Please Note

This presentation varies slightly from the original. The slides have been updated to comply with internet publishing requirements.

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VHA Finance ConferenceAugust 2011

FINANCIAL POLICY

http://www.va.gov/finance/policy/pubs/volumeIII.asphttp://www.va.gov/finance/policy/pubs/volumeIII.asp

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OVERVIEW

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Presenters

• Yolanda Bostic – Auditor, FQAM, VISN 7• Karen P. Brown - Supervisory Accountant, VA Office of

Financial Policy• Ogbeide Oniha - Director, VHA Financial Management

& Accounting Policy• Marilyn Patton - Lead Accountant, VHA Accounting

Policy• Jana L. Sjoquist - Staff Accountant, VA Office of

Financial Policy• Carolyn A. Wright - Associate Director, MQAS

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Presentation Objectives

Overview of process for development of VA policies and how they relate to VHA guidance and processing in daily operations

Overview of the role of auditing in ensuring policy compliance

Identify where to locate the policies and changes

Overview of the process for requesting assistance with policy.

Identify VHA Policy Initiatives

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Agenda

VA Policy Process VHA Policy Development and Assistance Process

The Role of Auditing in Ensuring Policy Compliance

VHA Policy Initiatives Questions

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VA POLICY PROCESS

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Presentation Purpose

To identify the Chief Financial Officer’s duties as promulgated by legislation,

To assist in understanding the Office of Financial Policy (OFP) Accounting, Payroll, and Travel Policy Service,

To provide an overview of the process implemented and refined to update VA policy,

To identify OFP Policy which has replaced VA Directives, Handbooks, Manuals, Bulletins, and Travel Notices, and

To identify resources available when questions arise related to financial policy.

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CFO Authority

Title 31, Section 902(a)(5) of the United States Code (U.S.C.) requires that each agency’s Chief Financial Officer (CFO) “direct, manage, and provide policy guidance and oversight of agency financial management personnel, activities, and operations.”

Title 38, Section 309 of the U.S.C. states that the Secretary shall designate the Assistant Secretary whose functions include budgetary and financial functions as the Chief Financial Officer of the Department. The Chief Financial Officer shall advise the Secretary in financial management of the Department and shall exercise the authority and carry out the functions specified in section 902 of U.S.C. Title 31.

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VA CFO Organization

Grants Management ServiceDirector

Office of Financial PolicyAssociate Deputy Assistant Secretary

Office of the Deputy Assistant Secretary for Finance

Management/Financial Reports ServiceDirector

Executive in Charge and Chief Financial Officer

Secretary of VA

Cash and Debt Management ServiceDirector

Accounting and Payroll Policy ServiceDirector

Systems to Drive Performance (Initiative)Program Manager

Office of Financial PolicyDeputy Director

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VA Accounting and Payroll Policy Service

Director

Staff Accountant Supervisory Accountant

Staff Accountant

Systems and

Procedures AnalystSystems Accountant

Systems Accountant

Systems and Procedures Analyst

Accounting Accounting & FMS Payroll Travel

Supervisor

Systems and Procedures Analyst

Systems and Procedures Analyst

Systems and Procedures Analyst

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OFP Responsibilities VA OFP provides VA-wide financial policy and guidance. OFP scope of responsibilities:

• Develops, coordinates, issues, evaluates, and reviews VA financial policies, systems, and procedures for compliance with all financial laws and regulations.

• Prepares VA’s annual Consolidated Financial Statements and other comprehensive financial reports.

• Works with the Office of the Inspector General’s independent contract auditors on VA’s annual Consolidated Financial Statements audit.

• Assists VA’s Office of Budget in incorporating statements and audit results in the Annual Performance and Accountability Report (PAR).

• Develops policies and procedures for cash and debt management and other Governmentwide programs and initiatives.

• Provides VA-wide customer support.  More information on OFP may be accessed through the VA internet 

Web site: http://www.va.gov/finance/policy  

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VA Financial Policy Revision Financial Policy Improvement Initiative (FPII)  

• Established to address financial statement material weaknesses and significant deficiencies by developing, updating, and standardizing VA wide financial policy and procedures.

