FINANCIAL MANAGEMENT POLICY MANUAL

equirements basis, approaches the DON goal.
Contract Design Costs - The phase of shipbuilding programs,
following preliminary design, to produce a design, which carries the
equipment specifications necessary to meet the DON requirements.
Detail Design Costs - The final design effort on ships normally
performed in conjunction with lead-ship construction.
Approval for Production - The major milestone in a development
program which represents the formal approval of an item for
production for operational use by the Service forces. In some
instances items are approved for production with qualifying
restrictions or provisions pending correction of specific development
deficiencies. In such instances the cost of funding the correction and
test must be determined on a case-by-case basis. Typically, all postproduction
approval effort will be funded in the Procurement
appropriations.
Unique Joint Test and Evaluation (JT&E) Costs - JT&E costs such as:
feasibility determination of proposed joint tests; the provision for test
design and planning support for joint tests selected; the development,
procurement, installation, and operation of special instrumentation;
transportation, travel, and per diem costs for the Test Director's staff;
the modification of test articles as surrogates and to permit obtaining
test data; transportation of equipment from permanent bases to the test
site and return; and the provision for data collection/collectors, data
reduction, analysis, and test reporting services. Transportation and per
diem of participating personnel and maintenance and supply costs are
not considered unique.
Performance Envelope - The demonstrated capability of a system,
system components and special purpose software to perform its
mission in relation to essential characteristics such as: speed, range,
payload, altitude, rate of fire, etc.
3. COST FUNDED BY RDT&E,N.
Generally, all RDT&E-related effort should be funded in the RDT&E,N
appropriation so that it can be assessed from a priority standpoint with
other research and development programs. Gray areas are to be resolved
in favor of RDT&E funding. Contractual Services and other costs, such as
Government personnel, supplies, material, equipment and instrumentation
are included.
a. General.
The conduct and support of RDT&E includes basic research, applied
research, theoretical studies, scientific experiments, feasibility studies,
design studies, engineering studies, related weapon studies, operational
Financial Management Policy
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