The CFO Act of 1990 accomplished the original objectives and without doubt, improved accountability, management and reporting within the government. However, it is due for some revisions that will create savings for the government, and in turn, the taxpayers. Currently, financial statements are prepared on a quarterly basis and reviewed by independent contracted auditors. OMB should revise this schedule to make reporting a “trimester” cycle. The reporting dates should end on January, May, and September, instead of December, March, June, and September.
In recent years, at the end of the first quarter in December, many agencies have been operating under a CR and usually have just received the final yearly appropriations. However, agencies are required to prepare financial statements that are reviewed by contracted auditors. The reporting cycle creates minimum or arguably no benefit for the government or its taxpayers. By moving to a three date reporting cycle, the first reports would be more meaningful and more cost effective without jeopardizing any funds management or reporting.
The CFO Act has met its original objectives and the four reporting dates were necessary to create the change that was needed; however, revisions will save the taxpayers’ money, create efficiencies within the government and will not jeopardize any financial management requirements. Controls can be placed on agencies that only those with unqualified opinions or those without material weakness qualify. This also reduces the cost substantially by reducing unnecessary audits, reducing overtime and improving work hours for the financial management community. Currently, the reporting dates fall within the Christmas holiday, New Year season and Fourth of July. This has caused a high turnover rate of employees within the reporting areas which cost the government because agencies are consistently replacing employees and incurring training cost at a rate much higher than necessary.
This implementation would be a low risk change in financial management policy.