DoD 7000.14 - R
DEPARTMENT OF DEFENSE
FINANCIAL MANAGEMENT REGULATION
VOLUME 1: “GENERAL FINANCIAL MANAGEMENT
INFORMATION, SYSTEMS AND REQUIREMENTS”
UNDER SECRETARY OF DEFENSE
(COMPTROLLER)
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 1
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VOLUME 1, CHAPTER 1: “CHIEF FINANCIAL OFFICER OF THE DEPARTMENT
OF DEFENSE”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated December 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Administrative updates to include clarifying language in
accordance with Department of Defense Financial
Management Regulation (FMR) Revision Standard
Operating Procedures.
Revision
7.1
The Office of Deputy Comptroller (Program/Budget)
reorganized the Directorate for Integration from a directorate
to an office.
Revision
7.2
Added Deputy Comptroller for Enterprise Financial
Transformation
Addition
7.3.2
Language for the Focus Leadership Execution Team was
incorporated into paragraph 7.3.2.
Revision
Figure 1-1
Updated the Under Secretary of Defense (Comptroller)/CFO
Structure.
Revision
1.2.10,
7.3.2
This revision incorporated part of the Deputy Chief Financial
Officer memorandum titled, “Department of Defense
Component Level Accounts Responsibilities (FPM24-03),”
dated April 9, 2024.
Revision
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 1
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Table of Contents
VOLUME 1, CHAPTER 1: “CHIEF FINANCIAL OFFICER OF THE DEPARTMENT OF
DEFENSE” ..................................................................................................................................... 1
1.0 GENERAL......................................................................................................................... 3
1.1 Purpose ........................................................................................................................... 3
1.2 Authoritative Guidance .................................................................................................. 3
2.0 CHIEF FINANCIAL OFFICER APPOINTMENT .......................................................... 3
3.0 ROLES AND RESPONSIBLITIES .................................................................................. 4
3.1 Financial Management ................................................................................................... 4
3.2 Financial Management Systems ..................................................................................... 4
3.3 Agency Financial Report ................................................................................................ 5
3.4 Budget Execution ........................................................................................................... 5
3.5 Biennial Review ............................................................................................................. 6
4.0 CHIEF FINANCIAL OFFICER AUTHORITY ............................................................... 6
4.1 Title 10 United States Code ........................................................................................... 6
4.2 Title 31 United States Code ........................................................................................... 6
5.0 CHIEF FINANCIAL OFFICERS COUNCIL ................................................................... 7
6.0 ESTABLISHMENT OF THE DEPUTY CHIEF FINANCIAL OFFICER ...................... 7
7.0 DEPARTMENT OF DEFENSE STAFF ORGANIZATIONS ......................................... 7
*7.1 Deputy Comptroller (Program/Budget) ...................................................................... 7
*7.2 Deputy Comptroller for Enterprise Financial Transformation ................................... 8
7.3 Deputy Chief Financial Officer ...................................................................................... 8
7.4 Director, Defense Finance and Accounting Service ...................................................... 9
7.5 Director, Defense Contract Audit Agency ................................................................... 10
8.0 DEPARTMENT OF DEFENSE COMPONENTS ......................................................... 10
*Figure 1-1: UNDER SECRETARY OF DEFENSE (COMPTROLLER)/CHIEF FINANCIAL
OFFICER STRUCTURE .......................................................................................................... 11
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CHAPTER 1
CHIEF FINANCIAL OFFICER OF THE DEPARTMENT OF DEFENSE
1.0 GENERAL
1.1 Purpose
This chapter describes the establishment, roles, responsibilities, and authority of the
Department of Defense (DoD) Chief Financial Officer (CFO) as established by the
CFO Act of 1990. The DoD CFO is also the Under Secretary of Defense (Comptroller) (USD(C).
The USD(C)/CFO is responsible for developing and implementing DoD-wide financial management
systems and overseeing financial management activities relating to CFO programs and operations.
1.2 Authoritative Guidance
The CFO establishment, roles, responsibilities, and authority prescribed are in accordance
with the applicable provisions of the following sources:
1.2.1. Title 10, United States Code, section 192 (10 U.S.C. § 192), “Defense Agencies and
Department of Defense Field Activities: oversight by the Secretary of Defense”;
1.2.2. 10 U.S.C. § 2222, “Defense business systems: business process reengineering;
enterprise architecture; management”;
1.2.3. 31 U.S.C. § 3515, “Financial statements of agencies”;
1.2.4. 31 U.S.C. § 901, “Establishment of agency Chief Financial Officers”;
1.2.5. 31 U.S.C. § 902, “Authority and functions of agency Chief Financial Officers”;
1.2.6. 31 U.S.C. § 903, “Establishment of agency Deputy Chief Financial Officers”;
1.2.7. DoD Directive (DoDD) 5105.36, “Defense Contract Audit Agency”;
1.2.8. DoDD 5118.03, “Under Secretary of Defense (Comptroller)/Chief Financial Officer,
Department of Defense (USD(C)/CFO)”;
1.2.9. DoDD 5118.05, "Defense Finance and Accounting Service (DFAS)"; and
* 1.2.10. DoD Instruction 7000.14, “DoD Financial Management Policy”.
2.0 CHIEF FINANCIAL OFFICER APPOINTMENT
The CFO Act designates DoD as an agency whose CFO is either appointed by the President,
by and with the advice and consent of the U.S. Senate; or designated by the President, in consultation
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with the head of the agency, from among officials of the agency who are required by law to be so
appointed. The USD(C), who is appointed by the President and confirmed by the U.S. Senate, is
also the DoD CFO. The USD(C)/CFO must be appointed or designated, as applicable, from among
individuals who possess demonstrated ability in general management of, knowledge of, and
extensive practical experience in financial management practices in large governmental or business
entities.
3.0 ROLES AND RESPONSIBLITIES
The USD(C)/CFO is the Principal Staff Assistant and advisor to the Secretary of Defense for
budgetary and fiscal matters including financial management, accounting policy and systems,
managers’ internal control systems, budget formulation and execution, contract audit administration
and organization, and general management improvement programs. See Figure 1-1 for the DoD
Chief Financial Officer Structure. Consistent with the CFO Act, the following roles and
responsibilities are assigned to the USD(C)/CFO:
3.1 Financial Management
Direct, manage, and provide policy guidance and oversight of DoD financial management
activities, personnel, and operations, including:
3.1.1. Establish DoD policies including its component parts. Ensure compliance with
applicable accounting policy and standards.
3.1.2. Establish, review, and enforce internal controls, standards, and compliance guidelines.
3.1.3. Provide oversight of activities and operations including: (a) preparation and annual
revision of the Financial Improvement and Audit Remediation (FIAR) plan and (b) development of
financial management budgets.
3.1.4. Prepare and annually revise the DoD plan to implement the 5-year financial
management plan prepared by the Director of the Office of Management and Budget (OMB) and to
comply with the audited financial statements provisions of the CFO Act.
3.1.5. Recruit, select, and train personnel to execute financial management functions.
3.2 Financial Management Systems
Develop and maintain an integrated agency accounting and financial management system,
including but not limited to financial reporting, internal controls, cash management, credit
management, debt collection, and property and inventory management. In coordination with the
Director of Administration and Management (DA&M), provide for the design, development, and
installation of financial systems (as defined in the Glossary) and for management improvement
programs, especially those related to financial management. Ensure system:
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3.2.1. Compliance with applicable accounting principles, standards and requirements, and
internal control standards.
3.2.2. Compliance with Director of OMB policies and requirements.
3.2.3. Provides for:
3.2.3.1. Complete, reliable, consistent, and timely budgetary and proprietary
transaction-level information in accordance with the Standard Financial Information Structure;
and recorded in general ledgers of the accounting systems of record to produce auditable budgetary,
proprietary, and managerial cost accounting reports for external and internal stakeholder use, and
which is responsive to DoD management information needs. All such financial management
systems must establish an Advancing Analytics (Advana) data sharing agreement, see Chapter 10.
3.2.3.2. Development and reporting of cost information.
3.2.3.3. Integration of accounting and budgeting information.
3.2.3.4. Financial and/or program performance data used in budget and financial
statement preparation.
3.2.3.5. Adequate controls over real property, equipment, and inventories.
3.2.3.6. Systematic measurement of performance.
3.3 Agency Financial Report
As required by OMB Circular A-136, DoD must prepare and transmit an Agency Financial
Report (AFR) to the Secretary of Defense, OMB, U.S. Department of the Treasury (Treasury), the
Government Accountability Office, and the Congress. The Department’s AFR preparation and
reporting requirements are identified in Volume 6B.
3.4 Budget Execution
3.4.1. Monitor the financial execution of the DoD budget in relation to actual expenditures,
and prepare and submit to the Secretary of Defense timely performance reports.
3.4.2. Administer and provide analysis and recommendations for the budgeting and
execution phases of the DoD Planning, Programming, Budgeting, and Execution process, utilizing
advice from the Director, Cost Assessment and Program Evaluation and the DA&M.
3.4.3. Direct the formulation and presentation of DoD budgets, the interactions with the
OMB and Congress on budgetary and fiscal matters, and the execution and control of approved
budgets. Maintain effective control and accountability over the use of all DoD financial resources.
In coordination with the DA&M, conduct analyses to increase the efficiency of defense spending.
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3.5 Biennial Review
Review, on a biennial basis, the fees, royalties, rents, and other charges imposed by the
Department for services and things of value it provides, and make recommendations on revising
those charges to reflect costs incurred in providing those services and things of value.
4.0 CHIEF FINANCIAL OFFICER AUTHORITY
4.1 Title 10 United States Code
In accordance with 10 U.S.C. § 2222, the USD(C) in conjunction with the DA&M must,
in consultation with the Defense Business Council (DBC), document and maintain any common
enterprise data for their respective areas of authority. Under this authority, they may also:
4.1.1. Participate in any related data governance process;
4.1.2. Extract defense business systems data as needed for priority activities and analyses;
4.1.3. When appropriate, ensure the source data is the same as that used to produce the
financial statements subject to annual audit;
4.1.4. Provide access, except as otherwise provided by law or regulation, to such data to
the Office of the Secretary of Defense, the Joint Staff, the military departments, the combatant
commands, the Defense Agencies, the DoD Field Activities, and all other DoD offices, agencies,
activities, and commands; and
4.1.5. Maintain consistent common enterprise data of their respective organizations.
4.2 Title 31 United States Code
To carry out CFO duties and responsibilities, the USD(C)/CFO has the authority to:
4.2.1. Access all records, reports, audits, reviews, documents, papers, recommendations,
or other material that are DoD property, are available to the DoD, and which relate to programs
and operations with respect to DoD CFO responsibilities.
4.2.2. Request such information or assistance from any Federal, State, or local
governmental entity as may be necessary.
4.2.3. To the extent and in such amounts as may be provided in advance by appropriations
Acts, the USD(C)/CFO may enter into contracts and other arrangements with public agencies and
with private persons for the preparation of financial statements, studies, analyses, and other
services; and make such payments as may be necessary.
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5.0 CHIEF FINANCIAL OFFICERS COUNCIL
The DoD CFO is a member of the Chief Financial Officers Council (CFOC) consisting of
the Deputy Director for Management of OMB, the Controller of the Office of Federal Financial
Management of OMB, the Fiscal Assistant Secretary of the Treasury, and agency CFOs. The CFOC
meets periodically to advise and coordinate the activities of its agency members on such matters as
consolidation and modernization of financial systems, improved quality of financial information,
financial data and information standards, internal controls, legislation affecting financial operations
and organizations, and other financial management matters.
6.0 ESTABLISHMENT OF THE DEPUTY CHIEF FINANCIAL OFFICER
The CFO Act requires the establishment of DoD Deputy Chief Financial Officer (DCFO),
who must report directly to the DoD CFO on financial management matters. The position of
DCFO must be a career-reserved position in the Senior Executive Service. Consistent with
qualification standards developed by, and in consultation with, the DoD CFO and the Director of
OMB, the Secretary of Defense must appoint as DoD DCFO an individual with demonstrated
ability and experience in accounting, budget execution, financial and management analysis,
systems development, and not less than 6 years practical experience in financial management at
large governmental entities.
7.0 DEPARTMENT OF DEFENSE STAFF ORGANIZATIONS
*7.1 Deputy Comptroller (Program/Budget)
The Deputy Comptroller (Program/Budget) is responsible for overseeing and implementing
budgetary functions within the DoD on a day-to-day basis. The Office of the Deputy Comptroller
(Program/Budget) is organized into four directorates:
7.1.1. The Directorate for Investment is responsible for advising the Deputy Comptroller
(Program/Budget) on all matters pertaining to: Procurement; Research, Development, Test, and
Evaluation; the National Intelligence Program; and for the Defense Acquisition Board program.
7.1.2. The Directorate for Military Personnel and Construction is responsible for advising
the Deputy Comptroller (Program/Budget) on all matters pertaining to operating and maintaining the
U.S. military force structure to include active, reserve, and retired military; Defense Health Program;
military construction; family housing; homeowners assistance; North Atlantic Treaty Organization
infrastructure; Base Realignment and Closure; and Real Property Maintenance.
7.1.3. The Directorate for Operations is responsible for advising the Deputy Comptroller
(Program/Budget) on all matters pertaining to operating and maintaining the U.S. military force
structure to include active and reserve military personnel and civilian personnel. This directorate is
also responsible for advising on all matters pertaining to Contingency and International programs.
7.1.4. The Directorate for Program and Financial Control is responsible for budget review
tracking, the submission of the automated defense budget for the President’s budget, maintenance of
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the budget databases, apportionment of funds, reprogramming and transfer of funds, obligation and
outlay forecasting and tracking, budget concepts and scorekeeping, and information system support.
*7.2 Deputy Comptroller for Enterprise Financial Transformation
The Deputy Comptroller for Enterprise Financial Transformation (EFT) is responsible for
improving enterprise-wide performance and data-driven decision making by accelerating digital
transformation, process improvement, and the use of data and analytics. The Office for EFT is
organized into two directorates:
7.2.1. The Directorate for Digital Transformation (DT) is responsible for the oversight and
management of DoD’s financial management systems environment, including system audit
compliance, and other digital transformation efforts which leverage data, data standards,
technology, and analytics to automate and improve business processes. In alignment to the
National Defense Strategy, DT also leads the development and implementation of DoD CFO’s
Financial Management Functional Strategy to drive alignment with 21st century mission
requirements and re-investment of savings to core DoD missions.
