8 30,400 30 9,120 34,400 64,800Oct 1985 5.0 40,000 39 15,600 0 0Nov 1985 6.5 52,000 37 19,240 0 0Dec 1985 8.1 64,800 35 22,680 52,800 117,600Jan 1986 10.0 80,000 34 27,200 0 0Feb 1986 12.2 97,600 34 33,184 0 0Mar 1986 14.7 117,600 35 41,160 75,200 192,800Apr 1986 17.5 140,000 35 49,000 0 0May 1986 20.6 164,800 35 57,680 0 0Jun 1986 24.1 192,800 35 67,480 100,000 292,800Jul 1986 27.9 223,800 34 75,888 0 0Aug 1986 32.1 256,800 33 84,744 0 0Sep 1986 36.6 292,800 32 93,696 119,200 412,000Oct 1986 41.3 330,400 30 99,120 0 0Nov 1986 46.3 370,400 29 107,416 0 0Dec 1986 51.5 412,000 27 111,240 125,600 537,600Jan 1987 56.7 453,600 25 113,400 0 0Feb 1987 62.0 496,000 22 109,120 0 0Mar 1987 67.2 537,600 18 96,768 112,800 650,400Apr 1987 72.2 577,600 14 80,864 0 0May 1987 76.9 615,200 11 67,672 0 0Jun 1987 81.3 650,400 7 45,528 81,600 732,000Jul 1987 85.2 681,600 5 34,080 0 0Aug 1987 88.6 708,800 3 21,264 0 0Sep 1987 81.5 732,000 2 14,640 47,200 779,200Oct 1987 93.9 751,200 1 7,513 0 0Nov 1987 95.9 767,200 1 7,672 0 0Dec 1987 97.4 779,200 0 0 20,800 800,000Jan 1988 98.5 788,000 0 0 0 0Feb 1988 99.4 795,200 0 0 0 0Mar 1988 100.0 800,000 0 0 0 800,000____________________________________________1Administrative lead-time.2Start of 36 months’ procurement lead-time.3Date payment due at SAAC.4The Administrative Surcharge, 50% initial drawdown will be additive to the cash advancerequirements illustrated here.

121121


TABLE 402-3 ILLUSTRATION OF TABLE 401-2 PAYMENT SCHEDULEIN TERMINATION LIABILITY WORKSHEET FORMAT

Contract Cost of $800,000 LOA Accepted 12/20/84(No Sec 21 Sales in LOA)

Termination Liability/Total Payment Estimated Disbursements Contractor Holdback

Date Qtr Cum Qtr Cum Qtr Cum(a) (b) (c) (d) (e) (f)

InitialDeposit 8,800 8,800 8,448 8,448 352 352

15 Jun 85 21,600 30,400 12,832 21,280 8,768 9,12015 Sep 85 34,400 64,800 20,840 42,120 13,560 22,68015 Dec 85 52,800 117,600 34,320 76,440 18,480 41,16015 Mar 86 75,200 192,800 48,880 125,320 26,320 67,480

15 Jun 86 100,000 292,800 73,784 199,104 26,216 93,69615 Sep 86 119,200 412,000 101,656 300,760 17,544 111,240

15 Dec 86 125,600 537,600 140,072 440,832 (14,472) 96,76815 Mar 87 112,800 650,400 164,040 604,872 (51,240) 45,52815 Jun 87 81,600 732,000 112,488 717,360 (30,888) 14,64015 Sep 87 47,200 779,200 61,840 779,200 (14,640) 015 Dec 87 20,800 800,000 20,800 800,000 0 0

Notes:1. Columns a and b should be identical to payment schedule in the LOA.2. Column a = c+e.3. Column b = d+f.4. At end of schedule, column b = column d; column f must be zero.5. This analysis of TL must be performed for all contracts regardless of value and

must be part of a case file but need not be submitted to DSAA unless case value isover 7 million dollars. (See SAMM, Chapter 7 [reference (e)] for guidance regardingsubmission of Termination Liability Worksheets).

