BY ORDER OF THE SECRETARY OF THE AIR FORCE AIR FORCE INSTRUCTION 65-607 17 FEBRUARY 2011 Financial Management FOREIGN MILITARY SALES DEDICATED TRAINING PROGRAM COMPLIANCE WITH THIS PUBLICATION IS MANDATORY ACCESSIBILITY: Publications and forms are available on the e-publishing website www.epublishing.af.mil for downloading or ordering RELEASABILITY: There are no releasability restrictions on this publication. OPR: SAF/FMBMS Supersedes: AFI65-607, 1 May 1997 Certified by: SAF/FMBM (Ms. Judith B. Oliva) Pages: 5 This Instruction implements AFPD 65-6, Budget and DoD 7000.14-R, Department of Defense Financial Management Regulation (DoDFMR). It acquaints the financial community with legislative provisions and policies associated with the management of the FMS Dedicated Training Program and provides related guidance. It is applicable to all Major Commands (MAJCOMs) and Air National Guard (ANG) units managing Foreign Military Sales (FMS) Dedicated Training Programs. Ensure that all records created as a result of processes prescribed in this publication are maintained in accordance with Air Force Manual (AFMAN) 33-363, Management of Records, and disposed of in accordance with Air Force Records Information Management System (AFRIMS) Records Disposition Schedule (RDS) located at https://www.my.af.mil/afrims/afrims/afrims/rims.cfm. Refer recommended changes and questions about this publication to the Office of Primary Responsibility (OPR) using the AF Form 847, Recommendation for Change of Publication; route AF Form 847s from the field through the appropriate functional s chain of command. SUMMARY OF CHANGES This document has been substantially revised and must be completely reviewed. Major changes include the inclusion of Decision of the Comptroller General, Volume 58, page 81, DCG File B- 165731, November 16, 1978 ruling that FMS Trust Funds are considered appropriated funds necessitating FMS case execution in accordance with United States (US) and DoD regulations and procedures. Paragraph 2 is added to identify related guidance for applicability and paragraph 3 redefines roles and responsibilities. 1. Overview. An FMS Dedicated Training Program assigns or allocates specific resources and services for training and use by non-us personnel, e.g. an international flying training squadron.
2 AFI65-607 17 FEBRUARY 2011 It does not include FMS training programs for which a tuition rate is established based on cost per student. Dedicated training programs may involve one or more nations who share the resources and services of which the US may or may not be a participating nation. Training is not traditionally provided to US personnel unless they will be providing instruction or other services to the non-us personnel within the program (i.e. joint, cooperative, etc.). 2. Related Guidance. DoD policy, in fulfilling the Arms Export Control Act (AECA), Public Law 90-629, as amended, codified at 22 United States Code (U.S.C.) 2751 et seq., and the Foreign Assistance Act (FAA), Public Law 87-195, as amended, codified at 22 U.S.C. 2151 et seq., and other legal authority requirements, dictates that Security Cooperation activities be planned, programmed, budgeted and executed with the same high degree of attention and efficiency as other integral DoD activities, combined with other DoD requirements and implemented through standard DoD systems, facilities and procedures. According to 58 Comptroller General Decision 81 (1978), FMS Trust Funds deposited in the Treasury are considered appropriated funds even though they are not annually appropriated by Congress. For related financial management guidance and procedures see AFI 65-601, Volume 1, Budget Guidance and Procedures, DoDFMR Volume 3, Chapter 8, Recording Commitments and Obligations, AFI 65-608, Antideficiency Act Violations and Defense Finance and Accounting Service, Columbus, (DFAS-DE) regulations. 3. Roles and Responsibilities. 3.1. SAF/FMBMS is the Office of Primary Responsibility (OPR) for all financial issues concerning the FMS Dedicated Training Program. As such it shall: 3.1.1. Establish and update FMS financial guidance and procedures for implementation and financial management of dedicated training programs to ensure consistency and adherence to statutes, regulations, international agreements and other authorities. 3.1.2. Provide guidance and instruction for resolving financial issues. 3.1.3. Review and approve command and field financial management guidance and procedures prior to implementation. 3.1.4. Review and approve the following financial documents for evaluating cost allocations and methodology used to price direct and indirect costs. Documentation and approval memo will be provided to the Implementing Agency and/or case manager. 3.1.4.1. Pre-LOR/LOA (Letter of Request/Letter of Offer and Acceptance): Price & Availability (P&A) and Letter of Offer and Acceptance Data (LOAD). 3.1.4.2. Amendments/modifications and justifications to the implemented LOA. 3.1.4.3. LOAD for follow-on case development. 3.1.4.4. Selected annual billings. 3.1.5. Provide current cost and planning factors. 3.1.6. Conduct periodic site visits and perform financial reviews to assist with the Dedicated Training Program. 3.1.7. Provide training related to the Dedicated Training Program as required. 3.2. MAJCOMs and ANG units shall:
