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Financial Management Service (FMS) Quarterly Intelligence Forum Presentation

May 29, 2009

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Agenda

Overview of Accounting Standardization & Budget Management Line of Business - Holden Hogue

Overview of Data Harmonization – Marcel Jemio

CGAC / FMLoB – Reimbursables – Robin Gilliam

FIRST/GTAS - Jeff Hoge

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Strengthening Accountability and Integrity in Accounting and Reporting

• Two lines of business:

Financial Management and Budget Formulation and Execution (Budget Execution and FM Integration)

• FMS Data Management and standardization

• FMS Data Governance

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Standardizing Budget Business Processes

Budget Execution and Financial Management Line of Business (BEFMLoB)

Identified core budget execution process maps https://max.omb.gov/community/x/EgAFAw

Utilized DOD BTA USSGL SFIS Transaction Library for government-wide use

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BEFMLoB

Deficiencies:

• No single source of data

• Multiple data exchanges between multiple partners

• Multiple schemas based on data being exchanged

• Data not available electronically

Agencies

Treasury OMB

Financial and Budgetary ReportingData Exchange Current Structure

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Financial and Budgetary Data ExchangeConcept Model: Data Exchange Proposed Structure

Benefits:

• Provides a single source for budgetary and financial data

• Reduces required number of exchanges

• Standard data exchange schema

• Makes data available electronically

Data ExchangeConcept Model

OMB

Agencies

Treasury

BEFMLoB (cont.)

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Enterprise Data Architecture (EDA) ActivitiesEnterprise Data Architecture (EDA) Activities

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EDA Activities EDA Activities (cont)(cont)

FMS Financial Management Data RegistryFMS Financial Management Data Registry

Implemented in 2008 Provides an Inventory of Financial Management Data Documents Data Standards for: Name, Format, Length,

Business Definition, Business Owner, etc. (ISO 11179 metadata) http://fms.treas.gov/eda

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EDA Activities EDA Activities (cont)(cont)

Data modelData model Reflect harmonized data models in XML/UML (eg. Treasury

Account Symbol class)

Self-describing web site – mind maps, mapping templates, relational browser

http://fms.treas.gov/eda/xml

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Implementing CGAC and FMLoB at FMSCommon Government-wide Accounting Classification Structure

Financial Management Line of Business

May 29, 2009

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What is CGAC and How does it impact FMS?

CGAC is the Common Governmentwide

Accounting Classification Structure with

60+ data elements: Version 1.0 was published in July 2007 Version 2.0 to be published by end of 2009 www.fsio.gov

FMS is concerned with the data elements that are

collected for: Fund Balance With Treasury transactions and reporting (TAS/BETC)

http://fms.treas.gov/gwa/factsheet_tas.html the USSGL accounts attributes associated with quarterly and year-end

financial reporting

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Implementing CGAC at FMS

TAS

Bureau Code

USSGL Attributes

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Overview of CGAC TAS Components

Component Acronym/Field

Length

Definition

http://fms.treas.gov/gwa/factsheet_tas.html

1. Sub-level Prefix Code

SP/2 A programmatic breakdown of the account for Treasury publication purposes

2. Allocation Transfer Agency Identifier

ATA/3 The Agency Identifier of the agency receiving funds through an allocation transfer

3. Agency Identifier AID/3 Represents the department, agency or establishment of the U.S. Government that is responsible for the TAS. Used in conjunction with the main account code

4. Beginning Period of Availability

BPOA/4 In annual and multi-year funds, identifies the first year of availability under law that an appropriation account may incur new obligations

5. Ending Period of Availability

EPOA/4 In annual and multi-year funds, identifies the last year of funds availability under law that an appropriation account may incur new obligations

6. Availability Type Code

A/1 Identifies no-year accounts “X”, clearing/suspense accounts “F”, Treasury’s central summary general ledger accounts “A”, and merged-surplus accounts “M”.

7. Main Account Code MAIN/4 Identifies the type and purpose of the fund

8. Sub-Account Code SUB/3 Identifies an available receipt or other Treasury-defined subdivision of the

main account

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What FMS needs to do to Implement CGAC TAS

Data Conversion:Updating FMS data base from a 2 digit

Department Regular (DR) code to 3 digit Agency Identifier (AID) code

Technical/structure change to database & Account Maintenance

Change to actual data Change agencies from their 2 digit DR to 3 digit AID

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Implementing CGAC TAS (cont.)

