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The U.S. Department of State is embarking on an overhaul of its financial management system, aimed at replacing crumbling hardware and proprietary COBOL-based financial management applications, the oldest of which dates back nearly 30 years.
The upgrade of the departments Regional Financial Management System, or RFMS, will allow officials at U.S. embassies around the globe to track financial data in real time over the Web. RFMS will also provide, for the first time, full online integration among the agencys budgeting, accounting and currency disbursing functions.
These improvements will enable the embassies to meet the federal governments strict accounting and budget reporting requirements as those requirements evolve, said State Department officials.
“Well better understand how and where were spending our money” once the RFMS system is modernized, said Alan Evans, managing director of financial management services at the State Department. “By being able to capture and analyze fiscal data associated with each transaction, well have the ability to provide department managers with information that will help them prioritize how funds are allocated among our various programs.”
The first phase of the four-year, $38.4 million RFMS project is the implementation of American Management Systems Inc.s Momentum financial management software suite at 168 U.S. embassies and consulates. The software will link the embassies to two regional State Department financial services centers, one in Charleston, S.C., and the other in Bangkok, Thailand.
The project kicked off when the department went live with the Momentum software at the U.S. embassy in Lima, Peru, late last fall. The next locations to go live will be the U.S. Interest Section in Havana and embassies in Montevideo, Uruguay, and Kuala Lumpur, Malaysia, this year.
In addition to the Momentum deployment, the State Department will migrate its staff to Windows 2000, re-engineer some transaction processes, and replace older Wang Laboratories Inc. and IBM hardware at the financial services centers.
A big impetus for the overhaul is the plethora of regulations calling on government agencies to improve financial IT systems and accounting practices, Evans said.
The 1996 Federal Financial Management Improvement Act requires that all federal agencies comply with certain federal accounting rules, use the standard government general ledger and follow certain other rules on electronic financial management by September 2003, Evans said.
Another prod comes from the JFMIP, or Joint Financial Management Improvement Program, a 53-year-old program involving several departments that calls on federal agencies to meet certain standards for improving financial services functions and simplifying the procurement process.
The Momentum implementation will bring the State Department into full compliance with current JFMIP rules, Evans said. This is no small feat, according to one analyst.
“Its very difficult [for financial management software products] to meet the JFMIP requirements,” said Ray Bjorklund, an analyst at Federal Sources Inc., a government IT consultancy in McLean, Va. Bjorklund noted that several of AMS competitors, including SAP AG, had to make numerous tries before they could get their government financial management packages JFMIP-certified.
AMS software will provide the State Department with far more complex cross-agency financial reporting and cost accounting functionality than was possible with the old system, said Zip Brown, vice president of Federal Solutions at the Fairfax, Va., company.
Between five and 20 employees at each embassy will use the software, along with many more at the State Departments offices in Washington.
The RFMS project is part of a $300 million, three-pronged undertaking to modernize other aspects of the State Departments IT infrastructure. Last year, Secretary of State Colin Powell presented his department with a mandate to provide all 50,000 department workers with Internet access, launch LANs for housing classified information at each embassy and create a portal allowing for online collaboration among the 40 U.S. agencies operating overseas.
The Internet access project, due to be completed by March 2003 at a projected cost of $100 million, is under way with some 16,000 agency workers outfitted with Internet access so far, said Bruce Morrison, deputy CIO at the State Department. “Were doing a lot of testing on the system, and we have a heavy reliance on firewalls,” Morrison said.
The LAN project, to be completed by December 2003 and projected to cost $200 million, calls for each embassy and State Department office worldwide to get its own secure LAN. This will also give State Department workers overseas access to the Department of Defenses classified information network, called the Secret Internet Protocol Router Network.
A prototype of the online collaboration portal is to be finished by September. A final completion date and total cost estimate for this project have yet to be set.
Maria Seminerio is a Boston-based free-lance writer. She can be reached at [email protected].