Tax Systems Modernization

Blueprint Is a Good Start But Not Yet Sufficiently Complete to Build or Acquire Systems Gao ID: AIMD/GGD-98-54 February 24, 1998

This report assesses the modernization blueprint that the Internal Revenue Service (IRS) prepared according to a congressional conference report that directed IRS to develop a plan that would define, direct, and control future modernization efforts. In May 1997, IRS presented Congress with a modernization blueprint consisting of a systems life cycle, business requirements, functional and technical architectures, and a sequencing plan. GAO discusses whether (1) IRS' systems life cycle was complete and consistent with best industry and government practices; (2) the business requirements were precise enough and the functional and technical architectures were complete enough to build or acquire systems, and the sequencing plan was complete enough to understand the transition to the target systems environment; (3) IRS' business requirements, functional and technical architectures, and sequencing plan had been validated by using defined and implemented systems life cycle processes; and (4) the information technology management structure was conducive to effective implementation and enforcement of the blueprint.

GAO noted that: (1) IRS' May 15, 1997, modernization blueprint is a good first step and provides a solid foundation from which to determine precise business requirements, a complete target architecture, and a discipline set of processes and detailed plans for validating, implementing, and enforcing the architecture; (2) similarly, the blueprint's business requirements specify needed improvements in such areas as financial management, and the architecture and sequencing plan include several positive attributes, including traceability between business requirements and systems and high-level descriptions of data and security subarchitectures; (3) however, the blueprint is not yet complete and does not provide sufficient detail and precision for building or acquiring new systems; (4) in particular, IRS' systems life cycle (SLC) does not define in sufficient detail any of the SLC processes needed to manage technology investments; (5) as a result, IRS does not yet know: (a) how systems will actually be designed, developed, tested, or acquired; (b) how compliance with standards will be assessed and ensured; (c) how progress on projects will be determined; or (d) how key SLC products will be validated; (6) additionally, IRS plans for each of the three remaining blueprint components--business requirements, architecture, and sequencing plan--to include four levels of progressively greater detail; (7) as of May 15, 1997, IRS had completed the first two levels; (8) as a result, information that is critical to effective and efficient systems modernization is not yet known, essential decisions have not yet been made, and needed actions have not yet been taken; (9) IRS' Chief Information Officer (CIO) has acknowledged that essential elements are missing from the May 15, 1997, blueprint, and stated that he has begun addressing these voids; (10) however, even though IRS has given the CIO increased responsibility and accountability for managing and controlling systems development, acquisition, and maintenance, neither the CIO nor any other IRS organizational entity has budgetary and organizational authority over all IRS systems activities; and (11) as a result, it is unlikely that IRS will be able to institutionally implement and enforce its modernization blueprint once it is completed.


Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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