USDA Financial Systems:

Additional Actions Needed to Resolve Major Problems

AIMD-95-222: Published: Sep 29, 1995. Publicly Released: Sep 29, 1995.

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GAO reviewed whether the Department of Agriculture's (USDA) Financial Information Systems Vision and Strategy (FISVIS) project will: (1) resolve major USDA financial system weaknesses; and (2) consolidate the separate USDA financial and mixed systems that perform similar functions, as well as reengineer USDA financial processes.

GAO found that: (1) the USDA Chief Financial Officer (CFO) has demonstrated strong leadership and progress in implementing the initial phase of the FISVIS project; (2) CFO has issued departmentwide financial management standards and has signed a contract for the central Foundation Financial Information System; (3) it is unclear when USDA financial and mixed systems will be brought into compliance with the new financial standards, since CFO does not have the authority or a mechanism to enforce compliance and will have to rely on the voluntary cooperation of the USDA component agencies; (4) although USDA is planning to give CFO greater responsibility and authority over its financial systems, the major component agencies will manage their own financial systems with limited CFO oversight; (5) CFO lacks a configuration management policy and version control process for the Foundation system software to lower costs and prevent duplication; (6) FISVIS does not address eliminating or consolidating the many USDA systems that perform similar functions and has not been revised to consider reengineering financial management processes on a departmentwide basis in light of the ongoing USDA reorganization; and (7) although USDA has not addressed all aspects of its financial management systems, it plans to spend hundreds of millions of dollars to redesign or replace many of its existing financial and mixed systems.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: USDA's OCFO now participates in acquisition review teams, the information technology capital planning and investment control process and the Executive Information Technology Investment Review Board reviews, and is working with the agencies as they implement the Foundation Financial Information System (FFIS). USDA has consolidated or eliminated 46 financial systems as it has been implementing FFIS and developing other new systems. As a result, USDA now has only 69 systems; down from the ll5 reported in its FY l995 inventory. However, USDA did not undertake a systematic review of each ongoing development efforts, but rather only focused on more recently planned financial systems. Consequently, USDA has not been fully responsive and may still be missing opportunities for further consolidation.

    Recommendation: The Secretary of Agriculture should direct CFO to review each of the component agencies' on-going and planned financial management system development efforts and report to the Secretary whether each of these efforts are necessary, consistent with the FISVIS initiative, and cost-effective from a departmentwide perspective, or whether they should be consolidated with other financial management systems or development efforts. This would include, but not be limited to, determining that the component agencies' needs cannot be met by the Foundation system. If CFO determines that any individual system development effort is not needed, the Secretary should suspend it.

    Agency Affected: Department of Agriculture

  2. Status: Closed - Implemented

    Comments: USDA no longer intends to maintain a separate architecture for financial management systems. Rather, information pertaining to such systems has been rolled up into the OCIO's department-wide information architecture. The Clinger-Cohen Act required agencies to develop an overall architecture. Also, information from this architecture has been incorporated into the USDA Financial and Accounting Standards Manual. In addition, USDA is developing a departmental data warehouse to provide USDA with a data repository-integrating budget, performance, financial, and program information in support of the USDA consolidated financial statements. Establishing an architecture that includes information on financial management systems will be helpful, but doing so will not fully meet the recommendation because it is not expected to provide the detail and emphasis necessary on financial management issues to identify financial management needs and opportunities to streamline or consolidate systems.

    Recommendation: The Secretary of Agriculture should direct CFO to update the FISVIS strategy to include a financial management systems architecture that sets forth the financial management needs of the new USDA organizational structure, and establish a detailed strategy to meet these needs. This plan should also identify opportunities to streamline or consolidate financial management systems across agencies and mission areas.

    Agency Affected: Department of Agriculture

  3. Status: Closed - Implemented

    Comments: OCFO assembled a team to work jointly with the Farm Service Agency (FSA), which was planning to implement its own version of the Department's foundation financial system software. This team has developed a configuration management policy and version control process and has implemented it. With the policy and process in place, as of July 1997, USDA has made only one change to the baseline software.

    Recommendation: The Secretary of Agriculture should direct CFO to develop and implement a configuration management policy and version control process to ensure that the Foundation system baseline software is effectively managed.

    Agency Affected: Department of Agriculture

  4. Status: Closed - Implemented

    Comments: USDA established an Implementation Team for the Department's Foundation Financial Information System (FFIS) and a Standards Administration Team to work with its agencies to assess their financial systems for compliance with federal accounting standards. USDA's OIG then reviewed the agencies' assessments and identified 5 systems not in compliance with federal accounting standards. USDA and its agencies have been taking action to bring these systems into compliance. USDA's OCFO submitted a remediation plan to OMB on September 30, l998, which addresses remedial actions, completion dates, and resources needed to complete remedial actions. Also, 3 of the 5 USDA components have submitted more detailed plans. USDA's OIG is monitoring these planned actions, which are not expected to be completed until October l, 2002, and is reporting progress annually.

    Recommendation: The Secretary of Agriculture should require that CFO: (1) establish review teams to determine whether current and future USDA component agency and National Finance Center (NFC) financial and mixed systems are in compliance with the USDA Financial and Accounting Standards Manual and the USDA Financial Management Information Architecture Document; and (2) take action to bring component agencies into compliance with the standards. One way USDA could undertake this task with existing resources is to create temporary teams of Office of CFO, NFC, and component agency personnel.

    Agency Affected: Department of Agriculture

  5. Status: Closed - Implemented

    Comments: The delegation of authority which provides the CFO with authority to oversee all financial management activities, including approving component agency financial management system design and enhancement projects, was published in the Federal Register on November 8, 1995. Also, the organization plan for the Office of CFO (OCFO) was signed by the Deputy Secretary on October 6, 1995.

    Recommendation: The Secretary of Agriculture should expeditiously implement the proposed delegation of authority to provide CFO with the authority to oversee all financial management activities relating to the programs and operations of the agency, including approving component agency financial management system design and enhancement projects.

    Agency Affected: Department of Agriculture

  6. Status: Closed - Implemented

    Comments: USDA published the Department's final delegations of authority on November 8, l995. This delegation provides the department's CFO with financial management responsibilities including oversight and approval of component agency financial management budgets and approving and managing component agency financial management systems design or enhancement projects. However, the delegation of authority is silent on placing the CFO in a leadership role for developing a department-wide financial management reengineering plan and for reviewing and approving component agency and mission area reengineering efforts. Additionally, it does not require agencies' senior financial managers to work with the CFO to ensure those agencies' reengineering effort are planned and managed from a department-wide perspective. Therefore, the action taken by USDA is not fully responsive to this recommendation.

    Recommendation: The Secretary of Agriculture should delegate to CFO authority and responsibility for: (1) developing a departmentwide financial management reengineering strategy that would include identifying the technical assistance and training necessary to successfully carry out reengineering activities; and (2) reviewing and approving the reengineering of all departmental and component agency financial processes and require component agencies' senior financial managers to work with CFO to ensure that their reengineering efforts are planned and managed from a departmentwide perspective.

    Agency Affected: Department of Agriculture

 

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