(FMS) Customer Financial Management Handbook (Billing)

208 Pages·2010·3.13 MB·English

by  Patti Vocke

Foreign Military Sales Customer Financial
Management Handbook (Billing)
Jointly Developed by
Defense Institute of Security Defense Finance and
Assistance Management Accounting Service
Tenth Edition
Library of Congress
Catalog Card No. 96-71924
FMS Red Book August 2010
FMS Red Book August 2010 2
Acknowledgements
Defense Institute of Security Defense Finance and Accounting
Assistance Management Service Directorate,
For Security Assistance
Dr. Ronald H. Reynolds Alfred S. Graham
Commandant Director
Authors and Contributors
Chris M. Krolikowski, DISAM
2475 K Street
Wright-Patterson Air Force Base, Ohio 45433
Phone Commercial [phone]
DSN 785-5850
Commercial Fax [phone]
DSN 986-4685

DFAS-Indianapolis (DFAS-IN/JAXBC)
8899 East 56th Street
Indianapolis, Indiana 46249
Phone Commercial [phone]
DSN 699-7208
Commercial Fax [phone]
DSN 699-7278
Editorial Assistant
Patricia Vocke, DISAM
Graphics
Danny Palmer, DISAM
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PREFACE
The Foreign Military Sales (FMS) Customer Financial Management Handbook (Billing) is
intended to provide an explanation of the fi nancial aspects of the U.S. foreign military sales program,
with emphasis on Foreign Military Sales billing and reporting. This publication describes “how”
the Foreign Military Sales fi nancial system works and, in many instances, delineates “why” this
fi nancial system is designed to function as it does. While the U.S. Department of Defense (DoD) is
always receptive to suggestions to improve Foreign Military Sales fi nancial procedures, readers of
this publication should observe that many such procedures are followed because of legal requirements
contained in U.S. Public Law. As a result, DoD very often has little fl exibility in the fi nancial
administration of the Foreign Military Sales Program. This publication does not take precedence
over offi cially published U.S. government directives, instructions, or manuals and is intended as a
guide only. Additionally, this publication goes to press in a time of dynamic changes in the security
assistance arena. Some changes may even occur while this handbook is being printed.
Any requests for clarifi cation or suggestions for improvement or content should be addressed to
the following:
Defense Finance and Accounting Service (DFAS-IN/JAXBC)
East 56th Street
Indianapolis, Indiana 46249-8901
Telephone - DSN 699-7208
Telephone Commercial - [phone]
Fax - DSN 699-7278
Fax Commercial - [phone]
Or
The Defense Institute of Security Assistance Management (DISAM/DR)
2475 K Street, Building 52
Wright-Patterson AFB, Ohio 45433-7641
Telephone - DSN 785-5850
Telephone Commercial - [phone]
Data Fax - DSN 785-4685
Data Fax Commercial - [phone]
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Table of Contents
Page
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .v
Part I – General Overview
1. An Introduction to the Foreign Military Sales Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1-1
2. Foreign Military Sales: Organizations and Processes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2-1
3. Foreign Military Sales: Offer and Acceptance Documentation . . . . . . . . . . . . . . . . . . . . . . .3-1
4. The Foreign Military Sales Billing System. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4-1
5. DFAS-IN Customer Assistance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5-1
PART II -- Foreign Military Sales Billing Documents
6. The Foreign Military Sales Billing Statement (DD Form 645). . . . . . . . . . . . . . . . . . . . . . . . . .6-1
7. Foreign Military Sales Delivery Listing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7-1
8. Foreign Military Sales Financial Forecast . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8-1
9. Foreign Military Sales Reply Listing to Customer Requests for Adjustments. . . . . . . . . . . .9-1
10. Holding Accounts Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10-1
11. Accelerated Case Closure Suspense Account Statement . . . . . . . . . . . . . . . . . . . . . . . . . .11-1
PART III – APPENDICES
A. Foreign Military Sales Delivery Listing Document Identifiers and Headings. . . . . . . . . . . . .A-1
B. Generic Surcharge Table. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B-1
C. Routing Identifier Codes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .C-1
D. Price Codes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D-1
E. Foreign Military Sales MILSTRIP Document Number (Construction of). . . . . . . . . . . . . . . . .E-1
F. Implementing Agency Codes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F-1
G. Delivery Term Codes and Related Charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G-1
H. Type of Assistance Codes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .H-1
I. Julian Date Calendar. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1
J. Unit of Issue Abbreviations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .J-1
K. Offer/Release Codes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .K-1
L. Mode of Shipment Codes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .L-1
M. Adjustment Reply Codes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . M-1
N. Transportation Bill Codes and Related Charges. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N-1
O. Delivery Source Codes and Accessorial Computation Matrix . . . . . . . . . . . . . . . . . . . . . . . .O-1
P. Abbreviations and Acronyms (Part 1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .P-1
Glossary of Selected Terms (Part 2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .P-13
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Part I
General Overview
“The next best thing to knowing something
is knowing where to fi nd it.”
Samuel Johnson
1-1
1-2