[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 3487 Introduced in Senate (IS)]

112th CONGRESS
  2d Session
                                S. 3487

  To provide for auditable financial statements for the Department of 
                    Defense, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             August 2, 2012

 Mr. Coburn (for himself, Mr. Manchin, Ms. Ayotte, Mrs. McCaskill, Mr. 
     Cornyn, Mr. Grassley, Mr. Johnson of Wisconsin, and Mr. Paul) 
introduced the following bill; which was read twice and referred to the 
                      Committee on Armed Services

_______________________________________________________________________

                                 A BILL


 
  To provide for auditable financial statements for the Department of 
                    Defense, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Audit the Pentagon Act of 2012''.

SEC. 2. FINDINGS.

    Congress makes the following findings:
            (1) Section 9 of Article 1 of the Constitution of the 
        United States requires all agencies of the Federal Government, 
        including the Department of Defense, to publish ``a regular 
        statement and account of the receipts and expenditures of all 
        public money''.
            (2) Section 3515 of title 31, United States Code, requires 
        the agencies of the Federal Government, including the 
        Department of Defense, to present auditable financial 
        statements beginning not later than March 1, 1997. The 
        Department has not complied with this law.
            (3) The Federal Financial Management Improvement Act of 
        1996 (31 U.S.C. 3512 note) requires financial systems acquired 
        by the Federal Government, including the Department of Defense, 
        to be able to provide information to leaders to manage and 
        control the cost of government. The Department has not complied 
        with this law.
            (4) The financial management of the Department of Defense 
        has been on the ``High-Risk'' list of Government Accountability 
        Office, which means that the Department is not consistently 
        able to ``control costs; ensure basic accountability; 
        anticipate future costs and claims on the budget; measure 
        performance; maintain funds control; [and] prevent and detect 
        fraud, waste, and abuse''.
            (5) The National Defense Authorization Act for Fiscal Year 
        2002 (Public Law 107-107) requires the Secretary of Defense to 
        report to Congress annually on the reliability of the financial 
        statements of the Department of Defense, to minimize resources 
        spent on producing unreliable financial statements, and to use 
        resources saved to improve financial management policies, 
        procedures, and internal controls.
            (6) In 2005, the Department of Defense created a Financial 
        Improvement and Audit Readiness (FIAR) Plan, overseen by a 
        directorate within the office of the Under Secretary of Defense 
        (Comptroller), to improve Department business processes with 
        the goal of producing timely, reliable, and accurate financial 
        information that could generate an audit-ready annual financial 
        statement. In December 2005, that directorate, known as the 
        FIAR Directorate, issued the first of a series of semiannual 
        reports on the status of the Financial Improvement and Audit 
        Readiness Plan.
            (7) The National Defense Authorization Act for Fiscal Year 
        2010 (Public Law 111-84) requires regular status reports on the 
        Financial Improvement and Audit Readiness Plan described in 
        paragraph (6), and codified as a statutory requirement the goal 
        of the Plan in ensuring that Department of Defense financial 
        statements are validated as ready for audit not later than 
        September 30, 2017.
            (8) At a September 2010 hearing of the Senate, the 
        Government Accountability Office stated that past expenditures 
        by the Department of Defense of $5,800,000,000 to improve 
        financial information, and billions of dollars more of 
        anticipated expenditures on new information technology systems 
        for that purpose, may not suffice to achieve full audit 
        readiness of the financial statement of the Department. At that 
        hearing, the Government Accountability Office could not predict 
        when the Department would achieve full audit readiness of such 
        statements.

SEC. 3. AUDIT READINESS OF THE FINANCIAL STATEMENTS OF THE DEPARTMENT 
              OF DEFENSE.

