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GFEBS

By CrystalAllen Oct 14, 2014 2950 Words
Audit Readiness
Audit Support Handbook
Reimbursable - Inbound

Office of the Assistant Secretary of the Army
(Financial Management & Comptroller)
Army Accountability & Audit Readiness Directorate

September 2014
Accountability & Audit Readiness:
Sustaining Army’s Strength

Audit Support Handbook – Reimbursable Inbound

Table of Contents
1
2
3
4

Background ............................................................................................................................. 2 Introduction ............................................................................................................................. 3 Responding to PBC Requests ................................................................................................. 4 Reimbursable Inbound – Control Description & Key Supporting Documents ...................... 5 4.1 SBR 18.01 – Reimbursable Agreement Budget Analyst Review .................................... 5 4.2 SBR 18.02 – Revenue Recognized to Cost Incurred Reconciliation ............................... 9 4.3 SBR 18.03 – Sales Order Review/Reconciliation ............................................................ 0 5

Appendices .............................................................................................................................. 4 5.1 Appendix A – Preparing For Testing – Provided By Client (PBC) Requests.................. 4 5.2 Appendix B – Personally Identifiable Information .......................................................... 6 5.3 Appendix C – Commitment Items ................................................................................... 7 5.4 Appendix D – Acronym List ............................................................................................ 8

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1 Background
The Office of the Under Secretary of Defense (Comptroller) (OUSD(C)) outlined the Department of Defense (DoD) priorities for improving financial information and achieving financial statement audit readiness. The 11 August 2009 OUSD(C) memorandum directs the DoD Components to improve budgetary information, as this is the information most useful to the Department's decision makers. Specifically, DoD Components should focus on improving budgetary processes and information to obtain an unqualified audit opinion on the Statement of Budgetary Resources (SBR).

The National Defense Authorization Act (NDAA) for FY 2010 (Public Law 111-84), signed into law 28 October 2009, reiterates the OUSD(C) priorities to improve the accuracy and reliability of budgetary information. To achieve these goals, the Under Secretary of the Army issued a memorandum on 10 March 2010 directing the Office of the Assistant Secretary of the Army (Financial Management & Comptroller) (OASA(FM&C)) to develop a plan to address the OUSD(C) audit readiness priorities. These directives serve as the basis for Army’s budget process discovery effort.

In support of the directives issued by OUSD(C), the NDAA FY 2010, and the Under Secretary of the Army, in June 2010 OASA(FM&C) developed the Army SBR Audit Approach. This approach focuses on sites to which the Army has deployed the General Fund Enterprise Business System (GFEBS). This GFEBS-based SBR strategy focuses on a risk based approach to audit readiness followed by Independent Public Accountant (IPA) examinations of the controls and financial transactions within each Army process identified. This document narrates one of those processes and identifies the potential risks of improper accounting and reporting of transactions within this process and controls that mitigate the possible negative impact on the SBR.

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2 Introduction
This document has been prepared by the OASA(FM&C) SBR team in reference to the Army Financial Improvement Plan. The intent of this document is to provide a guide for supporting documentation that satisfies the requirements of each attribute for key controls within identified business processes in the GFEBS environment. The business process identified in this handbook is Inbound Reimbursable Agreements.

An inbound reimbursable agreement is any written agreement whereby the performer agrees to provide goods or services to the requestor, in return for reimbursement of costs incurred. In this document, the performer is defined as the Army Activity supplying the goods or services. The requestor is defined as the department, agency or commercial entity requisitioning the goods or services.

The supporting documentation was obtained from installation site visits during OASA(FM&C) discovery and testing efforts from FY 2010 to FY 2013 as well as additional resources when needed.
The document is organized by SBR key internal control. This Handbook will assist the Army in generating a clean financial audit from an IPA and serve as a mechanism of financial stewardship throughout the Army Financial Management community.

