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U.S. Department of State

Diplomacy in Action

Financial Management Plans and Reports


Bureau of Resource Management
Report
December 16, 2009

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Overview

Introduction

Department of State’s financial activities operate in approximately 260 locations in 172 countries. We conduct business transactions in over 150 currencies and even more languages and cultures. Hundreds of financial and management professionals around the globe allocate, disburse and account for billions of dollars in annual appropriations, revenues and assets. Among the Department’s customers are more than 40 U.S. Government agencies in every corner of the world, served twenty-four hours a day, seven days a week.

The Bureau of Resource Management (RM), headed by the Assistant Secretary for Resource Management, is the Department’s corporate financial manager and strategic planner. RM has overall responsibility for the preparation and execution of the budget; management of financial systems, reporting and internal controls; management of global financial operations and services; and directing the Department’s strategic planning and performance reporting efforts; administering interagency administrative support cost sharing related to overseas missions and interagency resource planning efforts with the intelligence community. RM produces a number of essential documents including the Joint State/USAID Strategic Plan, Department Performance Plan, Agency Financial Report, Performance Report, Citizen’s Report, Budget-in-Brief, and the Congressional Budget Justification Document.

RM employs over 500 people around the globe, primarily in Washington, Charleston, South Carolina and Bangkok, Thailand. RM’s services to its customers are critical to carry out the Department’s mission effectively.

The RM management team and staff have a proven record of outstanding achievement as evidenced by (but not limited to):

  • Successful resourcing of all Secretarial-level priorities while simultaneously resolving a huge funding shortfall for current services;
  • Successful implementation of a new financial management system;
  • Successful implementation of a grading system to measure transparency and quality of budget requests for all interagency activities at post (ICASS);
  • Creation of a Global Partnership Center focused on finding and developing areas where the public and private sectors have a mutual interest in order to maximize program funding potential;
  • Growth in requests for and use of the Post Support Unit as a centralized financial processing unit for overburdened post financial management staff;
  • Implementation of a Quality Management System under ISO 9001 standards for core financial operations.
MISSION

To integrate strategic and performance planning, budgeting,and performance, and to secure the resources necessary to accomplish the Department of State’s mission.

The RM mission statement is incorporated into the Department’s strategic goal for Strengthening Consular and Management Capabilities. The RM Assistant Secretary also serves as the Department’s Chief Financial Officer. Pursuant to the CFO Act of 1990, this designation makes the Assistant Secretary responsible for all financial management activities related to Department programs and operations. This overview relates to the CFO role and financial management responsibilities set forth under the CFO Act.

BUREAU OF RESOURCE MANAGEMENT GOAL STATEMENT

To establish world financial services, integrate budget, planning and performance, and ensure that all RM employees know they play a crucial role in the success of American foreign policy.

Performance measures for this goal include timely financial reporting, elimination of material weaknesses in internal control, the achievement of unqualified (“clean”) audit opinions, elimination of improper payments, and implementing financial systems and processes that meet Federal requirements. In addition to these, RM endeavors to consolidate and standardize financial operations, leverage best business practices and electronic technologies, and build a first-rate finance team.

FY 2009 Results

Providing World Class Customer Service.

Central to our vision of a premier, global financial system is the worldwide cadre of financial managers who rely on our financial systems to conduct the Department’s business and support bureau missions. It is critical our systems meet the needs of this diverse customer base. Product review groups have been instituted to better enable us to work with our customer base, identifying priorities for improvements to systems, associated business processes, and support mechanisms.

Implementing Financial Systems and Processes that Meet Federal Requirements.

In FY 2008, we stabilized the Global Financial Management System after its major conversion in FY 2007. In September 2008, GFMS statistics across all interfaces established as baseline a 97% acceptance rate on 5.4 million transactions. As of August 2009, acceptance rate is 98% of 5.0 million transactions. Over the past year, 40 major software releases were implemented addressing over 1,000 software changes and enhancements across the Department’s suite of financial systems. These changes and enhancements covered a wide array of systems including compensation, reporting and management information, and accounting and logistics. FY 2009 has also brought a new auditor to conduct the financial statement audit. It became clear early on that there is an increased emphasis on compliance with applicable Federal requirements and regulations – e.g., the Federal Information System Controls Audit Manual (FISCAM), the National Institute of Standards and Technology (NIST), the Financial Systems Integration Office (FSIO) – that will greatly influence our system priorities in FY 2010.

