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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MACFADDEN TO HOST PANEL ON DHS SHARED SERVICES MIGRATION AT 2014 AGA PDT

Macfadden & Associates, Inc. (Macfadden) will be hosting a panel presentation at the Association of Government Accountants’ 2014 Professional Development Training in Orlando, Florida. The panel presentation, titled “Shared Services Migration – Perspectives from the Department of Homeland Security’s Progression toward Financial Shared Services Solutions,” will take place on Tuesday, July 15 – Day 3 of the conference, and will feature three members of the Department of Homeland Security’s executive leadership and a director from the Department of Treasury.

Macfadden’s panel is comprised of four speakers:

1. Elizabeth Angerman, Director at Office of Financial Innovation and Transformation, Department of the Treasury
2. Jeffrey Bobich, Director of Financial Management, Department of Homeland Security
3. Captain Mark Rose, USCG Ret., Director of Financial Operations/Comptroller, U.S. Coast Guard
4. George Asseng, Director of Financial Management, Transportation Security Administration

The panel will be moderated by Doug Davidson, Director of Financial Services at Macfadden.

This panel intends to provide perspectives and insights from DHS entities proceeding toward various shared service solutions. Discussion will include lessons learned through the planning, selection, and due diligence phases of shared services migration. This session will provide the audience with real-world and current experiences from agency implementations in progress.

The annual ADA PDT brings together the top officials in federal, state and local government, as well as from academia and the private sector, for three-and-a-half days of valuable training and networking. Attendees can earn up to 24 Continuing Professional Education (CPE) hours.

This is Macfadden’s first year hosting a panel, as well as its first year as a member of the AGA’s Corporate Partner Advisory Group.

Macfadden is an employee-owned, ISO 9001:2008 certified, international professional services corporation that applies integrated information technology solutions and program/project management expertise to help solve critical issues impacting the health, safety and security of the world around us.

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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Familiar questions, few answers so far for OMB's latest financial systems effort

The departments of Commerce and Housing and Urban Development and the Coast Guard are planning to outsource their financial management systems in the coming year.

These three agencies have only one choice in how they modernize their financial management systems — through a federal shared services provider.

The Office of Management and Budget's March 2013 policycreated a federal first priority for agencies to modernize their financial management systems through a shared services provider.

But this second attempt by OMB to move agencies to financial management shared services is fraught with the same obstacles of a decade ago.

But OMB believes this attempt at shared services is different. The administration says budget concerns and technology advancements will help overcome these long- standing barriers.

OMB named five shared service providers under the Financial Management Line of Business initiative. With the exception of the Defense Finance and Accounting Service, the four civilian providers — the departments of Treasury, Transportation and Interior, and GSA — mostly found success with small and micro agencies.

But with agencies spending more than $8 billion a year on financial management systems and with more than 53,000 employees supporting those efforts, the opportunity to consolidate and simplify is great.

So administration officials say the time is right for a renewed push for shared services.

Three of the four current shared service providers for civilian agencies offer only Oracle's Federal Financial software.

GSA offers CGI's financial management software called Momentum. But industry and federal sources say GSA is likely to get out of the financial shared services this year.

Other agencies are using SAP, Savantage and other financial management software that meet federal standards.

Infor and Workday both offer software-as-a-service options for enterprise financial management services.

OMB and OFIT are close to naming new federal shared services providers, with at least one agency providing software that is not Oracle.

Federal News Radio's special series, Shared Services Revisited, looks at whether there still are too many unanswered questions that would doom shared services once again.

-Jason Miller, FederalNewsRadio.com
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Homeland Security achieves new level in auditability

The Homeland Security Department’s decade-long struggle to integrate components and achieve clean books passed a major milestone with the release this month of DHS’ annual financial report, officials told Government Executive. For the first time, the department was given a “qualified audit opinion,” having submitted five statements of financial management for review.

The key area of improvement was auditing of general property, plant and equipment management, particularly in its Coast Guard organization, officials said.

