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Monday, December 07, 2009

NASA Still Struggles with Accounting

SAN FRANCISCO — Although NASA failed for the seventh year in a row to receive a passing grade from independent auditors, the U.S. space agency has made significant progress in cleaning up its financial records, Elizabeth Robinson, NASA’s newly appointed chief financial officer, told members of the House Science and Technology Committee during a Dec. 3 hearing.

The major problem preventing auditors from Ernst & Young LLP from approving NASA’s books is the space agency’s difficulty in calculating the value of its two largest assets: the space shuttle and international space station, said Paul Martin, NASA’s new inspector general. That problem was serious enough to be deemed a material weakness because it made it impossible for auditors to determine whether information included in the space agency’s balance sheets was accurate, said Daniel Murrin, a partner in New York-based Ernst & Young.

Space agency officials have been trying to determine the value of NASA’s largest assets for years, a task complicated by the size and scope of the programs, changes in NASA’s financial systems, revised federal accounting rules and the hiring of new teams of auditors. “This tale has gone on for so many years and has so many twists and turns,” Robinson told the panel.

The issue is likely to be resolved in the near future, however, because the agency that issues guidance in this area, the Federal Accounting Standards Advisory Board, published new rules in October designed to assist federal agencies, including NASA, in calculating the cost of extremely large assets based on estimates. “The adoption of the new rule provides a unique opportunity for NASA to address the issue,” Murrin said.

In addition, the space shuttle and space station will become less prominent features of NASA’s financial accounts because the programs are nearing completion. At the end of 2009, those two programs comprised approximately 77 percent of the total value of NASA’s property, plants and equipment as well as 38 percent of the space agency’s total assets, Robinson said. Since the shuttle program is scheduled to conclude in 2010, and the space station is on a depreciation schedule that ends in 2016, NASA will not have to account for the cost of those assets much longer, she added.

Nevertheless, NASA’s financial managers are not waiting until the completion of the space station program to clear up their financial records. Instead, NASA officials testifying at the hearing were cautiously optimistic that they would be able to calculate the value of the shuttle and space station programs and obtain a clean bill of health from auditors in 2010.

Robinson also assured the committee that NASA will be better able to evaluate the cost of major assets because the space agency is better able to track financial data. “It is now standard practice in contracts to acquire the accounting information we need,” Robinson said. “Our contractors have felt the burden of giving us all of the data and have worked very closely with us to ensure it is the right data. … We feel like we are on a strong footing.”

Still, NASA financial managers have two other issues to tackle. The Ernst & Young auditors cited deficiencies in NASA’s ability to calculate its environmental liability as well as the space agency’s failure to comply with the Federal Financial Management Act of 1996.

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Today's GAO Publication

The Government Accountability Office (GAO) today released the following report related to federal financial management:



Financial Management Systems: DHS Faces Challenges to Successfully Consolidating Its Existing Disparate Systems.
GAO-10-76, December 4.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-76
Highlights - http://www.gao.gov/highlights/d1076high.pdf

Thursday, December 03, 2009

HUD Seeks Deputy CFO

The following position is posted on USAJOBS:

Position: Deputy Chief Financial Officer
Grade: ES-0505-00/00
Office: Office of the Chief Financial Officer
OPEN PERIOD: Tuesday, November 24, 2009 to Tuesday, December 15, 2009

JOB SUMMARY:
The Department of Housing and Urban Development (HUD) is the nation's housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and providing housing assistance for the homeless, elderly, people with disabilities, and people living with AIDS. The Department also promotes economic and community development and enforces the nation's fair housing laws.

This position is located in the Office of the Chief Financial Officer (OCFO). The OCFO establishes policies and standards to govern the development, maintenance, and operation of all financial management systems of the Department, including budget systems; accounting and related transaction systems; internal control systems; and financial reporting systems.

MAJOR DUTIES:
The Deputy Chief Financial Officer (CFO), under the broad policy and administrative direction of the CFO, directs, develops, administers, and evaluates budget, accounting, financial systems, and financial management services for the Department. As the ranking career departmental financial officer, the incumbent of this position also advises the CFO on budgeting, financial management, financial systems, accounting, the financial/audit status of programs, and administrative operations of the Department. The Deputy CFO develops and communicates budgetary guidance, financial management policies/procedures, and advises the CFO and top Departmental management on the requirements and implementation of the laws and regulations applicable to the incumbent's areas of responsibility. The Deputy CFO is responsible for preparing required financial reports to the President, Congress, the Office of Management and Budget, the Department of Treasury, and the Government Accountability Office. The incumbent represents the CFO at meetings and conferences within HUD, with other Federal agencies, and with representatives of the private sector on matters of interest to the CFO.

Review the position listing Here

IG Upgrades DHS Acquisition Management

The Department of Homeland Security (DHS) has improved management of its major management activities slightly over last year, making some progress in achieving its goals in acquisition management, according to a scorecard released Wednesday by the DHS inspector general (IG).

The scorecard found DHS making "moderate" progress in acquisition management, information technology management, and emergency management--indicating that DHS was meeting many of its goals in those areas but not quite achieving "substantial" success.

However, DHS is making only modest progress in grants management and financial management due to failing to meet many of its goals in those areas. The rating "modest" is one step below a rating of "limited" on the four-step scale used by the IG office to rate the categories in its report Major Management Challenges Facing the Department of Homeland Security.

Grants management and financial management were the weakest management areas for the department, the report found.

While FEMA made "moderate" progress in meeting the goals of successful disaster grants management, it made only "modest" progress in doing so for non-disaster grants.

For both, FEMA should exert more influence to implement improved oversight of subgrantees. But non-disaster grants management suffers from inconsistent and incomplete financial and program monitoring, the report found, partly because FEMA does not have enough grants management staffers to manage the programs.

Financial management at the department also remains weak, with the IG office granting a score of "modest" to the department's efforts. Both military and civilian financial systems at DHS face tremendous challenges.

The US Coast Guard has made little progress in tackling internal control weaknesses identified by an audit in fiscal 2008, the report said. Those weaknesses include a lack of an effective general ledger system and a lack of effective policies, procedures, and controls surrounding the financial reporting process.

While the Coast Guard plans to overcome many of these problems in future years, it lacked sufficient financial management personnel to resolve these issues in fiscal 2009, the report said.

With regard to its civilian financial systems, DHS has several internal control weaknesses in its financial reporting, particularly at FEMA and the Transportation Security Administration (TSA), the report said. Financial reporting actually deteriorated at US Customs and Border Protection (CBP) during fiscal 2009 as well, but problems at that agency are not as bad as problems at FEMA and TSA, the report characterized.

-Mickey McCarter, HSToday
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VA financial management system: FLITE delayed

The Veterans Affairs department has let the pilot program of a new asset management system slip by two months, just five months since the agency awarded the contract, according to a new report by the Government Accountability Office. GAO attributed the problems to inadequate staffing and poor program management.

In the report, GAO blamed General Dynamics, the contractor, for falling behind schedule.

The VA awarded the contract for the Strategic Asset Management system in April to General Dynamics in April. The system is one of two major components of VA's Financial and Logistics Integrated Technology Enterprise (FLITE), an effort to produce a department-wide integrated financial and asset management system. FLITE is one of the programs that the Office of Management and Budget has designated high risk.

The second component is the Integrated Financial Accounting System (IFAS). VA awarded a program management contract for IFAS to Booz-Allen Hamilton in March, and a pilot for that system is scheduled to begin in 2010.

The VA is the second largest federal agency, with 250,000 employees. The Veterans Health Administration operates 154 hospitals, 995 outpatient clinics, 135 community living centers, 49 residential rehab centers and 232 counseling centers. But it is plagued with inefficient and unstandardized business systems that require repeated manual entries, GAO said.

“VA has for over a decade been pursuing improvements in its business processes and replacement of its existing financial and asset management systems with an integrated financial management system,” GAO said.

The lack of an integrated financial management system has been recognized as a departmental weakness since 1991, and FLITE is the second attempt to provide one. Work on the earlier proposed Core Financial and Logistics System began in 1998 and was scheduled to be completed in 2006, but the agency dropped the program in 2004 when pilot projects revealed it would be unable to support the department’s needs.

Planning for FLITE began in 2005, with full operational implementation scheduled for 2014 at a cost of $608.7 million. As of September, the VA had spent about $91 million on the program.

The department picked the Maximo Enterprise Asset Management software suite from IBM as FLITE’s Strategic Asset Management (SAM) program, and General Dynamics IT was given the contract to implement at pilot in Milwaukee. By September, the contractor had not started 11 of 34 tasks, including a security assessment, and was behind schedule on 16 of the remaining 23 tasks, GAO said.

