Green goes beyond accounting
- By David Perera
- Mar 10, 2005
It takes more than good accounting to earn a green score in the financial performance category of the President’s Management Agenda quarterly score card, an OMB official said today.
The financial performance initiative “is about making sure that managers are using financial data to make better decisions,” said Danny Werfel, chief of the financial integrity and analysis branch within the Office of Management and Budget’s Office of Federal Financial Management.
On the traffic light-coded score cards, yellow scores are given to agencies demonstrating mere compliance with financial regulations, such as the Federal Financial Management Improvement Act, Werfel said, speaking today at the annual Joint Financial Management Improvement Program in Washington, D.C.
A green score means agency officials have identified critical business questions, cost drivers and risk areas, and are using financial data as an informer of their strategic choices, he said.
“If your agency has purchased a $400 hammer, you’re at yellow if that transaction was recorded appropriately,” Werfel said. Agencies with green scores don’t make such purchases because timely dissemination of financial data allows officials to prevent them from happening, he said.
Using the scores to measure success is also important, he added. “Without them, I’m not sure how you know where you’re going and how you’re getting there.”
Getting to green requires agency chief financial officers to stop thinking of themselves primarily as accountants, said Susan Grant, Energy Department CFO. “We really need to think about ourselves as being chief management officers,” she said. The department is one of only eight agencies with a green score for financial management.
Business managers need financial information pushed to them “before they need it, not after they’ve already done it,” Grant said.
She cited the department’s Integrated Management Navigation System (I-MANAGE) as an example. The ongoing program integrates accounting, procurement, human resource, travel and content management systems. Since January, DOE financial analysts and managers have been able access top-level financial information on computer desktops via I-MANAGE software.
The user interface allows managers to request financial information alerts when certain data enters a danger zone, Grant said.
In general, the financial community needs to adopt a service-oriented culture, she added. “Financial data are consequences of business transactions," Grant said. "We’ve got to get out of the business of thinking that this is our data.”
In the past, it was enough for CFOs to know how to handle balance sheets, she said. “Not anymore, you’d better know your customer’s business.”
A lack of OMB guidance should be no reason for CFOs to hold back, she said. “I don’t want OMB guidance on any of it, I would much rather set my own course.”
“Let me take it over to them and show them what I can do," Grant said. "That’s what they want – they’re not the smartest people in the world. They’re people just like us.”
David Perera is a special contributor to Defense Systems.