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3 Responding to PBC Requests
In support of Army audit readiness efforts, all commands are required to provide supporting documentation of GFEBS-based transactions for testing, examination, or audit efforts. Commands should reference the Audit Support Handbook (ASH), Provided By Client (PBC) lists, process narratives, SOPs and other documents as needed to meet any transaction-related documentation requirements (on Army Knowledge Online at

https://www.us.army.mil/suite/files/33331630). However, due to the numerous types of transactions and number of systems that interface with GFEBS, commands should recognize the ASH, PBC lists, and other resources cannot cover every transactional scenario. In the event a command feels that additional documentation would support the transaction or feels the PBC list does not properly reflect the business event or control activity behind the given transaction, all other documentation should be provided to OASA(FM&C). When deviating from the PBC list, ASH, etc., commands should write a memorandum for record (signed by Internal Review staff or delegated individual) explaining the logic behind any deviations as well as how the additional documentation supports the business event or control activity.

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4 Reimbursable Inbound – Control Description & Key Supporting Documents
This section describes each control activity, the control objective, key supporting documents that are used when performing the control, and items that will be requested during audit readiness testing as evidential matter supporting control performance.

4.1

SBR 18.01 – Reimbursable Agreement Budget Analyst Review

Control Activity: A designated individual reviews the reimbursable agreement (e.g., Department of Defense (DD) Form 448, Interservice Support Agreement, Memorandum of Understanding, Memorandum of Agreement, 285-R) to ensure the following: •

Goods/services listed on the agreement are within the scope of the Army activity's mission.



The Army activity has the authority and capacity to perform the work.



The Army activity Performer can begin the work before the Requestor’s funds expire.

This review and approval is evidenced by the designated individual's signature and date on the reimbursable agreement acceptance.
Purpose of Control: This control confirms that the goods and services requested align with the Army Activity’s function and authority and that the funding provided by the Requestor is available to be executed against. This mitigates the risk that the Army Activity will approve a reimbursable agreement that they do not have the capacity or authority to perform. It also mitigates the risk that work will be performed that the Requestor will be unable to provide reimbursement for.

How to Perform the Control: Prior to any work being performed and the sales order being created in GFEBS, a reimbursable agreement must be received from the requesting entity. The reimbursable agreement is reviewed to determine if it contains the following data elements: goods/services requested, agreement amount, billing terms, period of performance, funds expiration date, and the line of accounting (LOA). After confirming its contents, the Army Activity determines whether the requested goods/services listed on the agreement are within the scope of the Activity’s mission, that the Activity has the authority and capacity to perform the work, and that the Activity can begin the work before the requesting entity’s funds expire. If the criteria are met, the reimbursable agreement is accepted. The acceptance is evidenced by a signature and date on the reimbursable acceptance agreement. The Sales Order in GFEBS should be created after the reimbursable acceptance agreement has been signed. In addition, the Sales Order number and Work Breakdown Structure (WBS) should be written on the reimbursable acceptance agreement.

Example of Performing the Control: The example uses a Military Interdepartmental Purchase Request (MIPR) and a DD Form 448-2, Acceptance of MIPR.

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Audit Support Handbook – Reimbursable Inbound
Note: The red boxes in the screenshot identify key areas of the supporting documentation that must be reviewed when performing the control.
When the reimbursable agreement is received from the Requesting Entity, the Army Activity reviews the MIPR for the following: goods/services requested, agreement amount, billing terms, period of performance, funds expiration date, and LOA. The Army Activity then signs and dates the MIPR Acceptance Form.

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Another example of how to perform this control uses the Request for Support/Agreement Direct Charge (DRCH) WBS developed by FORSCOM G8. This Command created document is used to provide funding for direct charge inbound reimbursables. The reimbursable agreement is signed and dated by both the Requestor and Acceptor/Performer. Request for Support/Agreement

Direct Charge Work Break Down Structure (DRCH WBS)
Performer:
Requestor:

United States Army Aviation Center of Excellence (USAACE), Directorate of Resource Management (DRM), Fort Rucker, AL 36362

Requestor's Information
Fund
Fund Center
Functional Area
Cost Center
POC
Phone Number
Email Address
FAX Number
Funded Amount:
Base or Change:
Direct Charge WBS (created by performing activity):
Performer's Information
Cost Center
POC
Phone Number
Email Address
The above DRCH WBS is issued and funded to provide funding for Reimbursable FXXXI. Commitments/obligations will not exceed the amount stated above without approval from the requestor's POC or a designated individual from the Fort Rucker DRM.

