The current procedures for determining liability for property loss and damage have proven to be insufficient. Applying modern technology to the process will help the Army more effectively deter property loss. From 2005 to 2006, the Army experienced a 17-percent increase in lost, damaged, or destroyed (LDD) equipment. In 2007, this trend continued with an alarming 36-percent increase in LDD equipment. In fact, since the introduction of the Financial Liability Investigation of Property Loss (FLIPL) process, the Army has almost doubled the rate at which accountability is being lost.
And why should it not double? The word is out: Soldiers and leaders have finally learned that the FLIPL process is virtually useless as a deterrent to property loss. With chapter 13 of Army Regulation (AR) 735–5, Policies and Procedures for Property Accountability, packed with 63 pages of dense legal-ese, just learning how to process a FLIPL is a daunting task—never mind trying to master the process in a combat zone. Soldiers have learned that they have two choices when a piece of equipment comes up missing.
They can sign a statement of charges (SOC) and pay a de-preciated value of the missing equipment, or they can deny responsibility and stick some staff officer with the task of trying to prove their liability by processing a FLIPL. What does the Soldier pay if he is found fi-nancially liable for the missing equipment? He pays exactly the same amount as he would have paid under the SOC. For the Soldier, the smart choice is clear: Go with the FLIPL every time. The FLIPL process is strictly manual. The Army offers S–4s no tools for making FLIPL management easier.
AR 735–5 states nine times that all entries must be made on the original Department of Defense (DD) Form 200, Financial Liability Investigation of Property Loss. So, S–4 shops keep typewriters handy and clerks busy with administrative tedium. To make the FLIPL an effective deterrent to prop-erty loss, the Army must improve the way the process leverages technology. By creating a web-based FLIPL processing tool, technology can be used to connect participants, automate repetitive processes, and standardize the execution of FLIPLs.
These applications should work together in one tool that interfaces with Property Book Unit Supply Enhanced (PBUSE) and the Defense Finance and Accounting Service (DFAS). The tool could be either a sub-module of PBUSE or a stand-alone system. By tying into PBUSE, the property book officer would be able to assign a document number and track the status of the FLIPL without having to develop his own database. By connecting with DFAS, the command would be able to ensure that service members found to be financially liable are held financially liable before the FLIPL is forgotten by the command. Connecting Participants
One of the biggest challenges of processing FLIPLs is the large number of people involved in reaching a decision. A FLIPL for which financial liability is determined will be touched by at least 11 individuals, including the initiator, the respondent, the responsible officer, the property book officer, the appointing authority, the approving authority, the investigating officer, the legal reviewing officer, the respondent’s attorney, the unit personnel administrator, and a finance officer. In reality, the number of people involved in the FLIPL can be even higher depending on the complexity of the investigation.
Since all of these people need to communicate with each other about a common document, communication can become complicated and bogged down. Experience shows that communication gaps seem to be the main reason for delays in FLIPL processing. To resolve this difficulty, an automated FLIPL process should make use of participants’ Army Knowledge Online (AKO) email addresses to automatically communicate with one another. For example, once the investigating officer has completed his findings, all he would need to do is click a submit button to have his results automatically forwarded by email to the appointing authority.
This process could also make use of digital signatures to avoid the need to have each participant physically sign the FLIPL. Using AKO to communicate with participants would eliminate the need to send Soldiers certified return receipt mail. The minimum cost for a 1-ounce first class certified letter with a return receipt is $5. 21. Since a Soldier who is held financially liable is notified at least twice (once by the investigating officer and once by the approving authority), every finding of financial liability costs the Army $10. 2 in postage. Eliminating the need to use “snail mail” would speed up communication and reduce costs. A final application of technology to improve communication in the FLIPL process should be to provide management tools to enable effective oversight of the FLIPL process. While this would most likely take the form of an automated Department of the Army Form 1659, Financial Liability Investigation of Property Loss Register, other reports could be provided to categorize the FLIPLs by age, status, or dollar value.
