text: Chapter 5
  WORKING ESTIMATE
  5-77. HQDA formulates the working estimate that builds on the budget estimates centered on actual
  execution of the operational plan based on data provided by the respective component commands.
  These estimates are revised/updated formally on a quarterly basis (through the Quarterly Contingency Cost
  Estimate Report) and reported to OUSD(C). Senior FM planners within HQDA developed cost models
  such as the Army Contingency Operations Cost Model (ACM) and the FCM to support their cost estimate
  development and can tailor these models to specific theater conditions in order to better align requirements
  to costs. DOD FMR Volume 12, Chapter 23 contains more information on all three estimates.
  CONTINGENCY COST REPORTING
  5-78. Cost reporting is an integral part of the Army‘s stewardship. Financial managers throughout all levels
  of FM operations – from strategic to tactical – must diligently capture and accurately report the cost of the
  contingency operation. The Army is required to report the obligation of all funds (regardless of source) to
  cover the incremental costs of the contingency, including funds received in a supplemental appropriation.
  HQDA will publish guidance to cover Army-specific items for cost reporting, under DOD FMR Vol. 12
  chapter 23, and validating monthly reporting. The guidance will include information regarding the cost data
  source, validation requirements, and variance analysis procedures.
  5-79. Costs related to a contingency operation may be incurred both in the area of responsibility and in
  other locations. At the operational and tactical levels, it is the responsibility of the unit or activity that
  directly or indirectly incurs costs in support of the operation to ensure that information on all costs is
  transmitted to the appropriate HQDA senior financial manager. The ASCC prepares and submits to HQDA
  the Major Command Monthly Contingency Cost Estimate Report. These monthly reports identify changes
  to cost estimates. The reports facilitate regular communication between the ASCC headquarters and its
  subordinate commands that have responsibility for execution during various contingency operations. The
  ASCC headquarters staff use the data submitted to prepare the Quarterly Contingency Cost Estimate Report
  in accordance with the DODFMR Volume 12, page 23-12.
  5-80. In developing contingency cost estimates and for contingency cost reporting, financial managers
  consider and report only the incremental costs of the operation. Incremental costs are those costs that are
  beyond baseline training, operations, and personnel costs. Incremental costs do not include the cost of
  property or services acquired by the Army that was paid for by a source outside the department or out of
  funds contributed by such a source. The costs of investment items, construction costs, and costs incurred to
  fix existing shortcomings can be categorized as incremental cost if the expenditures were necessary to
  support a contingency operation and would not have been incurred in that fiscal year in the absence of the
  CONOP. Costs incurred beyond what is reasonably necessary to support a CONOP cannot be deemed
  reimbursable incremental expenses, since such costs are not directly attributable to support of the operation.
  Incremental costs may be recorded against supplemental funding, baseline funding, or any source of funds.
  Base budget funding diverted to pay incremental costs in support of contingency operations are not the
  same as baseline costs. The following are examples of allowable incremental costs:
  * Military entitlements such as premium pay, hazardous duty pay, family separation allowance, or
  other payments made over and above the normal monthly payroll costs.
  * Increases for allowances due to changes in geographic assignment area due to a contingency
  (i.e., Basic allowance for subsistence (BAS) or basic allowance for housing (BAH)).
  * Travel and per diem of active military personnel and costs of Reserve Component personnel,
  called to active duty by a federal official, who are assigned solely to support the contingency.
  * Overtime, travel, and per diem of permanent DOD civilian personnel in support of a
  contingency.
  * Wages, travel, and per diem of temporary DOD civilian personnel hired or assigned solely to
  perform services supporting the operation.
  * Transportation costs of moving personnel, material, equipment, and supplies to the contingency
  or contingency staging area, including such things as port handling charges; packing, crating and
  handling charges; first and second destination charges.