All funds pertaining to this accounting line will expire 30 September 2013. Request that all required funds be fully obligated or returned by 1 September 2013.
Thank you for your support and assistance. Please create the WBS, complete the performer's information, sign below to indicate acceptance of these funds with the terms stated above, and fax or email back to the above listed POC.

Signature of Requestor

Date

Signature of Acceptor

Date

Courtesy of FORSCOM G 8

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4.2

SBR 18.02 – Revenue Recognized to Cost Incurred Reconciliation

Control Activity: A designated individual performs a monthly reconciliation of revenue recognized to the cost incurred to ensure that costs are complete and revenue is recognized appropriately. Exceptions are investigated and resolved prior to the following month-end close and evidenced by the designated individual's signature and date on the reconciliation worksheet. Purpose of Control: This control mitigates the risk that funds will be received from the Requestor in excess of the actual costs incurred by the Army Activity to perform the reimbursable work.

How to Perform the Control: At this time, the data required to perform the control is either unavailable or is not available in the necessary format needed to execute the control.

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4.3

SBR 18.03 – Sales Order Review/Reconciliation

Control Activity: A designated individual, other than the person who creates the Sales Order (With or Without Advance) reviews and reconciles the Sales Order (With or Without Advance) in GFEBS to the reimbursable agreement and reimbursable agreement acceptance to ensure that the data entered in the system is complete and accurate. Exceptions are investigated and resolved prior to the following month-end close. This review is evidenced by the signature and date of the reviewer on the reimbursable agreement acceptance.

Purpose of Control: This control confirms that the data entered on the Sales Order in GFEBS matches the reimbursable agreement and acceptance and is complete and accurate. How to Perform the Control: The reimbursable agreement is reconciled against the Sales Order in GFEBS to determine if the following data elements match: goods/services requested, agreement amount, billing terms, period of performance, funds expiration date, and the line of accounting (LOA). The GFEBS Sales Order (With or Without Advance) must be created after the reimbursable acceptance agreement has been signed. In addition, the GFEBS Sales Order number and Work Breakdown Structure (WBS) should be written on the reimbursable acceptance agreement. All differences are documented and resolved prior to the following month-end close. This review is evidenced by the signature and date of the reviewer on the reimbursable agreement acceptance or the Sales Order screenshot. Note: The reviewer should not sign and date the DD Form 448-2, Acceptance of MIPR, in fields 16 and 17.

Example of Performing the Control: The example uses a Military Interdepartmental Purchase Request (MIPR), a DD Form 448-2 (Acceptance of MIPR), and a GFEBS Sales Order (Without Advance) for the reconciliation.

Note: The red boxes in the screenshot identify key areas of the supporting documentation that must be reviewed when performing the control.
The reimbursable agreement and the GFEBS Sales Order (With or Without Advance) are reconciled to ensure the following match: goods/services requested, agreement amount, billing terms, period of performance, funds expiration date, and LOA. The second reviewer then signs and dates the MIPR Acceptance Form (DD FORM 448-2).

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The second reviewer must
sign the DD FORM 448-2
(may sign anywhere except
Box 16 or 17) or Sales Order
screenshot.

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The GFEBS Sales Order (With or Without Advance) must be reconciled against the reimbursable agreement and reimbursable agreement acceptance to ensure that the data entered in the system is complete and accurate.