122122


TABLE 402-4 ILLUSTRATION OF TABLE 401-2 PAYMENT SCHEDULE INTERMINATION LIABILITY WORKSHEET FORMAT

Contract Cost of $800,000 Plus Sec 21 Sales of $240,000 LOA Accepted 12/20/84

Termination Liability/Total Payment Estimated Disbursements Contractor Holdback

Date Qtr Cum Qtr Cum Qtr Cum(a) (b) (c) (d) (e) (f)

InitialDeposit 28,800 28,800 28,448 28,448 352 35215 Jun 85 41,600 70,400 32,832 61,280 8,768 9,12015 Sep 85 54,400 124,800 40,840 102,120 13,560 22,68015 Dec 85 72,800 197,600 54,320 156,440 18,480 41,16015 Mar 86 95,200 292,800 68,880 225,320 26,320 67,480

15 Jun 86 120,000 412,800 93,784 319,104 26,216 93,69615 Sep 86 139,200 552,000 121,656 440,760 17,544 111,240

15 Dec 86 145,600 697,600 160,072 600,832 (14,472) 96,76815 Mar 87 132,800 830,000 184,040 784,872 (51,240) 45,52815 Jun 87 91,600 922,000 122,488 907,360 (30,888) 14,64015 Sep 87 77,200 999,200 91,840 999,200 (14,640) 015 Dec 87 40,800 1,040,000 40,800 1,040,000 0 0

Notes:1. Columns a and b should be identical to payment schedule in the LOA.2. Column a = c+e.3. Column b = d+f.4. At end of schedule, column b = column d; column f must be zero.5. Reserves are the same as Table 402-3 schedule; however, total payment and

estimated disbursements are greater due to Sec 21 articles/services in case.6. This example only requires an initial deposit for one quarter (reference

paragraph 040302 of this Volume).

123123


0403 PAYMENT SCHEDULES

040301. Policy. It is DoD policy that FMS pur-chasers be requested to pay amounts reflected inLOA payment schedules--except in those instanc-es where potential cash disbursements are antici-pated to exceed the current payment schedule.Assurance that cash is available when the neces-sity for disbursement arises requires that imple-menting DoD Components continually monitorcase level cash advances and validate the accura-cy of payment schedules.

040302. General. Payment schedules are aconsolidated formal presentation to the FMScustomer of the estimates of cash requirementsresulting from application of the procedurescontained in Section 402. If initial deposits arerequired upon acceptance of a sales agreement,the amount of initial deposits should be equal toone half of the administrative surcharge plussufficient funds to cover all costs and contingen-cies (e.g., contract holdback, potential termina-tion liability) anticipated to be incurred until thefirst billing statement can be rendered andmonies collected. As a standard, new salesagreements can enter the billing system at theSAAC through the 10th day of the last month ofthe calendar quarter. Therefore, if a new agree-ment is anticipated to be accepted by the pur-chaser and received by the SAAC after the 10thday of the last month of the quarter, then theDoD Component should require an initial depos-it for the first two calendar quarters of the agree-ment.

040303. LOA Payments

A. LOA Payment requirements will beincluded in each LOA in the format required bythe SAMM [reference (e)]. The payment sched-ule portion of the LOA should be reissued via amodification when costs are expected to varymore than $500,000 during any 12-month periodcovered by the payment schedule. Smallerthresholds should be established where total casevalue warrants.

B. Termination Liability Worksheetswill be furnished to DSAA in accordance withthe SAMM [reference (e)]. DSAA will retain one

copy and forward one copy to the SAAC. SAACwill record the amount of termination liabilityspecified on the worksheets.

040304. Preparation. Any revision to the LOApayment schedule shall be prepared in themanner prescribed in this Volume.

A. It is essential that payment sched-ule revisions be prepared in such a manner thatthey are consistent with the parameters of theFMS billing cycle and their contents are clearlyunderstood by the implementing agency, SAAC,and the FMS customer. Since the paymentschedule is used by SAAC as the basis for billingthe FMS purchaser, there must be an "audit trail"between the original payment schedule and anyrevision(s).

B. The payment dates shown on therevised payment schedule must be compatiblewith the FMS billing cycle. The following guid-ance is applicable:

Anticipated Earliestexpiration/ payment dateimplementa- shown in pay- For costs totion date ment schedule be incurred in

11 Mar-10 Jun 15 Sep Oct-Dec11 Jun-10 Sep 15 Dec Jan-Mar11 Sep-10 Dec 15 Mar Apr-Jun11 Dec-10 Mar 15 Jun Jul-Sep

On an emergency basis, a revised paymentschedule may be provided to SAAC by messageor the committed values for requisition casesreport (see paragraphs 040308 and 080102).However, this means of notification should beused only if a properly executed modificationcannot reach SAAC within the above time-frames. Message notification must be immedi-ately followed by a payment schedule modifica-tion.