7.2.2. The Directorate for Financial Management Operations and Analysis is responsible
for Defense-wide Working Capital Funds, the Pentagon Reservation Maintenance Revolving
Fund, the Building Maintenance Fund, the Conventional Ammunition Working Capital Fund, the
National Defense Stockpile Transaction Fund, and the Military Services' Management and Trust
Funds. The directorate also supports the migration of all legacy DoD Fund Balance with Treasury
(FBwT) reconciliations into the Advana platform, the ongoing development, operation, and
maintenance of the Department’s FBwT reconciliations with Advana, developing, implementing,
and sustaining the Dormant Account Review Quarterly process, producing a supportable Universe
of Transactions for financial statement line-item balances, analysis and reporting on budgetary and
financial execution data, and executing other Financial Management Analytics missions as needed.
7.3 Deputy Chief Financial Officer
The DCFO is responsible for overseeing and implementing accounting policy, improvements
in financial management, as well as other financial management functions for the DoD on a
day-to-day basis. The Office of the DCFO is organized into two directorates:
7.3.1. The Directorate for FIAR is responsible for audit oversight, management, and liaison
functions; supporting Components to remediate findings and achieve post-audit sustainment. FIAR
develops and annually revises a detailed FIAR Plan that identifies financial process, system, and
statement deficiencies and provides detailed corrective actions to address those deficiencies.
Additionally, FIAR manages the Defense-wide Statement of Assurance process by monitoring and
reporting the status of auditor and manager-identified material weaknesses and corrective action
plans; implementing the Federal Manager’s Financial Integrity Act program for DoD to include
OMB Circular A-123, Appendix A, “Management of Reporting and Data Integrity Risk;” managing
the Improving Financial Performance Initiative of the President’s Management Agenda; and
advocating for the USD(C)/CFO on various interagency forums and internal DoD councils, boards,
committees, and external organizations as required.
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* 7.3.2. The Directorate for Financial Management Policy and Reporting (FMPR) is
responsible for developing, promulgating, implementing, and interpreting DoD-wide accounting
and finance policies; supporting the USD(C)/CFO and DCFO on various interagency forums;
advocating for the USD(C)/CFO on various interagency organizations, and representing the
USD(C)/CFO on various internal DoD councils, boards and committees pertaining to financial
management policy. In addition, FMPR provides oversight of and liaisons with DoD Components
on financial management operations, systems, responses to audit reports, policy clarifications, and
other financial matters; and administers this Regulation. The Directorate develops and issues the
DoD AFR (see Volume 6B), oversees the DoD-wide consolidated financial statements and notes—
to include Component Level Account transactions—and manages the DoD Payment Integrity and
Antideficiency Act programs, and other external financial reporting. Additionally, the Directorate
supports the CFO and DCFO’s strategic vision for a strong internal control environment by
facilitating DoD implementation of large-scale, end-to-end financial and business process and/or
system adoption, and removing barriers from DoD, other federal, and industry stakeholders for
more efficient interoperable systems, data standards, and Government-wide accounting best
practices.
7.4 Director, Defense Finance and Accounting Service
The Director of DFAS is the principal DoD executive for finance and accounting
requirements, systems, and functions under the authority and direction of the USD(C). DFAS:
7.4.1. Directs and oversees finance and accounting requirements, systems, and functions for
all appropriated, nonappropriated, working capital, revolving, and trust fund activities, including
security assistance.
7.4.2. Establishes and enforces requirements, principles, standards, systems, procedures,
processes, and practices necessary to comply with finance and accounting statutory and regulatory
requirements applicable to the DoD.
7.4.3. Provides professional finance and accounting services for DoD Components and other
Federal agencies, as designated by the USD(C)/CFO.
7.4.4. Directs the consolidation, standardization, and integration of finance and accounting
requirements, functions, procedures, operations, and systems and ensures proper relationship with
other DoD functional areas (e.g., budget, personnel, logistics, acquisition, and civil engineering).
7.4.5. Executes statutory and regulatory financial reporting requirements and provides
financial statements, pursuant to 31 U.S.C. § 3515, to include supporting customers’ audit
assertions and audit execution.
7.4.6. Provides advice and recommendations to the USD(C)/CFO on finance and accounting
matters and provides documentation that discloses the internal controls within DFAS-assigned
systems that may impact customers’ control environment in supporting auditability.
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7.4.7. Coordinates on the establishment of all DoD finance and accounting activities
independent of the DFAS and supports the development and implementation of a compliant
business solution with common business processes and data standards for horizontal end-to-end
processes in the Business Enterprise Architecture.
7.5 Director, Defense Contract Audit Agency
The Director of Defense Contract Audit Agency (DCAA) is under the authority, direction,
and control of the USD(C)/CFO, pursuant to 10 U.S.C. § 192, DoDD 5118.03, and DoDD 5105.36.
The Director exercises authority, direction, and control over DCAA and all assigned resources.
DCAA performs all necessary DoD contract audits and provides accounting and financial advisory
services regarding contracts and subcontracts. DCAA executes the following:
7.5.1. Assists procurement and contract administration officials in achieving the objective
of prudent contracting by providing financial information and advice on proposed or existing
contracts and contractors, as appropriate.
7.5.2. In accordance with Government Auditing Standards, the Federal Acquisition
Regulation, the Defense Federal Acquisition Regulation Supplement (DFARS), and other
applicable laws and regulations, to the extent and manner considered necessary, to permit proper
performance of the other functions; DCAA audits, examines, and reviews:
7.5.2.1. Contractors’ and subcontractors’ records, documents, and other evidence;
7.5.2.2. Systems of internal control;
7.5.2.3. Compliance with regulations; and
7.5.2.4. Accounting, costing and general business practices and procedures.
7.5.3. Audits compliance with DFARS Contractor Business Systems Clauses for
contractors' accounting, material management and accounting, and estimating systems.
7.5.4. Directs audit reports to the Government management level having authority and
responsibility to act on the audit findings and recommendations.
7.5.5. As an advisor, attends and participates, as appropriate, in contract negotiation and
other meetings where contract costs, audit reports, or related financial matters are under
consideration.
8.0 DEPARTMENT OF DEFENSE COMPONENTS
The Heads of the DoD Components must direct and manage financial management activities
within their respective Components, consistent with the policies, requirements, principles, standards,
procedures, and practices prescribed by the USD(C)/CFO, and other internal policies as prescribed
by the Heads of the other DoD Components.
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*Figure 1-1: UNDER SECRETARY OF DEFENSE (COMPTROLLER)/CHIEF FINANCIAL OFFICER STRUCTURE
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VOLUME 1, CHAPTER 2: “FEDERAL ACCOUNTING STANDARDS HIERARCHY”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated May 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
This chapter is certified as current. No revision necessary. Current
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Table of Contents
VOLUME 1, CHAPTER 2: “FEDERAL ACCOUNTING STANDARDS HIERARCHY” ........ 1
1.0 GENERAL......................................................................................................................... 3
1.1 Overview ........................................................................................................................ 3
1.2 Purpose ........................................................................................................................... 3
1.3 Authoritative Guidance .................................................................................................. 3
2.0 HIERARCHY .................................................................................................................... 4
2.1 Hierarchy of Accounting Standards ............................................................................... 4
2.2 Other Pronouncements and Practices ............................................................................. 5
3.0 COMMUNICATION AND COORDINATION ............................................................... 5
3.1 Guidance and Clarification ............................................................................................. 5
3.2 Correspondence .............................................................................................................. 5
3.3 Task Force Participation................................................................................................. 6
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CHAPTER 2
FEDERAL ACCOUNTING STANDARDS HIERARCHY
1.0 GENERAL
1.1 Overview
The Federal Accounting Standards Advisory Board (FASAB) is the body designated by
the American Institute of Certified Public Accountants (AICPA) as the source of generally
accepted accounting principles (GAAP) for federal reporting entities. As such, the FASAB is
responsible for identifying the sources of accounting principles and providing federal entities with
a framework for selecting the principles used in the preparation of general purpose financial reports
that are presented in conformity with GAAP. FASAB promulgates accounting standards for U.S.
government agencies after considering financial and budgetary information needs of Congress,
executive agencies, and other users of federal financial information. FASAB considers comments
from the public on its proposed Statements, which are widely distributed as “exposure drafts.”
FASAB publishes adopted statements as Statement of Federal Financial Accounting Standards
(SFFAS) that become GAAP for federal government entities. FASAB Standards and other FASAB
authoritative publications, including FASAB Interpretations, Technical Bulletins, and Technical
Releases are published on the FASAB website. Documents recently issued and not yet codified are
also presented at this location.
1.2 Purpose
1.2.1. This chapter includes the FASAB hierarchy of accounting principles and standards.
These standards are used to promulgate accounting and financial reporting policy within the
Department of Defense (DoD) Financial Management Regulation (FMR). The purpose of these
principles and standards is to improve the usefulness of federal financial reports.
1.2.2. The provisions of this chapter apply to all DoD Components, including the Defense
Working Capital Fund activities. However, this chapter does not apply to Nonappropriated Fund
(NAF) accounting. NAF accounting policies are in Volume 13.
1.2.3. Interim policies and guidance issued by the Office of the Under Secretary of
Defense (Comptroller) (OUSD(C)) through various memoranda can be found on the OUSD(C)
DoD FMR website. Such interim guidance will be incorporated into the DoD FMR once it is
finalized.
1.3 Authoritative Guidance
1.3.1. The Chief Financial Officers (CFO) Act of 1990, as amended, requires federal
financial managers, accountants and auditors to apply appropriate accounting principles and
standards.
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1.3.2. FASAB develops accounting standards and principles for the United States
Government.
1.3.3. The AICPA Code of Professional Conduct, Part 1.320.020 recognized FASAB as
the board that promulgates GAAP for federal entities.
1.3.4. SFFAS 34 “The Hierarchy of Generally Accepted Accounting Principles, Including
the Application of Standards Issued by the Financial Accounting Standards Board” identifies the
GAAP hierarchy for federal reporting entities.
1.3.5. The Government Management Reform Act of 1994 (GMRA) mandates executive
agencies prepare their financial statement in accordance with GAAP.
2.0 HIERARCHY
2.1 Hierarchy of Accounting Standards
2.1.1. The SFFASs are GAAP applicable to the federal government and must be followed
by all federal agencies in reporting under the GMRA. DoD Components must adhere to the GAAP
hierarchy prescribed in SFFAS 34. The sources of accounting principles that are generally
accepted are categorized in descending order of authority as follows:
2.1.1.1. FASAB SFFAS and Interpretations;
2.1.1.2. FASAB Technical Bulletins and, if specifically made applicable to federal
reporting entities by the AICPA and cleared by FASAB, AICPA Industry Audit and Accounting
Guides. Such pronouncements specifically made applicable to federal reporting entities are
presumed to have been cleared by FASAB, unless the pronouncement indicates otherwise;
2.1.1.3. Technical Releases of the Accounting and Auditing Policy Committee
(AAPC) of the FASAB; and
2.1.1.4. Implementation guides published by FASAB staff, as well as practices that
are widely recognized and prevalent in the federal government.
2.1.2. If the accounting treatment for a transaction or event is not specified by a
pronouncement or established in practice as described in subparagraph 2.1.1., a federal reporting
entity should first consider accounting principles for similar transactions or events within
categories in subparagraphs 2.1.1 before considering Other Accounting Literature discussed in
paragraph 2.2.
2.1.3. A federal reporting entity should not follow the accounting treatment specified in
accounting principles for similar transactions or events in cases in which those accounting
principles either, (a) specifically prohibit the application of the accounting treatment to the
particular transaction or event or (b) indicate that the accounting treatment should not be applied
to other transactions or events by analogy.
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2.2 Other Pronouncements and Practices
2.2.1. Other Accounting Literature includes
2.2.1.1. FASAB Concepts Statements;
2.2.1.2. AICPA Industry Audit and Accounting Guides that have not specifically
been made applicable to federal reporting entities by FASAB;
2.2.1.3. Pronouncements of other accounting and financial reporting standards-
setting bodies, such as Financial Accounting Standards Board, Governmental Accounting
Standards Board, the International Accounting Standards Board, and the International Public
Sector Accounting Standards Board;
2.2.1.4. Publications of professional associations or regulatory agencies; and
2.2.1.5. Accounting textbooks, handbooks, and articles.
2.2.2. The appropriateness of other accounting literature depends on its relevance to
particular circumstances, the specificity of the guidance, and the general recognition of the issuer
or author as an authority. FASAB Concepts Statements would normally be more influential than
other sources in this category.
3.0 COMMUNICATION AND COORDINATION
3.1 Guidance and Clarification
To ensure the consistent application of SFFAS throughout DoD, the OUSD(C), Office of
the Deputy Chief Financial Officer (ODCFO), Financial Management Policy and Reporting
(FMPR) Directorate must be contacted when clarification, technical guidance, implementation
guidance or other information regarding federal accounting standards is needed.
3.2 Correspondence
3.2.1. Formal and informal requests addressed to FASAB or the AAPC for an
interpretation, clarification, technical guidance, implementation guidance or other information
regarding SFFAS must be submitted through the OUSD(C), ODCFO, FMPR Directorate.
3.2.2. All correspondence presenting a DoD position on FASAB Exposure Drafts and on
any other matters before FASAB or the AAPC will be signed by either the DoD CFO, DCFO or
ADCFO.
3.2.3. Individuals submitting responses to exposure drafts will clearly indicate in the
correspondence that the opinions expressed are those of the individual and do not represent the
official position of DoD.
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3.2.4. The Office of the Director of National Intelligence (ODNI) is not a component of
DoD and, accordingly, may communicate with accounting standards-setting bodies in the same
manner as other federal agencies. DoD components, including the Defense Intelligence Agency,
the National Geospatial-Intelligence Agency, and the National Security Agency, provide input into
ODNI correspondence with accounting standards-setting bodies. DoD Components should ensure
that ODNI communications are not presented as official DoD positions. Further, to ensure the
completeness of DoD communications, any DoD component input into ODNI correspondence
with accounting standards-setting bodies should be coordinated with the ODCFO.
3.3 Task Force Participation
3.3.1. Full participation by DoD in Task Forces sponsored by FASAB and the AAPC is
critical to ensuring that DoD’s views are considered as accounting standards and guidance are
formulated. This participation includes Task Force membership, meeting attendance, participation
in group discussions, preparing draft documents, and commenting on draft Task Force documents.
3.3.2. To ensure complete coverage by DoD, Task Force participants should notify the
OUSD(C), ODCFO, Financial Improvement and Audit Remediation, and FMPR Directorates of
membership in FASAB and AAPC Task Forces. Task Force participants should also remain alert
to the fact that many issues will impact multiple DoD Components. Coordination with the FMPR
Directorate and other DoD components will ensure that DoD is properly represented as
government-wide accounting standards are formulated.
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VOLUME 1, CHAPTER 3: “FEDERAL FINANCIAL MANAGEMENT
IMPROVEMENT ACT COMPLIANCE”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated October 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Streamlined to remove instructional language.
Revision
1.1
Added interdependencies between Federal Financial
Management Improvement Act and other compliance
requirements.
