Financial Management Conference Scheduled

The Joint Financial Management Improvement Program–a joint program of the Treasury, GAO, OMB and OPM–will hold its annual Federal Financial Management Conference on May 8 at the Ronald Reagan Building and International Trade Center in Washington, D.C.

“This one-day conference provides a forum for those in the federal financial management community to learn about current issues, exchange knowledge, and share experiences in improving financial management operations and policies,” according to the announcement.

Also, the organization is soliciting nominations through March 7 for the annual Donald L. Scantlebury Memorial Award, which recognizes “senior financial management executives who, through outstanding and continuous leadership in financial management, have been principally responsible for significant economies, efficiencies and improvements in the government.”

Further information is on the CFO Council site.

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GAO: Many federal financial books are so sloppy they can’t be audited

The Government Accountability Office says many federal agencies’ financial books are in such bad shape that they cannot be audited.

In a report released last week, the GAO said material weaknesses in accounting procedures “hamper the federal government’s ability to reliably report a significant portion of its assets, liabilities, costs and other related information.”

The GAO said its report on the U.S. government’s consolidated financial statements for fiscal years 2015 and 2016 “underscores that much work remains to improve federal financial management.” The agency couldn’t even express an opinion on the balance sheets because of the weak financial reporting.

GAO noted that 34 percent of the federal government’s reported assets and 18 percent of its reported net cost relate to federal entities that were unable to issue audited financial statements, were unable to receive audit opinions on the complete set of financial statements or received a disclaimer of opinion on their statements.

The GAO called out the Department of Health and Human Services and Department of Defense, in particular, for weak internal controls.

The agency also took a shot at the Department of the Treasury and the Office of Management and Budget, noting that some of the “numerous recommendations” GAO made to those agencies in previous years to address internal control deficiencies remain unaddressed. The secretary of the Treasury and director of OMB are required to annually submit financial statements for the U.S. government, audited by the GAO, to the president and Congress.

-Johnny Kampis, Watchdog.org
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FY2015 US Federal Financial Statement Audit Due Monday

The audited financial statements of the 24 CFO Act agencies and participating federal organizations & commissions are due to be published on Monday November 16, 2015.

The following urls provide starting points to locate the publications.

http://www.performance.gov/
http://www.gao.gov/key_issues/federal_financial_accountability/issue_summary
http://www.treasury.gov/about/budget-performance/annual-performance-plan/Pages/default.aspx
@FedCFO



  

GAO released the revised Green Book, standards to help agencies achieve goals and safeguard resources

Internal control helps an entity run its operations efficiently and effectively, report reliable information about its operations, and comply with applicable laws and regulations. The Standards for Internal Control in the Federal Government, known as the "Green Book," sets the standards for an effective internal control system for federal agencies.

2014 Green Book Overview 

2014 Green Book

Massive inconsistencies continue to affect USASpending.gov data

Agencies have not been properly reporting their grants and loans to USASpending.gov, according to the Government Accountability Office. A probe of data on the website found that only 2-to-7 percent of awards listed were entirely consistent when checked against agencies records.

"Although agencies generally reported information for contracts to USASpending.gov, they did not properly report information on assistance awards, totaling nearly $619 billion," GAO said in its report it released Friday.

GAO said the most common data inconsistency were descriptions of an award's place of performance. The names of recipients are the most consistent between records and online. GAO could not determine how consistent other award records were because agencies' records were incomplete or inadequate.

The report said 10 percent of awards information could not be verified and a significant amount of information could not be verified about program source information and the state of performance.

Among the inconsistencies, GAO found that some online awards records did not have verifiable data from their issuing agencies. The Office of Management and Budget placed requirements on agencies to ensure their data has substantiated information and verifying documents, but GAO said the standards have not been effective.

Federal funding of the improperly reported awards totaled $619 billion. GAO recommended OMB issue guidance clarifying agencies' reporting requirements.

It also wants agencies to keep better records to verify information on USASpending.gov and wants an oversight process to regularly check consistency between the records.

GAO's report is not the first time USASpending.gov has come under fire. In 2013, OMB gave agencies a November 2014 deadline to assure that all information on the site is accurate.