C. In as much as payment schedulesare intended to reflect "financial requirements"(which in turn relate to Column 12, Total Finan-cial Requirements, of the DD Form 645), cumula-tive collections/actual payments received fromthe FMS purchaser (as reflected in Column 13 of

124124


the DD Form 645) should not be used in thepreparation of revised payment schedules. Thiscaveat is especially pertinent since the FMSpurchaser may over or under pay its financialrequirements for a given FMS case. In theprocess of preparing the revised payment sched-ule, the following guidelines regarding specificentries are applicable (refer to the illustration inTable 403-2):

1. The "Cumulative to Date(with date specified)" entry is mandatory andmust correspond with the original paymentschedule in the absence of a prior revision;otherwise, the "Cumulative to Date" entry shouldcorrespond to the last revision. This entryensures that all concerned (i.e., implementingagency, SAAC, FMS customer) have a clearunderstanding of the relationship between theoriginal and revised payment schedules.

2. In the event the implementingagency desires to decrease the existing totalfinancial requirements of the FMS case, the"Revised Cumulative to Date" entry is used.This entry will adjust the amount reflected inColumn 12 (Total Financial Requirements) of theDD Form 645.

3. If an "Initial Deposit" isappropriate, such as in the instance of an amend-ment which increases the number of items beingsold, this entry should also be shown.

4. The remaining payment dateentries and associated quarterly and cumulativeamounts are shown, as necessary. The imple-menting agency should ensure that these finalentries correspond to the revised total case value(i.e., Block 13 of amendments and modifications.

040305. Forecasting Procedures. Exceptionalforecasting procedures will be used for requisi-tion cases (i.e., Supply Support Arrangement,FMSO II, and other repair parts cases). Experi-ence has shown that most payment schedules forthese cases tend to be overstated because ofvariations in both requisitioning and supplyactions. Therefore, to preclude substantial over-billing, each implementing agency shall providethe SAAC with a "Quarterly Forecast of FinancialRequirements for In-Process Cases" report and

cards (or card images). These inputs are submit-ted to the SAAC by the 15th day of the lastmonth of each calendar quarter (i.e., March 15,June 15, September 15, and December 15), andreflect the most recent status of logistical com-mitments (on-hand unfilled requisitions). Ifthere are no unfilled orders on the requisitioncase, the implementing agency should report"zero" commitment value-- a report should besubmitted for all requisition cases. See Table403-1 for instructions for preparing the FICS"BK" transaction used for the report.

040306. Committed Values. The committed(unfilled order) values for requisition cases iscompared by the SAAC to the case paymentschedule quarterly amounts. If the committedvalue for the case is less than the quarterlyamount from the payment schedule, the commit-ted value is used for the forecasted requirementin Column 11 of the DD Form 645 in lieu of thepayment schedule amount.

040307. Accurate Payment Schedules. Thisprocedure does not preclude the requirement foran accurate payment schedule to be included inthe LOA for a requisition type case. If anout-of-balance condition continues to exist be-tween quarterly payment schedule amounts andthe committed value provided each quarter, anew payment schedule should be issued by theimplementing agency.

040308. Delivery Status. It is a requirementthat the financial and delivery status of eachFMS case be reviewed periodically by the imple-menting agency. This review is to ascertainwhether the payment schedule will providesufficient cash to meet the requirements estab-lished in paragraph 040102 of this Volume. Ifnot, it shall be necessary to provide SAAC aquarterly forecast of fund requirements thatcontains the case level data normally required asback-up to the payment schedule.

040309. Revising Case Payment Schedules.Implementing agencies will establish formalprocedures for the review and revision of FMScase payment schedules as follows:

125125


A. The payment schedule should beevaluated each time an amendment or modifica-tion is issued that affects case or line values.

B. Payment schedules for cases withperformance extending beyond two years shouldbe reviewed as indicated below:

Total Case Value Review Frequency1. $100 million or less Annually2. $100-$500 million Semi-annually3. $500 million and

above Quarterly

C. If the review discloses that actualdisbursements and payables (see Table 402-2 col-umn "Amount of Contract Cost") vary fromestimated disbursements by more than 10%,implementing agencies should give priority torevising applicable payment schedules.

126126


TABLE 403-1 INSTRUCTIONS FOR PREPARING "BK" TRANSACTIONS, QUARTERLY FORECASTOF FINANCIAL REQUIREMENTS FOR IN-PROCESS CASES

Format/ Edit/Validations of:Data Element Description No. of FICS BKI Input--MILDEP to SAACand Element Abbreviation Position TRC BKF Feedback--SAAC to MILDEP

Document Identifer Code X(3)(DIC)

Case Budgetary Require- '1-3 '002 Originator to recipient; must be BKI if not,ments (Input) reject.

