HUD MARKS A MAJOR SHARED SERVICES MILESTONE WITH FINANCIAL SERVICES MIGRATION

Department’s New Core Project is on a path to become first cabinet-level agency to fully migrate financial systems
WASHINGTON, D.C. – October 21, 2015 – (RealEstateRama) — Today, October 20, 2015, the U.S. Department of Housing and Urban Development (HUD) announces another major milestone in transitioning HUD’s financial management and procurement operations to the U.S. Department of Treasury’s Administrative Resource Center (ARC).  This milestone marks the shift of financial and procurement management functions from HUD to ARC. Although significant work remains, HUD is the first cabinet-level agency to move core financial systems to a Federal Shared Service Provider.In 2010, HUD reviewed its aging financial systems, and decided to transition from costly legacy systems that did not provide the necessary scale and breadth required to meet today’s financial management needs. 

This collaborative relationship between HUD and Treasury is the result of the Federal IT Shared Services Strategy. In May 2012, the Office of Management & Budget (OMB) announced the strategy to agencies for identifying and operating shared services for commodity, support, and mission IT functions. That strategy recommended a phased approach for implementing shared services, (e.g., “crawl-walk-run”) beginning with intra-agency commodity IT, to allow agencies to gain proficiency, then evolving to support and mission IT areas.

The transformative project has made significant progress to date. In October 2014, HUD began its phased implementation, migrating travel functions, and in February 2015, its time and attendance functions. Together with the most recent payment processing milestones, HUD’s New Core project continues to enhance financial transparency and analytical capabilities, increase regulatory compliance, and improve efficiency through the transition of HUD’s core financials and key administrative systems and services. 


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About HUD:

HUD’s mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business. More information about HUD and its programs is available on the Internet at www.hud.govand http://espanol.hud.gov. You can also follow HUD on twitter @HUDgov, on Facebook at  www.facebook.com/HUD, or sign up for news alerts on HUD’s News Listserv. 

About Treasury’s Administrative Resource Center (ARC):  

ARC helps customers, like HUD, focus on their mission by delivering responsive, customer-focused, cost-effective administrative support to  other federal agencies. The reimbursable administrative services that ARC provides include financial management, human resources, procurement, travel and relocation, and information technology services.  For more information please visit: our website at https://fiscal.treas.gov. 

Jereon Brown 202-708-0685 
http://www.hud.gov/news/index.cfm

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DHS faces stiff acquisition, IT management challenges, IG says

The Department of Homeland Security is facing major challenges ensuring employee accountability, streamlining acquisitions and managing its IT projects, according to an annual report released Nov. 18 by the DHS inspector general.

The IG received over 29,000 complaints against DHS employees and opened more than 1,000 investigations — achieving 300 convictions and affecting 100 personnel action. DHS must quickly recognize poor performers and illegal acts and move to stop them, the IG said.

The agency also struggles with delivering its acquisitions on time and on budget with the right capabilities, according to the report. While DHS has made some efforts to better manage its acquisitions it needs to continually improve and assess its efforts, the IG said.

DHS should also work on other management issues, including:

• Financial management: While the agency was able to obtain a clean financial audit for the second year in a row, it required considerable manual effort by the agency to overcome flaws in its financial IT systems, according to the IG. The agency needs to strengthen its financial management programs to eliminate these issues and make it easier to produce a clean audit.

• Grants management: Most of the challenges in grant management rest with the Federal Emergency Management Administration, which did not properly spend and document about 23 percent of disaster-assistance grants.

• Operations integration: The IG identified projects and programs shared between agencies that had weak levels of oversight, and that the agency does not have adequate systems to centrally track some of these shared programs. DHS spent more than $35.3 million on a fleet of cars shared between components that were underused, the IG said.

DHS agreed with many of the IG findings and said that many of the issues are being addressed by the agency-wide effort to coordinate and combine a diverse set of legacy agencies into one cohesive unit. The “Unity of Effort” initiative is building important bridges in DHS’ planning, programming and budgeting processes, according to Jim Crumpacker, the director of the departmental IG liaison office.

