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Friday, June 29, 2007

Homeland Security outlines plan to consolidate financial systems

The Homeland Security Department plans to consolidate its financial management systems around systems used by two of its component agencies, but overseers are skeptical of the strategy.

Under a recently completed plan, the 22 agencies that make up DHS will move to financial systems based on those in place at the Transportation Security Administration and Customs and Border Protection, DHS Chief Financial Officer David Norquist said Thursday in Senate testimony.

The department plans for 50 percent of its components to be on consolidated systems by fiscal 2009 and for 97 percent of the department to use one of the two systems by fiscal 2011. After that date, the department will select one system as a baseline.

Small offices like the Office of Health Affairs will shift first, Norquist said, followed by bigger agencies such as the Federal Emergency Management Agency and Immigration and Customs Enforcement.

The Office of Management and Budget has approved the plan. And the initiative appeared to receive qualified endorsements from the Government Accountability Office and the two senators who stayed through a June 29 hearing of the Senate Homeland Security and Governmental Affairs subcommittee on federal financial management.

In a report released at the hearing, GAO also questioned the selection of TSA and CBP, noting that “they have numerous financial management weaknesses and consequently do not appear to be good candidates to be models for an entity with an annual budget in excess of $40 billion.”

Norquist said the two systems were picked because they are already widely used in DHS, with 37 percent of the department employing one of them. And they are commercially available and supported by multiple vendors, which increases competition, he said. TSA uses a financial management system based on Oracle software, while CBP uses has a system developed by SAP AG that combines finance, accounting and asset management.

Norquist said financial problems at TSA and CBP do not relate to their accounting systems.

-Daniel Friedman, FederalTimes.com

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GAO: DHS lacks strategy to consolidate financial systems

The Homeland Security Department plans to consolidate several duplicative financial management systems although it does not have a detailed strategy to integrate its systems, standardize business processes and put in place effective workforce practices, the Government Accountability Office said.

Williams testified June 28 before Senate Homeland Security and Governmental Affairs Committee’s Federal Financial Management, Government Information, Federal Services and International Security Subcommittee. GAO today released its detailed report on DHS’ integrated financial management systems challenges.

The department will migrate its small agencies to one of two financial management systems in the next phase of its financial management consolidation. It anticipates that by fiscal 2009 one half of its agencies will be using the consolidated systems, said David Norquist, DHS’ chief financial officer.

The department will begin moving its larger components, such as the Federal Emergency Management Agency, in 2009. Consolidating financial management systems is the first step toward a departmentwide integrated system.

The 22 agencies that make up DHS each brought their own financial systems. DHS decided its component agencies will choose to move to one of two model systems now in use at the Transportation Security Administration and Customs and Border Protection to standardize financial systems platforms and better share data.

The department approach is consistent with GAO recommendations for strengthening financial management, Norquist said. DHS recently updated its concept of operations to describe current business processes and technical specializations of the system.

-Mary Mosquera, FCW.com

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Lawmakers urge DHS to speed up financial consolidation

The Homeland Security Department has made little progress in developing an integrated financial management system to address financial weaknesses the agency has inherited, a Government Accountability Office representative said Thursday.

At a hearing before the Senate Homeland Security and Governmental Affairs Subcommittee on Federal Financial Management, McCoy Williams, director of financial management and assurance at GAO, commended DHS for halting an unsuccessful attempt at a financial management system, but added that the department has made little progress since.

The failed system, known as eMerge2, was expected to establish the strategic direction for modernizing DHS financial, accounting, procurement, personnel, asset management and travel systems, processes and polices, Williams said. But after officials discovered that a contract awarded to BearingPoint Inc. in 2004 was plagued with management challenges, the department's chief financial officer declared the project officially "dead," Williams said.

David Norquist, DHS' new chief financial officer, said the department spent about $52 million on eMerge2. But the agency made a responsible decision to end the project before spending an estimated total of $229 million, the CFO added. Former department financial chief Andrew Maner let the eMerge2 contract expire Dec. 22, 2005.

Norquist said DHS has developed a new strategy -- the Transformation and Systems Consolidation -- which calls for component agencies to consolidate financial systems into one of two models, based on the Transportation Security Administration or the Customs and Border Protection bureau. He said that by fiscal 2009, he expects about half of the department to migrate to the designated system.

Williams recommended that DHS obtain guidance from the Internal Controls Over Financial Reporting Playbook, which was created by the department in March to establish policies and processes for developing a sound financial management system.

Keith Rhodes, a chief technologist at GAO, said the key to developing a financial management system at DHS is ensuring financial discipline in the process and ensuring that discipline is continuous through turnover and changing presidential administrations.


