GAO CORE FINANCIAL SYSTEM REQUIREMENTS Checklist for Reviewing Systems Under the

GAOUnited States General Accounting Office

Financial Management Series

February 2000 CORE FINANCIAL SYSTEM REQUIREMENTS

Checklist for Reviewing Systems Under the Federal Financial Management Improvement Act

GAO/AIMD-00-21.2.2

GAO/AIMD-00-21.2.2 – Core Financial Systems Requirements Checklist (2/00)

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PREFACE

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B-284426

The Federal Financial Management Improvement Act (FFMIA) of 1996 requires, amongother things, that agencies implement and maintain financial management systems thatsubstantially comply with federal financial management systems requirements. Theserequirements are detailed in the Financial Management Systems Requirements seriesissued by the Joint Financial Management Improvement Program (JFMIP) and in Officeof Management and Budget (OMB) Circular A-127, Financial Management Systems, andOMB’s Implementation Guidance for the Federal Financial Management ImprovementAct (FFMIA) of 1996, issued September 9, 1997. JFMIP intends for the requirements topromote understanding of key financial management systems concepts and requirements,to provide a framework for establishing integrated financial management systems tosupport program and financial managers, and to describe specific requirements ofindividual types of financial management systems.

We are issuing this checklist that reflects JFMIP’s revised Core Financial SystemRequirements (February 1999) to assist (1) agencies in implementing and monitoringtheir core systems and (2) management and auditors in reviewing agency core systems todetermine if they substantially comply with FFMIA. This checklist is not required to beused in assessing the core system. It is provided as a tool for use by experienced staff.This checklist, the JFMIP source document, and the two previously mentioned OMBdocuments should be used concurrently. Experienced judgment must be applied in theinterpretation and application of this tool to enable a user to consider the impact of thecompleted checklist on an entire core system and whether the system, as a whole,substantially complies with requirements.

Additional copies of this checklist can be obtained from Room 1100, 700 4th St. NW, U.S.General Accounting Office, Washington, D.C. 20548, or by calling (202) 512-6000, or TDD(202) 512-2537. This checklist replaces GAO’s previously issued Core Financial SystemChecklist (May 1998) and is available on the Internet on GAO’s Home Page(www.gao.gov) under “Special Publications.”

[signed]

Jeffrey C. SteinhoffActing Assistant Comptroller GeneralAccounting and Information Management Division


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CONTENTS

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Preface 1

Overview 5Authoritative Guidance 6How to Use This Checklist 7

Systems Requirements 9Core Financial System Management Function 11General Ledger Management Function 24Funds Management Function 27Payment Management Function 38Receipt Management Function 49Cost Management Function 56Reporting Function 61

Figure

Figure 1: Agency Systems Architecture 5

Abbreviations

ABA American Banking AssociationACH automated clearing houseBPA blanket purchase agreementCFO Chief Financial OfficersDUNS data universal numbering systemEFT electronic funds transferEIN employer identification numberFASAB Federal Accounting Standards Advisory BoardFAST federal account symbols and titlesFFMIA Federal Financial Management Improvement ActFMFIA Federal Managers’ Financial Integrity ActFMSS Financial Management Systems SoftwareGPO Government Printing OfficeGSA General Services AdministrationID identification numberIRS Internal Revenue ServiceJFMIP Joint Financial Management Improvement ProgramNARA National Archives and Records AdministrationOMB Office of Management and BudgetPMO Program Management OfficeSGL U.S. Government Standard General LedgerSSN social security numberTFM Treasury Financial ManualTIN taxpayer identification number


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OVERVIEW

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The Federal Financial Management Improvement Act (FFMIA) of 1996 requires, amongother things, that agencies implement and maintain financial management systems thatsubstantially comply with federal financial management systems requirements. Thesesystem requirements are detailed in the Financial Management Systems Requirementsseries issued by the Joint Financial Management Improvement Program (JFMIP)1 andOffice of Management and Budget (OMB) Circular A-127, Financial Management Systems.JFMIP requirements documents identify (1) a framework for financial managementsystems, (2) core financial systems requirements, and (3) 16 other financial and mixedsystems supporting agency operations, not all of which are applicable to all agencies.Figure 1 is the JFMIP model that illustrates how these systems interrelate in an agency'soverall systems architecture.

Figure 1: Agency Systems Architecture

Source: JFMIP Core Financial System Requirements document.

1JFMIP is a joint cooperative undertaking of the Office of Management and Budget, theGeneral Accounting Office, the Department of Treasury, and the Office of PersonnelManagement, working in cooperation with each other and with operating agencies toimprove financial management practices throughout the government. The program wasinitiated in 1948 by the Secretary of the Treasury, the Director of the Bureau of theBudget (now OMB), and the Comptroller General and was given statutory authorizationin the Budget and Accounting Procedures Act of 1950. The Civil Service Commission,now the Office of Personnel Management (OPM), joined JFMIP in 1966.


To date, JFMIP has issued the framework document and systems requirements for thecore financial system and 7 of the 16 systems identified in the architecture. (See figure1.)2

We are issuing this checklist that reflects JFMIP’s revised Core Financial SystemRequirements (February 1999) to assist (1) agencies in implementing and monitoringtheir core systems and (2) management and auditors in reviewing agency core systems todetermine if they substantially comply with FFMIA. This checklist is not required to beused in assessing the core system. It is provided as a tool for use by experienced staff.This checklist, the JFMIP source document, OMB Circular A-127, and OMB’sImplementation Guidance for the Federal Financial Management Improvement Act(FFMIA) of 1996, issued September 9, 1997 should be used concurrently. Experiencedjudgment must be applied in the interpretation and application of this tool to enable auser to consider the impact of the completed checklist on the entire core system andwhether the system, as a whole, substantially complies with requirements.

Authoritative Guidance

OMB Circular A-127 and OMB’s implementation guidance provide the basis for assessingcompliance with the FFMIA requirements for agencies to implement and maintainfinancial management systems that comply substantially with federal requirements. Theimplementation guidance identifies various criteria that an agency must meet tosubstantially comply with these requirements. One of the criteria listed in the OMBguidance is the JFMIP systems requirements series.

The source of all the questions in this checklist is the JFMIP Core Financial SystemRequirements (JFMIP-SR-99-4, February 1999). This JFMIP document represents thethird update to the core document, first issued in January 1988. This most recent updateclarifies some of the existing requirements, reflects changes in laws and regulations, suchas the Debt Collection Improvement Act, and adds requirements for budget execution andrevolving fund functions. The JFMIP requirements remain the basis for the federalgovernment to test compliance of commercially based, core financial software. Duringfiscal year 1999, JFMIP’s new Program Management Office (PMO) developed a newtesting and qualification process, directly linking tests back to these requirements. Thechecklist is based on existing published JFMIP standards, and that changes in laws,regulations, and standards and practices since the standards were issued are not includedin the checklist.

2Thus far, the series includes the (1) Framework for Federal Financial ManagementSystems, (2) Core Financial System Requirements, (3) Inventory System Requirements,(4) Seized/Forfeited Asset System Requirements, (5) Direct Loan System Requirements,(6) Guaranteed Loan System Requirements, (7) Travel System Requirements, (8) HumanResources & Payroll System Requirements, and (9) System Requirements for ManagerialCost Accounting. In early 1998, JFMIP decided to initiate projects to update systemrequirements documents that were not current with regulations and legislation. JFMIPalso planned to initiate projects to complete the remaining systems requirements.


