1. 2013 NPMA Fall Conference Value Through Professional Asset Management You’re Having a Property Management System Analysis (PMSA)…Now What??? Terri L. Snook, CPPM CF November 13, 2013

2. 2013 NPMA Fall Conference Value Through Professional Asset Management About Me  34 Years in Property Management  Hughes Aircraft Company  Northrop Grumman  Raytheon  Boeing  19 years – Internal Audit and Subcontractor Surveillance  Self-Governance  Retired in Jan 2012

3. 2013 NPMA Fall Conference Value Through Professional Asset Management So…..You get a notification from your Internal (Self- Assessment) or External (GPA) Auditor that you are scheduled for a PMSA. What do you do???

4. 2013 NPMA Fall Conference Value Through Professional Asset Management HELP!!!

5. 2013 NPMA Fall Conference Value Through Professional Asset Management NO!!! Don’t Panic… It’s not as big a deal as you think it is.

6. 2013 NPMA Fall Conference Value Through Professional Asset Management IF………..  You’ve been managing your data  You’ve been working closely with your TEAM  Property Management  Contracts  Program Office  Procurement  Subcontract Control/Subcontractors  Shipping/Receiving  Warehouse  Custodians/Users  Your Customer – ongoing communication…Know your auditor and what is expected!

7. 2013 NPMA Fall Conference Value Through Professional Asset Management FAR 52.245-1 requires that the Contractor has in place a process to assess it’s Property Management System via review, audit, or self- assessment. The Contractor must also make it’s premises available to the Government for the purpose of review, inspection and evaluation of the Property Management System.

8. 2013 NPMA Fall Conference Value Through Professional Asset Management  You must determine risks and prepare for a positive outcome  You must collaborate with other departments and help them understand the risks, values and importance of the analysis to the company. This should be ongoing throughout contract performance. A negative outcome can be very costly!

9. 2013 NPMA Fall Conference Value Through Professional Asset Management What does the auditor look at? What does the auditor look for?

10. 2013 NPMA Fall Conference Value Through Professional Asset Management Ten Lifecycle Outcomes/Processes Analyses should be based on the contract and the 10 primary outcomes, as set forth in FAR 52.245.1 1.Acquisition 2.Receipt 3.Records 4.Physical Inventory 5.Subcontractor Control 6.Reports 7.Relief of Stewardship Responsibility 8.Utilizing 9.Maintenance 10.Property Closeout

11. 2013 NPMA Fall Conference Value Through Professional Asset Management Additional Processes Additional processes are embedded within the Ten (10) Primary Outcomes  Property Management  Identification  Movement  Storage  Consumption  Disposition

12. 2013 NPMA Fall Conference Value Through Professional Asset Management OLD FARNEW FAR FUNCTIONS OUTCOMES OUTCOMES/FUNCTIONS 1*Property Management1Acquisition1 2 2Receipt2 3Receiving3Records Identification 4 4Physical Inventory3Records 5 5Subcontractor Control4Physical Inventory 6Movement6Reports5Subcontractor Control 7Storage7**Relief of Stewardship6Reports 8Physical Inventory8Utilization7**Relief of Stewardship 9Reports9Maintenance8Utilization 10Consumption10Property Closeout Movement 11Utilization Storage 12Maintenance Consumption 13Subcontractor Control 9Maintenance 14Disposition 10Property Closeout 15Contract Closeout Disposition *Property Management is reviewed within each Outcome. **Relief of Stewardship is a new Outcome

13. 2013 NPMA Fall Conference Value Through Professional Asset Management So, You’ve been notified of your PMSA date…Where do you start?  Schedule an Entrance Briefing  Notify involved organizations/functions  Contracts  Programs Offices  Procurement  Subcontracts  Custodians  Anyone else pertinent to the audit It’s VITAL that all organizations and functions remain involved every step of the way….in addition to maintaining a continuous relationship at all times! Ensure that all organization are present at the Entrance Briefing.

14. 2013 NPMA Fall Conference Value Through Professional Asset Management Entrance Briefing – ALWAYS!  Include ALL Affected Organizations  Be Clear of ALL Ground Rules with the Customer  Determine  Outcomes to Be Reviewed  Sample Population  Criteria  Data Required  Understand ALL requirements BEFORE you leave the meeting

15. 2013 NPMA Fall Conference Value Through Professional Asset Management What’s Next?  Gather Documentation  Current Government Property Policies/Procedures  Company’s Property Plan  Contract SOW (If contract specific)  Last Inventory/Reconciliation

16. 2013 NPMA Fall Conference Value Through Professional Asset Management Now let’s look at the specifics of each of the 10 Outcomes and see what will be reviewed and what you will need to ensure SUCCESS!

17. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 1: Acquisition  Contractual Authorization  Statement of Work  CLIN (Line Item in the Contract)  Bill of Material (BOM)  Contract Modification  Procurement Documentation (Reasonable, Allocable, and Allowable)  Purchase Orders (CAP)  DD1149’s/DD1348’s, etc. (GFP)  Transferred  Shipped/Delivered in Place  Provided by Customer  In-house Fabrication Documents Population is generally those items acquired during the past year.