Addition
2.0
Revised definitions.
Revision
3.3
Revised and streamlined description of Compliance
Determination Framework.
Revision
4.0
Streamlined to remove instructional language.
Revision
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Table of Contents
VOLUME 1, CHAPTER 3: “FEDERAL FINANCIAL MANAGEMENT IMPROVEMENT ACT
COMPLIANCE” ............................................................................................................................. 1
1.0 GENERAL......................................................................................................................... 3
*1.1 Overview .............................................................................................................. 3
1.2 Purpose ................................................................................................................. 3
1.3 Authoritative Guidance ........................................................................................ 3
*2.0 DEFINITIONS ............................................................................................................... 4
2.1 Financial Management System ............................................................................ 4
2.2 Core Financial System ......................................................................................... 4
3.0 ACCOUNTING STANDARDS ........................................................................................ 5
3.1 System Transactions ............................................................................................. 5
3.2 FFMIA Compliance ............................................................................................. 5
*3.3 Compliance Determination Framework ............................................................... 6
*4.0 RESPONSIBILITIES ..................................................................................................... 6
4.1 Office of the Under Secretary of Defense (Comptroller) ..................................... 6
4.2 Director of Administration and Management ...................................................... 8
4.3 Components .......................................................................................................... 8
4.4 Service Organizations .......................................................................................... 9
4.5 Inspector General ................................................................................................. 9
4.6 Hosting Organizations .......................................................................................... 9
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CHAPTER 3
FEDERAL FINANCIAL MANAGEMENT IMPROVEMENT ACT COMPLIANCE
1.0 GENERAL
*1.1 Overview
The Federal Financial Management Improvement Act of 1996 (FFMIA) is intended to
ensure Federal financial systems provide reliable, consistent and uniform disclosure of financial
data using accounting standards. FFMIA requires the Department of Defense (DoD or
Department) to implement and maintain financial systems that comply with Federal Financial
Management System Requirements (FFMSR), applicable Federal accounting standards, and the
United States Standard General Ledger (USSGL) at the transaction level. FFMIA requires DoD
management to annually assess and DoD auditors to report on the Department’s compliance as
part of financial statement audit reports; and determine, based on the audit report and other
information, whether the Department’s financial management systems substantially comply with
FFMIA and, if not, to develop remediation plans as applicable.
While FFMIA compliance centers on these three standards, it is not limited to them. For
example, certain FFMSR are interrelated to and depend on other standards and requirements
underpinning the Federal Managers' Financial Integrity Act, the Agency Chief Financial Officers
(CFO) Act, the Federal Information Security Management Act of 2002 (FISMA), and Office of
Management and Budget (OMB) Circular A-123 requirements.
1.2 Purpose
This chapter prescribes the Department’s policy for achieving compliance with FFMIA. It
provides the basis for the implementation of FFMIA in order for the Department to generate timely,
accurate, and useful financial information with which the Department leadership can make
informed decisions and to ensure accountability on an ongoing basis.
1.3 Authoritative Guidance
The requirements prescribed by this chapter are in accordance with the applicable
provisions of:
1.3.1. Title 10, United States Code, section 2223(a)(5) (10 U.S.C. § 2223(a)(5))
“Information technology: additional responsibilities of Chief Information Officers”
1.3.2. 31 U.S.C § 1115 “Federal Government and agency performance plans.”
1.3.3. 31 U.S.C. § 3512, “Executive agency accounting and other financial management
reports and plans”; with emphasis on sections 801 – 807 (FFMIA).
1.3.4. 31 U.S.C. Chapter 9 “Agency Chief Financial Officers.”
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1.3.5. 44 U.S.C. Chapter 35, Subchapter III “Confidential Information Protection and
Statistical Efficiency.
1.3.6. 44 U.S.C. §3601, “Definition.”
1.3.7. OMB Bulletin No. 22-01, “Audit Requirements for Federal Financial Statements.”
1.3.8. OMB Circular A-123, Appendix D, "Management of Financial Management
Systems – Risk and Compliance.”
1.3.9. OMB Circular A-130, Appendix I, “Responsibilities for Protecting and Managing
Federal Information Resources.
1.3.10. Statement on Standards for Attestation Engagements No. 18,
(SSAE 18, AT-C Section 320) “Reporting on an Examination of Controls at a Service
Organization Relevant to User Entities’ Internal Control Over Financial Reporting.”
1.3.11. National Institute of Standards and Technology
(NIST) Special Publication 800-53, Revision 5, “Security and Privacy Controls for Information
Systems and Organizations.
1.3.12. U.S. Department of Treasury Financial Manual, Volume 1, Part 6, Chapter 9500
(1 TFM 6-9500), “Revised Federal Financial Management System Requirements for Fiscal
Reporting”
1.3.13. DoD Instruction (DoDI) 8510.01,”Risk Management Framework (RMF) for DoD
Systems”
*2.0 DEFINITIONS
2.1 Financial Management System
Financial management systems include the financial systems and the financial portions of
mixed systems necessary to support financial management, including automated and manual
processes, procedures, controls, data hardware, software, and support personnel dedicated to the
operation and maintenance of system functions. Both financial systems and mixed systems may
directly or indirectly trigger a financial event within the system itself or in another system, and
may be required to comply with some or all FFMSR.
2.2 Core Financial System
Core financial systems and financial systems are synonymous terms and consist of six
functional areas: general ledger management, funds management, payment management,
receivable management, cost management, and financial reporting. Core financial systems are
comprised of one or more software programs (commonly referred to as applications), that are used
for:
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2.2.1. Collecting, processing, maintaining, transmitting, or reporting data about financial
events;
2.2.2. Supporting financial planning or budgeting activities;
2.2.3. Accumulating and reporting costs information; or
2.2.4. Supporting the preparation of financial statements.
3.0 ACCOUNTING STANDARDS
3.1 System Transactions
3.1.1. The Department’s financial management systems must maintain accounting data at
the transaction level. Financial management systems include both financial and mixed systems.
All DoD financial events (budgetary and proprietary) must be recorded applying the requirements
of the USSGL guidance in the TFM, and DoD USSGL transaction library (See Chapters 4 and 7
for additional guidance).
3.1.2. Every financial relevant business event that results in an automated transaction in a
core financial system must general accurate and compliant postings to all relevant budgetary and
proprietary general ledger accounts according to the rules defined in the DoD USSGL transaction
library guidance.
3.2 FFMIA Compliance
In determining whether the Department’s financial management systems substantially
comply with FFMIA, management and auditors must consider the degree to which a system’s
performance prevents the Department from meeting the specific requirements of FFMIA as listed
in paragraph 1.1. A system may be determined to be substantially compliant with FFMIA when it
meets the requirements described in OMB Circular A-123, Appendix D, Attachment 1.
3.2.1. The DoD strategy for FFMIA compliance is integrated with related efforts to
achieve auditability and maintain effective Internal Control over Reporting (ICOR) including
Internal Control over Financial Reporting (ICOFR). Documentation that supports these related
requirements also support FFMIA compliance and may be used to avoid duplication of efforts.
3.2.2. The DoD ICOFR Guide serves as a standard reference for users involved in
financial reporting internal control activities within the DoD. This includes the annual
requirements prescribed in the OMB Circular A-123, the FFMIA, and other applicable laws,
regulations, and guidance. Its companion, the DoD Financial Statement Audit Guide is a
reference for supporting internal controls based financial statement audits. A system is subject to
FFMIA if it is determined to be ICOFR relevant as defined in the DoD ICOFR Guide and performs
any business functions aligned to FFMIA compliance requirements, including the FFMSR.
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3.2.3. The DoD ICOFR Guide identifies the specific Federal Information System Controls
Audit Manual (FISCAM) control activities and techniques needed to address the key ICOR risk
areas most likely to impact financial reporting based on the DoD’s experience. The remaining
FISCAM control activities (identified as “Other Control Techniques for Consideration in a
Financial Statement Audit”) should be considered by Components when evaluating federal
financial systems’ compliance with laws and regulations, such as FFMIA and FISMA.
*3.3 Compliance Determination Framework
FFMIA Compliance Determination Framework (Framework) assists in providing
incremental steps and is designed to walk the user from goal through risk assessment, to
conclusion. The risk-based Framework assesses the financial systems integrity risk to comply
substantially with FFMIA Section 803(a) requirements. The Framework includes performance
results based on annual financial statements, the "Federal Financial Management System
Requirements" contained in 1 TFM 6-9500, and other information considered relevant and
appropriate. The Framework goals and compliance indicators must to be used during the ongoing
operation of the Department’s financial management systems. (See OMB Circular A-123,
Appendix D, Attachment 1 for additional guidance). The DoD ICOFR Guide defines mandatory
practices for maintaining auditability subsequent to assertion and validation. These same practices
must be applied to maintain compliance with FFMIA requirements.
*4.0 RESPONSIBILITIES
The responsibilities identified in this section are limited to those specific to FFMIA
compliance and are not meant to be an exhaustive list of all of the responsibilities of these entities.
This includes the authorities and framework that the Department employs to monitor, analyze,
validate, integrate, and control FFMIA compliance requirements.
4.1 Office of the Under Secretary of Defense (Comptroller)
4.1.1. The Office of the Under Secretary of Defense (Comptroller) (OUSD(C)) is
supported by the Enterprise Financial Transformation (EFT), the Financial Improvement and
Audit Remediation (FIAR) Directorate and the Financial Management Policy and Reporting
(FMPR) Directorate. OUSD(C) is responsible for providing a Department-wide assessment of
compliance with the requirements of FFMIA.
4.1.1.1. If the Component financial management systems do not substantially
comply with the requirements of Section 803(c), the FFMIA requires that a remediation plan be
developed, in consultation with OMB that describes the resources, remedies, and milestones for
achieving substantial compliance.
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4.1.1.2. OUSD(C) must annually report to OMB the progress made towards
resolving identified deficiencies and such progress must be discussed in the Components
remediation plan, capital planning and investment control plans, and other planning documents,
when applicable. The findings or analysis of noncompliance must be included with a discussion
of ongoing remediation activities. Progress towards resolving the deficiencies must not be
construed as compliance with FFMIA.
4.1.1.3. Remediation plans are expected to bring the Department’s financial
management systems into substantial compliance no later than three years after the date a non-
compliance determination is made by OUSD(C) or its auditors. However, if OUSD(C), with the
concurrence of OMB, determines that the Department’s financial management systems cannot be
brought into substantial compliance within three years, the Component (in consultation with
OUSD(C)) may specify a longer period. In either case, the Component must designate a
Component official responsible for bringing the Component’s financial management systems into
substantial compliance by the date specified and for reporting progress to EFT (acting on behalf
of the Defense Business Systems Committee) on a scheduled basis.
4.1.2. EFT:
The Organization of EFT governs the DoD Advancing Analytics (Advana)
repository of common enterprise data. See Chapter 10 for additional information about how EFT
uses Advana to support FFMIA compliance activities. EFT also acquires, incorporates, and
standardizes data to support the business domain areas that align with the organizational structure
of the Department. As a result, EFT provides reasonable assurance to consumers that data controls
are clearly defined and executed in accordance with FFMIA.
4.1.3. FIAR Directorate
The FIAR Directorate develops, publishes, and issues detailed financial
improvement audit strategies, methodologies, and implementation guidance. The FIAR Director,
monitors reporting entity FFMIA assertions made and provides internal control training to
reporting entities on improving compliance with FFMIA. As a result, the FIAR Directorate,
improves the quality of the financial information, with a positive audit opinion as the desired
outcome.
4.1.4. FMPR Directorate
The FMPR Directorate develops, publishes, implements, and interprets DoD-wide
accounting and finance policies; ensures the DoD Financial Management Regulation (DoD
7000.14-R) is consistent with laws and other applicable guidance. The FMPR Directorate, leads
and oversees DoD financial integrity. As a result, FMPR develops, publishes, and interprets DoD-
wide financial management improvements and guidance that supports statutory requirements for
the Department to audit its full set of financial statements.
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4.2 Director of Administration and Management
The Director of Administration and Management (DA&M) is the principal management
office for the Secretary of Defense responsible for optimizing the business environment across the
DoD enterprise. The DA&M delivers premier program management and oversight, security
services, and support functions that enable uninterrupted operations of the Department
Headquarters.
4.3 Components
4.3.1. Components must establish and maintain financial management systems that
substantially comply with FFMIA Section 803(c) requirements. Component systems must be
developed to generate reliable, timely and consistent information necessary for the Department to
comply with FFMIA requirements. DoD systems must have the ability to prepare accurate,
reliable, and timely financial statements and other required financial and budget reports using
information generated by the financial management systems. Component management must
annually test financial management systems for FFMIA compliance as required by OMB Circular
A-123, Appendix D.
4.3.2. Components must maintain records of systems and transactional data to comply
with FFMIA, financial statement audits, ICOFR, and Internal Control over Financial Systems in:
4.3.2.1. DoD Information Technology Portfolio Repository (DITPR).
Components must ensure their financial system portfolio is accurately reported in DITPR. DoD
financial systems must review, report, and update appropriately all DITPR FFMIA reporting
requirements and DoD business enterprise architecture operational activity assertions that align to
federal financial management functions on an annual bases in accordance with
10 U.S.C. § 2223(a)(5).
4.3.2.2. FIAR Systems Database (FSD). Components must utilize FSD to identify,
capture, and report on the universe of financially-relevant systems for audits, executive leadership,
and Congressional reporting requirements. Owners of each system must maintain the current
status of FFMIA compliance in FSD to support annual FFMIA compliance and Department’s
Annual SOA reporting.
4.3.2.3. Advana. Components must provide EFT with periodic (minimum
quarterly) budgetary and proprietary transactional data for uploading to Advana. See Chapter 10
for additional information.
4.3.3. Components must use 1 TFM 6-9500 in the pre-acquisition, acquisition, and
implementation of new financial management solutions (manual or automated). These federal
financial management system requirements establish uniform financial systems, standards, and
reporting that support the achievement of the DoD financial reporting objectives. In addition,
Components must use the Federal Financial Management System Requirements in accordance
with OMB Circular A-123.
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4.3.3.1. Develop a plan in accordance with OMB Circular A-130, Appendix I.
4.3.3.2. Ensure the system portfolio and remediation plans are consistent with
modernization priorities identified in 44 U.S.C. §3601.
4.3.4. Assess internal controls over business processes as well as Information Technology
General Controls (ITGC) and IT Application Controls.
4.3.5. Conduct FFMIA certification testing using the Government Accountability Office
(GAO) Financial Audit Manual, DoD ICOFR Guide, 1 TFM 6-9500 and DoD Financial Statement
Audit Guide, leveraging existing system development life-cycle activities where appropriate.
