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Thursday, August 31, 2006

Bush names VA chief information officer

Acting Veterans Affairs Department chief information officer Robert Howard will be nominated to fill the agency's top technology position on a permanent basis, the White House announced Tuesday.

President Bush's nomination of Howard, who also serves as a senior adviser to Deputy VA Secretary Gordon Mansfield, will be subject to Senate confirmation. As acting CIO during a data breach in May that compromised personal information for 26.5 million people, Howard faced congressional investigators on multiple occasions. He has managed VA's Office of Information and Technology since the department's previous CIO, Robert McFarland, left in April.

If confirmed, Howard will be responsible for improving VA's IT security and managing the ongoing centralization of its IT resources under the Information and Technology Office.

NRC is Seeking Options for Shared Service Center Support

A recent request for information issued by the Nuclear Regulatory Commission intends to elicit responses from public and private shared service providers regarding the NRC's options for financial and administrative systems and hosting support outsourcing.

The NRC currently uses a Federal shared service provider (SSP) as the information technology (IT) host and provider of the NRC's core financial system, the Federal Financial System (FFS). This SSP has over 30 years experience successfully servicing administrative systems for over 150 Federal government agencies. FFS is the centerpiece of the NRC financial systems architecture. FFS is a mainframe-based legacy system that the NRC implemented in October 1992 to perform the core financial function for the NRC. Although implemented by the NRC in 1992, FFS was developed more than 20 years ago and is now nearing the end of its extended life cycle. In addition to FFS, the same Federal SSP currently hosts the NRC payroll and human resources system and the NRC e-Travel System. Moreover, the supporting infrastructure including communications links, interfaces, continuity planning, and security are well-established and shared by these applications.

The Federal SSP notified all customer agencies in a March 30, 2006, letter, that the corporate owner of FFS, CGI-AMS, has advised the SSP that FFS is no longer compliant with Federal standards for financial management systems and that they have discontinued any upgrades or enhancements to this system. Therefore, the SSP further advised that they will no longer provide services on FFS effective with the beginning of FY 2011, starting on October 1, 2010. As a result, the NRC must replace its legacy core financial system, FFS, with a modern solution. The NRC is planning to target an implementation date of October 1, 2009. Thus, the NRC is conducting market research to survey the availability of capable hosts, from the commercial and public sectors, of financial systems applications and the specific core financial applications they offer. We are also researching the capability of these same hosts to host Federal payroll, time and labor (T&L), human resources, eTravel, and acquisition/ procurement systems.

Tuesday, August 29, 2006

E-Gov at Five Years: A Pivotal Point

When Bush administration officials launched a series of electronic government initiatives in the fall of 2001, they said the projects would fundamentally change government operations through the application of information technology.

Five years later, the results of the effort are mixed. It's still unclear whether the e-gov projects will become institutionalized as core functions of agency operations or be pushed to the wayside in 2009 as political remnants of the Bush administration.

Now, at what administration officials, agency IT managers and observers describe as a pivotal point for e-gov, the Office of Management and Budget is working to secure its future.
The e-government initiative began as a collection of 24 agency projects, including the Health and Human Services Department's Grants.gov project, the General Services Administration's eTravel effort and the Internal Revenue Service's online tax filing system.

The projects were spread across four categories: government-to-citizen, government-to-business, government-to-government and internal efficiencies and effectiveness. Since then, the administration has added an e-authentication portfolio -- including the effort to develop high-tech identity cards to employees and contractors under Homeland Security Presidential Directive 12 -- and nine "lines of business" initiatives aimed at consolidating agency back-office systems.

OMB has had its share of difficulty selling the e-gov projects in agencies and on Capitol Hill. For example, Congress regularly slashes the administration's request for $45 million for the General Services Administration-managed e-government fund down to $2 million to $3 million. Nevertheless, legislators have appropriated more than $1 billion for e-government initiatives so far.

But now the effort faces its greatest challenge to date, from lawmakers who are less interested in the cultural changes e-gov could bring to federal operations and more concerned about concrete cost savings.