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5 Appendices
5.1 Appendix A – Preparing For Testing – Provided By Client (PBC) Requests There are a variety of supporting documents that must be retained as evidence that the control was performed. To support audit testing, these supporting documents will be requested by OASA(FM&C) from Army personnel using a PBC request. All items included on the PBC request must be submitted to OASA(FM&C). Below is a list of PBC items that will be requested and some examples of supporting documents. The examples provided are the most commonly used documents to evidence the control, but the list is not all inclusive of every document that can be used. Refer to DoD and Army guidance for the most current documentation.

SBR Control Supporting Documentation

18.01

a. Reimbursable Agreement and amendments, if applicable
(e.g., DD Form 448, ISSA, MOU, MOA) with evidence of
acceptance
b. GFEBS Sales Order screenshot that shows net value/total
amount (Must demonstrate the connection between the MIPR
and the recorded Sales Order)
c. GFEBS Sales Order screenshot that shows the WBS number
and WBS funding information for the Sales Order - Account
Assignment Tab
d. GFEBS Sales Order screenshot that shows the Customer's
funding information
e. Federal Transaction Register Screenshot showing postings
for budgetary accounts
*use the Commitment String from the GFEBS sample data to
pull this item; if the Commitment String data is not listed in the PBC, use the Ref Document number
*within the FTR screen, scroll to the appropriate transaction amount/line that corresponds to the sample item requested

18.02

Note: At this time, the data required to perform the control is either unavailable or is not available in the necessary format needed to execute the control.

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18.03

a. Reimbursable Agreement (e.g., DD Form 448, ISSA, MOU,
MOA) with evidence of acceptance
b. GFEBS Sales Order screenshot that shows posting date and
amounts
c. GFEBS Sales Order screenshot that shows the name/EDIPI
of the Sales Order creator

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5.2 Appendix B – Personally Identifiable Information
OASA(FM&C) considers the privacy of personally identifiable information (PII) as a top priority at all levels of audit readiness. Every effort should be made to protect that information in both hardcopy and electronic formats. The installation Command level is the first line of defense to ensure that this information remains private. Please ensure that PII is removed from all documentation unless otherwise requested. Common methods to fully remove PII include: 1) Copy the original, blackout the PII, copy/scan redacted documents, and shred the copy 2) Copy original, whiteout the PII, copy/scan, and shred the copy 3) Scan original documents and use software such as Adobe Professional or Nuance PDF Converter Enterprise to redact PII from original documents

In summary, the Office of Management and Budget describes PII as “Information which can be used to distinguish or trace an individual's identity, such as their name, social security number, biometric records, etc. alone, or when combined with other personal or identifying information which is linked or linkable to a specific individual, such as date and place of birth, mother’s maiden name, etc.”

Some common examples of PII include:









Mother’s maiden name
Social Security number (remove ENTIRE number)
Birthday
Birthplace
Credit card number (except last 4 digits)
Any information related to family members
Personal telephone numbers
Home address

The examples above are only meant as a guide and are in no way considered to be an exhaustive list of possible PII attributes. If in doubt, always redact information so that it is not identifiable.

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5.3 Appendix C – Commitment Items
Commitment items only pertain to expense transactions; therefore, Reimbursable Inbound revenue transactions do not contain commitment items.

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5.4 Appendix D – Acronym List

ASH
DD
DoD
DRCH
GFEBS
IPA
ISSA
LOA
MIPR
MOA
MOU
NDAA
OASA(FM&C)
OUSD(C)
PBC
PII
SBR
WBS

List of Acronyms / Abbreviations
Audit Support Handbook
Department of Defense
Department of Defense
Direct Charge
General Fund Enterprise Business System
Independent Public Accountant
Inter Service Support Agreement
Line of Accounting
Military Inter-departmental Purchase Request
Memorandum of Agreement
Memorandum of Understanding
National Defense Authorization Act
Office of the Assistant Secretary of the Army (Financial Management & Comptroller)
Office of the Under Secretary of Defense (Comptroller)
Provided by Client
Personally Identifiably Information
Statement of Budgetary Resources
Work Breakdown Structure

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