- Ariel Levin-Waldman, FederalNewsRadio.com
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DOT Official Brodi Fontenot Nominated as Treasury Dept CFO

Brodi Fontenot, currently a Transportation Department official, has received a presidential nomination to serve as the Treasury Department‘s next chief financial officer, the White House announced Thursday.

Fontenot’s roles at DOT include assistant secretary for administration, chief human capital officer and senior sustainability officer.

He joined that agency in 2009 as deputy assistant secretary of management and budget after serving on the Senate Budget Committee’s staff for three years.

Between 2001 and 2006, he worked as a Government Accountability Office analyst and helped the agency with budgeting, disaster assistance and housing matters.

He holds a master of public administration degree from the University of North Carolina and a bachelor’s degree from the University of Houston.

-Mary-Louise Hoffman, ExecutiveGov.com
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Treasury Dept IT System Flagged for Security Issues

Serious tech troubles at the Treasury Department are so severe that they could disrupt accounting practices within a system that manages about $16.7 billion of federal debt.

The Government Accountability Office flagged at least 20 problems within the Bureau of the Fiscal Service’s tech system—all of which involve security management issues. Of the deficiencies GAO identified, 14 are brand new and six are problems that were detected in 2012 and were never corrected.

The auditors said the issues constitute a "significant deficiency" for financial reporting purposes. 

The weaknesses "increase the risk of unauthorized access, modification or disclosure of sensitive data and programs, which could result in the disruption of critical operations," Gary Engel, GAO director for financial management and assurance, wrote in an audit last week, NextGov first reported.

The Fiscal Service commissioner addressed the auditor’s findings and said the agency is currently taking actions to resolve the issues.

-Brianna Ehley, TheFiscalTimes.com
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Bill to track every federal dollar headed to Obama’s desk

The House on Monday gave final congressional approval to a bipartisan bill that would require federal agencies to report all of their expenditures online in a single location, sending the measure to the White House for President Obama’s signature.

Both chambers of Congress passed the DATA Act unanimously this month, representing a rare showing of widespread agreement between Democrats and Republicans. Sens. Mark Warner (D-Va.) and Rob Portman (R-Ohio) sponsored the legislation.

Rep. Darrell Issa (R-Calif.), who sponsored a similar measure in 2011 with Rep. Elijah Cummings (D-Md.), described the DATA Act as “a win for good government, moving the federal bureaucracy into the digital age and setting the stage for real accountability.”

Transparency advocates have complained that federal agencies rarely make spending data readily available under the current system. The Data Transparency Coalition applauded the House vote on Monday, calling on Obama to sign the bill and commit the Office of Management and Budget to “pursue robust standards throughout federal financial, budget, grant and contract reporting.”

Comptroller General Gene Dodaro, who heads the Government Accountability Office, said during testimony this month that the DATA Act is the “single biggest thing” lawmakers could do to identify wasteful federal spending.

-Josh Hicks, WashingtonPost.com
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Federal watchdog says SEC security issues put financial data at risk

A congressional watchdog has tasked the U.S. Securities and Exchange Commission (SEC) with addressing a number of security weaknesses impacting its system.

On Thursday, the U.S. Government Accountability Office (GAO) released a report (PDF) detailing the issues, which included SEC not encrypting sensitive data, properly identifying and authenticating users, or securely configuring a vital financial system, leaving it vulnerable to attack.

According to the 25-page report, “the information security weaknesses existed, in part, because SEC did not effectively oversee and manage the implementation of information security controls during the migration of this key financial system to a new location."

The watchdog said that SEC did not adequately oversee a contractor it hired to migrate its systems to a different data center last June.

As a result of SEC's need to improve security controls, GAO determined that the agency – which regulates the securities market, including exchanges, brokers, dealers and investment firms – had a “significant deficiency in internal control over financial reporting for fiscal year 2013.”

-Danielle Walker, SCmagazine.com
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Financial management providers ill-equipped to take on large customers

A metric of success for federal shared services is how many agencies are using the capability. Federal financial management shared service providers are facing an uphill battle to meet that metric.

