#1 - Who Said This?

1. #1 - Who Said This? To be a leading democracy in the information age may very well mean producing unique public sources of objective, independent, scientifically grounded, and widely shared quality information so that we know where the United States stands now and what the trends are on both an absolute and relative bases—including comparisons with other nations. By ensuring that the best facts are made more accessible and usable by the many different members of our society, we increase the probability of well-framed problems, good decisions, and effective solutions. The stakes are high, including considerations regarding allocating scarce public resources, strengthening the economy, creating jobs, stimulating future industries, enhancing security, promoting safety, strengthening our competitive edge, and sustaining the environment.

2. XBRL International Conference “XBRL for US Federal Government Accountants ” Don Geiger don.geiger@do.treas.gov INRPT08: Wednesday December 6, 200611:00 – 11:45Philadelphia, PA

3. 3 Takeaways from Today’s Session • #1 - discuss the advantages of XBRL taxonomies as the basis in Federal Financial Reporting for normalization, verification, and transparency of federal financial statements. • #2 - explore the work completed to date on taxonomies for USSGL Federal Financial Reporting and discuss future plans, seek input and participation • #3 – discuss next steps for FSIO (old JFMIP) Oracle, SAP, PeopleSoft, CGI/AMS, Savantage---- PILOT Test Also IDEA AND ACL

4. My involvement in XBRL • Strayer University, Academic Member XBRL.ORG Adjunct Professor Governmental Accounting & AIS • Leader Governmental XBRL CoP • Involved XBRL US Inc.- Public Sector WG • US Treasury, DCFO, Financial Systems Integration Office (Treasury Departmental, not GWA)

5. Google – Governmental XBRL CoP

6. My Public Sector Focus • XBRL in Federal Financial Statements • Financial Statements, Financial Transactions, Financial Rules • The encompasses two area in XBRL • FR Financial Reporting • Statements, footnotes, MDA, FR repository, rules • GL Global Ledger • Transactions, trial balance, core financial system, rules

7. My Sessions here at Convention • Internal Reporting GL – Global Ledger • Wednesday 11:00 – 11:45 • Regulatory Reporting FR – Financial Reporting • Wednesday 2:00 – 2:30

8. 2nd - U.S. Government Agency - Financial Statements - TAGGED with XBRL

11. 3nd - U.S. Government Agency - Financial Statements - TAGGED with XBRL

12. #9 - Who Said This? • “Let me put that another way: Thanks to the efforts of George Washington, Thomas Jefferson, James Madison, and other full-time patriots and part-time politicians in Philadelphia 219 years ago, along with the later enactment of the Bill of Rights, you and I can meet here today, exchange ideas, and voice our opinions with no real threat of government interference or retribution. Freedom of assembly and freedom of expression are just two of the rights spelled out in the First Amendment to the Constitution. Sadly, these basic rights, which are so easy to take for granted, still aren’t guaranteed in many parts of the world.”

13. The Federal Financial Reporting Supply Chain FACTS I FACTS II Budgetary Transactions Accounting Transactions Internal Financial Reporting External Financial Reporting Processes XBRL-GL XBRL-GL XBRL-FR Agencies, Bureaus, Reporting Components, CFO Act Departments & Independent Agencies Aggregators FMS OMB & Governmentwide Aggregators Citizens Participants Trading Partners Inspector General GAO & Auditors OMB Examiners & Appropriators XBRL GL FSIO Certified COTS – Core Financial System Software Vendors Accountants monitoring Financial Transactions Accountants monitoring Internal Controls Budgeteers doing Budget Formulation Budgeteers doing Budget Execution

14. FASAB Standards Treasury USSGL Audit Report & Guidance OMB A-136 Sources of Information for Federal Financial Statements (as is now) ----------------------GovernmentAgencies--------------------------- USDA DOC DOD ED DOE HHS HUD DHS DOI DOJ DOL DOS DOT TREAS VA USAID EPA GSA NASA NSF NRC OPM SBA SSA

15. Why XBRL GL - Global Ledger - will improve efficiency in Federal Accounting • XBRL-GL is introduced at the Transactional Level • The USSGL defines the elements of federal transactions • Standard chart of accounts • Standard accounting transactions (proprietary FACTS I) across all government agencies required by GAAP • Standard budgetary transactions (budgetary FACTS II) required by appropriation law • Standard accounting and budgetary reporting elements required by GAAP/FASAB

16. What’s the USSGL?

17. The USSGL Structure provides the Framework for Federal Financial Reporting • Standard Chart of Accounts • Standard Transactions • Crosswalks to External Reports • Crosswalks to GFRS

18. USSGL – Standard Chart of Accounts Foundation for balance rules Foundation for CAO rules Foundation for FASAB rules, and reference

19. What does the USSGL looklike in XBRL-GL?

22. #8 - Who Said This? • “The founders would be proud we’ve become a beacon of liberty and the leader of the free world. They’d also be proud of our superpower status and the relatively high standard of living and degree of personal freedoms enjoyed by most Americans.” • “While I could go on and on about our country’s accomplishments, which are many, there’s little doubt in my mind the founders would also be very concerned about several matters.”

