The Treasury Department and the Office of Management and Budget have opened a new office that will focus on improving financial management processes across the federal government.
The Office of Financial Innovation and Transformation will be located in the Treasury Department and will work in collaboration with the OMB to reduce costs, streamline processes and provide better transparency of financial information. The FIT office is part of a larger initiative to stem the costs of financial operations. The Treasury and OMB estimate the effort will yield hundreds of millions in reduced financial system and operational costs annually. For example, agencies have estimated that they annually spend $750 million processing paper invoices for payments. A 20 percent reduction through automation would provide significant savings once fully implemented.
It is time to stop the increasing cost of financial operations and systems in the government today, said OMB controller Danny Werfel in a statement. The Treasury Departments new office will play a critical role by initiating common, simpler, and lower-cost solutions for basic financial management activities, such as accounts payable and reporting.
The federal budget provides $17 million for the Office of Financial Innovation and Transformation to develop shared, government-wide systems for agency financial management services, including invoice processing, cash collections and interagency agreement management. The effort aims to increase efficiency and reduce unnecessary paperwork by offering agencies central automated systems for transaction processing and financial report production.
The Treasurys Financial Management Service has made progress in providing electronic alternatives to agencies for funds being paid to the government. Currently 80 percent of the non-tax funds collected by agencies are collected using electronic methods. The FIT will support FMS in converting the remaining 20 percent to an all-electronic process, reducing costs by $40 million each year.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access