    (a) Inclusion of Statement of Budget Resources Within FIAR Plan.--
Subsection (a)(2)(A) of section 1003 of the National Defense 
Authorization Act for Fiscal Year 2010 (Public Law 111-84; 123 Stat. 
2439; 10 U.S.C. 2222 note) is amended--
            (1) in clause (i), by striking ``and'' at the end;
            (2) by redesignating clause (ii) as clause (iv); and
            (3) by inserting after clause (i) the following new 
        clauses:
                            ``(ii) ensuring that a complete and 
                        validated statement of budgetary resources of 
                        the Department of Defense is ready by not later 
                        than September 30, 2014;
                            ``(iii) ensuring that the full set of 
                        consolidated financial statements of the 
                        Department for the fiscal year ending September 
                        30, 2017, and each fiscal year thereafter, are 
                        ready in a timely manner and in preparation for 
                        an audit, including submitting the reports not 
                        later than November 15, 2017, and each year 
                        thereafter, in order to seek an audit opinion 
                        on its financial statements; and''.
    (b) Definition of Validated as Ready for Audit.--Such section is 
further amended by adding at the end the following new subsection:
    ``(d) Validated as Ready for Audit Defined.--In this section, the 
term `validated as ready for audit' means the following:
            ``(1) In the case of the financial statements of a military 
        department, that the audit agencies of the military department 
        have reviewed such statements and determined, in writing, that 
        such statements are ready for audit.
            ``(2) In the case of the financial statements of a Defense 
        Agency, that the audit agencies of the Defense Agency have 
        reviewed such statements and determined, in writing, that such 
        statements are ready for audit.''.

SEC. 4. CESSATION OF APPLICABILITY OF REPORTING REQUIREMENTS REGARDING 
              THE FINANCIAL STATEMENTS OF THE DEPARTMENT OF DEFENSE.

    (a) Cessation of Applicability.--
            (1) Military departments.--The financial statements of a 
        military department shall cease to be covered by the reporting 
        requirements specified in subsection (b) upon the issuance of 
        an unqualified audit opinion on such financial statements.
            (2) Department of defense.--The reporting requirements 
        specified in subsection (b) shall cease to be effective when an 
        unqualified audit opinion is issued on the financial statements 
        of the Department of Defense, including each of the military 
        departments and the Defense Agencies.
    (b) Reporting Requirements.--The reporting requirements specified 
in this subsection are the following:
            (1) The requirement for semi-annual reports in section 
        1003(b) of the National Defense Authorization Act for Fiscal 
        Year 2010 (Public Law 111-84; 123 Stat. 2440; 10 U.S.C. 2222 
        note).
            (2) The requirement for annual reports in section 1008(a) 
        of the National Defense Authorization Act for Fiscal Year 2002 
        (Public Law 107-107; 115 Stat. 1204; 10 U.S.C. 113 note).

SEC. 5. REPORT ON DEPARTMENT OF DEFENSE REPORTING REQUIREMENTS MADE 
              OBSOLETE BY OR AFFECTING AUDITS WITH UNQUALIFIED 
              OPINIONS.

    Not later than 180 days after the date of the enactment of this 
Act, the Under Secretary of Defense (Comptroller) shall submit to 
Congress a report setting forth the following:
            (1) A list of each report of the Department of Defense 
        required by law to be submitted to Congress which, in the 
        opinion of the Under Secretary, would no longer be necessary if 
        the financial statements of the Department of Defense were 
        audited with an unqualified opinion.
            (2) A list of each report of the Department required by law 
        to be submitted to Congress which, in the opinion of the Under 
        Secretary, interferes with the capacity of the Department to 
        achieve an audit of the financial statements of the Department 
        with an unqualified opinion.

SEC. 6. ENHANCED REPROGRAMMING AUTHORITY FOLLOWING ACHIEVEMENT BY 
              MILITARY DEPARTMENTS OF AUDIT WITH UNQUALIFIED OPINION OF 
              STATEMENT OF BUDGETARY RESOURCES FOR FISCAL YEARS AFTER 
              FISCAL YEAR 2013.