-Andy Medici, FederalTimes.com
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DHS management chief nominee's approach is data centric

As Russell Deyo sailed through his nomination hearing Wednesday to be the next undersecretary for management at the Homeland Security Department, his management approach and priorities centered on data.

The retired Johnson & Johnson executive told Senate Homeland Security and Governmental Affairs lawmakers that getting DHS to have standard financial data will lead to better and more strategic decision making.

If confirmed, Deyo would replace Rafael Borras, who left in February after more than four years on the job.

DHS reached a milestone in 2013 when, for the first time ever, it received an unqualified opinion from auditors for its financial management processes.

Deyo said he recognizes that accomplishment and wants to make sure DHS doesn't slip back from there. 

At the same time, he said the next step toward better financial management has to happen sooner than later.

"The next big piece, as far as I can see so far, is we need to have a fully integrated financial management system across all the components. You have to have reliable information, so you can make smart budget decisions and have good analytics to make good strategic decisions. And having ledger sheets that don't match up, and you can't compare apples to apples across the groups, makes it very, very difficult to make informed, strategic decisions," Deyo said. "I think it's critical the agency have a long-term focus, and you can't do that if you don't have reliable data. So that is an existent high priority within the finance group and indeed the leadership of the department, and I strongly embrace that."

He said during his time at Johnson & Johnson, having a common financial system was essential in making strategic decisions.

DHS is heading down a path toward reducing the number of financial management systems used by the agency. Right now, there are 13 separate systems, but three components are moving to Interior's National Business Center, including the Transportation Security Administration and the Coast Guard.

-Jason Miller, FederalNewsRadio.com
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Outdated DHS Financial Systems May Be Inhibiting Internal IT Controls, OIG Audit Says

In recent years, said a new Department of Homeland Security (DHS) Office of Inspector General (OIG) IT management report for the Fiscal Year 2013 DHS financial statement audit, “DHS’s financial system functionality may be inhibiting the agency’s ability to implement and maintain internal controls, notably IT applications controls supporting financial data processing and reporting at some components.”

“At most components,” OIG report, “the financial systems have not been substantially updated since being inherited from legacy agencies several years ago. Therefore, in FY 2013, we continued to evaluate and consider the impact of financial system functionality over financial reporting.”

In FY 2013, a total of 103 findings were issued, of which approximately 69 percent are repeated from last year.

According to the audit, approximately 35 percent of repeat findings were for IT deficiencies that management represented were corrected during FY 2013. The new findings in FY 2013 resulted both from additional IT systems and business processes within the scope of the audit this year and from control deficiencies identified in areas which were effective in previous years, and were noted at all DHS components.

Customs and Border Protection (CBP) and the Federal Law Enforcement Training Center (FLETC) had the greatest number of new findings.

OIG reported that “many key DHS financial systems are not compliant with the financial management systems requirements of the Federal Financial Management Improvement Act of 1996 and Office of Management and Budget (OMB) Circular Number A-127, Financial Management Systems, revised. DHS financial system functionality limitations add substantially to the department’s challenges of addressing systemic internal control weaknesses and limit the department’s ability to leverage IT systems to effectively and efficiently process and report financial data.”

With respect to DHS and its components’ financial systems’ IT controls, the audit “noted certain matters in the areas of security management, access controls, configuration management, segregation of duties and contingency planning.”

During the audit, “certain matters involving financial reporting internal controls (comments not related to IT) and other operational matters, including certain deficiencies in internal control” were discovered that are considered “to be significant deficiencies and material weaknesses,” and were communicated in writing to management and those charged with governance in KPMG’s Independent Auditors’ Report and in a separate letter to the Office of Inspector General and the DHS Chief Financial Officer.