First - FMS needs to inform agencies Sent CFO letter and list of expenditure accounts

informing of how codes will change – June - August 08 Received and incorporated comments

Will send CFO Letter and complete account crosswalk from current TAS to new CGAC TAS and new Standard Bureau Code - August 09 Comments due September 09

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Implementing CGAC TAS (cont.)

Second - FMS needs to Move Agencies to new Department Regular Codes

The following agencies will start to use their new 2 digit Department Regular Code and new Main accounts in support of moving to their 3 digit agency identifier code:

Treasury Managed Trust Funds – April 13, 2009

Legislative: 2010 [possible new main accounts]

International Assistant Programs (IAP): 2010 [possible new main accounts]

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Implementing CGAC TAS (cont.)

Third - FMS will start to transition:

From collecting the current Treasury Account Symbols

To collecting the CGAC TAS for our transaction and reporting systems beginning in 2011

This implementation plan, per each FMS application, is under development

Most of FMS applications will accept & display both current and CGAC TAS, except FIRST – GTAS https://www.fms.treas.gov/gtas

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Implementing the Governmentwide Standard Bureau Code

Working with OMB to align and standardize the Bureau Codes Governmentwide

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Implementing the USSGL CGAC Attributes

Working with FSIO, OMB and the USSGL to finalize the USSGL attributes for the GTAS implementation

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Financial Management Line of Business (FMLoB)Standardizing Financial Management across the Government

Financial Management Lines of Business (FMLoB) FMS working very closely with OMB and FSIO on:

Payment & Funds Management Receivables Reporting Reimbursables (Buy/Sell) Management

Standardize an interagency agreement Develop communication tool for processing reimbursable

activity Help to remove audit finding concerning elimination entries

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Managing Agency

Reimbursable (Buy/Sell) Agreements FMLoB Reimbursables

BuyerSeller

Agreement

Invoice

Key: Initiates Approves

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Reconciling Elimination Entries

DailyReimbursable [Buy/Sell]

Agreements

Trading Partner – Quarterly Reporting and Reconciliation

AnnualDepartment

Financial Report

Beyond FMLoB Reimbursables

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FMS Contact Information

Robin Gilliam, CPA, PMP – CGAC, FMLoB Standardization

robin.gilliam@fms.treas.gov, 202-874-9133

Future Website page [Finanicial Management & Budget Standardization]

on www.fms.treas.gov

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FIRST/GTASFinancial Information & Reporting Standardization

Governmentwide Treasury Account Symbol (TAS) Adjusted Trial Balance (ATB) System

May 29, 2009

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Integrity from Merriam-Webster

Firm adherence to a code of especially moral or artistic values: incorruptibility

An unimpaired condition: soundness The quality or state of being complete or

undivided: completeness

Synonyms, see honesty

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What We Want to Talk About

What is FIRST? Why do we need it? What are the its key concepts? What benefits can we expect and when? What are some of the system characteristics? How do we get ready? My challenge: Can I change your mind?

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What IS FIRST?

USSGLDatabase:

SID

GFRS

USSGL basedReporting: GTAS

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What We Will Collect

FMS will collect quarterly USSGL-based trial balances, similar to FACTS II but expanded to cover proprietary USSGL accounts and all fund symbols.

FMS will edit the inbound trial balances using the central accounting data, Bureau of Public Debt data on investments and borrowings, and rules of the USSGL.

FMS will provide instant and actionable feedback to agencies and their auditors.

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Why do we need FIRST?

• Reporting by agencies to Treasury and OMB is:

• inconsistent• redundant

• It emphasizes reporting rather than accounting

• Results are bad

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Why do we need FIRST?Example of a Bad Result: Net Outlays

Gross disbursements Less: Offsetting Collections Equal: Net Outlays Less: Receipts Equal: Deficit

FY 2008: Net Outlays reported by agencies via monthly 224/1219/1220 differed from SBR outlays by $162 billion government-wide.

