What is cross-leveling in Foreign Military Sales?

Cross-leveling is an accounting technique by which DFAS-IN transfers funds from one FMS case to another for the same country. This transfer permits the international partner to minimize payments due on a billing by fully utilizing all funds previously paid on FMS cases. There are two methods through which cross-leveling may be accomplished. In the first method, the international partner conducts a cash analysis and, in a letter (usually with a payment), requests DFAS-IN make specific cash transfers among designated FMS cases. The second method authorizes automatic cross-leveling between cases based upon case needs. In this method, there must be a detailed written agreement between DFAS-IN and the international partner to document the transaction authorization(s). In order to provide the international partner with a complete record of cross-leveling transactions, the transfer of excess cash is processed to the country holding account and then withdrawn from the holding account to be applied to a case requiring payment.