-Anthony Kimery, HStoday.us
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Air Force's progress raises DoD's confidence toward audit readiness

Air Force officials say the service is making up the most ground of any of the military services as part of the push to finally get the Defense Department to successfully close its financial books.

But government auditors say this entire Pentagon effort is at risk because of shortcomings in the services' technology systems.

Jamie Morin, the assistant secretary of the Air Force for financial management and comptroller, said he is more optimistic than ever before because the service put money and people behind the problem.

Morin said during a hearing Tuesday before the Senate Homeland Security and Governmental Affairs Committee that there is an increased likelihood that the Air Force will meet the 2017 deadline to have its financial statements fully auditable and the September deadline of being able to assert audit readiness for its schedule of budgetary activity.

This is a major change since last October when Morin told Senate Armed Services Committee members that the Air Force would struggle to meet the 2014 deadline, and 2017 wasn't going to be any easier.

But over the last six months, the Air Force has accomplished specific tasks one- by-one to meet the congressionally mandated deadlines.

Each of the services and DoD on the whole remain at different points in the process to achieve audit readiness. DoD is the only federal department that can't successfully account for its spending to meet third-party auditors requirements. The Marines Corps in fiscal 2012 received an unqualified opinion on its schedule of budgetary activity (SBA) — the first DoD service ever to receive that result.

Robert Hale, the out-going DoD comptroller, said he expects the Marines Corps to earn the same result for 2013.

While each of the services is at different points, the one common major challenge the Army, Navy, Air Force and the Office of the Secretary of Defense all face is updating and integrating their technology software, specifically the enterprise resources planning (ERP) systems, to meet the audit readiness requirements.

Take the Air Force as one example. It's still using a system from 1968.

Morin said the Defense Enterprise Accounting Management System (DEAMS), is under development to replace that 40-year-old system.

He said the service received a positive assessment from the Air Force Operational Test and Evaluation Center on DEAMS as currently deployed at more than six bases.

The Air Force plans to complete DEAMS deployment to all Air Mobility Command in the next couple of weeks and then more bases by Oct. 1. Morin said the Air Force also is on track to complete deployment Air Force-wide before the full financial statement audits begin.

The Army, on the other hand, is in better shape.

Robert Speer, the Army's acting assistant secretary for financial management and comptroller, said the general fund enterprise business system (GFEBs) is used by 53,000 service members and civilians at 200 locations worldwide.

Sen. Tom Coburn (R-Okla.), the ranking member of the committee, said in no uncertain terms if the ERPs don't work, this effort is in real trouble. Coburn has asked both the IG and GAO to continue looking at DoD's ERP efforts.

-Jason Miller, FederalNewsRadio.com
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2014 AGA Federal Financial Systems Summary and Links to Presentations

Pinpointing how to address challenges through leadership for future success takes center stage

By: Joseph Davis, Marketing & Communications Manager, AGA

It’s no secret the last year has been a tough one — fiscally and otherwise — for the federal government and its supporting agencies, which highlights the tough conditions government financial managers in particular, have had to endure. Though they produce constraints, budgetary and resource limitations also create opportunities for innovation and leadership.

Addressing challenges and paving a way for the road ahead was the center of attention as nearly 400 government and private sector financial managers took part in AGA’s 2014 Federal Financial Systems Summit (FSS) last week.

“Because of fiscal constraints, we have to do everything we can to focus on ‘mission’ and leadership,” said Norman Dong, Interim Controller, Office of Management and Budget (OMB), during a panel discussion centered on, “The Vision and Roadmap for Federal Financial Management and Systems.” He stressed that with the help of shared services — which remained at the forefront of this year’s FSS — OMB, as well as other government agencies, can focus on business outcomes rather than a “check-the-box approach” to financial management processes.

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READ THE EXECUTIVE REPORT HERE...

Financial management and freedom of choice

At a time when governments are increasingly looking to private-sector solutions to improve efficiency and solve complex challenges, the Treasury Department appears to be headed in the opposite direction when it comes to shared services, with potentially disastrous results.

