Attachment2-Business FinancialManagementAppendix.doc

Appendix 2

Business and Financial Management

Business and Financial Management Functional Annex

Dated: 29 Jan 2008

A. General Information.

The Business Operations Directorate is the functional manager for the Missile Defense Agency (MDA) business and financial staffs supporting all of MDA’s headquarters directorates and field operations. It is led by a Headquarters staff with functionally matrixed support teams in the National Capitol Region (NCR) and at geographically separated locations. Matrixed support helps ensure all budgeting, programming, and planning activities are conducted uniformly and consistently, making use of common data sets and business practices.

The Business Operations Director reports to the MDA Deputy for Agency Operations. The Directorate provides executive support to the Deputy for Agency Operations and staff, along with on-call support to Agency senior leadership. The Directorate develops, allocates, executes, reviews and analyzes funding and manpower expenditures and other accounting-related matters across the Agency. It supports the validation that all Agency and BMDS programs are resourced in an efficient, business-like manner in which relevant, reliable, and timely management information is available on a regular basis to support informed decision-making at all levels. The Directorate also: directs and monitors the implementation of decisions and executive action plans; establishes and manages Agency fiscal procedures; coordinates fiscal and workforce accounting concerns with Agency senior leadership and external stakeholders, including the Office of Management and Budget, Office of the Secretary of Defense, Military Departments, the Government Accountability Office, and Congressional staffs; collaborates in Base Realignment and Closure related planning and execution; and provides specialized financial management support and oversight to Agency Special Access Programs.

Contractor support to the Directorate includes budget planning, formulation, execution and cost estimating; Base Realignment and Closure planning and transition; internal corporate boards; investment analysis; business operations; external interfaces; earned value management system; accounting systems; and Chief Financial Officers Act compliance. The Business Operations Directorate will use MiDAESS contract support services contracts to obtain expertise for these areas. Task orders awarded under one or more of these contracts will delineate specific task instructions and project requirements.

Support to the Business Operations Directorate is divided into three functional areas:

· Area 1: Business Operations

· Area 2: Earned Value Management System

· Area 3: Accounting Systems and Chief Financial Officers Act Compliance The Statements of Work and related information for each of these functional areas is provided below.

Area 1 – Business Operations

1.B. Statement of Work - (Area 1) Business Operations.

Business Operations

1.C. Estimated Man-year Equivalents (MYEs)/Performance Locations - (Area 1) Business Operations.

The next chart shows the primary locations and total MYEs in 2008 and 2010 to support Business Operations. All positions are on-site. This workforce will shift locale due to Base Realignment and Closure between now and fiscal year 2011. The largest impact is movement of personnel from the Navy Annex in the National Capitol Region (NCR) to Huntsville, AL. We will have a small Government leadership team within the National Capitol Region remaining at Ft. Belvoir, VA when construction of facilities is complete. Contractor support services employees may be asked to support that team.

MYEs by Location with Anticipated BRAC Adjustments

Note: There is a potential for the majority of the Business Operations organization to transition as early as fiscal year 2009 from the National Capital Region to Huntsville, AL. Due to a projected shortage in office spaces until construction of the Agency’s Von Braun-III office complex is completed at Redstone Arsenal, contract support services employees may be asked to reside within Huntsville, AL company offices on an interim basis.

This chart shows the primary skill mix, experience level and man-year equivalents we anticipate are required to support Business Operations.

Sample Skill Mix*

Level # Man Year Equivalents

* Position/skill category descriptions and/or definitions have not been provided.

1.D. Deliverables/General Work Products - (Area 1) Business Operations.

· Transition Plan

· Management Plan

· Monthly Status Reports

· Funds and Labor Hour Expenditure Reports

· Technical Reports, Studies, Presentations, and Briefing Materials

· Drafts of executive-level decision memoranda and guidance letters

This Draft RFP provides Contract Data Requirements List (CDRL) submittals common to all MiDAESS contracts. Specialized or tailored CDRL items will be included in final requests for proposal (RFPs) for each functional annex/area.

