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Government Integrated Financial Management Information System

Explore stages, best practices, and strategies for developing, implementing, and maintaining an integrated financial management system in government operations and economic enterprises.

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Government Integrated Financial Management Information System

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  1. Government Integrated Financial Management Information System Dr. Jesse Hughes, CPA, CIA, CGFM Professor Emeritus of Accounting Old Dominion University Email—jhughes@odu.edu

  2. INTRODUCTION • Stages for System Development • Best Practices • Assessments • Government Operations • Economic Enterprises • Whole-of-Government • Coding Structure • Information Technology • Training • Action Plan • Strategies

  3. STAGES FOR SYSTEM DEVELOPMENT • Assessment • Design • Procurement • Implementation

  4. BEST PRACTICES • International Public Sector Accounting Standards (IFAC) • Government Finance Statistics Manual (IMF) • Other Country Experiences

  5. SPECTRUM FOR ACCOUNTING SYSTEM DEVELOPMENT

  6. GOVERNMENT OPERATIONS • Cash Based System for Budgetary Control • Accrual Based System for Financial Statements • Links to Other Systems • Procurement • Personnel • Pensioners

  7. GOVERNMENT OPERATIONS • Standard Chart of Accounts • Statement of Financial Position • Statement of Financial Performance • Statement of Changes in Net Assets • Statement of Cash Flows • Eliminate Intra-Group Transactions to Prevent Double-Counting during Consolidation

  8. ECONOMIC ENTERPRISES • Standard Chart of Accounts • Balance Sheet • Income Statement • Statement of Changes in Equity • Statement of Cash Flows • Eliminate Intra-Group Transactions to Prevent Double-Counting during Consolidation

  9. WHOLE-OF-GOVERNMENT • Standard Chart of Accounts • Consolidated Statement of Financial Position • Consolidated Statement of Financial Performance • Consolidated Statement of Changes in Net Assets • Consolidated Statement of Cash Flows • Eliminate Intra-Group Transactions to Prevent Double-Counting during Consolidation

  10. CODING STRUCTURE • Transaction Code • Fiscal Year • Fund • Organization • Program or Function • Geographic • Chart of Accounts

  11. P F S ROPOSED UND TRUCTURE Consolidated Whole-of-Government Fiduciary (Full Accrual Accounting) Consolidated Proprietary Consolidated Governmental (Full Accrual Accounting) (Full Accrual Accounting) Non-Current Non-Current Assets Liabilities (Partial Accrual Accounting) Internal Capital Debt Economic Trusts General/ Special Revenue Agencies Services Projects Service Enterprises Proprietary Fiduciary Governmental

  12. CHART OF ACCOUNTS • Budgetary Accounts • Expenditures • Economic (8 major classes) • Compensation of Employees • Use of Goods and Services • Consumption of Fixed Capital • Interest • Subsidies • Grants • Social Benefits • All Others

  13. CHART OF ACCOUNTS (CONTINUED) • Expenditures (continued) • Functional (10 major classes) • General Public Services • Defense • Public Order and Safety • Economic Affairs • Environmental Protection • Housing and Community Amenities • Health • Recreation, culture, and religion • Education • Social Protection

  14. CHART OF ACCOUNTS (CONTINUED) • Revenues (4 major classes) • Taxes • Social Contribution • Grants • All Others • Assets • Liabilities • Net Assets

  15. NETWORK INFRA-STRUCTURE STRATEGY • Servers (backbone of the infra-structure) • Software (glue that holds all the pieces together) • Storage (groups storage systems on their own high-speed networks)

  16. TRAINING • Develop Core Group of Trainers • Acquire additional computers for training room • Expand financial library to include accounting standards desired by international accounting oversight bodies

  17. TRAINING (CONTINUED) • Accrual Accounting • International Public Sector Accounting Standards • International Accounting Standards • Government Finance Statistics Manual • IFMIS Coding Structure • Network Architecture • Links to Other Systems

  18. ACTION PLAN • Steps to Implementation • Short-Term (1-2 Years) • Continue Design Phase to develop detailed specifications • Revise applicable laws to permit use of accounting standards desired by international accounting oversight bodies • Modify existing software to implement double-entry cash accounting system • Mid-Term (3-5 Years) • Acquire additional software and hardware to implement double-entry partial accrual accounting system for financial assets and liabilities

  19. ACTION PLAN (CONTINUED) • Steps to Implementation (continued) • Long-Term (Over 5 Years) • Implement double-entry full accrual accounting system for non-financial assets and long-term debt • Packaged Software • Technical Architecture

  20. PACKAGED SOFTWARE CONSIDERATIONS • Goodness of Fit • System Scalability • Size • Speed • Workload • Transaction Cost • Outside Consulting Support

  21. STRATEGIES FOR IMPLEMENTATION • Appoint Steering Committee (for policy) and full-time Project Team (for procedures) • Identify specific software and hardware needs during design phase • Prepare Users’ Manuals • Conduct training programs • Pilot test programs • Implement throughout MOF • Roll out to other ministries

  22. POST-IMPLEMENTATION REVIEW • Accuracy of Time, Cost, and Benefit Estimates • Adequacy of System Design • Accountable • Controllable • Transparent • Sustainable

  23. GLOBAL IMPLICATIONS

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