In April, the CIO Council published the Federal Shared Services Implementation Guide, which establishes a strategy for moving agencies to shared-services environments for business areas such as budget formulation, human resources and, notably, financial management. Charged by the Obama administration with developing an implementation strategy, Treasury's Office of Financial Innovation and Transformation (FIT) developed a plan to streamline and consolidate financial management systems by tapping federal shared service providers (FSSPs) almost exclusively.

Although consolidation might be a good idea, major concerns exist about the viability of the chosen approach.

Representatives from the Software and Information Industry Association and its member companies met with Office of Management and Budget and FIT officials to understand how their effort would improve upon previous attempts, such as the Lines of Business initiative, which ultimately failed in 2006. So far, however, those conversations have led to more questions than answers, particularly concerning the role of commercial providers in the new shared-services arrangement.

Consolidation is a noble goal but not when it flies in the face of efficiency and rationality.

In fact, OMB and Treasury recently announced plans to "assign" all agencies to an existing FSSP, deviating from the April memo and leaving commercial providers completely out of the picture. That action makes little sense in theory and is not feasible in practice. It fails to recognize the complexity of the current federal financial management system environment.

Today only a handful of the agencies covered by the Chief Financial Officers Act receive their core financial management services from an FSSP, and most of those agencies are themselves FSSPs. Even Treasury, which is implementing the initiative and has its own shared-services center, does not host the core financial management systems of three of its largest bureaus. Presumably, those bureaus were deemed too large or complex to use Treasury’s center or another FSSP.

Most agencies are running their own financial management systems powered by commercial software, and those systems largely work as intended. And we know that commercial software has the right capabilities because even the FSSPs use commercial software as their backbone.

By virtue of their size, large federal agencies cannot simply pick up their financial systems and move them to an FSSP. If the Department of Homeland Security or Defense Department tried, the provider would be completely overwhelmed by the complexity and number of financial transactions generated on a daily basis. The cost of migration would far outweigh any projected cost savings.

Consolidation is a noble goal but not when it flies in the face of efficiency and rationality. The administration needs to wake up to the fact that an agency like DHS, with a $40 billion budget and 22 component agencies, is already operating at such a large and complex scale that moving it to a new FSSP would be an unwieldy, expensive mess.

Instead, the administration should take a step back and focus on its original objectives of boosting efficiency and saving money. To start, officials must determine whether there is any evidence that we are currently wasting significant money on our financial management systems. And because commercial software powers the federal government's financial systems -- even the FSSPs -- the private sector must be included in the reform process.

Ultimately, agencies need the freedom to choose the financial management solution that is best for them. They should not be bullied into switching to an FSSP that likely won't meet their needs.

-Mike Hettinger, FCW.com
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Interior takes financial management system to an enterprise cloud

The Interior Department’s Financial and Business Management System is being migrated to an enterprise cloud run by Virtustream, the company reported.  

FBMS provides the administrative backbone to support DOI’s financial transactions, acquisitions, travel, grants and subsidies, and property and fleet management functions across 60 offices. When fully deployed, it will replace and/or integrate 160 of Interior's 162 legacy business systems and subsystems, according to the agency website.

Virtustream, a provider of cloud software and services, is working with prime contractor Unisys to move the financial management system, which is based on SAP software, to its Virginia-based data center, which complies with security guidelines stipulated by the Federal Information Systems Management Act (FISMA).

SAP application hosting is the first project Interior officials and contractors are tackling as the department expedites its move to the cloud. In August, Interior awarded a set of contracts valued at up to $10 billion to 10 vendors in a bid to transform overall IT capabilities. 

Interior expects to save $100 million each year from 2016 to 2020 by moving applications to the cloud. 

Virtustream is SAP-certified in both cloud and hosting services. The company is currently going through the process to get security accreditation for its enterprise cloud under the federal government’s Federal Risk and Authorization Management Program, said Kevin Dattolico, chief sales officer for Virtustream.