Case Budgetary Require- '1-3 "BKF" - a machine generated duplicate of the ments (Feedback) BKI transaction appended by the Positive Transaction Control (PTC) Transaction Control No. X(13) '152 Must be numeric (0-9)(YYMMDDNNNNNNV) '4-16 '152 YYMMDD must be equal to or less than

current date

'249 Version Number (V) must be "0" ifAction Code is "A" (add)

'248 Version Number (V) must be 1 thru 9 ifAction Code is "C" (change) and must beone greater than suspense version No.

'251 If Action Code is "C" (change) or "D"(delete), Transaction Control number(TCN)(excluding V) must equal suspense file. (YYMMDDNNNNNNV)

Action Code X(1) '003 Must be "A", "C", or "D", otherwise invalid.17 A=Add; C=Change; D=Delete

Country Code (CC) X(2) '037 Must be on Country Code (CC) Table.18-19 If not, reject.

Implementing Agency X(1) '038 If Site Cite = 5 or 6, IA Code must be onCode (IA) 20 Implementing Agency (IA) Table.

127127


TABLE 403-1 INSTRUCTIONS FOR PREPARING "BK" TRANSACTIONS (CONTINUED)

Format/ Edit/Validations of: TransactionsData Element Description No. of FICS BKI Input--MILDEP to SAACand Element Abbreviation Position TRC BKF Feedback--SAAC to MILDEP

Case Designator X(3) '039 MUST be a valid case; if not reject. 21-23 Case must be on the Active case control

file (I) or closed (C) when case is a valid case. Date Forecasted (YYMM) X(4) for Fiscal Year 24-27 Amount Open Requisition S9(12) V99 28-39

THE POSITIVE TRANSACTION CONTROL FEEDBACK CONTAINS THEORIGINAL BKI TRANSACTION PLUS THE FOLLOWING DATA ELEMENTSFOR THE BKF TRANSACTION

Transaction Reply Code X(15) FEEDBACK TRANSACTIONS ONLY. This 15(TRC) 40-54 character element is appended to the feedback

format of all interface transactions by the recipientsystem. This area will contain 1 to 5, 3-digittransaction reply codes to communicate back to theoriginator system the result of processing thetransaction. (Left justified/space filled).

128128


TABLE 403-2 ILLUSTRATIONS OF PAYMENT SCHEDULE REVISIONS

A. Original Estimated Payment Schedule

Payment Date Quarterly CumulativeInitial Deposit $100,000 $100,00015 Mar 198X 90,000 190,00015 Jun 198X 80,000 270,00015 Sep 198X 70,000 340,00015 Dec 198X 60,000 400,00015 Mar 198Y 50,000 450,00015 Jun 198Y 40,000 490,00015 Sep 198Y 30,000 520,00015 Dec 198Y 20,000 540,000

B. Revision No. 1 - Upward Adjustment (Note 1)

Payment Quarterly CumulativeCumulative to Date (15Sep198X) N/A $340,000Initial Deposit (this amendment) 85,000 425,00015 Dec 198X 65,000 490,00015 Mar 198Y 55,000 545,00015 Jun 198Y 45,000 590,00015 Sep 198Y 35,000 625,00015 Dec 198Y 25,000 650,000

C. Revision No. 2 - Downward Adjustment (Note 2)

Payment Quarterly CumulativeCumulative to Date (15Jun198Y) N/A $590,000Revised Cumulative to Date N/A 550,00015 Sep 198Y 15,000 565,00015 Dec 198Y 10,000 575,000

Notes:

1. In Revision No. 1 (due at SAAC not less than 10 Sep 198X), the Cumulative to Date amount of $340,000corresponds to the 15 Sep 198X cumulative amount on the original payment schedule. Since there is noadjustment to the Cumulative to Date amount, there is no need for a Revised Cumulative to Date entry.However, an initial deposit (reflected on the DD 1513-1) is requested and is therefore shown.

2. In Revision No. 2 (due at SAAC not later than 10 Jun 198Y), the Cumulative to Date amount of$590,000 corresponds to the 15 Jun 198Y entry contained in Revision No. 1. Since the implementingagency desires to reduce this amount by $40,000, a Revised Cumulative to Date entry ($550,000) is shown.