Leveraging Best Business Practices and E Government.

The deployment of e Travel worldwide continued unabated in FY 2009. Global e Travel, utilizing a web-based commercially available off-the-shelf system (COTS) solution is now in place at 80 missions overseas and 34 bureaus domestically. Overseas, we exceeded our goal of 66% of overseas travel vouchers being processed through the new system by implementing Global e Travel at those posts that generate 70% of overseas temporary duty travel vouchers.

The interface of our Regional Financial Management System with Global e Travel, implemented in early FY 2009, has an acceptance rate exceeding 98%.

The Department’s effort of migrating to a Grant Management Line of Business solution continued throughout FY 2009. With the selection of GrantSolutions offered by the Department of Health and Human Services in FY 2008, the Department implemented its first pilot under our State Assistance Management System in January 2009 for the Global Monitoring and Combating Trafficking in Persons organization. GrantSolutions will automate the full range of assistance management activities, from solicitation through award, post-award monitoring and closeout. Requirements for the interface between Management System and GFMS were finalized in September 2009. Design of an interface between GrantSolutions and GFMS is in progress with an anticipated completion in 2010.

The Department selected a COTS solution for its payroll. The Global Foreign Affairs Compensation System will utilize this new payroll COTS platform to replace six legacy systems with a single system supporting the widely diverse global payroll requirements for the Department and the forty plus agencies it services. Payees will include locally engaged, civil service, and Foreign Service staff, as well as Foreign Service Annuitants.

Looking Forward.

RM will continue to work to ensure fundamental financial management “compliance” results – on time, accurate financial statements that achieve an unqualified (“clean”) audit opinion, financial systems and processes that meet Federal requirements, and effective internal controls.

OMB continues its initiative to standardize government-wide business processes to address the Federal government’s long-term need to improve financial management and assist agencies in substantially complying with the Federal Financial Management Improvement Act (FFMIA). Also, over the next several years, a number of new Federal accounting and information technology standards will become effective. These include government-wide projects to standardize business requirements and processes, establish and implement a government-wide accounting classification, and support the replacement of financial statement and budgetary reporting to the Department of the Treasury. The Department’s implementation of new standards and government-wide reporting will strengthen both our financial and information technology management practices.

In FY 2010, RM will continue to expand its centralized processing services to support additional posts and wholesale systematic consolidation of some financial processes. For Global eTravel, we will complete full deployment domestically and anticipate reaching the goal of 90% of overseas temporary duty travel voucher volume being supported, network connections permitting. Next year will also bring focus on greater consolidation of financial and other administrative systems into RM’s existing portfolio of systems, incorporating each into a disciplined and certified system development and maintenance organization.

With the selection of the Payroll COTS solution, work has begun in earnest to implement the Global Foreign Affairs Compensation System. FY 2010 will be focused on implementing components to generate annuitant payments to the Department’s retired Foreign Service Officers and their qualified beneficiaries and migrating the Department’s Foreign Service National payroll to the new platform.

RM will also undertake activities that support effective strategic decision-making and mission performance. These activities include strengthening the Department’s financial management analytic capabilities. RM will work to expand its analytical capability to provide the Department’s senior management with timely and thorough financial/cost analysis to support funding decisions. At a time when the USG is facing a potential $1 trillion deficit, the Department will undoubtedly be faced with some difficult choices over critical but competing priorities. Having the CFO establish or independently verify the fully loaded costs of programs or initiatives, with affordable cost alternatives and expected results, will be essential in maximizing the effectiveness of the Department’s funding. This ability to better quantify costs with results will also bolster the Department’s credibility with Congress and OMB.

Financial Management Systems

Through the Joint Financial Management System Program, the Department is integrating its overseas and domestic financial operations onto a common, global financial management software platform in Charleston, S.C. This is dramatically improving operations and reducing costs by eliminating system redundancies and replacing obsolete and unsupported financial systems. It is also providing the infrastructure for integrating other administrative activities within the Department, such as the Integrated Logistics Management System, Global eTravel, State Assistance Management System, and other domestic and post-level systems.