This chart reflects the results of using financial liability investigations to “fix” hand receipts rather than enforcing the proper use of paperwork and inventories. Each year, more and more Army equipment is written off because of inadequacies in the FLIPL process. Automating Repetitive Processes In the course of finding a respondent financially liable, a minimum of six memorandums are created and distributed. These documents include continuation sheets, the appointment of the investigating officer, a notification of the recommendation of financial liability, a notification of finding of financial liability, and others.
It would be easy for a web-based FLIPL processing system to automatically create these documents based on data provided by the participants. For example, once the appointing authority selects an investigating officer, the information he provides about the investigating officer could be used to generate the appointment memorandum for the investigating officer. This automatic document creation function could even go beyond memorandums to include creating mailing labels for certified mailings.
Another area that could easily be automated involves the cost calculations that the initiator and investigating officer are responsible for performing. Not only could the unit price of lost equipment be automatically entered into block 7 (eliminating the risk of math errors), but depreciation calculations could also be performed for the investigating officer. A calculator for determining split liability would be very useful when more than one person is held financially liable.
Finally, exhibit management could be improved by enabling participants in the FLIPL process to upload portable document files (better known as PDF) to the online FLIPL. This would ensure that all participants in the process see the same information and that the information is not lost as a result of poor recordkeeping. This could be taken one step further to assign standard exhibit letters to mandatory FLIPL documents. For example, the appointment of investigating officer memorandum could always have the same exhibit number for all FLIPLs.
Standardizing Execution Since the participants in FLIPLs often change, recommendations tend to vary dramatically depending on the philosophy of the participants. Some initiators provide very little information, while others provide a great deal. Different investigating officers employ different techniques and assign different values to certain pieces of information. And, of course, judge advocate general (JAG) officers commonly disagree on how to interpret AR 735–5. (Once, 35 FLIPLs were given to a board of 6 JAG officers for legal review.
For every single file, at least one lawyer said it was legally sufficient and at least one said it was not. ) To resolve these issues, a web-based FLIPL process could take steps to standardize the execution of the FLIPL. For starters, initiators should be provided with a series of standard questions to help them complete block 9 of the DD Form 200. These questions should include the following: (1) When was the equipment last inventoried? (2) Who had direct responsibility for the property? and (3) What actions were taken by the command to ensure that the property would not be misplaced?
By guiding the initiator to thoroughly communicate the circumstances surrounding the equipment loss, the need for investigating officers can be reduced. This would in turn reduce the time and cost involved in the process. The investigating officer’s performance could also be improved by providing standardized guidance. This could take the form of an online training session that would lead the investigating officer through a presentation of what his duties and responsibilities are and how best to accomplish them.
This initial training session should be followed by a review exam to certify that the investigating officer adequately understands his role. The quality of the investigating officer’s recommendation could also be improved by requiring him to substantiate each element of financial liability (loss, responsibility, proximate cause, and culpability) with a brief explanation of how he arrived at his findings and what exhibits he used to verify those findings. Finally, a web-based FLIPL processing system would enable the Army to centralize legal reviews of FLIPLs.
Instead of having an assortment of JAG officers performing legal reviews of a few FLIPLs each year, a small staff could review all FLIPLs. Not only would this provide consistency in the reviews, it also would encourage consistent performance by the investigating officers. An additional benefit of using a web-based FLIPL processing system would be that legal officers could easily reinvestigate selected FLIPLs that resulted in findings of no financial liability. The current manual FLIPL process fails to take advantage of modern technology.
It consumes an unnecessary amount of manpower and time and results in FLIPLs that have inconsistent findings. These shortcomings encourage Soldiers to use FLIPLs as a quick way to rid themselves of accountability for missing equipment. When units ineffectively process manual FLIPLs, Soldiers become less diligent in securing Government property. Improving the ease and effectiveness of processing FLIPLs will truly create an environment that encourages responsible property stewardship.