How to Use This Checklist

OMB’s 1997 implementation guidance provides chief financial officers and inspectorsgeneral with a means for determining whether their agencies’ financial managementsystems substantially comply with federal financial management systems requirements.The annual reporting required pursuant to section 4 of the Federal Managers’ FinancialIntegrity Act (FMFIA) is one of the means to assist agencies in the determination ofsubstantial compliance. Agencies can also use this checklist and JFMIP’s core test astools to help determine annual compliance with section 4 of this act.3

Filling out this checklist will allow agencies to systematically determine whether specificsystem requirements are being met. In determining substantial compliance, agenciesshould assess the results of the completed checklist on the core system requirementstaken as a whole.

The checklist contains three columns with the first citing the question to be answered.Use the second column to answer each question “yes,” “no,” or “na.” Use the thirdcolumn to explain your answer. A “yes” answer should indicate that the agency’s coresystem provides for the capability described in the question. For each “yes” answer, thethird column should contain a brief description of how the core system contains thecapability and should also refer to a source that explains or shows the capability.

A “no” answer indicates that the capability does not exist. For a “no” answer, the thirdcolumn should provide an explanation and, where applicable, a reference to any relatedsupporting documentation (e.g., the agency is working on modifying or implementing itscore system to have the capability available in subsequent years; management believesthe capability is not cost-effective and will not enhance the core system’s ability tomanage operations). Cost-benefit studies, or other reasoning, that supports a “no”answer should be identified in the explanation column. If there are no cost-benefitstudies or other support, a full explanation should be provided.

“No” answers should not be viewed individually or taken out of context. Rather, “no”answers should be assessed as to the impact on the overall core system and the extent towhich reasons for the “no” answers preclude the entire core system from beingsubstantially compliant.

Certain questions within the checklist may not be applicable to every agency. Answersuch question(s) with “na” and explain why in the third column.

3In addition, the Chief Financial Officers (CFO) Council has charged the FinancialSystems Committee with developing implementation guidance for performing FFMIAcompliance reviews. The CFO Council and JFMIP plan to jointly issue the guidance.


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CORE FINANCIAL SYSTEM REQUIREMENTS

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JFMIP’s Core Financial System Requirements helps agencies meet governmentrequirements by establishing standard requirements to support an agency’s integratedfinancial management system. It provides common processing routines, supportscommon data for critical financial management functions affecting the entire agency, andmaintains the required financial data integrity control over financial transactions,resource balances, and other financial management systems.

The seven functions of the core financial system are discussed below.

1. Core financial management consists of the processes necessary to maintain system-processing rules consistent with established financial management policy. Thisfunction sets the framework in which all other core financial system functionsoperate. (The checklist questions for this area are drawn from pp. 16-21 of the JFMIPsource document.)

2. General ledger management is the central function of the core financial system. Thegeneral ledger is the highest level of summarization and must maintain accountbalances by the fund structure and individual general ledger accounts established inthe core financial system management function. (The checklist questions for thisarea are drawn from pp. 22-23 of the JFMIP source document.)

3. Funds management is a system for ensuring that the agency does not obligate ordisburse funds in excess of those appropriated and/or authorized. (The checklistquestions for this area are drawn from pp. 24-28 of the JFMIP source document.)

4. Payment management is a function that provides appropriate control over allpayments made by or on behalf of an agency. (The checklist questions for this areaare drawn from pp. 29-33 of the JFMIP source document.)

5. Receipt management is the function that supports activities associated with recordingagency cash receipts, including servicing and collecting receivables. (The checklistquestions for this area are drawn from pp. 34-37 of the JFMIP source document.)

6. Cost management attempts to measure the full cost of federal programs, theiractivities, and outputs. (The checklist questions for this area are drawn from pp. 38-40 of the JFMIP source document.)

7. Reporting is the function that provides useful financial information on time to(1) support management’s fiduciary role, (2) support budget formulation andexecution functions, (3) support fiscal management of program delivery and programdecision- making, (4) support internal and external reporting requirements, including,as necessary, the requirements for financial statements prepared in accordance withthe form and content prescribed by OMB, reporting requirements prescribed byTreasury, and legal, regulatory, and other special management requirements of theagency; and (5) monitor the financial management system. (The checklist questionsfor this area are drawn from pp. 41-43 of the JFMIP source document.)


Core Financial System Requirements

The checklist questions follow the JFMIP source document. It should be noted that notall questions will apply in all situations and, as with the use of any checklist, professionaljudgment should be exercised. Using the JFMIP source document, and appendix b of thesource document which defines terms used, along with the two previously mentionedOMB documents, will help ensure that the user is cognizant of the backgroundinformation necessary to fully understand the questions.

Also, the checklist should also be used in conjunction with JFMIP’s WEB-basedelectronic repository, called the Knowledgebase, which can be reached through theJFMIP/PMO homepage http://www.financenet.gov/fed/jfmip/pmo.htm. The corerequirements will form the major portion of the Knowledgebase. In addition, technicaland vendor support requirements are included in the Knowledgebase and are comprisedof internal controls, security, year 2000, training, documentation and other requirements.The Knowledgebase will feature ongoing comment capability, for both agencies andvendors, including the ability to comment on proposed requirements prior to theirestablishment.

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Page 11 GAO/AIMD-00-21.2.2 – Core Financial Systems Requirements Checklist (2/00)

Core financial system

management function

Yes/no/

na Explanation

Accounting classification

structure management process

1. Does the system provide thecapability to classify accountingtransactions by the followingstructures: fund, program,organization, project, activity,cost center, object class, andany other data elements neededto meet the data classificationand/or reporting needs of theagency? This will includerelating Federal AccountSymbols and Titles (FAST)structures established byTreasury in the system’s fundstructure for reportingpurposes.

2. Does the system achieveconsistency in budget andaccounting classifications andsynchronization between thoseclassifications and theorganizational structure?Consistency will includemaintaining data relationshipsbetween budget formulationaccount code classifications(budget accounts published inthe President’s budget), budgetexecution and accountingclassifications (appropriationfund symbols published in theTreasury annual reportappendix and other Treasurypublications), and the agency’sorganizational structure (thegroups and/or individuals whohave responsibility for theaccount coding classifications).

3. Does the system provide a fundstructure that defines eachentity for which separate

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management function

Yes/no/

na Explanation

accounting and reporting areneeded to meet legal andassigned responsibilities andreporting requirements? Thisstructure should provide foridentification of appropriationor fund accounts established byOMB and Treasury through thebudget process, receiptaccounts, credit program andfinancing accounts, depositfunds, clearing accounts, andother accounts as may bedeemed necessary. The fundstructure must provide foradditional detail below theappropriation level to supportfiscal year accounting,appropriation sub-accountsused for reporting to Treasury,and financial statementpreparation.