-Brittany R. Ballenstedt, GovExec.com

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Today's GAO Publications

The Government Accountability Office (GAO) today released the following guidance, report, and testimony:

GUIDANCE
Financial Audit Manual: Volume Three, Exposure Draft, June 2007.
GAO-07-313G, June 29
http://www.gao.gov/cgi-bin/getrpt?GAO-07-313G

LETTER REPORT
Homeland Security: Departmentwide Integrated Financial Management Systems Remain a Challenge.
GAO-07-536, June 21
http://www.gao.gov/cgi-bin/getrpt?GAO-07-536
Highlights - http://www.gao.gov/highlights/d07536high.pdf

TESTIMONY
Homeland Security: Transforming Departmentwide Financial Management Systems Remains a Challenge.
GAO-07-1041T, June 28
http://www.gao.gov/cgi-bin/getrpt?GAO-07-1041T
Highlights - http://www.gao.gov/highlights/d071041thigh.pdf

Thursday, June 28, 2007

CFO Survey Released by AGA and Grant Thornton

For immediate release: June 28, 2007

Contact: Mike Hettinger
Grant Thornton LLP
703-373-8690
mike.hettinger@gt.com

CFO Survey Released by AGA and Grant Thornton
11th annual survey examines oversight, compliance efforts

WASHINGTON, June 28, 2006 ¾ Grant Thornton LLP and the Association of Government Accountants today released the 11th annual survey of Federal government Chief Financial Officers. The report, Scoring Financial Management & Oversight Efforts, was distributed earlier this week at AGA’s annual Professional Development Conference in Nashville, Tennessee.

More than 100 Federal financial executives and managers took part in the survey, which looked at balancing competing priorities, barriers to progress and the Office of Management and Budget’s Financial Management Line of Business initiative. This year’s survey also turned the tables and let financial managers evaluate their evaluators – the Government Accountability Office, the Office of Management and Budget, Inspectors General and Congressional committees.

Generally, survey results suggest that resources are not balanced between meeting compliance requirements and adding value to program decision making and that more consideration should be given to risk mitigation. Many survey respondents said that the government pays too much for financial management compliance and receives too little in return. Oversight groups should understand that they can have both positive and negative effects, and if they could agree on governmentwide priorities for financial management – and integrate the compliance process – this would help set the stage for fundamental reforms.

"The building blocks for effective financial management are there, we now need to find the most effective way to bring them together", said Clifton Williams, a Partner at Grant Thornton and principal author of this year’s survey.

Relmond Van Daniker, Executive Director of AGA added, "This year’s survey really highlighted the fact that today’s federal financial managers are walking a tightrope as they attempt to balance the competing priorities of compliance with strategic decision making."


About the Association of Government Accountants
The Association of Government Accountants, founded in 1950, is dedicated to the enhancement of public financial management. AGA serves state, local and Federal financial managers – more than 14,000 members, including professionals in accounting, administration, auditing, budgeting, consulting, grants, fraud investigation and information technology. AGA has been instrumental in developing accounting and auditing standards and in generating new concepts to improve financial management functions. AGA conducts independent research in all aspects of government financial management. These studies, including the 2007 AGA CFO Survey, make AGA a leading advocate for improving government fiscal administration and program performance. For more information, visit http://www.agacgfm.org/.

About Grant Thornton LLP
Grant Thornton LLP, founded in Chicago in 1924, is one of the largest accounting and management consulting firms in the world. Grant Thornton’s Global Public Sector, based in Alexandria, Va., is a global management consulting business with the mission of providing responsive and innovative financial, performance management, human capital management and systems solutions to governments and international organizations. To learn more about Grant Thornton’s Global Public Sector, contact us at 703.837.4400 or visit www.grantthornton.com/publicsector.

An electronic version is of the report is available at:
Grant Thornton Global Public Sector Publications

FederalNewsRadio - Ask the CFO - Chuck Christopherson (USDA)

United States Department of Agriculture (USDA)

Charles Christopherson - Chief Financial Officer

It's going to be a whole new way of looking at government finances. USDA CFO Charles Christopherson says it may be June, but that January's initial deadline for implementing the Federal Funding Transparency Act needs to be taken seriously. Not only will the act make it easier for members of the public to understand how agencies, like the USDA, are spending their dollars, Christopherson says it may also force agencies to look at their numbers in ways they never considered. Christopherson also talks about the new approach to the farm bill and the impact of funding proposals for avian influenza and biofuels.


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Coleman is GSA's acting CIO

The General Services Administration has named Casey Coleman acting chief information officer, the agency announced today. She has been CIO at GSA’s Federal Acquisition Service.

Coleman replaces Mike Carleton, who is leaving to be the Health and Human Services Department's CIO and deputy assistant secretary for information technology within the Office of the Assistant Secretary for Resources and Technology.

