PPBE Reform Commission

Proposed Legislative Language in Support of Implementation of the Final Report Recommendations

Recommendation 12: Review and Update PPBE-Related Guidance Documents

Description and Justification: The Commission recommends the review and update of PPBE guidance documents, including the 7,300+ page Financial Management Regulation (FMR). Unclear guidance creates undue workload burden and confusion and often delays actions necessary to support modern warfighting requirements. Clear, consistent, and current guidance that reflects modern financial practices enables efficient and effective decision-making at the lowest levels. Systematic and comprehensive updates and revisions of the FMR will provide more useful and timely resources to DoD managers. See page 89 of the Final Report for additional information.

SEC. __. Revision of Department of Defense Financial Management Regulation.

(a) The Under Secretary of Defense for Comptroller shall revise the Department of Defense Financial Management Regulation 7000.14-R not later than September 30, 2026, to:
(1) Provide updated guidance for current legislative and regulatory requirements.
(2) Streamline and deconflict guidance throughout the Financial Management Regulation to ensure consistency and clarity.
(3) Remove outdated guidance and guidance subject to change annually with the annual appropriation act.
(b) Considerations. —In conducting the revision, the Under Secretary shall:
(1) Prioritize clarity and accessibility in the language and direction provided, including improvements to the coordination and approval process for recommended changes.
(2) Review and adopt modern financial practices that better align to current development and production cycles.
(3) Minimize specific guidance subject to annual amendment in appropriation acts and associated documents while referencing relevant congressional action.
(4) Consider information technology solutions to improve the accessibility and usability of the Financial Management Regulation.
(5) Consider the recommendations of the Commission on Planning, Programming, Budgeting, and Execution Reform.
(c) Briefing. —Not later than February 1, 2025, and every 180 days thereafter, the Under Secretary of Defense for Comptroller in coordination with the Service Comptrollers shall provide to the congressional defense committees a briefing on the efforts to update the Financial Management Regulation, including a description of—
(1) The progress in updating the Financial Management Regulation;
(2) Plan and timeline for completing revisions to the Financial Management Regulation;
(3) Any barriers to the ability of the Department of Defense to update the Financial Management Regulation as directed;
(4) Any legislative amendments required to complete revisions of the Financial Management Regulation; and
(5) Any other information deemed relevant by the Under Secretary.
(d) Notification. —The Under Secretary shall notify the congressional defense committees not later than 10 days after completing the revisions required by this provision.
(e) Subsequent Review. — Following the review required under (d), the Under Secretary shall:
(1) Conduct a comprehensive review of the Financial Management Regulation not less than every two years after fiscal year 2027; and
(2) Notify the congressional defense committees of the completion of the comprehensive review with the budget submission.