4. Does the system differentiatebetween the type of budgeting,accounting, and reportingtreatments to be used for eachfund (e.g., annual appropriation,multiyear appropriation, no-yearappropriation, revolving fund,trust fund, receipt account)?The account classificationstructure will provide additionalfund structure information thatsupports the detailedaccounting and reportingneeded to fulfill legalrequirements, reportingrequirements, and assignedresponsibilities. At a minimum,these characteristics must besupported: fund type, e.g.,general fund, deposit fund, trustfund revolving fund; borrowingsource, and OMB functiondesignations; budget status, e.g.,

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management function

Yes/no/

na Explanation

on budget, off budget, orfinancing account; and the fiscalyear designation, e.g., annual,multiyear, or no-year obligationauthority.

5. Does the system provide aprogram structure withsufficient levels of detail toallow reporting for allcategories on which budgetarydecisions are made, whetherlegally binding, as inappropriation limitations, or inthe nature of policy guidance, asin Presidential pass-backs,congressional markup tables, orinternal agency decisions? Theaccount classification structuremust also support additionaldetail needed to meet externalreporting requirements to OMBand Treasury and be flexibleenough to meet agency-specificrequirements.

6. Does the system provide thecapability to establish anorganization structure based onresponsibility segments, such asoffices, divisions, and branches?

7. Does the system provide for theability to tie responsibleorganizational units to programsand projects?

8. Does the system identify agencylocation codes andappropriation fund symbols forall transactions and reportsinvolving Treasury disbursingcenters, such as SF-224“Statement of CashTransactions,” SF-215 “Deposit

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management function

Yes/no/

na Explanation

Ticket,” and SF-5515 “DebitVoucher?”

9. Does the system provide aproject structure that isindependent of the otherclassification structures toallow multiple organizations,programs, and funding sourcesto be associated with a project?

10. Does the system provide anobject class structure consistentwith the standard object classcodes contained in OMBCircular A-11, Preparation andSubmission of BudgetEstimates? This structure mustalso accommodate additionallevels (higher and/or lower)needed to support agencymanagement reporting andcontrol needs.

11. Does the system provide arevenue source code structureto identify and classify types ofrevenue and receipts receivedby an agency so that they arerepresented properly on theagency’s financial statements?

12. Does the system provide thecapability to classify accountingtransactions by other dataelements needed to meet thedata classification and/orreporting needs of the agency?

13. Does the system provide thecapability to define additionaldata elements for use in dataclassification for internalreporting and/or control needsfor agency-specific purposes?

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management function

Yes/no/

na Explanation

14. Does the system derive theexpanded accountingclassification structure fromabbreviated user input so thatuser input is minimized, dataentry is made easier, and errorsare controlled and reduced?Examples of methods includeentering “shorthand codes”using a keyboard function tolook up additional elements,“clicking” on entries in a“lookup table” or “pop-upmenu,” and using a scanning barcode.

15. Does the system provideflexibility to process additions,deletions, and changes toaccounting classificationstructure codes withoutextensive program or systemchanges? Table-driven systems,where frequently changedinformation is kept in tablesseparate from program logicand under a systemadministrator’s control, anddatabase management systems,are two examples of ways toprovide such flexibility.

16. Does the system provide theability to account for budgetaryresources at a lower level in theaccounting classificationstructure than they arebudgeted and controlled?

The U. S. Government Standard

General Ledger (SGL) process –

account definition

17. Does the system use a chart ofaccounts consistent with the

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management function

Yes/no/

na Explanation

basic numbering structureprovided in the SGL? Anyexpansion to the numberingsystem must roll up to theposting accounts provided inthe SGL.

18. Does the system incorporateboth proprietary and budgetaryaccounts in the system, andmaintain the relationshipsbetween accounts as describedin the SGL?

19. Does the system use accounttitles consistent with theaccount titles provided in theSGL?

20. Does the system providesubsidiary ledger support forSGL accounts? Support may beas detailed as the agency deemsappropriate for asset protection,management information, andfund accounting. The systemmust also support reconciliationof SGL control accounts to theirrespective subsidiary records byaccounting period.

21. Does the system support an SGLaccount structure for multipleappropriations (includingreceipt accounts) or funds andmultiple fiscal years within theappropriations, includingannual, multiyear, and no-yearappropriations?

22. Does the system support the useof processing of informationconsistent with the standardtransaction identificationprocess rules from SGL?

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management function

Yes/no/

na Explanation

23. Does the system provide thecapability to create additionalsub-accounts to the SGL foragency specific tracking andcontrol? These sub-accountswill summarize and track backto the SGL accounts.

The standard general ledger

process - transaction definition

24. Does the system usestandardized transactionsidentified by reference codes tocontrol transaction editing,posting to the appropriate SGLaccounts, and updating of otherinformation maintained in thesystem, such as documentbalances and available funding?

25. Does the system allowstandardized transactions,including system-generatedtransactions, to be established,modified, or deleted byauthorized personnel?

26. Does the system provide fortraceability of changes?

27. Does the system update bothbudgetary and proprietaryaccounts based on a single inputtransaction?

28. Does the system generate andpost compound SGL debit andcredit entries (at least fourpairs) to the SGL as a result of asingle transaction?

29. Does the system processsystem-generated transactions,

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management function

Yes/no/

na Explanation

such as automated accruals,closing entries, cost assignmenttransactions, recurringpayments, and transactions thatgenerate other transactions inthose cases where a singletransaction is not sufficient?

30. Does the system automaticallyliquidate, partially or in full,document balances throughdesignated transaction codes?This capability will be used inthe liquidation of commitments,undelivered orders, payables,receivables, or other items, asappropriate.

31. Does the system provide thecapability to add, modify, andmaintain editing and postingrules through systems tablescontrolled by authorizedpersonnel?

32. Does the system performintegrity checks on batchesreceived via interfaces? Checksshould include a batch numberto detect duplicate or skippedbatches, and validity of headerand trailer records to ensurethat counts and amount in thetrailer agree with records in thebatch.

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management function

Yes/no/

na Explanation

Transaction control process –

audit trails

33. Does the system provide audittrails to trace transactions fromsource documents, originalinput, other systems, system-generated transactions, andinternal assignment transactionsthrough the system?

34. Does the system providetransaction details to supportaccount balances?

35. Does the system provide audittrails to trace source documentsand transactions throughsuccessive levels ofsummarization to the financialstatements and the reverse?

36. Does the system provide audittrails to identify changes madeto system parameters and tablesthat would affect the processingor reprocessing of any financialtransactions?

37. Does the system select items forreview based on user-definedcriteria by type of transaction?Examples of reasons to selectitems are payment certificationand financial statement audits.

38. Does the system provide audittrails that identify documentinput, change, approval, anddeletions by originator?

Transaction control process –

transaction processing

39. Does the system post to the

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management function

Yes/no/

na Explanation

current and prior monthsconcurrently until month-endclosing, and maintain andprovide on-line queries andreports on balances separatelyfor the current and priormonths? At a minimum,balances must be maintainedon-line for both the current andprior months until prior monthclosing.

40. Does the system, at year’s end,post to the current year bymonth, as well as to the prioryear, regardless of when year-end closing occurs? Forexample, a user should be ableto post to the previous fiscalyear while also postingtransactions to the current year.Balances must be maintainedand accessible through on-linequeries for both the current andprior fiscal years until year-endclosing.

