commerce follow up

8/4/2019 Commerce Follow Up

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UNITED STATES DEPARTMENT OF COMMERCEChief Financial OfficerAssistant Secretary for AdministrationWashington, D,C, 20230

July 6,2011

The Honorable Darrell E. Issa

ChairmanCommittee on Oversight and

Government Reform

House of Representatives

Washington, DC 20515

Dear Chairman Issa:

Thank you for your letter of March 8, 2011, regarding oversight of agency financial

management.

The Department of Commerce is committed to sound financial management and has created anenvironment that complies with federal laws and regulations; provides its executives with timely,

accurate financial and performance information; and ensures strong internal controls remain a

priority. This is evidenced by the Department's continuing compliance with the Federal

Financial Management Improvement Act (FFMIA), maintaining a single integrated financial

system, and achieving clean audit opinions. Fiscal year (FY) 2010 marked our twelfth

consecutive clean opinion as determined by an independent auditor.

Enclosed are details regarding the Department's financial management systems used to support

business and accounting functions; grants and loans management; contracts management; and

reporting to government-wide systems.

If you have any further questions, please feel free to call the Office of Legislative and

Intergovernmental Affairs at 202-482-3663.

Sincerely,

Lisa Casias

Director for Financial Management and

Deputy Chief Financial Officer

cc: The Honorable Elijah Cummings

Ranking Member

Committee on Oversight and

Government Reform

Enclosure



DEPARTMENT OF COMMERCE

Financial Management Systems

The Department's Federal Financial Management Improvement Act (FFMIA)-compliant

financial management system is the Commerce Business Systems (CBS). The financialinformation from CBS is integrated in the Corporate Database for consolidated financial

reporting, resulting in a single integrated financial management system.

CBS consists of a Core Financial System (CFS), which 'includes the Commerce Purchase Card

System (CPCS) and the Budget and Execution Data Warehouse. CBS is interfaced with the

Commerce Standard Acquisition and Reporting System (CSTARS), the National Finance Center

Payroll System, and the Automated Standard Application for Payments (ASAP). CBS provides

reliable, timely information within a sophisticated security infrastructure. The system is capable

of producing both financial and budget reports from information generated within the financial

management system.

CBS is the financial management system of record for the Office of the Secretary (OS), the

Census Bureau (Census), the Office of the Inspector General (OIG), the Economic Development

Administration (EDA), the Minority Business Development Agency (MBDA), the Economics

and Statistics Administration (ESA), the Bureau of Economic Analysis (BEA), the National

Oceanic and Atmospheric Administration (NOAA), the Bureau ofIndustry and Security (BIS),

the National Institute of Standards and Technology (NIST), the National Telecommunication and

Information Administration (NTIA), and the International Trade Administration (ITA). The

Department's remaining two bureaus-the National Technical Information Service (NTIS) and

the United States Patent and Trademark Office (USPTO)-use·different financial management

systems. Details of these two systems follow the information regarding CBS.

CBS is fully integrated with all its feeder systems through an enterprise application interface or

automated feeds. Information generated from the integrated financial management system and

those of NTIS and USPTO is consolidated and submitted to various government-wide

accounting systems maintained by the Treasury Department. The consolidated closing package

data (financial statements, notes, and other data reclassified into Financial Management Service

[FMS] specific format) are submittedannually by the Department through a combination of

manual and electronic means to the government-wide financial report system (GFRS).

Consolidated pre-closing adjusted trial balances using the United States standard general ledger

(SGL) proprietary accounts are submitted electronically by the Department to the Federal

Agencies' Centralized Trial Balance System I (FACTSI) on a quarterly basis. Budgetary

accounting data required for the Report on Budget Execution and Budgetary Resources (SF-133)

are submitted using a combination of manual entry and file upload to the FACTSII system by

each respective reporting entity (bureau) on a quarterly basis. Consolidated SGL proprietary

fiduciary account balances relating to any investments with the Bureau of the Public Debt

(BPD), borrowing from BPD or the Federal Financing Bank, Federal Employees' Compensation

Act transactions with the Department of Labor, and Employee Benefit Program transactions with

the Office of Personnel Management are submitted manually into the intragovernmental

fiduciary (IFCS) by the Department on a quarterly basis.

