Financial Management

Pursuant to a legislative requirement, GAO monitored the Forest Service's progress in improving the reliability of its accounting and financial data, focusing on corrective actions the Forest Service has taken as well as the key tasks it must still perform in order to ensure the reliability of its accounting and financial data.

GAO noted that: (1) the U.S Department of Agriculture (USDA) Inspector General's (IG) audit of the Forest Service's fiscal year (FY) 1995 financial statements found those statements to be unreliable due to serious deficiencies in accounting and financial data and systems; (2) the Forest Service goal is to demonstrate significant progress by correcting some of the deficiencies during FY 1997 and to achieve financial accountability by the end of FY 1999 as a result of this effort; (3) the Forest Service has prepared a good plan to correct its financial shortcomings and taken the initial steps in following through; (4) top management has created an environment to promote change and has challenged the staff to improve the agency's financial accounting and reporting; (5) knowledgeable staff have been involved at all levels in developing action plans, revising guidance, and implementing corrective measures; (6) financial management has been included as a critical element in performance standards for Senior Executive Service staff, and accountability has been established for certain tasks; (7) certain major tasks remain that could impede progress if they are not finished as planned, and significant improvement will not occur until these matters are addressed; (8) the Foundation Financial Information System (FFIS), which is the new accounting system that the Forest Service expects will eliminate many of the current financial shortcomings, has encountered delays; (9) however, during August 1997, the USDA Acting Chief Financial Officer said that he anticipates that all necessary system design, coding, testing, and certifying will be accomplished by October 1, 1997; (10) until the Forest Service completes an evaluation to identify financial management workload requirements at all levels, it cannot determine if current resources are sufficient to accomplish the remaining tasks; (11) the Forest Service continues to have certain accounting problems that could hamper its ability to produce reliable financial information and negatively impact future audit opinions; (12) the IG stated that issuance of interim directions and written guidance should facilitate improved accountability over these accounts; and (13) it is doubtful that the Forest Service can achieve financial accountability if management and staff commitment waiver, planned tasks are not accomplished, and sufficient resources are not provided.