-Rutrell Yasin, GCN.com
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From 500 to 70, OMB reduces number of financial system requirements

The Office of Management and Budget actually canceled a financial management circular earlier this month.

Circular A-127 no longer governs agency financial management systems. Instead, OMB rolled a small set of these old requirements into the new Appendix D of Circular A- 123 back in September.

OMB said Appendix D went into effect Oct. 1 and therefore rescinded all previously issued versions of Circular A-127 from Dec. 19, 1984; July 23, 1993; June 10, 1999; Dec. 1, 2004; and Jan. 9, 2009.

Norman Dong, the acting controller at OMB, said the goal of the rescission of A- 127 and the new Appendix D is to improve the quality, utility and the reliability of federal financial information.

The new guidance features only 70 requirements that OMB hopes will drive agencies toward outcomes such as reporting timely financial data or eliminating waste, fraud and abuse.

Dong said Appendix D now focuses on ways agencies can gauge how well they are in meeting the requirements of the Federal Financial Management Improvement Act (FFMIA), such as the number of and nature of material weaknesses and audit opinion from the inspector general or third party analysis. Formerly A-127, and now Appendix D, help agencies implement FFMIA.

Another major change with Appendix D is the focus on shared services. OMB has strongly encouraged agencies to move to federal shared service providers for financial management when appropriate, but some of the requirements under A-123 made it more difficult.

Dong said one example of this change in approach to financial management happened when a service provider and customer agency initially had discussions about hosting the system and identified more than 700 gaps between how the customer and provider were doing business. But, he said, when they shifted the conversation away from how they were doing business and focused on what needs to be achieved, the number of differences dropped dramatically.

OMB eventually will fold Appendix D into the rewrite of Circular A-123, governing the internal controls of agency financial management.

Dong said the goal is to rationalize and harmonize OMB's guidance on federal financial management. He said it's important to make sure the requirements are reasonable and rationale.

OMB announced in February it would lead an effort to do the first major grants policy rewrite in years.

Dong said OMB will release the A-123 update in the coming months. He said OMB is conferring with agencies on a number of different aspects of the rewrite, including the improper payments requirements.

In addition to the A-123 update, OMB released a new bulletin on Oct. 21, giving agencies an updated set of minimum standards for their financial audits.

OMB made 26 changes to the 67-page document around areas such as reporting, written representation from management and the scope of the audit.

-Jason Miller, FederalNewsRadio.com
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OMB updates financial reporting rules

What: Appendix D to Circular No. A-123, Compliance with the Federal Financial Management Improvement Act of 1996

Why: Federal agencies are getting new flexibility in modernizing their financial management systems, per a Sept. 20 memo from Sylvia Burwell, director of the Office of Management and Budget.

The new framework changes the way agencies comply with the Federal Financial Management Improvement Act (FFMIA), to eliminate some restrictions on technology products and phase out a testing and certification program for the deployment of financial management software, while paving the way for the use of shared services across agencies. The OMB has also established a set of common goals for financial management across all federal agencies. The memo also charges the Treasury Department with developing requirements for federal financial management systems.

-Adam Mazmanian, FCW.com
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Morin paints challenging way ahead for Air Force's audit readiness

The Air Force is facing an ever increasing likelihood that it will not get its financial house in order by the first congressionally-mandated 2014 deadline.

By the end of this fiscal year, all of the Defense Department must be able to develop an auditable statement of budgetary resources.

But Jamie Morin, the Air Force's outgoing comptroller and President Barack Obama's nominee to be DoD's second director of the Cost Assessment and Program Evaluation (CAPE) office, told lawmakers Thursday the service would struggle to meet the 2014 deadline.

Morin said meeting the financial auditability deadlines remains an important priority for DoD and there has been real progress made over the last few years.

The Air Force's struggles are not new. Morin told lawmakers in 2011 that the Air Force's systems were among the biggest roadblocks it faces.