• Established Integral Roles of the Subject Matter Expert (SME), Financial Policy Working Group (FPWG), Financial Policy Steering Committee (FPSC), and Chief Financial Officer (CFO)

- SME – first line reviewer of policies.- FPWG – formulates and reviews draft financial policies and procedures submitted by the SMEs, and concurs on chapter to be presented to the FPSC.

- FPSC – reviews and approves (or disapproves) policy guidance submitted by the FPWG and recommends approved policy to the VA CFO.  Comprised of representatives from VA’s senior management and Administrations’ Chief Financial Officers. 

- CFO (senior executive level) - reviews, approves, and issues policies.

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VA Financial Policy Revision

FPII Completed – Jul 2011 Rescission Memorandum submitted to rescind superseded

Directives, Handbooks, Manuals, Bulletins, and Travel Notices, as appropriate. These will be archived.

Financial Policy Improvement (FPI)• On-going project to review, update, or rescind published policy or to implement new policy guidance;

• Project will review published Volumes/Chapters on a recurring basis very 3 years;

• New guidance will be incorporated into existing or new chapters;• Draft charter is being reviewed to ensure the same level of support and participation as the original FPII.

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VA Directive Flowchart Process

6. Concurrence and draft policy

forwarded to CFO for

approval & signature.

No

No

4. Comments received &

researched.

Yes

Yes

Back to 3.

No

Yes

7. CFO approved policy forwarded to

AS/OI&T for certification &

signature.

Receive signature?

Yes

8. Signed policy

published.

Approve policy?

No

YesNo

Week 1 Weeks 2 to 20 Weeks 20 to 22 Weeks 22 to 24 Weeks 24 to 26

3. Proposed new/revised

policy posted to VAIQ and reviewed by respective

staff for comments & concurrence.

2. Policy researched and drafted by OFP, Administration, or other staff

office.

1. Possible need for new

policy or revision

identified to OFP.

Need to include

comments?

Receive concurrence

from all?

5. Communicate decision to

appropriate staff.

Back to 3.

Receive concurrence?

Back to 3.

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6. FPWG appro

ved policy

forwarded to FPSC for

review,

discussion & vote.

No N

o

1. Possible need for

new policy or revision identifie

d.

2. Possible

need for

policy researched and drafted by OFP

or other staff. All proposa

ls are reviewe

d by OFP

prior to FPWG

review.

Identify where

the new policy

or change

is written.

No

Week 1 Weeks 2 to 4 Weeks 5 to 6 Weeks 7 to 8 Weeks 9 to 10

Yes

Approve

policy?

Yes

Back to

4.

No

Yes

7. FPSC approved polic

y forwarded to CFO for

approval

& signature.

Approve

policy?

8. CFO

approved & signed policy published.

Yes

Policy needed? 5. Draft

policy reviewe

d by FPWG

for discussi

on & vote.

4. Main POC, OFP

contact, and SMEs assigned to draft

policy.

3. Request reviewe

d by FPWG

for discussion and

SME identific

ation.

Back to

5.

Approve

Policy?

VA FPI Flowchart Process 16

Why the FPI Process Is Boss

FPI Process• Buy-in and approval from lower to 

upper level – Hands on approach• Partnership for development/ 

revision of accounting policy• All request flow through OFP for 

initial review and then presented to FPWG.

• Draft policy developed and written by a POC and assigned SMEs (by FPWG)

• FPWG reviews the draft policy as a group and resolves issues

• FPSC reviews the policy as a group; resolves or submits back to FPWG for resolution

Directive Process• Top down approach for implementing 

policy • All request flow through OFP for initial 

review and preparation of draft policy• Draft policy is posted to VAIQ for 

comments• Comments are worked  as received, 

but require concurrence from each staff – worked through VAIQ, email or calls

• If concurrence is not received from every office, OFP must contact non-responding office and request review and concurrence, adding additional time overall. 

