Integrity - Service - Innovation

DFAS Support and Outlook:Today and for the Future

Terri McKay

September 13 2007

Integrity - Service - Innovation 2

ASMC Session Agenda

DFAS BRAC Transformation.Transformation (Video). Support to the Warfighter & GWOT ReportingCustomer Support~

Wounded Warrior program. Out of Country payments. Applying expertise in a customer environment.

Lessons learned from our audit. Driving toward standardized

DoD capabilities~ ERP FM COE. Shared services support initiatives.

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Why Transform?

DFAS working (with the rest of the Department) to achieve results in these DOD identified high-priority areas: Win the Global War on Terror. Focus on People – Military and Civilian. Increase Efficiency and Effectiveness Across the Board. Transform Enterprise Management.

DFAS results to date since 2001: Productivity increases of 46% Labor cost reductions of $285 million.

4Integrity - Service - Innovation

Status of DFAS Site Closures

Paxtuxent RiverDenver(Most Functions)

Arlington (Realigned)

LawtonDaytonNorfolkPacificSt. LouisOrlando

CharlestonOmahaSan DiegoPensacola NASRock IslandKansas City

Denver(Retire-in-Place)

LexingtonOaklandSan BernardinoSeasideSan Antonio

FY 2006

FY 2008

FY 2009

FY 2007

FY 2010

Site Closure Highlight – Eleven sites have closed on-time and within budget.

* Closed sites are in Red

Sites not Included in BRAC:

• Bratenahl• Europe• Japan• Texarkana

Saufley Field(Retire-in-Place)

FY 2011

Integrity - Service - Innovation 5

Transformation Video

6Integrity - Service - Innovation

DFAS Support to the Warfighter

Financial Perspective

Lead transformation of finance and accounting functions throughout DoD

Perform the DFAS mission at best value for DoD

Attract, develop, and retain a highly capable workforce with

relevant skills and competencies

Attain operational excellence in finance and accounting

services

• Use DFAS resources efficiently and effectively to achieve expected results

• Achieve expected financial results from transformation initiatives

• Optimize processes to meet or exceed industry and government standards

• Increase productivity, reduce errors, and deliver products and services on time

• Identify and mitigate risks to improve processes and internal controls

• Raise the level of relevant skills and competencies to meet anticipated needs

• Attract and retain employees with needed skills and competencies

Learning & Growth Perspective

Internal Perspective

• Establish business requirements for DoD transformation initiatives related to finance and accounting activities

• Execute and/or support deployment of DoD transformation initiatives

MISSIONDirect, approve and perform finance and accounting activities for DoD

VISIONTransforming with the Warfighter to remain the trusted financial partner for DoD

STRATEGIC OBJECTIVESSTRATEGIC GOALS

Support DoD in winning the Global War on Terror

• Support Customers in the Global War on Terror

Customer Perspective

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GWOT CoW - High Level Timeline

Q4 Q1Q2 Q3 Q4Q2 Q3FY 2008FY 2007

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN JUL AUG SEP

Identified Requirements for Documenting “Current” GWOT CoW Process

Complete Current Business Process Assessment – Components

Integrate Current Assessment

Design To Be Process State

Produced GWOT CoW Status of Funds Report for Internal Customers

Created Definitive CoW Report for all Prior Years

In-T

hea

ter

Su

pp

ort

Au

dit

&

Rev

iew

Developed Joint Transition POAM

Identified Comprehensive Set of Audit and Review Activities

Implemented Monthly Summary Reporting Process

Implemented process to monitor GWOT CoW Audits

Establish Joint Training/Transition Teams as required

Complete Retrograde Commercial Vendor Services for Kuwait & Qatar

Bu

sin

ess

Pro

cess

esIn

form

atio

n

Del

iver

y

Systems Engineering CompleteSoftware Development Complete

Systems Testing & Acceptance CompleteFully Operational Systems for Improved Information Delivery

Finalize Plan for Additional Retrogrades to CONUS

Standup Conus Retrograde Support Office

Completed Milestone

Develop Initial GWOT CoW Funds Application Standard Operating Procedure

Implemented Quick Hit Process

Implemented Compliance/Accuracy Review Plan

Publish GWOT CoW Funds Application Standard Operating Procedure

GWOT CoW Status of Funds Report Ready for External Customers

Brown Out Legacy Monthly GWOT CoW Report

Provide GWOT CoW To Be Process Training

Complete Retrograde of Back-Office Functions

Planned Milestone

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Wounded Warrior Pay Management Program

Mission Statement: To improve the accuracy and the timeliness of pay to Wounded Warriors and their families and ensure the critical human dimension of pay support (face-to-face contact and educating the customer) occurs at all critical patient flow locations.