Lawmakers also pressed Jo Ann Rooney, the President's nominee to be the undersecretary of the Navy, on the service's ability to meet the congressional financial mandates.

Rooney said she didn't have details about the Navy's status in part because of the fiscal uncertainty that hasn't let the service hire skilled workers and plan accordingly.

Sen. John McCain (R-Ariz.) told Rooney to go back and figure out where the Navy stands on meeting the legal deadlines. He said if she doesn't know the answer, she isn't qualified to hold the undersecretary job.

With the first deadline now less than a year away, lawmakers will pay close attention to DoD's progress, and want consequences should they miss the 2017 deadline to have an auditable financial statement.

Several members of the Armed Services Committee co-sponsor the Audit the Pentagon Act of 2013, introduced by Sens. Tom Coburn (R-Okla.) and Joe Manchin (D-W.Va.). The bill states that if DoD fails to obtain a clean audit opinion by 2018, the military services would be barred from spending money to fund new major acquisition programs beyond what's known as "milestone B" — in essence, the actual engineering and manufacturing of new systems.

-Jason Miller, FederalNewsRadio.com
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OMB Circular A-123, Appendix D Becomes Effective October 1, 2013

On September 20th, the interim final version of OMB Circular A-123, Appendix D, Compliance with the Federal Financial Management Improvement Act of 1996 (M-12-23) was released.  Appendix D, effective October 1, 2013, provides additional guidance and defines new requirements for Financial Management Systems determining compliance with the FFMIA.  Appendix D rescinds all previously issued versions of Circular A-127, Financial Management Systems.

Please see http://www.whitehouse.gov/sites/default/files/omb/memoranda/2013/m-13-23.pdf for OMB Circular A-123, Appendix D.

OMB reworking financial system requirements to focus on outcomes, not inputs

CAMBRIDGE, Md.— The Office of Management and Budget is finalizing a new directive to change federal financial management processes.

The goal is to make it easier for agencies to balance their books, and for vendors to provide software to help them do that.

Adam Goldberg, the executive architect for the Treasury Department, said this new guidance, which is about 30 days or so away from being finalized and made public, would update Circular A-127.

A-127 defines the processes and policies agencies should follow when managing their financial management systems. Goldberg said A-127 instructs agencies on how to meet the requirements based on which systems meet government requirements and testing.

Goldberg said Treasury, working as OMB's implementation arm, changed the approach to determine the requirements of financial management systems.

OMB last revised A-127 in January 2009, shortly before President Barack Obama took office.

Goldberg said the Federal Financial Management Improvement Act calls for agencies to meet certain requirements in how they report financial data. The revised A-127 will tell agencies what the end results have to look like, rather than saying how or by what systems, and they can get there anyway they see fit.

He added this change likely will open the door to new vendors to provide shared services or partner with one of the four federal shared service providers for financial management.

Additionally, Goldberg said Treasury is developing a product/service catalog for financial management services.  Goldberg said the catalog pilot should be in place by the end of the calendar year.

All of these efforts build on OMB's requirement from March for agencies to move to a shared service provider for financial management when it's time to upgrade their systems.

Goldberg said reducing the number of requirements and focusing them on outcomes or outputs will make it easier to make the transition.

-Jason Miller, FederalNewsRadio.com
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OMB to test agency readiness to move to financial shared services

Agencies will have to take a test to measure just how ready they are to move their financial management system to a federal shared-service provider.

The Treasury Department's Office of Financial Innovation and Transformation (OFIT) and OMB will run the tests, which are specifically designed for large agencies, that over the past nine years have been reluctant to use these common services.

