OMB updates financial reporting rules

What: Appendix D to Circular No. A-123, Compliance with the Federal Financial Management Improvement Act of 1996

Why: Federal agencies are getting new flexibility in modernizing their financial management systems, per a Sept. 20 memo from Sylvia Burwell, director of the Office of Management and Budget.

The new framework changes the way agencies comply with the Federal Financial Management Improvement Act (FFMIA), to eliminate some restrictions on technology products and phase out a testing and certification program for the deployment of financial management software, while paving the way for the use of shared services across agencies. The OMB has also established a set of common goals for financial management across all federal agencies. The memo also charges the Treasury Department with developing requirements for federal financial management systems.

Verbatim: "Initial efforts to implement the FFMIA resulted in burdensome compliance frameworks that contributed to outcomes that did not make sense. Specifically, financial system modernization projects all too often cost more than they should, took longer than necessary to deploy, and delivered solutions that did not meet our business needs."