AFI65-607 17 FEBRUARY 2011 3 3.2.1. Establish and maintain systems and procedures for gathering, reporting and submitting program costs and related data. 3.2.2. Assist organizations within their command to identify, develop and report financial data related to dedicated training program activities. 3.2.3. Request evaluation and approval from SAF/FMBMS, prior to using any unique cost factors, cost estimating relationships, procedures or methods related to the dedicated training mission. 3.2.4. Furnish a copy of command and field financial management guidelines for dedicated training programs to SAF/FMBMS for evaluation and approval prior to implementation. 3.2.5. Communicate and coordinate financial, logistical, and other pertinent information to your respective Case and Program Managers as required by DoD 5105.38-M, Security Assistance Management Manual (SAMM) and AFMAN 16-101, International Affairs and Security Assistant Management to ensure effective case management. 3.2.6. Direct financial or line managers to review and reconcile expenditures periodically, at least quarterly, with DFAS to compare and ensure all deliveries are reported and billed to the appropriate country case and lines. 3.2.7. Obtain actual costs and prepare reimbursement documents for monthly billing as required by DoDFMR Volumes 11A and 15, Chapters 1 and 2 respectively. 3.2.8. Establish points of contact for financial management of each dedicated training program and provide name, rank, office symbol and telephone number to SAF/FMBMS. 3.2.9. Prepare and submit the following financial documents to SAF/FMBMS for review and approval. Data should reflect estimated direct and indirect costs, methodology used to determine cost and sources of information, e.g., OUSD(C) Memorandum for FY10, AFI 65-503, Cost Factors, Table 26-1, etc. 3.2.9.1. Pre-LOR/LOA: P&A and LOAD. Spreadsheets should include: 3.2.9.1.1. Case Identifier information: BN-D-XXX, Line XXX 3.2.9.1.2. Period of Performance (PoP) for the data: FYXX-XX. 3.2.9.1.3. Description of priced elements: payroll, munitions, fuel, etc. 3.2.9.1.4. Estimated cost by fiscal year. 3.2.9.2. Amendments/modifications and justification to the implemented LOA. 3.2.9.3. LOAD for follow-on case development. 3.2.9.4. Annual billings selected for review. 4. Records management. Maintain FMS case files in accordance with DoDFMR, Volume 15, Chapter 6, Case Files. Case Managers must ensure accessibility to retired files, source documents, invoices, bills of lading, other proof of shipments and other applicable documents that provide the audit trail to account for United States Government (USG) and purchaser funds. Retention period is 10 years after the date of case closure, although some exceptions apply.
4 AFI65-607 17 FEBRUARY 2011 Dispose of reporting forms and financial records as prescribed by AFI 33-364, Records Disposition--Procedures and Responsibilities. 5. Adopted Form. AF Form 847, Recommendation for Change of Publication. JAMIE M. MORIN Assistant Secretary of the Air Force (Financial Management and Comptroller)
AFI65-607 17 FEBRUARY 2011 5 References ATTACHMENT 1 GLOSSARY OF REFERENCES AND SUPPORTING INFORMATION AFI 33-364, Records Disposition--Procedures and Responsibilities, Dec 22, 2006 AFI 65-503, US Air Force Cost and Planning Factors, Feb 4, 1994 AFI 65-601, Volume 1, Budget Guidance and Procedures, March 3, 2005 AFI 65-608, Antideficiency Act Violations, March 18, 2005 AFMAN 16-101, International Affairs and Security Assistant Management, Jun 20, 2003 AFMAN 33-363, Management of Records, March 1, 2008 AFPD 65-6, Budget, May 1, 1998 DoD 5105.38-M, Security Assistance Management Manual (SAMM), Oct 3, 2003 DoD 7000.14-R, Department of Defense Financial Management Regulation DoDD 5132.03, DoD Policy and Responsibilities Relating to Security Cooperation, Oct 24, 2008 Title 22, U.S.C., Section 2751et seq., Arms Export Control Title 22, U.S.C., Section 2151et seq., Foreign Assistance 58 Comp. Gen. 81 (B165731), ruling that FMS Trust Funds deposited in Treasury are considered appropriated funds Abbreviations and Acronyms BOS Base Operating Support DoDFMR Department of Defense Financial Management Regulation DFAS Defense Finance and Accounting Service FOA Field Operating Agency FMS Foreign Military Sales IA Implementing Agency LOA Letter of Offer and Acceptance LOAD Letter of Offer and Acceptance Data MAJCOM Major Command OPR Office of Primary Responsibility OUSD(C) Office of the Under Secretary of Defense (Comptroller) PoP Period of Performance P&A Pricing & Availability