129129


0404 CONTRACTOR REQUEST FOR PROG-RESS PAYMENTS AND REIMBURSEMENT OFCOSTS UNDER CONTRACTS INCLUDING FMSREQUIREMENTS

040401. General. Current contracting proce-dures permit the consolidation of DoD and FMScustomer(s) requirements into a single contract.To implement FMS cash flow requirements it isnecessary that an allocation be made of theamount billed to DoD and to each FMS custom-er. The portion of the bill which is applicable toan FMS customer can be paid only to the extentthat the specific customer has deposited a cashadvance into the Department of the Treasury.

040402. Contractor Allocations. The DoD FARSupplement Clause 252.232-7002, Progress Pay-ments for Foreign Military Sales Acquisitions,requires that if DoD contracts include FMSrequirements that the contractor shall:

A. Submit a separate progress pay-ment request for each progress payment rate;and

B. Submit a supporting scheduleshowing:

1. The amount of each requestdistributed to each country’s requirements; and

2. Total price per contract lineitem applicable to each progress payment rate.

C. Identify in each progress paymentrequest the contract requirements to which itapplies (i.e., FMS or U.S.);

D. Calculate each request on the basisof the prices, costs (including costs to complete),subcontractor progress payments, and progresspayment liquidations of the contract require-ments to which it applies; and

E. Distribute costs among contractline items and countries in a manner acceptableto the Administrative Contracting Officer.

040403. Administrative Contracting OfficerAllocations. To the extent that a contractual

requirement has not been established and thecontractor does not allocate costs to the foreigncountries or international organization, theadministrative contracting office shall make suchallocations before approving payment. Whenallocations are required, such allocations shouldnormally be on the basis of actual performance.If it is impractical to estimate actualperformance, the allocation shall be on the basisof simple dollar relationships as described insubparagraphs A. through C. below.

A. The authorized progress paymentpercentages will be applied to the overall con-tract cost to determine the amount of permissibleprogress payments. This amount will not beexceeded.

B. Determine the percentage relation-ship of the unliquidated obligations (ULO) ofeach accounting classification reference number(ACRN) to the total ULO of the contract. Prog-ress payments will be allocated among thevarious funds based upon these percentages.

1. For example, contract has aULO of $600,000. ULO of ACRNs assigned areas follows:

AA $ 50,000AB 50,000AC 100,000AD 100,000AE 300,000

2. The applicable percentages tobe used are:

AA 50/600 or 8.3%AB 50/600 or 8.3%AC 100/600 or 16.7%AD 100/600 or 16.7%AE 300/600 or 50.0%

3. Contract has a progress pay-ment percentage of 90%. The contractor requestsa payment in the amount of $54,000 based onaccrued costs of $60,000. The payment would beprocessed as follows:

AA $54,000 x 8.3% = $ 4,500AB 54,000 x 8.3% = 4,500

130130


AC 54,000 x 16.7% = 9,000AD 54,000 x 16.7% = 9,000AE 54,000 x 50.0% = 27,000

C. Recoupment will be applied firstagainst the line the deliveries are applicable toand the remainder against the outstanding workin process (WIP) on a percentage basis. Forexample, using the figures above an assumingthe recoupment percentage is 90%, the contractorships and invoices for $30,000; $20,000 is applica-ble to ACRN AD and $10,000 is applicable toACRN AE. As 90% of $20,000 or $18,000 exceedsthe outstanding WIP on ACRN AD, only $9,000can be recouped against ACRN AD. Ninetypercent of $10,000 for ACRN AE or $9,000 forAE can be recouped. The remaining $9,000 to berecouped is prorated against the ACRNs withoutstanding WIPs on a percentage basis asfollows:

Original WIP Less WIPACRN Initial Recoupment Remaining

AA 4,500 less 0 = $ 4,500AB 4,500 less 0 = 4,500AC 9,000 less 0 = 9,000AD 9,000 less 9,000 = 0AE 27,000 less

9,000 = 18,000

Computation of Percentages

AA 4,500/36,000 = 12.5%AB 4,500/36,000 = 12.5%AC 9,000/36,000 = 25.0%AD 0/36,000 = 0.0%AE 18,000/36,000 = 50.0%

The total recoupment for this transaction wouldbe as follows:

AA 12.5% of 9,000 = $ 1,125AB 12.5% of 9,000 = 1,125AC 25.0% of 9,000 = 2,250AD 0.0 + 9,000 = 9,000AE 50.0% of 9,000

+9,000 = 13,500

Total $27,000

0405 DEPOSIT OF CUSTOMER CASH INTOTREASURY ACCOUNTS

040501. General. DD Form 645 and LOA finan-cial instructions direct that foreign customer’spayments (initial deposits or billing statementpayments) be forwarded by wire transfer orcheck to the Security Assistance AccountingCenter (SAAC), Defense Finance and AccountingService-Denver Center, Denver, CO 80279-5000.However, these payments are sometimesmisrouted to Office of the Secretary of Defense,Military Departments’ headquarters, internation-al logistics centers, commodity commands, etc.