Coleman was FAS’ first CIO since its creation in October 2006. She had been CIO at the GSA’s Federal Technology Service, and she headed the GSA Office of Citizen Services from 2002 to 2004.

-Mathew Weigelt, GovernmentLeader.com

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Wednesday, June 27, 2007

AGA PDC 2007 Wrap Up

Once again, the Association of Government Accountants put on a very informative and collaborative educational conference at its annual Professional Development Conference.

Sessions were organized around the following tracks:
  • Accountability & Ethics
  • Auditing Tips, Tools & Techniques
  • Financial Management Strategies
  • Innovative Funding Mechanisms
  • Management Challenges & Solutions
Some useful links to conference information can be found below.

Speaker Biographies
Speaker Presentations
Monday Summary
Tuesday Summary
Wednesday Summary

Today's GAO Publication

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

Management Report: Opportunities for Improvements in FDIC's Internal Controls and Accounting Procedures.
GAO-07-942R, June 27.
http://www.gao.gov/cgi-bin/getrpt?GAO-07-942R

Tuesday, June 26, 2007

Today's GAO Publication

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

Navy Working Capital Fund: Management Action Needed to Improve Reliability of the Naval Air Warfare Center's Reported Carryover Amounts.
GAO-07-643, June 26.http://www.gao.gov/cgi-bin/getrpt?GAO-07-643
Highlights - http://www.gao.gov/highlights/d07643high.pdf

Friday, June 22, 2007

OPM to move on Financial Management LOB competition

The Office of Personnel Management will proceed in July with its stalled plans to acquire a single integrated accounting and procurement system under the Financial Management Line of Business consolidation initiative.

OPM next month will issue a synopsis and request for information for its contract action and conduct a public/private competition between September and November, the agency said in its posting June 21 on the Federal Business Opportunities Web site.

OPM anticipates making an award by summer 2008 and starting implementation by October 2009.

The competition will be among private- and public-sector shared-services providers that have proven their expertise in using software applications certified by the Financial Systems Integration Office.

-Mary Mosquera, FCW.com

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Taking over as HHS CIO, Carleton comes full circle

General Services Administration Chief Information Officer Michael Carleton will take over July 23 as CIO at the Department of Health and Human Services, where he began his federal career.

HHS Secretary Mike Leavitt today announced Carleton as his choice for CIO and deputy assistant secretary for information technology at the Office of the Assistant Secretary for Resources and Technology.

Carleton replaces Charles Havekost, who resigned earlier this month to take a position at the International Atomic Energy Agency in Vienna, Austria.

Carleton will oversee the department’s IT resources, program systems and infrastructure. He will also promote performance gains using enterprise architecture, capital planning and investment. Among other issues, HHS is consolidating data centers, modernizing Medicare claims processing, standardizing Medicare financial management systems, promoting the establishment of a nationwide health information network and transforming business systems at the National Institutes of Health.

-Mary Mosquera, GovernmentLeader.com

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Thursday, June 21, 2007

FederalNewsRadio - Ask the CFO - Jennifer Main (SBA)

Small Business Administration

Jennifer Main - Chief Financial Officer

Figure out who your customers are, what they need and then meet that need. That's an ongoing process at the Small Business Administration and part of that process has elevated Jennifer Main from the CFO to the CFO and Associate Administrator for Performance Management. She says beyond crunching the numbers, her office is charged as well with making sure that the SBA, from its headquarters in DC to its field offices across the country, is united in bringing efficiency to its mission. One way this effort is paying off -- a new, integrated emergency response plan. She also says the SBA is benefiting from a case management approach to its emergency loan program.

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NRC Names William McCabe Chief Financial Officer

The Nuclear Regulatory Commission today announced the selection of William M. McCabe as Chief Financial Officer.

McCabe brings more than 28 years of experience in financial management. He has directed domestic and international corporate operations, financial system design and architecture of business operating solutions and public service financial management. Prior to his selection, McCabe served the Department of Education as Chief of Staff and Senior Advisor, and Acting Chief Financial Officer and key advisor to senior management since 2002.

McCabe received his Bachelor of Science, specializing in Finance and Economics, from the University of Maryland, College Park. He received his Master of Business Administration, specializing in Finance and Investments, from George Washington University, Washington, DC.

McCabe will assume his duties on Monday, June 25, 2007.

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Bill aims to enhance inspector generals' independence

Current and former inspectors general on Wednesday supported legislation aimed at strengthening the independence of IGs, while a top administration official defended the performance of an IG oversight group.