Our Customer

The brave Wounded Warrior, who, without fanfare or desire for personal gain, selflessly places his or her life in grave danger in order to promote freedom and democracy--adhering to American values, executing his or her mission with the business end of a bayonet.

Our Challenge Know the customer – educating and interacting with Warrior and family Ensure visibility and accountability across spectrum of support Enhance customer services by improving policies, procedures, and

systems improvements

Without the customer, we would be without a mission!

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MEDEVAC

LRMC • Face-to-face contact• Stop Combat Zone entitlements• Annotate WIA database

WRAMC• Face-to-face contact• Monitor/stop entitlements• Assist soldier/family in filing travel claim• Assist in filing remission or waiver• Annotate WIA database

TRANSCOM CIC Flight Manifest

Home Station(example: Ft. Hood)

•Face-to-face contact•Monitor/stop entitlements•Assist soldier/family in filing travel claim•Assist in filing remission or waiver•Annotate WIA database

System Feeds• Medical Operational Data System (RC)• Global War on Terrorism• Defense Casualty Processing System

System Feed• Joint Patient Tracking Application

LandstuhlRegional

Med Center

LandstuhlRegional

Med Center

System Feed• Patient Accountability and Real-time Tracking System

Step 1

Step 2

Step 3

Step 4

VA HospitalVA Hospital

WRAMCWRAMC

Family TravelFamily Travel

Permanent Duty Station

Permanent Duty Station

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Prior to the Wounded Warrior Program

Lack of visibility and accountability of a medically evacuated (MEDEVAC) Warrior resulted in: Wounded Warriors with pay problems highlighted by media in late

2004 Reduced command oversight of wounded Soldiers’ duty status Combat-related entitlements not stopped timely

Integrity - Service - Innovation 11

Improvements/Accomplishments since 2005

Improved visibility and accountability with centrally managed database.

Reviewed 67,032 accounts for accuracy of combat-related entitlements.

Placed Wounded Warrior pay teams world-wide to provide face-to-face, world-class fiscal support & stopped appropriate combat entitlements since October 2005.

Established Project Management for Wounded Warrior Pay Management Program. Conduct full scope review of all processes, procedures and

legislation for Wounded Warriors Expanded pay and entitlements education to Wounded

Warriors and family members.

Integrity - Service - Innovation 12

Wounded Warrior Member Debt Management

Reduced instances of new debt for MEDEVAC Warriors since 2005. Remitted $12.6 million of debt for over 13,453 Wounded Warriors:

On July 31, 2007, the Army Human Resources Command approved a mass remission for 5,834 Soldiers totaling $6.8 million. Input will be complete by August 31, 2007.

The mass remission ensures the Wounded Warriors do not endure any financial hardship while on their way to recovery.

Established Project Management for Wounded Warrior Pay Management Program: Conduct full scope review of all processes, procedures and legislation for

Wounded Warriors. Expanded pay and entitlements education to Wounded Warriors and family

members.

Wounded Service member is

Evacuated to Landstuhl

Medical System populates Service member’s data into WW Database

Medical System populates Service member’s data into WW Database

Service member’s pay account is flagged to notify Finance Office of

WW status

Service member’s pay account is flagged to notify Finance Office of

WW status

DFAS/ Army Finance suspends Soldier’s debt

DFAS/ Army Finance suspends Soldier’s debt

Finance Office makes face-to-face contact with Soldier to ensure

accuracy of pay

Finance Office makes face-to-face contact with Soldier to ensure

accuracy of pay

•Responsibility of account management picked up at follow-on Hospital and Finance Office

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Out-of-Country Payments

Out-of-country payments process includes: Proactive steps to ensure internal controls over GWOT provide

reasonable assurance that payments are properly supported and recorded.

Proactive steps include: Modified document verification process to ensure 100%

compliance. Implemented improved checklist. Improved procedures for follow-up with DOs (daily calls, emails,

accelerate timeframes for turnaround). Incorporated measures in balanced scorecard to track compliance

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Applying expertise in a customer environment

Implementing document imagining capabilities for Commands in Kuwait and Iraq and DFAS Rome.

Moving payments when possible from Theater to CONUS.

Establishing a DFAS support cell in Theater: 4 member teams on long-term TDY. Training and assistance in real-time. On-site awareness of challenges and opportunities for improvements.

Updating OUSD(C) Policy governing documentation requirements for payments and accounting for funds and property in a contingency environment.

Providing training on enhanced internal controls for Army finance units in Theater, at Ft. McCoy

(units to deploy this fall) and at Rome.

