CTMA Project #: 140484
Problem: The National Defense Authorization Act (NDAA) for Fiscal Year 2010 directed that “The Chief Management Officer of the Department of Defense (DoD) shall, in consultation with the Under Secretary of Defense (Comptroller) (USD (C)), develop and maintain a plan to be known as the Financial Improvement and Audit Readiness (FIAR) Plan”.
The Under Secretary of Defense for Acquisition Technology and Logistics (USD (AT&L)) echoed USD (C) priorities for the FIAR Plan “to validate the existence and completeness (E&C) of mission-critical assets on the path to complete financial statement audit readiness” defined as the following:
- Existence – all accountable property in DoD systems of record exists and their records match actual physical assets.
- Completeness – all accountable property is identified and accurately recorded in a DoD system of record.
The current version of the FIAR Guidance, published in December 2011, is a four-part approach for Service components to achieve audit readiness. Mission critical assets are a key consideration under the FIAR plan including the subsets of Military Equipment (ME) and Operating Materials and Supplies (OM&S) that are the primary focus of the Deputy Commandant for Installations and Logistics (DC I&L). USD (AT&L) defines ME as weapons systems used directly by the Armed Forces to carry out battlefield missions, has an expected useful life of two or more years, and does not lose its identity or become a component part of another article. The target ME assets for audit readiness are those with an acquisition cost of $100,000 or greater and include assets such as light armored vehicles, howitzers, tanks, and certain communications equipment.
Benefit: This project will enable our industry partners to better anticipate equipment requirements in support of reconstitution and the critical transition to a Middle Weight force. The military learns from industry using best practices to better account for its equipment based on operational user observations and suggestions with an emphasis on understanding total ownership costs. Industry is better able to satisfy Marine Corps requirements when they are well defined based on careful analysis, sound data, and best commercial practices. Industry partners may later leverage those lessons learned to products they produce for commercial consumers.
Solution/Approach: Deputy Commandant for Installations and Logistics (DC I&L) established an E&C Integrated Product Team (IPT) to improve business processes and steer actions for the Marine Corps FIAR audit readiness efforts to comply with the Department of the Navy (DoN) schedule for asserting to audit readiness for the E&C of ME by FY14. The IPT will review and improve the sustainable process to maintain an effective and efficient inventory management strategy into the future to improve equipment accountability and visibility.
On 2 March 2011, the Assistant Commandant of the Marine Corps (ACMC) tasked the DC I&L with establishing a Marine Corps Enterprise Ground Equipment Manager (EGEM) to execute Principle End Item (PEI) inventory management. Key aspects include ownership of inventory distribution, delivery, coordination, reporting, and visibility to manage and communicate PEI inventory posture to meet Marine Corps-wide equipping needs and accountability requirements. Per CMC White Letter 03-08 of 16 May 2008 and DODI 5000.64, property accountability is a multi-step, multi-player process. This process requires logistic chain management corrective action between stakeholders to include HQMC-level financial management (Programs and Resources (PR)), acquisition (MARCORSYSCOM and Program Executive Offices (PEOs)), and Logistics (I&L and MARCORLOGCOM) to improve processes to achieve equipment accountability and visibility (EAV) for audit readiness.
The objective of this project is to analyze and document the accountability processes pertaining to the existence and completeness of military equipment as required by the FIAR Plan and to inform DC I&L chain management corrective actions as the EGEM.
Impact on Warfighter: This project will assist in improving equipment accountability throughout the Marine Corps by assisting in the establishment of the EGEM, in:
- Validating the Master Data Repository.
- Improving military equipment accountability processes to produce cost efficiencies.
- While supporting the warfighter with the equipment needed to complete their mission.
DOD Participation:
- Marine Corps Requirements Oversight Council (MROC)
- Deputy Commandant, Installations and Logistics (DC I&L)
- Marine Corps Combat Development Council (MCCDC)
- Marine Corps Systems Command (MCSC)
- Marine Corps Logistics Command (MCLC)
- Marine Forces Commands (MARFORs)
Industry Participation:
- The Columbia Group
- NCMS