The measure (H.R. 928) introduced by Rep. Jim Cooper, D-Tenn., would update the 1978 Inspector General Act and mirrors similar measures presented over the past five years. The latest version comes amid a wave of recent battles among inspectors general, agency heads and congressional overseers at NASA, the General Services Administration and the Commerce Department.

Under provisions designed to enhance independence from agency heads, the legislation would set renewable seven-year term limits for IGs and stipulate that they could only be removed from office for a list of offenses including malfeasance, neglect of duty and "inefficiency."

The measure would also codify an existing IG oversight group, the President's Council on Integrity and Efficiency, into a statutorily chartered council and would allow it to submit independent budget requests to supplement those forwarded by agency heads. In addition, it would close a pay loophole under which career employee IGs often are capped at a pay grade below that of their top subordinates, by ensuring that IGs are considered at the level of agency senior staff members.

-Jenny Mandel, GovExec.com

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Stumping for Attention To Deficit Disorder

The problem is the skyrocketing cost of government health-care and retirement benefits. By most estimates, they will break the national bank as the baby boom generation retires.

Fed up with Washington's paralysis on the issue, the government's chief auditor, David M. Walker, along with analysts from three ideologically diverse think tanks, is venturing beyond the Beltway to explain the issue to voters. Their goal: to generate enough grass-roots anger to force the 2008 presidential candidates to discuss the problem.

Their unusual road show is called the Fiscal Wake-Up Tour which is organized by the Concord Coalition, a Virginia nonprofit group formed in 1992 to promote responsible budgeting. The group is collaborating with the liberal Brookings Institution and the conservative Heritage Foundation.

Walker is the tour's rock star, profiled on "60 Minutes" and interviewed by faux-pundit Stephen Colbert. A former Arthur Andersen accountant, Walker heads the Government Accountability Office, a legislative agency that aims to improve government performance through audits and investigations.

With six years to go on a 15-year term, Walker has the stature and independence to say what he wants. For the past five years, since Congress ignored his advice and created a hugely expensive prescription-drug program for Medicare beneficiaries, Walker has put the looming fiscal crisis at the top of his agenda.

The biggest entitlements are Social Security, Medicare and Medicaid, which together account for about 40 percent of federal spending. Interest on the national debt accounts for another 9 percent and is the fastest-growing budget category at $227 billion, or nearly twice what was spent last year on the war in Iraq.

All told, the cost of the three programs exceeds projected revenue by more than $50 trillion over the next 75 years, by the GAO's latest estimate.

-Lori Montgomery, WashingtonPost.com

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Blogs from the U.S. Government

FYI - USA.gov has posted a list of government blogs, both active and archived, at:
http://www.usa.gov/Topics/Reference_Shelf/News/blog.shtml

Wednesday, June 20, 2007

2007 AGA CFO Survey

Grant Thornton, in partnership with the Association of Government Accountants (AGA), has released the annual federal chief financial officer (CFO) survey to coincide with the AGA annual Professional Development Conference (PDC) which takes place next week in Nashville, TN.

Grant Thornton and AGA have sponsored the annual CFO survey since 1996. The 2007 CFO survey 'Scoring Financial Management & Oversight Efforts' highlights the balance and tension between meeting compliance requirements and making strategic decisions.

The 2007 survey, along with surveys from prior years, is posted on Grant Thornton's Global Public Sector Publications webpage and is available for download.

Today's GAO Publication

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

Inspectors General: Proposals to Strengthen Independence and Accountability, by Jeffrey C. Steinhoff, managing director, financial management and assurance, before the Subcommittee on Government Management, Organization, and Procurement, House Committee on Oversight and Government Reform.
GAO-07-1021T, June 20.
http://www.gao.gov/cgi-bin/getrpt?GAO-07-1021T
Highlights - http://www.gao.gov/highlights/d071021thigh.pdf

Tuesday, June 19, 2007

White House Budget Director Steps Down

WASHINGTON (AP) - White House budget director Rob Portman is resigning and will be replaced by former Iowa Rep. Jim Nussle, Bush administration officials said Tuesday.

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Monday, June 18, 2007

OMB identifies $17.7 billion in excess federal property

Agencies have nearly 22,000 unneeded buildings and land holdings worth a combined $17.7 billion, according to a Bush administration report sent to Congress today.

Five agencies control 95 percent of the properties: the Army, Navy, Agriculture Department, Air Force and Interior Department. Combined, the five agencies’ properties account for 78 percent of the $17.7 billion total. The $17.7 billion represents the cost of replacing existing properties, rather than the market value of those properties.

Congress passed a law in December 2006 requiring OMB to issue the report.

Since 2004, agencies have disposed of more than $4.5 billion in unneeded land and property. The administration expects to successfully meet its goal of disposing of a total $9 billion in unneeded properties by 2009, the report says.

