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References DSCA 05-59.
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DEFENSE SECURITY COOPERATION AGENCY
201 12th STREET SOUTH, STE 203
ARLINGTON, VA 22202-5408

11/18/2020

MEMORANDUM FOR :

DEPUTY UNDER SECRETARY OF THE AIR FORCE FOR INTERNATIONAL AFFAIRS
DEPUTY ASSISTANT SECRETARY OF THE ARMY FOR DEFENSE EXPORTS AND COOPERATION
DEPUTY ASSISTANT SECRETARY OF THE NAVY FOR INTERNATIONAL PROGRAMS
DIRECTOR, DEFENSE CONTRACT MANAGEMENT AGENCY
DIRECTOR FOR SECURITY ASSISTANCE, DEFENSE FINANCE AND ACCOUNTING SERVICE - INDIANAPOLIS OPERATIONS
DIRECTOR, DEFENSE INFORMATION SYSTEMS AGENCY
DIRECTOR, DEFENSE LOGISTICS AGENCY
DIRECTOR, DEFENSE LOGISTICS INFORMATION SERVICE
DIRECTOR, DEFENSE REUTILIZATION AND MARKETING SERVICE
DIRECTOR, DEFENSE THREAT REDUCTION AGENCY
DIRECTOR, NATIONAL GEOSPATIAL INTELLIGENCE AGENCY
DEPUTY DIRECTOR FOR INFORMATION ASSURANCE, NATIONAL SECURITY AGENCY
DIRECTOR, MISSILE DEFENSE AGENCY

SUBJECT :

Monthly Oversight and Review of Performance Reporting, DSCA Policy 20-72, SAMM E-Change 507

REFERENCE :

  1. Department of Defense 7000.14-R, Financial Management Regulation (FMR), Volume 15, Chapter 8
  2. DSCA Manual 5105.38, Security Assistance Management Manual (SAMM), Chapters 9, 16, and Appendix 7 (Reconciliation and Closure Guide (RCG))
  3. DSCA Policy Memo 5-29, Importance of FMS Case Delivery Reporting, dated November 23, 2005
  4. GAO Audit NFR Reference 20-386, DOD Should Further Strengthen Oversight of Transportation Fees Recommendations 1 and 2

Implementing Agencies (IAs) are required to submit performance reporting to Defense Finance Accounting Service (DFAS) of either physical or constructive deliveries within 30 days of the date of shipment, performance or constructive delivery (items are considered delivered when Title passes to the purchaser) in accordance with the DoD Financial Management Regulation (FMR) Vol 15, Chapter 8 and DSCA SAMM Chapter 16, and Appendix 7 Chapter 2.

The Government Accountability Office (GAO) noted in audit report 20-386 that, although there is a requirement for the IAs to report performance/delivery within a 30-day timeframe to DFAS, the agencies and DSCA lacked a review mechanism to ensure deliveries were reported timely and accurately.

Each agency's adherence to current policy and guidance is essential. Timely and accurate delivery reporting is not only a requirement but an important part of overall case execution and needed to evaluate the merits of any submitted Supply Discrepancy Report. Performance reporting is essential to accurately report deliveries to the partner, calculating and collecting surcharges into the Transportation Cost Clearing Account, and reporting delivery information to Congress and other entities.

Based on the GAO audit and recommendation, DSCA/DBO/FPA is implementing a process to review the DFAS/Security Cooperation Accounting (SCA) monthly report "IA Delivery Report Card" to monitor the accuracy and timely reporting of deliveries. The IAs are required to provide a copy of their Standard Operating Procedure (SOP) to identify the process and procedure they follow to report performance/delivery in accordance with DoD FMR and SAMM guidance. The SOPs should also include the IAs process for reviewing the IA Delivery Report Card, which allows them to identify issues requiring further review and facilitate corrective measures to resolve any identified concerns such as systems and interface issues, process breakdowns, and organizational training/compliance issues. In addition to the DSCA review of the monthly report card, DFAS and the IAs will continue to review and reconcile delivery reporting and other reports as required in the DoD FMR and SAMM including the Annual Case Reviews. To assist the with implementing this process, implementation guidance identifying each agency's responsibility to review the IA Report Card is contained in Attachment 1 and a sample of the "IA Delivery Report Card" is included at Attachment 2.

For any questions regarding this policy, please contact Mr. Sungjae (Justin) Lee at sungjae.j.lee.civ@mail.mil or 703-697-6587.

J. Aaron Harding
Chief Financial Officer

ATTACHMENT :

  1. Implementation Guidance - Monthly Performance/Delivery Reporting Review

  2. Sample IA Delivery Report Card

Security Assistance Management Manual (SAMM), E-Change 507
Monthly Oversight and Review of Performance Reporting

1) ADD:

C9.13.3. Performance/Delivery Reporting Monthly Review. DFAS will generate and provide a monthly IA Report Card to DSCA (Directorate of Business Operations (DBO) Financial Policy & Analysis Division (FPA)) and the IAs to include delivery reporting trends and detailed delivery transaction data. DSCA/FPA, DFAS/SCA, and the IAs will review and analyze the data provided to include trends for deliveries reported over the 30-day reporting requirement to determine the root cause and implement corrective actions.