- William Jackson, GCN.com
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Tuesday, December 01, 2009

Federal shared services effort gets push from new executive forum

The Office of Management and Budget has said little publicly about the future of the Lines of Business initiatives that began under the previous administration.

So without specific direction, agencies are taking it upon themselves to implement these initiatives whether human resources, financial management or cybersecurity.

One new major effort is the Shared Services Forum made up of 20 agency executives with some support from industry collaborating and sharing best practices.

"It was a group of people who started talking about shared services, but [the efforts] were all over the map, and we were believers in shared services and believed there needs to be some structure to make it flourish because government can't afford to continue to have everyone build their own capabilities," says Jim Williams, the commissioner of the General Services Administration's Federal Acquisition Service.

This forum is not specific to a back office function, but instead the goal is to reach governmentwide implementation of all shared services.

Williams says the forum is developing recommendations for how to expand the use of and continue to institutionalize shared services as a concept across all agencies.

"We are making recommendations that look like cloud computing so that you can finally improve some of these services-procurement, personnel, all of the different things the government does," he says.

"We're thinking of something where there is broad access to these services, where every agency doesn't have to have their own, that it is somewhat like the government health care system where there is managed competition and not the Wild Wild West. There is a common lexicon, common measurements and common way to measure customer satisfaction."

The forum will submit their recommendations to the Office of Management and Budget's chief performance officer Jeffrey Zients. Williams says the forum members hoped to meet with Zients in November to discuss the recommendations.

Williams says some estimate that agencies can save 20-percent-to-30-percent by moving administrative services to shared service providers.

The forum also likely will recommend a dashboard to measure the impact of these services.
Williams says the forum didn't grow from the LOBs, but came to be from GSA, vendors and several agencies who provide shared services believing there is a need to collaborate and coordinate more effectively.

In fact, Williams says he prefers not to call these lines of business, but use the more common private sector term, shared services. He says there are some similarities, but the big difference is the maturity of the shared services approach.

Along with the forum, the Security LOB will issue two requests for proposals later this year for certification and accreditation services, and situational awareness and incident response services.

The Human Resources and Financial Management shared service efforts also are making progress by setting standards and determining how best to integrate existing systems.
Several other Lines of Business, including Grants and the Budget Formulation and Execution efforts, have been less active over the past year.

And the IT Infrastructure initiative is now about cloud computing as a means to consolidate desktops, networks and other infrastructure.

- Jason Miller, FederalNewsRadio.com
READ MORE or LISTEN HERE...

Monday, November 30, 2009

Recent DHS IG Reports

The following Inspector General Management Reports for U.S. Department of Homeland Security were recently published:

OIG-10-11 - Independent Auditor's Report on DHS' FY 2009 Financial Statements and Internal Control over Financial Reporting (PDF, 57 pages - 794 KB)

OIG-10-16 - Major Management Challenges Facing the Department of Homeland Security (PDF, 36 pages - 802 KB)

OIG-09-105 - CBP Needs to Improve the Monitoring of the Cash Collection Process (PDF, 21 pages - 1.24 MB)

OIG-09-104 - Audit of Application Controls for FEMA's Individual Assistance Payment Application (PDF, 23 pages - 867 KB)

Homeland Security Acquisition Manual (HSAM) (PDF, 399 pages - 6.33 MB) implements and supplements the Federal Acquisition Regulation and the Homeland Security Acquisition Regulation. Effective through HSAM Notice 09-03.

Recent GAO Publications

The Government Accountability Office (GAO) recently released the following reports and correspondence:

Information Technology: Actions Needed to Fully Establish Program Management Capability for VA's Financial and Logistics Initiative.
GAO-10-40, October 26.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-40
Highlights - http://www.gao.gov/highlights/d1040high.pdf

Recovery Act: Contract Oversight Activities of the Recovery Accountability and Transparency Board and Observations on Contract Spending in Selected States.
GAO-10-216R, November 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-216R

U.S. Government Accountability Office: Performance and Accountability Report, Fiscal Year 2009.
GAO-10-234SP, November 13, 2009
http://www.gao.gov/cgi-bin/getrpt?GAO-10-234SP

Budget Issues: Electronic Processing of Non-IRS Collections Has Increased but Better Understanding of Cost Structure Is Needed.
GAO-10-11, November 20.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-11
Highlights - http://www.gao.gov/highlights/d1011high.pdf

Indian Health Service: Updated Policies and Procedures and Increased Oversight Needed for Billings and Collections from Private Insurers.
GAO-10-42R, October 22.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-42R

Centers for Medicare and Medicaid Services: Deficiencies in Contract Management Internal Control Are Pervasive.
GAO-10-60, October 23.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-60
Highlights - http://www.gao.gov/highlights/d1060high.pdf

Federally Created Entities: An Overview of Key Attributes.
GAO-10-97, October 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-97
Highlights - http://www.gao.gov/highlights/d1097high.pdf

Monday, November 23, 2009

Government errors could mean big problems for contractors

Government errors could mean big problems for contractors

Contractors could face suspension, debarment or financial penalties if they fail to return and report an improper payment made by the government…even if the improper payment is the government’s fault.

That’s what an executive order meant to curb the government’s rate of erroneous payments will say, Peter Orszag, Office of Management and Budget director, told reporters during a Nov. 17 briefing on the value of improper payments made by the government in 2009.

In addition to penalizing contractors that fail to return improper payments, the pending executive order will curb improper payments by demanding agencies:
  • Establish a Web site to disclose and track the total amount of improper payments on a program. The Web site will include error rates by agency and program, and an email address for the public to report suspected waste, fraud and abuse.
  • Report on errors more than once a year (the current practice).
    Designate a Senate-confirmed official to be accountable for meeting improper payment reduction targets. If the agency misses targets two years in a row, the agency’s head, chief financial officer and inspector general must give OMB a plan describing why the agency failed to meet its goals and what it will do to meet targets going forward.
  • Employ new management techniques, such as forensic auditing, to detect and prevent improper payments.
  • Share data with other agencies about entities or individuals that received improper payments because they weren’t eligible for the benefits. This will prevent that entity or person from receiving improper payments from other programs.
  • Establish plans to reduce program errors that do not interfere with payments to legitimate beneficiaries.
  • Create incentives for states, agencies, and recipients to report payment errors.

Thursday, November 19, 2009

Recent GAO Publications

The Government Accountability Office (GAO) recently released the following reports, correspondences and testimonies:

Recovery Act: Recipient Reported Jobs Data Provide Insight into Use of Recovery Act Funding, but Data Quality and Reporting Issues Need Attention.
GAO-10-223, November 19.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-223
Highlights - http://www.gao.gov/highlights/d10223high.pdf

Grant Monitoring: Department of Education Could Improve Its Processes with Greater Focus on Assessing Risks, Acquiring Financial Skills, and Sharing Information.
GAO-10-57, November 19.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-57
Highlights - http://www.gao.gov/highlights/d1057high.pdf

Financial Audit: Securities and Exchange Commission's Financial Statements for Fiscal Years 2009 and 2008.
GAO-10-250, November 16.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-250
Highlights - http://www.gao.gov/highlights/d10250high.pdf

Financial Audit: Federal Housing Finance Agency's Fiscal Year 2009 Financial Statements.
GAO-10-218, November 16.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-218
Highlights - http://www.gao.gov/highlights/d10218high.pdf

Financial Audit: IRS's Fiscal Years 2009 and 2008 Financial Statements.
GAO-10-176, November 10.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-176
Highlights - http://www.gao.gov/highlights/d10176high.pdf

Financial Audit: Bureau of the Public Debt's Fiscal Years 2009 and 2008 Schedules of Federal Debt.
GAO-10-88, November 10.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-88
Highlights - http://www.gao.gov/highlights/d1088high.pdf

U.S. Government Accountability Office: Performance and Accountability Report, Fiscal Year 2009.
GAO-10-234SP, November 13.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-234SP

Department of Veterans Affairs: Improvements Needed in Corrective Action Plans to Remediate Financial Reporting Material Weaknesses.
GAO-10-65, November 16.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-65
Highlights - http://www.gao.gov/highlights/d1065high.pdf

Millennium Challenge Corporation: MCC Has Addressed a Number of Implementation Challenges, but Needs to Improve Financial Controls and Infrastructure Planning.
GAO-10-52, November 6.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-52
Highlights - http://www.gao.gov/highlights/d1052high.pdf

