DODFMR Vol. 11B - Getting Paid Back (By Us)

Department of Defense Financial Management Regulation (DoD FMR) Volume 11B, titled “Reimbursable Operations Policy - Working Capital Funds (WCF),” establishes the comprehensive financial management, accounting, and budgetary framework for all Defense Working Capital Fund (DWCF) activities. The volume details the lifecycle of DWCF entities, prescribing the strict criteria and chartering processes required for their establishment, as well as the procedures for transferring functions or closing activities, including the handling of Base Realignment and Closure (BRAC) impacts. It dictates that DWCFs are initially capitalized through appropriations or transfers but are designed to be self-sustaining by fulfilling reimbursable customer orders, operating on a break-even basis by utilizing stabilized rates and prices. Furthermore, the regulation mandates rigorous managerial cost accounting standards—such as specific job order costing procedures for depot maintenance—to accurately capture direct, indirect, and general and administrative (G&A) costs, including the treatment of military personnel expenses and depreciation. Volume 11B also governs the strict rules for revenue recognition and timely billing based on the percentage of completion or delivery, while providing specialized financial guidance for Supply Management Activities regarding inventory pricing and contract authority. Finally, it explicitly separates Mobilization Costs (such as maintaining surge capacity and war reserve materiel), requiring that these contingency readiness capabilities be funded by direct appropriations rather than being passed on to regular DWCF customers