Photo by Karl Steinbrenner FOCUS Spring, 2008 DOA Update David A. Von Moll State Comptroller May 13, 2008

2 Presentation Overview Direct Deposit and Payline Charge Card Program Restructuring Incentive Payments Financial Reporting Compliance Oversight Enterprise Applications Questions?

3 Direct Deposit and Payline Effective July 1, 2008 –Mandatory direct deposit (or paycard) for new hires –Prohibit direct deposit unless net pay is direct deposited –Allow institutions to mandate direct deposit for current employees Effective January 1, 2009 –Mandatory elimination of printed earnings notices for employees with state-issued PCs and internet access

4 Charge Card Program GE Card Services was bought by American Express (AMEX) Contract status RFP Panel –DOA, DGS, Psub, VASCUP, Agency, APA –Fiscal, purchasing, auditing, charge card administration

5 Restructuring Charge Card Rebate –FY 09 appropriation – $1.6 million –FY 08 appropriation shortfall – 9.9%, $187,000 –OMB A-87 Impact FY 08 actual – $467,487 FY 09 estimated – $400,000 Interest – Tier 1s and 3s –FY 09 appropriation – $15.1 million –FY 08 appropriation shortfall – 27%, $4 million Interest – Tier 3s –Escrow payments Tier 1s and Tier 3s –Cash and suspense account balances

6 Financial Reporting Directive GASB Statements effective for FY 2008 –45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than Pensions –47, Accounting for Termination Benefits (OPEB-related) –48, Sales of Pledges of Receivables and Future Revenues and Intra-Entity Transfers of Assets and Future Revenues –50, Pension Disclosures GASB Statements effective for FY 2009 –49, Accounting and Financial Reporting for Pollution Remediation Obligations –52, Land and Other Real Estate Held as Investments by Endowments GASB Statements effective for FY 2010 –51, Accounting and Financial Reporting for Intangible Assets

7 Financial Reporting Directive Planned Issuance date – week of May 19 HE 10 Template Revisions –Reconciliation between the template and financial statements incorporated within the HE 10 template –Additional variance check figures to help identify “errors” –Additional formulas to identify fluctuations requiring explanation Tier 3 – supplemental cash basis data –Needed for statewide indirect cost allocation reporting Report on Financial Condition attachment modified –APA requires final rather than draft financial statements Off-Balance Sheet financial obligation information

8 Off-Balance Sheet Obligations Code § Biannual disclosure by Comptroller of other obligations of the Commonwealth. To assist in the managing, planning, and budgeting of the state's financial resources, the Comptroller, in conjunction with the Secretary of Finance, shall report biannually to the Governor and the members of the General Assembly each off-balance sheet financial obligation of the Commonwealth, itemized by agency, board, institution, or authority of the Commonwealth, and such other obligations of the Commonwealth that are estimated by the Comptroller to be incurred.

9 Off-Balance Sheet Obligations Legal or contractual obligations to disburse funds or pledge revenues in future periods Examples: –Operating leases –Construction and other contract commitments –Deferred maintenance –PPEA agreements –Questioned federal costs –Termination benefits –Pollution clean-up site costs –Legal case settlements and court orders Obligations meeting the accounting definition of liabilities or otherwise reported are excluded

10 Compliance Oversight Initiatives ARMICS –Standing Directive Issued –Stage 1 and 2 Reviews Quality Assurance Reviews –Financial Reporting Directive Compliance –Reconciliation Compliance Disbursements Compliance –Memorandums of Understanding (MOUs)

11 Enterprise Applications Activities completed towards Enterprise Financials –Future State documents (GL, AP, AR, FA, T&A, Purchasing, Cost Accounting, Performance Budgeting) –RFP with Enterprise system requirements Activities nearly completed –New Commonwealth Chart of Accounts –Business Process Improvements candidate papers Virginia Enterprise Application Program (VEAP) office projects –Performance Budgeting – funded through PPEA –Business Intelligence – funded through PPEA –Data Standards – priority on Financials with DOA –Enterprise Financials – not funded, RFP put on hold

12 Enterprise Applications - Financials VEAP, DOA and VDOT (lead agency) are teaming to provide an enterprise financial system –VDOT – funded by VDOT FMS II system replacement (GL, AP, AR, Purchasing, Cost Accounting, T&A) – FY 2011 RFP based on Enterprise Financials requirements Joint project governance using Enterprise Financials Data Standards –DOA – funded by VEAP through PPEA VEAP Financials “Base” – CARS functionality (GL, AP) replicated First implementation of VEAP Financials “Base” solution at VDOT – FY 2012 Subject to funding availability: –Begin statewide roll-out of Base solution to other agencies (towards CARS replacement) –Enhance functionality of base solution (AR, Purchasing, Cost Accounting, T&A)

13 Questions? Contact Info: David A. Von Moll