    (a) In General.--Subject to section 9(a)(1), if a military 
department obtains an audit with an unqualified opinion on its 
statement of budgetary resources for any fiscal year after fiscal year 
2013, the thresholds for reprogramming of funds without prior notice to 
Congress for the succeeding fiscal year shall be deemed to be the 
thresholds as follows:
            (1) In the case of an increase or decrease to the program 
        base amount for a procurement program, $60,000,000.
            (2) In the case of an increase or decrease to the program 
        base amount for a research program, $30,000,000.
            (3) In the case of an increase or decrease to the amount 
        for a budget activity for operation and maintenance, 
        $45,000,000.
            (4) In the case of an increase or decrease to the amount 
        for a budget activity for military personnel, $30,000,000.
    (b) Construction.--Nothing in this section shall be construed to 
alter or revise any requirement (other than a threshold amount) for 
notice to Congress on reprogrammings covered by subsection (a) under 
any other provision of law.
    (c) Definitions.--In this section, the terms ``program base 
amount'', ``procurement program'', ``research program'', and ``budget 
activity'' have the meanings given such terms in chapter 6 of volume 3 
of the Financial Management Regulation of the Department of Defense 
(DoD 7000.14R), dated March 2011, or any successor document.

SEC. 7. AVAILABILITY OF EXPIRING FUNDS FOLLOWING ACHIEVEMENT BY 
              MILITARY DEPARTMENTS OF AUDIT WITH UNQUALIFIED OPINION OF 
              STATEMENT OF BUDGETARY RESOURCES FOR FISCAL YEARS AFTER 
              FISCAL YEAR 2013.

    (a) In General.--Subject to section 9(a)(1), if a military 
department obtains an audit with an unqualified opinion on its 
statement of budgetary resources for a fiscal year after fiscal year 
2013 (in this section referred to as a ``covered fiscal year''), the 
amount described in subsection (b) shall be available for the purposes 
specified in subsection (c) at the end of such covered fiscal year 
without fiscal year limitation.
    (b) Available Amount.--The amount described in this subsection is 
the amount equal to five percent of the aggregate amount of unobligated 
appropriations available to the military department concerned for a 
covered fiscal year that would otherwise expire at the end of such 
covered fiscal year by law.
    (c) Purposes.--
            (1) In general.--Except as provided in paragraph (2) and 
        subject to paragraph (3), amounts available under subsection 
        (a) shall, at the election of the Secretary of the military 
        department concerned, be available for purposes as follows:
                    (A) Payment in accordance with applicable law of 
                bonuses authorized by law (including awards authorized 
                by subchapter I of chapter 45 of title 5, United States 
                Code) for civilian employees of the military 
                department, including employees determined to have made 
                beneficial contributions to the achievement of the 
                mission of the military department.
                    (B) Procurement of weapons and weapon systems.
                    (C) Military education and training programs and 
                activities of the military department.
            (2) Exclusion.--Amounts available under subsection (a) 
        shall not be available for purposes as follows:
                    (A) Research, development, test, and evaluation.
                    (B) Military construction.
            (3) Limitations on bonuses.--
                    (A) Limitation on bonus amount.--The amount of the 
                bonus payable to a civilian employee of a military 
                department under paragraph (1)(A) in any year may not 
                exceed the amount equal to 25 percent of the base pay 
                of the employee in such year.
                    (B) Limitation on aggregate amount of bonuses.--The 
                total amount of bonuses payable to civilian employees 
                of a military department under paragraph (1)(A) in any 
                year may not exceed $5,000,000.
                    (C) Construction.--Nothing in paragraph (1)(A) may 
                be construed to authorize or provide for the payment of 
                a bonus to an officer or employee of a contractor of 
                the Department of Defense.
    (d) Transfers.--
            (1) In general.--Notwithstanding any other provision of 
        law, the Secretary of a military department may transfer 
        amounts described in subsection (b) that are available under 
        subsection (a) among accounts of the military department for 
        purposes of exercising the authority in subsection (a) with 
        respect to such amounts. Amounts so transferred shall be merged 
        with amounts in the account or fund to which transferred and 
        shall be available under the same terms and conditions as the 
        amounts with which merged for the purposes specified in 
        subsection (c).
            (2) No new appropriation.--A transfer under paragraph (1) 
        shall not be treated as a new appropriation of the amount so 
        transferred.
    (e) Reports.--
            (1) Annual reports.--The Secretary of Defense shall submit 
        to Congress each year (at the same time the budget of the 
        President for a fiscal year is submitted to Congress in such 
        year pursuant to section 1105 of title 31, United States Code) 
        a report on the exercise of the authority under this section 
        during the previous fiscal year. Each report under this 
        subsection shall include, for the fiscal year covered by such 
        report, the following:
                    (A) The amounts transferred under subsection (d), 
                including the total amount transferred and the amounts 
                transferred to each account to which transferred.
                    (B) The purposes, and amounts, for which amounts 
                transferred were used.
            (2) Notice on procurement.--Not later than 30 days before 
        using amounts available under subsection (a) for the 
        procurement of weapons or a weapon system, the Secretary of the 
        military department concerned shall submit to Congress a 
        report, in writing, on the use of such amounts for that 
        purpose. Each report shall include a statement of the weapons 
        or weapon system to be procured and the amount to be used for 
        such procurement.