040502. Receipt of Checks. Any recipient of acheck from an FMS customer is responsible fordepositing the check into a Treasury accountwithin one working day after receipt. When arecipient other than SAAC is making the deposit,the deposit shall be processed as a courtesydeposit for SAAC. The following proceduresapply:

A. Prepare a Treasury Deposit SF 215deposit ticket using DSSN 3801 in block 3,Disbursing Office Symbol (example is at Table405-1).

B. Notify the SAAC Reports andCash Management Division (IR), DSN 926-6006,that a courtesy deposit is being accomplished.Provide the money amount, paying FMS custom-er (for example, Germany), and FMS case num-ber (if available).

C. Process the deposit through aFederal Reserve Bank or supporting memberbank. (Note: Endorse the check showing DSSN3801 as the collecting organization.)

D. Send a copy of the "confirmedcopy" of the SF 215 to DFAS-DE/I (SAAC), 6760East Irvington Place, Denver, CO 80279-2000.Attach supporting documentation that wasreceived with the misrouted payment.

E. SAAC shall voucher the collectioninto the FMS Trust Fund upon receipt of the SF215.

131131


040503. Wire Transfers. In the event inquiriesare received regarding wire transfer of funds toSAAC or misrouted funds to be wire transferred,the following information pertains:

A. Wire transfers should be sent tothe Department of Treasury Account at theFederal Reserve Bank of New York City, usingthe standard Federal Reserve Funds Transfer(FRFT) format. Wire transfers shall be acceptedby the Federal Reserve System (FRS) only frombanks that are members of the FRS. Foreignbanks must go through a U.S. correspondentbank that is a member of the FRS.

B. The member bank shall preparethe FRFT form as outlined in Table 405-2. Thisinformation shall be provided to ensure promptand correct application of the remittance.

C. SAAC retrieves wire transfersdaily from the Treasury Financial Communica-tions Systems (TFCS) and prepares collectionvouchers from this data for crediting FMS cus-tomers.

132132


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ITO

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ET

AIN

TH

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OP

Y F

OR

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NA

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SE

D

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BM

IT T

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TO

DE

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NC

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(11

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EP

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ITA

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DA

TE

SIG

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TU

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DE

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SIT

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A A A

A A A

A A A

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TABLE 405-2 FEDERAL RESERVE FUND TRANSFER FORMAT

(1). To (2). Type (3).'021030004From (4). REF (5). Amount (6).

Amount of this transferOrdering Bank and Related Data (7)

(8) (9) (10)TREAS NYC (3801) DFAS-DE/IR(11).Appropriate information to identify the reason for this funds transfer

Message Acknowledgement

FORMAT FOR FEDERAL RESERVE FUND TRANSFER

Detailed below are the critical data (items 2, 6, 8, 9, 10, 11) the FMS customer or its local bank

must supply to the member bank. It is also shown in the exact way it must appear on the standard

FRFT format. Items 1, 3, 4, 5, and 7 will be completed by the member bank in accordance with

accepted Federal Reserve fund transfer procedures.

Item 1. Priorty Code The priority code will be provided by the member bank.

Item 2. Treasury Department Code

The nine-digit identifier, 021030004, is the symbol of the Federal Reserve Bank of New York City.

Item 3. Type Code The type code will be provided by the member bank.

Item 4. Sending Bank Code This nine-digit identifier will be provided by the member bank.

Item 5. Reference Number

The reference number may be inserted by the member bank to identify the transaction.

Item 6. Amount

The amount will include the dollar sign and the appropriate punctuation, including cents digits.

This item will be provided by the FMS customer or its local bank.

Item 7. Sending Bank Name

The telegraphic abbreviation which corresponds to item 4 will be provided by the sending bank.

Item 8 Treasury Department Name

The telgraphic abbreviation, TREAS NYC, is a constant and is required for all funds transfer messages

sent to Denver. This item must be followed by a slash (/).

Item 9. Agency Location Code.

This code refers to a numeric symbol used to identify Federal

Government entities (e.g., accounting offices, disbursing, and collecting offices).

The agency's unique code must be specified in the funds transfer message in order for the

funds to be correctly classified to the respective agency. The code for SAAC is:

(3801) Defense Finance and Accounting Service.