Language in several agency fiscal 2007 appropriations bills would strike financial body blows against e-gov efforts.

Defense gets better on business

DOD’s size, incompatible systems still hinder financial management

With an operating budget in excess of $400 billion, and assets and liabilities that exceed those of Exxon, IBM, Ford and Wal-Mart combined, the sheer size of the Defense Department has created massive challenges for attempts to improve financial management.

But as Congress continues to apply pressure for reform, DOD has made significant strides in several areas, department officials say.

For example, more than 200 business systems have now been certified as effectively modernized, with each modernization saving DOD at least $1 million.

“I believe we’re making real progress,” said Theresa McKay, DOD’s deputy chief financial officer, at a Senate Homeland Security and Government Affairs Subcommittee on Federal Financial Management, Government Information, and International Security hearing on DOD financial management earlier this month.

Electronic bill-paying

Systems modernization has resulted in other cost-savings efficiencies as well. Currently, 95 percent of DOD’s vendor payments now are done electronically, up from 86 percent in 2001, resulting in more than $6 million in savings, according to agency statistics.

And in the area of audit readiness—a long-running weakness for the department—the agency recently completed an accurate and auditable valuation of all of its military equipment.

Since equipment represents 27 percent of all DOD assets, this full valuation is critical, agency officials say.

“This is especially significant, because the department has never before had an accurate valuation of its military equipment,” McKay said.

Indeed, even Government Accountability Office comptroller general David Walker, a frequent critic of DOD’s financial management, has acknowledged some progress on the reform front. At the same Senate hearing, Walker cited DOD’s 2005 issuance of the Financial Improvement and Audit Readiness (FIAR) plan, aimed at improving financial practices. He also praised DOD for recognizing that reform was needed, and for accomplishing some systems modernization.

“The approach that they are taking now is vastly superior to the approach that they were taking before,” Walker told lawmakers.

Yet much work remains, Walker said. He urged DOD to “declare a war on waste” and completely overhaul its legacy information management systems. There are more than 3,000 of these systems still operating at DOD, and their use often requires multiple entries for each procurement transaction, which is highly inefficient, he said.

“There are thousands of outdated, nonintegrated systems that don’t talk to each other. We need to kill or disable all nonessential business information systems,” Walker said.

DOD should switch to a more integrated system by 2012 “at the absolute latest,” he added.

National Weather Service CFO balances today’s spending, future forecasting needs

Though he may be a numbers guy by trade Bob Byrd, the new chief financial officer at the National Weather Service, has always been fascinated by science. He said his interest in the National Oceanic and Atmospheric Administration goes back to a long time.

“Even as a kid I remembered NOAA, going out on the ships on the ocean, seeing the whales and all of that on National Geographic and on public television. There was always an interest there,” he said. “I also had an interest in the weather service and its mission.”
When it comes to missions, Byrd’s career in the federal government has been diverse. It’s included the agency that makes coins, one that tests food safety and now the agency whose mission is to predict and inform the public about the weather.

While Byrd appreciates the differences among the departments he’s worked for, he’s quick to point out the similarities that accompany managing finances and finding efficiencies in any organization inside or outside of government.

Byrd, who previously was chief financial officer at the Food and Drug Administration, spent a few years in the private sector before returning to government and serving as the associate director and chief financial officer at the U.S. Mint. He took over the post at the National Weather Service July 10.

FederalNewsRadio - Ask the CFO - Dale Sopper (SSA)

Dale W. Sopper is the Deputy Commissioner for Budget, Finance and Management at the Social Security Administration (SSA). He is responsible for providing executive leadership and direction in administering: a comprehensive financial program of budget policy, formulation and execution; accounting policy and operations; the Agency's acquisition and grants program; audit resolution and liaison; the internal controls program; Agencywide facilities and publications management programs; and the Agency's efforts to improve Annual Wage Reporting and wage reconciliation activities. Mr. Sopper also serves as SSA's Chief Financial Officer and Principal Deputy Ethics Counselor.

