Air Force finds success using e-invoices

The Pacific Air Forces and the Air Force's Education and Training Command are piloting an e-commerce application that aims to simplify how they pay contractors.

The Wide Area Workflow app created by the Defense Department eliminates paper forms and invoices, said Bruce S. Lemkin, principal deputy assistant secretary for financial management.

'Doing this process electronically eliminates the chance that invoices and receiving reports are delayed or lost in the mail,' the Pentagon Air Force official said in a statement. 'It also reduces the processing cycle time, speeding up payments to vendors.'

DOD chose the Air Force to evaluate the program. The tests by users at the training command and at bases that make up the Pacific organization have reduced interest penalty and late payments by the service, Lemkin said.

At the training command, the Air Force cut its interest penalties to $106 per $1 million, almost 50 percent less than the Air Force-wide average of $200 per $1 million. For the Pacific Air Forces pilot participants, interest penalties dropped more dramatically, to $8.66 per $1 million, Lemkin said.

'That's tens of millions of dollars of taxpayers' money that we're saving,' Lemkin said.

The early success of the pilots prompted DOD in April to announce that it is now mandatory for contractors to submit payment requests electronically. Click to link to April 7, 2003 GCN coverage

The Defense Federal Acquisition Regulation Supplement directs contractors to use one of three Wide Area Workflow Receipt and Acceptance electronic forms to submit invoices and reports.

Contractors can receive an exemption from the rule if they are unable to submit, or DOD is unable to receive, an invoice in electronic format. But in each case, the contracting officer, payment office and contractor must agree to an alternative method.

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