U.S. Postal Service: Financial Challenges Continue, with Relatively Limited Results from Recent Revenue-Generation Efforts, by Phillip Herr, director, physical infrastructure issues, before the Subcommittee on Federal Workforce, Postal Service, and the District of Columbia, House Committee on Oversight and Government Reform.
GAO-10-191T, November 5.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-191T
Highlights - http://www.gao.gov/highlights/d10191thigh.pdf

Troubled Asset Relief Program: Continued Stewardship Needed as Treasury Develops Strategies for Managing and Divesting Financial Interests in Chrysler and GM.
GAO-10-151, November 2.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-151
Highlights - http://www.gao.gov/highlights/d10151high.pdf

Integrity Committee's Process to Address Allegations of Wrongdoing by Inspectors General.
GAO-10-63R, October 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-63R

Financial Management Systems: DHS Faces Challenges to Successfully Consolidate Its Existing Disparate Systems, by Kay L. Daly, director, financial management and assurance, and Nabajyoti Barkakati, Chief Technologist, Applied Research and Methods, Center for Technology and Engineering, before the Subcommittee on Management, Investigations, and Oversight, House Committee on Homeland Security.
GAO-10-210T, October 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-210T
Highlights - http://www.gao.gov/highlights/d10210thigh.pdf

"Maximizing DOD's Untapped Potential to Improve Business Performance," by Gene L. Dodaro, acting comptroller general of the United States, before the DOD Performance Breakthrough Convention, in Lansdowne, Virginia.
GAO-10-184CG, October 14, 2009.
http://www.gao.gov/cghome/d10184cg.pdf

U.S. Department of Agriculture: Internal Control Would Improve Accountability for Certain Centrally Provided (Greenbook) Programs.
GAO-10-82, October 20.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-82
Highlights - http://www.gao.gov/highlights/d1082high.pdf

U.S. Department of Agriculture: Charges to Agencies and Offices for Centrally Provided (Greenbook) Programs for Fiscal Years 1999 through 2009 (GAO-10-83SP), an E-supplement to GAO-10-82.
GAO-10-83SP, October 20.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-83SP

The Federal Government's Long-Term Fiscal Outlook: Fall 2009 Update.
GAO-10-137SP, October 15.http://www.gao.gov/cgi-bin/getrpt?GAO-10-137SP

Defense Management: Widespread DCAA Audit Problems Leave Billions of Taxpayer Dollars Vulnerable to Fraud, Waste, Abuse, and Mismanagement, by Gregory D. Kutz, managing director, forensic audits and special investigations, before the Defense Acquisition Reform Panel, House Committee on Armed Services.
GAO-10-163T, October 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-163T
Highlights - http://www.gao.gov/highlights/d10163thigh.pdf

VA Health Care: Ineffective Medical Center Controls Resulted in Inappropriate Billing and Collection Practices, by Kay L. Daly, director, financial management and assurance, before the Subcommittee on Health, House Committee on Veterans' Affairs.
GAO-10-152T, October 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-152T
Highlights - http://www.gao.gov/highlights/d10152thigh.pdf

"Troubled Asset Relief Program: GAO's Oversight Role," by Gene L. Dodaro, acting comptroller general of the United States, before the Federal Deposit Insurance Corporation's accounting and auditing conference, in Arlington, Virginia.
GAO-10-150CG, October 1, 2009
http://www.gao.gov/cghome/d10150cg.pdf

Information Security: Concerted Effort Needed to Improve Federal Performance Measures.
GAO-09-617, September 14.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-617
Highlights - http://www.gao.gov/highlights/d09617high.pdf

Contract Management: Extent of Federal Spending under Cost-Reimbursement Contracts Unclear and Key Controls Not Always Used.
GAO-09-921, September 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-921
Highlights - http://www.gao.gov/highlights/d09921high.pdf

Fire Grants: FEMA Has Met Most Requirements for Awarding Fire Grants, but Additional Actions Would Improve Its Grant Process.
GAO-10-64, October 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-64
Highlights - http://www.gao.gov/highlights/d1064high.pdf

Improper Payments: Progress Made but Challenges Remain in Estimating and Reducing Improper Payments, by Kay L. Daly, director, financial management and assurance, before the Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security, Senate Committee on Homeland Security and Governmental Affairs.
GAO-09-628T, April 22, 2009.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-628T
Highlights - http://www.gao.gov/highlights/d09628thigh.pdf

Information Technology: Agencies Need to Improve the Implementation and Use of Earned Value Techniques to Help Manage Major System Acquisitions.
GAO-10-2, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-2
Highlights - http://www.gao.gov/highlights/d102high.pdf

Recovery Act: Funds Continue to Provide Fiscal Relief to States and Localities, While Accountability and Reporting Challenges Need to Be Fully Addressed.
GAO-09-1016, September 23, 2009.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1016
Highlights - http://www.gao.gov/highlights/d091016high.pdf

Appropriations Decisions:

B-318426, District of Columbia Courts--Authority to Pay Settlements
and Judgments, November 2, 2009
http://www.gao.gov/decisions/appro/318426.htm

Wednesday, November 18, 2009

Reducing Improper Payments

Wednesday, November 18th, 2009 at 10:25 am
Peter R. Orszag, Director, OMB

Each year, taxpayers lose billions of dollars in wasteful improper payments by the federal government to individuals, organizations, and contractors. "Improper payments" is an umbrella term that covers a number of financial transactions — overpayments to individuals or firms is one example; benefit payments to ineligible program participants is another. In 2008, improper payments totaled $72 billion; in 2009, they totaled $98 billion — an increase driven by improved detection and the significant increase in federal outlays associated with the economic downturn. These errors and mistakes are unacceptable. Taxpayers deserve to know that their dollars are being spent wisely and effectively.

In response, the President, over the next week, will sign an executive order to rein in these improper payments so that the right people receive the right payment for the right reason. The response revolves around three categories of action: boosting transparency, holding agencies accountable, and creating strong incentives for compliance. In addition to the Executive Order, Congress is making efforts to reduce fraud, waste, and abuse through improper payments. We look forward to continuing to work with Congress, including Senators Carper and McCaskill and Congressman Patrick Murphy, on this important issue.

READ MORE...

Monday, November 16, 2009

DHS financial management systems in disarray, IG says

The Homeland Security Department still has fragmented financial management systems that can't share data effectively, according to the department's inspector general and the Government Accountability Office.

DHS is working on a departmentwide process, called Transformation and Systems Consolidation (TASC), that would integrate its financial systems, currently spread across 22 agencies. But Kay Daly, director of financial management and assurance issues at GAO, said the department hasn't even identified which business processes need to be integrated into TASC.

The DHS IG, meanwhile, says many of the department's existing financial systems suffer from security flaws and an inability to communicate. "Systems are fragmented, do not share data, and over the years they have developed security flaws," said James Taylor, the department's deputy inspector general, at an Oct. 29 hearing of the House Homeland Security subcommittee on management, investigations and oversight.

Problems also plague financial systems at many agencies within DHS. The Coast Guard, for example, doesn't have policies in place for patching and upgrading its systems, or for disaster recovery; the Federal Emergency Management Agency doesn't maintain audit logs, which could help it track down the source of an intrusion.

Peggy Sherry, the department's acting chief financial officer, said DHS has established a working group — composed of managers from headquarters and individual DHS agencies — to work on consolidating financial systems. Sherry said her office also is consulting other departments to find out how they manage financial systems.

The department is planning to buy a commercial off-the-shelf (COTS) software package to integrate its financial systems.

Sherry said DHS expects to sign a contract between January and March. It will likely be a cost-plus contract. Several lawmakers at the hearing urged the department to consider a fixed-price contract, but Sherry said that would make it more difficult to buy the necessary software.

Lawmakers seemed impatient with the department's longstanding inability to integrate its financial systems and its other management processes. GAO and the IG issued a number of reports on financial management at DHS over the last few years; and many of their recommendations still have yet to be implemented.

At the Coast Guard, for example, 21 of the 22 conclusions in the most recent IG report were repeated from a previous report. GAO says none of its recommendations for the department have been fully implemented.

-Gregg Carlstrom, FederalTimes.com
READ MORE...

