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A Sustainer’s Guide to Financial Management

The Army organizes its forces into critical warfighting functions to generate combat power. These warfighting functions group Army capabilities into like functions that commanders use to accomplish missions and training objectives. The sustainment warfighting function includes the tasks and systems that provide support and services that ensure Soldiers’ freedom of action, extend their operational reach, and prolong their endurance. This function includes financial management (FM) support.

Reorganizing the FM Structure

Over the last few years, the FM community has reorganized its brigade- and battalion-level command structures. On 1 October 2008, branch code 44 (finance) was merged with functional area 45 (comptroller) to form branch code 36 (financial management). FM is embedded in the sustainment warfighting function, and thus, FM tactical units operate under the command and control of theater support commands and sustainment brigades. Now that the Army is in its third theater rotation under this modular construct, the results demonstrate tremendous value in aligning FM operations with the other sustainment functions to provide an even more powerful and enduring capability to the warfighting force. Always looking for opportunities to improve, the FM community is identifying capability gaps that keep it from maximizing FM support and refining its structure based on lessons learned.

In melding FM operations into sustainment operations, the Army has re-created a marriage of logistics and FM that has a surprising precedent. In the early 20th century, the Army integrated the Finance Corps into the Quartermaster Corps for a short time. Although the two functions were later separated back into individual corps, today’s inclusion of finance in the sustainment warfighting function is built on that enduring foundation.

The Tactical FM Structure

The tactical FM structure includes three echelons: the FM center, FM company, and FM detachment.

FM center. The FM center is the top-tier, tactical-level FM unit. Located at the theater level, the FM center is a 36-person organization that serves as an operational element of the theater support command. Its mission is to provide technical oversight of finance operations across the theater. Specifically, it provides central funding (in U.S. dollars or the local currency), financial planning and policy, internal control, and accounting support. To gain full visibility and support of FM operations, the FM center needs to form a close working relationship with the expeditionary sustainment command (ESC) or, in the absence of an ESC, the FM support operations (FM SPO) section of the sustainment brigade.

The FM center’s success depends on building and fostering strong relationships with sustainment brigade commanders and supporting them by accomplishing the FM mission. The FM center, in its technical oversight role, provides funding support for the FM units below the sustainment brigade and has a robust internal control capability to ensure that FM units are operating effectively and in accordance with theater policies, regulatory requirements, and statutory requirements.

FM company. The second-tier tactical FM unit is the FM company, a 27-person organization that is assigned to the sustainment brigade. As part of Army transformation, and to do its part in gleaning spaces to create the required number of brigade combat teams (BCTs), the Finance Corps reorganized finance battalions into FM companies.

Although it is called a company, the FM company performs the same mission and provides the same level of support as the former finance battalion. The company is responsible for managing three to seven FM detachments and providing the necessary internal controls that enable FM operators to accomplish their missions. The major organizational difference is that the command team consists of a major and a first sergeant in lieu of a lieutenant colonel and a command sergeant major. The FM company also has a sergeant major on staff who serves as the FM operations officer and senior technical subject-matter expert for FM operations in the unit.

Because the FM community is not resourced with enough FM companies to have one FM company for each sustainment brigade, the FM company, in most cases, has a farther reach than the sustainment brigade in which it is assigned. The FM company provides contracting, paying-agent, and banking and currency support, including disbursing and cash-control operations. The company funds subordinate FM detachments and determines currency replenishment needs. The FM company also provides electronic commerce support (for the Eagle-Cash card) and conducts military pay support. The latter responsibility will eventually be assumed by the Army human resources community when the Defense Integrated Military Human Resources System (DIMHRS) is implemented.

FM detachment. The lowest tier tactical FM unit is the FM detachment, which is a 26-person organization that is under the command and control of an FM company. Detachments are considered company-level assets and are commanded by a captain with full Uniform Code of Military Justice authority—just like any other company within the Army. The FM detachment’s mission is to provide area FM support to a BCT or brigade-sized unit or to provide FM support as directed by the FM company commander. The FM detachment commands and directs the operations of widely dispersed, assigned, or attached FM support teams and provides procurement and disbursing support as well as military pay support when required.

Key Players in FM Operations

The FM company and detachment commanders work for the sustainment brigade, but many other stakeholders influence their actions. The FM center provides the technical oversight of their finance operations, and the division G–8 and regional contracting command are key players that make up the other two critical pieces in the procurement process. The Defense Finance and Accounting Service (DFAS), the Department of the Treasury, and the Federal Reserve System support these units’ daily missions at the national-provider level.

