FINANCIAL MANAGEMENT POLICY MANUAL

ased will be funded by the Shipbuilding and Conversion, Navy
(SCN) appropriation for those ships appropriately funded by the SCN
account.
6. SPECIAL SITUATIONS
a. General.
Depending upon actual program circumstances, certain types of costs
may be funded either by RDT&E,N or other appropriations.
Therefore, each Program/Budget proposal made in accordance with
these instructions will be subject to review and determination. Special
situations in this category are discussed in the following
subparagraphs.
b. Test Articles.
Whenever an appropriate number of test articles for an item under
development has been financed by the RDT&E,N appropriation, and
subsequently, additional test articles become necessary to complete
the DT&E and/or IOT&E program, then articles from approved initial
production financed by procurement appropriations may be assigned
to the test program. Costs to reconfigure the articles, first for test and
subsequently for restoration, are financed by the RDT&E,N
appropriation. Articles which will be consumed in T&E and cannot be
reconfigured for the inventory are also financed by the RDT&E,N
appropriation. Conversely, articles/prototypes for T&E financed by
the RDT&E,N account and still available at the completion of the
IOT&E test program may be reassigned for operational use or
inventory, in which case the cost to reconfigure such articles for
operational use is financed by the Operation and Maintenance or
Procurement appropriations, as appropriate.
c. Production Tooling Facilities.
When an end item under development has also been approved for
production, hard tooling and production facilities requirements
common to both the development and production phases will be
financed by Procurement appropriations. When an end item under
development has not been approved for production, tooling and other
preliminary production facilities required to produce realistic
development hardware for test and evaluation will be financed by the
RDT&E,N appropriation, even though such tooling and facilities
might later be used in whole or part for production if and when the
item is subsequently approved for production.
d. Off-the-Shelf Equipment Redesign.
While existing off-the-shelf equipment may be procured with
Procurement appropriations, items which require engineering, design,
Financial Management Policy
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