Message from the Chief Financial Officer
Carol F. Aten
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The USGS is committed to excellence as a premier science agency and strives for that same quality in its business and financial practices. In the last several years, our quest for excellence in our business and financial arena has been problematic. We received a disclaimed opinion from our independent auditors (KPMG LLP) and they were not able to render an opinion on our FY 2002 Annual Financial Report. Rather, the Department of the Interior's Office of Inspector General issued a report, titled "Observations on USGS' Internal Controls and Compliance with Laws and Regulations." This April 7, 2003 report identified eight (8) material weaknesses: (1) Information technology systems controls; (2) Organizational structure and leadership of financial management; (3) Financial reporting controls; (4) Account analysis and adjustments; (5) Revenue cycle controls; (6) Property, plant, and equipment controls; (7) Inventory controls; and (8) Working capital fund accounting.
To address these material weaknesses, a comprehensive corrective action plan was developed and implemented. Using this document as a guideline, we have made considerable progress in implementing the recommendations offered in the April 7, 2003 report. Significant effort has been devoted to improve our information technology systems controls, resulting in better security and management of these critical infrastructures. We have strengthened our financial management organization and leadership having employed a Deputy Chief Financial Officer with full authority and responsibility for the Bureau's financial management activities and added several skilled and knowledgeable accountant supervisors and operating accountants to key positions in the central accounting and finance office. We have also begun investing in training for our professional and administrative staffs throughout the Bureau. Revised policies, procedures, and processes have been instituted that lend better controls over financial reporting. The vital communications link between our central offices and regional and field offices has been enhanced through routine communications and the formation of two advisory teams: the Business Leaders Team (BLT) and the Field Managers Team (FMT). The BLT and FMT have provided valuable insight and advice on redefining and improving the Bureau's business practices. We remain committed to continuing this level of communication.
In keeping with our intent to eliminate barriers to integrated science and enhance planning and execution of our scientific programs, in FY03 we implemented our new planning and budgeting system, "Budget and Science Information System" (BASIS+). This system provides to our scientists and managers an automated tool for planning and tracking their work. Additionally, we began implementation of an automated maintenance management system (MAXIMO TM) that provides current cost and status data to our facilities managers.
The offshoot of these initiatives is an unqualified opinion on the Bureau's Consolidated Balance Sheet as of September 30, 2003. Eight of the nine previous material weaknesses were resolved, leaving four reportable conditions, one of which is a material weakness related to deficiencies in USGS' policies, procedures and controls over accounting for reimbursable agreements. Three of the prior year's material weaknesses were downgraded to reportable conditions, and relate to IT security, property management and intra-departmental eliminations.
Notwithstanding these improvements, we recognize that our goal of excellence in financial management is not a short-term initiative. However, in addition to maintaining our reputation as a premier science organization, we must and will continue to devote the needed resources to return the Bureau to its status as a top-notch business-operated organization. To that end, I remain committed to supporting integrated science with modern systems and processes in an environment of competent and accountable financial management.
Carol F. Aten
Chief Financial Officer and
Chief, Office of Administrative Policy and Services
October 2003
U.S. Department of the Interior, U.S. Geological Survey
URL: http://pubsdata.usgs.gov/pubs/03financial/html/cfo.html
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