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Information from CBS is manually entered into the FACTSII Treasury system used in December

and January of each year to help generate the prior year's amounts which are updated and

submitted to the President's Budget Request in the MAX system. Several line entries are

automated in the MAX system and pull from FACTSII. A few detailed line entries, however,

must be entered manually. In addition, information generated from the Department's integratedfinancial management system is consolidated into quarterly and annual financial statements and

submitted to OMB electronically using the MAX federal community.

The Department's consolidated financial statements are published annually in the Department's

Performance and Accountability Report and online on the Department's website for public

viewing.

The Department is conducting the future financial and administrative planning business analysis

and will use this data to examine the Department's financial and administrative environment

(acquisition, grants, property, travel, and webTA) to determine the long-term viability of the

CBS platform and to evaluate CBS against other potential options to support Commerce'sfinancial management environment.

All bureaus except NIST, Census, and USPTO use Sunflower Assets as an enterprise Personal

Property Management System (PPMS): NIST uses Oracle Assets; Census, Automated Property

Management System; and USPTO, Enterprise Asset Management System.

All bureaus use Kronos webTA for recording time and attendance. USPTO, EDA, and MBDA

use the government-wide COTS software product, Hewlett Packard's FedTraveler, for travel

management. Both NIST and NOAA use a COTS software product (Travel Manager) and

Census uses an internally-developed travel management system (Travel Management

Information System) for travel management.

NTIS uses the budget and accounting purchase system (BAPS) as its financial management

system. BAPS' functions include general ledger, budget execution, accounts payable,

disbursement, accounts receivable, cost accumulation, planning, training, travel, procurement,

inventory, personal property management, and real property management. Transactions feed

electronically or manually between the various functions.

As with bureaus that use CBS, information generated from BAPS is consolidated into quarterly

and annual financial statements and are submitted to OMB electronically using the MAX Federal

Community. The Department's consolidated financial statements, including those of NTIS, are

published annually in the Department's Performance and Accountability Report which is also

published on the Department's website for public viewing. No migration or modernization

projects are planned for BAPS.

USPTO uses CGI's off-the-shelf (COTS) software product, Momentum Financials, for financial

management, financial management reporting, acquisition, and travel accounting. Momentum is

fully integrated with a real-time integration between Momentum financials and FedTraveler to

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record the financial impact of travel authorization and voucher transactions. Momentum has no

interaction with Remedy or webTA.

As with bureaus that use CBS, information generated from Momentum Financials is

consolidated into quarterly and annual financial statements which are submitted to OMB

electronically using the MAX Federal Community. The Department's consolidated financialstatements, including those ofUSPTO, are published annually in the Department's Performance

and Accountability Report which is also published on the Department's website for public

viewing. As a PBO, USPTO also publishes a separate audited financial statement in its

Performance and Accountability Report (PAR).

The budgetary data from Momentum Financials' SF-133s is periodically submitted to OMB

when the Department completes apportionment requests in MAX (data is manually entered and

submitted through the automated MAX Apportionment application) and when submitting data

required by OMB Circular A-II to prepare the President's budget in MAX (data is manually

entered and submitted into the MAX data entry system). The budgetary general ledger account

information, which is input into FACTSII on a quarterly basis, feeds the MAX system based on

actions by the Treasury staff. An upgrade to Momentum version 6.4.1 was completed in July,

2010, and there are no plans for additional upgrades. USPTO is activating the revenue

subsidiary functionality in Momentum Financials to replace the USPTO legacy custom fee

collection system. As noted above, USPTO uses Enterprise Asset Management System as its

PPMS; an update from version 6.3 to 7.6 is ongoing.

Systems For Managing Grants, Direct Loans and/or Loan Guarantees

The Office of Acquisition Management (OAM) is responsible for the Department's enterprise-

wide grants management policy, projects, and oversight. The Department's focus is to

standardize policy and procedures for its grant and cooperative agreement programs in order to

strengthen compliance, work toward a single automated grants management system, and enhance

and formalize workforce education. Targeted efforts continue to transform the decentralized

Department grants management community into an effective and efficient partnership. The

sharing of resources and responsibilities to accomplish enterprise goals is a recurring theme

throughout the partnership effort.