SEC. 8. FAILURE TO OBTAIN AUDITS WITH UNQUALIFIED OPINION OF FISCAL 
              YEAR 2014 STATEMENT OF BUDGETARY RESOURCES OF THE 
              DEPARTMENT OF DEFENSE.

    (a) In General.--If the Department of Defense fails to obtain an 
audit with an unqualified opinion on its statement of budgetary 
resources for fiscal year 2014, the following shall take effect, 
effective as of the date of the issuance of the opinion on such audit:
            (1) Additional qualifications and duties of usd 
        (comptroller).--
                    (A) Qualifications.--Any individual nominated for 
                appointment to the position of Under Secretary of 
                Defense (Comptroller) under section 135 of title 10, 
                United States Code, shall be an individual who has 
                served--
                            (i) as the chief financial officer of a 
                        Federal or State agency that has received an 
                        audit with an unqualified opinion on such 
                        agency's financial statements during the time 
                        of such individual's service; or
                            (ii) as the chief financial officer of a 
                        public company that has received an audit with 
                        an unqualified opinion on such company's 
                        financial statements during the time of such 
                        individual's service.
                    (B) Duties and powers.--The duties and powers of 
                the individual serving as Under Secretary of Defense 
                (Comptroller) shall include, in addition to the duties 
                and powers specified in section 135(c) of title 10, 
                United States Code, such duties and powers with respect 
                to the financial management of the Department of 
                Defense as the Deputy Secretary of Defense (acting in 
                the capacity of Chief Management Officer of the 
                Department of Defense) or a successor official in the 
                Department of Defense (acting in such capacity) may 
                prescribe.
            (2) Additional qualifications and responsibilities of asa 
        for financial management.--
                    (A) Qualifications.--Any individual nominated for 
                appointment to the position of Assistant Secretary of 
                the Army for Financial Management under section 3016 of 
                title 10, United States Code, shall be an individual 
                who has served--
                            (i) as the chief financial officer of a 
                        Federal or State agency that has received an 
                        audit with an unqualified opinion on such 
                        agency's financial statements during the time 
                        of such individual's service; or
                            (ii) as the chief financial officer of a 
                        public company that has received an audit with 
                        an unqualified opinion on such company's 
                        financial statements during the time of such 
                        individual's service.
                    (B) Responsibilities.--The responsibilities of the 
                individual serving as Assistant Secretary of the Army 
                for Financial Management shall include, in addition to 
                the responsibilities specified in section 3016(b)(4) of 
                title 10, United States Code, such responsibilities as 
                the Deputy Secretary of Defense (acting in the capacity 
                of Chief Management Officer of the Department of 
                Defense) or a successor official in the Department of 
                Defense (acting in such capacity) may prescribe.
            (3) Additional qualifications and responsibilities of asn 
        for financial management.--
                    (A) Qualifications.--Any individual nominated for 
                appointment to the position of Assistant Secretary of 
                the Navy for Financial Management under section 5016 of 
                title 10, United States Code, shall be an individual 
                who has served--
                            (i) as the chief financial officer of a 
                        Federal or State agency that has received an 
                        audit with an unqualified opinion on such 
                        agency's financial statements during the time 
                        of such individual's service; or
                            (ii) as the chief financial officer of a 
                        public company that has received an audit with 
                        an unqualified opinion on such company's 
                        financial statements during the time of such 
                        individual's service.
                    (B) Responsibilities.--The responsibilities of the 
                individual serving as Assistant Secretary of the Navy 
                for Financial Management shall include, in addition to 
                the responsibilities specified in section 5016(b)(4) of 
                title 10, United States Code, such responsibilities as 
                the Deputy Secretary of Defense (acting in the capacity 
                of Chief Management Officer of the Department of 
                Defense) or a successor official in the Department of 
                Defense (acting in such capacity) may prescribe.
            (4) Additional qualifications and responsibilities of asaf 
        for financial management.--
                    (A) Qualifications.--Any individual nominated for 
                appointment to the position of Assistant Secretary of 
                the Air Force for Financial Management under section 
                8016 of title 10, United States Code, shall be an 
                individual who has served--
                            (i) as the chief financial officer of a 
                        Federal or State agency that has received an 
                        audit with an unqualified opinion on such 
                        agency's financial statements during the time 
                        of such individual's service; or
                            (ii) as the chief financial officer of a 
                        public company that has received an audit with 
                        an unqualified opinion on such company's 
                        financial statements during the time of such 
                        individual's service.
                    (B) Responsibilities.--The responsibilities of the 
                individual serving as Assistant Secretary of the Air 
                Force for Financial Management shall include, in 
                addition to the responsibilities specified in section 
                8016(b)(4) of title 10, United States Code, such 
                responsibilities as the Deputy Secretary of Defense 
                (acting in the capacity of Chief Management Officer of 
                the Department of Defense) or a successor official in 
                the Department of Defense (acting in such capacity) may 
                prescribe.
    (b) Public Company Defined.--In this section, the term ``public 
company'' has the meaning given the term ``issuer'' in section 2(a)(7) 
of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201(a)(7)).

SEC. 9. FAILURE TO OBTAIN AUDITS WITH UNQUALIFIED OPINION OF FISCAL 
              YEAR 2017 FINANCIAL STATEMENTS OF THE DEPARTMENT OF 
              DEFENSE.