41. Does the system provide controlover the correction andreprocessing of all erroneoustransactions through the use oferror file(s) and/or suspenseaccounts? Erroneoustransactions must bemaintained and tracked untileither corrected and posted ordeleted at the specific request ofan authorized user.

42. Does the system providestandard record format(s) forinterface of transactions fromother systems to the corefinancial system and subject alltransactions from interfacingsystems to the core financial

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management function

Yes/no/

na Explanation

system edits, validations, anderror correction procedures?Erroneous transactions must bemaintained and tracked untileither corrected and posted ordeleted by an authorized user.

43. Does the system support bothbatch and real-time on-line dataentry and use the same edit andupdate rules as appropriate foreach mode?

44. Does the system supportsimultaneous data entry/accessby multiple users in a variety ofaccess modes?

45. Does the system supportmanagement controls to ensurethat transactions are processedin accordance with governmentand agency-prescribedstandards and procedures, theintegrity of data in the system ismaintained, and access isrestricted to authorized users?

46. Does the system providetransaction edits that control, ata minimum, fund availability,account structure, and tolerancelevels between relatedtransactions, such as betweenan obligation and its relatedaccrual?

47. Does the system providecontrols to prevent the creationof duplicate transactions?

48. Do the system’s user entry andquery screens supportvalidation of codes entered onthe screen and assist users in

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management function

Yes/no/

na Explanation

determining correct codes if aninvalid code is entered?

49. Does the system provide forinquiry by the user to verifyvalid codes during the dataentry process?

50. Does the system provide thecapability to enter and store forfuture processing anytransactions in the currentmonth for processing thesubsequent month?

51. Does the system provide theability to process intra-governmental transactions andtrack intragovernmentalbalances related to other federalagencies?

Archiving and purging process

52. Does the system archivetransactions and relatedinformation needed for audittrails in a format accessible byaudit software?

53. Does the system allow closeddocuments to be reopened atthe document control level withall associated transactionhistory? Prior month’s controltotals and balances will not beaffected by a reopeneddocument.

54. Does the system provide theauthorized system administratorthe flexibility to determinewhether records are to bearchived or purged? For thosedocuments that meet the

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management function

Yes/no/

na Explanation

criteria, the system must allowselective action. The systemmust include the capability toestablish and maintain user-defined archival criteria.

55. Does the system retain systemrecords in accordance withfederal regulations establishedby the National Archives andRecords Administration(NARA), GAO, and others?

56. Does the system prevent thepurging of transactions prior tothe proper period?

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General ledger management

function

Yes/no/

na Explanation

General ledger posting process

1. Does the system posttransactions to SGL inaccordance with the transactiondefinitions established by thecore financial systemmanagement function?

2. Does the system maintainhistorical data to producecomparative financial reportsfor management use?

Accruals, closing, and

consolidation process

3. Does the system provide forautomated month-and year-endclosing of SGL accounts androllover of SGL accountbalances (note that this includessub-accounts)?

4. Does the system allow selectedtransactions (i.e., adjustments)to be processed?

5. Does the system provide thecapability for multiplepreliminary year-end closingsbefore final year-end closingwhile maintaining the capabilityto post current period data?Posting of current period datawill not be affected by thisprocess.

6. Does the system automaticallygenerate selected recurringaccrual entries and reversals inthe next fiscal period?

7. Does the system allow for

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function

Yes/no/

na Explanation

accruals of contracts or otheritems that cross fiscal years?

8. Does the system selectivelygenerate required transactionsas needed by the year-endclosing procedures?

9. Does the system separatelyidentify amounts that would beeliminated when preparingintra-agency and interagencyconsolidations?

10. Does the system prepare trialbalances and other supportinginformation needed for externalreports and financialstatements, includingconsolidated statements?

11. Does the system supportmultiple pre-final closings toaccommodate incrementaladjustments and closing?

12. Does the system provide for ayear-end rollover of appropriatesystem tables into the new fiscalyear, under the control of anauthorized systemadministrator?

13. Does the system provide thecapability to process, track, andcontrol prior fiscal yearadjustment transactions?

General ledger analysis and

reconciliation process

14. Does the system report acomparison between amountsin other components of the corefinancial system and the related

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function

Yes/no/

na Explanation

control accounts in the SGL andannotate out-of-balanceaccounts on the report?

15. Does the system provide controlaccounts in the general ledgerto balance between the generalledger and other systems, suchas property and travelmanagement?

16. Does the system provide thecapability for authorized usersto correct out-of-balanceconditions discovered duringthe reconciliation process?

17. Does the system maintain anaudit trail of any suchcorrections?

18. Does the system provide forreconciliation of all openaccounting period (prior month,current month, prior fiscal year,and current fiscal year)balances to their respectivesubsidiaries through on-linequeries and reports?

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Funds management function

Yes/no

na Explanation

Budget execution process

1. Does the system provide theability to track changes tobudget authority at multiplelevels of distribution?

2. Does the system provide thecapability to track actualamounts (e.g., commitmentsand obligations) against theoriginal and revised budgetedamounts consistent with eachfinancial planning level?

3. Does the system provideflexibility in establishing andmodifying funding distributionand spending levels at multipleorganizational levels?

4. Does the system allowauthorized personnel toreallocate funds at designatedlevels?

5. Does the system provide theability to manage and controlprior year funds in the currentyear, including the capability toidentify prior year and currentyear de-obligations separately?

6. Does the system supporttolerance levels that are user-defined and established andmaintained in tables controlledby authorized personnel? Thetolerance levels should bemaintained in terms ofpercentages of the total with anot-to-exceed dollar threshold.

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Yes/no

na Explanation

Funds allocation process

7. Does the system record fundingand related budget executiondocuments?

8. Does the system recordlimitations and control the useof funds against them consistentwith appropriation andauthorization language, andadministrative limitationsestablished by agencymanagement?

9. Does the system distribute,track, control, and report fundsauthorized at various fundinglevels based on SGL, accountingclassification structure, andproject structure?

10. Does the system allowmodification of limitations inaccordance with apportionmentactions, reprogramming,rescissions, and otheradjustments?

11. Does the system record andcontrol funds that receive otherbudget authority in addition toappropriations and identify thetype of authority?

12. Does the system record theexpiration and cancellation ofthe appropriation in accordancewith laws and regulations,including OMB Circular A-34and the SGL?

13. Does the system maintainoperating plans at or below the

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Yes/no

na Explanation

funds control level of theclassification structure?

14. Does the system allowauthorized personnel toreallocate funds at designatedlevels?

15. Does the system account forbudgetary resources at a lowerlevel in the accountingclassification structure thanthey are budgeted?

Funds control process – funds

availability editing

16. Does the system provide for on-line notification of fundsavailability prior to thedistribution of lower levelfunding and the processing ofcommitment, obligation, orexpenditure transactions?

17. Does the system support thetimely recording oftransactions?

18. Does the system checkcommitment transactionsagainst available funds?

19. Does the system includeadequate controls to prevent therecording of commitments thatexceed available balances?

20. Does the system supportrecording obligations orexpenditures that exceedavailable balances and producea report or otherwise provide amethod that allowsmanagement to review the

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Yes/no

na Explanation

cause of this overobligationcondition?

