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Improving Financial Management

ADOPT GOOD BUSINESS PRACTICES

INTRODUCTION

A well-run organization might be described as cost-conscious, professionally managed, efficiently operated, financially sound, streamlined, and accountable. Those words are not typically used when the entity being described is the federal government. They would, however, be used in describing successful businesses. A private sector business, subject to the rigors of the market, pays immediate consequences for poor management. An unprofitable business loses its ability to borrow or raise capital; ultimately, it may have to file for bankruptcy. In the federal government, bad management is exposed to no market discipline. It is hidden by committee, undiscovered, or even rewarded. Historically, the government has been able to avoid accountability for its management of taxpayer assets. Those days are gone. In this environment of scarce financial resources, taxpayers are justly demanding that the government use its resources prudently. Every dollar that is wasted is a dollar taken out of a taxpayer's wallet, or lost from a program that would help build a better future.

The government need not reinvent any wheels when it comes to improving its operations. Private sector professionals have designed accounting systems, management reports, financial analysis and planning techniques, service delivery systems, and other tools to make their operations run smoothly and efficiently. The federal government simply needs to adopt the same commitment to improved practices and operations that drives businesses every day. It needs to be run in a more businesslike manner. The recommendations in this section are intended to improve the manner in which the government conducts its business.

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