One of the biggest challenges to making this second attempt at financial management shared services in the last decade successful is federal providers' ability to ramp up in a timely manner.

Interior, Transportation, Treasury and possibly as many as four other agencies are gearing up to accept 40,000 or more new customers at a time over the course of the next few years.

As federal financial management shared services providers, these agencies need help in the form of changes to law and policy to meet those goals.

Experts say only by letting these providers act more like private sector businesses will federal shared services find success.

In part 2 of the special report, Shared Services Revisited, Federal News Radio explores the long-standing capacity challenges that current and new financial management shared service providers will have to overcome in the coming years to meet the growing demands of agency customers.

The Office of Management and Budget requires agencies to modernize financial management systems only through federal shared service providers (SSPs). In a March 2013 memo, OMB detailed its plans to reduce costs and duplication across the government through the use of federal SSPs.

But many of the same questions limited the success of this initiative in the mid-2000s, including whether the shared service providers have the capacity to handle large cabinet level agencies.

Over the course of the last seven years, no cabinet level agency moved to a federal shared service provider. The Labor Department outsourced to a private sector provider. The Small Business Administration unsuccessfully followed suit to a different private sector company.

But over the course of the next five to 10 years and starting this year with the departments of Commerce and Housing and Urban Development, and the Coast Guard, large agencies are expected to let go of their financial management systems and take advantage of a multi-tenant set up that is widely considered an industry best practice.

OMB and Treasury's Office of Financial Innovation and Transformation (OFIT), which is managing the financial management shared services initiative, are trying to address the challenges providers face.

But it's about more than just money and people. The question is whether Interior, Transportation, Treasury or any of the new providers can handle more than one large agency every few years.

Federal and private sector experts say migrating to a shared service provider is extremely complex.

Beth Angerman , the director of OFIT, said OMB and OFIT will not mandate where agencies migrate to, but there are factors that agencies must take into account.

"We recently finished the design of the FIT Agency Modernization and Evaluation (FAME) process. What that process consists of are a series of evaluative models and artifacts that are produced by the agency with FIT's oversight and assistance to help them get through different gates of identifying if there is a federal shared service provider who will meet their needs," Angerman said.

OMB estimates agencies are spending $8 billion a year and have more than 53,000 people supporting all federal financial management systems.

There is a long history of financial management systems that have failed to meet expectations. In fact, OMB in 2010 reviewed 30 financial systems to ensure they were meeting cost, schedule and performance goals, and ended up rebaselining several after finding they were off track.

Despite this increased oversight, the Government Accountability Office found in 2012 that the reviews had little effect. Auditors said 13 projects estimated no change in their long term costs, and 16 said their schedule remained the same.

So given all of these systemic problems, Angerman said the private sector has to appreciate the changes that are happening, meaning once they were implementing large scale systems, and now they are supporting the agency providers with specific expertise.

-Jason Miller, FederalNewsRadio.com
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GAO Seeks Comments on Green Book Exposure Draft

GAO has issued its Green Book Exposure Draft, 
Standards for Internal Control in the Federal Government: 2013 Exposure Draft, 
GAO-13-830SP

Federal Managers' Financial Integrity Act (FMFIA) requires that federal agency executives periodically review and annually report on the agency's internal control systems. FMFIA requires the Comptroller General to prescribe internal controls standards. These internal control standards, first issued in 1983, present the internal control standards for federal agencies for both program and financial management.

Green Book revisions undergo an extensive, deliberative process, including public comments and input from the Green Book Advisory Council. GAO considers all Green Book comments and input from the Green Book Advisory Council in finalizing revisions to the standards.

It is available for public comment until December 2nd.
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GAO's Green Book standards near first revision since 1999

The Green Book, the Government Accountability Office's standards for internal control, is nearing its first revision since 1999.

GAO released a draft (.pdf) of the updated standards Sept. 3. The Green Book outlines the concepts and principles of internal control, which GAO defines as the policies and procedures an organization uses to carry out its objectives.

The standards described in the Green Book are about as broad as that definition. In the draft, GAO divides the standards into five sets of principles, one of which instructs management to demonstrate a commitment to integrity and ethics, establish expectations of competence, and enforce accountability.

