Description
Organization: SPAWAR
Team Name: The Multifunctional Information Distribution System (MIDS) Financial Management Team
Related Acquisition Topic(s): Acquisition Practices Streamlining, Commercial Practices, Integrated Digital Environment (IDE), Partnering
Description:
The Multifunctional Information Distribution System (MIDS) International Program encompasses unique financial management complexities and challenges that have been accommodated through the continuous innovation of the extended MIDS Financial Management Team.
MIDS is an ACAT 1D and international cooperative development program in which five nations (U.S., France, Italy, Germany, Spain) participate under the governing direction of an international Program Memorandum of Understanding (PMOU). The U.S. serves as the host nation for this international program established to design, develop and deliver low-volume, lightweight, tactical information system terminals for U.S. and allied fighter aircraft, bombers, helicopters, ships and ground sites. MIDS will provide interoperability with NATO users, significantly increasing force effectiveness and minimizing hostile actions and friend-on-friend engagements. Subcontractors from each of the five nations perform the development contract under the management of a consortium established specifically for this international development program. The contract is a cost-plus fixed fee and award fee contract valued at approximately $500 million and consists of over 70 contract line/subline items that are funded according to numerous different cost allocation methodologies.
The financial management provisions dictated by the governing PMOU require receipt, payment and management of funds in five currencies, necessitating the creation of processes, methods and capabilities that do not exist within the traditional government payment and disbursements infrastructure. A unique system was established in response to this unorthodox requirement and is built on an international banking system with commercial bank accounts in each of the five nations. The system utilizes an electronic funds transfer system to transfer foreign currencies for payment to the foreign subcontractors; on-site processing and direct payment of monthly vouchers averaging $6 million per month; and, continuous balancing of cost share allocations and payments, per the PMOU. Executing the cost allocations requires constant monitoring and balancing of funds expenditures between the five nations, which is often complicated by unavailability of specific needed currencies at a given time and maintaining expenditures in accordance with the stipulated cost and work share agreements on behalf of the five nations. To facilitate the management of cost allocations, a unique software program, MIDS Financial Management System, was developed and is co-operated by financial analysts in the MIDS Program and the SPAWAR Comptroller Directorate.
As the MIDS Program transitions from development to the cooperative Production Phase, the team is once again planning unique financial management requirements to support three production contracts concurrent with the imminent close out of the development contract. One production contract is being awarded to a European entity to serve the European production requirements including Third Party Sales, and also requires payment in foreign currency.
The effectiveness of the innovative system that supports these unique requirements is evidenced by the promptness of payments and the efficient conduct of the monthly Financial Management Boards where the Financial Team presents voucher analyses, funds status, and payment requirements to the respective foreign national representatives for approval. The innovation demonstrated by the MIDS Financial Management Team has contributed immensely to the success of this five-nation cooperative development acquisition program that is now extending into production. The team members identified above are most deserving of special recognition for acquisition innovation.