Undersecretary for Management Rafael Borras praised DHS Chief Financial Officer Peggy Sherry for her “in-depth risk assessment of the issues,” and for working “closely with our component agencies to create mitigation plans” and for meeting “regularly with component CFOs to ensure adherence to the established milestones and remediation plans.” Other partners included DHS’ Office of the Chief Procurement Officer and the Office of the Chief Readiness Support Officer.

When the department was stood up in 2003, auditors faced 30 significant deficiency conditions, of which 18 were material weaknesses, Sherry explained, so progress required work with the Homeland Security’s Office of Inspector General, Congress, the Office of Management and Budget and GAO to implement the 2004 DHS Financial Accountability Act.

When the 2011 audit produced qualified opinions in two areas, Secretary Janet Napolitano pushed for execution of a “deeper dive” into all five statements in 2012. With billions in property for the whole department spread nationwide, Sherry added, it took major collaboration to audit them all at the same time.

“The full-scope audit opinion,” Sherry said, “is confirmation of DHS’ ongoing commitment to instituting sound financial practices to safeguard taxpayer dollars. We’ve provided reasonable assurance that internal controls over financial reporting as required by law are effective. With the exceptions of a few areas, we have good business practices in place to ensure our financial statements are accurate.”

DHS’ progress in general management reforms drew praise a year ago from Comptroller Danny Werfel, but its audit issues remain on the Government Accountability Office’s high-risk list.

-Charles S. Clark, GovExec.com
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Auditors find financial system material weakness in DHS

Homeland Security Department components continue to struggle with cybersecurity controls over their financial systems, according to annual independent auditor examination of DHS financial statements.
The audit (.pdf)--an "other accompanying information" attachment to the department's fiscal 2010 financial report (.pdf)--finds that problems with information technology controls and system functionality collectively add up to a material weakness.

DHS has "systematic challenges" in complying with security policies and requires a stable and centralized financial system to fully address its problems, the audit states.

Coincidentally, DHS is pressing forward with an enterprise resource planning system meant to be just that, awarding on Nov. 19 a $450 million contract to Arlington, Va.-based CACI International to implement the system.

-David Perera, FierceGovernmentIT.com
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U.S. Coast Guard Seeks Director of Financial Operations/Comptroller

Job Title: Director of Financial Operations/Comptroller

Department: Department Of Homeland Security

Agency: U.S. Coast Guard

Job Announcement Number: CG-SES-10-02

SALARY RANGE:
119,554.00 - 179,700.00 USD /year

OPEN PERIOD:
Thursday, February 04, 2010 to Friday, March 05, 2010

SERIES & GRADE:
ES-0510-00/00

POSITION INFORMATION:
Full-Time Permanent

DUTY LOCATIONS:
1 vacancy - Washington, DC

WHO MAY BE CONSIDERED:
Applications will be accepted from all US citizens.

JOB SUMMARY:
The Director of Financial Operations/Comptroller reports to the Deputy Chief Financial Officer in the Resources Directorate of the U.S. Coast Guard (USCG). The Director of Financial Operations/Comptroller is responsible for overseeing all financial management, accounting, and financial reporting functions; directs, manages, and provides policy guidance and oversight for the USCG's financial management organization including both federal and trust funds; oversees the integration of accounting, and financial management systems within the Coast Guard, including financial reporting, and internal controls; and monitors the financial execution of the budget of the USCG in relation to actual obligations, unliquidated obligations, and expenditures.

Individuals may contact Tenika Jefferson at 202.475.5320 or by email at Tenika.M.Jefferson@uscg.mil for any questions about the position.
View the full job listing

DHS adds oversight to grants, contracts - FederalTimes.com

Top Homeland Security Department officials say their biggest near-term management priority is providing better oversight of the department's $2 billion in annual grants and nearly $15 billion in annual contracts.