21. Does the system provide fordesignated authorities toestablish and modify the level offund control using elements ofthe classification structure,including object class, program,organization, project, and fund?

22. Does the system provide fordesignated authorities toestablish and modify thesystem’s response (either rejecttransaction or provide warning)to the failure of a funds-availability edit for eachtransaction type?

23. Does the system provide thecapabilities and controls forauthorized users to overridefunds-availability edits?

24. Does the system record thefinancial impact of alltransactions that affect theavailability of funds, such ascommitments, liquidations,obligations, and expenditures?

25. Does the system provideautomatic real-time notificationto users of transactions failingthe funds-availability edit andplace the rejected transactionsin an error file and/or suspenseaccount for corrective action?In cases where the actual eventhas already occurred (such aslabor hours worked or acontract already signed), thetransaction should be recordedand a warning or report issued

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Yes/no

na Explanation

to alert the user to the need forfollow-up action.

26. Does the system update allappropriate accounts to ensurethat the system alwaysmaintains and reports thecurrent status of funds for allopen accounting periods?

27. Does the system determinefunds availability onadjustments to obligations orexpenditures based on whetherthe funds cited are current,expired, or cancelled?

28. Does the system check availablefunds for obligating documents(including amendments toobligating documents resultingin a change to dollar amounts orto the classification structure)?

29. Does the system check availablefunds when the expenditureexceeds the obligatingdocument due to quantity orprice variances withintolerances, additional shippingcharges, etc.?

30. Does the system adjust availablefund balances as reimbursableorders are accepted? In thecase of reimbursable ordersfrom the public, an advancemust also be received beforeadditional funding authority isrecorded.

31. Does the system check availablefunds for commitments andobligations incurred in supportof reimbursable agreements?

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Yes/no

na Explanation

Funds control process –

commitments

32. Does the system allowcommitment documents to beentered into the core financialsystem on-line and frommultiple locations, as well asthrough interfaces with othersystems?

33. Does the system maintaininformation related to eachcommitment document,including amendments? At aminimum, the system mustcapture requisition number,accounting classificationstructures, and estimatedamounts.

34. Does the system provide formodifications to commitmentdocuments, including ones thatchange the dollar amount or theaccounting classificationstructure cited?

35. Does the system invoke fundsavailability editing for thechanged amounts?

36. Does the system allow forcommitment documents to befuture dated, stored, and postedat the appropriate date?

37. Does the system subject thesedocuments to edit andvalidation procedures prior toposting?

38. Does the system closecommitment documents underthe following circumstances:

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Yes/no

na Explanation

(1) by the system upon issuanceof an obligating document, (2)by an authorized user, and (3)as part of the year-end closing ifthe commitment is in an annualappropriation or in the last yearof a multiyear appropriation?

39. Does the system provide thecapability to supportcommitment accounting basedon agency needs?

Funds control process –

obligations

40. Does the system recordobligations based on obligatingdocuments and liquidate, at theuser’s request, the relatedcommitments, either partially orfully?

41. Does the system recordobligations for which there is norelated commitment?

42. Does the system maintaininformation related to eachobligation document, includingamendments? At a minimum,the core financial system mustcapture obligating documentnumber and type; vendornumber and other identification,including vendor identificationnumber (ID), social securitynumber (SSN), taxpayeridentification number (TIN),employer identification (EIN),and data universal numberingsystem (DUNS); accountingclassification structures;referenced commitment (ifapplicable); and dollar amounts.

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Yes/no

na Explanation

43. Does the system allowobligation documents to beentered into the core financialsystem on-line and frommultiple locations, as well asthrough an interface with othersystems?

44. Does the system allowtransactions creatinganticipated obligationdocuments to be entered early,stored, and posted at theappropriate date?

45. Does the system subject thesedocuments to edit andvalidation procedures prior toposting?

46. Does the system permit the userto delete the transactionwithout posting it if theanticipated obligation does notoccur?

47. Does the system allow multiplecommitments to be combinedinto one obligating documentand one commitment documentto be split between multipleobligating documents?

48. Does the system allowauthorized modifications andcancellations of postedobligating documents?

49. Does the system provide on-lineaccess to all obligations byselection criteria, e.g.,document number?

50. Does the system maintain an on-line history file of closed-out

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Yes/no

na Explanation

documents for a user-definedperiod of time?

51. Does the system retain (foraudit purposes) all systemrecord files along with allamendments?

52. Does the system closeobligating documents either(1) automatically uponcomplete performance/deliveryor (2) through an authorizeduser?

53. Does the system record variousintragovernmental acquisitiontransactions, such as GeneralServices Administration (GSA)Personal Property Center,reimbursable orders, andprinting from the GovernmentPrinting Office (GPO)?

54. Does the system record andmaintain contracts and grantsso that fiscal year-to-date andinception-to-date informationcan be presented?

55. Does the system record blanketpurchase agreements (BPA) andtrack, control, and monitorrecords of call?

56. Does the system track, control,and monitor delivery ordersagainst a contract limitation?

57. Does the system recordexpenditures related topayments made through use ofimprest funds, third-partydrafts, and government creditcards?

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Yes/no

na Explanation

58. Does the system recordexpenditures claimed againstadvance payments made, suchas travel advances, contractadvances, and grants?

Funds control process – analysis

59. Does the system maintaincurrent information oncommitments and obligationsaccording to the classificationstructure on a fund by fundbasis?

60. Does the system track the use offunds against operating orfinancial plans?

61. Does the system report plancompared to actual data at thelevel of the operating plans?

62. Does the system summarize,compare, and report theoperating plans to theappropriate level of fundscontrol?

63. Does the system producedetailed lists and summaryreports by the defined level offunds control for thosedocuments that representcommitments, undeliveredorders, and expenditures?

64. Does the system provide controlfeatures that ensure that theamounts reflected in the fundcontrol structure agree with theSGL account balances at theend of each update cycle?

65. Does the system maintain

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Yes/no

na Explanation

historical data on allcommitment, undelivered order,payable, and paymenttransactions?

66. Does the system maintain opendocuments to show the status ofcommitments, undeliveredorders, accruals, anddisbursements by document lineitem?

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Payment management function

Yes/no/

na Explanation

Payee information maintenance

process

1. Does the system maintain payeeinformation that includes datato support obligation, accountspayable, and disbursementprocesses?

2. Does the system supportpayments made to third partiesthat act as agents for the payee?

3. Does the system maintaininformation needed to supportInternal Revenue Service (IRS)1099 and W-2 reporting,including TIN and payee type(e.g., sole proprietorship,partnership, and corporation)?

4. Does the system maintain 1099information for the principalparty rather than the agent incases where a third party actingas agent receives the payment?

5. Does the system provide thecapability to identify payeeswho receive 1099s, including1099Cs?

6. Does the system allow multiplepayment addresses and/or bankinformation for a single payee?

7. Does the system provide asearch capability for payeeinformation?

8. Does the system produce payeelists based on agency-definedcriteria, e.g., payee name andnumber?

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Yes/no/

na Explanation

Payment warehousing process

9. Does the system warehouse andschedule payments inaccordance with applicableregulations, for example, OMBCircular A-125?