The diagram below depicts the state of our vision, a virtual global financial management system.

Diagram depicting the Global Financial Management System (GFMS) vision and concept.D

The common platform underlying the Department’s global financial management solution is CGI-Federal’s Momentum™ financial management system. Momentum is a certified federal financial system used widely in the federal market place. This solution uses the same software and technical platform to support the Global Financial Management System domestically, the Regional Financial Management System overseas, and USAID’s Phoenix financial management system. Together with our efforts on Global Direct Connect, this enables a single integrated view of financial data through data standardization, common business processes, and the seamless exchange of information through the Department’s financial and administrative sectors. The GFMS, RFMS and Global Direct Connect components of State’s solution are further described below.

Global Financial Management System.

In FY 2007, the Department implemented the GFMS as the next step in its multi-year effort to establish a global financial system. With the implementation of GFMS, we aligned our domestic financial management systems environment with the Department’s enterprise architecture. The system centrally accounts for billions of dollars through over 5 million annual transactions by 1,000+ users and over 25 “handshakes” with other internal and external systems. It includes data warehouse, fixed asset and cost allocation (for managerial cost accounting) modules and integrates the Department’s acquisition and fixed asset systems into a single software application.

Regional Financial Management System.

RFMS is the global accounting and disbursing system that has been implemented for posts around the world. RFMS includes a common accounting system for funds management, obligation and voucher processing; the RFMS/D system to provide disbursing services; and the Consolidated Overseas Accountability Support Toolbox (COAST) post-based system for analysis, reporting and other post-level activities. The system incorporates State’s standard account structure and improves transaction standardization and timeliness between post and headquarters, which results in the consistent, timely processing and recording of financial data on a worldwide basis. Plans for FY 2010 include further improvements to the COAST offering, with continued rollout of a much improved encryption capability and initial deployment of cashiering capabilities.

Global Direct Connect.

Our Global Direct Connect initiative moves posts that have operationally practical and reliable network connections from their batch processing environment to a real time, on-line connection. As a result of our efforts to date, there are now over 145 (out of a possible 180) posts using Global Direct Connect. In FY 2009, we converted 14 posts to Global Direct Connect. Moving forward, our plan is to convert another 26 posts to Global Direct Connect in FY 2010 and then to convert the remaining 9 posts in FY 2011.

Financial Management Information to Improve Decision Making.

With the consolidation and streamlining of our worldwide financial systems operations, the ability to capture and maintain accurate, meaningful financial information, and provide it to decision makers in a timely fashion, has vastly improved.

To support overseas financial management officers and post decision makers, RM implemented COAST reporting in FY 2007. In FY 2008, improvements were added to provide information “drill down” and budget and planning versus actual reporting capabilities. RM continues to enhance Its COAST reporting tool, which provides daily updates on all financial transactions to 168 posts overseas and domestic bureaus, allowing them to analyze, and “slice and dice” their financial data for local reporting purposes using modern reporting and query tools on their local workstation.

Domestically, and in support of Department-wide reporting, RM implemented the GFMS Data Warehouse in FY 2007. Based on a modern, browser-based technology platform, the GFMS Data Warehouse enables users to access financial information from standard, prepared reports or customize queries and reports in real time to compile the financial information needed for informed decision making on a day-to-day basis. The GFMS Data Warehouse also provides, on a daily basis, critical financial information to the Department’s Enterprise Data Warehouse. In addition to adding and improving reports and queries, managerial cost accounting and acquisitions reporting modules have been added to the GFMS Data Warehouse since its inception. Plans for FY 2010 include expanding available content and further enhancing management reporting capabilities, including executive-level dashboard reporting.

Photo showing the American Embassy in the Schoenborn Palace in Prague.

Secretary’s List of Culturally Significant Properties:

The American Embassy in the Schoenborn Palace in Prague has a long and complex history of adaptations to accommodate a wide range of royal, noble and governmental owners. The United States purchased the property in 1924 for use as an American Legation. Five medieval residences and a malthouse were combined together in the early decades of the seventeenth century to create the original palace, apartments and garden. Department of State/OBO

 




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