1. FIRST AGA May 13, 2009

2. Integrity from Merriam-Webster Firm adherence to a code of especially moral or artistic values: incorruptibility An unimpaired condition: soundness The quality or state of being complete or undivided: completeness Synonyms, see honesty 1

3. What We Want to Talk About What is FIRST? Why do we need it? What are the its key concepts? What benefits can we expect and when? What are some of the system characteristics? How do we get ready? My challenge: Can I change your mind? 2

4. What IS FIRST? USSGL Database: SID GFRS USSGL based Reporting: GTAS 3

5. What We Will Collect FMS will collect quarterly USSGL-based trial balances, similar to FACTS II but expanded to cover proprietary USSGL accounts and all fund symbols. FMS will edit the inbound trial balances using the central accounting data, Bureau of Public Debt data on investments and borrowings, and rules of the USSGL. FMS will provide instant and actionable feedback to agencies and their auditors. 4

6. Why do we need FIRST? Reporting by agencies to Treasury and OMB is: inconsistent redundant It emphasizes reporting rather than accounting Results are bad 5

7. Why do we need FIRST? Example of a Bad Result: Net Outlays Gross disbursements Less: Offsetting Collections Equal: Net Outlays Less: Receipts Equal: Deficit FY 2008: Net Outlays reported by agencies via monthly 224/1219/1220 differed from SBR outlays by $162 billion government-wide. 6

8. Why do we need FIRST? Conceptual Issues Our model doesn’t work Primacy of the Financial Report of the U. S. Government Standards for the “One” entity that matters Recognition of the Budget Process Constancy of purpose The clean opinion temptation True transparency 7

9. Why do we need FIRST? More specific reasons FY 2008 eliminations differences Non-expenditure transfers: $25 billion Buy-sell: $31 billion The “plug”: $30 billion Shared responsibility, in case you think it’s just an FMS problem 8

10. Why we need FIRST 3 types of inconsistency 1. Inconsistent data in Agency Statements vs. the Financial Report of the U. S. Government. (GFRS addresses this type) 2. Inconsistent data in agency financial statements vs. agency monthly reporting to Treasury and Warrant and NET transactions (Not addressed) 3. Agency financial statement data not consistent with USSGL. (Not addressed) 9

11. Current Situation: FMS makes $1 trillion worth of JVs for the FR each fall. Where will the next problem pop out? 10

12. FIRST-Key Concepts The Financial Report of the U. S. Government has primacy over component financial statements. Preparation of financial statements is an accounting function, not a political one. We must use accounting principles. We will support the Financial Report of the U. S. government with trial balances. The USSGL is the common accounting language we all speak or should speak. Therefore, the collection of USSGL-based trial balances will be the key to our future success. We will replace FACTS I, FACTS II, IFCS and the input part of IRAS, reducing the number of agency reports and standardizing them. We will validate and edit every incoming trial balance using every tool available (USSGL rules, central accounting system, BPD data, etc) and provide instant feedback. 11

13. Business as System GWA Internal Processes Inputs Agency Statements FASAB, TFM, etc Customers President, Congress Citizens Outputs FR A-136 USSGL-based trial balances Detailed edit reports Feedback Accurate data suitable for Analysis. Predictive capability Today, the stuff coming in from the left is bad. We need to help fix it. Agencies supply components that don’t fit the completed machine.

14. Current Stovepipes Undisbursed Trial-balance reports… 224 – Statement of Transactions2108 FACTS I IFCS IRAS GFRS T ROR FACTS II STAR Stovepipes P&F133

15. Future Look USSGL Database: SID GFRS USSGL based Reporting: GTAS GWAMP/USSGL 14

16. Trial Balance Example 1010 d 700 < 4119 d 1000 < 1750 d 300 4170 c 100 < 1759 c 15 4610 c 400 2110 c 300 4901 c 300 3101 c 1000 < 4902 c 200 3103 d 100 < 3107 d 500 5700 c 500 6100 d 200 6710 d 15 8801 c 300 8802 d 300 15

17. Information Sharing—FIRST Steps GWA Account Statement UCAD FACTS II Edit report GWA’s Business Process Group 16

18. Expected Results USSGL Compliance Reduced elimination differences More consistent reporting from each agency that FMS can read, interpret, and consolidate Elimination of obvious and embarrassing discrepancies Better information for decision-making Eventually, a predictive capability 17

19. System Characteristics Supermaf with TAS attributes A trial balance for every Treasury Account Symbol Expenditure accounts like FACTS II, plus receipt accounts, deposit funds, clearing accounts (12,000 per quarter) Beginning and ending balances plus all USSGL attributes Bulk files only CGAC format Instant and usable feedback 18

20. System Characteristics Ready for testing summer 2011 Open for practice all the time after that Agencies must successfully transmit bulk files Ready for production first quarter FY 2012 (January 2012) 19

21. Improved FR Data Edits Agency Accounting Systems Financial Report of the U. S. Government Agency Financial Statements Feedback loop USSGL Database GFRS USSGL based Reporting 20

22. New Process FMSOMB President’s Budget Standard General Ledger FIRST FMS 2108SF 133 Program and Financing Schedule Federal Agency Treasury Annual Reporting Central Accounting System Edits GFRS 21

23. Government-wide Benefits Takes advantage of GWAMP Streamline reporting requirements on agencies Focus on accounting, not reporting Improved quality of financial information Ease of use of the USSGL for agencies Logical, long range approach that attacks core problems (i.e., intra-gov eliminations & budgetary vs. proprietary data consistency) 22

24. Getting Ready Try to send consistent data to FMS. This will force you to communicate within your agency. Use the FACTS II bulk, and generate FACTS II trial balances from your system. Become USSGL compliant. Stop posing and commit!!! Begin using UCAD and Account Statement Attend FIRST forums and/or training class 23

25. Information FIRST GTAS -- http://www.fms.treas.gov/gtashttp://www.fms.treas.gov/gtas USSGL -- http://www.fms.treas.gov/ussglhttp://www.fms.treas.gov/ussgl GWA – https://www.gwa.gov Jeff Hoge -(202) 874-6179 jeffrey.hoge@fms.treas.gov 24