Tim Kauffman, FederalTimes.com

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Today's GAO Publication

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

Financial Regulators: Agencies Have Implemented Key Performance Management Practices, but Opportunities for Improvement Exist.
GAO-07-678, June 18
http://www.gao.gov/cgi-bin/getrpt?GAO-07-678
Highlights - http://www.gao.gov/highlights/d07678high.pdf

USDA Farm Service Agency Financial Management Division Vacancy

USDA Farm Service Agency is seeking a Supervisory Systems Accountant to work in the Financial Management Division in the position of Director, Policy, Accounting, Reporting and Loan Center (GS-0510-15). The position closes on July 10, 2007.

Details can be found here:
http://jobsearch.usajobs.opm.gov/ftva.asp?seeker=1&JobID=58699166

Thursday, June 14, 2007

USDA names acting CIO

The Agriculture Department has named Deputy Chief Information Officer Jerry Williams acting CIO following the resignation last week of CIO Dave Combs.

Williams has led department initiatives to support information technology security and financial management. Before joining USDA, he was acting CIO at the Small Business Administration. He also was chief of the Federal Financial Management Systems Branch at the Office of Management and Budget.

-Mary Mosquera, FCW.com

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FederalNewsRadio - Ask the CFO - Daryl Kade (SAMHSA)

Substance Abuse and Mental Health Services Administration (SAMHSA)

Daryl Kade - Chief Financial Officer

SAMHSA is not the biggest of government agencies but its goal is, trying to help people recover from mental or substance use disorders. The budget is about $3 billion, much of it going out in the form of block grants. CFO Daryl Kade says, given the needs, every dollar has to go as far as possible. One of the ways that happens is, that as the CFO, she's given a strong voice when it comes to policy planning. There's also the matter of working with numerous partners on both the state and local level and making sure they have the systems and metrics in place to ensure money spent is getting results.

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Wednesday, June 13, 2007

Measuring program performance is a global issue

For the past six years, Bush administration officials have been trying to measure federal programs’ performance using the Performance Assessment Rating Tool (PART). But only now can the Office of Management and Budget make a connection between program ratings and funding levels.

Clay Johnson, OMB’s deputy director for management, said agency program PART scores is one factor in funding decisions made by the administration and Congress

OMB’s ongoing education of Congress and agencies on evaluating programs was a common theme at a meeting June 11 and 12 of about 75 people from more than 20 countries in Washington. The meeting, sponsored by the Organization for Economic Cooperation and Development (OECD) and the Council for Excellence in Government, brought together budget directors and other officials from the participating countries to exchange ideas about measuring results, said Barry Anderson, head of the Budgeting and Public Expenditures Division of OECD’s Public Government and Territorial Development Directorate.

The participants heard from several countries that are implementing different ways to measure performance.

-Jason Miller, FCW.com

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Tuesday, June 12, 2007

Changes in Financial Management

Federal financial managers are spending too much time and energy on following regulations and not enough time watching how much it all costs. James Brimson is President and founder of the Activity Based Management-Institute, and wrote the report on Process-based Financial Reporting for the Association of Government Accountants with funding from Grant Thornton. He joined WFED's Federal Drive hosts, Mike Causey and Jane Norris, to explain how using XML could save your agency money.

Listen to the interview

Commentary: Students join Defense Intelligence Agency team

The Defense Intelligence Agency plays a critical role in supporting all those who advance America’s response to global threats, from the war fighter to the policymaker. To do our best work, we need to maintain operations tempo in the field while developing enduring capabilities to sustain our strength into the future. The same is true for DIA’s financial management efforts, and my office is taking steps to develop and maintain high levels of expertise and agility.

We have been working to bring DIA up to speed on many initiatives championed previously by the major agencies covered by the Chief Financial Officers Act. Along with other members of the intelligence community, we are addressing requirements of the Government Performance and Results Act, the president’s management agenda and other management reforms led by the Office of Management and Budget. We are working closely with the Office of the Director of National Intelligence and other oversight organizations to leverage existing federal expertise.

My office is focusing on current and future challenges for financial management at DIA and for the federal community as a whole. Faced with increasing emphasis on managing for results, enhanced financial reporting capacity and the need for professional succession planning, we determined that outreach to the next generation of experts is a top priority. We pursued a partnership with DIA’s Directorate of Human Capital to join our best thinking on recruitment and retention with my own sense of my office’s future work-force needs, based on our internal assessment of core competencies. We created a co-op program as an ideal source for tomorrow’s DIA financial work force.