1.E. Anticipated Contract Awards - (Area 1) Business Operations.

We anticipate two to three full-and-open competitive awards covering the full range of requirements in functional Area 1. Each selected contractor must be able to perform all of the tasks provided in the Statement of Work at all listed locations.

We are continuing our search for additional small business opportunities in this area. Final determinations will be made after reviewing responses to our sources sought announcement.

We will determine the actual number of MYEs to be awarded on the first set of task orders based upon on-going manpower reviews and an analysis of existing contracts transitioning into the MiDAESS program. We plan to divide the first set of task orders into a near equal work share across all awardees. For example, if we make 3 awards, each awardee would get approximately 33% of the total work share for their first task order. We will award subsequent task orders based on evaluation criteria such as cost and ongoing performance as explained in this Draft Request for Proposal (DRFP), the final RFP and contract for Business Operations and subsequent task order specific RFPs.

We anticipate a 300 MYE ceiling on contractor support services at time of contract award with a possible expansion of the ceiling by 10% based upon additional taskings and available funding. The final RFP for Business Operations will contain firm man-year equivalents for award.

1.F. Small Business - (Area 1) Business Operations.

The applicable NAICS Code is 541611 and size standard is $6.5 million annual revenue for the “Statement of Work—Business Operations.”

1.G. Security Requirements - (Area 1) Business Operations.

We require a minimum of a SECRET security clearance for all employees and approximately 10% of workforce holding Top Secret clearances, with at least one immediately upon contract award. We also require up to 12 personnel to hold Top Secret/Special Compartmentalized Information clearances to support ongoing classified work.

1.H. Travel Requirements – (Area 1) Business Operations.

The Business Operations Directorate supports all facets of the BMDS. Contract support services employees should expect to travel from 10% to 20% of their time to various locations of systems, specific components, manufacturing sites, integration sites, and test sites.

1.I. Government Furnished Information/Equipment/Support - (Area 1) Business Operations.

· MDA will provide access to MDA facilities as required, including on-site work stations with computers and telephones

· Access to Planning, Programming, Budgeting, and Execution System (PPBES) information

· Government laptops and Blackberries may be provided on a need-justified basis

1.J. Unique Source Selection Criteria - (Area 1) Business Operations.

The Draft Request for Proposal includes source selection criteria we will use for the Business Operations solicitation.

The final RFP will include a Sample Problem specific to Business Operations. Below is a sample problem representative of the problem you will see in the final RFP.

Area 1 Sample Problem: You are responsible for setting up the business and financial management office in a new program office that will be developing an air launched hit-to-kill weapon. Describe what steps you need to take to set that office up to include describing in detail what functions the office will perform, how many people there will be in the office and what will each do, how the office will interface with MDA Headquarters (the functional manager), the program manager and the other functional managers in the program office, what will be the interactions with the contractor, what internal processes and controls you need to establish and how you will develop the initial program budget.

1.K. Organizational Conflict of Interest – (Area 1) Business Operations.

The MDA Director relies on the Business Operations Director to provide unbiased analysis, judgment and recommendations for action. The potential for conflicts of interest, whether real or perceived, is significant for those prime and subcontractors providing support to the Business Operations Director and also providing support elsewhere in the Missile Defense Agency. Careful analysis of conflicts of interest must be accomplished by each offeror. We will allow both prime and subcontractors to accomplish this work only after the Contracting Officer approves a thorough and comprehensive mitigation plan that ensures your work remains independent of other program work. See Section H, Clause H-08, Organizational Conflicts of Interest (OCI) (January 2008), for additional guidance.

Area 2 - Earned Value Management System 2.A. General Information – (Area 2) Earned Value Management System.