4.4 Service Organizations
Service Organizations must develop and maintain FFMIA compliance remediation plan in
coordination with DoD Components. For each financial system and mixed system managed by
Service Organizations a Memorandum of Agreement (MOA) must be established with each DoD
Component. As part of the MOA, compliance testing must be conducted to support Component
end-to-end business process testing. Service Organizations must provide Components with a
Report on Controls at a Service Organization Relevant to User Entities' Internal Control over
Financial Reporting and also known as a System and Organizational Controls 1 (SOC 1 Report).
The SOC 1 Report evaluates the effect of the controls at the service organization on the user
entities' controls for financial reporting.
4.5 Inspector General
The Office of the Inspector General performs FFMIA compliance evaluations as part of
financial statement audits and/or oversees evaluations performed by independent public
accounting firms during financial statement audits. This includes identifying in writing the nature
and extent of non-compliance when appropriate. Inspector General reports to Congress instances
and reasons when the Department has not met the intermediate target dates established in the
remediation plan required under FFMIA Section 803(c).
4.6 Hosting Organizations
Hosting Organizations provide application hosting services for the DoDs service providers.
As a result, hosting organizations are responsible for most of the ITGC over the computing
environment in which many financial, personnel, and logistics applications reside. In order for
service providers and components to rely on automated controls and documentation within these
applications, controls must be appropriately and effectively designed.
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VOLUME 1, CHAPTER 4: “STANDARD FINANCIAL INFORMATION
STRUCTURE”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated October 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Administrative updates in accordance with Department of
Defense Financial Management Regulation Revision
Standard Operating Procedures.
Revision
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Table of Contents
VOLUME 1, CHAPTER 4: “STANDARD FINANCIAL INFORMATION STRUCTURE” ..... 1
1.0 GENERAL......................................................................................................................... 3
1.1 Overview ........................................................................................................................ 3
1.2 Purpose ........................................................................................................................... 3
1.3 Authoritative Guidance .................................................................................................. 3
2.0 DEFINITIONS .................................................................................................................. 5
2.1 Business Enterprise Architecture ................................................................................... 5
2.2 Financial Management System Types............................................................................ 5
2.3 Investment Review Process ............................................................................................ 6
2.4 SFIS Business Rules ...................................................................................................... 6
2.5 SFIS Compliance Checklist ........................................................................................... 6
2.6 SFIS Values Library Service .......................................................................................... 6
2.7 Standard Data ................................................................................................................. 6
2.8 SLOA/Accounting Classification ................................................................................... 7
3.0 COMPLIANCE REQUIREMENTS ................................................................................. 7
3.1 SFIS ................................................................................................................................ 7
3.2 SLOA/Accounting Classification ................................................................................... 7
3.3 Interoperability of Data between Systems ..................................................................... 8
3.4 Defense Departmental Reporting System SFIS Trial Balance....................................... 8
4.0 ROLES AND RESPONSIBILITIES ................................................................................. 8
4.1 Office of the Under Secretary of Defense (Comptroller) ............................................... 8
4.2 Office of the Chief Information Officer ......................................................................... 8
4.3 DoD Components ........................................................................................................... 9
4.4 Defense Finance and Accounting Service ...................................................................... 9
5.0 SFIS RESOURCES ........................................................................................................... 9
Table 4-1. SFIS Compliance Summary ............................................................................... 10
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CHAPTER 4
STANDARD FINANCIAL INFORMATION STRUCTURE
1.0 GENERAL
1.1 Overview
The Standard Financial Information Structure (SFIS) is a comprehensive data structure
that supports requirements for budgeting, financial accounting, cost/performance, interoperability,
and external reporting needs across the Department of Defense (DoD) enterprise. It is a common
business language that enables budgeting, performance-based management, and the generation of
financial statements. SFIS standardizes financial reporting across DoD and allows revenues and
expenses to be reported by programs that align with major goals, rather than basing reporting
primarily on appropriation categories. It also enables decision-makers to efficiently compare
programs and their associated activities and costs across DoD and provides a basis for common
valuation of DoD programs, assets, and liabilities. The SFIS matrix that defines each data element
is available on the SFIS resources web page.
1.2 Purpose
This chapter prescribes the requirements for SFIS and Standard Line of Accounting
(SLOA)/Accounting Classification compliance for DoD business systems. SFIS and
SLOA/Accounting Classification compliance provides a means for DoD business systems to meet
statutory requirements and additional requirements implemented by the Office of Management
and Budget (OMB), and the United States Department of the Treasury (Treasury).
1.3 Authoritative Guidance
1.3.1. Title 10, United States Code (U.S.C.), section 2222(e)(3) (10 U.S.C. § 2222(e)(3)),
Defense business systems: business process reengineering; enterprise architecture; management,
requires the DoD Business Enterprise Architecture (BEA) include an information infrastructure
that, at a minimum, enables DoD to:
1.3.1.1. Comply with all applicable law, including Federal accounting, financial
management, and reporting requirements;
1.3.1.2. Routinely produce verifiable, timely, accurate, and reliable business and
financial information for management purposes;
1.3.1.3. Integrate budget, accounting, and program information and systems; and
1.3.1.4. Identify whether each existing business system is a part of the business
system environment outlined by the Defense BEA, will become a part of that environment with
appropriate modification, or is not a part of that environment.
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1.3.2. 10 U.S.C. § 2222(e)(3)(A) requires establishment of policies, procedures, business
data standards, business performance measures, and business system interface requirements that
are applied uniformly throughout DoD.
1.3.3. 31 U.S.C. § 902(a)(3), Authority and functions of agency Chief Financial Officer,
requires agencies to develop and maintain an integrated agency accounting and financial
management system, including financial reporting and internal controls that:
1.3.3.1. Complies with applicable accounting principles standards and
requirements, and internal control standards;
1.3.3.2. Complies with such policies and requirements as may be prescribed by the
Director of OMB;
1.3.3.3. Complies with any other requirements applicable to such systems; and
1.3.3.4. Provides for:
1.3.3.4.1. Complete, reliable, consistent, and timely information which is
prepared on a uniform basis and which is responsive to the financial information needs of agency
management;
1.3.3.4.2. The development and reporting of cost information;
1.3.3.4.3. The integration of accounting and budgeting information; and
1.3.3.4.4. The systematic measurement of performance.
1.3.4. The Federal Financial Management Improvement Act of 1996 (FFMIA) requires
agencies to incorporate accounting standards and reporting objectives established for the Federal
Government into financial management systems so that all the assets and liabilities, revenues,
expenditures or expenses, and the full costs of programs and activities of the Federal Government
are consistently and accurately recorded, monitored, and uniformly reported throughout the
Federal Government.
1.3.5. The Government Performance and Results Act of 1993 (GPRA), as amended by
the GPRA Modernization Act of 2010, requires annual performance reporting that links
performance planned to performance achieved.
1.3.6. The OMB Circular A-123, Appendix D, provides FFMIA compliance guidance
including the requirement for agencies’ financial management systems to reflect an agency-wide
financial information classification structure that is consistent with the United States Standard
General Ledger (USSGL). Application of the USSGL at the transaction level means that each
time an approved transaction is recorded in a financial management system, it must generate the
appropriate general ledger accounts for posting the transaction according to the rules defined in
the USSGL guidance. OMB Circular 123, Appendix D was incorporated into Chapter 3.
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1.3.7. The OMB, Office of Federal Financial Management requires, within each
department or agency, standard accounting classification elements and definitions to ensure
uniform and efficient accounting treatment, classification, and reporting.
1.3.8. The Treasury Bureau of the Fiscal Service publishes the USSGL which is updated
annually in the Treasury Financial Manual (TFM). The TFM Volume 1, Supplements includes
the latest USSGL Bulletin and seven major sections that comprise the Treasury USSGL guidance:
(I) Chart of Accounts, (II) Accounts and Definitions, (III) Account Transactions, (IV) Account
Attributes for USSGL Proprietary Account and Budgetary Account Reporting, (V) Crosswalks to
Standard External Reports for Governmentwide Treasury Account Symbol Adjusted Trial Balance
System (GTAS) Reporting, (VI) Crosswalks to Reclassified Statements for Reporting, and (VII)
GTAS Validations and Edits for Reporting. The USSGL standardizes federal agency accounting
and supports the preparation of standard external reports required by the OMB and Treasury.
2.0 DEFINITIONS
2.1 Business Enterprise Architecture
The BEA is the enterprise architecture for the DoD business mission area that guides and
constrains implementation of interoperable Defense business system solutions as required by
10 U.S.C. § 2222. The BEA defines the DoD business transformation priorities, the business
capabilities required to support those priorities, and the combinations of enterprise systems and
initiatives that enable those capabilities. It is used to determine compliance for systems reviewed
by the Defense Business Council (DBC) and includes the SFIS requirements. The BEA
structure/framework was developed using a set of integrated DoD Architecture Framework
products to include the All View, Operational View, Systems and Services View, and Technical
Standards View. It includes activities, processes, data, information exchanges, business rules,
system functions, system data exchanges, terms, and linkages to laws, regulations, and policies.
2.2 Financial Management System Types
This paragraph defines DoD financial management system types in the current
environment for purposes of SFIS and SLOA/Accounting Classification compliance. See the
Glossary for a complete definition of a financial management system and Chapter 3 for definitions
of a financial system and a mixed system.
2.2.1. Target Accounting System. A target accounting system is configured to post
transactions to an internal USSGL compliant subsidiary or general ledger and does not have a
system retirement plan and date.
2.2.2. Target Financial Business Feeder System. A target financial business feeder system
creates or processes transactions with financial impacts and exchanges accounting data with
another business feeder system(s) and/or accounting system(s). This type of system does not
qualify as a target accounting system and does not have a retirement plan and date.
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2.2.3. Legacy Accounting System. Same definition as paragraph 2.2.1 except it has a
retirement plan and date.
2.2.4. Legacy Financial Business Feeder System. Same definition as paragraph 2.2.2
except it has a retirement plan and date.
2.3 Investment Review Process
DoD implemented a business systems investment review process through the DBC. The
DBC is the principal subsidiary governance body to the Deputy's Management Action Group
(DMAG) for defense business operations. The DBC also assumes the role of the Department's
Investment Review Board (IRB) for Defense Business Systems investments. A primary goal of
the IRB process is to facilitate development and implementation of integrated business systems
across DoD business functions and capabilities; thereby providing a framework for effective
investment decision-making and enabling the Department’s senior leadership to guide investments
to maximize the impact to the warfighter. SFIS/SLOA is a critical part of this process.
2.4 SFIS Business Rules
The SFIS business rules specify how SFIS data elements must be implemented and are the
primary mechanism that drives SFIS compliance. The SFIS business rules dictate compliance
requirements such as syntax, storage, derivation and usage.
2.5 SFIS Compliance Checklist
The SFIS Compliance Checklist is based on the SFIS business rules. DoD Components
use the Checklist to document financial system compliance with the SFIS business rules. The
Checklist provides the Office of the Secretary of Defense leadership, DoD Component program
managers, and other financial and operations managers with a means for determining whether their
accounting and financial business feeder systems comply with SFIS requirements.
2.6 SFIS Values Library Service
The SFIS Values Library Service houses allowable SFIS values for specific SFIS data
elements. Systems must be compliant with the value lists as outlined in the data elements
authoritative source. The SFIS Values Library Service is located on the OUSD(C)/Chief Financial
Officer SFIS webpage.
2.7 Standard Data
Standard data relates to information that is transmitted, processed, maintained, and/or
accessed in a standard format. It is a structured communication medium that is exchanged within
and between entities and other groups for business transactions. The standards describe structures
that emulate documents; e.g., purchase orders to automate purchasing. The standard data is also
used to refer to the implementation and operation of systems and processes for creating,
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transmitting, and receiving information. It simplifies the aggregation of data, limiting crosswalks
and mapping procedures.
2.8 SLOA/Accounting Classification
The DoD SLOA/Accounting Classification is a subset of the SFIS data standard elements.
The SLOA/Accounting Classification is comprised of the minimum SFIS data elements that must
be exchanged for business events that have an accounting impact at any point from the initial
commitment to the final posting in the appropriate general ledger. This includes commitments,
obligations, expenditures, and disbursements. The SLOA accommodates Treasury reporting
requirements for daily cash reporting.
3.0 COMPLIANCE REQUIREMENTS
3.1 SFIS
3.1.1. SFIS compliance is required for all target accounting systems and target financial
business feeder systems that comprise the target environment, as identified in the Component’s
Functional Strategy and Organization Execution Plan that support financial transactions. SFIS is
also considered for legacy accounting systems and legacy financial business feeder systems on a
case-by-case basis. SFIS provides an enterprise-wide standard for categorizing financial
information along several dimensions to support financial management and financial reporting
functions; enable decision-makers to efficiently compare similar programs and activities across
DoD; and provide a level of detail required for information retrieval and auditability. SFIS is
aligned to federal-wide standards, at summary levels, for federal-level financial statements.
3.1.2. Systems must meet all applicable SFIS Business Rules. SFIS data element
transactions are required to be posted to the financial accounting system using the required USSGL
accounts and accounting standards. DoD Component program managers are required to use the
SFIS checklist to determine SFIS compliance and to guide implementation and configuration
efforts.
3.2 SLOA/Accounting Classification
3.2.1. The DoD SLOA/Accounting Classification is a subset of SFIS data elements that is
used to ensure accurate accounting transactions and interoperability between systems. The
SLOA/Accounting Classification requirement is applicable for all systems that process business
events with accounting impacts between the time of commitment through disbursement. This
includes, but is not limited to, accounting, contract writing, logistics, civilian pay, military pay,
travel, medical, and transportation. Target systems must send, receive, capture, store, and maintain
the SLOA/Accounting Classification data constructed as discrete data. Further, systems must meet
all applicable SFIS Business Rules.
3.2.2. For legacy accounting systems and legacy financial business feeder systems that
have a retirement plan and date, the implementation of SFIS and SLOA/Accounting Classification
is considered on a case-by-case basis depending upon its impact on audit readiness.
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3.3 Interoperability of Data between Systems
Systems that support the financial management purchasing process such as contracts,
intergovernmental orders, and payroll for audit readiness purposes must be interoperable with
SLOA/Accounting Classification data elements. Supporting transactions are required to be posted
to the target accounting system using proper USSGL accounts and accounting standards. A
transaction broker and translation service may be used for legacy systems with a retirement plan
and date to translate non-SFIS data elements to SFIS data elements.
3.4 Defense Departmental Reporting System SFIS Trial Balance
Target accounting systems must interface with the Defense Departmental Reporting
System using an SFIS Compliant Trial Balance. The SFIS Compliant Trial Balance must meet all
necessary USSGL and DoD financial reporting requirements.