Financial Management Systems: DHS Faces Challenges to Successfully Consolidate Its Existing Disparate Systems.
GAO-10-210T, October 29
http://www.gao.gov/cgi-bin/getrpt?GAO-10-210T
Highlights - http://www.gao.gov/highlights/d10210thigh.pdf

Thursday, November 05, 2009

AGA Research Study Sees Benefits For Federal Governments Using Managerial Cost Accounting

Research examined managerial cost accounting practices within federal government agencies

Alexandria, VA (November 5, 2009) - A recently released research study conducted by the Association of Government Accountants (AGA), examined the status of managerial cost accounting (MCA) implementations within federal government agencies. The case studies depict entities at various stages of implementation, from one that has been in existence for more than thirty years, and other mature systems (more than ten years in existence) to some that have only just started (two years or less). The research publication, Managerial Cost Accounting in the Federal Government: Providing Useful Information for Decision Making, was released in October 2009.

Download the report (PDF)

Monday, November 02, 2009

FASAB Issues ED, New Standard on Property, Plant, Equipment

The Federal Accounting Standards Advisory Board (FASAB)has announced that the board is seeking input on the Exposure Draft (ED), Subsequent Events: Codification of Accounting and Financial Reporting Standards Contained in the AICPA Statements on Auditing Standards. The American Institute of Certified Public Accountants' (AICPA) Statements on Auditing Standards (SAS) AU section 560, Subsequent Events, includes accounting and financial reporting guidance that is not discussed in the authoritative literature that establishes accounting principles. The objective of this proposed Statement is to incorporate that guidance into the authoritative literature of the FASAB. The exposure draft requests comments by Dec. 28, 2009. The exposure draft and specific questions raised are available at the FASAB website.

In other FASAB news, FASAB issued Statement of Federal Financial Accounting Standards (SFFAS) 35, Estimating the Historical Cost of General Property, Plant, and Equipment --Amending Statements of Federal Financial Accounting Standards 6 and 23. SFFAS 35 amends SFFAS 6 and 23 to clarify that reasonable estimates of original transaction data historical cost may be used to value general property, plant, and equipment. More information can be found at http://www.fasab.gov

Tuesday, October 27, 2009

OMB wants better, faster, cheaper financial data

WILLIAMSBURG, Va. - The Obama administration has said little publicly about the assorted back office Lines of Business initiatives started under the Bush administration. Agencies and industry alike were left wondering what the plan was going forward, especially if consolidations with federal shared service providers still would be required.

At least for the financial management line of business, the Office of Management and Budget is offering some clarity.

Adam Goldberg, OMB's chief of the financial analysis and systems branch, says the LOB still is underway as it has been since 2003.

But OMB also has seen some additional potential improvements thanks to the Recovery Act.

"We have started to look at other opportunities where we could deliver financial management reforms probably a little earlier than we would be able to move all the agencies onto a consolidated financial system," says Goldberg at the 19th annual Executive Leadership Conference sponsored by IAC/ACT. "The direction we are going now is to continue with standardization and consolidation efforts and start to look at other solutions to deliver benefits to meet emerging needs like data and transparency reporting."

OMB believes the Recovery Act has shown that obtaining better and more accurate data more quickly is just the beginning.

"We want to look at other technology solutions to reduce the cost of transactions," he says. "We have to find ways to automate data from the time we get money from Congress until the time we spend it."

Goldberg adds that the Recovery Act has expanded who needs access to financial data.

"One of the things we are trying to do is understand how can we accelerate the capture and reporting of information and with Recovery Act and it's not just federal agencies that need to have access to the information to met reporting requirements, but we need to provide it out to state and localities and companies who are receiving monies under the Recovery Act to make sure they are able to fulfill the reporting requirements and make sure the numbers and reporting elements are in alignment with one another," he says.

Goldberg adds that OMB earlier in October issued the final set of standards so now agencies and industry have a complete set of financial management business process standards.

Along with these standards, agencies also received a common governmentwide accounting classification structure in 2008 to complete the updating of the federal financial management standards.

Goldberg says OMB now is leading an effort to make sure the common account classification structure and the business process standards align.

Goldberg adds that over the next six months OMB will finalize all the financial management information to ensure everything is aligned.

Vendor financial management system software providers eventually will have to meet the new standards.

As for the FM LOB, Goldberg says between 12 and 14 agencies have migrated to a shared service provider, including the Office of Personnel Management most recently.

-Jason Miller, WFED
READ MORE and LISTEN HERE

Thursday, October 15, 2009

Obama nominates Scott Quehl for Department of Commerce CFO

THE WHITE HOUSE
Office of the Press Secretary

FOR IMMEDIATE RELEASE
October 15, 2009

President Obama Announces More Key Administration Posts

WASHINGTON - Today, President Barack Obama announced his intent to nominate the following individuals to key administration posts:

* Scott Quehl, Chief Financial Officer and Assistant Secretary of Commerce for Administration, Department of Commerce

Scott Quehl, Nominee for Chief Financial Officer and Assistant Secretary of Commerce for Administration, Department of Commerce

Scott Quehl is President of Quehl Advisors, LLC, and a Senior Managing Director at Public Resources Advisory Group, providing advice to state and local governments on capital market, budgeting, and management initiatives. Quehl served as Managing Director for Tax-Exempt Capital Markets at JPMorgan Securities, Inc. While a Managing Director at Public Financial Management, Inc., he served as a management and budget advisor to several local and state authorities. During his tenure at Public Financial Management, Quehl took a leave of absence to serve as acting, then permanent, Chief Financial Officer of the Metropolitan Police Department for the District of Columbia. In the Executive Office of the President of the United States, he served as a member of the Clinton Administration in the Office of Management & Budget, Office of Federal Financial Management. Before this, he served as The World Bank's Country Officer for the Dominican Republic in a consulting capacity, co-managed the development of Secondary Education Project for the Dominican Republic, and advised the Governments of Colombia and Bolivia on the decentralization of financial and management authority to sub-national governments. He also served as a Peace Corps Volunteer in Sabanagrande, Honduras. He has written articles and reports for The World Bank Group, Brookings Review, and Government Finance Review. Quehl holds a Master's in Government Administration from the University of Pennsylvania, Bachelor's in History and Political Science from Lawrence University, and held FINRA NASD Series 24, 63, and 7 licenses while at JPMorgan.

Tuesday, October 13, 2009

Better than the Heisman

Tuesday, October 13th, 2009 at 8:07 pm
Peter R. Orszag, Director OMB

Tonight, the Senate confirmed Danny Werfel as Controller, Office of Federal Financial Management (OFFM). This is great news for OMB, as Danny brings broad experience and financial acumen to the table. His skills will be tested, as there are serious challenges facing the federal government to improve transparency and drive better results for the American people.

I’ve written before about Danny’s essential role in implementing the President’s ambitious agenda through the transition as Acting Controller, and particularly his work in implementing — with unprecedented accountability and openness — the American Recovery and Reinvestment Act.

I look forward to his leadership in furthering President’s agenda and in our work going forward; he is, as he has been, vital to what we do.

I thank his wife, Beth, and their children, Sean and Molly, for sharing Danny with us. I join everyone at OMB in congratulating Danny and his family on his confirmation.

P.S. A point of clarification: OMB’s Danny Werfel is not to be confused with Danny Wuerffel, who won the 1996 Heisman trophy as quarterback at the University of Florida, last seen in Washington as a member of the ‘Skins in 2002.

PUBLISHERS NOTE: Congratulations, Danny - Well Deserved!!!
Are you sure you don't want to play QB on the weekends, as well?

OMB Memo: Fiscal Year 2009 Audited Financial Statement Reporting Deadline

M-10-04

The Federal financial management community plays a central role in providing transparency into the Government’s finances and initiating sound processes and controls that limit spending improprieties and other forms of error and waste. With the enactment of both the Emergency Economic Stabilization Act of 2008 (EESA) and the American Recovery and Reinvestment Act of 2009 (ARRA), this role has never been more critical. The success of these programs hinge, in large measure, on the ability to accurately account for economic recovery funds, report timely and reliable information on these funds to the public, and closely scrutinize transactions so that Federal funds are spent appropriately.

In addition to these efforts, Federal financial professionals, including auditors, currently are engaged in year-end activities to finalize and publish the annual financial statements of the Government. Audited financial statements are important for communicating the financial position and fiscal health of Federal agencies. The process of preparing the financial statements and having them audited requires significant planning, technical expertise, and hard work. While the statutory deadline for agency year-end financial statements is five months after the end of the fiscal year, Federal agencies and auditors, to their credit, have completed this process within 45 days after the end of the fiscal year for each of the last four years.

It is my expectation that Federal agencies will continue to meet this accelerated timetable, and I hereby request that Federal agencies treat 45 days after the end of the fiscal year as a deadline for submitting year-end financial statements. However, I also want to urge Federal agencies to evaluate whether resources are appropriately aligned to support diligence and thoroughness in the completion of year-end audited financial statements as well as the ongoing critical financial management and audit activities related to effective implementation of economic recovery programs. In making this determination, Federal agencies should collaborate closely with their Office of Inspector General. If you believe there is a risk that your agency cannot align these resources effectively within the time constraints of this accelerated deadline, I am requesting that you consult with the Office of Management and Budget (OMB) on whether an extension of the reporting deadline for audited financial statements will help to remediate this risk.

