Concept of Operations for the DCMA Small Business Center (INFORMATION)

1. Risk Planning

        1.1.  Defense Contract Management Agency (DCMA) personnel should communicate the opportunities of the Mentor-Protégé Program during regular contractor and customer discussions.

         1.2.  Once a Mentor-Protégé Agreement is received and/or included on the OSD Office of Small Business Program (OSBP) list of agreements, the DCMAC-C Mentor-Protégé Division (DCMAC-CP) should include it in planning considerations.  This is because  Agreements are for a term of one to three years with possible extension up to two additional years.

        1.3.  DCMAC-CP personnel will confer with OSD OSBP personnel for validation of the list of active and post agreements to be addressed.

        1.4.  DCMAC-CP reviews the list of agreements, verify the agreements have been received, and advise the Service activities and/or OSD OSBP of any concerns, updates, or omissions in the agreement list.

        1.5. A listing of the mentors and protégés where DCMA does not have administrative cognizance will be provided to the OSD OSBP.

        1.6  The DCMAC-CP Division Chief will advise the OSD OSBP of specific issues with the list of agreements and mentor sites that are not under DCMA cognizance and address reimbursement.

2.  Risk Assessment
        2.1.  Receive and review the Mentor-Protégé agreement, the Mentor quarterly report, and the DoD semi-annual  reports. 

        2.1.1  Agreements approved before Oct 1, 2005:   Two quarterly reports are to be submitted by the mentor two weeks after the close of the period.  Two DoD semiannual reports are to be submitted by the mentor for the following periods of performance: October 1 through March 31and April 1 through September 30 of each FY.  The DoD semiannual reports should be received by the DCMAC-CP Program Manager no later than April 30 and October 31.

        2.1.2   Agreements approved after Oct 1, 2005:   Two quarterly reports are to be  submitted by the mentor two weeks after the close of the period.  Two DoD semiannual reports are to be submitted by the mentor at the six and twelve month timeframe.  All reports are due based on the approval date or contract funding date for the specific period of performance of the agreement.  The DCMAC-CP Program Manager verifies that the mentor's most current completed semi-annual report is obtained, including the protégé's concurrence/rebuttal to the  report, and reviews all documents prior to the scheduled review.  The DCMAC-CP Program Manager notifies the Mentor of the required submission prior to their due dates and reaffirms the final receipt date.  The DCMAC-CP Program Manger ensures all sections are complete.

      2.2.  Risk assessment includes determining what type of audit or review should be performed based on the risk rating.   Risk ratings should be determined, in part, by considering the type of agreement (Reimbursable or Credit), the year of the Mentor-Protégé Agreement,  assessing the quarterly reports and the prior year performance (if applicable).  Risk assessment also includes consideration of whether there is an advance agreement on the treatment of development costs for either credit or reimbursable agreements.  The following are approaches to risk assessment:

• High Risk:  On-site reviews should be scheduled within 60 days of high-risk determination.  
• Moderate Risk: On-site reviews should be scheduled within the review period for reimbursable          agreements and virtual reviews for credit agreements.
• Low Risk:  Either virtual or on-site performance reviews should be scheduled, as deemed                necessary.  Verification of data and progress is still required although interviews                                       may be telephonic.

     2.3.  The DCMAC-CP Program Manager will establish a schedule for the mentor and protégé reviews with completion dates for their assigned workload.   Mentor-protégé performance reviews should be coordinated with other on-site activities to maximize field resources.  The DCMAC-CP Program Manager should schedule discussions with each protégé, for the purpose of validating the data and effort for the given FY under the Mentor-Protégé agreement.  The DCMAC-CP Program Manager will request a Defense Contract Audit Agency (DCAA) audit for all reimbursable agreements.  The DCMAC-CP Program Manager assesses whether a meeting with the Mentor and the Protégé is required or if a virtual review should suffice.

    2.4.  The DCMAC-CP Program Manager advises the Mentor of the review schedule in order to facilitate the review process and avoid undue delays.

    2.5.  The DCMAC-CP Program Manager performs the review of the protégé, reviewing the semi-annual report for completeness and verifies the progress made by the protégé during the developmental period of the agreement.  Feedback information from the protégés on how the agreement is proceeding, including verification of milestone achievement should be solicited  and included in the annual report.  For example, if the protégé reports that no benefits were obtained from the agreement and the mentor reports incurring $500,000 in costs, then this   inconsistency should be highlighted in the report for further review.

