USDA joins the ranks of the financial shared services providers

Monday - 5/5/2014, 4:59am EDT

Agencies will continue to have four approved federal shared services providers to buy financial management services from. The only difference is the Agriculture Department replaces the General Services Administration.

The Office of Management and Budget and the Treasury Department today announced they recertified the departments of Interior, Treasury and Transportation and added USDA to be the support pylons of its shared services initiative.

"Using a financial management shared service provider will help agencies reduce the risk of new system implementations, allow for faster and less expensive technological innovation, provide long-term cost savings and meet governmentwide requirements and deadlines," OMB Deputy Director for Management Beth Cobert and Treasury's Fiscal Assistant Secretary Dick Gregg wrote in a blog post Friday. "As a result of these improvements, agencies will be able to focus more of their resources and leadership attention on mission-based programs."

By adding USDA, OMB and Treasury partly solve concerns over a lack of competition among providers, because they all offered Oracle as their back-end software. USDA offers SAP's federal financials.

"Treasury and OMB designated these organizations after a comprehensive application process that included leadership commitments, system evaluations, reviews of plans for scaling operations and determinations that the providers have the capabilities to address the requirements of cabinet level agencies," Cobert and Gregg wrote. "Additional providers or product offerings may be designated in the coming years as more agencies look to move to shared services and lessons are learned from the initial four providers."

USDA in 2013 continued deploying its Financial Management Modernization Initiative (FMMI), a new financial system that replaces USDA's legacy financial system, according to OMB's January 2014 report to Congress on the benefits of E-Government initiatives. "FMMI is based upon a commercial, off-the-shelf resource planning product. FMMI is an advanced, Web-based, financial management system that provides general accounting, funds management, and financial-reporting capabilities that has been deployed to 28 of USDA's 29 administrative organizations."

GSA's decision to get out of the financial management services is no real surprise. The agency said it was getting out of the human resources services last summer, and several government and industry sources said financial management wasn't far behind.

But by GSA not receiving OMB and Treasury's approval, it means one less software package will be available for agencies to choose from (it offered CGI's Momentum), and it's unclear what will happen to the people running the Federal Integrated Solutions Center's External Services Branch or its 44 internal and external financial management customers.

OMB and Treasury's approval of the four providers should kick off a series of decisions that will underlie the financial management share services effort.

Beth Angerman, the director of Treasury's Office of Financial Innovation and Transformation (OFIT), said earlier this year in an interview with Federal News Radio her office is working with the providers to address their needs and concerns.

She said they will come up with plans or actions to respond to any gaps or issues the providers already have identified.

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