Page 8 - CCAD FYAnnual Report
P. 8

Financial
Army Working Capital Fund
fffCongress established working capital funds (WCF) to more effectively control and account for the costs of programs and work performed in the DOD. Under the provisionsofTitle10UnitedStates Code, § 2208, the Secretary of Defense may establish WCFs to finance inventories of supplies and industrial-type activities providing common services such as repair, manufacturing or remanufacturing. Unlike profit- oriented commercial businesses, the revolving fund’s goal is to break even by returning monetary gains to customers through lower
Depot Workload
Workload continues to decrease from the FY11-FY12 peak due
rates or collecting any monetary losses from customers through higher rates. Revolving fund prices are generally stabilized or fixed during the year of execution to protect customers from unforeseenfluctuationsthatwould impact their ability to execute the programs approved by Congress.
The basic tenet of the revolving fund structure is to create a customer-provider relationship between military operating units and support organizations, to make managers of the Army Working Capital Fund (AWCF) and decision-makers more aware of
continued uncertainty in the fiscal environment. In FY15, total workload projections decrease
costs for goods and services.
The AWCF directly supports the materiel readiness of operating units. The revolving fund structure encourages cost-effectiveness, flexibilityandadaptabilitytomeet changing workload requirements. It also supports full-cost visibility and recovery while protecting customer accounts from year-of- execution price changes.
roughly 9% to $1.7B and continue to decrease 5-7% per year to approximately $1.2B in FY18.
primarily from fiscal and the residual drawdown from years of conflict. In FY14, total workload was $1.9B: comprised of $0.95B in prior year carry-in (with adjustments) and $0.96 in FY14 new orders. The FY14 new orders were down from the previous year’s $1.3B by 27% due to fluctuations in customer expectations driven by DOD budgets. Looking ahead, CCAD anticipates constrained workload due to
uncertainty
$ Millions
$3,500 $3,000
$2,529
$2,502
$2,313
$2,045 $1,903
$1,711
$2,180
$1,916
$1,749
$1,381 $1,338 $1,506 $1,235
$3,000 $2,500 $2,000 $1,500 $1,000
$500 $0
$2,500 $2,000 $1,500
$1,073        $1,200 $1,168 $1,000
$500 $0
FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Carry-In New Orders Total Workload
Depot Workload FY03-18
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