The Business Operations Directorate is responsible for the Earned Value Management System (EVMS) Program. This includes: development and implementation of practices for applying Earned Value Management principles in the conduct of integrated assessments at the BMDS Program level to incorporate linkages among functional program assessments (budget, schedule, technical); and supporting integrated assessments and demonstrate the ability to develop and defend independent estimates at completion. Also support Agency Earned Value Management external interfaces (Office of the Secretary of Defense) to include assembling, integrating, evaluating and analyzing data; providing training; and supporting program reviews, meetings, conferences and seminars.

2.B. Statement of Work – (Area 2) Earned Value Management System.

Earned Value Management

2.C. Estimated Man-year Equivalents (MYEs)/Performance Locations – (Area 2) Earned Value Management System.

This chart shows the primary locations and total MYEs in 2008 and 2010 to support EVMS. All positions are on-site. This workforce will shift locale due to Base Realignment and Closure (Base Realignment and Closure) between now and fiscal year 2011. The largest impact is movement of personnel from the Navy Annex in the National Capitol Region (NCR) to Huntsville, AL.

MYEs by Location with Anticipated BRAC Adjustments

Note: There is a potential for the majority of the Business Operations organization to transition as early as fiscal year 2009 from the National Capital Region to Huntsville, AL. Due to a projected shortage in office spaces until construction of the Agency’s Von Braun-III office complex is completed at Redstone Arsenal, contract support services employees may be asked to reside within Huntsville, AL company offices on an interim basis.

This chart shows the primary skill mix, experience level and man-year equivalents we anticipate are required to support EVMS.

Sample Skill Mix*

Level # Man-year Equivalents

2.D. Deliverables/General Work Products – (Area 2) Earned Value Management System.

· Transition Plan

· Management Plan

· Monthly Status Reports

· Funds and Labor Hour Expenditure Reports

· Technical Reports, Studies, Presentations, and Briefing Materials

· Drafts of Executive-level decision memoranda and guidance letters

This Draft RFP provides Contract Data Requirements List (CDRL) submittals common to all MiDAESS contracts. Specialized or tailored CDRL items will be included in final requests for proposal (RFPs) for each functional annex/area.

2.E. Anticipated Contract Awards – (Area 2) Earned Value Management System.

We anticipate a minimum of two small business set-aside awards for functional Area 2 covering the full range of Earned Value Management System support. Each selected contractor must be capable of performing all of the tasks provided in the Statement of Work at all locations listed in this annex.

We anticipate awarding a near equal share of available man-year equivalents to each contract award recipient with the first set of task orders. We plan to divide the first task order into equal work shares across all awardees. For example, if we make two contract awards, each awardee would get 50% of the total work share from the first set of task orders. We will award subsequent task orders based on evaluation criteria such as cost and ongoing performance as explained in the Draft Request for Proposal (DRFP), the final RFP and contract for the Earned Value Management System and subsequent task order specific RFPs.

We anticipate a 24 man-year ceiling on contract at time of contract award with a possible expansion of the ceiling by 10% based upon additional taskings and available funding. We will not award all 24 man-year equivalents with the first task order. Rather, we will determine the number of man-year equivalents awarded with the first set of task orders based upon on-going manpower reviews and an analysis of existing contracts transitioning into the MiDAESS program. The final RFP for EVMS will contain firm man-year equivalents for award.

2.F. Small Business – (Area 2) Earned Value Management System.

The applicable NAICS Code is 541611 and size standard is $6.5 million annual revenue for the “Statement of Work—Earned Value Management.”

2.G. Security Requirements - (Area 2) Earned Value Management System.

We require a minimum of a SECRET security clearance for all employees with 100% immediately upon contract award; and approximately 10% of the workforce holding Top Secret clearances, with at least one immediately upon contract award. We also require one (1) person to hold Top Secret/Special Compartmentalized Information clearances to support ongoing classified work.

2.H. Travel Requirements - (Area 2) Earned Value Management System.