Thursday, October 08, 2009

Recent GAO Publications

The Government Accountability Office (GAO) recently released the following reports, correspondence and testimony:

Understanding the Primary Components of the Annual Financial Report of the United States Government.
GAO-09-946SP, September 2009.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-946SP

Continuing Resolutions: Uncertainty Limited Management Options and Increased Workload in Selected Agencies.
GAO-09-879, September 24.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-879
Highlights - http://www.gao.gov/highlights/d09879high.pdf

Troubled Asset Relief Program: One Year Later, Actions Are Needed to Address Remaining Transparency and Accountability Challenges.
GAO-10-16, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-16
Highlights - http://www.gao.gov/highlights/d1016high.pdf

Troubled Asset Relief Program: Capital Purchase Program Transactions for October 28, 2008, through September 25, 2009, and Information on Financial Agency Agreements, Contracts, Blanket Purchase Agreements, and Interagency Agreements Awarded as of September 18, 2009 (GAO-10-24SP, October 2009), an e-supplement to GAO-10-16.
GAO-10-24SP, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-24SP

Federal Student Loans: Audits and Reviews of the Federal Family Education Loan and Federal Direct Loan Programs.
GAO-09-992R, September 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-992R

Fannie Mae and Freddie Mac: Analysis of Options for Revising the Housing Enterprises' Long-term Structures, by William B. Shear, director, financial markets and community investment, before the Senate Committee on Banking, Housing, and Urban Affairs.
GAO-10-144T, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-144T

Debt Management: Treasury Inflation Protected Securities Should Play a Heightened Role in Addressing Debt Management Challenges.
GAO-09-932, September 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-932
Highlights - http://www.gao.gov/highlights/d09932high.pdf

Alcohol and Tobacco Tax and Trade Bureau: Fiscal Year 2010 Proposed Licensing and Registration Fees Program.
GAO-09-1023R, September 28.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1023R

Federal Contracting: Observations on the Government's Contracting Data Systems, by William T. Woods, director, acquisition and sourcing management, before the Ad Hoc Subcommittee on Contracting Oversight, Senate Committee on Homeland Security and Governmental Affairs.
GAO-09-1032T, September 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1032T
Highlights - http://www.gao.gov/highlights/d091032thigh.pdf

Vocational Rehabilitation Funding Formula: Options for Improving Equity in State Grants and Considerations for Performance Incentives.
GAO-09-798, September 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-798
Highlights - http://www.gao.gov/highlights/d09798high.pdf

Financial Regulation: Recent Crisis Reaffirms the Need to Overhaul the U.S. Regulatory System, by Richard J. Hillman, managing director, financial markets and community investment, before the Senate Committee on Banking, Housing, and Urban Affairs.
GAO-09-1049T, September 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1049T

Appropriations Decisions:

B-318588, Department of the Army, Military Surface Deployment and
Distribution Command--Use of Appropriations for Bottled Water,
September 29, 2009
http://www.gao.gov/decisions/appro/318588.htm

Recent GAO Publications

The Government Accountability Office (GAO) recently released the following reports, correspondence and testimony:



Understanding the Primary Components of the Annual Financial Report of the United States Government.

GAO-09-946SP, September 2009.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-946SP



Troubled Asset Relief Program: One Year Later, Actions Are Needed to Address Remaining Transparency and Accountability Challenges.

GAO-10-16, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-16
Highlights - http://www.gao.gov/highlights/d1016high.pdf


Troubled Asset Relief Program: Capital Purchase Program Transactions for October 28, 2008, through September 25, 2009, and Information on Financial Agency Agreements, Contracts, Blanket Purchase Agreements, and Interagency Agreements Awarded as of September 18, 2009 (GAO-10-24SP, October 2009), an e-supplement to GAO-10-16.

GAO-10-24SP, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-24SP


Fannie Mae and Freddie Mac: Analysis of Options for Revising the Housing Enterprises' Long-term Structures, by William B. Shear, director, financial markets and community investment, before the Senate Committee on Banking, Housing, and Urban Affairs.

GAO-10-144T, October 8.
http://www.gao.gov/cgi-bin/getrpt?GAO-10-144T



Continuing Resolutions: Uncertainty Limited Management Options and Increased Workload in Selected Agencies.

GAO-09-879, September 24.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-879
Highlights - http://www.gao.gov/highlights/d09879high.pdf



Federal Student Loans: Audits and Reviews of the Federal Family Education Loan and Federal Direct Loan Programs.

GAO-09-992R, September 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-992R


Debt Management: Treasury Inflation Protected Securities Should Play a Heightened Role in Addressing Debt Management Challenges.

GAO-09-932, September 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-932
Highlights - http://www.gao.gov/highlights/d09932high.pdf



Alcohol and Tobacco Tax and Trade Bureau: Fiscal Year 2010 Proposed Licensing and Registration Fees Program.

GAO-09-1023R, September 28.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1023R



Federal Contracting: Observations on the Government's Contracting Data Systems, by William T. Woods, director, acquisition and sourcing management, before the Ad Hoc Subcommittee on Contracting Oversight, Senate Committee on Homeland Security and Governmental Affairs.

GAO-09-1032T, September 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1032T
Highlights - http://www.gao.gov/highlights/d091032thigh.pdf



Vocational Rehabilitation Funding Formula: Options for Improving Equity in State Grants and Considerations for Performance Incentives.

GAO-09-798, September 30.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-798
Highlights - http://www.gao.gov/highlights/d09798high.pdf



Financial Regulation: Recent Crisis Reaffirms the Need to Overhaul the U.S. Regulatory System, by Richard J. Hillman, managing director, financial markets and community investment, before the Senate Committee on Banking, Housing, and Urban Affairs.

GAO-09-1049T, September 29.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1049T



Appropriations Decisions:

B-318588, Department of the Army, Military Surface Deployment and
Distribution Command--Use of Appropriations for Bottled Water,
September 29, 2009
http://www.gao.gov/decisions/appro/318588.htm

Cost of 2010 census remains elusive, officials tell panel

Overseers of the 2010 census said on Wednesday that it is almost impossible to determine the total cost of the decennial count.

"At this point, it's just unknown" if the cost of the census will ultimately surpass the current estimate of $14.7 billion, Commerce Department Inspector General Todd Zinser told the Senate Homeland Security and Governmental Affairs Federal Financial Management Subcommittee, which oversees the count.

A GAO report released at the subcommittee's hearing showed that the first major operation conducted by census workers -- the "address canvassing" campaign to confirm millions of addresses nationwide -- went $88 million over budget, or 25 percent of costs.

Once expected to cost $11.5 billion, estimates of the funds required to conduct the count jumped last year after a failed effort to equip census workers with handheld computers.

Census Director Robert Groves, who took the reins of the bureau in July, acknowledged last month that the agency is revising its methods of cost modeling.

-Carrie Dann, GovExec.com
READ MORE...

Monday, October 05, 2009

GAO Issues Guide to Understanding U.S. Financial Report

The Government Accountability Office (GAO) has issued "Understanding the Primary Components of the Annual Financial Report of the United States Government." GAO says to goal of the guide is "to make available to every American a comprehensive overview of the federal government's finances."

Federal Stimulus-Monitoring Website Gets An Update

Since February, when the government launched a website to provide a window on the federal stimulus package, critics have been calling for a makeover. Now they have one. The site, unveiled today by the Recovery Accountability and Transparency Board, was revamped through the use of $9.5 million in stimulus funds. It provides easier-to-use tools, such as a ZIP Code search that shows stimulus projects in specific communities. The government also has set up a toll-free hot line (1-877-FWA-DESK) for reporting fraud, waste and abuse. "This is definitely a step in the right direction," said Craig Jennings, a policy analyst at OMB Watch, a nonprofit government watchdog group. Still, the Obama administration has a ways to go to complete transparency, Jennings said. The site, Recovery.gov, does not include complete data on recipients of stimulus money, and users face significant hurdles to accessing the information that is available. --Joe Markman, The Los Angeles Times
READ MORE

Wednesday, September 30, 2009

Danny Werfel Approved by Senate Committee

The Senate Homeland Security and Governmental Affairs Committee unanimously approved the nomination of Danny Werfel to be Controller of the Office of Management and Budget's Office of Federal Financial Management. Committee chair Joe Lieberman, I-Conn. said that, as deputy controller and acting controller, Werfel "has demonstrated his commitment to improving the financial management of the federal agencies and is a well-qualified choice to lead OMB's efforts in this area." He said Werfel should be confirmed by the full Senate, and quickly.

