Report on the Federal
Financial Management Line
of Business
Kim Farington
Office of Management and Budget
Office of Federal Financial Management
May 2007
Improving Financial Performance
What the President’s Initiative Does:
Ensures managers have accurate and timely financial information
for decision making.
Expands Routine Data Use
FFMIA
Clean Audit Opinion
No repeat auditor Weaknesses
No Material
No Chronic or Significant
ADA Violations
Compliant
No Repeat FMFIA Section 2
Weaknesses
Non-Compliances
Meets Reporting
Deadlines
No Repeat FMFIA Section 4
Weaknesses
3
A Framework for Improving Financial
Performance
• President’s Management Agenda (PMA)
– How We Define and Measure Financial Management Success
• Reform Activities
– Priority Financial Management Initiatives that Support PMA
Objectives
• Core Activities
– The Foundation of Effective Financial Management
41
The Framework
2
FMLoB - On the Path to Reform
Pre -1990
1990
1996
1999
2004
• CFO Act passed
• No common
data standards
or processes
• No audit
requirement
• FMFIA requires
management to
review internal
controls (1982)
• Agencies acted
independently
• CFO positions
created
• CFOC
• Audit of
financial
statements
• CFO Act
mandates
Integrated
financial
management
system
• FFMIA
mandates
accounting
requirements
for financial
systems
• JFMIP/FSIO
testing
program for
systems
• OMB
requires
agencies
to use
JFMIP
tested
COTS
system
• PMA
• FMLoB
• A-123
revised
• Clinger
Cohen
6
Financial Management Line of Business
• Strategic Objective
– Implement Government-Wide solutions that
yield lower cost and risk results in financial
management activities
• Approach
–
–
–
–
Standardize financial business processes
Create government-wide accounting code
Emphasize use of Shared Service Providers
Strive for Transparency and Standardization
5
FMLoB Vision/Framework
4
Why is FMLoB different?
• Consensus exist among agencies for developing Common
accounting standards and data
• Using lessons from DoD’s SFIS project
• Many agencies want to focus on mission areas – not back-office
functions
– They can gain economies of scale and skill from use of SSPs
– SSPs are currently being used by many small and mid-sized agencies
– We want reduce risk for migration to SSPs
• Agencies want ways to reduce the costs and risks of
buying and implementing financial systems
8
The Future State
• Agencies use common accounting standards
and business processes
• Extensive use of Shared Service Providers
• Agencies report compliance with FFMIA
• Core and feeder systems are integrated
• Accurate financial information for decisionmaking
7
What We’ve Done and What’s Coming
• FMLoB Accomplishments
– Published version 1 of Migration Planning Guidance
– Common Gov’t-wide accounting code exposure draft released
– Competition Framework guidance released
– Standard Business Processes for Funds Control exposure draft released
• Upcoming Work
– Release Pay Management Standard Business Processes exposure draft
– Complete Receivables Management standard processes
– Standardize additional business processes – reimbursables, financial reporting
– Define standard interfaces from feeder to core financial systems
– Finalize IT measures and pilot collection
– Address outstanding FMLOB policy questions
9