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FederalNewsRadio - Ask the CFO - Clarence Crawford (OPM)

Clarence C. Crawford was appointed at the U. S. Office of Personnel Management (OPM) in November 2002 to serve as Associate Director for Management and Chief Financial Officer (MCFO). In April 2005, M&CFO functions were restructured to place greater emphasis on modernizing OPM's financial management program. As the agency's CFO, Mr. Crawford directs financial management services which include accounting and budgeting for the multi-billion dollar Employee Benefit Funds, strategic planning, internal control, risk management oversight, and PMA implementation. Additionally, Mr. Crawford heads OPM's financial modernization project office. Prior to April 2005, Mr. Crawford managed the agency's management services portfolio which includes security, human capital, facilities and administrative operations, provided day-to-day supervision of the Chief Information Officer and Equal Employment Officer as well as coordinated e-Gov initiatives with the e-Gov Program Director. Mr. Crawford also served in the capacity as the Director for the Office of Executive Resources and Management.

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FederalNewsRadio - Ask the CFO - Kevin Perkins (FBI)

Mr. Perkins was born in 1960 and was raised in the Pittsburgh, Pennsylvania area. He earned a Bachelor of Business Administration degree in 1982 from Baylor University, Waco, Texas. Following graduation he pursued a career in public accounting with an international accounting firm. He is a Certified Public Accountant and a member of the American Institute of Certified Public Accountants.

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Monday, August 28, 2006

HUD plans integrated financial-management system

The Housing and Urban Development plans to seek enterprisewide implementation and integration of the PeopleSoft financial-management system as part of the agency’s accounting and financial modernization.

HUD aims to reduce the number of disparate legacy systems and transition its core systems to PeopleSoft to implement an integrated system that can produce auditable financial statements throughout the agency. PeopleSoft is one of several financial-management systems that the Financial Systems Integration Office, formerly Joint Financial Management Improvement Program, has approved.

The eventual contract would have an 18-month base period and options that could lengthen it to 10 years. Interested sources can comment on the draft solicitation until Sept. 5, HUD said in its recent posting on FedBizOpps.

The contractor would have to implement the financial-management system at a shared-services provider or other federal or private hosting site as defined by the Office of Management and Budget under the Financial Management Line of Business consolidation initiative.

Among the terms, the contractor would:

  • manage and migrate financial requirements for budget execution, funds control, commitments/reservations, obligations, accounts payable, accounts receivable, costs and financial reporting
  • install, operate and support the application, patches and service packs
  • put in place a business management process to manage the total work effort associated with deploying the integrated financial-management system.

USDA seeks replacement for aging financial management system

The Agriculture Department’s Office of the Chief Financial Officer has issued a request for proposals for modernizing its aging financial management system. Currently, the office is in charge of the biweekly payroll for one-third of all federal employees.

The RFP calls for a replacement of its current corporate financial system, Foundation Financial Information System (FFIS), a customized version of CGI Group’s mainframe Federal Financial System.

In addition to the new system, the USDA stipulates that the solution must be implemented at a USDA-specified hosting site, federal or commercial. In an amendment to the RFP, the department stated it was no longer incorporating hosting services into the solicitation. A separate RFP for hosting services will be issued in the future. Additionally, the USDA requires that help-desk capabilities reside within the United States.

Presently, FFIS has an estimated terabyte of stored data. The estimated growth rate from the 29 USDA agencies and offices is estimated at 10G to 20G per month.

The current plan for the system set by the USDA calls for the institution of the system over a five-year period and an operations and maintenance program over the following five years.

Responses to the RFP, published on the FedBizOpps Web site, are due to the USDA Dec. 15.

Financial LOB moves to standardize rules

Agencies will gain a clearer picture next month of how the administration wants them to standardize financial-management activities.

The General Services Administration expects to complete the major milestones for data and business process standardization in September to advance the Financial Management Line of Business Consolidation initiative.

Combined, these milestones constitute a foundation for letting agencies share financial data internally and eventually across government, said Keith Thur- ston, assistant deputy associate administrator in the Office of Technology Strategy in GSA’s Office of Governmentwide Policy.