-Elizabeth Newell, GovExec.com

AGA's FMSB Comments on GASB Proposal

AGA's Financial Management Standards Board (FMSB) has issued a comment letter to the Governmental Accounting Standards Board (GASB) on its exposure draft of a proposed statement on Accounting and Financial Reporting for Service Concession Arrangements

Monday, September 28, 2009

OMB will create new performance management framework for agencies

The Office of Management and Budget is developing a new federal performance management framework, the government's chief performance officer told lawmakers on Thursday.

The approach will incorporate elements from other initiatives, including the Bush administration's Performance Assessment Rating Tool and the 1993 Government Performance and Results Act, OMB's Jeff Zients told a Senate subcommittee.

Zients has recruited Shelley Metzenbaum to help lead the effort to design the plan. Metzenbaum founded the Collins Center for Public Management at the McCormack Graduate School of Policy Studies at the University of Massachusetts, Boston. She also has served as executive director of the Executive Session on Public Sector Performance Management at Harvard University's John F. Kennedy School of Government.

After three months as chief performance officer and deputy director for management, Zients said his "initial sense" is Congress and previous administrations have laid a strong foundation for the improvement of government performance. He named GPRA and PART in particular as important starting points. The programs, however, place too much emphasis on producing performance information for the purpose of compliance, and pay too little attention to analyzing and acting on the information collected, he said.

Despite the advances made by the Clinton and Bush administrations, agencies now need to focus on using performance information as a tool to facilitate long-term strategic decisions and support employees, contractors and other stakeholders, he said. The administration will rely heavily on information technologies to accomplish those goals, he added.

Bernice Steinhardt, GAO director of strategic issues, said the commitment of agency leaders and the communication of that commitment to managers were crucial to ensuring performance information drives decision-making. GAO studies have demonstrated that a lack of commitment from agency leadership often leads to inconsistent use of performance data across the agency.

READ MORE...

Friday, September 25, 2009

Recent GAO Publications

The Government Accountability Office recently released the following publications:

Troubled Asset Relief Program: Status of Efforts to Address Transparency and Accountability Issues, by Gene L. Dodaro, acting comptroller general, before the Senate Committee on Banking, Housing, and Urban Affairs.
GAO-09-1048T, September 24.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1048T

Results-Oriented Management: Strengthening Key Practices at FEMA and Interior Could Promote Greater Use of Performance Information.
GAO-09-676, August 17.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-676
Highlights - http://www.gao.gov/highlights/d09676high.pdf

Government Performance: Strategies for Building a Results-Oriented and Collaborative Culture in the Federal Government, by Bernice Steinhardt, director, strategic issues, before the Subcommittee on Federal Financial Management, Government Information, Federal Services, and International Security, Senate Committee on Homeland Security and Governmental Affairs.
GAO-09-1011T, September 24.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1011T
Highlights - http://www.gao.gov/highlights/d091011thigh.pdf

DCAA Audits: Widespread Problems with Audit Quality Require Significant Reform.
GAO-09-468, September 23.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-468
Highlights - http://www.gao.gov/highlights/d09468high.pdf

DCAA Audits: Widespread Problems with Audit Quality Require Significant Reform, by Gregory D. Kutz, managing director, forensic audits and special investigations, and Gayle L. Fischer, assistant director, financial management and assurance, before the Senate Committee on Homeland Security and Governmental Affairs.
GAO-09-1009T, September 23.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1009T

Recovery Act: Funds Continue to Provide Fiscal Relief to States and Localities, While Accountability and Reporting Challenges Need to Be Fully Addressed.
GAO-09-1016, September 23.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1016
Highlights - http://www.gao.gov/highlights/d091016high.pdf

Recovery Act: Funds Continue to Provide Fiscal Relief to States and Localities, While Accountability and Reporting Challenges Need to Be Fully Addressed (State Appendixes).
GAO-09-1017SP, September 23.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-1017SP

Troubled Asset Relief Program: Status of Government Assistance Provided to AIG.
GAO-09-975, September 21.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-975
Highlights - http://www.gao.gov/highlights/d09975high.pdf

Low-Income and Minority Serving Institutions: Management Attention to Long-standing Concerns Needed to Improve Education's Oversight of Grant Programs.
GAO-09-309, August 17.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-309
Highlights - http://www.gao.gov/highlights/d09309high.pdf

Ryan White CARE Act: Effects of Certain Funding Provisions on Grant Awards.
GAO-09-894, September 18.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-894
Highlights - http://www.gao.gov/highlights/d09894high.pdf

Pension Benefit Guaranty Corporation: More Strategic Approach Needed for Processing Complex Plans Prone to Delays and Overpayments.
GAO-09-716, August 17.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-716
Highlights - http://www.gao.gov/highlights/d09716high.pdf

Management Report: Opportunities for Improvements in FDIC's Internal Controls and Accounting Procedures.
GAO-09-943R, September 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-943R

DOD Business Systems Modernization: Navy Implementing a Number of Key Management Controls on Enterprise Resource Planning System, but Improvements Still Needed.
GAO-09-841, September 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-841
Highlights - http://www.gao.gov/highlights/d09841high.pdf

Mineral Revenues: MMS Could Do More to Improve the Accuracy of Key Data Used to Collect and Verify Oil and Gas Royalties.
GAO-09-549, July 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-549
Highlights - http://www.gao.gov/highlights/d09549high.pdf

Royalty-in-Kind Program: MMS Does Not Provide Reasonable Assurance It Receives Its Share of Gas, Resulting in Millions in Forgone Revenue.
GAO-09-744, August 14.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-744
Highlights - http://www.gao.gov/highlights/d09744high.pdf

Monday, September 21, 2009

Government management of real property improves slightly, report says

Agencies shed less than 1 percent of their total real property assets in fiscal 2008, according to the Federal Real Property Report released on Monday.

The annual report, produced by the interagency Federal Real Property Council, said the federal government's fiscal 2008 real property profile consists of almost 896,000 buildings and structures, with a total area of 3.29 billion square feet and more than 41 million acres of land.

The slight decrease in assets and area in fiscal 2008 from the previous year can be attributed to a number of factors, including the disposal of 24,682 assets in fiscal 2008, space consolidation efforts and improved data collection and reporting quality.

The report showed that agencies continue to struggle with finding the proper use of their real property, among other issues. Fifty-three percent of the 268,000 buildings that reported data were being properly used. Slightly less than one-third of the federal facilities were being overused, while 13 percent were underemployed and 7 percent were not being used at all.

Management of real property has been a challenge for the government. In January 2003, the Government Accountability Office put the issue on its high-risk list because of "long-standing problems with excess and underutilized property, deteriorating facilities, unreliable real property data and overreliance on costly leasing."

GAO repeatedly has reported that the federal real property portfolio reflects an outdated business model based on the technological and transportation environment of the 1950s. With guidance and assistance from the Office of Management and Budget, agencies have tried to improve real property management.

-Elizabeth Newell, GovExec.com
READ MORE...

Wednesday, September 16, 2009

Nominee lays out priorities for federal financial management

President Obama's pick to be the government's top financial executive on Wednesday told senators he would focus on reducing improper payments and managing stimulus spending if confirmed.

Danny Werfel, nominated to be head of the Office of Management and Budget's Office of Federal Financial Management, told the Senate Homeland Security and Governmental Affairs Committee eliminating inefficient spending, including payment errors and investments in unnecessary real property, would be a priority.

Other goals include controlling the cost of financial management operations and modernizations; improving grants management; strengthening financial statement audits at individual agencies and governmentwide; and meeting the Obama administration's transparency requirements, especially for Recovery Act spending, he said.

Werfel, who served as the principal deputy to the controller since March 2006 and completed several stints as acting controller, told the committee government is headed in the right direction. OMB has worked with agencies to reduce payment errors in previously measured programs, shed unneeded assets, improve audit results and make more financial information publicly available, the nominee noted.

While facing systemic and persistent challenges, the financial management office must tackle additional situational challenges such as those presented by the Recovery Act and the Troubled Asset Relief Program. These programs "demand more detailed and timely financial reporting and more sophisticated risk management approaches to be successful," he told senators.
Werfel said he would address these "sweeping challenges" by working with financial managers to move beyond the basics of accounting and reporting to more strategic thinking on how to improve the value of government services; control the cost of operations; prevent waste, fraud and abuse; and improve financial transparency.