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Lessons Learned on Audits

Now proactively working audits by: Not only addressing the auditor issues. Looking for other management improvements that can be made to

enhance the operating environment of the area and staff being audited.

Out-of country payments~ Take proactive steps to ensure internal controls over GWOT

provide reasonable assurance that payments are properly supported and recorded.

Steps include: Modified document verification process to ensure 100%

compliance. Implemented improved checklist and improved procedures for

follow-up with DOs (daily calls, emails, accelerate timeframes for turnaround).

Incorporated measures in balanced scorecard to track compliance

Integrity - Service - Innovation 16

Finance & Accounting (F&A) Core Requirements:A Driver for Standardizing DoD Capabilities

Benefit

General LedgerManagement

GuaranteedLoan

SeizedProperty

and ForfeitedAssets

TravelHuman

Resources& Payroll

Non-Financial

BudgetFormulation

Revenue

DirectLoan

Acquisition/FinancialProperty

Management

InventorySupplies and

Materials

GrantFinancial

Insurance

Core Financial

Managerial Cost Accounting

External System InterfacesSystem

Management

PaymentManagement

Budgetary Resource Management

ReceivableManagement

CostManagement

General LedgerManagement

FBWTManagement

System Interfaces

Core Financial System RequirementsOMB OFFM-NO-0106 January 2006 “Core Financial System Requirements”

Framework for Federal Financial Management Systems

OMB OFFM-NO-0106 January 2006 “Core Financial System Requirements”

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ERP Implementation: Functions & Products

Current ERPAssessment

SAPTechnical Support

OracleTechnical Support

ProgressAssessments

Assess level of standardization in current in LMP and BSM

Supply independent advice to corporate and customer teams

Supply independent advice tocorporate and custom teams

Routinely assess systems progress toward standard F&A capabilities

Sp

ecia

lize

d S

up

po

rt

ImpactAssessments

Build “DFAS After…..” proposals,Forecast human capital needs

Architecture &Requirements

StandardInterfaces

StandardTesting

Training & Implementation

AP, AR, SGL, Reporting, Disbursing, Cash Accountability, Intragovernmental

ADS, DDRS, DCAS, BEIS, DTS, IATS, CAPS, WAWF, PowerTrack, Etc.

Scenarios for: core F&A requirements, FFMIA testing, compliance Testing

Standard training doctrine, Standard procedures for core F&A tasks

Sta

nd

ard

C

orp

ora

te S

up

po

rt

UniqueRequirements

UniqueInterfaces

Conversion & Cleansing

UniqueTesting

Training & Implementation

Customer specific requirements

Customer interfaces with legacy systems

Cleansing of customer data

Scnerios for customer specific requirements

Specialized training and procedures for customer requirements

Dir

ect

Cu

sto

me

r S

up

po

rt

Liaison &Project Mgmt.

Coordinate planning and support with customer

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Center of Excellence: Services & Support Concept

FM COE Enterprise Solutions Component Solutions DFAS Solutions Major Functions of Shared Services IG

T

SD

I

BE

IS

BE

IS C

ash

BE

IS R

ptg

(Fin

Rpt

) R

pt)

DIC

HR

S

DT

S

DIM

HR

S

CA

MS

ME

EB

S

LM

P

GF

EB

S

Nav

y E

RP

DE

AM

S

EC

SS

DA

I

EC

Functional Support for Core F&A Capabilities [Requirement Engineering , Functional Test Scripts, Test Performance, Interface Definition, Functional User Training]

AR

AP

Cash Accountability

Disbursing

SGL

Reporting

Pay

Integration & Requirements MGT [Architecture, Integration, & Reqs. Approval]

Architecture & Integration

Requirements Approval

Quantitative Analysis & Technical Support [Costing, Savings, Forecasting, Org Impacts, Assessments, SAP, Oracle]

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FM COE Mission and Goals

Mission

Develop and integrate DoD standard Finance and Accounting business practices

Goals

1. Accelerate System Delivery 2. Reduce Risks Associated with System Delivery3. Standardize Finance and Accounting Practices in DoD 4. Optimize Costs of Providing Finance & Accounting Services5. Improve Financial Management

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Summary

• Continued DFAS focus to provide: More accurate, consistent, and reliable data to

support decision making. More efficient business operations, with cost

savings redeployed to support the warfighter. ● Continued DFAS Strategy and Customer Focus to:

Resolve material weaknesses. Improve financial practices, including appropriate metrics to

better support the warfighter.Strengthen internal controls.Modernize business systems and integrate all processes.

:

Integrity - Service - Innovation 21

Questions