10. Does the system provide thecapability to capture, store, andprocess appropriate invoiceinformation, including: invoicenumber, invoice amount,obligating document references,vendor number, payee nameand address, discount terms,invoice amount, invoice date,and invoice receipt date inaccordance with Treasurystandards and as necessary tosatisfy requirements of thePrompt Payment Act?

11. Does the system record anaccrued liability upon receiptand acceptance of goods andservices and properly identifythem as capital asset, expense,prepaid expense, orconstruction?

12. Record invoices throughkeyboard entry by a user andthrough an electronic interfacewith vendors in an electroniccommerce arrangement?

13. Does the system accesspreviously entered informationand/or record additionalinformation necessary toautomatically determine the duedate and amount of vendorpayments in accordance withOMB Circular A-125, based on

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Yes/no/

na Explanation

invoices, receiving reports, andcontracts or purchase orders?Due date determination shouldtake into account specialsituations, such as contractprovisions specifyingnonstandard acceptanceperiods; laws specifyingpayment terms for certaincommodities, such as meat ordairy products; failure to returna defective invoice promptly;and others specified in OMBCircular A-125.

14. Does the system provide thecapability of splitting an invoiceinto multiple payments on theappropriate due dates whenitems on the invoice havedifferent due dates?

15. Does the system recorddiscount terms andautomatically determinewhether taking the discount iseconomically justified asdefined in the TreasuryFinancial Manual, Volume I,section 6-8040?

16. Does the system recordadditional shipping and othercharges to adjust the paymentamount, if they are authorized?

17. Does the system adjust the assetor expense recorded with theliability if the authorizedpayment (based on the invoice)is different from the amountaccrued (based upon receiptand acceptance) using contractinformation and any increase iswithin agency tolerances?

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Yes/no/

na Explanation

18. Does the system alsoautomatically adjust theobligation amount and edit forfunds availability to coverincreases?

19. Does the system automaticallyupdate the funds control andbudget execution balances toreflect changes in the status ofundelivered orders andexpended appropriations, aswell as changes in amounts?

20. Does the system establishpayables and make payments onbehalf of another agency, citingthe other agency’s fundinginformation?

21. Does the system allowobligating documents to bereopened by authorized staffafter final payment has beenmade?

22. Does the system allow changesto payment schedules byauthorized staff prior tosubmission to the disbursingoffice?

23. Does the system process creditmemoranda for returned goodsor other adjustments?

24. Does the system apply thecredit to the specific obligationthat resulted in the credit,reducing the expense attributedto that obligation?

25. Does the system maintain thebalance of the credit forapplication against a future

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Yes/no/

na Explanation

payment if a credit is not fullyliquidated by one payment?

26. Does the system create theappropriate notice to the vendorthat a credit has been applied tothe affected payment?

27. Does the system reestablishpayables for voided checks orchecks or Electronic FundsTransfers (EFT) that have beenreturned but have not beennegotiated, and allow forreversing the accountingtransaction leading to thedisbursement and reestablishinga payable, as appropriate?

28. Does the system recordobligations, expenses, assets,etc., associated with paymentsmade through use of imprestfunds, third party drafts, andgovernment credit cards?

29. Does the system establishpayables to replenish theimprest fund or pay thefinancial institution handling thethird party drafts and creditcards?

30. Does the system schedulepayments of advances, prepaidexpenses, loans, grants, etc.,with the appropriate accountingentries for each?

31. Does the system recordexpenses, assets, etc., basedupon performance funded byadvances, prepaid expenses,and grants and make theappropriate liquidations?

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Yes/no/

na Explanation

32. Does the system automaticallyupdate funds control balancesto reflect obligation changes?

33. Does the system provide thecapability to support capture,storage, and processing ofinvoices received in electronicformat through an electroniccommerce arrangement or fromanother system?

34. Does the system allow forcompliance at the data level,with existing Treasurystandards dictating format andlength for certain invoice fields?

35. Does the system adjust theobligation based on finalinvoice/payment tolerancepercentage and amountauthorized, provided theamount is within the fundslimitations and checks?

Payment execution process

36. Does the system automaticallyidentify and select payments tobe disbursed in a particularpayment cycle based on theirdue dates?

37. Does the system provide afunction for review andcertification by an authorizedcertifying officer?

38. Does the system allow specificpayments selected fordisbursement to be excludedfrom the payment cycle andheld for later payment?

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Yes/no/

na Explanation

39. Does the system automaticallycompute amounts to bedisbursed, including discounts,withholdings, interest, orpenalties, in accordance withapplicable regulations?

40. Does the system generate theappropriate transactions toreflect the above deductionsand additions?

41. Does the system automaticallyinclude on each paymentrelevant identificationinformation (e.g., invoicenumber, obligating documentnumber, and interest penaltyamount and calculations)?

42. Does the system collectinformation on discounts taken,discounts lost, and interestpenalties to comply with currentapplicable prompt paymentinformation trackingrequirements?

43. Does the system calculate totalsby appropriation symbol forinclusion on the paymentschedule, except unidentifiedappropriations?

44. Does the system provide forvarious forms of payment to beused, i.e., check or electronicfunds transfer (e.g., AutomatedClearing House (ACH), wire)?

45. Does the system provide thecapability to capture, store, andprocess information related tosupporting the creation/generation of EFT payments

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Yes/no/

na Explanation

(ACH or wire) in accordancewith Treasury standards,including American BankingAssociation (ABA) routingnumber, recipient bank accountnumber, and account type?

46. Does the system supportTreasury-specific standards forformat of check and EFTpayment requests?

47. Does the system allow forconsolidation of multiplepayments to a single payee, upto the Treasury FinancialManual (TFM)-prescribedlimitation in order for thedisbursing office to produce onecheck or EFT and itemize allpayments covered by the onecheck or EFT?

48. Does the system allow forseparate checks to a payee inspecific instances whereneeded?

49. Does the system allow apayment request to be removedfrom the automated schedulingstream and to be scheduled as amanual payment by anauthorized official?

50. Does the system provide thecapability to schedule and makepayments in various forms (e.g.,ACH, SF-1166) as required by anagency’s disbursing offices,including physical media (e.g.,tape, electronic transfer)?

51. Does the system prepare reportsto Treasury on disbursements

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Yes/no/

na Explanation

made by an agency with its owndisbursing authority?

52. Does the system processtransactions resulting frompayments made using othersystems, such as payroll?

53. Does the system recorddisbursements, assets,expenses, obligations, or otheraccounts as appropriate, butdoes not schedule a paymentthrough the core financialsystem if the payment hasalready been made by the othersystem?

54. Does the system support thereceipt of bills from otherfederal agencies, and theirpayment through centralelectronic systems?

55. Does the system recordpayments made by anotherentity, such as a finance center,on behalf of the agency usingagency funds?

56. Does the system allow forcancellation of an entirepayment schedule or a singlepayment within a paymentschedule after payments arescheduled and prior to actualdisbursement by Treasury?

57. Does the system flag paymenttransactions that will disburse afund into a negative cashposition? Reimbursable workcan result in this type oftransaction with appropriateauthority.