Item 10. Agency Name

Enter: DFAS-DE/IR immediately after the Agency Location Code.

Item 11. Third Party Information

The appropriate information to identify the reason for the funds transfer should be provided by the

member bank to the FRB. This data must be provided the member bank by the customer or its local bank.

For the USAF F-16 program, incoming wires for currency exchange transactions should also show

the originating contractor and what organization is to receive exchange proceeds.

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0406 EXPENDITURE AUTHORITY

040601. General. Any disbursement of TrustFund cash by an organization other than theSecurity Assistance Accounting Center (SAAC)shall be made only pursuant to an expenditureauthorization issued by SAAC. When SAACissues an expenditure authorization, the cashnecessary to liquidate the expenditure authoriza-tion is formally segregated in the SAAC account-ing records and the cash is available for no otherpurpose. Normally, procurements accomplishedon a reimbursable basis shall be supported by aself-reimbursement expenditure authorization.However, a cash advance to an appropriationaccount must be obtained when a cash disburse-ment for an FMS contract would, if made, resultin the applicable appropriation account beingplaced in a negative cash position.

040602. Self-Reimbursement ExpenditureAuthorizations

A. The SAAC shall issue expenditureauthorizations to disbursing activities whenauthorization to self-reimburse an appropriationfund account has been requested and approved.Each disbursing activity shall establish internalcontrols to ensure that reimbursable paymentsfrom the financing appropriation do not exceedthe current self-reimbursement expenditureauthorization. If an invoice applicable to FMSrequirements is to be processed as a "transactionfor others," expenditure authority shall be ob-tained by the disbursing activity. Accumulateand summarize all FMS payments for reimburs-able work from each financing appropriationaccount through the use of "no check SFs 1080."Forward disbursement and supporting deliverytransactions to SAAC not later than 16 days afterthe last day of the month in which self-reim-bursement occurs.

B. Each DoD Component receivingcontractor invoices shall establish internal con-trols to ensure that payments to contractors fromthe financing appropriation account do note x c e e d t h e c u r r e n t c o u n t r y - l e v e lself-reimbursement expenditure authorization.If an invoice applicable to FMS requirements isto be processed as a "transaction for others,"expenditure authority must be obtained from the

holder of the self-reimbursement expenditureauthorization before disbursement.

040603. Direct Cite Expenditure Authorizations

A. The SAAC shall issue expenditureauthorizations to the disbursing activity. Anyunused expenditure authority shall be returnedto SAAC by the third work day of the followingmonth. Each DoD Component receiving contrac-tor invoices for contracts which reflect the FMSTrust Fund as the financing source shall establishinternal controls to ensure that payments do notexceed the current country level expenditureauthorization. If the invoice is to be processedas a "transaction for others," expenditure authori-ty must be obtained from the holder of theexpenditure authorization prior to disbursement.

B. The status-of-allotment report tobe submitted by holders of an allotment fordirect cite of the FMS Trust Fund (11X8242) oncontractual documents provides for the identifi-cation of disbursements by FMS case and is to besupported by delivery transactions. A reconcilia-tion statement must accompany the status-of-allotment report to identify disbursements thathave been made but not included in the status-of-allotment report.

040604. Procedures. As a minimum, whenexpenditure authorization procedures are used,Heads of DoD Components shall:

A. Ensure procurement instrumentsstate that disbursement of funds is not autho-rized until clearance has been obtained from theholder of the expenditure authorization.

B. Identify the holder of the expendi-ture authorization in the procurement instrumentor other correspondence, if payments are pro-cessed on a "transaction for others" basis.

C. Ensure that paying activitiesrequest authorization prior to makingFMS-related disbursements. Telephone clearancemay be used provided the holder of the expendi-ture authorization formally confirms the authori-zation within 48 hours. Formal confirmation in-cludes memoranda, electronic message, data fax,or overnight mail.

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D. Establish internal controls toensure that payments (direct citation or reim-bursable financing) do not exceed the currentcountry (customer) level authorization.

E. Identify disbursements to a specif-ic FMS Case, reimbursement code, record serialnumber, dollar value and such other informationas necessary to match disbursements to theapplicable delivery transactions.

F. Ensure that procurement accountsare reimbursed within 10 working days after thedisbursement has been recorded in the account-ing activity’s official expenditure records.