Werfel has worked with agencies to initiate risk management processes for their stimulus efforts. He has asked them to identify areas rife with potential for financial errors and has helped them to develop risk mitigation plans. For example, a program that has received 500 to 600 times its normal level of funding as a result of the stimulus act and has not received significant staff boosts, would be susceptible to erroneous payments and should develop a plan for confronting that challenge, he said.

The tools necessary to meet financial management goals are at the government's disposal, according to Werfel. These range from detailed inventories of improper payments and unnecessary real property to technologies that support transaction processing.

Sen. Tom Carper, D-Del., acting as chairman of the Senate committee, joked that the sparse attendance at the hearing was a good sign that Werfel's nomination was noncontroversial, and praised Werfel's experience.

-Elizabeth Newell, GovExec.com
READ MORE...

Monday, September 14, 2009

AGA's Regional Dialogues Reveal ARRA Spawning Lasting Changes

Regional intergovernmental dialogues recently sponsored by AGA in four cities across the country reveal that the American Reinvestment and Recovery Act of 2009 (ARRA) is sweeping, not only in its size and complexity, but also in the impact that it is likely to have on government operations both now and in the future. New processes, procedures and tools developed to implement ARRA are reshaping intra- and intergovernmental relations and the ways that governments collect, maintain and report information.

The dialogues revealed that--despite the federal government's concerted efforts to promote intergovernmental collaboration--the complexity involved in implementing such a sweeping, highly-funded act in a short period of time has resulted in some key questions remaining unanswered at press time. These questions are captured in a report issued this week by AGA.

Read the Report Here

Sunday, September 13, 2009

CIA Seeks a Contract Auditor

Support our acquisition community and serve your nation as you conduct contract audits for the CIA. All applicants must be U.S. citizens who can successfully complete a thorough medical exam, polygraph interview and extensive background investigation. An equal opportunity employer and a drug-free work force.
To apply, visit: www.cia.gov

Financial Accountability at the DoD: Reviewing the Bidding

The Chief Financial Officers (CFO) Act of 1990 requires the DoD to produce private sector-style financial statements that can win unqualified opinions from auditors. After many years of effort to comply, the department is now projecting that its balance sheets will not be ready until 2017 and is unable to predict when its income statements will be ready. Given that discouraging situation, combined with the increasingly widespread realization that external financial statements are of no practical use for internal management, the question arises whether it makes sense for the DoD to continue its pursuit of “CFO compliance.” A review of the history of the CFO strategy suggests the DoD needs to shift its efforts to the development of managerial cost accounting—not private sector-style financial accounting—if progress is to be made.

-Christopher Hanks

READ MORE...

Thursday, September 10, 2009

Recent GAO Publications

The Government Accountability Office (GAO) recently released the following publications:

Recovery Act: States' and Localities' Current and Planned Uses of Funds While Facing Fiscal Stresses, by J. Christopher Mihm, managing director, strategic issues, before the Senate Committee on Homeland Security and Governmental Affairs.
GAO-09-908T, September 10.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-908T
Highlights - http://www.gao.gov/highlights/d09908thigh.pdf

Social Security Disability: Additional Performance Measures and Better Cost Estimates Could Help Improve SSA's Efforts to Eliminate Its Hearings Backlog.
GAO-09-398, September 9.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-398
Highlights - http://www.gao.gov/highlights/d09398high.pdf

United States Merchant Marine Academy: Internal Control Weaknesses Resulted in Improper Sources and Uses of Funds; Some Corrective Actions Are Under Way.
GAO-09-635, August 10.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-635
Highlights - http://www.gao.gov/highlights/d09635high.pdf

Tuesday, September 08, 2009

Treasury Retreats From Standoff With TARP Watchdog

WASHINGTON -- The Treasury Department backed away from a standoff over the independence of the special government watchdog appointed to scrutinize how last year's $700 billion financial-industry bailout is being spent.

Neil Barofsky, special inspector general for the Troubled Asset Relief Program, a position also known as Sigtarp, declared victory Wednesday in his effort to clarify that he doesn't answer to Treasury Secretary Timothy Geithner.

Mr. Barofsky has gained a reputation for his aggressive posture and demands for information from government officials and Wall Street. The former federal prosecutor is charged with tracking the money spent to prop up the banking system during the financial crisis and to report the results of his audits directly to Congress.

In a letter Wednesday to members of Congress, Mr. Barofsky said the Treasury had withdrawn an earlier request to the Justice Department seeking a legal opinion on how much independence the Sigtarp office enjoys. Mr. Barofsky had told lawmakers he feared that being subject to the Treasury secretary's supervision would be "a threat to our independence."

By Evan Perez and Deborah Solomon
The Wall Street Journal, Page A3

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Friday, September 04, 2009

Is GAO Always Objective?

Forty years ago, at a Senate Government Operations Committee hearing on the role of GAO, Sen. Alan Cranston of California (a former state comptroller) observed that when GAO is asked to evaluate programs the GAO itself has recommended, objectivity problems can arise. As Sen. Cranston put it at the hearing: “If they [GAO officials] make a recommendation and it is adopted by Congress, they then have a sort of vested interest in that particular program, and their independence and ability to judge are somewhat impaired and, I think, less reliable.”

By: Christopher Hanks, Ph.D.

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Wednesday, September 02, 2009

Senior agency leaders focus on measuring success of their programs

In keeping with what the Obama administration sees as a high priority, officials at the Labor, Agriculture and Veterans Affairs departments are making program and performance evaluation a key focus in their strategic planning. Agencies already have been working hard narrow down their top objectives -- like the Agriculture Department's push to ensure all children in America have access to safe and nutritious meals -- and now they are tackling the even more difficult task of determining how to measure success.

Well into the process of submitting high-priority performance goals to the Office of Management and Budget, senior officials say they are identifying their program objectives and designing ways to evaluate progress toward those outcomes.

Labor will create a new position -- chief evaluation officer -- and a corresponding office within the policy office. The chief evaluation officer will develop a strategic approach that ties together the diverse goals and priorities of the department's many agencies and offices.

At Agriculture, Deputy Secretary Kathleen Merrigan's staff aims to establish metrics that can accurately measure success and to make sure each metric involves multiple agencies and mission areas.

Veterans Affairs Deputy Secretary W. Scott Gould said the elevator test applies to budgetary questions as well as metrics.

"There are three basic questions when you go see an appropriator -- what are you buying, how much does it cost and what do I get for it," he said. "If you can't answer that question in 30 seconds, it's on to the next line item."

Gould, Merrigan and Harris all anticipate the budget environment will be increasingly Spartan in the coming years, making program evaluation even more important.

-Elizabeth Newell, GovExec.com

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Thursday, August 20, 2009

Labor’s New Financial System

The end of the federal fiscal year is tough enough, but come Oct. 1, Dept. of Labor CFO Lisa Fiely is overseeing the implementation of a new agency financial system.

Lisa says the agency is installing Oracle Federal Financials Release 12, the second federal agency to use that version. She’s also working to distribute $34 billion the agency has received in Recovery Act money, although a large amount is being added to already existing programs. “Like everyone, we want to get the money out quickly, but we’re taking extra steps to make sure it’s out helping the economy before we report as such.”

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Same Old Money Problems at CNCS, Part II

Audit shows lack of scrutiny of grantees' financial skills

The second report in two weeks about financial management problems at the Corporation for National and Community Service, the parent agency of AmeriCorps, has been issued by the agency's Office of Inspector General; this one is about the lack of scrutiny given new grantees' financial expertise.

Primarily, the audit found, the agency relies on the grantees' own assessment of their financial abilities - as reported on a Financial Management Survey each must complete - but provide little or no follow-up assistance, even to those groups that say they do not have the capabilities to comply with all the federal management regulations.

In addition, the audit found it was unclear if CNCS personnel had even looked at the most of those required Financial Management Surveys. And though the surveys were supposed to be part of a grantee's record, those forms could not be located for 15 percent of the grantees they reviewed.

Just as the special evaluation of the 2008 budget process - requested by the House Appropriations subcommittee that oversees the agency and released earlier this month - found many of the same profound management deficiencies that had been identified five years earlier, the latest audit identified as continuing problems many of the same ones that were found in a similar audit more than a decade ago.