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Yes/no/

na Explanation

Payment confirmation and

follow-up process

58. Does the system provideinformation about eachpayment to reflect the stage ofthe scheduling process that thepayment has reached and thedate each step was reached forthe following processing steps:

• payment scheduled• schedule sent to appropriate

disbursing office• payment issued by

appropriate disbursingoffice?

59. Does the system provide for thecomparison of the agency’spayment schedule anddisbursing office’saccomplished paymentschedule?

60. Does the system updatepayment information whenconfirmation is received fromthe disbursing office, includingthe paid schedule number,check numbers or tracenumbers, and date, amount ofpayment, and payment method(check or EFT)?

61. Does the system maintain ahistory of every payment by thecore financial system, includingauthorizing document number,payment schedule number,payment date, invoice number,vendor number, vendor name,payment address, appropriationcharged, and prompt paymentinformation?

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Yes/no/

na Explanation

62. Does the system provide on-lineaccess to vendor and paymentinformation?

63. Does the system provide on-lineaccess to open documentsbased on agency selectioncriteria, e.g., document number?

64. Does the system produce IRS1099s in IRS acceptable form(hard copy or magnetic tape)?

65. Does the system produce theSF-224, Statement ofTransactions?

66. Does the system producesupporting information neededto prepare the prompt paymentreport in accordance withrequirements in OMB CircularA-125?

67. Does the system automaticallyliquidate the related liability orthe in-transit amount whenpayment confirmation updatesthe system?

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Receipt management function

Yes/no/

na Explanation

Receivable establishment

process

1. Does the system support thecalculation, generation, andposting of customer bills basedupon billing source, eventand/or time period, and type ofclaim in accordance withagency program requirements?Bases used for billing mayinclude:

• percentage of reimbursableobligations, accruedexpenditures, or costs, usingdata recorded by the costaccumulation function;

• fee schedules for goods orservices provided;

• duplicate payments;• erroneous payments; and• payment schedules or other

agreements with otherentities.

2. Does the system record theestablishment of receivablesalong with the correspondingrevenues, expenditurereductions, or other offsets?

3. Does the system support theestablishment and tracking ofreceivables to be paid underinstallment plans, includingplans for which payments havebeen rescheduled?

4. Does the system print bills,accommodating the generationof standard forms, such as SF-1080s or SF-1081s, andturnaround documents to be

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Yes/no/

na Explanation

used as a remittance advice?

5. Does the system allowcustomized text in generatedbilling documents?

6. Does the system support billsand collections between federalagencies through the use of anelectronic system, includingrecording collections andpayments between agencieswith supporting documentation?

7. Does the system allowtransactions related to manuallyprepared bills to be entered byauthorized personnel?

8. Does the system recordadjustments to bills and postthem to customer accounts?

9. Does the system date the billswith the system-generated dateor with the date supplied by anauthorized user?

10. Does the system printstatements as well as bills?

11. Does the system accepttransactions that generatereceivables from other systemsin a standard format for entryinto the core financial system?

Receivable management process

12. Does the system maintaindetailed information by account(e.g., individual, employee,private sector organization,state or local government, orother federal agency) sufficient

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Yes/no/

na Explanation

to provide audit trails and tosupport billing and researchactivities?

13. Does the system maintainaccounts for reimbursableorders and identify governmentand nongovernment accounts?

14. Does the system update eachaccount when billing documentsare generated and collectionsare received?

15. Does the system allowauthorized personnel to add,modify, or delete nonfinancialaccount data?

16. Does the system maintain dataon individual receivables andreferenced transactionssupporting the receivables?

17. Does the system provide on-linequery capability to receivableand account information?

18. Does the system provideinformation, on a summarybasis and on individualreceivables, on the age ofreceivables to allow formanagement and prioritizationof collection activities?

19. Does the system provideautomatic calculation andassessment of interest,administrative charges, andpenalty charges on overduereceivables?

20. Does the system allow for thewaiver of the above charges

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Yes/no/

na Explanation

with appropriate authority?

21. Does the system identify andreport receivables that meetpredetermined criteria for baddebt provisions or write-off?

22. Does the system maintain datafor receivables referred to otherfederal agencies and/or outsideorganizations for collections?

23. Does the system record thewrite-off of delinquent oruncollectible receivables(including interest, penaltiesand administrative charges) andmaintain data to monitor closedaccounts?

24. Does the system producedunning (collection) letters foroverdue receivables inaccordance with Treasuryrequirements and existinglegislation?

25. Does the system provideauthorized users with the abilityto customize the dunningprocess parameters anddunning letter text?

26. Does the system provideinformation to allow eithermanual or automated reportingof delinquent accounts tocommercial credit bureaus andreferral to collection agencies orother appropriate governmentalorganizations?

27. Does the system maintaininformation needed to supportIRS 1099Cs in the amounts of

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Yes/no/

na Explanation

debts forgiven?

28. Does the system maintain ahistory of billings and receiptsfor each receivable and accountin accordance with agencyrequirements?

29. Does the system match receiptsto the appropriate receivablesand update system balances?

30. Does the system provide theability to apply receipts to morethan one receivable?

31. Does the system updatereceivable balances documentby document, classifying andposting against principal,interest, fees, etc., as requiredby OMB Circular A-129,Managing Federal CreditProgram?

32. Does the system identifyreceivables that have beenreduced by some means otherthan cash collections, such aswaivers or write-offs?

33. Does the system provide forreestablishment of a receivablefor checks returned due toinsufficient funds?

34. Does the system provide theability to uniquely record,classify, and report the status ofreimbursable funds receivedand used by customers and, inaddition, does this informationagree with the standard accountstructure?

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Yes/no/

na Explanation

Collection process

35. Does the system recordcomplete and partial receipts?

36. Does the system recordrevenues, expenditurereductions, or other appropriateoffsets associated withcollections for which noreceivable was previouslyestablished?

37. Does the system record depositsand related debit vouchers forreconciliation to depositconfirmation informationprovided by Treasury or thebanking system?

38. Does the system provide for theprocessing of cash or creditcard receipts againstoutstanding receivables?

39. Does the system allow for offsetof funds due to delinquentindebtedness throughadministrative offset, federalemployee salary offset, andincome tax refund offset?

Offsets

40. Does the system provide theability to capture TIN data forthe debtor and report overduereceivables with associated TINdata to Treasury for possibleoffset?

41. Does the system comply withrequirements of the InternalRevenue Service Tax Refund

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Yes/no/

na Explanation

Offset Program and TreasuryOffset Program requirements?

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Cost management function

Yes/no/

na Explanation

Cost recognition process

1. Does the system provide theability to post accruals torecognize costs? The cost ofgoods and services used,consumed, given away, lost, ordestroyed must be recognizedwithin the period of time theevent occurred, regardless ofwhen ordered, received, or paidfor. Similarly, revenues must berecognized when earned.

2. Does the system reduce assetbalances, such as inventoriesand prepaid expenses, as theassets are used and expended?

3. Does the system use theagency’s accountingclassification structure toidentify information, such asfund, program, organization,project, activity, and cost centerto support the costaccumulation and assignmentprocesses?