4.0 ROLES AND RESPONSIBILITIES
4.1 Office of the Under Secretary of Defense (Comptroller)
The Office of the Under Secretary of Defense (Comptroller) (OUSD(C)):
4.1.1. Serves in a leadership role and establishes policy for the development of DoD
enterprise business and financial systems to include SFIS implementation across DoD.
4.1.2. Is responsible for providing stewardship for SFIS financial data elements, and serves
as a primary representative on the DMAG and DBC (reference paragraph 2.3).
4.1.3. Provides business and financial system insight on all issues presented at
committee/board meetings and serves as the primary office of responsibility for actions stemming
from the DMAG and the IRB.
4.1.4. Is responsible for publishing and maintaining the SFIS resources repository.
4.1.5. Works with DoD Components and Enterprise Resource Planning (ERP) integration
teams to properly implement SFIS.
4.2 Office of the Chief Information Officer
The Office of the Chief Information Officer leads the extraction and analysis of data to
support business reform as well as lead the operation of a DoD-wide data governance body to
oversee the preparation, extraction, and provision of common, transparent enterprise data
throughout the business enterprise, including coordination on all data standards, to include SFIS,
cost management, and overall data management.
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4.3 DoD Components
DoD Components are responsible for:
4.3.1. Implementing SFIS for all applicable systems and ensuring interoperability between
systems that have a financial impact. This includes asserting compliance with SFIS by using the
Compliance Checklist for SFIS and maintaining their systems consistent with SFIS requirements.
4.3.2. Ensuring that all financial management systems (as defined in the Glossary) provide
complete, reliable, consistent and timely budgetary and proprietary transaction-level information
in accordance with SFIS; and are recorded in general ledgers of the accounting systems of record
to produce auditable budgetary, proprietary, and managerial cost accounting reports for use by
external and internal stakeholders.
4.4 Defense Finance and Accounting Service
The Defense Finance and Accounting Service is responsible for maintaining the SFIS
values library and ensuring all service provider applications and enterprise systems are compliant
with SFIS.
5.0 SFIS RESOURCES
The SFIS web page contains several resources that define the SFIS requirements and
provides tools to assist with compliance including the following:
5.0.1. SFIS Matrix (SFIS data elements, definitions, examples, business rules, syntaxes,
primary stewards, authoritative sources, required reports, and Extensible Markup Language
Schemas).
5.0.2. SFIS Compliance Checklist.
5.0.3. SFIS/Standard Line of Account/Accounting Classification.
5.0.4. SFIS Values Library Service.
5.0.5. SFIS Enterprise Resource Planning Standard Configurations.
5.0.6. DoD Accounting Scenarios.
5.0.7. DoD USSGL Transaction Library.
5.0.8. DoD Standard Chart of Accounts Implementation Guidance.
5.0.9. DoD Chart of Accounts Tie-Points Standard.
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5.0.10. Defense Departmental Reporting System Chart of Account Guidance and Account
Attribute Alignment Guidance
5.0.11. Archived DoD Chart of Account Guidance.
5.0.12. Authoritative Guidance Pertaining to SFIS (External Links).
Table 4-1. SFIS Compliance Summary
Financial Management System Type
SFIS Compliance Requirement
Target Accounting System
SFIS
DoD SLOA/Accounting Classification
DoD USSGL Transaction Library
DoD Standard Chart of Accounts
Target Financial Business Feeder System
(processes business events with accounting
impacts
between the time of commitment
through disbursement)
SFIS
DoD SLOA/Accounting Classification
Legacy Accounting System
SFIS and DoD SLOA/Accounting
Classification are considered on a case-by-case
basis
Legacy Financial Business Feeder System
(creates o
r processes transactions with
financial impacts and exchanges accounting
data with other business feeder systems or
accounting systems)
SFIS and DoD SLOA/Accounting
Classification are considered on a case-by-case
basis
DoD 7000.14 - R
DEPARTMENT OF DEFENSE
FINANCIAL MANAGEMENT REGULATION
CHAPTER 5: "ARCHIVED"
UNDER SECRETARY OF DEFENSE
(COMPTROLLER)
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VOLUME 1, CHAPTER 6: “UNDER SECRETARY OF DEFENSE (COMPTROLLER)
FINANCIAL MANAGEMENT AWARDS PROGRAM”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated December 2022 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Administrative updates in accordance with the Department of
Defense Financial Management Regulation Revision Standard
Operating Procedures.
Revision
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Table of Contents
VOLUME 1, CHAPTER 6: “UNDER SECRETARY OF DEFENSE (COMPTROLLER)
FINANCIAL MANAGEMENT AWARDS PROGRAM” ............................................................ 1
1.0 GENERAL......................................................................................................................... 3
1.1 Overview ........................................................................................................................ 3
1.2 Purpose ........................................................................................................................... 3
1.3 Authoritative Guidance .................................................................................................. 3
2.0 POLICY ............................................................................................................................. 3
2.1. Military and Civilian Members ...................................................................................... 3
2.2. Awards ........................................................................................................................... 4
2.3. USD(C) Salute to Excellence in Government Service ................................................... 5
2.4. Program Applicability .................................................................................................... 5
2.5. Nomination Categories ................................................................................................... 5
3.0 AWARD LEVELS, TYPES, AND CATEGORIES ......................................................... 6
3.1. Award Levels ................................................................................................................. 6
Table 6-1. Award Level Matrix .............................................................................................. 6
3.2. Award Types .................................................................................................................. 7
3.3. Award Categories ........................................................................................................... 7
4.0 RESPONSIBILITIES ...................................................................................................... 10
4.1 The USD(C): ................................................................................................................ 10
4.2 The OUSD(C) Human Capital Resource Management Director (HCRM): ................ 10
4.3 Heads of the Military Departments and DFAS ............................................................ 10
4.4 DoD Component Heads ............................................................................................... 10
4.5 The Financial Management Awards Program Board ................................................... 11
4.6 Final Reviewers ............................................................................................................ 11
4.7 The Nominating Official: ............................................................................................. 11
4.8 The Supervisor: ............................................................................................................ 11
4.9 The Submitter: .............................................................................................................. 12
5.0 AWARD CRITERIA AND NOMINATION INFORMATION ..................................... 12
5.1 Award Criteria .............................................................................................................. 12
5.2 Nomination Information ............................................................................................... 12
5.3 Submission of Nominations ......................................................................................... 13
5.4 Nomination Responsibilities ........................................................................................ 13
5.5 Individual and Team Awards ....................................................................................... 14
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CHAPTER 6
UNDER SECRETARY OF DEFENSE (COMPTROLLER) FINANCIAL
MANAGEMENT AWARDS PROGRAM
1.0 GENERAL
1.1 Overview
The Under Secretary of Defense (Comptroller) (USD(C)) Financial Management Awards
Program is a respected program that recognizes and acknowledges the significant contributions of
both civilian and military members of the financial management (FM) community. This chapter
outlines award categories and descriptions, award criteria, and individual responsibilities
associated with the program.
1.2 Purpose
The purpose of the USD(C) Financial Management Awards Program is to recognize
significant contributions of individuals or teams to financial management improvement.
1.3 Authoritative Guidance
1.3.1. The Government Employees Incentive Awards Act at Title 5, United States Code,
section 4503 5 U.S.C. § 4503 authorizes agency heads to award an honorary recognition to an
employee who contributes to the efficiency, economy, or other improvement of government
operations or achieves a significant reduction in paperwork or performs a special act or service in
the public interest in connection with or related to his official employment. 10 U.S.C. § 1125
authorizes the Secretary of Defense to award medals, trophies, badges, and similar devices to
members, units, or agencies of an armed force under his jurisdiction for excellence in
accomplishments.
1.3.2. 10 U.S.C. § 240b (Statutory Notes and Related Subsidiaries) provides that “the
Under Secretary of Defense (Comptroller), acting through the Deputy Chief Financial Officer of
the Department of Defense, will develop and issue guidance to provide incentives for the
achievement by each department, agency, and other Component of the Department of Defense of
unqualified audit opinions on their financial statements”.
2.0 POLICY
2.1. Military and Civilian Members
Military and civilian members who make outstanding contributions to the improvement of
DoD FM may be recognized.
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2.2. Awards
Recognition for their significant contribution(s) during the preceding calendar year, in the
form of a memento such as an engraved plaque, will be presented to, and retained by, the individual
and team within each award category. Awards are conferred in the following categories:
2.2.1. Contributions to Workforce Development:
2.2.1.1. Individual at Headquarters and Major Command Level
2.2.1.2. Individual below Headquarters and Major Command Level
2.2.1.3. Team at Headquarters and Major Command Level
2.2.1.4. Team below Headquarters and Major Command Level
2.2.2. Contributions to Taxpayer Dollar Optimization:
2.2.2.1. Individual at Headquarters and Major Command Level
2.2.2.2. Individual below Headquarters and Major Command Level
2.2.2.3. Team at Headquarters and Major Command Level
2.2.2.4. Team below Headquarters and Major Command Level
2.2.3. Contributions to Financial Integrity and Audit Results:
2.2.3.1. Individual at Headquarters and Major Command Level
2.2.3.2. Individual below Headquarters and Major Command Level
2.2.3.3. Team at Headquarters and Major Command Level
2.2.3.4. Team below Headquarters and Major Command Level
2.2.4. Contributions to End-to-End Business Environment Optimization:
2.2.4.1. Individual at Headquarters and Major Command Level
2.2.4.2. Individual below Headquarters and Major Command Level
2.2.4.3. Team at Headquarters and Major Command Level
2.2.4.4. Team below Headquarters and Major Command Level
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2.2.5. Contributions to Data-Driven Decision-Making:
2.2.5.1. Individual at Headquarters and Major Command Level
2.2.5.2. Individual below Headquarters and Major Command Level
2.2.5.3. Team at Headquarters and Major Command Level
2.2.5.4. Team below Headquarters and Major Command Level
2.2.6. Contributions to Financial Management in a Contingency Operation:
2.2.6.1. Individual at any level
2.2.6.2. Team at any level
2.3. USD(C) Salute to Excellence in Government Service
These awards specifically allow the USD(C) to recognize an individual or team whose
efforts throughout the past calendar year have made exceptional contributions in Savings and
Innovation. The Board members will recommend to USD(C) for selection winners of these awards
from among the nominations submitted in the categories in subparagraphs 2.2.1 through 2.2.6.
2.3.1. USD(C) Salute to Excellence in Government Service – Exceptional Savings.
This category recognizes either an individual or team whose actions have resulted in a significant
savings to the taxpayer.
2.3.2. USD(C) Salute to Excellence in Government Service – Exceptional
Innovation. This category recognizes either an individual or team whose actions have resulted in
significant innovations in Financial Management.
2.4. Program Applicability
The Program applies to the Office of the Secretary of Defense, the Military Departments,
the Chairman of the Joint Chiefs of Staff, the Combatant Commands, the Office of the Inspector
General of the Department of Defense, the Defense Agencies, and the DoD Field Activities, and
all other organizational entities within the DoD (hereafter referred to collectively as “the DoD
Components”). The individual or team’s accomplishment must have occurred within the
preceding calendar year.
2.5. Nomination Categories
Any military member or DoD civilian employee (to include Reserve Components) is
eligible for nomination. General/Flag Officers, Senior Executive Service, and contractors cannot
be nominated for individual awards, but can be named and recognized as members of team awards.
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3.0 AWARD LEVELS, TYPES, AND CATEGORIES
3.1. Award Levels
The two award levels in the USD(C) Financial Management Awards Program are:
3.1.1. Headquarters level and Major Command level.
3.1.1.1. Headquarters level is defined as the headquarters of a Military
Service Department, Defense Agency, or Field Activity.
3.1.1.2. Major Command Level is defined as the highest level of command
below headquarters level within the Military Department. For the Defense Agencies and Field
Activities, Major Command level is based on the organization’s structure, not the nature of the
work covered by the award. Major Command level refers to the next level of subordinate
organizations to the Headquarters location. Table 6-1 provides examples.
3.1.2. Below Major Command level includes any organization not meeting the
requirements to be considered Headquarters and Major Command level. For Defense Agencies
and Field Activities, this includes regional offices or other organizations subordinate to the
Headquarters or Major Command level. Table 6-1 provides examples.
Table 6-1. Award Level Matrix
Organizational Level
Performing the Work
Award Level
Headquarters
Headquarters and Major Command
Military Department Major Command
Headquarters and Major Command
Combatant Command Headquarters
Headquarters and Major Command
Brigade/Afloat Command/Group
Below Major Command
Regional Office
Below Major Command
Examples
blank
DFAS Headquarters
Headquarters and Major Command
DFAS Major Center (Cleveland, Columbus,
Indianapolis)
Headquarters and Major Command
DFAS Other (Rome, Limestone, Japan, Europe,
Non-Appropriated Funds, to include Support
Offices)
Below Major Command
DCAA (HQ, Regional and Corporate Offices)
Headquarters and Major Command
DCAA (Field Offices and Sub Offices)
Below Major Command
DLA (Headquarters)
Headquarters and Major Command
DLA (Major Subordinate Command and
Below)
Below Major Command
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3.2. Award Types
The two award types in the USD(C) Financial Management Awards Program are:
3.2.1. Individual awards: Given to one person at the Headquarters and Major
Command level and Below Major Command level as listed in subparagraphs 2.2.1 through 2.2.6.
3.2.2. Team awards: Given to one team at the Headquarters and Major Command
level and the Below Major Command level as listed in subparagraphs 2.2.1 through 2.2.6. Teams
are made up of 2 to 20 individuals brought together to perform a specific task within a specific
time frame. Teams of greater than 20 individuals are not eligible for these awards. The team lead
must be one of the 20 members of the team. Contractors cannot comprise more than 20 percent of
the team. Contractors cannot use these awards as support for performance clauses in contracts.
3.3. Award Categories
The award categories in the USD(C) Financial Management Awards Program are:
3.3.1. Contributions to Workforce Development. This category recognizes one
individual and one team, at each of the two award levels, who have made significant contributions
to building and maintaining a premier FM workforce; optimizing and evolving FM training
solutions: or fostering an FM community of practice. Improvements may be in areas such as
workforce development, innovative practices in recruiting and retention, and training and
information sharing. Examples of appropriate efforts include:
3.3.1.1. Establishing an innovative training program to improve workforce
proficiency in a key area of critical competencies.
3.3.1.2. Establishing a program to improve recruiting, employee
engagement, satisfaction, and retention.
3.3.1.3. Establishing forums to implement best practices and
accomplishments.
3.3.1.4. Instituting a mentorship or partnership program to help guide the
future development of workforce members.
3.3.2. Contributions to Taxpayer Dollar Optimization. This category recognizes
one individual and one team, at each of the two award levels, who have made significant
contributions to optimizing support to the budget and execution process; innovating cost,
performance, and risk management; or fostering a high integrity funds control environment.