The benefits to my office and to DIA are substantial. We are recruiting some of the nation’s most competitive college students and giving them the kind of experience that can lead to productive careers in DIA, in the greater Defense community, or in the federal resource management arena overall. The program affords management an unparalleled opportunity to assess the potential of promising future employees. It opens doors in all components of my organization to new ideas. Most important, it supports expeditious recruiting of entry-level staff to assure continuity of knowledge and expertise through thoughtful succession planning. This can have a powerful effect on DIA’s ability to deliver on goals: supporting our war fighters on all fronts, by managing the resources that support their efforts with maximum efficiency and effectiveness.

- Michele O. Platt, chief financial executive of the Defense Intelligence Agency

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Monday, June 11, 2007

OMB asks agencies for 2008, 2009 goals

Agencies will offer the Office of Management and Budget by June 28 their final sets of goals for meeting the President’s Management Agenda in fiscal 2008 and 2009.

Clay Johnson, OMB’s deputy director for management, asked in a memo May 31 agencies’ deputy secretaries to develop and submit two last sets of “Proud to Be” goals for the next two years. The 2008 goals will need to be more specific, detailing what standards for success by which the agency hopes to measure their performance. For 2009 OMB is looking for a brief explanation of the agency’s goals.

OMB expects to finalize the 2008 goals by July 31, the memo states.

This is the first time OMB has asked for two-year goals, however.

OMB upped the ante for achieving green and yellow scores and staying green.

-Jason Miller, FCW.com

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READ THE OMB MEMO

SUMMARY OF CHANGES TO STANDARDS FOR SUCCESS for GOVERNMENT-WIDE INITIATIVES

Improved Financial Performance

Added the following green standards:
  • Reports in its audited financial statements that its systems are in compliance with the Federal Financial Management Improvement Act.
  • Has no repeat material auditor-reported internal control weaknesses.
  • Has no repeat material weaknesses or non-conformances reported under Section 2 Over Financial Reporting and Section 4 of the Federal Managers’ Financial Integrity Act that impact the agency’s internal control over financial reporting or financial systems.

Modified the yellow standards to include:

  • Has no more than one repeat material auditor-reported internal control weaknesses.
  • Has no more than one repeat material weakness reported under Section 2 Over Financial Reporting and no more than one non-conformance reported under Section 4 of the Federal Managers’ Financial Integrity Act.

Deleted the following yellow and made it a green standard:

  • Reports in its audited annual financial statements that its systems are in compliance with the Federal Financial Management Improvement Act.

GAO Sustains IBM Protest of EPA Financial System Modernization Program to CGI

The Government Accountability Office sustained IBM’s protest of the Environmental Protection Agency’s $84 million award to CGI-Federal to upgrade the agency’s financial-management system. The decision remains under protective order, but Mike Golden, GAO’s associate general counsel, said the agency found fault with EPA’s price and cost evaluations.

Golden would not say what recommendations GAO offered EPA to fix the procurement.

EPA has until Aug. 3 to decide how it will proceed.

-Jason Miller, FCW.com

Friday, June 08, 2007

Today's GAO Publication

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

Federal Aviation Administration: Cost Allocation Practices and Cost Recovery Proposal Compared with Selected International Practices.
GAO-07-773R, June 8
http://www.gao.gov/cgi-bin/getrpt?GAO-07-773R

New report calls for changes in financial management

Financial managers spend too much time complying with regulations and too little time helping manage costs and performance, according to a new report.

Not only are managers not getting enough meaningful performance information, financial reporting is harmed, said the report by the Association of Government Accountants and accounting firm Grant Thornton.

“One near-future possibility is the implosion of the federal financial function, resulting in a surge of disclaimer opinion on annual financial statement reports,” according to James Brimson, the author of the paper released Monday.

He suggests a new model that provides managers information needed for making sound business decisions: process-based accounting and management. Process-based accounting directly links financial data to performance data.

The key to process-based accounting is XML technology, which allows auditors to extract information from computer transactions to measure quality and quantity of work, the report said. Agencies should use their collective buying power to influence commercial off-the-shelf vendors to install XML capabilities in all new releases and upgrades, the report said.

AGA recommends agencies determine common standards for reports, increase the use of XML technology and launch a few case studies to test the new reporting system.

-M.Z. Hemmingway, FederalTimes.com

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Read the Full Report

FSIO to improve financial software certification process

The General Services Administration’s Financial Systems Integration Office (FSIO) will consider modifying the commercial financial management software testing requirements to focus only on those things that are government-specific.

Dianne Copeland, FSIO director, said June 5 that the hope is to streamline the process and focus on the nonproprietary functions of the software.

FSIO will release a new testing policy in time to start evaluating commercial products next February, she said.

FSIO incrementally tests products because new regulations or laws add new requirements, and those evaluations are for proprietary and budgetary functions.

