Given the urgency of the wars we are in, the daunting global security
environment we will inhabit for decades to come, and our country's economic
problems, we simply cannot afford to move ahead with business as usual.
—Secretary of Defense Robert Gates
Construction in Progress (CIP) is an accounting term referring to the temporary classification of assets under construction. While under construction, costs of new construction and facility improvement projects are accumulated in CIP accounts.
The Real Property Construction in Progress Requirements (CIPR) initiative was launched in 2006 to improve the accuracy and timeliness of CIP cost and project information from construction agents to Components. In support of the President's Management Agenda (PMA) to integrate financial management and business operations, the CIPR initiative is focused on establishing sustainable business processes, management controls, and standardized data elements, across all of DoD.
DoD's current processes for managing and reporting CIP costs do not provide sufficient accountability of construction costs and do not fully comply with federal financial management requirements. Various audit reports highlighted inadequate internal controls and deficiencies in financial reporting, accountability, and documenting of CIP project and cost information.
The CIPR re-engineering effort will provide real-time accountability for DoD's investments in construction projects, enabling accurate and consistent CIP reporting to Congress, project, and financial managers. The CIPR initiative will also help to achieve clean audits.
The CIPR standardized processes, business rules, and data elements were collaboratively developed with DoD Components and their construction agents. A detailed requirements document was approved by the I&E Domain Governance Board and released in October 2006. The requirements were integrated into DoD's Business Enterprise Architecture (BEA) version 4.1. The Components are in the process of developing implementation plans for complying with the new requirements.
The Business Enterprise Integration (BEI) office within I&E is assisting the Components with implementation of the process, data, and system re-engineering efforts required by CIPR. BEI is continually working on new tools and applications that will reduce the Components' change management burdens and help them to implement predictable and auditable business processes. DoD policy revisions are also underway to expedite implementation of CIP requirements.