• Onus is on OFP to receive concurrence, not each staff to respond timely.

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OFP Volume and Chapter MatrixVA OFP VOLUMES AND CHAPTERS VA FINANCIAL POLICY DIRECTIVES/HANDBOOKS

REL OFP VOL REL OFP CH OFP TITLE OFP DATE DIR DIR TITLE REL HDBK TITLE DESCRIPTION

VOLUME I - GENERAL ACCOUNTING

I 1Introduction to VA’s

Accounting Policies1/27/2009        

I 1AProcess to

Update/Develop Financial Policy and Procedures

1/12/2009        

I 1BQuality Financial

Information12/8/2010        

I 2United States Standard

General Ledger1/27/2009

4520General Ledger

Accounting4520

Standard General Ledger Chart of Accounts and DefinitionsI 3

Maintenance of the Standard General Ledger

1/27/2009

I 3APAID Accounting

Operations1/27/2009        

I 4Financial Management

System1/27/2009 4510

Financial Management Systems

None  

I 4A Revenue Source Codes 8/20/2009        

I 4BAccount Classification

Codes1/27/2009        

I 5Management

Responsibility for Internal Control - Rvsn

11/29/2010 0070Management

Accountability and Control Program

None None

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The spreadsheet with OFP Volumes and Chapters to Directives/Handbooks Matrix: is available in the VA Notice 11-04 which is hyperlinked on the VA OFP Volumes Web site, http://www.va.gov/finance/policy/pubs/ .

VHA POLICY PROCESS

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Presentation Purpose

Introduction to the organization and structure of the VHA Office of Financial Management and Accounting Policy (10A3A).

Policy/regulatory research resources and process. Outline the procedure for submitting a policy inquiry. Process for requesting changes to VA Financial Policy

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Organization and Structure

Chief Financial Officer

Deputy Chief Financial Officer

Associate Chief Financial Officer

Director, Financial Analysis and Oversight

Director, Financial Management and Accounting 

Policy

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VHA Financial Management and Accounting Policy

Director, Financial Management and Accounting Policy

Supervisory Accountant

Policy Inquiries & Financial Indicators

Special Projects:  Cost Centers, 

BOCs, FPI, & FHCC

Supervisory System Analyst

Transit Benefits & Travel Card Policy and Oversight

Payroll Policy & Oversight

Agent Cashier, PFOP, & Debit 

Card

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Process to Request VHA Policy Assistance

Determine the subject of the inquiry.• Financial/Accounting Policy• Transaction Processing through FMS/IFCAP, etc.• Contracting

Request Assistance from Local Resources, i.e., Chief Fiscal/Financial Officer, Contracting Officer, IFCAP Coordinator, Chief, Voluntary Service, etc.

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Send an email to the appropriate policy Outlook Mailbox or Mailgroup.  Refer to VHA Alert Volume 2011, Issue 9 VHA Central Office Reorganization.

Process to Request VHA Policy Assistance

 Describe your situation completely and succinctly.

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 What Happens Next• Inquiry is assigned to an Accountant to research.

• Accountant may respond by requesting additional information.

• The Accountant assigned the inquiry begins to research.  When necessary, other organizations are contacted for  assistance.

• A response is drafted and reviewed for quality control purposes by a minimum of one other person.

• Response is provided.

Process to Request VHA Policy Assistance25

Identify policy to be changed and complete the Request for Policy Update form located on the OFP Accounting Policy web site, http://www.va.gov/finance/policy/accounting .

Present the justification and recommendation to the Station Chief Financial/Fiscal Officer for concurrence.

Send the recommendation to the VHA CFO Accounting Policy (10A3A) Mailbox.

Process to Request VA Policy Changes 26

VHA Policy will review the completed documentation and assess the overall impact to VHA.

VHA Policy will submit approved requests to VA Policy.