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Tuesday, August 18, 2009

CFO Academy - Preparing Tomorrow's Federal Financial Leaders

Guest: Ricardo Aguilera, U.S. Department of Defense Comptroller Chair, CFO Academy

Deloitte SME: Edward Van Buren, Principal, Deloitte Consulting LLP

In fall 2008, the National Defense University's Information Resources Management College opened a Chief Financial Officer Academy at Fort McNair in Washington, DC, featuring Pentagongraduate level courses for government financial managers. The CFO Academy's purpose is to prepare middle- to senior-level members of the federal financial community for senior 21st Century management and leadership responsibilities.

The Academy offers a variety of courses to prepare financial leaders, including lessons in accounting and finance, budget and cost analysis, internal controls and auditing, financial systems, and resource management.

The courses lead to a certificate in CFO leadership.

To learn more about the Academy visit www.ndu.edu/irmc.

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Monday, August 17, 2009

Recent DHS OIG Reports

Recent Inspector General Reports and Resources for U.S. Department of Homeland Security:

OIG-09-93 - Review of U.S. Coast Guard Enterprise Architecture Implementation Process
(PDF, 25 pages - 481 KB) NEW 8/17/2009

OIG-09-74 - Advisory Report: Department of Homeland Security's Capabilities to Implement the American Recovery and Reinvestment Act of 2009
(PDF, 17 pages - 2.69 MB)

Recent GAO Publications

The Government Accountability Office (GAO) recently issued the following publications:

Presentations By The Acting Comptroller General

1. "Ensuring Accountability in a Time of Financial and Fiscal Stress," by Gene L. Dodaro, acting comptroller general, before the American Institute of CPAs' National Governmental Accounting and Auditing Update Conference, in Washington, D.C. GAO-09-930CG, August 10, 2009.
http://www.gao.gov/cghome/d09930cg.pdf

2. "Ensuring Accountability in a Time of Financial and Fiscal Stress," by Gene L. Dodaro, acting comptroller general, before the National Association of State Auditors, Comptrollers, and Treasurers' 2009 annual conference, in Dearborn, Michigan. GAO-09-952CG, August 17, 2009
http://www.gao.gov/cghome/d09952cg.pdf

Appropriations Decisions:

B-318386, U.S. Fish and Wildlife Service--Steller's and Spectacled
Eiders Conservation Plan, August 12, 2009
http://www.gao.gov/decisions/appro/318386.htm

Because considerable conservation efforts over several years have
not halted the decline of two threatened eider species, GAO will
not object to the U.S. Fish and Wildlife Service's (FWS) proposed
use of appropriated funds to purchase and distribute caps and other
items to residents of Alaska North Slope communities in furtherance
of the agency's eider conservation plan. FWS will print images of
the threatened eiders on these items and, for some items, include
eider conservation messages. The items, which FWS will distribute
as part of agency outreach events, will help residents identify the
threatened species and serve as reminders of the agency's
conservation message.

B-318325, National Indian Gaming Commission--Reimbursing Bicyclists
as Part of the Agency's Transportation Fringe Benefit Program,
August 12, 2009
http://www.gao.gov/decisions/appro/318325.htm

Under the federal government's transportation fringe benefit
program, as established by 5 U.S.C. sect. 7905 and Executive Order
No. 13150, the National Indian Gaming Commission (NIGC) provides
monthly transit subsidies to employees who certify that they use
mass transit to commute to and from work. NIGC may use its
authority under 5 U.S.C. sect. 7905 to extend the program to
provide a $20 cash reimbursement to those employees who commute to
and from work by bicycle. If NIGC chooses to do so, NIGC should
consider the provisions of the Internal Revenue Code, 26 U.S.C.
sect. 132(f)(5), and guidance provided by the Internal Revenue
Service and the Office of Management and Budget.

Other Decisions:

B-317634, Inclusion of Public-Private Partnership Roadways in
Calculating Total Lane Miles When Apportioning Highway Trust Funds,
August 17, 2009
http://www.gao.gov/decisions/other/317634.htm

Responding to a request for an opinion from Senator Bingaman,
Chairman, Subcommittee on Energy, Natural Resources and
Infrastructure, Committee on Finance, GAO has issued an opinion
concluding that the Department of Transportation ("DOT"), in
calculating highway lane miles under 23 U.S.C. § 104(b) as part
of its annual apportionment of highway funds to states, may
properly include mileage for roadways operated or maintained
by private third parties under long-term public-private partnership
agreements with a state (so-called 'P3 agreements')

Sunday, August 09, 2009

NC State Accounting Professor Appointed to FASAB Board

D. Scott Showalter, teaching professor in the Department of Accounting at North Carolina State University College of Management and retired partner at KPMG LLP, was appointed to a five-year term on the Federal Accounting Standards Advisory Board (FASAB). His term began July 1, 2009. The appointment was announced recently by Tom Allen, FASAB chairman.

Also appointed was Michael H. Granoff, Ernst & Young Distinguished Centennial Professor of Accounting and a University Distinguished Teaching Professor at the University of Texas at Austin.

An Appointments Panel advises the FASAB Sponsors on appointments and re-appointments for the six nonfederal members of the Board. The FASAB Sponsors – Timothy F. Geithner, the Secretary of the Treasury; Peter R. Orszag, the director of the Office of Management and Budget; and Gene L. Dodaro, the Acting Comptroller General of the United States - made the final appointments.

Regarding the appointments, Allen said, “I am pleased to welcome both Michael and Scott to the Board. Michael is uniquely qualified as an academic who authors both governmental and financial accounting textbooks. Scott is a recognized leader in the field, having been with KPMG for more than 30 years including service as the public sector industry leader for the firm. Michael’s service on the Association of Government Accountants’ Financial Management Standards Board and Scott’s position as the co-editor of “Government Accounting and Auditing Update” from 1996 – 2008 demonstrates that they have both followed the most recent work of the FASAB. I am confident that Michael and Scott will hit the ground running, enabling the Board to continue its work on critical federal financial reporting issues under consideration.”

About FASAB

Accounting and financial reporting standards are essential for public accountability and for an efficient and effective functioning of our democratic system of government. Thus, federal accounting standards and financial reporting play a major role in fulfilling the government's duty to be publicly accountable and can be used to assess the government’s accountability and its efficiency and effectiveness, and the economic, political, and social consequences of the allocation and various uses of federal resources. The FASAB issues federal accounting standards after following a due process consistent with the Memorandum of Understanding under which it operates. Due process includes consideration of the financial and budgetary information needs of citizens, congressional oversight groups, executive agencies, and the needs of other users of federal financial information.

Thursday, August 06, 2009

More problems reported with Defense Contract Audit Agency

For the second time in as many years, investigators at the Government Accountability Office have found widespread deficiencies in audits conducted by the Defense Contract Audit Agency, according to internal memos obtained by Government Executive.

GAO issued a draft copy of its report on DCAA's internal control reviews to Defense Secretary Robert Gates on Monday, the memos state. The watchdog reportedly found major problems with the agency's adherence to government auditing standards. The findings are reminiscent of a July 2008 GAO report, which sparked a contentious congressional hearing and a massive overhaul of agency performance standards.

In the most recent GAO review, investigators examined 37 audit reports issued between 2004 and 2006. These reports were chosen for further examination because DCAA leadership had previously "opined the system under review was adequate," the memos said.

"GAO found [Generally Accepted Government Auditing Standards] issues with all audit reports reviewed," the memos said. "The extent of the GAGAS deficiencies varied by assignment. GAO believes there were some cultural issues within DCAA that will take several years to change, that contributed to the deficiencies noted. As you know, DCAA has implemented a number of changes that are helping to address the cultural issues."

Government Executive was unable to obtain a copy of the draft GAO report. According to the memos, DCAA field office personnel have not seen the report either. A GAO spokesman declined to comment, noting that the draft report has not been finalized.

-Robert Brodsky, GovExec.com
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Feds Release Final Data Definitions for Stimulus Reporting

The Obama administration this week released final definitions for stimulus spending information that state and local governments must report to the U.S. Office of Management and Budget (OMB) to comply with the American Recovery and Reinvestment Act (ARRA).

A 22-page document posted to recovery.gov provides detailed descriptions for nearly 100 data elements that recipients of ARRA funds will report to the OMB by Oct. 10, the first quarterly deadline for submitting stimulus spending information to the federal government. Among other things, the document -- Recipient Reporting Data Model v3.0 -- spells out how to report the status of ARRA-funded projects, the number of jobs created by these activities and payments made to vendors.

A post on the administration's Recovery.gov Web site describes the document as a "preview" of the final data definitions, and adds that actual templates for submitting ARRA data will be available soon. Recipients of ARRA funds will submit the data electronically through a new Web site called FederalReporting.gov.

-Steve Towns, GovTech.com
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