    2.6.  The DCMAC-CP Program Manager should utilize the Defense Contract Audit Agency (DCAA), to verify the reimbursable and credit agreement costs or credits reported by the mentor in year one at a minimum and every year thereafter should the Mentor-Protégé Agreement be rated as either moderate or high risk.   All Mentor-Protégé Agreements should have a DCAA audit to determine the total final costs or credits incurred.

    2.6.1.  The results of the protégé review should be provided to DCAA when requesting audit assistance. 

    2.6.2.  Audits performed determine if costs or credits were reasonably incurred as reported by the mentor in the semi-annual report.  The DCMAC-CP Program Manager determines whether costs or credits are allocated in accordance with the mentor's approved accounting practices.

    2.7.  The DCMAC-CP Program Manager should conduct an annual on-site exit conference on the state of the Agreement with the mentor at the conclusion of the review or during the reporting period for all Agreements rated moderate or high risk.  We do this to discuss findings prior to the final report.  Telephone exit conferences may be appropriate for Agreements rated as low risk.  The details of the exit conference and recommendations for corrective action should be included in the Annual Review and Executive Summary for DoD Mentor-Protégé Agreements.

    2.8.  If problems are noted in the quarterly reports, semi-annual report or DCAA audit, the DCMAC-CP Program Manager should work with the mentor to assist in resolving problems,  except for Agreements where DCMA has no administration of the underlying contract.  For these Agreements, DCMA should submit the facts in the report with recommendations for corrections.

    2.9.  The DCMAC-CP Program Manager will notify the cognizant Service Activity and the DCMAC-CP, Mentor-Protégé Division Chief of issues impacting the Mentor-Protégé Agreement.

    2.10   The DCMAC-CP Program Manager should also verify the accuracy of protégé data on employment, revenues, and participation in DoD contracts for the two year period after the developmental period ends utilizing the Protégé Post Agreement Review Form.  If data is either  not provided, or is not verifiable, the report should still be completed outlining the reason that such verification could not be performed.  The report period is for two consecutive years starting with the end date of the agreement .  Does not apply to Protégés that enter another agreement with a new Mentor or agreements that have been terminated.

    2.11.  Proposed Credit Agreements will be reviewed for completeness and returned for any additional documentation, if required, within ten working days of receipt from the Mentor.

    2.12.  Approval Letters will be sent to Mentor, OSD, OSBP and DCMAC-CP Program Manager within thirty days of receipt of complete package.

3.   Risk handling is the process that identifies, evaluates, selects, and implements options in order to set risk at acceptable levels given program constraints and objectives.  The DCMAC-C Mentor-Protégé Division performs risk planning, assessing, monitoring and documenting, while contractors do the risk handling, because it is their process(es) that has to be changed in order to mitigate risk.  DCMA's role in contractor risk handling is one of influence rather than control.  Therefore, the DCMAC-CP Program Manager should ensure that their assessments are well founded and provide good reason for the supplier to voluntarily act on these assessments.

4.  Risk Monitoring
    
    4.1. The Mentor-Protégé Division Chief and Program Mangers will review mentor reports and protégé responses to determine if corrective actions are required.

    4.2. The DCMAC-CP Mentor-Protégé Division Chief and the Program Manager ensures all parts of the Annual Review and Executive Summary for DoD Mentor-Protégé Agreements are completed.  The DCMAC-CP Program Manger makes sure the review package is complete and contains all the information required as oulined in the instructions (Instruction Sheet).  The DCMAC-CP Program Manger signs the review and routes through the Mentor-Protégé  Division Chief for approval prior to making final distribution. 

    4.3.  Once review approval is obtained, the DCMAC-CP Program Manager distributes the review packages  to OSD OSBP, DCMAC-CP, and applicable agencies.   All reimbursable reviews should be distributed no later than 3 weeks prior to funding requirements and credit agreements two weeks prior to end of performance period or an earlier date as established by the Mentor-Protégé Division Chief.                       

5. Risk Documentation
     
    5.1.  The DCMAC-CP Program Manager should record and maintain documentation on risk assessments, risk handling and risk monitoring results and update as applicable. 

    5.2.  The DCMAC-CP Division Chief and Program Manager  should maintain a listing or  spreadsheet of the dates of reviews scheduled and when the corresponding reports are received and approved.   They should prepare an executive summary of the performance of the annual review requirement and make recommendations for improvement.

    5.3.  DCMAC-CP will follow-up with the OSD OSBP and other customers, as required, to enhance DCMA's service to our customers in support of the Mentor-Protégé Program.