With the financial LOB, the Office of Management and Budget aims to lower the cost, and improve quality and performance of financial-management systems, as agencies move to shared-services pro-viders, said Adam Goldberg, chief of the Financial Integrity and Analysis Branch in OMB’s Office of Federal Financial Management.

Although more guidance will evolve over time, it will be clear to agencies next month that a road map is in place, Thurston said.

“If agencies want or need to move to a new financial-management system now, the processes and expectations will be in place to help that occur,” he said.

In September, GSA will unveil the Common Governmentwide Accounting Code, giving agencies common definitions, data elements and structure, Thurston said.

“With universal data definitions, we will be able to aggregate and compare data,” he said at a recent federal financial-management conference sponsored by the Treasury Department’s Financial Management Service.

All new financial-management systems must adhere to the common code, he added.

GSA also will release the first set of business process standards for financial and accounting tasks in the common areas of payments, receipts, funds management and reporting. The standards will be the result of consolidating and harmonizing agencies’ accounting methods and business practices for the core financial-management functions, Thurston said.

A strong foundation for the accounting of government resources is critical for accomplishing the goals of the FM LOB, said Sam Mok, Labor Department chief financial officer.

GSA, its Financial Systems Integration Office, OMB and the Chief Financial Officers Council govern the Financial Management Line of Business.

OMB revises financial audit guidelines

The Office of Management and Budget has revised its guidelines for the minimum requirements for audits of federal financial statements. OMB issued [Bulletin 06-03] today outlining the changes, which include redefining some terms to align them more closely with their private-sector meanings.

The changes, which OMB drafted in coordination with inspectors general, apply to audits of financial statements of all executive departments, agencies and government corporations.
The bulletin changes the definitions of several terms used in financial management and auditing to bring them more in line with private-sector terminology.

The current definition of material weakness, which will hold for financial reporting periods ending before Dec. 15, is the use of internal controls that do "not reduce to a relatively low level" the risk that errors or fraud could occur and not be quickly detected. The term is now defined as any significant deficiency or combination of significant deficiencies that leads to a "more than remote" chance that a material misstatement of financial results could occur and not be detected.

“American taxpayers deserve a government that is both responsive and accountable," said Clay Johnson, OMB's deputy director for management. "The new federal auditing guidelines reinforce the importance of proper accounting and reporting practices to ensure that we properly reduce wasteful spending in government and take care of the taxpayers’ money.”

Cost Savings Achieved Through E-Government and Line of Business Initiatives

For those agencies not yet fully migrated to these common solutions, OMB is requesting a baseline be developed in order to measure cost savings following migration, on an on-going basis. This effort builds upon several initiatives already underway, including the E-Gov/LoB Implementation Plans and the focus on Earned Value Management and improved project planning. (OMB, August 2006)

21st Century Accountability Challenges

The Government Accountability Office (GAO) released the following report:

Presentation By The Comptroller General "21st Century Accountability Challenges," by David M. Walker, comptroller general of the United States, before the American Instituteof Certified Public Accountants' annual governmental accounting andauditing update conference, in Washington, D.C.

GAO-06-1078CG, August 21, 2006.
http://www.gao.gov/cghome/d061078cg.pdf

Monday, August 14, 2006

Agencies still in the red on financial performance

"Of all the categories under which the Executive Branch Management Scorecard analyzes agencies, financial performance continues to be the one in which agencies consistently score the worst. Although many agencies have shown noticeable improvements in many areas since the score card's inception in fiscal 2001, failing financial grades are a constant.

The low scores remain partly because it's the only category on the score card that is independently verified, some analysts say. The Government Accountability Office is set to publish a report in September that lawmakers hope will shed more light on how the Office of Management and Budget arrives at the scores for the other categories.

In the third quarter of fiscal 2006, 16 of 26 departments and agencies earned red, the lowest grade. Moreover, 12 of those 16 agencies have always gotten red scores in financial performance.

There have been a few positive scores. The National Science Foundation has always scored a green, the highest rating, in financial performance. The Social Security Administration has earned yellows or greens. And after seven straight red ratings, the Education Department jumped to green in the first quarter of fiscal 2003 and has stayed there ever since.