"What the test will do is we'll say, ‘What are the business requirements you have established for your financial system?' We will compare and contrast them to the requirements of a standard, common, generic shared-service provider. And the closer your requirements are to that generic shared-service provider, the higher score you will get on the test and the more amenable OMB is going to be to propose funding and approve such a system in the President's budget," said Danny Werfel, OMB's controller, in an exclusive interview with Federal News Radio. "The further you are away, the more bells and whistles, the more integrated requirements you are seeking out that makes you very different from a shared service provider footprint, the lower your score will be on the test and the more difficulty you will have in getting support from OMB for that solution."

He said the message agencies need to understand is OMB's goal is to have them use simple, non-unique and generic systems for their basic general ledger accounting system.

Werfel said OMB is developing a governmentwide policy that should be out in the next few weeks to formalize how this new process will work. OFIT will develop and initiated the test of agency business requirements.

-Jason Miller, FederalNewsRadio.com
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AGA Releases Executive Report: 2013 Federal Financial Systems Summit Summary

Nearly 500 government financial leaders gathered at AGA's Federal Financial Systems Summit (FSS) in Washington, DC to learn about and discuss the near-term and future prospects of federal financial management and systems in a budget constrained environment.  AGA released its Executive Report on the summit sessions on their website recently.

Download the Report Here...

Controller outlines strategy to simplify government

The chief impediments to streamlining federal functions are “parochial stakeholder interests” and a lack of urgency among managers implementing laws and programs, U.S. Controller Danny Werfel told a business group on Wednesday.

The solutions include relying more on independent commissions in deciding how to “rightsize and reshape” government as well as “changing the culture to channel the urgency” commonly felt during a crisis into everyday situations.

Speaking at a forum on transforming government for the 21st century sponsored by the Business Roundtable and Governing magazine, Werfel also stressed the importance of pending legislation to restore historical authority to the president to reorganize agencies. “Congress has our bill,” he said, “and the fact that the president felt strong enough to transmit it says he is committed to reshaping and resizing government. Every tool we can use should be at our disposal.”

In efforts to sell off unneeded federal real estate, he said, there’s been progress, but not enough. “We’re lagging behind,” Werfel said. “The federal government has offices in nearly every county, a pattern that emerged in the 1950s and 70s, but citizens are no longer served in a bricks-and-mortar way.”

Similarly, he pointed to “pockets of progress” in the government’s efforts at leveraging shared services and common infrastructure, as in cloud technology and the economies of scale in “buying once, using many times. But there’s still a significant opportunity for efficiencies, and if we don’t avail ourselves, it will slow us down,” he said.

Asked why the government hadn’t made more progress replacing legacy information technology systems, Werfel said there are resource and budget issues, but also “a track record of a lot of cultural and emotional toll among people who’ve seen many systems fail.” An environment encouraging modernization is vital, he said, but he has also asked agencies to get more out of their legacy systems, to make sure all are clear on what is to be gained by replacing them. Modernization “won’t go from zero to 100 mph overnight,” he said.

The second Obama administration, Werfel said, might involve improved leveraging of the work of the Government Accountability Office and inspectors general in identifying inefficiencies and determining which parochial interests are legitimate. Best-practice sharing among agencies “is also a second-term imperative,” he said. “In the first term, groundwork was laid for a lot of opportunity for a return on investment, smart investment in things like co-location, innovations, shared services, and a digital strategy for mobile devices,” he said. “We have to decide how expensive [it will be and] how long it will take to raise the customer service level.”

Werfel told the business executives they could play a key role advocating for modernization and working through the President’s Management Advisory Board.

-Charles S. Clark, GovExec.com
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Shared Services Strategy from OMB and Treasury Previewed at AGA’s Third Annual Federal Financial Systems Summit

Over 400 government financial professionals gathered at AGA’s Federal Financial Systems Summit in Washington last week to learn about and to discuss the near-term and future prospects of Federal financial management and systems in a budget constrained environment. The summit provided for an open dialogue between federal agency stakeholders, private-sector sponsors and key policymakers from the Office of Management and Budget (OMB) and the U.S. Department of the Treasury (Treasury) through town hall-style sessions where participants were encouraged to engage each other and openly express their thoughts, ideas and concerns.

