QUARTERLY ACCOUNTS RECEIVABLE REPORT

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QUARTERLY ACCOUNTS RECEIVABLE REPORT
Defense Finance and Accounting Service

• September 11, 2002

2
INTRODUCTION TO QUARTERLY A/R REPORT

• Purpose of Report
• Content
• Features
• Definitions
• DoD Component Collection Responsibilities
• Benefits

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PURPOSE OF REPORT

• For Public and Intragovernmental Receivables
• DFAS Tool for Receivables Management
• In most cases, DFAS is responsible for the debt
  collection and overall management of receivables.
• In all cases, DFAS should be providing status of
  receivables to their Customers.
• Catalyst for Full Disclosure
• Report will identify sources of receivable
  amounts necessary for accurate and complete
  reporting.
• Paints an accurate picture of the state of
  receivables.

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PURPOSE OF REPORT

• For Public and Intragovernmental Receivables
• Identifies Problem Areas
• Exposes process deficiencies when reconciling to
  accounting records
• Discloses collection problems from DoD
  Components, federal agencies and the public
• Highlights delays in debt referral to Debt and
  Claims Offices

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CONTENT OF REPORT

• Report Layout
• Section I - Type of Debt
• An analysis of the accounts receivable by debt
  type and age category for both public and
  intragovernmental
• Ensures timely movement of receivables conforms
  to regulation timelines
• Section II - Debt Status
• An analysis of the debt status for both public
  and intragovernmental
• Discloses receivable amounts within DoD control
• Section III - Analysis Actively Pursuing
  Receivables Greater Than 180 Days
• An analysis of the debts actively being pursued
  to ensure the age of the debts are identified and
  the appropriate actions implemented.

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FEATURES OF REPORT

• Report Checks and Balances
• Report is customized for each Network (including
  Corps of Engineers)
• General Funds and Working Capital Funds are
  automatically consolidated
• into a Service specific tab.
• All Defense organizations are automatically
  consolidated into an Other
• Defense Organization (ODO) tab.
• Control Edits
• Grand Total Type of Debt amount must balance
  with Grand Total Debt
• Status amount.
• A negative amount in Grand Total of Analysis of
  Receivables not Referred
• means more debt has been excluded from
  referral than is eligible for referral.
• A positive amount in Grand Total of Analysis of
  Receivables not Referred
• requires a narrative for analysis. The
  narrative must address
• The reason/s for non-referral
• The required actions
• The time period for resolution

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DEFINITIONS

• Non-Delinquent
• Current Receivables - receivables due within
  next 12 months following
• end of reporting period
• Long Term Receivables - receivables not due
  within 12 months following
• end of reporting period, ex., USACE long-term
  (40 yr) individual water storage
• contracts with local water authorities
• Delinquent Receivables - receivables unpaid for
  more than 30 days from
• date of billing, ex., day 31 equates to day 1 of
  delinquency
• Interest Receivable - is accrued when an amount
  due is not received by the established due date.
  Accounting systems shall be designed to
  accumulate and record such charges for all debts
  owed the U.S. Government.

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DEFINITIONS

• Intragovernmental Receivables - receivables due
  from DoD Components
• or other federal entities
• Within DoD - for example receivables between
  Army to Navy, Air Force to
• Army, Defense Agency/Defense Activity to a
  Service.
• Amounts 2500 and less must be resolved within
  90 days of payment
• due date
• Amounts over 2500 must be resolved within 2
  years after payment due
• date
• Outside DoD - for example receivables between
  DoD and GSA, DoD and
• Dept of Interior, DoD and State Department,
  EPA, DOJ, Dept of Treas., etc.
• All debts regardless of amount must be resolved
  within 2 years.

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DoD Component Collection Responsibilities

• For Contract Vendor Pay Debts
• DoD Component
• Contracting Officer, disbursing officers or other
  designated official performs debt notification
  and collection for first 90 days
• (day 1 - 90).
• DFAS Columbus
• Inputs debt into DFAS Contract Debt System and
  issues final demand letter. (day 91 -120 )
• Searches for offset, adds to list of indebtedness
  and transfers to Treasury. (day 91 - 180)
• Dept. of Treasury
• Treasury pursues collection action including
  referral to Dept of Justice, Credit Bureaus,
  Private Collection Agencies, Dept of Justice and
  Treasury Offset Program. (day 180 - 711)
• Treasury notifies DFAS to write-off uncollected
  debts.

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DoD Component Collection Responsibilities

• For Military, Retired and Civilian Pay
  Out-Of-Service
• DoD Component
• Billing offices (personnel, travel, housing,
  hospital, et.) pursue debts or refers debts to
  payroll system for salary offset while member in
  service and refers uncollected debts to DFAS
  Denver. (day 1 - 90)
• DFAS Denver
• Establishes debt in DFAS Defense Debt Management
  System and
• sends 1 to 3 demand letters. (day 1 - 152)
• Refers debts to credit bureaus and 2 private
  collection agencies under Treasury contract or to
  Depart of Justice. (day 152 - 343)
• Terminate collection action and write-off
  uncollected debts. (day 344 to 711)
• Reactivate debts temporarily to refer to Treasury
  Offset Program for up to 10 years.

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BENEFITS

• Primary Benefits/Focus of Reporting Requirement
• Capturing and reporting all receivables
• Identification of causes/reasons for delays in
  processing/transferring
• debts
• Accountability of organizations/activities
  responsible for resolution
• Implement timely process/procedural/system fixes
• Other Benefits
• Efficient management of receivables in the
  Department of Defense
• Accurate and traceable data from the financial
  statements to Field level
• records