CDFM Module 3 flashcards

32 cards. Read the term and the definition here. The deck at the top of this page is optional.

PPBE Planning phase

The first PPBE phase, in which senior leadership issues strategic and fiscal guidance that establishes priorities, resource constraints, and assumptions for the programming phase.

Program Objective Memorandum

The programming-phase document in which a military department proposes a balanced six-year program of resources to satisfy guidance; it is reviewed and reconciled during program review.

Color of money

The appropriation category that funds a given expense, such as procurement, RDT&E, O&M, or military personnel. Misuse of the wrong color violates appropriations law.

Bona fide need rule

Requirement that appropriated funds obligate only for needs arising in the period of availability, preventing agencies from stockpiling or pre-funding future-year requirements with current funds.

Anti-Deficiency Act

Federal law prohibiting obligations or expenditures in excess of available appropriations, obligations before funds are available, and acceptance of voluntary services. Violations must be reported to Congress.

Full funding policy

Budgeting principle requiring the total acquisition cost of an end item to be funded in the year it is procured, rather than incrementally over several years.

Obligation vs outlay

An obligation is a definite legal commitment that creates a liability; an outlay is the actual disbursement of cash to liquidate the obligation.

Period of availability

The time during which appropriated funds may be obligated, such as one year for O&M, three for procurement, and five for military construction.

Expired funds

Funds whose period of availability has ended. They remain on the books only to adjust existing obligations upward or to record certain authorized expenses, but cannot fund new obligations.

Full-Time Equivalent

A manpower measure converting total paid work hours to positions, computed as total hours divided by the standard annual hours of 2,080 per position.

Parametric cost estimate

An estimating method using statistical relationships, called cost-estimating relationships, between cost and physical or performance characteristics such as weight, speed, or complexity.

Learning curve formula

Y = aX^b, where Y is unit cost, a is first-unit cost, X is cumulative quantity, and b equals log(learning rate) divided by log 2.

Then-year vs constant-year dollars

Then-year dollars include inflation and reflect prices paid in the year of expenditure; constant-year dollars remove inflation so amounts are comparable across years.

Sunk cost

A cost already incurred that cannot be recovered or changed by a decision. Sunk costs are excluded from incremental decision analysis.

Opportunity cost

The value of the best alternative forgone when a resource is committed to one use rather than another. It is relevant to economic analysis.

Break-even quantity

The number of units at which total revenue equals total cost, calculated as fixed costs divided by the difference between unit price and unit variable cost.

Net present value

The sum of discounted future cash inflows minus outflows at a chosen discount rate. A positive NPV indicates the alternative is economically favorable.

Life-cycle cost

The total cost of a system over its entire life, including research and development, procurement, operations and support, and disposal.

Cost estimating relationship

A mathematical or statistical expression relating a cost to one or more independent variables such as quantity, weight, or performance, used in parametric estimating.

Budget justification exhibits

Documents presenting prior-year actuals, current-year estimates, and budget-year requests, separating price changes from program changes to explain year-over-year funding differences.

Accounting equation

Assets equal liabilities plus net position. Every transaction preserves this balance through equal debits and credits.

Debit and credit rules

Debits increase assets and expenses and decrease liabilities and net position; credits increase liabilities, revenue, and net position and decrease assets.

Working capital fund

A revolving fund that finances operations by billing customers for goods and services and using the reimbursements to replenish its capital, rather than receiving annual appropriations.

Fund balance with Treasury

The aggregate amount of agency funds held in Treasury accounts, representing the agency's claim against Treasury cash and reconciled through the Statement of Transactions.

Statement of net cost

A financial statement reporting the net cost of operations, equal to gross costs minus earned revenue, presented by program or responsibility segment.

Statement of budgetary resources

A financial statement showing budgetary resources available, their status, and outlays, linking appropriations and obligations to proprietary results.

USSGL

The U.S. Standard General Ledger, a uniform chart of accounts and transaction codes that standardizes federal agency accounting for budgetary and proprietary transactions.

Full cost

The sum of direct and allocated indirect costs required to produce an output. It supports pricing, reimbursement, and performance decisions.

GAO Green Book

Standards for Internal Control in the Federal Government, organized around five components: control environment, risk assessment, control activities, information and communication, and monitoring.

CFO Act

The Chief Financial Officers Act of 1990, which established CFO positions and required audited financial statements for major federal agencies.

Audit opinion types

Independent auditors issue an unmodified, qualified, adverse, or disclaimer opinion, depending on whether statements are fairly presented and the scope of evidence available.

Material weakness

A deficiency in internal control such that there is a reasonable possibility a material misstatement will not be prevented or detected and corrected timely.