    (a) Military Departments.--
            (1) Cessation of authorities on reprogramming and 
        availability of funds.--If a military department fails to 
        obtain an audit with an unqualified opinion on its financial 
        statements for fiscal year 2017, effective as of the date of 
        the issuance of the opinion on such audit, the authorities in 
        sections 6 and 7 shall cease to be available to the military 
        department for fiscal year 2017 or any fiscal year thereafter.
            (2) Prohibition on expenditure of funds for certain mdaps 
        past milestone b.--
                    (A) Prohibition.--If a military department fails to 
                obtain an audit with an unqualified opinion on its 
                financial statements for fiscal year 2017, effective as 
                of the date of the issuance of the opinion on such 
                audit, amounts may not be expended by the military 
                department for a weapon or weapon system or platform 
                being acquired as a major defense acquisition program 
                for any activity beyond Milestone B approval unless 
                such program has already achieved Milestone B approval 
                of the date of the issuance of the opinion on such 
                audit.
                    (B) Definitions.--In this paragraph:
                            (i) The term ``major defense acquisition 
                        program'' has the meaning given that term in 
                        section 2430 of title 10, United States Code.
                            (ii) The term ``Milestone B approval'' has 
                        the meaning given that term in section 
                        2366(e)(7) of title 10, United States Code.
    (b) Department of Defense.--If the Department of Defense fails to 
obtain an audit with an unqualified opinion on its financial statements 
for fiscal year 2017, the following shall take effect, effective as of 
the date of the issuance of the opinion on such audit:
            (1) Reorganization of responsibilities of chief management 
        officer.--
                    (A) Position of chief management officer.--Section 
                132a of title 10, United States Code, is amended to 
                read as follows:
``Sec. 132a. Chief Management Officer
    ``(a) In General.--(1) There is a Chief Management Officer of the 
Department of Defense, appointed from civilian life by the President, 
by and with the advice and consent of the Senate.
    ``(2) Any individual nominated for appointment as Chief Management 
Officer shall be an individual who has--
            ``(A) extensive executive level leadership and management 
        experience in the public or private sector;
            ``(B) strong leadership skills;
            ``(C) a demonstrated ability to manage large and complex 
        organizations; and
            ``(D) a proven record in achieving positive operational 
        results.
    ``(b) Powers and Duties.--The Chief Management Officer shall 
perform such duties and exercise such powers as the Secretary of 
Defense may prescribe.
    ``(c) Service as Chief Management Officer.--(1) The Chief 
Management Officer is the Chief Management Officer of the Department of 
Defense.
    ``(2) In serving as the Chief Management Officer of the Department 
of Defense, the Chief Management Officer shall be responsible for the 
management and administration of the Department of Defense with respect 
to the following:
            ``(A) The expenditure of funds, accounting, and finance.
            ``(B) Procurement, including procurement of any enterprise 
        resource planning (ERP) system and any information technology 
        (IT) system that is a financial feeder system, human resources 