The general concepts in the draft are not different from the 1999 version (.pdf), GAO says, but the enumerated principles are a new approach that define the standards in greater detail.

In the draft, GAO requests comments from federal officials, accounting professionals, academics and whoever else is interested by Dec. 2. The forthcoming revision to the Green Book will be the third since 1983, when GAO first issued (.pdf) the standards.

- Zach Rausnitz, FierceGovernment.com
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Department of Defense to Use Invoice Processing Platform (IPP) for Intra-governmental Buy/Sell Transactions

In 2012, Treasury launched a proof-of-concept pilot using IPP to help federal agencies manage intra-governmental buy/sell transactions. Several agencies participated in the pilot, including the Department of Defense (DoD), who found that IPP helped increase visibility into intra-governmental buy/sell transactions, as well as helped with difficult, labor-intensive reconciliation and elimination efforts.

On August 5, 2013, the Under Secretary of Defense (Comptroller) issued a memo that it is partnering with the U.S. Department of the Treasury to implement the Invoice Processing Platform as DoD’s core system to manage all inter- and intra-governmental transactions and documentation. According to the memo, this partnership will strengthen management and accountability for nearly $273 billion in intra-governmental business.

The phased implementation will initially include only DoD-to-DoD transactions. At a later date, transactions between DoD and its civilian trading partners will be included. Excluded from this effort are commercial transactions (which will continue to be managed using DoD’s Wide Area Workflow) and DoD's interfund transactions.

The buy/sell process between government agencies has been fraught with challenges. A 2013 GAO audit of the U.S. Government's Fiscal Years 2012 and 2011 Consolidated Financial Statements (report GAO-13-271R) found a $20.2 billion difference in intra-governmental buy/sell activity and balances. It also revealed that the reconciliation process for buy/sell transactions was difficult and labor intensive.

IPP supports more efficient intra-governmental buy/sell transactions between federal agencies by helping ensure consistent communication between trading partners and providing visibility into each stage of the transaction.

To view the DoD memorandum regarding the implementation of IPP for intra-governmental buy/sell reimbursable transactions, please visit:http://www.ipp.gov/downloads/DoD_Memo.pdf

For more information on the DoD IPP intra-governmental buy/sell implementation, contact the DoD Business Integration Office (BIO)

at (703) 697-1096.

For more information on IPP’s intra-governmental capabilities, contact Michael Bolin at michael.bolin@fms.treas.gov.

For more information about the features and benefits of IPP’s intra-governmental module, visit: http://www.ipp.gov/about-ipp/intra-governmental.

- Federal Reserve Bank of Boston / Treasury FMS
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GAO is Seeking to Hire its Next Chief Administrative and Financial Officer (CAO/CFO)

The Chief Administrative and Financial Officer (CAO/CFO) reports directly to the Comptroller General (CG) and, as such, is principally responsible for directing the administrative and financial services that support GAO through subordinate offices, which include the Financial Management and Business Operations Office, Human Capital Office, Information Systems and Technology Services Office, Infrastructure Operations Office, and the Field Operations Office.  The CAO/CFO also provides direction to the Professional Development Program; which is designed to orientate and develop newly hired analysts into GAO through rewarding job experience and quality training.

PROFESSIONAL AND TECHNICAL QUALIFICATIONS (PTQs):
To be considered, all candidates must submit written responses to each PTQ.

• Broad experience and in-depth understanding of strategic and operational planning; and the development and/or implementation of a multi-year strategic plan that includes and defines the financial, human capital, information technology and administrative management needs of an agency.
• In-depth knowledge of and broad experience in budgeting, financial reporting concepts and principles and internal management control and accountability processes; and thorough knowledge of governmental financial management processes.
• Extensive experience leading and managing financial and administrative programs and activities; including multi-year, multi-million dollar federal projects.

Compensation: $119,554 to $174,000, plus eligibility for performance bonus.

EEO: All candidates will be considered without regard to race, gender, age, religion, sexual orientation, national origin, or disability. GAO provides reasonable accommodations to applicants with disabilities.