No scores for financial performance changed between the second and third quarters of this year, according to the score card. In case-by-case progress assessments, OMB gave 24 agencies green scores because, in its view, the financial performance objectives were proceeding according to plan. The Homeland Security Department and NASA received yellow ratings, meaning that OMB noticed some slippage in establishing financial performance objectives. The progress assessment is a different measure from the status grade.

A green score means an agency is implementing its initiatives as planned; it is the highest rating an agency can receive. Yellow shows a need for adjustments to achieve the objectives in a timely manner, and red means an initiative is in serious jeopardy. The score card evaluates agencies in five areas on the President’s Management Agenda: workforce, competitive sourcing, financial performance, e-government, and budget and performance integration."

Financial Management LOB set for major milestones

"The General Services Administration expects to deliver initial versions of data standardization and business process transformation next month as part of the Financial Management Line of Business.

These milestones constitute a major foundation for letting agencies share financial data internally among their offices and across government, said Keith Thurston, assistant deputy associate administrator in the Office of Technology Strategy in GSA's Office of Governmentwide Policy.

GSA in September will provide a draft of the Common Governmentwide Accounting Code so agencies will use the same definitions for identical data elements, Thurston said.

'With universal data definitions, we will be able to aggregate and compare data,' he said today at the Financial Management Service (FMS) Annual Government Financial Management Conference in Washington. FMS is an agency of the Treasury Department.

GSA also will release the first slice of business process standardization for common financial tasks in payments, receipts, funds management and reporting. The business processes will be the result of consolidating and harmonizing accounting methods, Thurston said.

The Financial Management Line of Business is governed by GSA, the Office of Management and Budget, the Chief Financial Officers Council and the Financial Systems Integration Office in GSA.

OMB in May released the updated Migration Planning Guidance to clarify a road map for agencies moving to shared-services providers under the Financial Management Line of Business. It included a competitive framework, template for migration project plan, change management best practices and a menu of services that financial-management shared-services providers can deliver. OMB will further update the migration guidance next month, Thurston said. "

Auditors to look into Federal Protective Service finances (8/9/06)

"The Immigration and Customs Enforcement agency has hired financial consultants to conduct an audit of the cash-strapped Federal Protective Service.

Senate appropriators recently rejected a Homeland Security Department request to shift $42 million to address a budget shortfall at FPS. In a July 20 letter explaining that decision, Sen. Judd Gregg, R-N.H., said the requested shift would represent an inadequate, short-term solution to the agency's funding issues.

Gregg, chairman of the Senate Appropriations Homeland Security Subcommittee, said any new request should include details on how FPS, which is housed within ICE, plans to fix its finances in the long term.

A source familiar with FPS' operations said Julie Myers, ICE assistant secretary, recently circulated a memorandum announcing the agency's hiring of a consultant to audit FPS. The source declined to offer further details about the memo. "

FCW.com - GAO: DOD modernization needs leadership

"The Defense Department maintains more than 3,700 business systems at a cost of about $16 billion per year. But the massive effort to modernize and integrate these systems lacks a clear strategy and direct leadership, according to the Government Accountability Office.

In written testimony submitted Aug. 3 to the Senate Homeland Security and Governmental Affairs Committee's Federal Financial Management, Government Information, and International Security Subcommittee, GAO Comptroller General David Walker criticized the long-standing problems in DOD's management of its business transformation.

'DOD's pervasive financial and business management problems adversely affect the economy, efficiency and effectiveness of its operations, and have resulted in a lack of adequate accountability across all major business areas,' Walker said.

To illustrate the point, GAO identified three weaknesses in DOD's financial management and business operations. The department has been unjustly pursuing debt collection for battle-injured soldiers; it cannot account for inventory shipped to repair contractors; and it is unable to properly track costs for the ongoing war on terror, according to the testimony.

'Neither DOD nor Congress know how much the war was costing and how appropriated funds were spent, or have historical data useful in considering future funding needs,' Walker said.