FSIO tests more than 500 requirements, and it costs more than $2 million on average for vendors to be certified and that is a problem, one participant said during the session.

Copeland said the office will not reduce the number of requirements, but it understands it needs to streamline them.

She also said FSIO has pushed back the release date of the Financial Management Line of Business request for proposals to qualify private-sector vendors. She said her office had hoped to release the RFP by June 30, but now it will come in late July or early August. FSIO will hold a bidders’ conference July 12 and release the solicitation after that.

FSIO also will issue an updated Financial Management LOB migration planning guidance in the next few weeks. It will try to address issues such as how small agencies should implement the initiative.

-Jason Miller, FCW.com

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USDA CIO Combs to leave

Agriculture Department Chief Information Officer Dave Combs has resigned and will leave at the end of this month. He has been CIO there since 2005.

Combs earlier this week submitted his resignation, which is effective June 30. He plans to return to North Carolina.

Combs is half of one of the federal government’s power couples. Linda Combs, his wife, is controller for the Office of Management and Budget's Office of Federal Financial Management. She continues in that position, an OMB spokeswoman said today.

During his time as CIO, Combs made significant progress in information technology consolidation, data security and e-authentication across the enterprise. USDA has started examining its systems for Social Security numbers and other personally identifiable information, ahead of directions to do so from OMB. USDA also has reduced its e-mail versions and platforms to one and is working on data center and local-area network consolidations.

-Mary Mosquera, FCW.com

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Thursday, June 07, 2007

Today's GAO Publication

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

Internal Revenue Service: Status of GAO Financial Audit and Related Financial Management Report Recommendations.
GAO-07-629, June 7
http://www.gao.gov/cgi-bin/getrpt?GAO-07-629
Highlights - http://www.gao.gov/highlights/d07629high.pdf

FederalNewsRadio - Ask the CFO - John Cox (HUD)

Department of Housing and Urban Development

John Cox - Chief Financial Officer

Get your house in order. The old saying has been good advice at HUD, which this year was one of 11 agencies to get the Certificate of Excellence in Accountability Reporting (CEAR). CFO John Cox says part of the success has been due to the continuing implementation of new, better accounting systems.

But he also says another reason for HUD's improvement is the focus on communication and the weekly meeting of key C-level managers, something that helped lead to the National Housing Locator, a system that can help people left homeless by natural disasters find a place to live.

Still, running the numbers at HUD is not easy, especially when you factor in the recent shake-up of the housing market.

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Awards honor CFOs' tech achievements

The Defense Department’s Zack Gaddy was among those honored when the Washington area’s chief financial officers gathered June 5 to toast their best and brightest at the 11th Annual Greater Washington Technology CFO Awards.

Gaddy, director of DOD’s Finance and Accounting Service (DFAS), took home the first annual Phoenix Award. It recognizes the CFO from a federal agency or public or private corporation who has achieved the greatest success through finance and technology transformation.

Gaddy oversees the work of about 13,000 people at DFAS, which in 2006 doled out 145.3 million pay transactions totaling about $424 billion to 5.9 million people.

The selection committee also honored former Virginia Gov. Mark Warner with the Michael G. Devine Hall of Fame Award for career achievement. Before becoming governor in 2002, Warner co-founded the technology-based venture capital firm Columbia Capital and the company that would eventually become Nextel. As governor, he turned the $6 billion budget deficit he inherited into a surplus.

“More important than being a Democrat or a Republican, I think that there ought to be a requirement that every legislator can prove that he or she can read a balance sheet before they get elected,” Warner told the crowd as he accepted his award.

- Ben Bain, FCW.com

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FederalNewsRadio Op-Ed: Back of the Class

A heavyweight Office of Management and Budget official got an earful from the CIO of a "very small agency," as she described it.

The topic of a morning conference was shared services. That is, my agency uses your agency's shop for performing some function that's crucial but non-mission, like payroll or accounting.

Brief background: Departments have been operating shared services centers, and other departments and agencies using them, for decades. But in the last couple of years, the pressure from OMB to use shared services for a series of so-called lines of business has been on hyperdrive. All leavened, of course, with the additional mandate to consider use contractor-operated shared services.

One rationale for use of shared services is that it ought to lower costs. After all, a place that specializes in a function can offer bulk pricing, so to speak. Or so asserted Jeff Koch, the OMB point man on lines of business.

But the small agency CIO fairly fumed that shared service prices are "outrageous" and that her agency can handle its financial needs in-house, thank you very much. Of shared services she said, "I don't think it works."

Now, that's something you don't hear very often. An in-the-ranks federal career official dressing down a mighty OMB overseer. Not that Koch backed down, replying that it is "provable" that shared services are less costly.

Who knows. There are a lot of ways to calculate cost, so the arguments tend to devolve into the philosophical.