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Why do we need FIRST? Conceptual Issues

Our model doesn’t work Primacy of the Financial Report of the U. S. Government Standards for the “One” entity that matters Recognition of the Budget Process Constancy of purpose The clean opinion temptation True transparency

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Why do we need FIRST? More specific reasons

FY 2008 eliminations differences Non-expenditure transfers: $25 billion Buy-sell: $31 billion

The “plug”: $30 billion

Shared responsibility, in case you think it’s just an FMS problem

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Why we need FIRST3 Types of Inconsistency

1. Inconsistent data in Agency Statements vs. the Financial Report of the U. S. Government. (GFRS addresses this type)

2. Inconsistent data in agency financial statements vs. agency monthly reporting to Treasury and Warrant and NET transactions (Not addressed)

3. Agency financial statement data not consistent with USSGL. (Not addressed)

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Current Situation:FMS makes $1 trillion worth of JVs for the FR each fall. Where will the next problem pop out?

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FIRST-Key Concepts The Financial Report of the U. S. Government has primacy over

component financial statements.

Preparation of financial statements is an accounting function, not a political one. We must use accounting principles. We will support the Financial Report of the U. S. government with trial balances.

The USSGL is the common accounting language we all speak or should speak. Therefore, the collection of USSGL-based trial balances will be the key to our future success.

We will replace FACTS I, FACTS II, IFCS and the input part of IRAS, reducing the number of agency reports and standardizing them.

We will validate and edit every incoming trial balance using every tool available (USSGL rules, central accounting system, BPD data, etc) and provide instant feedback.

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Business as System

GWA Internal Processes

Inputs

Agency Statements

FASAB, TFM, etc

Customers

President, CongressCitizens

Outputs

FR

A-136

USSGL-based trial balances Detailed edit reports

Feedback

Accurate datasuitable forAnalysis.Predictivecapability

Today, the stuff coming in from the left is bad. We need to help fix it.Agencies supply components that don’t fit the completed machine.

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Future Look

USSGLDatabase:

SID

GFRS

USSGL basedReporting: GTAS

GWAMP/USSGL

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Trial Balance Example

1010 d 700 < 4119 d 1000 < 1750 d 300 4170 c 100 < 1759 c 15 4610 c 400 2110 c 300 4901 c 300 3101 c 1000 < 4902 c 200 3103 d 100 < 3107 d 500 5700 c 500 6100 d 200 6710 d 15 8801 c 300 8802 d 300

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Information Sharing—FIRST Steps

GWA Account Statement

UCAD

FACTS II Edit report

GWA’s Business Process Group

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Expected Results

USSGL Compliance Reduced elimination differences More consistent reporting from each agency that

FMS can read, interpret, and consolidate Elimination of obvious and embarrassing

discrepancies Better information for decision-making Eventually, a predictive capability

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System Characteristics

• Supermaf with TAS attributes• A trial balance for every Treasury Account Symbol• Expenditure accounts like FACTS II, plus receipt accounts, deposit funds, clearing accounts (12,000 per quarter)• Beginning and ending balances plus all USSGL attributes• Bulk files only• CGAC format• Instant and usable feedback

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System Characteristics (cont)

Ready for testing summer 2011 Open for practice all the time after that Agencies must successfully transmit bulk files Ready for production first quarter FY 2012

(January 2012)

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Improved FR Data Edits

Agency Accounting

Systems

Financial Report of the U. S.

GovernmentAgency Financial

Statements

Feedback loop

USSGLDatabase

GFRS

USSGL basedReporting

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New Process

FMS OMB

President’s Budget

Standard General Ledger

FIRST

FMS 2108 SF 133 Program and FinancingSchedule

Federal Agency

Treasury Annual Reporting

Central Accounting

System Edits

GFRS

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Government-wide Benefits Takes advantage of GWAMP

Streamline reporting requirements on agencies

Focus on accounting, not reporting

Improved quality of financial information

Ease of use of the USSGL for agencies

Logical, long range approach that attacks core problems (i.e., intra-gov eliminations & budgetary vs. proprietary data consistency)

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Getting Ready

Try to send consistent data to FMS. This will force

you to communicate within your agency.

Use the FACTS II bulk, and generate FACTS II trial balances from your system.

Become USSGL compliant. Stop posing and commit!!!

Begin using UCAD and Account Statement

Attend FIRST forums and/or training class

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Information

FIRST•GTAS -- http://www.fms.treas.gov/gtas•USSGL -- http://www.fms.treas.gov/ussgl•GWA – https://www.gwa.gov

•Jeff Hoge -(202) 874-6179 jeffrey.hoge@fms.treas.gov