Weaknesses in financial management have several ill effects. DOD is less able to control costs, justify budgets, gauge performance and discourage fraud, he said. In a 2004 report, GAO said the department misreported costs for mobilizing Army reservists by 30 percent, or $2.1 billion.

DOD has taken steps to organize departmentwide business transformation, establishing the Defense Business Systems Management Committee in February 2005 and establishing the Business Transformation Agency last October. To address financial management, the department released its Financial Improvement and Audit Readiness Plan in December 2005 and has developed its Standard Financial Information Structure to categorize data. "

OMB to agencies: Measure IT costs savings from e-gov

"With the pressure mounting from Capitol Hill to prove how much money e-government is saving agencies, the Office of Management and Budget yesterday directed agencies to begin measuring those reduced costs.

In a memo from Karen Evans, OMB's administrator for IT and e-government, agencies by Sept. 30 must begin measuring costs savings by developing baseline cost estimates and identify projects that are due to be replaced, shut down or modified because of an e-government or Line of Business Consolidation initiative.

'With the E-Government initiatives deployed and operational, and the LOB initiatives underway, we are currently realizing the goals of improved citizen services, and increased efficiency and effectiveness,' Evans said. 'We must now concentrate on identifying and realizing the cost savings these initiatives are providing on a governmentwide basis.'

One of the main criticisms of e-government from the Hill is the inability to show the value or savings for the money the agencies are spending on the projects. "

Tuesday, August 08, 2006

Microsoft flexes ERP muscles

"Increasing numbers of companies are teaming with Microsoft to sell its CRM and ERP products to the government, albeit after some customization.

In the five years since Microsoft first introduced its CRM and ERP solutions and set its sights on the public sector, it has gained traction in finding partners to sell these enterprise management products to contractors, who sell them as part of their IT work for government agencies.

The strategy is part of the company's campaign to expand its sales channel and create an image as an enterprise software company rather than solely a desktop software developer. It also helps the company push deeper into public sector markets.

'Our business applications for Dynamics fit seamlessly into the platform products that our customers are using today, so they're easy to manage, easy to administer, have a very low cost of ownership and are less complex,' said Jack Hersey, managing director for worldwide public sector, Microsoft's business division. "

Sunday, August 06, 2006

GAO's Walker to DOD: "Declare a war on waste"

"Comptroller General David Walker called for the Defense Department to 'declare a war on waste' and completely overhaul its legacy information management systems by the year 2012.

'There are thousands of outdated, nonintegrated systems that don't talk to each other. We need to kill or disable all nonessential business information systems,' Walker, head of the Government Accountability Office, told a Senate subcommittee yesterday at a hearing on DOD's financial management.

The Homeland Security and Government Affairs Subcommittee on Federal Financial Management, Government Information, and International Security held the hearing that also included three DOD financial management officials, including Jack Patterson, a principal deputy undersecretary and comptroller.

Walker said DOD still is suffering from longstanding issues of poor financial management and inadequate accountability, practices that continue to leave the agency vulnerable to fraud and abuse.

'Because of decades-old problems, the Defense Department wastes billions of dollars every year,' Walker said.

Subcommittee chairman Tom Coburn (R-Okla.) concurred with Walker's assessment. "

Friday, August 04, 2006

Today's GAO Reports

Financial Management
Department of Defense: Sustained Leadership Is Critical to Effective Financial and Business Management Transformation.
GAO-06-1006T, August 3, 2006 (25 pages).
http://www.gao.gov/docdblite/details.php?rptno=GAO-06-1006T

Senate approves measures to improve Defense accountability (8/3/06)

"The Senate took steps on Thursday to impose greater public accountability on Pentagon operations by approving several amendments to the fiscal 2007 Defense appropriations bill.

The amendments, sponsored by Sen. Tom Coburn, R-Okla., passed easily as senators worked through the remaining amendments to the bill and Majority Leader Bill Frist, R-Tenn., announced his intention to complete work on the measure Thursday night.

One of the Coburn amendments, which passed 96-0, would require the Defense Department to review any "improper payments" made for travel expenses. Another, approved by voice vote, would require the department to post online all reports mandated by Defense appropriations bills. It would, however, give the Defense secretary the authority to redact any information that could compromise national security.