        system, or logistics system.
            ``(C) Facilities, property, nonmilitary equipment, and 
        other resources.
            ``(D) Strategic planning, and annual performance planning, 
        and identification and tracking of performance measures.
            ``(E) Internal audits and management analyses of the 
        programs and activities of the Department, including the 
        Defense Contract Audit Agency.
            ``(F) Such other areas or matters as the Secretary of 
        Defense may designate.
    ``(3) The head of the Defense Contract Audit Agency shall be under 
the supervision of, and shall report directly to, the Chief Management 
Officer.
    ``(d) Precedence.--The Chief Management Officer takes precedence in 
the Department of Defense after the Secretary of Defense and the Deputy 
Secretary of Defense.''.
                    (B) Conforming amendments.--
                            (i) Section 131(b) of title 10, United 
                        States Code, is amended--
                                    (I) by striking paragraph (3);
                                    (II) by redesignating paragraph (2) 
                                as paragraph (3); and
                                    (III) by inserting after paragraph 
                                (1) the following new paragraph (2):
            ``(2) The Chief Management Officer of the Department of 
        Defense.''.
                            (ii) Section 132 of such title is amended--
                                    (I) by striking subsection (c); and
                                    (II) by redesignating subsections 
                                (d) and (e) as subsections (c) and (d), 
                                respectively.
                            (iii) Section 133(e)(1) of such title is 
                        amended by striking ``and the Deputy Secretary 
                        of Defense'' and inserting ``, the Deputy 
                        Secretary of Defense, and the Chief Management 
                        Officer of the Department of Defense''.
                            (iv) Such title is further amended by 
                        inserting ``the Chief Management Officer of the 
                        Department of Defense,'' after ``the Deputy 
                        Secretary of Defense,'' each place it appears 
                        in the provisions as follows:
                                    (I) Section 133(e)(2).
                                    (II) Section 134(c).
                            (v) Section 137a(d) of such title is 
                        amended by striking ``the Secretaries of the 
                        military departments,'' and all that follows 
                        and inserting ``the Chief Management Officer of 
                        the Department of Defense, the Secretaries of 
                        the military departments, and the Under 
                        Secretaries of Defense.''.
                            (vi) Section 138(d) of such title is 
                        amended by striking ``the Secretaries of the 
                        military departments,'' and all that follows 
                        through the period and inserting ``the Chief 
                        Management Officer of the Department of 
                        Defense, the Secretaries of the military 
                        departments, the Under Secretaries of Defense, 
                        and the Director of Defense Research and 
                        Engineering.''.
                    (C) Clerical amendment.--The table of sections at 
                the beginning of chapter 4 of such title is amended by 
                striking the item relating to section 132a and 
                inserting the following new item:

``132a. Chief Management Officer.''.
                    (D) Executive schedule.--Section 5313 of title 5, 
                United States Code, is amended by adding at the end the 
                following:
            ``Chief Management Officer of the Department of Defense.''.
                    (E) Reference in law.--Any reference in any 
                provision of law to the Chief Management Officer of the 
                Department of Defense shall be deemed to refer to the 
                Chief Management Officer of the Department of Defense 
                under section 132a of title 10, United States Code (as 
                amended by this paragraph).
            (2) Jurisdiction of dfas.--
                    (A) Transfer to department of the treasury.--
                Jurisdiction of the Defense Finance and Accounting 
                Service (DFAS) is transferred from the Department of 
                Defense to the Department of the Treasury.
                    (B) Administration.--The Secretary of the Treasury 
                shall administer the Defense Finance and Accounting 
                Service following transfer under this paragraph through 
                the Financial Management Service of the Department of 
                the Treasury.
                    (C) Memorandum of understanding.--The Secretary of 
                Defense and the Secretary of the Treasury shall jointly 
                enter into a memorandum of understanding regarding the 
                transfer of jurisdiction of the Defense Finance and 
                Accounting Service under this paragraph. The memorandum 
                of understanding shall provide for the transfer of the 
                personnel and other resources of the Service to the 
                Department of the Treasury and for the assumption of 
                responsibility for such personnel and resources by the 
                Department of the Treasury.
                    (D) Construction.--Nothing in this paragraph shall 
                be construed as terminating, altering, or revising any 
                responsibilities or authorities of the Defense Finance 
                and Accounting Service (other than responsibilities and 
                authorities in connection with the exercise of 
                jurisdiction of the Service following transfer under 
                this paragraph).

SEC. 10. ENTERPRISE RESOURCE PLANNING.

    The Secretary of Defense shall amend the acquisition guidance of 
the Department of Defense to provide for the following:
            (1) The Defense Business System Management Committee may 
        not approve procurement of any Enterprise Resource Planning 
        (ERP) business system that is independently estimated to take 
        longer than three years to procure from initial obligation of 
        funds to full deployment and sustainment.
            (2) Any contract for the acquisition of an Enterprise 
        Resource Planning business system shall include a provision 
        authorizing termination of the contract at no cost to the 
        Government if procurement of the system takes longer than three 
        years from initial obligation of funds to full deployment and 
        sustainment.
            (3) The Deputy Secretary of Defense (acting in the capacity 
        of Chief Management Officer of the Department of Defense) or a 
        successor official in the Department of Defense (acting in such 
        capacity) shall have the authority to replace any program 
        manager (whether in a military department or a Defense Agency) 
        for the procurement of an Enterprise Resource Planning business 
        system if procurement of the system takes longer than three 
        years from initial obligation of funds to full deployment and 
        sustainment.
            (4) Any integrator contract for the implementation of an 
        Enterprise Resource Planning business system shall only be 
        awarded to companies that have a history of successful 
        implementation of other Enterprise Resource Planning business 
        systems for the Federal Government (whether with the Department 
        of Defense or another department or agency of the Federal 
        Government), including meeting cost and schedule goals.
                                 <all>