Improvements may be in areas such as budget formulation, budget execution, cost management,
or accountable financial stewardship. Examples of appropriate efforts include:
3.3.2.1. Refining the budget to execution process to optimize mission
capability with agility.
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3.3.2.2. Creating efficiencies through new guidance and/or reducing
outdated regulations, processes, and policies.
3.3.2.3. Delivering innovative financial cost, performance, and enterprise
risk management insights to improve resource budgeting and forecasting activity.
3.3.2.4. Improving fiscal control over assets, dissemination of funds,
budget execution tracking, and funds realignment through innovative solutions.
3.3.3. Contributions to Financial Integrity and Audit Results. This category
recognizes one individual and one team, at each of the two award levels, who have made significant
contributions toward remediating material weaknesses aligned with the Department’s audit
priorities to accelerate its path to an unmodified audit opinion. Improvements may be in areas
such as increasing the number of favorable (unmodified or qualified) financial statement or
Statement on Standards for Attestation Engagements No. 18 audit opinions, implementing end-to-
end business process reengineering efforts leading to improved auditability for a priority area,
innovating processes and improving controls to reduce undistributed disbursements and or
collections in a timely manner, and developing innovations to achieve unmodified audit opinions.
When considering this category, reference 10 U.S.C. § 240b “Incentives for the Achievement by
the Components of the Department of Defense of Unqualified Audit Opinions on the Financial
Statements.” Examples of appropriate efforts include:
3.3.3.1. Developing innovations to support achieving unmodified audit
opinions.
3.3.3.2. Closing a notice of finding and recommendation related to a
priority area.
3.3.3.3. Closing or downgrading a material weakness related to a priority
area.
3.3.3.4. Implementing effective improvements to controls over financial
reporting for a priority area.
3.3.4. Contributions to End-to-End Business Environment Optimization. This
category recognizes one individual and one team, at each of the two award levels, who have made
significant contributions to automating FM operations and the identification of business processes
that will form tomorrow’s environment. Improvements may be in areas such as system security,
leveraging innovative digital and automation solutions, or simplifying FM regulation and policy.
Examples of appropriate efforts include:
3.3.4.1. Retiring legacy systems and accelerating optimization of modern
enterprise solutions.
3.3.4.2. Increasing automation of repeatable processes and interfaces
between enduring systems.
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3.3.4.3. Simplifying regulations or policies that address barriers to fully
enable standardization.
3.3.5. Contributions to Data-Driven Decision-Making. This category recognizes
one individual and one team, at each of the two award levels, who have made significant
contributions to innovating and empowering data-driven, fiscally informed decision-making;
driving universal use of secure, single-source reporting; or instilling confidence in FM data for
decision-making. Improvements may be in areas such as improving financial data management
standards, increasing data analytics capabilities, and enhancing the usage of real-time data to
support decision-making through innovative practices. Examples of appropriate efforts include:
3.3.5.1. Improving the quality of data and universal data management and
modeling standards.
3.3.5.2. Developing innovative methods to increase access to real-time
data.
3.3.5.3. Supporting a Universe of Transaction balance as a percentage of
financial statement balances.
3.3.6. Contributions to Financial Management in a Contingency Operation. This
category recognizes one individual and one team, at any level, who have made significant
contributions to modernize and improve financial management while in support of a contingency
operation. Improvements can be in auditing, accounting, budget, cost analysis, workforce
development, and other Financial Management fields. Examples of appropriate efforts include:
3.3.6.1. Implementing controls that improve auditability of funds managed
in the contingency operation.
3.3.6.2. Changing and/or reengineering a process or steps of a process to
make the process better, faster, and/or less expensive by using technology as an enabler in a
contingency operation.
3.3.6.3. Identifying, proposing, and implementing an improvement to a
problem, project, or effort using analysis to better utilize resources and improve mission
effectiveness in a contingency operation.
3.3.7. USD(C) Salute to Excellence in Government Service. These awards
specifically allow the USD(C) to recognize an individual or team whose efforts throughout the
past calendar year have made exceptional contributions in Savings and Innovation. The Board
members will recommend to USD(C) for selection winners of these awards from among the
nominations submitted in the categories in paragraphs 2.3.
3.3.7.1. USD(C) Salute to Excellence in Government Service - Exceptional
Savings. This category recognizes either an individual or team whose actions have resulted in a
significant savings to the taxpayer.
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3.3.7.2. USD(C) Salute to Excellence in Government Service - Exceptional
Innovation. This category recognizes either an individual or team whose actions have resulted in
significant innovations in Financial Management.
4.0 RESPONSIBILITIES
4.1 The USD(C):
4.1.1. Will select awards recipients for each category, type, and level.
4.1.2. May select one or more recipients for the USD(C) Salute to Savings Award from
among the pool of nominations submitted in the other six categories.
4.1.3. Will present awards to each recipient.
4.1.4. Will release an annual memorandum announcing any changes to this regulation, call
for the submission of nominations for this awards program, and delineate the nomination and
review timeline.
4.2 The OUSD(C) Human Capital Resource Management Director (HCRM):
4.2.1. Will annually convene a Financial Management Awards Program Board to review
nominations from the DoD Components.
4.2.2. Will make award recommendations to the USD(C).
4.2.3. Will appoint a representative from among the Defense Agencies and DoD Field
Activities (other than the Defense Finance and Accounting Service (DFAS)) to the FM Awards
Program Board.
4.2.4. Will ensure OUSD(C) Financial Improvement and Audit Remediation Director
(FIAR) is represented on the FM Awards Program Board.
4.3 Heads of the Military Departments and DFAS
Will each select a representative to the Financial Management Awards Program Board and
notify the Director, HCRM in accordance with the annual USD(C) memorandum, of the
representative selected from their Component.
4.4 DoD Component Heads
4.4.1. Will encourage the nomination of individuals and teams for the Financial
Management Awards in accordance with the procedures and criteria in Section 5.0.
4.4.2. Will appoint a Final Reviewer by email for all nominations submitted by members
of their Component in accordance with the annual call memorandum.
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4.5 The Financial Management Awards Program Board
4.5.1. Is chaired by the OUSD(C) HCRM Director, or designee.
4.5.2. Is comprised of one voting representative from each of the Military Departments,
DFAS, one from the Defense-wide community, which encompasses all other Defense Agencies
and DoD Field Activities, and the OUSD(C) FIAR Director. Members will not delegate
attendance of the Board Member meeting. Members will not serve more than two consecutive
terms with exception of the OUSD(C) FIAR Director.
4.5.3. Is comprised of members of the Senior Executive Service, general/flag officers,
and/or E-9s.
4.5.4. Members must not be the Nominating Officials for any of the award nominations
submitted.
4.5.5. Is convened annually to evaluate nominations and make recommendations for
winners in each award category based on the criteria in paragraph 5.1.
4.6 Final Reviewers
4.6.1. Are responsible for vetting the nominations prior to submission to the Board.
Nominations must be examined for duplications, incomplete submissions, and noncompliance
with instructions.
4.6.2. May not be a Nominating Official.
4.6.3. Are responsible for approving or denying each nomination submitted for their
Component before all nominations are due to OUSD(C). Only approved nominations will go
before the Board.
4.7 The Nominating Official:
4.7.1. Will review each one of their nominations ensuring nominee names and contact
information are correct and accurate.
4.7.2. Will certify, by electronic signature, that each submission complies with the
nomination submission instructions outlined on FM Online.
4.8 The Supervisor:
4.8.1. Will consider members of their workforce whose achievements merit recognition in
the USD(C) FM Awards Program.
4.8.2. Will serve as the Nominating Official for appropriate nominations.
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4.9 The Submitter:
4.9.1. Will input all data into the nomination template for the appropriate nomination in
accordance with the procedures and criteria in this chapter and on FM Online as directed by the
Nominating Official.
4.9.2. May be the same person as the Nominating Official.
5.0 AWARD CRITERIA AND NOMINATION INFORMATION
The award criteria and nomination information for the DoD Financial Management Awards
are as follows:
5.1 Award Criteria
Nominations for DoD Financial Management Awards must be based on individual or team
achievements during the preceding calendar year. Board Members will evaluate nominations,
assigning a numeric score, after considering the following criteria:
5.1.1. Scope and Significance, examples include:
5.1.1.1. DoD Enterprise / Warfighter / Mission Impact
5.1.1.2. Fiscal Stewardship (cost/manpower savings, cost avoidance)
5.1.1.3. Results were Actionable and Repeatable
5.1.1.4. FM Workforce Development and or Strategic Partnering Improvement
5.1.1.5. Focused on Outcomes – maximizing dollars spent and funding priorities
5.1.1.6. Embraced innovation by streamlining automation solutions
5.2 Nomination Information
For specifics on procedures for submitting nominations refer to FM Online. Information
included in the nominations is used for formal recognition.
5.2.1. Nominations should be written to a broad and diverse audience.
5.2.2. Nominations should be written in a concise manner that clearly describes the impact.
Limit use of acronyms or superlative wording.
5.2.3. DoD Components may not submit more than one nomination for the same
achievements. For example:
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5.2.3.1. A DoD Component may not submit a team nomination and an individual
nomination for the same achievements.
5.2.3.2. A DoD Component may not submit a nomination, either team or
individual, with the same achievements, for different award categories, types, or levels.
5.2.4. For Team awards, DoD Components may identify additional personnel from other
DoD Components who participated in the actions leading to the recognized achievements. The
addition of other DoD Components to an award does not affect the nomination restrictions set in
paragraph 5.3.
5.3 Submission of Nominations
5.3.1. Heads of DoD Components must submit nominations to the OUSD(C) HCRM
Director via the OUSD(C) awards nomination site.
5.3.2. OUSD(C) HCRM must receive nominations by the date designated in the
memorandum sent to the Components.
5.3.3. Final Reviewers must review nominations by the date designated in the
memorandum sent to the Components. OUSD(C) HCRM will not accept nomination edits after
the end of the review period.
5.3.4. Heads of DoD Components are restricted in the number of nominations they can
submit for consideration in each Category, Type, and Level:
5.3.4.1. DoD Components with an FM workforce of at least 1,000 personnel can
submit up to two nominations per Category, Type, and Level; allowing a maximum of
44 nominations.
5.3.4.2. DoD Components with an FM workforce of fewer than 1,000 personnel
can submit up to one nomination per Category, Type, and Level; allowing a maximum of
22 nominations.
5.3.4.3. Combatant Command Support Agents may submit one nomination per
Category, Type, and Level for personnel serving in the Headquarters of a Unified Combatant
Command. These nominations will compete as Combatant Command nominations.
5.3.5. Components may not submit nominations for the USD(C) Salute to Savings award
category. The USD(C) will select winners for this category from among the pool of nominations
submitted in the other six award categories.
5.4 Nomination Responsibilities
Responsibility for individual and team award nominations is vested with the DoD
Component owning the position of the person being nominated.
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5.5 Individual and Team Awards
Each individual award recipient will receive a memento such as an engraved plaque. Each
team will receive a single memento such as an engraved plaque, while team members will each
receive a memento such as a certificate.
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VOLUME 1, CHAPTER 7: “DEPARTMENT OF DEFENSE STANDARD CHART OF
ACCOUNTS”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated October 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
4.4.3
Combined with paragraph 4.4.2.
Deletion
All
Administrative updates in accordance with Department of
Defense Financial Management Regulation (FMR) Revision
Standard Operating Procedures.
Revision
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 7
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Table of Contents
VOLUME 1, CHAPTER 7: “DEPARTMENT OF DEFENSE STANDARD CHART OF
ACCOUNTS” ................................................................................................................................. 1
1.0 GENERAL ........................................................................................................................ 3
1.1 Purpose ........................................................................................................................... 3
1.2 Authoritative Guidance .................................................................................................. 3
2.0 DEFINITIONS .................................................................................................................. 4
2.1 Standard Financial Information Structure ...................................................................... 4
2.2 DoD Standard Chart of Accounts SFIS Attribute Alignment File ................................. 4
2.3 Tie-Point Reconciliations ............................................................................................... 4
2.4 Financial System ............................................................................................................ 4
3.0 ACCOUNT DESIGN ........................................................................................................ 4
3.1 DoD SCOA .................................................................................................................... 4
3.2 Account Structure ........................................................................................................... 5
3.3 DoD USSGL Transaction Library.................................................................................. 5
3.4 Reporting ........................................................................................................................ 6
4.0 ACCOUNT RELATIONSHIPS ........................................................................................ 6
4.1 Budgetary and Proprietary Accounts ............................................................................. 6
4.2 Accounts Applicable to Fund Type ................................................................................ 6
4.3 Account Attributes ......................................................................................................... 7
4.4 Request for Account Exemption .................................................................................... 7
4.5 DoD Assigned USSGL Accounts .................................................................................. 8
Figure 7-1. DoD Assigned Accounts for Internal Fund Distributions ................................... 8
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CHAPTER 7
DEPARTMENT OF DEFENSE STANDARD CHART OF ACCOUNTS
1.0 GENERAL
1.1 Purpose
This chapter prescribes the Department of Defense (DoD) Standard Chart of Accounts
(SCOA) requirements that are based on United States Standard General Ledger (USSGL) general
requirements. The SCOA prescribes the mandatory general ledger accounts for all DoD
accounting systems and all budgetary and proprietary transactions.
1.2 Authoritative Guidance
1.2.1. The Federal Financial Management Improvement Act of 1996 (FFMIA) requires
agencies to implement and maintain financial management systems that comply with the USSGL
at the transaction-level. See Chapter 3 for FFMIA compliance information.
1.2.2. The United States Department of the Treasury (Treasury) Financial Manual (TFM)
prescribes the USSGL requirements. The USSGL is a TFM Supplement that prescribes the
structure for budgetary and proprietary accounts at the 6-digit USSGL account level. Because
central agency reporting requires a lower level of detail, the USSGL Board developed attributes
containing domain values that, when added to a basic 6-digit USSGL account, provide the
appropriate level of detail needed for central agency reporting. Treasury issues bulletins at least
annually notifying agencies of changes to the USSGL Supplements that are effective immediately
and later codified in the TFM. As part of the overall Governmentwide Treasury Account Symbol
Adjusted Trial Balance System (GTAS) reporting requirements, the USSGL guidance contains
seven major sections:
I. Chart of Accounts,
II. Accounts and Definitions,
III. Account Transactions,
IV. Account Attributes for USSGL Proprietary Account and Budgetary Account
Reporting,
V. Crosswalks to Standard External Reports for FY 20XX
1
GTAS Reporting,
VI. Crosswalks to Reclassified Statements for FY 20XX Reporting, and
VII. GTAS Validations and Edits for FY 20XX Reporting.
1.2.3. Office of Management and Budget (OMB) Circular A-123 Appendix D,
“Compliance with the Federal Financial Management Improvement Act,” requires that agencies
record financial events in the core accounting systems, applying the requirements of the USSGL.
