Financial Systems Integration Office is closing its doors

The Financial Systems Integration Office, which has worked to create business process and data standards for the Financial Management Line of Business, is shutting down next week.

The Office of Management and Budget decided FSIO, which was launched as the Joint Financial Management Improvement Program within the General Services Administration, has met its goals according to a memo issued on March 16 to agency chief financial officers by Danny Werfel, OMB’s controller.

OMB and FSIO have agreed that FSIO will cease operations by March 31. FSIO will then issue an update to the Core Financial Systems Requirements and will publish use cases for the standard business processes.

Werfel noted that “FSIO has played a critical role in developing and implementing the core financial systems requirements, testing and product certification program as well as in managing the FMLoB.”

Since FSIO has achieved its objectives in these areas, OMB and the General Services Administration have agreed that FSIO will cease operations effective March 31, 2010, Werfel said.

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Labor Department takes financial management to the clouds

Moreover, “rapid advances in technology are requiring us to rethink how we implement financial systems,” Werfel wrote. Long implementation times for these systems cause many of them to be outdated by the time they are deployed because technology has changed.

As a result, “our financial systems are also not meeting agency programmatic needs or producing the right information to support decision-making,” Werfel wrote.

“In response to these challenges, we have reassessed the need for the core financial systems testing and product certification program and will be discontinuing this function.”

In an interview on Federal News Radio on March 19, Lisa Fiely, a former deputy chief financial officer with the Labor Department and now a director with Grant Thornton, said it is unfortunate FSIO is being shut down. FSIO certified software vendors who went through a rigorous testing period to make sure they handled government transactions in an appropriate manner.

Fiely’s concern is that if there is not an office to provide that discipline, vendors might self-certify systems that are not handling government transactions properly. If a new office is established it must be within an existing government entity, something new can’t be created in a short period of time.

Fiely acknowledged that FSIO was not agile enough to act quickly to technology changes and that new paths need to be paved for the implementation of financial systems.

Some of those paths may lead to a software-as-a-service, cloud computing model.

Prior to Fiely’s retirement, Labor officials replaced their 20-year-old financial management system with a preconfigured solution that is integrated across more than 22 agencies and organizations.

Labor is using Government Computer Enterprise’s (GCE) financial management Shared Service Provider Appliance, which is based on Oracle Financials Release 12. As a result, the agency has retired its old, Cobol-based, mainframe system.

To provide cloud computing-based solutions, all of the stakeholders involved including agencies, cloud providers and vendors will need an office or hub where they can come together to agree upon a standard way of implementing financial systems in the cloud, said David Lucas, chief strategy officer of GCE, who worked with Fiely for two years as a contractor on the Oracle financial project.

“Our concern is, will there be a new standards body in place?” Lucas said, echoing some of Fiely’s sentiments. Cloud providers don’t want to start from scratch and build a different system for every agency, that would negate the economic and operational efficiencies of the cloud, he said.

“I’m not saying that you can’t offer standardized cloud-based [solutions] without FSIO, but efforts will be enhanced with a standards body, he noted.

Lucas hopes OMB will provide information on what industry’s role will be moving forward so agencies, cloud providers, and vendors can take advantage of the next wave of computing in the cloud.

FSIO will host its annual federal financial management conference in Washington, D.C., March 23.