The department has issued some $20 billion in grants — mostly through the Federal Emergency Management Agency — since it was created seven years ago. But DHS doesn't know whether the grants have improved security or disaster preparedness; audits by the Government Accountability Office criticized some grant programs for duplicating one another and focusing on the wrong goals.

Large contracting programs — such as the Coast Guard's Deepwater program, and the department's high-tech border security system called SBINet — often break their budgets and fall short of expectations.

Department officials say they're taking steps to fix those problems.
Elaine Duke, the department's undersecretary for management, said she's setting up a new oversight office to manage DHS grant programs. The department plans to staff the office with 20 people, and is more than halfway to that goal. Staffers will review inspector general reports on grant programs to look for problematic trends, and they'll work with managers to improve the quality of data collected about grant programs.

But grant and contract management is only one of many problems plaguing the department, according to the latest annual report from the inspector general. Information technology systems still have endemic security flaws; the department still hasn't consolidated separate IT systems from its dozens of component agencies; and financial management systems still don't interact with one another.

Experts, DHS officials and even auditors say that, despite the criticism, the department ismaking progress in areas including IT security, procurement and grants management.

In the long term, experts say, DHS will face much larger challenges in fixing its financial management systems. They received the lowest marks in the recent IG's report; Inspector General Richard Skinner said the department has made only minimal progress toward consolidating those systems. And it lacks sufficient accounting and financial management personnel to audit its financial statements.

Maurer, the GAO analyst, said many of those problems are from legacy systems at the nearly two dozen agencies that combined to form DHS. He also said the department didn't think through its needs early on — and many of the early IT systems it bought are now coming back to cause problems.

READ MORE...

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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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
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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

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 released the following publications:

Troubled Asset Relief Program: Treasury Actions Needed to Make the Home Affordable Modification Program More Transparent and Accountable.
GAO-09-837, July 23.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-837
Highlights - http://www.gao.gov/highlights/d09837high.pdf

Troubled Asset Relief Program: Status of Efforts to Address Transparency and Accountability Issues, by Thomas J. McCool, director, Center for Economics, Applied Research and Methods, before the Subcommittee on Oversight and Investigations, House Committee on Financial Services.
GAO-09-920T, July 22.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-920T

Project Bioshield: HHS Can Improve Agency Internal Controls for Its New Contracting Authorities.
GAO-09-820, July 21.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-820
Highlights - http://www.gao.gov/highlights/d09820high.pdf

Improper Payments: Responses to Posthearing Questions Related to Eliminating Waste and Fraud in Medicare and Medicaid.
GAO-09-838R, July 20.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-838R

Grants Management: Grants.gov Has Systemic Weaknesses That Require Attention.
GAO-09-589, July 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-589
Highlights - http://www.gao.gov/highlights/d09589high.pdf

Coast Guard Retiree Health Care: Coast Guard Contributions to and Payments from the DOD Medicare-Eligible Retiree Health Care Fund (MERHCF).
GAO-09-857R, July 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-857R

Federal Real Property: An Update on High Risk Issues, by Mark L. Goldstein, director, physical infrastructure issues, before the Subcommittee on Economic Development, Public Buildings, and Emergency Management, House Committee on Transportation and Infrastructure.
GAO-09-801T, July 15.
http://www.gao.gov/cgi-bin/getrpt?GAO-09-801T
Highlights - http://www.gao.gov/highlights/d09801thigh.pdf

Appropriations Decisions:

B-317821, Denali Commission--Anti-Lobbying Restrictions,
June 30, 2009
http://www.gao.gov/decisions/appro/317821.htm

Recent DHS Inspector General Reports

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

OIG-09-76 - Independent Auditor's Report on FEMA's FY 2008 Mission Action Plans included in DHS' FY 2009 Internal Control Playbook
(PDF, 21 pages - 393 KB) NEW 6/30/2009