4. Does the system supportmanagerial cost accounting byproviding the capability tomeasure and report the costs ofeach segment’s outputs?

Cost accumulation process

5. Does the system capture fees,royalties, rents, and othercharges imposed by the agencyfor services and things of valueit provides? These costs shouldbe captured at the lowest levelto reflect related actual costs

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Yes/no/

na Explanation

incurred by the agency inproviding goods and services.

6. Does the system identify allcosts incurred by the agency insupport of activities of revolvingfunds, trust funds, orcommercial functions, includingthe applicable portions of therelated salaries and expenseaccounts identified with thoseactivities?

7. Does the system provide for avariety of information tosupport the managerial costaccounting decision-makingprocess, the management of theagency, and external reporting?This will include

• cost reports to be used inthe analysis ofprogrammatic activities,

• schedules and operatingstatements in support offinancial statementpreparation and audit,

• meaningful cost informationneeded to supportperformance measures,

• ability to transfer costinformation directly to andfrom other systems,

• cost information forcomparison to otherprogram data to determinecompliance with plannedbudgeted activities, and

• support of the billingprocess by providing costinformation to thereceivable function forproducing bills.

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Yes/no/

na Explanation

Cost distribution process

8. Does the system provide foridentifying costs based on theaccounting classificationstructure?

9. Does the system identify andrecord direct costs incurred,including input on costs fromfeeder systems, such asinventory, travel, or payroll?

10. Does the system assign indirectcosts to interim and final costobjects using a methodconsistent with agency costaccounting standards? Indirectcosts will be assigned on a basisthat best provides for a causal/beneficial relationship betweenthe costs being distributed andthe cost object receiving thecost. Indirect cost assignmentmay be based on total costincurred, direct labor hoursused, square footage, meteredusage, or any other reasonablebasis.

11. Does the system allow formultilevel assignment andreassignment?

12. Does the system support the useof historical data to conductvariance analysis, adjustment ofrates, and disposition ofvariance by performing periodicassignments to adjust costbased on estimated rates to theactual costs incurred for theperiod?

13. Does the system assign costs to

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Yes/no/

na Explanation

entities or cost centersregardless of how they haveoriginally been posted to thesystem (e.g., for financialstatement presentation)?

14. Does the system provide anaudit trail that traces thetransaction from the originalcost pool to the final costobject?

Revolving fund process

15. Does the system provide thecapability to support the use ofrevolving funds for workingcapital programs?

16. Does the system provide thecapability to create and trackservice-level agreements forcustomer projects, including theproject or reimbursableagreement number, the clientorganization, and fundingcitation?

17. Does the system provide theability to link orders andexpenses directly to a service -level agreement if appropriate?

18. Does the system provide thecapability to verify fundavailability for service ordersdirectly attributable to aparticular customer of therevolving fund operation?

19. Does the system provide thecapability to support funding tothe revolving fund through theuse of advances or throughreimbursement?

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Yes/no/

na Explanation

20. Does the system supportassignment of costs incurred bythe revolving fund through oneof the following methods: directassignment or indirectassignment?

21. Does the system provide thecapability to establish/usemultiple assignment methods,such as fixed fee, squarefootage, full-time equivalent(FTE)?

22. Does the system provide thecapability to generate summarystatements by revolving fundcustomer and/or project?

23. Does the system provide theability to bill customers basedon appropriate fee structures?

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Reporting function

Yes/no/

na Explanation

Access to information process

1. Does the system allow for theinformation contained in thesystem to be queried to presentspecific detailed data asrequested? This will includeuser-defined criteria to accessdata for open or closedaccounting periods.

2. Does the system presentinformation resulting fromsystem queries formatted tofacilitate the understanding ofthe information by non-technical users, andunformatted for moretechnically proficient users?

3. Does the system provide for theproduction of formattedreports? The system must allowfor the reformatting of reportsto present different sorts of theinformation, the presentation ofonly specific information in theformat selected, thesummarization of data, and themodification of report formatsto tailor the reports to thespecific requirements of theuser.

4. Does the system allow users todesign reports and extract filesfor their specific requirementsand to perform table look-upsand expansion of codes whenneeded to clarify theinformation contained withinthe reports?

5. Does the system facilitate the

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Reporting function

Yes/no/

na Explanation

analysis of informationcontained in the system byallowing analysts to obtainreport information and theresults of system queries in datafiles that can be transferred toother applications or analyticaltools?

6. Does the system provide foreasy access to historical files forcomparative, analytical, andtrend information?

7. Does the system have availablethe capability to perform a“Print Screen” on all userscreens?

Financial reporting process

8. Does the system use financialdata that can be traced directlyto SGL accounts to producereports providing financialinformation, whether usedinternally or externally?

9. Does the system maintainaccounting data to permitreporting in accordance withfederal financial accountingstandards issued by theComptroller General and theDirector of OMB, and withreporting requirements issuedby the Director of OMB and theSecretary of the Treasury(Appendix C)?

10. Does the system providesummarized data electronicallyto systems used by the agencyfor decision support andprovide for the preparation of

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Reporting function

Yes/no/

na Explanation

financial statements from theSGL and by “line of business?”

11. Does the system provide data inthe format required, includingelectronic formats, to centralagency systems used forsummary financial reporting(e.g., FACTS, SF224, SF1219, SF1220, SF133)?

12. Does the system report eventsand transactions according tothe accounting classificationstructure and within a givenaccounting period?

13. Does the system maintain thefinancial information requiredfor program performance,financial performance, andfinancial managementperformance measures neededfor budgeting, programmanagement, and financialstatement presentation?

14. Does the system produce,distribute, and provide access toformatted reports defined byagency management for thespecific requirements of theagency?

15. Does the system use the SGLmandated chart of accounts asthe basis for preparing externalreports or data transmissions toOMB and Treasury?

16. Does the system provide thecapability to electronicallytransmit the following reports toTreasury: SF133, credit reports,year-end closing statements,

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Reporting function

Yes/no/

na Explanation

and quarterly and annualFACTSI and FACTSII reports?

17. Does the system provide theability to produce an on-linecurrent status of funds reportdown to the lowest level of theorganizational structure,including

• annual budget (includingrevisions),

• open commitments,• open obligations,• net payments/liquidated

obligations, and• balance available?

System monitoring process

18. Is the overall operation of thesystem monitored to determineif operations are on scheduleand all necessary operatingsteps have been completedsuccessfully, and can it alert thesystem manager to malfunctionson a timely basis?

19. Does the system provide systemmanagers with system statisticsto determine the functions andoperations performed byspecific users and reportsgenerated or accessed?

20. Does the system perform andreport the result of dataintegrity verifications, such asreconciliation between reportsproduced and data sets withinthe system, and the results ofvalidity, combination, andbalancing edits?

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Reporting function

Yes/no/

na Explanation

21. Does the system provide forsufficient audit trails to tracedata errors and the result ofvarious operations of thesystem?

(922281)

GAO CORE FINANCIAL SYSTEM REQUIREMENTS Checklist for Reviewing Systems Under the

Documents

Transcript of GAO CORE FINANCIAL SYSTEM REQUIREMENTS Checklist for Reviewing Systems Under the