Changes coming to federal financial management

The Financial Systems Integration Office, the federal office that manages the Financial Management Line of Business, will stop testing and certifying federal financial systems on March 31.

In a letter posted to the Office of Management and Budget website March 16, OMB controller Danny Werfel said OMB will "develop the new path for financial systems in the Federal government."

With a planned March 31 update to core financial systems requirements, "we believe that FSIO has finished developing FMLoB business process and data standards as it related to its mission," Werfel wrote. "In response to these challenges, we have reassessed the need for the core financial systems testing and product certification program and will be discontinuing this function," he added.

The FMLoB has been an effort to consolidate financial systems within the government, with four federal agencies and private sector organizations acting as centralized service centers to other agencies.

For example, the Interior Department's National Business Center hosts financial systems and business operations for external executive branch organizations, and a few legislative branch organizations.

Rapid advances in technology require a rethink of how the government implements financial systems, Werfel said. "Once deployed, our financial systems are also not meeting agency programmatic needs or producing the right information to support decision making," Werfel said.

OMB will announce on Monday a plan for replacing the current shared service approach, according to a private sector executive with knowledge of government deliberations. It likely will include cloud computing, the executive said.

"If it's a government-wide enterprise shared service, which people would call a private cloud, then agencies can't customize. It's the Obama administration version of shared services," the executive said.

Financial management systems are notoriously difficult to implement in the federal government, in part because agencies greatly customize commercial systems.

"A lot of agencies don't want to change the way they do business, they'd rather change the code," the executive said.

For more:
- check out OMB Controller Danny Werfel's letter (.pdf)

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