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Monday, March 20, 2006

Congress questions financial management consolidation

"In the two years since the Office of Management and Budget announced an initiative to consolidate agencies' financial management systems, there has been little indication of progress. Now, Congress is questioning the risks involved in continuing the project - and whether completion is feasible.

As called for in the President' Management Agenda, OMB intends for many financial management operations to be concentrated within shared services centers, where one service provider handles back-office functions for several agencies to save money.

The plan is referred to as the Financial Management Line of Business, one of six federal lines of business. The financial management shared service provider can be a federal agency - referred to as a Center of Excellence - or a private company. OMB wants any department planning a major change in its financial management system to consider using one of the agency COEs or a commercial provider, instead of conducting operations internally.

But last week, lawmakers held a hearing with OMB officials to voice their concerns about the lack of clear guidance on financial management shared services. Rep. Todd Platts (R-Pa.), chairman of the House Government Reform Committee's Government Management, Finance and Accountability Subcommittee, expressed his confusion about the murky guidance governing which agencies must eventually use or become a COE. "

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