Process to Request VA Policy Changes 27

Policy/Regulatory Research Sources

Research the VA Policy Website for a published VA Policy. Use references and resources included in the Policy for additional research:

http://www.va.gov/finance/policy/pubs/

http://www.va.gov/vapubs/ Research the VHA Policy Website for published Policy:

http://www.va.gov/vhapublications/ Research the HR Policy Website for published Policy:

http://www.va.gov/vapubs/

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Research the Construction and Facilities Management Website for published Policy:

http://www.cfm.va.gov/ Appropriation Law (GAO opinions and US Code):

http://www.gao.gov/legal/redbook/redbook.html Federal Accounting Standards Advisory Board

Pronouncements:

http://www.fasab.gov/standards.html VA General Counsel:

http://www.va.gov/OGC/ VA OIG Publications: 

http://www.va.gov/oig/publications/

 

Policy/Regulatory Research Sources29

THE ROLE OF AUDITING

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The Role of Auditing in Ensuring Policy

Compliance

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Audit Community

VHA Financial Quality Assurance Management (FQAM)

VA Management Quality Assurance Service (MQAS)

VA Internal Control Service (ICS) VA Systems Quality Assurance Service

(SQAS) Office of Inspector General (OIG) Government Accountability Office

(GAO)

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Who Are We?

FQAM Internal oversight Unique to each VISN Review specific areas Long-term

relationship with each medical center

Reviews all medical centers within the VISN

MQAS External oversight Reports to VA Reviews random areas Short-term

relationships with the medical center

Reviews selected medical centers nationally

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Who Are We?

Please note: Because FQAMs report to the VISN,

there may be variability in terms of what each FQAM may be reviewing in each VISN at any point in time. However, there is some consistency.

FQAM & MQAS makes a collaborative effort to work together.

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What We Do?

Oversight Audits Reviews Investigations Queries Management Advisory

Services

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False Perceptions of Auditors

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We’re Here to HELP!

Our goal is to promote effective, efficient and ethical practices and procedures based on current policies.

Teach + Train = Change

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How Policy Affects Our Audits

We provide oversight to ensure that current policy is followed at Station, VISN and National levels.

We use current VA and VHA policies and procedures to design our audit/review plans.

Findings are based on current policy. Non-compliance with policy will lead to findings.

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How Policy Affects Our Audits

Request clarification from the appropriate policy office when a policy or procedure does not appear to be designed appropriately or requires clarification so that we may incorporate it into our program appropriately.

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How Policy Affects Our Audits

Reasons for not following policy – lack of knowledge (training & education), existing policy may not be clear or there are inconsistencies, or simply accustomed to doing it the way it has always been done

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VHA POLICY INITIATIVE

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OVERVIEW

VA’s financial management policies and procedures were developed to ensure compliance with:

• Appropriation and Debt Management laws and regulations, • Office of Management and Budget (OMB) Circulars, • Statement of Federal Financial Accounting Standards

(SFFAS),• Federal Accounting Standards Advisory Board (FASAB),• Department of Treasury’s Financial Management Service

(FMS), and • Other guidance, laws and regulations.

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OVERVIEW

• VA completed final phase of updating its financial policies under the Financial Policy Improvement Initiative (FPII).

• The FPII contract with Grant Thornton ended June 2011 and produced over 170 approved chapters grouped under 16 volumes.

• VHA facilities expressed the need for more detailed procedures to supplement several of VA approved policy chapters to meet VHA operational needs.

• Initial assessment - 73 of 170 VA policy chapters require supplemental procedures.

• These appendices will also incorporate VHA Handbooks, Directives and Alerts and any relevant policy.

• These appendices will be developed with VHA finance community support.

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PROJECT OBJECTIVE

The primary objective of this initiative is to develop a set of national procedures in the form of appendices to these VA policy chapters to ensure that financial policy and procedural information is standardized and accurate, and clear detailed procedures are readily available across the Administration.

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The Director, VHA Financial Management & Accounting Policy, will have oversight over the policy development project.

The VHA 10A3A project team will consist of a project manager to schedule, monitor progress and coordinate activities, accountants to coordinate technical working group meetings, an administrative support person and a technical writer.

