FMS readies its upgrade program

The Financial Management Service has launched a six-year effort to revamp how it collects accounting data from federal agencies and to modernize its systems so that it can produce government financial reports more efficiently.

FMS would not begin updating or building any systems until 2001 at the earliest, said Larry Stout, assistant commissioner for governmentwide accounting, but the agency has asked for $400,000 to conduct preliminary design work next year and is preparing to hire a consultant to assist with the project. Stout said no decisions will be made about which systems to update or how to go about updating them until the agency figures out its data requirements.

It is not clear whether the accounting systems of other federal agencies that provide data to FMS would be affected by future changes. "The hope is that whatever we end up doing will make life easier for them," said Connie Craig, FMS' chief information officer.

"This is less of a technology issue than a business process issue," said Harry Barschdorf, who tracks government accounting practices as vice president of American Management Systems Inc.'s civilian agencies consulting and systems practice. "It's fundamentally about defining an optimal process for this routine data collection.''

FMS is the government's central accountant. It writes most federal checks and reports how much agencies have collected and spent. FMS uses five systems to collect and analyze the data for these reports.

In its most recently published information technology investment plan, FMS said modernizing one of those systems, the Central Accounting System, known as Star, would help the agency take advantage of newly established federal accounting standards and the capabilities offered by the latest financial systems that other agencies are installing. Mainframe-based Star, which tracks the government's overall cash flow, is nearly a decade old, and the business processes that feed it date to the 1950s.

Four other FMS accounting systems recently have been or are being upgraded.

Al Muhlbauer, the National Science Foundation's deputy chief financial officer and part of an interagency focus group that FMS convened in late March to advise it on how to proceed, said there is an opportunity to simplify the reports agencies have to make to FMS. But he said new data needs might result in new requirements. For example, FMS does not have a reliable method for collecting data on about $250 billion in interagency transactions, a deficiency that prevented the government from getting a clean audit opinion from the General Accounting Office last month.