OMB UPDATE FY 2007 Priorities

1. OMB UPDATEFY 2007 Priorities Danny Werfel Deputy Controller Office of Federal Financial Management Office of Management and Budget May 8, 2007

2. “Much as we love the President, if Congress, in its omnipotence over appropriations, passed a law that garbage should be put on the White House steps, it would be our regrettable duty, as a bureau, in an impartial, non-political and nonpartisan way, to advise the Executive and Congress on how the largest amount of garbage could be spread in the most inexpensive and economical manner.” Charles Dawes The First Budget Director

3. “For I detest this life ... as one who must be used to upset the status quo, I am not the logical man to continue the operation of the Budget Bureau.” Charles Dawes (on leaving his post as Budget Director)

4. Improving Financial Performance Results Expands Routine Data Use Uses Financial Information to Drive Results in Key Areas FFMIA Compliant Clean Audit Opinion No repeat auditor Weaknesses Meets Reporting Deadlines Compliance No Repeat FMFIA Section 2 Weaknesses No Material Non-Compliances No Chronic or Significant ADA Violations No Repeat FMFIA Section 4 Weaknesses What the Initiative Does: Ensures managers have accurate and timely financial information for decision making.

5. PMA Financial-Related Outcome Measures, Results, & Performance Targets

6. Improving Financial Performance How We Support the Initiative: PMA REFORM AGENDA CORE ACTIVITIES

7. The Framework

8. Eliminating Improper Payments • Strategic Goal • Reduce the government-wide improper payment dollar amount and rate • Interim Objectives • Measurement for all programs • Root causes and corrective actions • FY 2007 Priority Actions • Measurement plans in place for FY 2008 • State partnership project to enhance program integrity efforts • Expand recovery auditing to ensure full participation for all mandated agencies Improper Payments

9. Right-sizing Real Property • Strategic Goal • Right-size the Federal Real Property Inventory • Interim Objectives • Inventory /performance metrics/asset management plans • Dispose of unneeded Federal real property FY 2007 Priority Actions • Enact the President’s legislative reform proposal • Facilitate inter- and intra-agency coordination on real property • Ensure agencies use performance data in their decision-making process Real Property

10. Strategic Goal • Receive a “clean” audit opinion on the Report’s financial statements • Interim Objectives • Downgrade intra-governmental transactions MWs • Achieve an opinion on the Department of Defense’s balance sheet • Improvements in Agency-Treasury reporting FY 2007 Priority Actions • Intra-governmental transactions • Implement Dispute Resolution Committee • Develop performance metric, • Initiate IPAC system improvements U.S. Financial Report Improving the U.S. Financial Report

11. Strategic Goal • Implement government-wide solutions that yield lower cost and risk results in financial management activities • Interim Objectives • Transparency: Migration planning guidance & common performance metrics. • Standardization: Common accounting code & standard business processes • FY 2007 Priority Actions • Finalize common accounting code • Define additional standard business processes • Finalize information technology measures and pilot collection • Address FMLoB policy questions • Define standard interfaces to core financial systems FMLoB The Financial Management Line of Business (FMLoB)

12. Strengthening Internal Controls • Strategic Goal • Improve effectiveness of internal control over financial reporting • Interim Objectives • Use A-123 assessment results to improve MW corrective action plans • Obtain consensus between management, OIG, and OMB on MW corrective action plans • Enhance internal control based on lessons learned and best practices FY 2007 Priority Actions • Lessons learned forums • Update OMB guidance • Require agencies to update corrective action plans Internal Controls

13. Strengthening Grants Management • Strategic Goals • Increase transparency in grant activities • Lower administrative costs • Simplify application and reporting • Interim Objectives • Make some award data available on a searchable public website • Begin migrating major grant-making agencies to the GMLOB consortia • Complete required activities under P.L. 106-107, Grants Streamlining FY 2007 Priority Actions • Complete action items for FFATA implementation • Complete P.L. 106-107 activities Grants

14. Strengthening Social Insurance Reporting • Strategic Goal • Disclosure of comprehensive social insurance (SI) and sustainability data Interim Objectives • Receive a “clean” opinion on the FR Statement of Social Insurance (SOSI) • Develop a “Statement of Fiscal Sustainability” and include it as a principal statement within the FR FY07 Priorities • Solicit comments on the FASAB SI Preliminary Views document • Launch FASAB Sustainability Task Force Social Insurance

15. Bringing the framework together…

16. Questions???