Defense Department studies typically arrive on Capitol Hill with little fanfare and often go unnoticed by lawmakers, rarely seeing the light of day. "Whatever they report ought to be made available to the American public," Coburn said."

Personnel Announcement

"President George W. Bush today (8/3/2006) announced his intention to nominate the following individuals to serve in his Administration:

The President intends to nominate Nelson M. Ford, of Virginia, to be Assistant Secretary of the Army (Financial Management). Mr. Ford currently serves as Principal Deputy Assistant Secretary for Financial Management and Comptroller of the Department of the Army. Earlier in his career, he served as Deputy Assistant Secretary for Health Budgets and Financial Policy at the Department of Defense, and Chief Operating Officer at Georgetown University Medical Center. Mr. Ford received his bachelor's degree from Duke University and his master's degree from the University of Delaware.

The President intends to nominate Gerald Walpin, of New York, to be Inspector General of the Corporation for National and Community Service. Mr. Walpin currently serves as Counsel at Katten Muchin Rosenman LLP. Prior to this, he served as Senior Partner at the firm's predecessor, Rosenman & Colin LLP, where he was Chairman of the Litigation Department. He previously served as President of the Federal Bar Council. Mr. Walpin received his bachelor's degree from City College of New York and his LLB from Yale University. "

Thursday, August 03, 2006

Today's GAO Reports - August 03, 2006

The Government Accountability Office (GAO) today released the following testimony:

Department of Defense: Sustained Leadership Is Critical to Effective Financial and Business Management Transformation, by David M. Walker, comptroller general of the United States, before the Subcommittee on Federal Financial Management, Government Information, and International Security, Senate Committee on Homeland Security and Governmental Affairs. GAO-06-1006T, August 3.
http://www.gao.gov/cgi-bin/getrpt?GAO-06-1006T
Highlights - http://www.gao.gov/highlights/d061006thigh.pdf

FederalNewsRadio - Ask the CFO - Thomas Thompson (IHS)

"Thomas D. Thompson is the Director for the Office of Finance and Accounting and Chief Financial Officer for the Indian Health Service (IHS), an agency within the Department of Health and Human Services (HHS). Mr. Thompson is an enrolled member of the Cherokee Nation of Oklahoma.

As Director for the IHS Office of Finance and Accounting, Mr. Thompson provides leadership to ensure that IHS finance/budget policy and appropriations support program continuity is consistent with the mission of the IHS. He works closely with the IHS senior executives to ensure that testimony before congressional committees is accurate and timely; reflects sound business acumen that is in compliance with applicable laws, rules, and regulations; and supports self-determination aimed at the overall improvement of the health status of American Indian and Alaska Native people. Among other major duties, Mr. Thompson establishes policy and procedures for the IHS financial management function that ensure compliance with the Office of Management and Budget requirements. He directs all IHS financial management functions and budget formulation activities in collaboration with agency program and planning offices, and congressional and legislative affairs staff.

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Wednesday, August 02, 2006

Modly says DOD needs to crack the whip to accelerate transformation

"Thomas Modly, deputy undersecretary of Defense for financial management, surprised his audience at a recent conference when he claimed that intolerance is a desirable attribute for achieving business transformation.

'We can't tolerate the way things are now,' he explained during his presentation at the Defense Finance 2006 conference in Arlington, Va., held by Worldwide Business Research Inc. of New York.

Modly was referring to DOD enterprise processes that are failing to keep up with Defense transformation and private-sector trends. While the military's warfighting capabilities have become increasingly nimble and adaptive, the Pentagon's business processes have remained sluggish and outdated.

While the private sector has greatly reduced its product development and systems acquisitions cycles, DOD is 'going completely in the other direction,' Modly said.

DOD formed the Business Transformation Agency, which Modly co-directs, last year to set standards to consolidate and streamline processes and to provide systems interoperability. While individual agencies are managing the transformation, Modly's office determines the overall path.