1
“XX” represents the applicable fiscal year.
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2.0 DEFINITIONS
2.1 Standard Financial Information Structure
2.1.1. The Standard Financial Information Structure (SFIS) is a comprehensive data
structure that supports requirements for budgeting, financial accounting, cost/performance, and
external reporting needs. The SCOA is a key element in the SFIS data structure. The SCOA and
other SFIS products are published on the SFIS web page. Also, see Chapter 4.
2.2 DoD Standard Chart of Accounts SFIS Attribute Alignment File
The SFIS Attribute Alignment File (“FY20XX DoD SCOA Account Attribute Alignment
File”) identifies standard interface file format requirements for the Defense Departmental
Reporting System (DDRS), providing a means to determine which SFIS data element and value
combinations are necessary for consistent financial reporting. For each Standard General Ledger
(SGL) account, the Attribute Alignment File identifies additional SFIS data elements required for
financial reporting and which value combinations are permissible for SFIS attributes. The file and
corresponding instructions are available on the SFIS web page.
2.3 Tie-Point Reconciliations
Tie-Point Reconciliations, also referred to as “Tie-Points,” are a series of standard USSGL
accounting relationships, i.e., financial management equations that facilitates the validation of trial
balance data. The SCOA Tie-Points are revised annually and published on the SFIS web page.
Tie-Points indicate whether certain account balances within a general ledger trial balance are
consistent with other account balances. Components and accounting service providers must
combine budgetary and proprietary general ledgers to a self-balancing trial balance and conduct
edits and Tie-Point validations prior to reporting data in the DDRS. Components must
expeditiously resolve unreconciled Tie-Points in support of accurate and reliable agency-wide trial
balances to Treasury via GTAS for consolidation into the Governmentwide financial statements.
2.4 Financial System
A financial system is an information system or set of applications that maintains all
summary and detailed financial events resulting from budgetary and proprietary activity. The
system must record at the transaction-level to the appropriate general ledger accounts. See FFMIA
section 803(a) and OMB Circular A-123, Appendix D.
3.0 ACCOUNT DESIGN
3.1 DoD SCOA
The SCOA is comprised of budgetary and proprietary USSGL accounts and related DoD
standard account extensions required for consistent USSGL implementation, Component trial
balance consolidation, and compliance with OMB and Treasury budgetary and financial reporting
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requirements. The Office of the Under Secretary of Defense (Comptroller)/Chief Financial Officer
(OUSD(C)/CFO) issues enterprise-wide implementation guidance to:
3.1.1. Reduce customization of accounting systems,
3.1.2. Eliminate departmental reporting system translations and account value crosswalks,
3.1.3. Improve comparability of data across accounting systems, and
3.1.4. Improve consolidation of data across accounting systems for DoD-wide reporting.
3.2 Account Structure
The basic SCOA structure consists of a 6-digit USSGL account number followed by a
period and a 4-digit DoD account extension. SGL accounts with an extension of “.9000” (e.g.,
101000.9000, 211000.9000) are identified as Treasury level USSGL accounts. SGL accounts with
extensions other than .9000 are DoD specified accounts. The basic structure of the DoD SCOA
follows that of the USSGL. The basic 6-digit structure of the USSGL consists of:
100000 Assets
200000 Liabilities
300000 Net Position
400000 Budgetary
500000 Revenue and Other Financing Sources
600000 Expenses
700000 Gains/Losses/Miscellaneous Items
800000 Memorandum
3.3 DoD USSGL Transaction Library
3.3.1. The Library establishes enterprise-wide implementation requirements and provides
a framework with detailed transaction and posting rules for updating existing financial systems
and deploying new accounting systems.
3.3.2. The Library is a decomposition of the accounting transactions from the TFM, Part
1, Section III USSGL Supplement, that provides both budgetary and proprietary accounting entries
for events occurring throughout the federal government. The Library organizes generalized
Treasury USSGL business event transactions into appropriate pairings of budgetary, proprietary,
and memorandum accounts uniquely identified by DoD Transaction Codes (DTCs).
3.3.3. Components must not group multiple DTCs into one transactional posting, so that
the individual transaction posts separately and supports each business event and is uniquely
identified in the business process. While Component financial systems are not required to store
and maintain the exact DTC reference used in the Library for each posted transaction, Component
or agency financial systems must maintain a chart of accounts and utilize general ledger posting
logic that produces the same business event result as the DoD USSGL Transaction Library.
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3.3.4. The SCOA, USSGL Transaction Library, Account Attribute Alignment File, and
Tie-Points are updated as applicable following each corresponding Treasury update to ensure DoD
policy aligns with the current USSGL Supplement.
3.4 Reporting
3.4.1. All DoD accounting systems must report financial transactions to DDRS using the
account structure of the SCOA. Detailed attribute alignment at the SGL account level is updated
concurrently with the SCOA.
3.4.2. Components must implement the SCOA to satisfy both internal and external
reporting requirements. For external reporting, all budgetary and proprietary financial reporting
data are summarized in DDRS into the six-digit USSGL accounts and GTAS standard attributes.
3.4.3. Components must ensure systems provide complete, reliable, consistent, and timely
budgetary and proprietary transaction-level information and are recorded in accounting systems
of record general ledgers to produce auditable budgetary, proprietary, and managerial cost
accounting reports for internal and external stakeholders.
4.0 ACCOUNT RELATIONSHIPS
4.1 Budgetary and Proprietary Accounts
4.1.1. The SGL account structure provides a self-balancing set of budgetary accounts to
record the appropriation, apportionment, allotment, allocation, commitment, obligation, and
expenditure process. The SCOA is driven by debit and credit normal balance indicators, so debits
should always equal credits. The budgetary total and budgetary resources accounts should always
equal the total status of budgetary resources accounts.
4.1.2. The SGL account structure provides a self-balancing set of proprietary accounts to
report the results of operations and net position. Proprietary asset and liability accounts cover the
collection and disbursement of funds, the proper classification of assets (e.g., Fund Balance with
Treasury, receivables, advances and prepayments, inventory, and fixed assets), and the recognition
and proper classification of liabilities. Revenue and expense accounts measure the realization of
revenues from the sale of goods and services, and the recognition of costs, including gains and
losses through the use and consumption of assets. Total asset accounts should always equal total
liability accounts plus net position.
4.1.3. Accurate posting of budgetary and proprietary transactions to the SGL enables
budgetary, proprietary, and managerial cost accounting essential for good stewardship, proper
financial control over resources, and financial reporting.
4.2 Accounts Applicable to Fund Type
4.2.1. The SCOA identifies SGL accounts applicable to General Fund, Working Capital
Fund (WCF), and Special and Trust Funds. The SCOA also identifies those USSGL accounts that
are not applicable to the DoD.
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4.2.2. Component accounting systems must incorporate, at a minimum, those SGL
accounts and posting logic for applicable business processes and transactions. For example,
general fund accounting systems must include, at a minimum, accounts designated as applicable
to general funds, and not those restricted to working capital or special/trust fund systems.
Similarly, WCF accounting systems must include accounts designated as applicable to WCF but
not those accounts restricted to general or special/trust fund systems. Combined systems handling
both general and WCF must include both general and working capital general ledger accounts, but
not those accounts restricted to special/trust fund systems. Components are not required to add
accounts designated as not applicable for DoD.
4.3 Account Attributes
4.3.1. The account attributes required for Treasury reporting of both budgetary and
proprietary account information are defined in the TFM USSGL Supplement,
Section IV, USSGL Account Attributes.
4.3.2. The data structure for each SGL account attribute is defined in the SFIS Matrix, to
include syntax and allowable values. The SFIS Matrix and the SFIS Values Library are located
on the SFIS web page.
4.3.3. When including specific general ledger accounts in an accounting system, all
attributes assigned to the specific general ledger accounts must also be included and correctly
aligned to those accounts.
4.3.4. Allowable values for each SGL account attribute are identified and defined at the
SGL account level in the SCOA Attribute Alignment File published on the SFIS web page.
4.4 Request for Account Exemption
4.4.1. A Component’s specific mission area may allow for an accounting system
exemption to certain SGL accounts. Components must request an exemption from standard DoD
account alignment based on business processes and transactions within a specific fund type.
* 4.4.2. The SCOA is re-published annually with updates. Component system owners must
review existing accounts and submit any changes or revisions to the OUSD(C)/CFO) within 30
days of the SCOA update.
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4.5 DoD Assigned USSGL Accounts
The SCOA includes five specific accounts for recording internal fund distributions within
direct program authority (see Figure 7-1). Refer to Volume 3, Chapters 13, 14, and 15 for policy
on the use and application of these accounts at the Department and execution levels. Funds
distribution guidance for the Military Services and Office of the Secretary of Defense Treasury
Index-97 organizations is located at SFIS under the “DoD Accounting Scenarios” section.
Figure 7-1. DoD Assigned Accounts for Internal Fund Distributions
Account Number: 454000.9000
Account Title: Internal Fund Distributions Issued
Normal Balance: Credit
Definition: The amount of direct budgetary authority allotted from department, headquarters, or
Office of the Secretary of Defense (OSD) level to intermediate or execution level, as determined
by organizational funding structure.
Account Number: 455000.9000
Account Title: Internal Fund Distributions Received
Normal Balance: Debit
Definition: The amount of direct budgetary authority received from department, headquarters,
or OSD level by an intermediate level component.
Account Number: 456000.9000
Account Title: Funds Available for Allotment
Normal Balance: Credit
Definition: The amount of direct budgetary authority available at an intermediate level
component for allotment to execution level component(s) or for suballotment to other
intermediate level component(s).
Account Number: 457000.9000
Account Title: Allotments Issued
Normal Balance: Credit
Definition: The amount of direct budgetary authority either allotted by an intermediate level
component to an execution level component(s), or suballotted between two or more intermediate
or execution level components.
Account Number: 458000.9000
Account Title: Allotments Received
Normal Balance: Debit
Definition: The amount of direct budgetary authority received by an execution level
component through either allotment or suballotment of authority.
DoD 7000.14 - R
DEPARTMENT OF DEFENSE
FINANCIAL MANAGEMENT REGULATION
CHAPTER 8: "ARCHIVED"
UNDER SECRETARY OF DEFENSE
(COMPTROLLER)
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 9
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VOLUME 1, CHAPTER 9: “FINANCIAL RECORDS RETENTION”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated February 2021 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Administrative updates in accordance with Department of
Defense Financial Management Regulation (FMR) Revision
Standard Operating Procedures.
Revision
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 9
* March 2024
9-2
Table of Contents
VOLUME 1, CHAPTER 9: “FINANCIAL RECORDS RETENTION” ...................................... 1
1.0 GENERAL ........................................................................................................................ 3
1.1 Purpose .......................................................................................................................... 3
1.2 Authoritative Guidance ................................................................................................. 3
2.0 RETENTION REQUIREMENTS .................................................................................... 4
2.1 Record Retention Requirements .................................................................................... 4
2.2 Documentation Requirements ....................................................................................... 5
FIGURE 9-1. MINIMUM RETENTION PERIODS ................................................................. 6
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CHAPTER 9
FINANCIAL RECORDS RETENTION
1.0 GENERAL
1.1 Purpose
This chapter identifies the proper retention period for financial records. This policy applies
only to the records supporting financial transactions and financial statement balances or necessary
to document evidence of effective internal controls over financial reporting (e.g., reviews and
approvals). This policy does not apply to related management records, such as maintenance logs,
and other documents important for proper management of Department of Defense (DoD)
operations but incidental to the support of financial transactions and balances, unless the records
are being used as secondary evidence to support financial transactions and balances.
1.2 Authoritative Guidance
1.2.1. The National Archives and Records Administration (NARA) promulgates
requirements for the management and disposal of all United States (U.S.) Government records.
1.2.1.1. Title 36, Code of Federal Regulations (CFR), Chapter XII, Subchapter B,
Parts 1220-1239 (36 CFR §§ 1220 – 1239) provides NARA general policies.
1.2.1.2. NARA’s disposal guidance for administrative records are outlined in
General Records Schedule (GRS) 5.7, “Administrative Management and Oversight Records.”
1.2.2. Federal Acquisition Regulations (FAR), Part 4.805 provides procedures and
schedules for storage, handling, and disposal of contracting office records.
1.2.3. The DoD records management policy and responsibilities are outlined in
DoD Instruction 5015.02, “DoD Records Management Program.”
1.2.3.1. Within DoD, there are several Records Management Programs, each with
an appointed Federal Agency Records Officer; Records Management Manual, Instruction, or
Regulation; and Records Disposition Schedules (RDS). NARA approves all records identified in
DoD’s RDS, which can contain additional financial records used in DoD business operations that
are not listed in the NARA GRS.
1.2.3.2. The DoD Directive 3210.06, “Defense Grant and Agreement Regulatory
System,” provides for the collection, retention, and dissemination of management and fiscal data
related to grants activities.
1.2.3.3. The DoD Guidebook for Miscellaneous Payments provides guidance on
supporting financial documentation for miscellaneous transactions.
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2.0 RETENTION REQUIREMENTS
2.1 Record Retention Requirements
2.1.1. Title 44 United States Code Section 3301 defines the term “records” to include all
recorded information, regardless of form or characteristics, made or received by a Federal agency
under Federal law or in connection with the transaction of public business and preserved or
appropriate for preservation by that agency or its legitimate successor as evidence of the
organization, functions, policies, decisions, procedures, operations, or other activities of the
U.S. Government or because of the informational value of data in them. Records do not include
library and museum material made or acquired and preserved solely for reference or exhibition
purposes; or duplicate copies of records preserved only for convenience.
2.1.2. NARA GRS 1.1, “Financial Management and Reporting Records”
2.1.2.1. GRS 1.1 provides disposition authority for records created and received in
the course of carrying out an agency’s financial management and reporting responsibilities.
Financial management includes procuring goods and services, paying bills, collecting debts,
accounting for all financial transactions, and monitoring net worth.
2.1.2.1.1. GRS 1.1 covers financial records of grants and cooperative
agreements. The administrative records of grants and agreements are covered in GRS 1.2.
2.1.2.1.2. GRS 1.1 covers financial transactions and reporting records.
Records for financial planning (i.e., budgeting records) are covered under GRS 1.3.
2.1.2.1.3. GRS 1.1 covers contract records maintained by Federal agencies.
Contractor-maintained contract records are governed by FAR, Part 4, Subpart 4.7.
2.1.2.1.4. GRS 1.1 covers financial transactions as an administrative
function common to all agencies, but not administrative records documenting unique agency
missions, such as student loan collection or seeking reimbursement for Superfund cleanups.
2.1.2.2. Each record noted within the GRS includes the item number, the records
description, the disposition instructions that describe the point at which an item can be destroyed
(unless longer retention is authorized and required for “business use”), and the disposition
authority for records created and received in the course of carrying out an agency’s financial
management and reporting responsibilities.
