HW
PLEASE USE THE RESOURCES THAT ARE LISTED BELOW
Answer the questions; to get full credit, MUST include the question and answer on a Word file.
First, familiarize yourself with the basic understanding of the three branches of Government and how they operate.
https://www.usa.gov/branches-of-government
You will need a functional understanding of the Branches, their roles and how they operate.
Next, by briefly browsing the web site presenting the Red Book for Principles of Federal Appropriations Law, observed by Federal Agencies, accessible at
http://www.gao.gov/legal/red-book/overview
Notice the references Generally Accepted Government Auditing Standards (GAGAS). For all Federal Agencies, the guide for audits and reporting on internal control is in the Yellow Book http://gao.gov/products/GAO-12-331G accessible as a pdf file at http://gao.gov/products/GAO-12-331G an electronic html version is available. Access the pod cast overview of the Yellow Book at http://www.gao.gov/multimedia/podcasts/656740 (transcript provided).
The Federal Government also presents Standard for Internal Control as the Green Book at
http://www.gao.gov/greenbook/overview
Review information about the Revised Federal Financial Management System Requirements for Fiscal Reporting by accessing the web pages at
https://tfm.fiscal.treasury.gov/v1/p6/c950.html
Review this web site as an overview of Bureau of the Fiscal Service of the U.S. Department of the Treasury, delivering central payment services to Federal Program Agencies, managing federal government’s collections and deposit systems, providing government-wide accounting and reporting services.
https://www.fiscal.treasury.gov/
Review this web site to learn more about the numerous applications that the Fiscal Service provides. This includes central accounting and financial reporting for government as a whole, debt collection, accounting systems, collections and other systems.
https://www.fiscal.treasury.gov/
Learn about the Current Statutory Framework for Federal Financial Reporting and Recent Legislation highlights specific Federal Agency issues and accomplishments related to Federal Financial Management as you access the web site
https://www.fas.org/sgp/crs/misc/R42975.pdf
The Chief Financial Officers Act of 199020 Years Later: Report to the Congress and the Comptroller General presents 33 pages explaining the CFO Act and Financial Management Systems for the Federal Government
https://www.ignet.gov/sites/default/files/files/cigiecforpt0711.pdf
HW #1
1. An agency has an appropriation for $500,000, and obligates for $550,000 citing the appropriation. Is the spending allowable? Why or why not?
2. An agency has a single year appropriation for Fiscal Year 2016, and obligates on December 29, 2016, citing the appropriation. Is this allowable? Why or why not?
3. Which branch of the government rules on the constitutionality of laws?
4. Is the Statement of Budgetary Resources unique for federal entities?
5. The Prompt Payment Act, which is in the U.S.C, an example of federal financial policy. T/F
6. The Statement of Changes in Net Position is unique for federal entities, and does not have a similar statement in the for-profit realm. T/F
7. Review and Audit is part of the federal budget cycle. T/F
8. Performing mission critical functions is part of the federal budget cycle (performing the work and not paying for the functions). T/F
9. The GAO rules on appropriation law is known as the Yellow Book. T/F
10. OMB allows agencies to Allot funds; an agency must receive approval from OMB to create an allotment. T/F
Federal Financial Management
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Agenda
Class Intro
Professor Introduction
Regulations
FASAB
Financial Statements
Other Items
Upcoming Assignments very important
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Class Intro
Student Bios Post to Week 1 Discussion
Please select an Agency to review
Syllabus
Available in LEO
Online participation is mandatory must have two posts (unless otherwise noted) each graded Discussion to get full credit
Questions – please post to Ask the Professor
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Class Intro – What We Will Cover During This Class
Overview of the Federal Government
Legislation and agency mandate
Federal accounting
Appropriation laws
Important laws governing federal financial practices
The Budget Cycle
OMB Circular A-123
Federal Oversight Agencies e.g., GAO
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Class Intro – Remembering Civics
