Edward Geoffrey Keating - Defense working capital fund pricing policies: insights from the Defense Finance and Accounting Service
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Defense working capital fund pricing policies: insights from the Defense Finance and Accounting Service
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The Defense Finance and Accounting Service (DFAS), created in 1991 through the consolidation of military service-specific accounting and finance operations, provides a variety of services to Department of Defense (DoD) customers, such as payroll, bill payment, and generation of accounting statements. Examining DFAS data on expenditures and workload to explore possibilities for improved operations, the authors argue that current linear pricing of DFAS services is inappropriate. In particular, DFAS expenditures neither increase nor decrease commensurate with workload. DFASs pricing could be improved by a switch to a nonlinear approach, distributing fixed costs among customers using open-the-door transfer payments and charging only incremental costs to customers on a per work unit basis. Such a pricing reform would require changes to current Defense Working Capital Fund (DWCF) regulations.
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Defense Working Capital Fund Pricing Policies : Insights From the Defense Finance and Accounting Service
author
:
Keating, Edward G.; Gates, Susan M.
publisher
:
RAND
isbn10 | asin
:
083302745X
print isbn13
:
9780833027450
ebook isbn13
:
9780585239590
language
:
English
subject
United States.--Defense Finance and Accounting Service, United States--Armed Forces--Appropriations and expenditures.
publication date
:
1999
lcc
:
UA23.K3846 1999eb
ddc
:
355.6/212/0973
subject
:
United States.--Defense Finance and Accounting Service, United States--Armed Forces--Appropriations and expenditures.
The research described in this report was sponsored by the Defense Finance and Accounting Service. The research was conducted in RAND's National Defense Research Institute, a federally funded research and development center supported by the Office of the Secretary of Defense (OSD), the Joint Staff, the unified commands, and the defense agencies under contract DASW01-95-C-0059.
Library of Congress Cataloging-in-Publication Data
Keating, Edward G. (Edward Geoffrey), 1965 - . Defense working capital fund pricing policies : insights from the Defense Finance and Accounting Service / Edward G. Keating, Susan M. Gates. p. cm. "Prepared for the Defense Finance and Accounting Service by RAND's National Security Research Division." "MR-1066-DFAS." Includes bibliographical references (p. ). ISBN 0-8330-2745-X 1. United States. Defense Finance and Accounting Service. 2. United StatesArmed ForcesAppropriations and expenditures. I. Gates, Susan M., 1968 - . II. Title. UA23.K3846 1999 355.6 ' 212 ' 0973dc21 99-30360 CIP
RAND is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND is a registered trademark. RAND's publications do not necessarily reflect the opinions or policies of its research sponsors.
Copyright 1999 RAND
All rights reserved. No part of this book may be reproduced in any form by any electronic or mechanical means (including photocopying, recording, or information storage and retrieval) without permission in writing from RAND.
Published 1999 by RAND 1700 Main Street, P.O. Box 2138, Santa Monica, CA 90407-2138 1333 H St., N.W., Washington, D.C. 20005-4707 RAND URL: http://www.rand.org/
To order RAND documents or to obtain additional information, contact Distribution Services: Telephone: (310) 451-7002; Internet: order@rand.org
Page i
Defense Working Capital Fund Pricing Policies
Insights from the Defense Finance and Accounting Service
Edward G. Keating, Susan M. Gates
Prepared for the Defense Finance and Accounting Service
Approved for public release; distribution unlimited
Page iii
Preface
The Defense Finance and Accounting Service (DFAS) is a defense agency created in 1991 to provide finance and accounting services (e.g., personnel and contract payments, trial balances, travel voucher handling) for the Department of Defense (DoD). DFAS agglomerated what had been service-specific facilities and personnel providing such services. DFAS is also a Defense Working Capital Fund (DWCF) activity, which recovers its operating costs through customer fees.
The DFAS asked RAND to examine historical trends and patterns in DFAS's performance. The goal is to help DFAS leadership identify possible approaches to improve performance. This report integrates and summarizes RAND's Fiscal Year (FY) 1998 research for DFAS and presents pricing policy implications that may be applicable to other DoD and governmental entities.
This research was conducted in the Forces and Resources Policy Center of RAND's National Defense Research Institute, a federally funded research and development center sponsored by the Office of the Secretary of Defense, the Joint Staff, the unified commands, and the defense agencies. This report will be of interest to DoD policymakers and researchers interested in infrastructure and intra-DoD pricing policies.
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