DFAS. In contingency operations, the FM company commander serves as a direct agent of the Treasury, which means that the unit has its own checking account with the Treasury. Theoretically, that commander brings the full monetary might of the U.S. Government to his sector of the battlefield merely by possessing a limitless checkbook. However, with great power comes great responsibility. The commander owns—and has pecuniary liability for—every penny that flows within that area. Each FM company maintains its own disbursing account through DFAS to conduct operations within its footprint and must balance the account daily and certify the account monthly.

Defense military pay office. FM operations, especially military pay services, are highly visible across the Army. In garrison, an FM company’s assets are typically used to augment the local Defense military pay office (DMPO) and provide military pay and travel support. The FM company commander may be dual-hatted as the DMPO chief, making him directly accountable to DFAS for local military pay support operations. Under DIMHRS, this function will migrate to the human resources community to be managed by the Army Installation Management Command. Until the migration is complete, where required, FM units must be permitted to assist in the military pay support mission while at home station.

Inspector general’s office. How well an FM unit performs its mission directly affects Soldiers in the most critical way: their paychecks. Soldiers are passionate about their financial entitlements and from time to time use the inspector general’s office to resolve paycheck problems. FM units regularly receive inspector general complaints and congressional inquiries from Soldiers outside of the unit. Every FM unit strives to address these issues quickly and resolve problems accurately. Sustainers should not be alarmed when inspector general inquiries occur because they are a component of an FM unit’s daily business. FM operations are the most self-cleansing operations in the Army. From customer feedback, pay inquiries, daily balancing of the cashbooks, and monthly certification of accounts, FM units know almost immediately if something is not working correctly.

Roles and Responsibilities of FM Units

Many people who are unfamiliar with the scope of the FM mission tend to think that FM units only cash checks and conduct military pay operations in support of Soldiers’ pay. But the most important mission of FM units is to ensure that warfighting commanders have what they need to sustain the fight. This comes in the way of support to the procurement process—the payment and accounting for contracts on the battlefield. To make the procurement process work, the FM company must work in close coordination with the division G–8 section, which has funding and certification authority, contracting officers, and the staff judge advocate.

FM units provide FM support to all units and personnel within their assigned areas. These units are small but highly specialized and have extremely limited self-support capabilities. Roughly 90 percent of an FM unit is made up of 36-series FM Soldiers. The remaining Soldiers are low-density military occupational specialty Soldiers, like mechanics, automation managers, and administrative support personnel. Parent or adjacent units must provide full life support and customer service to sustain FM operations on the battlefield.

FM units control a highly valued commodity: cash. Although currency does not fit into any true doctrinal class of supply, it is one of the most critical supplies on the battlefield and is viewed by many warfighting commanders as a weapon system. Currency as a commodity most closely mirrors class V (ammunition) regarding procedures and treatment. Currency must be properly safeguarded, regularly inventoried, handled and distributed by select and certified personnel, transported under tight security, and properly accounted for at all times. As this finite supply fluctuates at each location, it must be accurately forecasted and managed and reordered in a timely manner. If it is lost, stolen, or destroyed, detailed investigations must ensue, which can result in full pecuniary liability for negligent parties. If the supply runs out, contracts and supply deliveries stop, paying-agent activities halt, and rewards and information programs cease.

Sustainment Brigade Commander’s Concerns

Several FM issues ought to concern the sustainment brigade commander in a deployed environment: losses of funds, status of funds (days of supply), captured or destroyed currency, movement of funds, ability to properly safeguard funds, ongoing missions and operational trends (like paying-agent activities and funding programs), and movement of large units into or out of the FM company’s area of responsibility. These matters are critical to the FM unit’s ability to effectively plan for and accomplish its mission and should concern a sustainment brigade commander. The sustainment brigade’s FM SPO, in conjunction with the FM company commander, should develop, track, and report those critical metrics that allow sustainment leaders to properly gauge the effectiveness of FM operations. The FM SPO also assists the FM company with FM operations planning for its area of responsibility.

By incorporating FM as a part of sustainment operations, the Army adds another key commodity to the sustainment commander’s arsenal and a more robust support capability to the warfighting commander. FM units are small in number and size, but they provide enormous financial leverage on the battlefield. These units rely on the sustainment brigade to provide life support and assistance with future planning, mission analysis of emerging operations, intelligence estimates, FM support forecasting, logistics, and movement coordination. In return, FM units do their part in providing the warfighting commander with the ability to have freedom of action, extend operational reach, and prolong endurance.

Major Brian A. Smith is attending the Naval War College in Newport, Rhode Island. While commanding the 9th Financial Management Company at Fort Lewis, Washington, he converted the unit from a battalion to a company and deployed it to the U.S. Central Command area of responsibility during the first rotation of modular finance units under sustainment brigades. He has a master’s degree in business administration from the University of Maryland.

 
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