A few things to note:
Remember checks and balances:
Each Branch of Government works to ensure it remains separate from the other two (e.g., judicial rulings about immigration rules) – Need to know three branches (see required readings and below)
Legislative makes laws; approves certain judges in judicial branch
Executive executes (carries) out the laws
Judicial rules on constitutionality of laws; includes Congress and other groups that support congress
Constitutionality questions still arise
Consider the separation of duties and how it might impact federal accounting
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Class Intro – Size of Government
US Federal Government spends trillions of dollars
Annualfederaloutlays account for approximately 25% of the country’s gross national product (not including Federal Reserve)
Includes several large cabinet level agencies
Department of Defense
Department of Homeland
Constitutionality questions still arise
Includes numerous other small agencies, such as United States Agency for Global Media, previously Broadcasting Board of Governors (runs Voice of America)
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Professor Introduction
UVA, BS Commerce, 1999
CPA, 1999; CGFM, 2008; CGMA, 2012
Auditor, Arthur Andersen, 1999-2001
MBA, University of Maryland, 2006
Financial Analyst, Federal Reserve, 2001-2003
Senior Consultant, CGI*, 2003-2009
Accountant/Team Lead, DHS/USCIS 2009-11
Senior Accountant, USAGM**, 2011-13
Systems Acct, DHS/Coast Guard***,
2013-14
Systems Acct/Project Manager, State Department, 2014 – present
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*worked on projects with Dep of State, GSA, EPA and did recruiting
**Was Broadcasting Board of Governors – federal entity that includes Voice of America; served as Contracting Officer Representative
***Civilian
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Prof Introduction Continued
Instructor for Becker CPA Review, 2003-present
Professor at UVA 2007-2009
Audit non-profits, 2006-present*
Professor at UMGC (was UMUC), 2009-present
Promoted to Adjunct Associate Professor Feb 2014
Published book on Business Ethics, 2015
*work with business partner to audit Homeowners Associations and non-profits
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Professor Introduction
Born and raised in Alexandria, VA
Married with a son
Coach Wrestling, 1999-present
Enjoys traveling
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Regulations
Very important to know about regulations
Employees and contractors should know about various accounting, contracting and other administration regulations
Regulations change often
Covered in Week 2 in more detail
Regulations – OMB / GAO
OMB: Circulars/Bulletins are rules, regulations, and directives providing details for to implement laws of Congress. OMB Circulars issued when the nature of the subject is to be of continuing effect and is to remain in force until rescinded or superseded. Circulars are identified by the letter “A” and a number (e.g., OMB Circular A-11,Preparation, Submission, and Execution of the Budget).
GAO: provides audits will assess and report on program performance related to afederaldepartment’s goals and objectives, and may consider such issues as the efficiency, economy, and effectiveness of operations; includes agencies that provide revenue (Customs of DHS, IRS). Also creates important regulations via Comptroller General rulings
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FederalAccounting StandardsAdvisory Board (FASAB)
Formed from U.S. Comptroller General (who heads the GAO), the Secretary of the Treasury, and the Director of the OMB
Provides rules and regulations for US federal government accounting
Currently (though not always historically) source of the GAAP for federal agencies AICPA ruled that FASAB is GAAP
Different from GASB, which is for state & local and FASB, for non-profit and for-profit
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FASAB (continued)
Creating guidance
Identify accounting issues and agenda decisions.
Conduct preliminary deliberations.
Prepare initial documents (e.g., issue papers, discussion memoranda).
Release documents to the public, hold public hearings, consider comments.
Hold further deliberations, publish exposure drafts, consider comments.
Obtain general consensus (at least a majority vote) of the FASAB members and submit final documents to the Comptroller General, the Secretary of the Treasury, and the Director of the OMB.
