CDFM Working Capital Fund Management

Question 1

What is the primary purpose of a Department of Defense Working Capital Fund (WCF)?

Accepted Answer

To provide a revolving source of financing for goods and services provided to customers

Answer

WCFs are revolving funds that finance the cost of goods and services provided to DoD and other customers, with revenues replenishing the fund as charges are collected.

Question 2

Which DoD instruction primarily governs Working Capital Fund financial management policies?

Accepted Answer

DoDI 7000.14-R (DoD Financial Management Regulation)

Answer

DoDI 7000.14-R, the DoD Financial Management Regulation (FMR), Volume 11B specifically addresses WCF policies and procedures.

Question 3

What is a 'stabilized rate' in the context of DoD Working Capital Funds?

Accepted Answer

A fixed price charged to customers for an entire fiscal year to provide budget stability

Answer

Stabilized rates are prices set at the start of the fiscal year that remain constant, allowing customers to budget reliably without mid-year price fluctuations.

Question 4

Which of the following is a major business area of the Defense-Wide Working Capital Fund?

Accepted Answer

Defense Finance and Accounting Service (DFAS)

Answer

DFAS is a Defense Agency activity funded through the Defense-Wide Working Capital Fund, providing finance and accounting services on a reimbursable basis.

Question 5

How are WCF operating results that generate a 'net operating loss' typically addressed?

Accepted Answer

They are recovered through rate adjustments in future fiscal years

Answer

WCF losses are recovered by adjusting stabilized rates in future years so that the fund recoups the deficit over time without needing a separate appropriation.

CDFM - Certified Defense Financial Manager Practice Test

CDFM - Certified Defense Financial Manager Practice Test

CDFM Working Capital Fund Management