Top Management's Continued Involvement Is ecommendations ensure systems compatibility. The establishment of a chief financial officer position in each HHS operating division, coupled with strong management involvement and commitment at the Assistant Secretary for Management and Budget level, should help ensure the successful implementation of the plan. We recommend that the Secretary closely monitor the accounting system enhancement efforts under the Phoenix Project Plan to ensure that known accounting system problems are corrected and improvements to the Department's financial management environment are occurring. This can be accomplished through periodic briefings and progress reports from the Assistant Secretary for Management and Budget, the Department's Chief Financial Officer, on the operating divisions' system enhancement efforts, including information on slippages in costs and milestones. We further recommend that the Secretary direct the Assistant Secretary for Management and Budget to ensure that the system enhancement efforts under the Phoenix Project Plan are integrated with the programmatic system enhancement efforts to avoid unnecessary developmental cost and to provide for systems compatibility. gency Comments and HHS indicated in its comments that our report did not adequately ur Evaluation describe the actions the Department had underway to improve its accounting and internal control systems. In addition, the Department did not agree with the initial wording of our recommendations to the Secretary. We believe that our report accurately and fairly describes the Department's efforts to improve its accounting and internal control systems. Several of the points raised by the Department are discussed in the report. Specifically, the Department's current efforts to improve its accounting systems through the Phoenix Project Plan and the issuance of the Phoenix Project Design Guidelines are discussed on pages 34 to 37 of the report. In addition, the role of the Deputy Assistant Secretary for Finance and the formation of a financial/accounting/system development group to assist in overseeing the implementation of the Phoenix Project Plan are discussed on page 36 of the report. Further, the report clearly discusses the oversight role that the Department is taking and the expectations it has set forth for each of the operating components. Top Management's Continued Involvement Is Financial Management We believe that the recommendation to the Secretary to closely monitor the Department's system enhancement efforts under the Phoenix Project Plan is valid. Top management should actively participate at key decision points throughout the system's development and implementation. Only with top-level support can a major system become an accepted, integral part of the organization. We also believe that the recommendation to integrate the Department's programmatic system enhancement efforts with those under the Phoenix Project Plan is still valid. We are not suggesting, as implied in HHS' comments, that the Department tie together its accounting systems and its programmatic systems into a single integrated system. Instead, we believe the Department needs to ensure that data transferred between systems is done in the most efficient and cost effective manner. While HHS states that its systems efforts are already being coordinated to avoid unnecessary developmental cost and to ensure systems compatibility, this is not delineated in the Phoenix Project Plan and its implementing design guidelines. For example, the Phoenix Project Plan does not contain specific information on how the programmatic and accounting systems will be integrated throughout the Department as required by OMB Circular A-127. In addition, as discussed in the report, successful implementation of the System Modernization Plan at SSA would improve SSA's ability to account for and control payments made to program beneficiaries. System enhancement efforts at SSA under the System Modernization Plan and the Phoenix Project Plan should be coordinated to avoid unnecessary developmental cost and to ensure systems compatibility. Some of the programmatic information must be entered in the accounting system in order for SSA to accurately report on the status of its programmatic and administrative operations. cial Management Structure of the tment of Health and Human Services Office of the Secretary/Office of Human Development Services Accounting System maintains the Office of the Secretary's general ledger accounts, records the financial results of program and administrative operations, produces internal and external financial reports, and controls the Office of the Secretary's spending authority. This system also maintains the general ledger accounts and controls the spending authority for the Office of Human Development Services. Center for Disease Control Accounting System maintains the agency's Food and Drug Administration Accounting System maintains the National Institutes of Health Central Accounting System captures all Subsidiary Financial Program Financial Financial Management Structure of the Department of Health and Human Services Central Payroll (Civilian/Military) System computes, disburses, Payment Management System accounts for, controls, and makes most Regional Accounting System is a centralized accounting system supporting financial management in the Department's regional offices. In addition, it provides summary financial data to the operating divisions each month. Health Resources and Services Administration Indian Health Service Contract Health Service Management Information System is an automated system that processes payments to and collects statistical data on medical services provided by contractors to patients in Indian Health Service facilities. Social Security Administration Debt Management System records, adjusts, and tracks overpayments made to social security recipients. It also maintains payment information on the status of each Supplemental Security Income program overpayment and identifies the state's share of the overpayment. Social Security Administration Program Benefits System establishes benefit payments for social security recipients, supplemental security income recipients, and Black Lung program claimants. |