Create standards (SFFAS) often
Note that since August 2005 (SFFAS 30), FASAB has issued over 25 new standards
Statements – http://files.fasab.gov/pdffiles/handbook_contents.pdf
Also note – http://fasab.gov/accounting-standards/
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Financial Statements
Balance Sheet: present resources, liabilities, and the financial status of the entity at a specific point in time
Statement of Net Cost – present the various components of the net cost of a reporting entity’s operations (i.e., total, gross, or full costs less any exchange revenues
Focus on costs of programs, usually in high-level categories
Statement ofChanges in Net Positionreports the beginning net financial position, the items that caused changes in the net position, and the ending net position of afederal entity
Note all three similar to for-profit entities (e.g., Net Cost = Income Statement; Changes in Net Position = Shareholders Equity; Balance Sheet = Balance Sheet)
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Financial Statements – Continued
Statement ofBudgetary Resourcesprovides information on the status of congressional spending authority by those entities whose financing derives, wholly or in part, from congressional budget and spending authority this is a statement that for-profit entities do not use
Statement ofCustodial Activityis used to record custodial revenue collected by afederalagency which is not considered revenue to the entity. Collections on behalf of other funds (e.g., trust funds, etc.). this is a statement that for-profit entities do not use
Audio file and the A-136 (see later slide) list other statements
Called Form and Content of Financial Statements
More details at A-136
Note the above does not list all statements, and some statements have been added/deleted in past few decades (lecture has more details)
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Financial Statements – Continued
Statement of Social Insuranceprovides information on various long-term programs that provide benefits to citizens, including Medicare Old-Age, Survivors, and Disability Insurance (OASDI or Social Security); Hospital Insurance (HI) and Supplementary Medical Insurance (SMI), collectively known as Medicare source is A-136 at https://www.whitehouse.gov/wp-content/uploads/2019/06/OMB-Circular-A-136.pdf
Some statements have been removed as standard external reports, such as the Statement of Financing (no longer required)
A-136 lists the Form and Content of Financial Statements
Note the slides in this slide deck does not list all statements, and some statements have been added/deleted in past few decades
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Other – General Legislation Important to Federal Financial Management
CFO Act of 1990
A very good analysis of the CFO Act
Source: http://www.gao.gov/special.pubs/af12194.pdf
Government Performance and Results Act
http://govinfo.library.unt.edu/npr/library/misc/s20.html
Recently revised will include more information in book
Anti-Deficiency Act
http://www.gao.gov/legal/lawresources/antideficiencybackground.html
Very important for agencies ADA violation could drastically damage ones career
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Other Acts
At a minimum, all appropriations and budget authorities have three specific compliance considerations:
Supplemental Appropriation Act of 1954
no amount shall be recorded as an obligation of the government unless it is supported by one of the prescribed forms of documentary evidence.
Every entity must report, at year-end, unliquidated obligations and its remaining unobligated appropriation balances
Other notes: http://www.gpo.gov/fdsys/pkg/STATUTE-67/pdf/STATUTE-67-Pg418.pdf
https://www.law.cornell.edu/uscode/text/31/1501
Congressional Budget and Impoundment Act of 1974
Established CBO to perform research on the budget
established Committees on the Budget in each house of Congress to force the many committees of Congress to coordinate and agree
mandated a new fiscal year of the federal government, changing it from July 1 of each year to October 1
Federal Financial Management Improvement Act of 1996
Requiring that systems requirements, accounting standards, and the Standard General Ledger were to be implemented “at the transaction-level.”
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Other Acts
Federal Financial Management Improvement Act of 1996
Requiring that systems requirements, accounting standards, and the Standard General Ledger were to be implemented “at the transaction-level.”
Requiring federal departments and agencies to implement financial management systems that comply with federal requirements, applicable accounting standards, and the government’s Standard General Ledger.
Directing the GAO to make, every year (starting) by October 1, 1998, a report concerning whether the financial statements of the federal government have been prepared in accordance with applicable accounting standards and the adequacy of uniform accounting standards for the federal government.
The Accountability of Tax Dollars Act of 2002
Requires that all but the smallest of executive agencies (generally executive agencies with $25 million or less in budget authority) issue annual audited financial statements.
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Creating an Agency
Perceived Need
Enabling Legislation
Defining Role and Scope
Defining Structure
Do not be surprised: agency roles may crossover
Look at two agencies that matter to accountants:
SEC http://www.sec.gov/about/whatwedo.shtml#create
IRS https://www.irs.gov/about-irs
Look at the legislation and then look at their structures. The Legislation may not always dictate the organizations structure
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Required cabinet level agencies to create financial reports similar to publicly traded companies
Increased requirements on financial reporting previously, federal agencies had often focused on budget reports
Requires CFO that has proper knowledge
In one defense entity, CFO is an admiral
In a smaller agency, CFO was a career federal employee
Other- CFO and the PAR
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Upcoming Assignment Information
Please select an Agency to review by Week 1
See next slide for an example of agencies
Complete Discussions for Week 1 Due on Aug 25, 2020
For full credit, need at least two posts for each graded discussion (unless otherwise noted)
Posts must be at least three full sentences
Complete Discussions for Week 2 Due on Sept 1, 2020
Complete Homework #1, covering Weeks 1-2 (very helpful for exam) Due on Sept 1, 2020
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Agencies in US Government*
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*Broadcasting Board of Governors changed name to US Agency for Global Media Acct 350 Class 1 Enhanced
2019
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