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Monday, November 20, 2006

GAO lauds OMB effort to improve government’s financial performance

The Office of Management and Budget should better document its reasons for giving agencies green ratings on its financial performance scorecard, according to the Government Accountability Office.

Overall, GAO praised OMB’s effort in a Nov. 16 report: “The Improved Financial Management Performance Initiative scorecard process has clearly been a catalyst to improve financial management and to encourage agency managers to use financial data to enhance decision making.”

In interviews, agency officials generally said the process made top officials focus on financial management, according to GAO.

But the auditing agency noted that, to award green ratings, OMB must make subjective judgments about how effectively agencies produce financial data and use the data to make decisions. And OMB officials do not thoroughly document how they reach those judgments or track agency documents used in the process.

More documentation would ensure consistency and allow others to learn from the process, GAO said.

In a letter responding to the report, OMB Controller Linda Combs agreed with the recommendations. She said OMB already is developing a tracking system for agency documents. It is also preparing summaries of approved agency plans to show how they meet OMB’s criteria.
Improved financial performance is one of five governmentwide management-reform initiatives that OMB evaluates under the president’s management agenda, launched in 2001 to improve agencies’ efficiency. Other initiatives are competitive sourcing, strategic management of human capital, expanded electronic government, and budget and performance integration. OMB gives agencies ratings of red, for unsatisfactory; yellow, for mixed results; and green, for success.

The report notes that OMB initially refused to give GAO access to agency documents used in the scoring process, because it considered the documents “deliberative and predecisional.” Officials relented after seeing a draft GAO report describing that limitation. But OMB still did not give GAO access to its written comments on agency plans or e-mails and other communications relating to scoring decisions.

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