ABC/M Methodology FAQs

1. How does the ABC Model deal with prior year funds?
2. If we are supposed to select ABC codes based on actual work, how do costs get to ultimate outcome (i.e., performance)?
3. Can I see budget object classes (BOCs) for Labor costs?
4. What do NEFO and NEFP mean?
5. Why can't the ABC system be used to capture costs for all my projects?
6. Why can't we just submit quarterly reports of what work has been done in each office instead of coding all out time and expenses?
7. Why don't the salary costs per person exactly match what that person is paid?
8. What costs are not in the ABC data?
9. What is the difference between "Program" and "Subactivity Program" in the ABC models?

1. How does the ABC Model deal with prior year funds?

Prior year funds appear in the ABC data when they are expended as costs. The prior year funds are charged to a prior year ABC code, and this cost is then cross-walked by Finance to the equivalent current year ABC code. For example, prior year funds from FY 2005 have an FY 2005 ABC code associated with them. If some of these funds are expended in FY 2006, this FY 2005 ABC code is cross-walked to the equivalent FY 2006 code and the costs show up in the FY 2006 models.

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2. If we are supposed to select ABC codes based on actual work, how do costs get to ultimate outcome (i.e., performance)?

FWS and DOI are using ABC to collect data on the cost of doing work and aligning these costs with performance data. In the ABC system all work activities are mapped to the Service's Critical Success Factors, which roll-up to the FWS Operational Goals, on up to the DOI Mission Components. This mapping is unique for each program in the Service. The mapping of ABC activities to Performance Goals is available online here. The construction of this activity to performance goals mapping involved a rigorous process involving the collaboration of the ABC implementation team with representatives from each Program in the Service.

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3. Can I see budget object classes (BOCs) for Labor costs?

No, the ABC models currently do not contain BOCs for labor costs. This was a decision the ABC team made in developing the model methodology. We did not think this level of detail was needed in building the models.

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4. What do NEFO and NEFP mean?

NEFO stands for "No Employee Found in Organization" and NEFP stands for "No Employee Found in Payroll." These acronyms are used to describe a situation where an Organization has labor costs, but no associated labor resources (i.e., people) in the source data files. Therefore, these labor costs remain in the Resource module of the ABC models and are not driven to the Activity or Cost modules.

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5. Why can't the ABC system be used to capture costs for all my projects?

The ABC system does capture costs associated with all projects, however it does not report costs at the project code level. It is possible to track costs at the project code level using the Finance system.

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6. Why can't we just submit quarterly reports of what work has been done in each office instead of coding all out time and expenses?

The Department requires that all employees directly code their time to ABC work activities. The Service investigated using an employee survey to collect costs but found that we would be in violation of DOI policy if we implemented such a system.

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7. Why don't the salary costs per person exactly match what that person is paid?

It is important to keep in mind that the ABC system is not intended to mirror the Financial system. That being said, there are two reasons why salary costs per person in the ABC models don't match exactly what that person is paid. Both of these reasons are associated with the methodology used to construct the ABC models.

First, labor costs are allocated to each employee within an organization based on the proportion of salary that they represent for that Organization. To do this allocation, we make the assumption that each employee is a Step 5 for their respective GS level. Therefore, for those employees that are higher than a Step 5 we are probably under-reporting costs by a small margin and for those that are lower than a Step 5 we are probably over-reporting costs by a small margin.

Second, in building the ABC models, each employee's costs are located in a single organization regardless of whether that employee actually had costs in multiple organizations. Therefore, for those employees that have costs in multiple organizations, costs may differ from actual salary costs.

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8. What costs are not in the ABC data?

The ABC Models include expenses rather than obligations. Certain types of expenses are excluded from the models each quarter. Therefore, the ABC cost data included in the model is a subset of all the Service's expenditures. To illustrate the types of expenses that are excluded, we will view the data for FY 2006 Quarter 2. The table below details the costs included in the model for FY 2006 Quarter 2, beginning with an extract from the Federal Financial System (FFS) of General Ledger Expense accounts 4901 and 4902 and ending with the final total for the ABC model.

In the example below, the total dollar amount from the FFS extract totaled $634.9 million for FY 2006 Quarter 2. From this amount, the team deducts the costs for Budget Object Class codes (BOCs) associated with construction costs, grants, and capitalized expenses. For a list of all excluded BOCs, click here. The second step in the process is to remove all transactions that are associated with non-expense transaction codes. These transaction codes consist of accounting entries and cash receipts. Lastly, the team removes all transactions associated with FFS and Fleet (FLT) coordinator Organization codes. These Organization codes are not valid in the model, as they are not truly operating Organizations. After removing these costs, the total for FY 2006 Quarter 2 is $356.6 million. Because of inconsistencies between Organizations in FFS and FPPS, there are additional costs excluded from the ABC models. For Quarter 2, these costs totaled $1.541 million and resulted in a final model total of approximately $355 million. Each quarter, the team uses the same process to filter the data and exclude these costs.

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9. What is the difference between "Program" and "Subactivity Program" in the ABC models?

"Program" refers to the programs that make up the organizational structure of the Service. These include Budget, Planning, and HR, Business Management and Operations, Endangered Species, etc.

"Subactivity Program" refers to the budgetary programs that are used in allocating funds for the Service. Most 4-digit budget subactivity codes roll-up to a "Subactivity Program designation." These programs include Central Office Operations, Coastal Programs - HC, Endangered Species, etc. Typically, most analysis will involve using the "Subactivity Program" dimension since this is the entity to which funds are budgeted.

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