'We swept up processes being developed in different domains, defined them and described what they wanted to accomplish at an enterprise level,' Modly said. 'Once we established standards, no one at a systems level can invest in any system over $1 million that does not meet those rules.' "

E-gov scores improve slightly on latest management score card

"Three agencies earned improved ratings for electronic government in the administration's third quarter management score card, released Tuesday. But red and yellow marks continue to dominate that portion of the traffic-light-style assessment.

E-government scores have fluctuated widely this year. Eight agencies received improved grades on the score card for the first quarter of fiscal 2006, but nine agencies slipped in the second quarter assessment. Much of the variability can be traced to funding difficulties, as Congress has resisted the Office of Management and Budget's efforts to direct agency spending toward the governmentwide projects.

The Commerce, Education, and Housing and Urban Development departments produced rising e-government scores in the third quarter of fiscal 2006, while the Small Business Administration's score fell to red, for "unsatisfactory."

The Bush administration's quarterly score card addresses the five major areas of the President's Management Agenda, as well as several smaller program initiatives. In the area of human capital management, scores for the Agriculture and the Veterans Affairs departments rose to green, for "success." In competitive sourcing, the Environmental Protection Agency moved up to green and the Homeland Security Department fell to yellow, or "mixed results."

No agencies changed status in the financial management or budget-performance integration categories; 16 agencies currently have red ratings for financial performance, while the majority are yellow or green on integration.

In a statement accompanying the latest score card, OMB Deputy Director for Management Clay Johnson said, "We are progressively improving our ability to improve program and agency performance."

Tuesday, August 01, 2006

Thought Leader Profile - Paul Brinkley

"Changing the business practices at the U.S. Department of Defense means more than saving money. DOD leaders believe it's a matter of life and death. And they think Paul Brinkley is just the man for the job.

YOU WOULDN'T GUESS IT FROM THE NAME, but the Department of Defense's business management modernization project isn't just another initiative to update business processes, rein in runaway costs or replace a tangle of legacy computer systems with an integrated network more suited to the 21st century. In fact, to hear Secretary of Defense Donald Rumsfeld tell it, it's not about business practices or financial accountability at all. In 2001, just prior to the Sept. 11 terrorist attacks, Rumsfeld said, 'It is not, in the end, about business practices, nor is it the goal to improve figures on the bottom line. It's about the security of the United States of America. And let there be no mistake, it is a matter of life and death. Our job is defending America, and if we cannot change the way we do business, then we cannot do our job well, and we must.'

Leading the transformation is an enor mous job with enormous responsibility. Rumsfeld has handed that responsibility to Paul Brinkley. As deputy under secretary of Defense for business transformation, he is overseeing the Defense Department's business management modernization program. Brinkley also heads the Business Transformation Agency (BTA), a new organization accountable for streamlining the thousands of systems that support logistics, acquisition, finance and personnel activity across the Department of Defense (DOD). But as Brinkley is quick to point out, the program's overall objective is not to cut the number of systems in use across the various branches of the military; it's something much more results-oriented: improving support for the country's warfighters.

The very existence of his organization within the DOD reflects the increasing complexity of our nation's security challenges. Just as our fighting"

EDUCATION HAS A NEW MONEY MAN

"The Department of Education recently welcomed its newest chief financial officer, Lawrence Warder, who was recently confirmed by the Senate.

'I am so pleased to have Larry join my team here at the Department,' said Education Secretary Margaret Spellings. 'His vast experience and sterling reputation in the financial sector will help us account for every dollar received and invested by this Department. He will work to ensure that every dollar is spent wisely, in the best interest of students and taxpayers alike.'

Warder will serve as the principal advisor to Secretary Spellings on all matters related to discretionary grant-making, cooperative agreements and procurement and will be responsible for financial control and accounting at the Department.

Warder most recently served as global director at Deloitte Consulting, a company he has served since 1969. He has held senior management positions with DC in the London, New York, Dallas and Detroit offices. Prior to Deloitte, Warder served as supervisor for financial systems at General Tire and Rubber Company.

Warder earned his bachelor's degree in mathematics from the University of Akron and his master's in business administration from Kent State University."

@FedCFO