23. Now we have a feel for the standard chart of accounts…….let’s look at USSGL standard transactions.

24. Standard Transactions have a universal transaction code

25. Groups of Codes are organized by categories relating to accounting functions

26. General Categories are further sub-divided

27. What do the definition of thestandard transactions look like in XBRL-GL?

29. #7 - Who Said This? • “Our Founding Fathers also believed in the concepts of prudence and stewardship. They recognized how important it is for a nation to avoid excessive debt and to not unduly burden future generations. Even committed federalists would be surprised by how large the U.S. government has become and how much of our nation’s spending is unrelated to the federal government’s express and enumerated role in the Constitution. We seem to have forgotten the 10th amendment to the Constitution.”

30. OK now let’s lookat a Journal Entry…

31. Here’s an entry to record a collection…. FACTS II Self Balancing Self Balancing FACTS I Do we really receive collections from Federal sources? SF224

32. Let’s see the format of the journal entry in XBRL-GLand then let’s look at a real instance document

36. #6 - Who Said This? • “I can only imagine what the Founding Fathers would think of our government’s massive deficits and growing debt burdens. I’m sure the Founding Fathers would be equally shocked at how little individual Americans save and how eagerly they seem to pile on personal debt. We sure have come a long way from the days of “debtor prisons” and Ben Franklin’s warning that “He who goes a-borrowing goes a-sorrowing.”

37. The Federal Financial Management Improvement Act of 1992 (FFMIA) • Builds on the foundation laid by the CFO Act • by highlighting the need for agencies to have financial management systems that are able to generate reliable, useful, and timely information needed to make fully informed decisions and to ensure accountability on an ongoing basis. • FFMIA requires the major departments and agencies covered by the CFO Act to implement and maintain financial management systems that comply substantially with • (1) federal financial management systems requirements, • (2) applicable federal accounting standards, and • (3) the U.S. Government Standard General Ledger (SGL) at the transaction level.

38. In FY2005 18 of 24 CFO Act Agencies, audit reports indicated they were not in substantial compliance with FFMIA The Audit reports identified six primary reasons for noncompliant agency systems: • 1) nonintegrated financial management systems, • 2) inadequate reconciliation procedures, • 3) lack of accurate and timely recording of financial information, • 4) noncompliance with the SGL, • 5) lack of adherence to federal accounting standards, and • 6)weak security controls over information systems.

40. #5 - Who Said This? • Unfortunately, our government has done a poor job of explaining these numbers to the American people. It seems we still have a long way to go to realize Thomas Jefferson’s idea that the government’s finances should be “as clear and intelligible as a merchant’s book.”

41. What is the problem XBRL is proposing to fix? • Our current system utilizes automated but unstructuredproprietary multi-dimensional data (application centric) based on one-to-one solutions • An XBRL enabled system would utilize automated structuredopen source multi-dimensional data (data centric) based on one-to-many solutions

43. Future XBRL CoP Pilot with Oracle, SAP, CGI, Savantage, Digital, PeopleSoft

44. #4 - Who Said This? • “The federal government still isn’t able to obtain an audit opinion on its annual financial statements, primarily because the Defense Department, which spends over $400 billion per year, is unauditable! Furthermore, the federal government as a whole still lacks a summary annual report that is both useful and used. • It’s a good thing that the Sarbanes-Oxley law doesn’t apply to the federal government. If it did, a number of federal officials might be wearing wide-striped suits.”

45. #3 - Who Said This? • “The bottom line is that our nation’s financial statements and long-range fiscal projections are filled with numbers that are big and bad.”

46. #2 - Who Said This? • “Let’s work together to be sure that the three most powerful words in the Constitution, “we the people,” come alive. If we and other modern-day patriots act, we can help to further the cause of our”

47. A Call for Modern-Day Patriots The Honorable David M. Walker Comptroller General of the United States July 11, 2006