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2.1.3. Figure 9-1 provides general guidelines for minimum retention periods by assessable
unit in support of the DoD-wide financial statement audit. Supporting a financial statement audit
is an example of “business use” where documentation must be retained for a longer period of time
than required by NARA in order to preclude a scope limitation. During an audit, management
must furnish a written representation as to the availability of all financial records and related data
and the auditors must obtain a reasonable basis for an opinion. These guidelines must be
supplemented by professional judgment that considers the specific circumstances related to each
financial transaction. For records supporting financial statement audits and held for purposes other
than a financial statement audit that require a longer retention period, continue to follow
appropriate document retention guidance. At a minimum, Components must comply with NARA
and the DoD Records Management Program requirements.
2.1.4. Consult your DoD appointed Federal Records Officer for additional guidance
regarding record retention.
2.2 Documentation Requirements
Component financial transaction records must be prepared, retained, and, at a minimum,
support the following:
2.2.1. Authority. Evidence the transaction was approved and/or certified in accordance
with established requirements.
2.2.2. Amount. Evidence of transactions dollar values.
2.2.3. Date. Evidence of transaction dates to ensure transactions are recorded in the proper
accounting period.
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FIGURE 9-1. MINIMUM RETENTION PERIODS
Assessable Unit(s)
Type of Documentation
Minimum Retention Period
Contract Pay /
Vendor Pay /
Interfund /
Intragovernmental
Financial transaction records related to
procuring goods and services, paying
bills, collecting debts, and accounting.
Retain key supporting documents
(KSDs) for the following financial
statement line items (FSLIs):
• Accounts Payable
• Accounts Receivable
• Uncollec
ted payments, federal
sources, brought forward
•
Unpaid obligations, brought
forward
•
Unobligated balance, brought
forward
• Other liabilities
• Revenue
• Gross Cost
Ten years after the final invoice or
Intra-
Government Payment and
Collection
or other similar
documentation.
Note: This is an increase over the
NARA six-year minimum retention
standards, is applicable to contract
payment offices, and includes
obligation document records.
Financial Reporting
/ Accounting
Records supporting compilation of
agency financial statements and related
audit, and all records of all other
reports.
Retain KSDs for the following FSLIs:
• Financial Reporting
• Other Adjustments
Two years after completion of
financial statement audit for which
the records were initially prepared.
Note: The remaining categories are
consistent with the NARA
minimums. As these documents
will not be required to support more
than the year under, and subsequent
year audit(s), no more than a two-
year retention period is necessary.
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FIGURE 9-1. MINIMUM RETENTION PERIODS (Continued)
Assessable Unit(s)
Type of Documentation
Minimum Retention Period
Property, Plant and
Equipment /
Inventory /
Operating Materials
and Supplies
Records supporting the book value,
ownership, and any modifications to
assets.
Retain KSDs for the following FSLIs
and/or Notes to the Financial
Statements:
• General Equipment
• Real Property
• Internal Use Software
• Inventory and Related Property
• Other Assets
Two years after asset is disposed of
and/or removed from agency’s
financial statements.
Civilian Pay /
Military Pay
Records documenting payroll and
benefit disbursements and liabilities.
Retain KSDs for the following FSLIs
and/or Notes to the Financial
Statements:
• Other Liabilities
• Gross Costs
•
Military Retirement and Other
Federal Employment Benefits
Two years after pay period.
Fund Balance with
Treasury (FBWT)
Documentation supporting the
reporting and reconciliation of FBWT.
Retain KSDs for Fund Balance with
Treasury.
Two years after the month of the
Reconciliation or Report is
prepared.
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 10
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VOLUME 1, CHAPTER 10: “ADVANA – COMMON ENTERPRISE DATA
REPOSITORY FOR THE DEPARTMENT OF DEFENSE”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated November 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Administrative updates in accordance with Department of
Defense Financial Management Regulation Revision
Standard Operating Procedures.
Revision
2.2
Additional clarifying language.
Revision
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 10
* June 2023
10-2
Table of Contents
VOLUME 1, CHAPTER 10: “ADVANA – COMMON ENTERPRISE DATA REPOSITORY
FOR THE DEPARTMENT OF DEFENSE” .................................................................................. 1
1.0 GENERAL......................................................................................................................... 3
1.1 Overview ........................................................................................................................ 3
1.2 Purpose ........................................................................................................................... 3
1.3 Authoritative Guidance .................................................................................................. 3
2.0 ROLES AND RESPONSIBILITIES ................................................................................. 4
2.1 OUSD(C) Responsibilities ............................................................................................. 4
*2.2 DoD Component Responsibilities .................................................................................. 4
3.0 BUSINESS DOMAIN AREAS ......................................................................................... 5
DoD 7000.14-R Financial Management Regulation Volume 1, Chapter 10
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CHAPTER 10
ADVANA – COMMON ENTERPRISE DATA REPOSITORY FOR THE
DEPARTMENT OF DEFENSE
1.0 GENERAL
1.1 Overview
Advana (derived from the term “Advancing Analytics”) is a common enterprise data
repository for the Department of Defense (DoD), required by the National Defense Authorization
Act (NDAA) for Fiscal Year (FY) 2018. Advana is a centralized data and analytics platform that
provides DoD users with common business data, decision support analytics, and data tools. It was
developed by the Office of the Under Secretary of Defense (Comptroller) (OUSD(C)), through the
Directorate for Enterprise Financial Transformation (EFT), and is now maintained by the Chief
Digital and Artificial Intelligence Office. The Advana platform and program supports the National
Defense Strategy by amassing data that is accessible, understandable, and usable across the
Defense enterprise, and by advancing analytic capabilities to address the complex challenges of
the Department.
1.2 Purpose
This chapter establishes Advana as an official DoD repository of common enterprise data
and the roles and responsibilities of OUSD(C) and DoD Components in the development,
maintenance, and use of Advana within the supported business domain areas. The use of Advana
will ensure that any performance measure or data product that relies on DoD data originates from
an authoritative source of transaction-level detail.
1.3 Authoritative Guidance
The policy and related requirements prescribed by this chapter are in accordance with the
applicable provisions of:
1.3.1. Title 10, United States Code, sections 135 and 2222 as amended by the NDAA for
FY 2018 (sections 911 – 913).
1.3.2. Public Law 113-101, Digital Accountability and Transparency Act of 2014.
1.3.3. Statement of Federal Financial Accounting Standards 4, “Managerial Cost
Accounting Standards and Concepts.”
1.3.4. DoD National Defense Strategy, issued by the Secretary of Defense.
1.3.5. DoD Annual Performance Plan, issued by the Director of Administration and
Management.
1.3.6. OUSD(C), Financial Management Strategy.
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1.3.7. Acting Assistant Deputy Chief Financial Officer (DCFO) memorandum
(December 2020), “Advancing Analytics (Advana) Financial Reconciliations for the Fourth
Estate.”
2.0 ROLES AND RESPONSIBILITIES
2.1 OUSD(C) Responsibilities
The Department’s vision of “Financial Management (FM) Analytics” outlines the
expectations of tomorrow’s financial management professionals, leveraging the foundation of
auditable data to drive more meaningful, data-informed decisions of the future. Using Advana as
an enabler and accelerator for FM Analytics, OUSD(C) will:
2.1.1. Leverage data as a strategic asset, connecting it with advancing technology to
continuously advance analytic capabilities across the Department. Any data contained in a
Defense business system related to business operations and management is an asset of the
Department, and a strategy must be developed for making the data discoverable in Advana.
2.1.2. Maintain alignment of Advana capabilities and products with the functional
requirements of its customers by communicating and validating regularly with the user community
as continuous development occurs, partnering with the appropriate officials to establish enterprise
standards.
2.1.3. Acquire, incorporate, and standardize data to support the business domain areas that
align with the organizational structure of the Department and the responsibilities of DoD
Components.
2.1.4. Manage data sharing agreements with system owners to ensure data is timely and
accurate. Extract data from the relevant systems to facilitate DoD-wide analysis and management
of business operations, and execute controls over data management.
2.1.5. Provide reasonable assurance to data consumers that data controls are clearly
defined and executed in accordance with control objectives.
2.1.6. Maintain regulated security over the system and its data and ensure compliance with
user access security requirements and DoD continuity of operations policy and planning.
2.1.7. Ensure sensitive activity data is secure and comply with DoD security classification
guidance.
*2.2 DoD Component Responsibilities
DoD Components (i.e., the Office of the Secretary of Defense, the Military Departments,
the Office of the Chairman of the Joint Chiefs of Staff and the Joint Staff, the Combatant
Commands, the Defense Agencies and DoD Field Activities, and all other organizational entities
within DoD with the exception of the DoD Office of Inspector General) must:
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2.2.1. Provide authoritative source-level transactional data to Advana from all DoD
business systems daily, using the most cost effective and secure methods available. The
authoritative source-level transactional data must be obtained and imported by Advana from the
business system in which the data originated (i.e., not a separate data warehouse or data lake but
the system that originated the transaction). Where a strategy does not exist to provide such data,
one must be developed in partnership with OUSD(C) EFT.
2.2.2. Sign agreements that govern accurate and timely transmission of data. DoD
Components are responsible for defining business rules that map source data elements to the
Advana common data model. The Advana common data model includes but is not limited to the
Standard Financial Information Structure, Procurement Data Standard, and subsequent domain-
specific data models under development.
2.2.3. Use Advana for delivery of their Universe of Transactions to any entity that issues
an audit request, data call request, or other bona fide requirement for reconciled transaction details.
2.2.4. Use the Advana Feeder to General Ledger Reconciliations Audit Workbooks –
Monthly reconciliations between disbursing, obligation, funding, and entitlement financial
management systems to general ledger accounting systems.
2.2.5. Use the General Ledger to Unadjusted Trial Balance Reconciliations Audit
Workbooks – Quarterly reconciliations between general ledger accounting systems and their
unadjusted trial balance.
2.2.6. Use the Unadjusted Trial Balance to Adjusted Trial Balance Reconciliations Audit
Workbooks – Quarterly reconciliations between the unadjusted trial balance and the adjusted trial
balance within the Defense Departmental Reporting System.
2.2.7. Use Advana to reconcile Fund Balance with Treasury and retire all legacy micro-
applications no later than December 2024.
2.2.8. Use the Advana Dormant Account Review – Quarterly tool to conduct all DoD
dormant account reviews unless otherwise approved by OUSD(C) EFT and DCFO.
2.2.9. Provide functional assistance to the Advana program, when necessary, to reconcile
DoD Components’ general ledger data to outputs from the Defense Departmental Reporting
System and other required data reconciliations.
3.0 BUSINESS DOMAIN AREAS
A business domain represents a line of business for DoD and its corresponding business
events. Advana will acquire, incorporate, and standardize data to support the various business
domain areas across the Department including, but not limited to:
3.0.1. Acquisition Analytics
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10-6
3.0.2. Budget Analytics
3.0.3. Cost Management Analytics
3.0.4. Executive Analytics
3.0.5. Financial Management, Reporting, and Accounting Analytics
3.0.6. Health Analytics
3.0.7. Information Technology Analytics
3.0.8. Logistics and Supply Chain Analytics
3.0.9. People Analytics
3.0.10. Policy Analytics
3.0.11. Procurement Analytics
3.0.12. Readiness Analytics
3.0.13. Real Property Analytics
2BDoD 7000.14-R Financial Management Regulation Volume 1, Appendix A
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A-1
VOLUME 1, APPENDIX A: “OBJECT CLASSIFICATION”
SUMMARY OF MAJOR CHANGES
Changes are identified in this table and also denoted by blue font.
Substantive revisions are denoted by an asterisk (*) symbol preceding the section,
paragraph, table, or figure that includes the revision.
Unless otherwise noted, chapters referenced are contained in this volume.
Hyperlinks are denoted by bold, italic, blue, and underlined font.
The previous version dated April 2020 is archived.
PARAGRAPH
EXPLANATION OF CHANGE/REVISION
PURPOSE
All
Updated the hyperlinks and formatting to comply with the
Department of Defense Financial Management Regulation
Revision Standard Operating Procedures.
Revision
2BDoD 7000.14-R Financial Management Regulation Volume 1, Appendix A
* March 2023
A-2
Table of Contents
1.0 GENERAL......................................................................................................................... 3
1.1 Purpose ........................................................................................................................... 3
1.2 Basic Concepts ............................................................................................................... 3
2.0 MAJOR OBJECT CLASSIFICATION ............................................................................ 4
2BDoD 7000.14-R Financial Management Regulation Volume 1, Appendix A
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A-3
APPENDIX A
OBJECT CLASSIFICATION
1.0 GENERAL
1.1 Purpose
The purpose of this appendix is to provide necessary information on the object classes that
are used as a uniform classification for identifying the transactions of the Federal Government by
the nature of the goods or services purchased. Every obligation recorded by the Department of
Defense (DoD) must be coded with an object class. Every purchase requisition and commitment
recorded by the DoD must be coded with an object class code and product service code.
1.2 Basic Concepts
1.2.1. Obligations incurred are the amounts of orders placed, contracts awarded, services
received, and similar transactions during an accounting period that will require payment during
the same or a future period. Such amounts include payments for which obligations have not been
previously recorded, along with adjustments for differences between obligations previously
recorded and actual payments to liquidate those obligations. The installation-level budgetary
account structure requires that the amount of obligations incurred be segregated into undelivered
orders and accrued expenditures - unpaid or paid.
1.2.2. Obligations are classified by the initial purpose for which they are incurred, rather
than for the end product or service provided. For example, if payments are made directly for
personal services or supplies used in the construction of a building, the amounts should be
classified as obligations for personnel compensation or supplies rather than for land and structures.
Conversely, if contracts are awarded for the construction of a building, the amounts should be
classified in the object class for lands and structures rather than in the object class used to report
individual types of materials and services required to construct the building.
1.2.3. Object class information is incorporated into DoD accounting systems, or derived
from applicable expense and asset accounts, to allow for reporting by object class. Object Class
Code is a required data element in the DoD Standard Financial Information Structure (SFIS), as
defined in Volume 1, Chapter 4. Based on the Office of Management and Budget (OMB) Circular
A-11, the specific values for Object Class Code and all other SFIS data elements are documented
in the SFIS Values Library Service on the SFIS web page.
2BDoD 7000.14-R Financial Management Regulation Volume 1, Appendix A
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2.0 MAJOR OBJECT CLASSIFICATION
All Federal Government object classifications are defined in the OMB Circular No. A-11,
Part 2, III, Section 83, Schedule O. These are the major object classes:
2.01. 10 Personnel compensation and benefits
2.02. 20 Contractual services and supplies
2.03. 30 Acquisition of assets
2.04. 40 Grants and fixed charges
2.05. 90 Other