VHA Accounting Policy staff will coordinate meetings with Subject Matter Experts (SMEs) and Working Groups.

Subject matter experts (SMEs) will include representatives from accounting, budget, and finance staffs in Medical Facilities, VHA Central Office, and VA Office of Financial Policy. For each Appendix, or related group of Appendices, the SMEs and the VHA 10A3A project team will meet at a convenient location to develop the Appendices.  

The PROCESS45

VHA Advisory groups, including Financial Management Advisory Council (FMAC), Fiscal Quality Assurance Managers (FQAM), and Veterans Integrated Service Network (VISN) CFO’s, will form a VHA Financial Policy Working Group to review each Appendix via conference calls. Prior to submission to the Executive level Steering committee, comprised of VHA AsCFO, DepCFO and CFO, a technical writer will review and edit each Appendix. Approved Appendices will be forwarded to VA for review and inclusion in VA Policy Chapters.

The PROCESS46

PROCESS FLOW DIAGRAMThe PROCESS

VHA ACCOUNTING POLICY APPENDIX DEVELOPMENTV

A F

PS

CF

PE

LSC

FP

WG

SM

E R

evie

wT

eam

F

orm

atio

n

Identify SME’s; Send review materials; make travel plans

Identify VA PolicyReview VHA

materials for as is processes

10 days prior to meeting

SME group meet for 1

week to draft Appendix

SME Draft Appendix1 week to finalize

Provide SME Draft to

Working Group for Review

2 weeks to reviewDoes the FPWG

approve Appendix ?

No, return to SME Group

YES

Technical Review

FPELSC Review

2 weeks to review Approve

Appendix ?

No, Return FPWG

YES

VA FPSCReview

Approve Appendix ?

No, Return to VHA

1 week

2 -3 weeks

Publish Appendix

12 Weeks Total

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Key Activities

Some of the key activities to complete a review of VA Policy to ensure all VHA specific requirements are included:

• Obtain an inventory of VA’s published policies by Volume and by Chapter.

• Obtain an inventory of VHA Finance Office policies ( Directives, Handbooks, Alerts, Manuals, Memorandums and Notices).

• Institute the VHA Financial Policies Working Group (VHA FPWG). The VHA FPWG will include representatives from FMAC, FQAM, National Fiscal Officers, CPAC Fiscal Officers, and MQAS.

• The Identify VHA Subject Matter Experts (SME’s) from the VHA Finance Community for each Chapter (no more than six to nine participants per Chapter).

• Create a Work Plan, which lists all VA Policy chapters, and establishes a due date, to ensure that each VA Policy Chapter is reviewed in a timely manner.

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• Solicit input from VHA’s SME’s to assist in the process of reviewing VA Policy, and, as appropriate, determine the need for a VHA specific appendix to the Chapter or the incorporation of existing VHA Policy into an Appendix.

• Determine whether existing VHA financial policies and procedures are applicable, and determine if the policy should be incorporated into VA Policy as an Appendix or whether it should be revised as necessary and maintained.

• Once this has been determined, VHA Accounting Policy will meet with the SMEs at a mutually convenient site and create a draft of the Appendix or modify the VHA Policy as appropriate. Create a SharePoint site to facilitate revisions from the SMEs.

• Once a draft is created, forward to the VHA FPWG for final review. Annotate the source of any changes to each Appendix for each chapter, using the tracked change function, to facilitate the review of the appendices.

• Utilize teleconference and/or NetMeeting, when beneficial, to ensure engagement of all chapter participants.

Key activities 49

• Ensure that all VHA SMEs and other VHA offices (VISN CFO’s, FMAC, FQAM) have reviewed and accepted the preliminary drafts of the appendices prior to submission. Annotate the source of any changes to each Appendix for each chapter, using the tracked change function, to facilitate the review of the appendices.

• Incorporate amendments by Senior Management into a Final Document to be forwarded to VA Accounting Policy for approval to include with VA Policy.

• Submit to VA Accounting Policy for incorporation as an appendix to the policy.

Key activities 50

Questions or Comments?

Now is the time!

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