Department of Housing and Urban Development: Status of Efforts to Implement an Integrated Financial Management System
GAO-03-447R
Published: Apr 09, 2003. Publicly Released: Apr 09, 2003.
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Highlights
Weaknesses in the Department of Housing and Urban Development's (HUD) financial management systems have been a long-standing challenge for the department and have contributed to our designating two of its major programs areas as high-risk and the financial management information systems in particular as a major management challenge. While some progress has been made, both GAO and the HUD Office of the Inspector General (IG) have reported extensively on weaknesses related to HUD's financial management systems. In audits of HUD's consolidated financial statements, the IG has consistently identified several material internal control weaknesses resulting from inadequate financial management systems. In recent audit reports, the HUD OIG also noted that the completion of the development of adequate financial management systems is the most critical need faced by HUD in improving its financial management control environment. Responsive financial management systems are particularly critical to HUD's ability to meet its mission, deliver key services, and establish sufficient management control over its operations. In light of these issues, Congress asked that we (1) summarize HUD's past efforts to implement an integrated financial management system, (2) identify the challenges HUD faces with its current financial management systems, and (3) determine the status of HUD's current efforts to identify and address its financial management systems needs.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Housing and Urban Development | To help ensure the success of future systems implementation efforts, the Secretary of the Department of Housing and Urban Development should make the modernization and integration of the department's financial management systems a continuing top priority and direct the Chief Financial Officer to work collaboratively with the directors of the department's components. |
Closed – Implemented
HUD established an executive level advisory committee including the heads of HUD's major components (FHA & Ginnie Mae) and key program offices (PIH, CPD, OCFO, PDR, and OCIO) to help oversee its Integrated Financial Management Improvement Project (HIFMIP). The IG has an advisory role. The initial meeting of this group was held in 2003 and group meetings are still ongoing. A working level group was also formed, comprised of financial and IT representatives from HUD's major program offices. The kick off meeting for this group was held on April 22, 2003 and meetings continue to occur. The formation of these groups and their top-level direction satisfy the intent of our recommendation that the CFO work collaboratively with the directors of HUD's components and that the CFO obtain stakeholder involvement.
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| Department of Housing and Urban Development | To help ensure the success of future systems implementation efforts, the Secretary of the Department of Housing and Urban Development should make the modernization and integration of the department's financial management systems a continuing top priority and direct the Chief Financial Officer to acquire a qualified and experienced project manager. |
Closed – Implemented
In response to this recommendation, the Department of Housing and Urban Development (HUD) hired a systems implementation Project Manager in February 2003. GAO met reviewed the project manager's resume and determined that the individual had extensive project manager experience, both in the private and public sector, including at the Bureau of the Census and the U.S. Mint. Consequently, this recommendation has been adequately addressed.
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| Department of Housing and Urban Development | To help ensure the success of future systems implementation efforts, the Secretary of the Department of Housing and Urban Development should make the modernization and integration of the department's financial management systems a continuing top priority and direct the Chief Financial Officer to obtain stakeholder involvement. |
Closed – Implemented
HUD Integrated Financial Management Improvement Project (HIFMIP). HUD established an executive level advisory committee including top-level representatives from not only the OCFO, but also the heads of HUD's major components (FHA & Ginnie Mae) and key program offices (PIH, CPD, PDR, OCIO). Meetings of this group are still ongoing. Also in 2003, HUD established a working level group was also formed, comprised of both financial and IT representatives from HUD's major program offices. This group also continues to meet periodically. The formation of these groups and their continued stakeholder involvement satisfy the intent of our recommendation that the CFO work collaboratively with the directors of HUD's components and that the CFO obtain stakeholder involvement.
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| Department of Housing and Urban Development | To help ensure the success of future systems implementation efforts, the Secretary of the Department of Housing and Urban Development should make the modernization and integration of the department's financial management systems a continuing top priority and direct the Chief Financial Officer to develop and maintain milestones. |
Closed – Implemented
HUD's is a multi-year, multi-phase project scheduled to be completed in FY 2013. HUD established and maintains documentation related to the Integrated Financial Management Improvement Project (HIFMIP)project that focuses on project milestones. HUD's HIFMIP Roadmap contains a description of significant events and milestones extending through the project's completion. HUD's Financial Management Segment Architecture also includes the key milestones for the project. The most detailed milestones are submitted to OMB in Exhibit 300: Capital Asset Plan and Business Case Summary. Any slippage from the original and revised baseline milestone dates are currently reflected in this document.
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| Department of Housing and Urban Development | To help ensure the success of future systems implementation efforts, the Secretary of the Department of Housing and Urban Development should make the modernization and integration of the department's financial management systems a continuing top priority and direct the Chief Financial Officer to establish measurable performance indicators. |
Closed – Implemented
HUD has established measurable performance indicators by fiscal year which are linked to HUD's strategic goals. These performance measures are reported on quarterly and are directly related to outcomes that have or will result from the implementation of HUD's Integrated Financial Management Improvement Project (HIFMIP). Such outcomes include reducing the number of legacy systems and enabling HUD to meet E-government and President Management Agenda goals such as reducing material weaknesses and reportable conditions attributable to its financial systems. HUD is also monitoring monthly the implementation of HIFMIP using Earned Value Management (EVM) used to measure schedule and/or cost variances.
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Financial management systemsFinancial statement auditsInternal controlsProgram managementFinancial managementGovernment National Mortgage AssociationFinancial systemsFinancial statementsAccounting systemsHousing