OIG-09-73 - Independent Auditor's Report on USCG's FY 2008 Mission Action Plans included in the DHS FY 2009 Internal Control Playbook
(PDF, 16 pages - 231 KB) NEW 6/26/2009

OIG-09-75 - U.S. Coast Guard's Plan to Improve Deepwater Accountability (Letter Report)
(PDF, 8 pages - 195 KB) NEW 6/25/2009

Recent DHS Inspector General Reports

Recent Inspector General Reports for U.S. Department of Homeland Security, include:

OIG-09-58 - National Flood Insurance Program Management Letter for DHS' FY 2008 Financial Statement Audit (PDF, 20 pages - 1.54 MB)

OIG-09-59 - Information Technology Management Letter for the FY 2008 Customs and Border Protection Financial Statement Audit (Redacted)
(PDF, 81 pages - 1.27 MB)

OIG-09-61 - Independent Auditors' Report on FLETC FY 2008 Consolidated Financial Statement (PDF, 18 pages -542 KB)

OIG-09-60 - DHS' Progress in Disaster Recovery Planning for Information Systems
(PDF, 28 pages - 1,022 KB)

OIG-09-54 - Management Letter for the Audit of the Transportation Security Administration's Consolidated Balance Sheet as of September 30, 2008
(PDF, 17 pages - 1.06 MB) New 05/01/2009

OIG-09-48 - Information Technology Management Letter for the Federal Emergency Management Agency Component of the FY 2008 DHS Financial Statement Audit (Redacted)
(PDF, 43 pages - 1.46 MB) New 04/27/2009

OIG-09-47 - Information Technology Management Letter for the United States Coast Guard Component of the FY 2008 DHS Financial Statement Audit (Redacted)
(PDF, 43 pages - 965 KB) New 04/27/2009

Recent DHS IG Reports

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

OIG-09-34 - U.S. Coast Guard's Management of 2005 Gulf Coast Hurricanes Mission Assignment Funding
(PDF, 27 pages - 1.41 MB) New 03/23/2009

OIG-09-38 - Improvements Needed in Federal Emergency Management Agency Monitoring of Grantees
(PDF, 34 pages - 509 KB) New 03/24/2009

OIG-09-36 - Potentially High Costs and Insufficient Grant Funds Pose a Challenge to REAL ID Implementation
(PDF, 38 pages - 2.13 MB) New 03/24/2009

Admiral Allen Speaks to Chief Financial Officer Academy at the National Defense University

Adm. Thad W. Allen, Coast Guard Commandant, addresses speaks to a class at the Information Resource Management College Sept 24.

Watch the video here.

DHS financial systems' security questioned

Plans by agencies of the Homeland Security Department to correct security weaknesses in their financial management systems don't correct the fundamental causes of the problems. Also, the plans are not consistently updated with correct information and lack detail, according to a recent audit commissioned by DHS’ inspector general.

The consulting firm KPMG found that the Information Technology Plans of Action and Milestones (POA&M) that several DHS agencies have used to fix vulnerabilities in financial management systems were insufficient. The audit found that milestones in those plans often lacked enough information to correct problems and the schedules the agencies set are not reasonable.

DHS’ inspector general hired the company to audit the POA&M plans that the Coast Guard, Immigrations and Customs Enforcement, the Transportation Security Administration and the Federal Emergency Management Agency had for improving the security of their financial management systems. The department’s fiscal 2006 Performance and Accountability Report cited the security of the department’s financial management systems as a material weakness.

The company's auditors said they could not make a determination of what effect DHS’ efforts to consolidate its components financial management systems would have on agencies’ POA&M’s because that integration plan is still in its pre-implementation phase.

A department IG report released in May said DHS should re-examine options for its financial systems consolidation project and correct outstanding software coding issues before moving ahead with the financial system consolidation project.

The audit, which was conducted in November and December of 2007, made a series of recommendations for the components and DHS’ Office of the Chief Information Officer (OCIO) and Office of the Chief Financial Officer (OCFO). The report was released July 1.

