Improving Financial Management

NPR Recommendations

FM01 Accelerate the Issuance of Federal Accounting Standards
FM02 Clarify and Strengthen the Financial Management Roles of OMB and Treasury
FM03 Fully Integrate Budget, Financial, and Program Information
FM04Increase the Use of Technology to Streamline Financial Services
FM05 Use the Chief Financial Officers (CFO) Act to Improve Financial Services
FM06 "Franchise" Internal Services
FM07 Create Innovation Funds
FM08Reduce Financial Regulations and Requirements
FM09 Simplify the Financial Reporting Process
FM10 Provide an Annual Financial Report to the Public
FM11Strengthen Debt Collection Programs
FM12 Manage Fixed Asset Investments for the Long Term
FM13Charge Agencies for the Full Cost of Employee Benefits

Progress to Date

In June 1996, the first set of accounting standards was issued for the federal government, and a financial systems framework was established.

Through the Chief Financial Officers Council, financial managers and oversight organizations have developed a uniform vision, a set of priorities, and a program plan. FinanceNet, an Internet-based forum operated by the National Science Foundation, has been institutionalized by the CFO Council and the Joint Financial Management Improvement Program as a mechanism for professional interchange for improving financial services. The network's usefulness has been recognized across the federal government, by state and local organizations, and by other nations as well.

Five pilot franchise funds authorized by the Government Management Reform Act of 1994 (Public Law 103-356) have been approved for operation and are under way. Also, as authorized by the act, OMB is working with agencies to develop a single annual planning report each fall and a single accountability report each spring to replace the myriad financial reports currently required throughout the year. This approach is designed to ease agencies' reporting burden and provide information to decisionmakers rather than just data. These pilots are under way in six agencies.

A comprehensive debt collection management initiative was passed by Congress and signed by the President in April 1996 (Public Law 104-134). This will allow agencies to finance their debt collection activities with the revenues generated from their collection efforts. In addition, it will let agencies keep up to 5 percent of any increased collections of delinquent debt. The legislation authorizes the Department of the Treasury to offset payments to individuals and entities that are seriously delinquent in their debts to the federal government; it also authorizes an electronic screening process that will track borrowers governmentwide to bar seriously delinquent debtors from receiving additional credit.

The Administration also submitted legislation to Congress to charge agencies for the full cost of employee benefits. Currently, OPM shares part of these costs, thereby indirectly subsidizing agency operating costs.

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