IMPLEMENTATION GUIDANCE
MONTHLY PERFORMANCE/DELIVERY REPORTING REVIEW

This guidance is being provided to implement the monthly review of timely and accurate performance/delivery reporting.

Roles and Responsibilities

DSCA/DBO Financial Policy and Analysis (FPA)

DSCA/DBO/FPA will conduct a review of all Implementing Agency (IA) Delivery Report Cards. This will ensure that performance/delivery reporting is being conducted in a timely manner and in accordance with the DoD FMR Volume 15, Chapter 8, DSCA SAMM Chapters 9, 16, and Appendix 7, Chapter 2. DSCA/DBO/FPA will work with Defense Finance Accounting Service (DFAS) and the IAs to update or modify the IA Delivery Report Card as necessary to ensure the most effective tool is available. DSCA/DBO/FPA will analyze data provided to determine trends for late reporting by IAs over the 30 day timeline. In addition to a review, metrics will be tracked to determine if there are systemic issues with a specific IA or Country portfolio (i.e. Country Code). DSCA/DBO/FPA will contact the appropriate IA Performance Reporting Focal Point and work with the IA to determine the cause. Once a cause is determined, DSCA/DBO/FPA will work with DFAS and/or the IA to correct the issue and bring performance/delivery reporting into compliance with the timelines.

DSCA/DBO/FPA will develop an overarching Standard Operating Procedure (SOP) for the review of the IA Delivery Report Card. This SOP will include the roles and responsibilities for DSCA, DFAS, and the IAs for reviewing performance/delivery data for timeliness and accuracy trends. In addition, the DSCA SOP will include internal SOPs from each IA detailing their internal review process including Process Maps. DSCA/DBO/FPA will finalize the SOP and provide to the DSCA/DBO/Financial Audit & Systems (FA&S) Team for review and approval and closure of the GAO Corrective Action Plan.

DSCA/DBO/FPA will provide DFAS and the IAs with a Point of Contact for the IA Delivery Report Card and performance/delivery reporting issues to ensure open and timely communication.

DFAS

DFAS will provide a copy of the IA Delivery Report Card to DBO/FPA and each IA monthly. DFAS will work with DSCA/DBO/FPA and the IAs to update or modify the IA Report Card as may be necessary to ensure the most effective tool is available. DFAS will review the IA Delivery Report Card as well as other required performance reports and delivery listings. DFAS will highlight on the IA Delivery Report Card each delivery report that has not been submitted in accordance with timeframes identified in the DoD FMR Volume 15, SAMM Chapters 9, 16, and Appendix 7, Chapter 2. DFAS will work with DSCA and/or the IAs as required to ensure all transactions entered are being reported within the 30-day timeframe provided and any C-1 transactions errors are corrected in a timely manner. Finally, DFAS will ensure that there are no systems, interface, or process issues that cause delays or erroneous transactions to process. If errors or problems are identified in the above areas, DFAS must notify DSCA/DBO/FPA and the IA of the issue, take action to research the root cause and work with the appropriate entities (DSCA/DBO/FPA, IAs, Systems Owners, etc.) to correct the issue immediately.

DFAS will provide DSCA/DBO/FPA with a copy of the internal SOP within 60 days of the implementation of this policy to include Process Map for developing, distributing and reviewing the IA Delivery Report Cards and resolving issues lateness and accuracy issues within the DFAS area of responsibility.

DFAS will provide DSCA and the IAs with a Point of Contact for the IA Delivery Report Card and performance/delivery reporting issues to ensure open and timely communication.

Implementing Agencies (IAs)

IAs will receive a copy of the IA Delivery Report Card monthly. IAs will work with DSCA and DFAS to update or modify the IA Delivery Report Card as may be necessary to ensure the most effective tool is available. IAs are responsible for reviewing performance and delivery reporting in accordance with the DoD FMR Volume 15, Chapter 8 and SAMM Chapters 9, 16, and Appendix 7, Chapter 2. The IAs will review the IA Delivery Report Card and perform transaction reconciliations, trend analysis for any delivery reported greater than the 30 days to determine the root cause of negative trends, and complete corrective actions. The IA should identify any systemic issues such as system interface issues, posting issues, training/process issues, etc. and notify DSCA and DFAS of those systemic issues that require coordinated efforts for resolution. Self-identification of issues facilitates the quick resolution of problems especially those where internal processes or procedures may require intervention.

Each IA will provide DSCA with a copy of the internal SOP to include Process Map for conducting a review of the IA Delivery Report Card, analyzing trends, and resolving issues within 60 days of the issuance of this policy.

In order to ensure open and timely communication, IAs will provide DSCA and DFAS with a Point(s) of Contact for the IA Delivery Report Card distribution and performance/delivery reporting issues.

Sample IA Delivery Report Card

NOTICE:

For a copy of the Sample IA Delivery Report Card, please contact the memo POC: Mr. Sungjae (Justin) Lee - sungjae.j.lee.civ@mail.mil