Contractor employees should expect to travel from 10% to 15% of their time to various locations of systems, specific components, manufacturing sites, integration sites, and test sites.

2.I. Government Furnished Information/Equipment/Support - (Area 2) Earned Value Management System.

· MDA will provide access to MDA facilities as required, including on-site work stations with computers and telephones

· Access to Planning, Programming, Budgeting, and Execution System (PPBES) information

· Government laptops and Blackberries may be provided on a need-justified basis

2.J. Unique Source Selection Criteria - (Area 2) Earned Value Management System.

This Draft Request for Proposal includes source selection criteria that we will use for the Business Operations solicitation.

The final RFP will include a Sample Problem specific to Business Operations. Below is a sample problem representative of the problem you will see in the final RFP.

Area 2 Sample Problem: Your boss has given you the job of setting up an EVMS for a new program office. This EVMS will be for the work the contractor is going to do on the air launch hit-to-kill interceptor. Currently the contractor does not have a validated EVMS. Describe what you need to do with the contractor to get a validated EVMS to include criteria for validation, what steps you need to take to set up an EVMS baseline for the program and how you would set up processes for analyzing the data that comes from the EVMS.

2.K. Organizational Conflict of Interest – (Area 2) Earned Value Management System.

The MDA Director relies on the Business Operations Director to provide unbiased analysis, judgment and recommendations for action. The potential for conflicts of interest, whether real or perceived, is significant for those prime and subcontractors providing support to the Business Operations Director and also providing support elsewhere in the Missile Defense Agency. Careful analysis of conflicts of interest must be accomplished by each offeror. We will allow both prime and subcontractors to accomplish this work only after the Contracting Officer approves a thorough and comprehensive mitigation plan that ensures your work remains independent of other program work. See Section H, Clause H-08, Organizational Conflicts of Interest (OCI) (January 2008), for additional guidance.

Area 3 - Accounting Systems and Chief Financial Officer (CFO) Act Compliance 3.A. General Information – (Area 3) Accounting Systems and CFO Act Compliance.

The Business Operations Directorate is responsible for compliance with the Accounting Systems and Chief Financial Officer Act. This includes providing accounting and financial record reconciliation; accounting and financial information systems support; and assisting in development of the necessary supporting documents and audit trails to prepare the Agency’s Annual Financial Statements in accordance with the Chief Financial Officers (CFO) Act.

3.B. Statement of Work - (Area 3) Accounting Systems and CFO Act Compliance.

Accounting Systems and CFO Act Compliance

3.C. Estimated Man-year Equivalents (MYEs)/Performance Locations - (Area 3) Accounting Systems and CFO Act Compliance.

This chart shows the primary locations and total man-year equivalents in October 2008 and October 2010 to support accounting systems and CFO Act compliance. All positions are on-site. This workforce will shift locale due to Base Realignment and Closure (Base Realignment and Closure) between now and fiscal year 2011. The largest impact is movement of personnel from the Navy Annex in the National Capitol Region to Huntsville, AL.

MYEs by Location with Anticipated BRAC Adjustments

Note: There is a potential for the majority of the Business Operations organization to transition as early as fiscal year 2009 from the National Capital Region to Huntsville, AL. Due to a projected shortage in office spaces until construction of the Agency’s Von Braun-III office complex is completed; contract support services employees may be asked to reside within Huntsville, AL company offices on an interim basis.

This chart shows the primary skill mix, experience level and man-year equivalents we anticipate are required to support accounting systems and CFO Act compliance.

Area 3 Sample Skill Mix*

Level # Man-year Equivalents

3.D. Deliverables/General Work Products - (Area 3) Accounting Systems and CFO Act Compliance.

· Transition Plan

· Management Plan

· Monthly Status Reports

· Funds and Labor Hour Expenditure Reports

· Technical Reports, Studies, Presentation, and Briefing Materials

· Drafts of Executive-level decision memoranda and guidance letters

This Draft RFP provides Contract Data Requirements List (CDRL) submittals common to all MiDAESS contracts. Specialized or tailored CDRL items will be included in final requests for proposal (RFPs) for each functional annex/area.