18. 2013 NPMA Fall Conference Value Through Professional Asset Management  Receiving Documentation  Purchase Orders  Packing Slips  DD1149’s/DD1348’s  Fabrication Orders  Items verified/Counted  Discrepancies documented/reported/Isolated  Receipt documented  Proper distribution is completed Outcome 2: Receipt Population is generally those items received during the past year.

19. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 3: Records  Minimal Information FAR paragraph (f)(1)(iii)(A)(1) through (10)  The name, part number and description, National Stock Number (if needed for additional item identification tracking and/or disposition) and other data elements as necessary and required in accordance with the terms and conditions of the contract.  Quantity received (or fabricated), issued, and balance-on-hand.  Unit acquisition cost.  Unique-item identifier or equivalent (if available and necessary for individual item tracking).  Unit of measure.  Accountable contract number or equivalent code designation.  Location.  Disposition.  Posting reference and date of transaction.  Date placed in service (if required in accordance with the terms and conditions of the contract). Property records shall enable a complete, current, auditable record of all transactions

20. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 4: Physical Inventory  Ensure Inventories are performed in accordance with timeframe established in the Property Procedures  Timely Reconciliation  Inventory Reports/Results to Customer  Quantity  ID/Stock Number (if applicable)  Description  IUID (if applicable)  Model Number  Serial Number  Location  Utilization  Inventory Date

21. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 5: Subcontractor Control  Clearly identify items provided  Flow down of contract terms and conditions (e.g., extent of liability for loss of Government property)  Subcontracts are properly administered  Periodic reviews to determine the adequacy of the subcontractor's property management system  Subcontractor Control Records must be maintained in accordance with Terms and Conditions contained in the Subcontract

22. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 6: Reports  Required Reports  Discrepancies  Physical Inventory Results  Loss, Damage, Destruction, and Theft  Corrective Actions  Audits/Self Assessments  Excess Property  Any Reports requested by the Contracting Officer

23. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 7: Relief of Stewardship  Report All Losses, Damage, Destruction and Theft  Ensure a thorough investigation is conducted  Ensure Report is complete  Ensure Record is adjusted immediately after receiving relief of liability

24. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 7: Relief (Cont.)  Report Includes  Date of incident (if known)  The data elements required under paragraph (f)(1)(iii)(A) of this clause  Quantity  Accountable contract number  A statement indicating current or future need  Unit acquisition cost, or if applicable, estimated sales proceeds, estimated repair or replacement costs  All known interests in commingled material of which includes Government material  Cause and corrective action taken or to be taken to prevent recurrence  A statement that the Government will receive compensation covering the loss of Government property, in the event the Contractor was or will be reimbursed or compensated  Copies of all supporting documentation  Last know location  A statement that the property did or did not contain sensitive, export controlled, hazardous, or toxic material, and that the appropriate agencies and authorities were notified

25. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 8: Utilization  Provide documentation to show that Property is utilized, stored, and moved only as authorized in the contract  Utilization screening  Rent-free use  Documentation reflecting that all excess property is reported to the customer

26. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 9: Maintenance  Maintenance Program  Calibration  Preventative Maintenance  Routine Repair  Emergency Repair  Report to Customer  Capital type rehabilitation  Replacement  Property is marked with Last Performed and Next due dates

27. 2013 NPMA Fall Conference Value Through Professional Asset Management Outcome 10: Property Closeout  Closeout Documentation  LDDT Cases  Investigate  Report  Secure closure  Physical Inventory  Reconciliation  Disposal of all Property upon receipt of instructions  Excess  Transfer to Follow-on Contract

28. 2013 NPMA Fall Conference Value Through Professional Asset Management Exit Briefing  Include ALL Organizations involved in the PMSA  Review and understand each finding/observation BEFORE you leave the meeting  Agree on timeframe/submittal of Corrective Action Plan (CAP)

29. 2013 NPMA Fall Conference Value Through Professional Asset Management Corrective Action  Understand what needs to be done  Determine the cause  Look at long term/permanent fix  Don’t bandaid the error  Update Procedures, if necessary  Develop a Milestone plan  Complete all actions on time

30. 2013 NPMA Fall Conference Value Through Professional Asset Management General Rules of Thumb…  Establish all ground rules at the Entrance Briefing  Be Prepared  Don’t volunteer information NOT asked for  Provide documentation in a timely manner  This can vary with each auditor, and should be determined in the entrance briefing.  Provide complete Corrective Action Plan in a timely manner  Complete actions ON TIME  Be COURTEOUS  Be PROFESSIONAL  Be HONEST!!!

31. 2013 NPMA Fall Conference Value Through Professional Asset Management The ??? Ensure that your Property Management TEAM includes all the other organizations… * Maintain continuous and open communication… *Maintain accurate and complete records of all actions *Know your Customer and what’s expected… SUCCESS!

32. 2013 NPMA Fall Conference Value Through Professional Asset Management Questions??? Contact: Terri Snook, CPPM CF 310-910-4925 Snookum_pm@yahoo.com Thank you for your time!