Question

In: Finance

The budgeting policy that requires consideration of the funded delivery period and the production of complete,...

The budgeting policy that requires consideration of the funded delivery period and the production of complete, usable end items is known as:
   Annual Funding
   Full Funding
   Advance Procurement
   Incremental Funding

Solutions

Expert Solution

The practice of funding the total cost of major procurement and construction projects in the Fiscal Year (FY) in which they will be initiated. The full funding policy requires the total estimated cost of a complete, military usable end item or construction project funded in the year in which the item is procured. If a future year’s appropriation is required for delivery of an end item, the end item is not fully funded. It prevents funding programs incrementally and provides a disciplined approach for Program Managers (PMs) to execute their programs within cost.

A DoDI 5000.02 requirement for program initiation of an acquisition program. In this sense, full funding means having the dollars and manpower needed for all current and future efforts to carry out the acquisition strategy in the budget and out-years of the Future Years Defense Program (FYDP) as one of the criteria for the transition into the Engineering and Manufacturing Development (EMD) phase. For Major Defense Acquisition Programs (MDAPs) at Milestone B, the Milestone Decision Authority (MDA) must certify in writing to the Congress that the program is fully funded through the period covered by the FYDP, relative to reasonable cost and schedule estimates, and also meets other criteria. For all acquisition programs, the MDA normally assesses full funding at all major decision points.

Hence, budgeting policy that requires consideration of the funded delivery period and the production of complete, usable end items is known as Full Funding.


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