3.E. Anticipated Contract Awards - (Area 3) Accounting Systems and CFO Act Compliance.

We anticipate a minimum of two small business set-aside awards for functional Area 3 covering the full range of support for Accounting Systems and Chief Financial Officer Act compliance. Each selected contractor must be capable of performing all of the tasks provided in the Statement of Work listed in this annex.

We anticipate awarding a near equal share of available man-year equivalents to each contract award recipient with the first set of task orders. We plan to divide the first set of task orders into equal work shares across all awardees. For example, if we make two contract awards, each awardee would get approximately 50% of the total work share from the first set of task orders. We will award subsequent task orders based on evaluation criteria such as cost and ongoing performance as explained in the Draft Request for Proposal (DRFP), the final RFP and contract for Accounting Systems and CFO Act Compliance and subsequent task order specific RFPs.

We anticipate a 38 man-year ceiling on contract at time of award with a possible expansion of the ceiling by 10% based upon additional taskings and available funding. We will not award all 38 man-year equivalents with the first set of task orders. Rather, we will determine the number of man-year equivalents awarded with the first set of task orders from on-going manpower reviews and an analysis of existing contracts transitioning into the MiDAESS program. We anticipate the man-year equivalents on the first set of task orders to total approximately XX.

3.F. Small Business - (Area 3) Accounting Systems and CFO Act Compliance.

The applicable NAICS Code is 541219 and size standard is $7.4 million annual revenue for the “Statement of Work—Accounting Systems and CFO Act Compliance.”

3.G. Security Requirements - (Area 3) Accounting Systems and CFO Act Compliance.

We require a minimum of a SECRET security clearance for all employees with 100% immediately upon contract award and approximately 10% of the workforce holding Top Secret clearances, with at least one immediately upon contract award. We also require one (1) person to hold Top Secret/Special Compartmentalized Information clearances to support ongoing classified work.

3.H. Travel Requirements - (Area 3) Accounting Systems and CFO Act Compliance.

The Business Operations Directorate supports all facets of the BMDS. Contract support services employees should expect to travel from 10% to 20% of their time to various locations of systems, specific components, manufacturing sites, integration sites and test sites.

3.I. Government Furnished Information/Equipment/Support - (Area 3) Accounting Systems and CFO Act Compliance.

· MDA will provide access to MDA facilities as required, including on-site work stations with computers and telephones

· Access to Planning, Programming, Budgeting, and Execution System (PPBES) information

· Government laptops and Blackberries may be provided on a need-justified basis

3.J. Source Selection Criteria - (Area 3) Accounting Systems and CFO Act Compliance.

The Draft Request for Proposal includes source selection criteria that we will use for the Business Operations solicitation.

The final RFP will include a Sample Problem specific to Business Operations. Below is a sample problem representative of the problem you will see in the final RFP.

Area 3 Sample Problem: Describe your approach to prepare the Agency for a clean audit report on all financial activities. Focus on how you would assist in addressing our executing agents' (e.g., the Services) financial records.

3.K. Organizational Conflict of Interest – (Area 3) Accounting Systems and CFO Act Compliance.

The MDA Director relies on the Business Operations Director to provide unbiased analysis, judgment and recommendations for action. The potential for conflicts of interest, whether real or perceived, is significant for those prime and subcontractors providing support to the Business Operations Director and also providing support elsewhere in the Missile Defense Agency. Careful analysis of conflicts of interest must be accomplished by each offeror. We will allow both prime and subcontractors to accomplish this work only after the Contracting Officer approves a thorough and comprehensive mitigation plan that ensures your work remains independent of other program work. See Section H, Clause H-08, Organizational Conflicts of Interest (OCI) (January 2008), for additional guidance.