CFOs: Use more financial data

Agencies prepare numerous financial reports to comply with laws and Office of Management and Budget policies, but the data in those reports could do more if program managers realized its value, financial experts say.For example, chief financial officers could extract financial data from year-end statements and financial performance reports to help program managers make better business decisions. The key to improving the situation is for CFOs to involve more program managers, who must determine what data they need daily or weekly in order to accomplish their goals, said Linda Combs, who retired earlier this month as OMB’s controller. “Making managerial and financial information meaningful and usable will drive better financial practices throughout every level of the business unit,” she said. Agencies can now produce more financial data and turn it around faster because many of them are using modernized financial systems. With those and other available technologies, such as radio frequency identification and the Extensible Business Reporting Language, agencies should be able to deliver accurate and useful financial data in near real time, said Sam Mok, former CFO at the Labor Department and president-elect of the Association of Government Accountants.Officials say program managers could be missing an opportunity when they don’t use that data. “If we can bring the benefits to decision-makers and program folks, then I don’t have to lean on them all the time,” Phyllis Scheinberg, the Transportation Department’s CFO, said at a recent industry conference. “It’s a struggle and a disappointment that we have this system, integration and good data,” she added. “But then you have program folks who don’t quite see it.” Oversight officials point out that more data could force greater accountability. Some program managers don’t want the data because it might mean they would be held more accountable for how they use their assets, said Jeffrey Steinhoff, managing director of financial management and assurance at the Government Accountability Office.Others don’t often use available data because they aren’t used to having it, said Danny Harris, deputy CFO at the Education Department and chairman of the Financial Systems Oversight Team for the CFO Council.The best way to get program managers to use financial data is to foster competition among them, Harris said. The CFO’s office encourages such competition by publishing Fast Facts, a quarterly report on performance metrics. It appears on the agency’s intranet.“Now every single program office sees how they rate on different measures,” Harris said.The department’s CFO’s office goes further. It offers program managers help with improving their performance metrics. “We didn’t use it to just hang [program managers] out to dry,” Harris said. The CFO’s office meets monthly with each program and administrative office to help them. “They’re not financial managers, and we’re not trying to make them financial managers, but we are trying to help them see that everything they do has a financial impact on the department’s operation,” Harris said.Fast Facts has had an effect, he added. Education Department programs have reduced their interest penalties on payments to other agencies. Publishing those metrics has also helped the CFO’s office.“It has forced us to generate better reports and better data,” Harris said. “If you’re going to measure someone on progress, your numbers better be right.” To get more program managers involved in using financial data, CFOs might need to step into the role of management consultants and advisers on ways to achieve greater efficiencies, said Anton Porter, deputy CFO of the Federal Energy Regulatory Commission. “We have to change the classical view of accountants from wearing the green eyeshades to being more management consultants to program managers,” he said.