-Ben Bain, FCW.com

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DHS financial systems project concerns IG

The Homeland Security Department should re-examine options for its financial systems consolidation project and correct outstanding software coding issues before fusing DHS components’ financial systems, according to a new report from the department’s inspector general.

DHS plans to migrate its component agencies’ financial information technology systems into two platforms — one from Oracle and one from SAP. According to the IG's report, DHS officials said they chose those platforms because they are familiar with them.

However, the IG said that in making that decision, officials did not consider solutions other agencies are using or that are available in a shared-services environment, and they should do so before moving forward with TASC.

DHS officials said they had received a verbal waiver from the Office of Management and Budget, which endorsed DHS’ decision to consolidate the systems without further competition. However, the IG said policy requires that those waiver requests be published in the Federal Register.

After a draft report was issued earlier this year, a federal claims court ruled that DHS’ decision to settle on Oracle and SAP systems was an improper sole-source procurement. It ordered DHS to hold an open competition before moving forward on the project. According to the IG report, RMTO is re-evaluating its consolidation strategy as a result of that ruling.

The IG’s review of the project also found that DHS needs to improve performance by chronicling and analyzing scripts, or software code, that have been added to the Oracle-based financial management systems of the Transportation Security Administration and the Coast Guard. The IG said those additions demonstrated that controls on the systems are not properly designed and financial data could be compromised.

The IG recommended that DHS:

• Conduct a full evaluation of financial service providers available through government agencies to see if they can meet DHS' needs more efficiently.
• Identify all scripts that the Coast Guard and TSA are using and determine their effects on the financial transactions of the agencies and DHS.
• Correct the scripts before migrating to the new financial system.

READ MORE...

Today's GAO Publication

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

Defense Management: More Transparency Needed over the Financial and Human Capital Operations of the Joint Improvised Explosive Device Defeat Organization.
GAO-08-342, March 6.
http://www.gao.gov/cgi-bin/getrpt?GAO-08-342
Highlights - http://www.gao.gov/highlights/d08342high.pdf

Coast Guard: Observations on the Fiscal Year 2009 Budget, Recent Performance, and Related Challenges, by Stephen L. Caldwell, director, homeland security and justice issues, before the Subcommittee on Oceans, Atmosphere, Fisheries, and Coast Guard, Senate Committee on Commerce, Science, and Transportation.
GAO-08-494T, March 6.
http://www.gao.gov/cgi-bin/getrpt?GAO-08-494T
Highlights - http://www.gao.gov/highlights/d08494thigh.pdf

DHS preparing for new administration

The Homeland Security Department will face a challenging year as it prepares for a new administration and works to improve an often-criticized procurement office.

“During a transition period, there’s a period of several weeks, or perhaps months, where a department is practically incapable of making a decision,” Rep. Hal Rogers, R-Ky., warned Wednesday. “We can’t afford that in Homeland Security.”

Rogers, the ranking member, spoke at a House Appropriations subcommittee on Homeland Security hearing, the first of 16 promised on the department’s management.

DHS Inspector General Richard Skinner agreed with Rogers, noting that the 5-year-old department is still “fragile.”

Comptroller General David Walker told the subcommittee he had been briefed on the department’s human capital transformation framework and was impressed with it.

Several lawmakers suggested that the department is struggling to hire qualified personnel.

“We know employee morale at the department is the lowest in the federal government,” said Rep. David Price, D-N.C., the subcommittee chairman. “We know that the department has poor procurement practices and poor financial management. I could go on.”

The hearing also touched on financial management problems at the Coast Guard. The service had hoped to certify its financial statements by 2009; the target date has since been pushed back to 2011. Skinner and Walker called for the Coast Guard to restructure its financial management office. The chief financial officer is military, not civilian, so the CFO’s office never develops stable leadership.

“I’m being introduced to my third CFO in five years,” Walker said.

-Gregg Carlstrom, FederalTimes.com
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