-Tom Temin, FederalNewsRadio.com

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Four Winners Named in Federal Card Deal

Citibank, GE Capital Financial, JP Morgan Chase and U.S. Bancorp on Thursday were named winners of a 10-year, multibillion-dollar government contract to provide charge card services to federal agencies.

The four companies will compete against each other to win business from more than 350 agencies that use charge cards to pay for supplies, fuel and travel, said General Services Administration officials.

There were four bidders for the GSA's "SmartPay2" project and they were all named to participate in the contract, according to the government's main contracting arm.

Monday, June 04, 2007

Personnel issues top concern for DOD financial execs

Workload pressures, aging workforce pose major challenges

Personnel issues represent the dominant concern among Defense Department financial executives, a new study found.

DOD financial executives listed workload pressures from the global war on terror and an aging workforce as overarching challenges, according to a survey released June 1 by the American Society of Military Comptrollers and Grant Thornton LLP.

Executives also said that the Defense financial community lacks clear road maps to guide professional development — despite an abundance of training programs.

Of far less concern for executives in the study were adjusting to new financial information systems and audits. On the whole, executives reported success in implementing new systems.

The survey results are based on in-person interviews with 41 executives and online interviews with 606 ASMC members. Fifty-seven percent represented the four uniformed services, 24 percent worked for the Defense Finance and Accounting Service and 19 percent were from other DOD organizations.

The survey is anticipated to be published on the Grant Thornton website on June 4th on the Global Public Sector Publications page.

-Richard Walker, FCW.com

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Friday, June 01, 2007

Education Secretary Spellings Appoints Lawrence Warder as Acting Chief Operating Officer of Federal Student Aid

U.S. Secretary of Education Margaret Spellings has designated the Department's Chief Financial Officer Lawrence Warder as Acting Chief Operating Officer of Federal Student Aid (FSA) effective today.

FSA was created by Congress in 1998 as a performance-based organization and delivers approximately $77 billion of financial aid each year to more than 10 million students and their families. In January 2005, its student aid programs were removed from the GAO High-Risk designation list after 15 years. Today, FSA delivers more aid to more students at a lower operating cost with greater accuracy than at any point in its history. In addition, FSA has continued to reduce the default portion of the student loan portfolio by nearly 40 percent since FY2000, at the same time that the overall outstanding student loan portfolio doubled.

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HUD Seeks Director for Administrative Expense Budget

U.S. Housing and Urban Development
Director, Office of Administrative Expenses
Chief Financial Officer, Office of Budget
GS-0560-15

The U.S. Housing and Urban Development (HUD) is looking for an experienced manager to direct its salaries and expenses (S&E) budget activities. HUD's mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination. This position is located in the Budget Office of the Office of the Chief Financial Officer (OCFO).The mission of the OCFO is to lead the Department's Headquarters and Field office officials toward the understanding and practice of sound financial management in program development and operations and in the stewardship of public resources.

The Administrative Expenses Division has the primary responsibility for the overall budget function related to the Department's administrative expenses appropriations/funds (Salaries and Expenses (S&E), Office of Inspector General, and Working Capital Fund). The Director, Office of Administrative Expenses, reports to the Assistant CFO for Budget and is responsible for the establishment of the overall program offices budgetary polices and procedures for the formulation of the Department's budget and submission to the Secretary, the Office of Management and Budget (OMB), and the Congressional Committees on matters relating to budgetary formulation and execution.

This position will have multiple cut-off dates. Applications received by the first cut-off date of June 1, will receive first consideration. Referrals will be issued until the position has been filled. The additional cut-off dates are June 8th, 15th, 22nd, and 29th. The link to USAJOBs for more specifics of this position follows:

http://jobsearch.usajobs.opm.gov/getjob.asp?JobID=57835760

OMB details approach for HR Line of Business migrations

The Officer of Management and Budget late last week gave agencies the how-to guide for moving to a human resources shared service provider.

The much-anticipated directive tries to answer questions regarding how OMB Circular A-76 fits into the HR Line of Business initiative as well as step-by-step directions for evaluating offers and competing work only with private-sector or public-sector providers.

In a memo to agency deputy secretaries, Clay Johnson, OMB’s deputy director for management, said the framework establishes a competitive selection process, and the opportunity to improve cost, quality and performance of shared services.

Agencies also must consult with OMB if they choose not to ask vendors on the GSA schedule to bid on their work, and if they want to have limited competition—either just public-sector or just private-sector providers.

For either noncompetitive migrations or private-sector only competitions, the agency must justify its decision which must be approved by the chief human capital officer, the CIO, CFO and the chief acquisition officer, the guidance states.

-Jason Miller, FCW.com

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