040605. Cash Advances. When cash advancesare required, they shall be processed on an "asrequired" basis. The amount requested shall beequal to anticipated disbursing demands for a30-day period. Liquidation of outstandingadvances (earning the advance through paymentto contractors) shall be reported to SAAC month-ly. The objective is to limit the amount andlength of time that outstanding advances remainagainst the Trust Fund.

040606. Cash Flow Problems. In the event acash flow problem results in SAAC’s inability toprovide cash advances or expenditure authoriza-tions and contractor billings cannot be paid bythe due date, the provisions of paragraph070403.B. of Chapter 7 of this Volume shall befollowed.

040607. Automated Formats. Table 406-1 is anexample of the automated format used to re-quest/authorize expenditure authority. The"SZF" (feedback) provides positive transactioncontrol. Other "S" formats in the series are usedto process and control disbursement data.Included in Table 406-1 are particulars of theedits performed on the data. Specific details andinstructions on how this format is used arecontained in the FMS Integrated Control System(FICS) document.

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TABLE 406-1 EXAMPLE OF NOTIFICATION OFEXPENDITURE AUTHORITY REQUEST/FEEDBACK

Format/ Edit/Validations of:Data Element Description No. of FICS SZI Input--MILDEP to SAACand Element Abbreviation Position TRC SZF Feedback--SAAC to MILDEP

Document Identifer Code X(3) '002 Must be "SZI"---MILDEP to SAAC.(DIC) Originator to recipient SZI.

Notification of Expenditure '1-3Authority (Input)

Notification of Expenditure '1-3 "SZF" A machine generated mirror imageAuthority (Feedback) of the SZI transaction and appended with Transaction Reply codes by the Positive Control to become the SZF transaction. Transaction Control No. X(13) '152 Must be numeric(YYMMDDNNNNNNV) '4-16 '152 YYMMDD must be equal to or less than

current date

'249 Version Number (V) must be "0" ifAction Code is "A" (add)

'248 Version Number (V) must be 1 thru 9 ifAction Code is "C" (change) and must beone greater than suspense version No.

'251 If Action Code is "C" (change) or "D"(delete), Transaction Control number(TCN)(excluding V) must equal filesuspense file. (YYMMDDNNNNNNV)

Action Code X(1) '003 Must be "A", "C", or "D"17 A=Add; C=Change; D=Delete

Country Code (CC) X(2) '037 Must equal "OO", "JF", "EP", "FG","79", "82", or be on SAAC's CountryCode Table 2.

Implementing Agency X(1) '038 Must be on SAAC's IA Code Table #7Code (IA) Cannot be "9" or "S".

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TABLE 406-1 EXAMPLE OF NOTIFICATION OFEXPENDITURE AUTHORITY REQUEST/FEEDBACK (CONTINUED)


Case Designator X(3) '039 "91X", "93X", or "94X" or be on the 21-23 Active Case Control History

Date Accounting Month X(4) '281 YYMM must equal to current date(DT-ACCT-MO) 24-27 or one or two prior months. If last five(YYMM) days of current month, YYMM may be Disbursing Station Symbol X(4) No EditNumber (DSSN) '28-31

Accounting Station Symbol X(6) No EditNumber (ASSN) '32-37

Amount of Expenditure S9 (12) '156 Must be numericAuthority Requested V99

38-51

'161 Negative amounts must be processedfirst. There must be sufficient cash inGeneral Ledger Account 1001, AvailableCash, at Country Level Account 1001 isthe second occurrance of money field onGeneral Ledger

Date of Disbursement X(4) '320 YYMM must be equal to or less thanAccounting Month 52-55 current date. Cannot exceed dt-acct-mo.

MM must be 01 thru 12. If last five days of current month YYMM may be

next month.

Disburser's X(1) '038 Must be on SAAC's IA Code Table #3Implementing Agency 56 Cannot be "9" or "S"

Reserve Indicator X(1) No EditYear 56

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TABLE 406-1 EXAMPLE OF NOTIFICATION OFEXPENDITURE AUTHORITY REQUEST/FEEDBACK (CONTINUED)


THE POSITIVE TRANSACTION CONTROL FEEDBACK CONTAINS THEORIGINAL SZI TRANSACTION PLUS THE FOLLOWING DATA ELEMENTSFOR THE SZF TRANSACTION

Transaction Reply Code X(15) FEEDBACK TRANSACTIONS ONLY. This 15(TRC) 58-72 character element is appended to the feedback

format of all interface transactions by the recipientsystem. This area will contain 1 to 5, 3-digittransaction reply codes to communicate back to theoriginator system the result of processing thetransaction. (Left justified/space filled).

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