Danny Werfel, Controller, OMB and Richard Gregg, Fiscal Assistant Secretary, Treasury, set the tone at the event by declaring a renewed commitment to drive federal agencies seeking to modernize their financial management systems to utilize shared services, where possible. In alignment with OMB’s Office of Electronic Government “Shared First” strategy, OMB and Treasury will be issuing new guidance very soon, and coordinating with agencies to leverage shared services for their core financial systems modernization initiatives.


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AGA Federal Financial Systems Summit

Federal Financial Systems Summit

January 10, 2013 | 6 CPE Hours Available | *FREE

Grand Hyatt Washington, DC
1000 H Street, NW

AGA is hosting a complimentary one-day event that brings together Federal financial managers and private sector executives for the third year to discuss the near-term and future prospects of Federal financial management systems in a budget constrained environment.

Speakers include:

• Daniel I. Werfel, Controller, Office of Federal Financial Management, Office of Management and Budget
• Richard L. Gregg, Fiscal Assistant Secretary, U.S. Department of the Treasury
• Steven Van Roekel, U.S. Chief Information Officer, Office of Management and Budget
• Norman Dong, Deputy Controller, Office of Federal Financial Management, Office of Management and Budget
• Mark A. Reger, Deputy Fiscal Assistant Secretary, Accounting Policy, U.S. Department of the Treasury
• Panelists representing various federal agencies.

The agenda will include:

• Update and Outlook from OMB and Treasury
• Town Hall on the Current and Future State of Federal Financial Management and Systems - Open forum discussion with the audience
• Answering the Challenge – Shared Service Provider Perspectives
  • A look at the new paradigm from multiple perspectives: Providers (SSP, and commercial providers), Software Vendors, Customers, Auditors

• Shared First: More than Just Financial Systems – Perspectives from the Federal Chief Information Officer of the United States

Register now 
* free for government professionals

CGI Cloud takes Railroad Retirement Board to the cloud for $66M

CGI Federal Inc. has won a $21 million contract to transition and host the U.S. Railroad Retirement Board’s financial management systems in the CGI Momentum Community Cloud.

This award has one implementation year, one base year and nine option years, the company said.

Under the contract, GCI will convert the legacy financial management system to its community cloud, delivering end-to-end support, such as conversion, training, change management, hosting and maintenance.

- Mark Hoover, WashingtonTechnology.com
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Senate votes to require DHS clean audit by 2013

The Homeland Security Department would be required to conduct and pass a full financial audit under a bill unanimously approved by the Senate on Wednesday.

Sens. Tom Carper (D-Del.), Scott Brown (R-Mass.) and Ron Johnson (R-Wis.) — all three high-ranking members of a Senate subcommittee on federal financial management — introduced the  Department of Homeland Security Audit Requirement Target (DART) Act late last year. The DART Act requires the agency, long characterized by the Government Accountability Office as being at high-risk for waste and abuse, to reach a clean audit opinion by 2013.

"Clean, auditable financial statements can provide the roadmap we need to identify potential savings, avoid waste and fraud, and move towards a culture of thrift," Carper, the subcommittee's chairman, said in a statement. "This bill requires some very important, but straightforward steps that will ensure the Department of Homeland Security can pass a financial audit."

The agency announced earlier this month it is audit-ready and "has made an attempt to pass a full-scope audit," according to Carper, but has yet to actually do so.

The bill also requires the agency's chief financial officer to submit to Congress a plan to modernize the agency's financial systems, which will be evaluated by the comptroller general.

A companion bill was introduced in the House by Rep. Todd Platts (R-Penn.) last summer but remains stuck in committee.

Meanwhile, earlier this week, the House passed a somewhat related measure, the DHS Accountability Act, which sets up an advisory commission to making recommend improvements in the efficiency and effectiveness of DHS management.

-Jack Moore, FederalNewsRadio.com
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