Deadline: To be considered, complete applications must be submitted to JDG Associates by 11:59 PM (EST), July 22, 2013.

Citizenship: U.S. Citizenship required.

Contact:

Joe DeGioia

JDG Associates, Ltd.

1700 Research Boulevard

Rockville, MD  20850

301-340-2210

degioia@jdgsearch.com

DoD using flawed approach to calculate $1.1B in improper payments

The Defense Department reported making just $1.1 billion in improper payments in fiscal 2011, a small fraction of the Pentagon's total outlays of more than $1 trillion.

But, in a new report, the Government Accountability Office said those estimates are neither reliable nor statistically valid because of "longstanding and pervasive" weaknesses in DoD financial-management practices as well as specific deficiencies in the department's procedures for estimating improper payments.

Lacking in DoD's current efforts to curb improper payments are basic quality-control measures, Asif Khan, GAO's director of financial management and assurance, told In Depth with Francis Rose. (Federal News Radio's DoD Reporter Jared Serbu served as guest host)

-Jack Moore, FederalNewsRadio.com
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Financial management takes center stage as agencies root out wasted billions

Government spending is changing — drastically. You know. You are experiencing sequestration, having to figure out how the $1.2 trillion in cuts under the Budget Control Act will affect your agency. And now, with the recently-passed fiscal 2013 funding bill, there's more data on where your budgets drop next. All of these, really, are just taking bites around the edges of the nation's $16 trillion deficit.

But there's a shimmering light at the end of the tunnel held by someone with the tools, the understanding and the prominence to restore the government's financial environment. That's right, I'm talking about your agency's chief financial officer.

No, not the stereotype you're thinking; green eye shade, hiding behind his or her calculator and counting every dollar through some unknown formula on an Excel spreadsheet. Don't get me wrong, those people still exist in every organization — and are needed. But, I'm talking about a new breed of CFO in whom are combined the mad science of Victor Frankenstein, the prescience of Gordon Moore (hint: Moore's law), and the efficaciousness of Robert Livingston (think: Louisiana Purchase).

Federal News Radio's week-long, on-air and online series, "Rise of the Money People: Financial management moves front and center as agencies make the final assault on wasted billions," zeros in on CFOS and their soldiers who are in the financial wars, their strategies and tactics for waging the fight, the current and emerging weapons in their arsenal and how their future battles will unfold.

-Lisa Wolfe, FederalNewsRadio.com
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NLC Training Event's Common Theme: Collaboration and Efficiency

Last week, more than 700 government finance professionals gathered to learn from management leaders representing OMB, GAO and other federal agencies about what to expect in the coming days as the sequestration deadline looms.  The published report includes summaries of the keynote speaker's presentations.

Download the Report Here...

Federal News Radio coverage of the 2013 AGA National Leadership Conference

The Association of Government Accountants' National Leadership Conference brings together financial-management experts from across government to share best practices and to discuss the latest management and accountability techniques.

The 2013 Association of Government Accountants National Leadership Conference was held Feb. 12-13 in Washington, D.C. Federal News Radio attended the event and spoke with several of the key speakers ahead of their respective panel discussions.

- FederalNewsRadio.com
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IRS program, interagency contracting finally removed from High-Risk list

Interagency contracting and the IRS Business Systems Modernization program are no longer considered high risk initiatives by the Government Accountability Office.

GAO removed these two programs from its biennial High Risk Listreleased today.

The multi-billion dollar IRS program made it off the list after 18 years of constant challenges around technology and financial management controls, and other management weaknesses.

The GAO put the management of interagency contracting on watch in 2005 because of unclear lines of accountability between customer and assisting agencies, and improper use of these contracts, which included buying out-of-scope work and limited or non-competitive procurements.

GAO said both the IRS and the Office of Federal Procurement Policy have improved the weaknesses so the programs now are considered to be on a strong path toward success.

-Jason Miller, FederalNewsRadio.com
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Today's GAO Publication

Financial Regulatory Reform: 
Regulators Have Faced Challenges Finalizing
Key Reforms and Unaddressed Areas Pose Potential Risks, 
GAO-13-195, January 23
http://www.gao.gov/products/GAO-13-195