Integral to the Department's effort to migrate to electronic grants is the continued use of

NOAA's Grants-Online system, a back-office solution to the Grants.gov storefront. The system

is designed to facilitate efficiencies through standardized business processes and provide a direct

interface with other Department systems with grant recipients. Grants Online continues to

demonstrate significant success in reducing paperwork, increasing accountability, and

simplifying the post-award process. The Grants Online system has also been identified as the

solution to standardizing grants procedures in the Department. Itis a paperless electronic grants

management system that has gained department-wide recognition for streamlining and

accelerating the grant application process. This standardization effort is successfully aligning

internal processes to allow for consolidation of systems in line with government-wide efforts to

increase operational efficiency.

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The Department currently uses the following system to manage our grants:

• Grants.gov - A government-wide web portal used for Federal Funding Opportunity

(FFO) notices with corresponding application packages to manage initial grant

applications. This web portal allows members of the public to find any government-wide

grant opportunity and apply for it.

• Grants Online - As described above, this is NOAA's back-end system to Grants.govwhich supports the evaluation, award, and business processes for grant management.

Grants Online manages NOAA, ITA, MBDA, and OS grant reporting. Ithas a "public

search" link where the general public can find information and provides a searchable

database of awards that have been made.

• Operations, Planning and Control System (OPCS) - This is EDA's back-end system to

Grants.gov and is used to support the evaluation, award, and business processes for grant

management.

• .Grants Management Information System (GMIS) - NIST's back-end system to

Grants.gov and is used as a means of supporting the evaluation, award, and business

processes for grant management.

• Loan Billing and Management System (LBMS) - System of record used by EDA tomanage, monitor, and administer its outstanding Pre-Credit Reform Act loans. As EDA

does not have lending authority, LBMS is used solely to record loan payments and track

any delinquency.

LBMS does not interface with any of the Department's business or accounting systems.

Grants.gov interfaces with Grants Online, OPCS, and GMIS but does not interface with CBS,

BAPS, or Momentum Financials. Grants Online will interface with CBS in mid-October, 2011,

and currently interfaces with the Management Analysis and Reporting System (MARS). CBS

refreshes into OPCS nightly so that all transactions in CBS are identical with those in OPCS.

OPCS does not interface with any of the Department's other financial systems. GMIS interfaces

with CBS but does not interface with Hyperion; CSTARS; Oracle Assets; Travel Manager;Automated Classification System (ACS), the human resources system used by NIST; or with

CBS, BAPS, or Momentum Financials.

None of these systems maintain data that is submitted to the Catalogue of Federal Domestic

Assistance (CFDA).

Grants Online, OPCS, and GMIS interface with USASpending.gov (where Federal Assistance

Awards Data System [FAADS] PLUS data is submitted) for monthly submittals and use the Data

System Validation Tool (DSVT) to upload data; FAADS reporting is no longer required per

OMB memo dated February 10,2011. Grants.gov does not have data that is submitted to any of

the reporting systems; LBMS doesn't interface with USASpending.gov. The Department'sgrants offices use FederalReporting.gov and Recovery.gov to interface with grantees. However,

FedReporting.gov and Recovery.gov are not interactive with the Department's grants systems

named above and are, therefore, a manual process. Bureaus are able to go into the systems and

update when appropriate. .

There are no recent, current, or planned migration or modernization projects for Grants.gov,

GMIS, or LBMS. Within the past two years, Grants Online had migration of grants data for OS,

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ITA, and MBDA to its system. The Department is exploring the feasibility of migrating EDA

and NIST grants data into NOAA's Grants Online system. The first step in the process is to

conduct the Gap Analysis with NOAA Grants Online. The MOU is being finalized and the Gap

Analysis is planned for completion by September 30, 2012.

The Department currently operates the following direct loan and loan guarantee programs:

NOAA Direct Loan and Loan Guarantee Programs; EDA Direct Loan and Loan Guarantee

Programs; and the Emergency Steel Loan Guarantee Program. EDA does not issue any new

direct loans or loan guarantees. Its loan portfolio consists ofpre-FY 1992 Drought Loan

Portfolio direct loans and Economic Development Revolving Fund direct loans. The Emergency

Steel Loan Guarantee Program does not have any receivables, nor are there any outstanding non-

acquired guaranteed loans. The program has the authority to issue loan guarantees until

December 31, 2011.

NOAA has many direct loan program receivables, including Fisheries Finance Traditional

Loans, Crab Buyback Loans, and Bering Sea Pollock Fishery Buyback loans. NOAA also

operates the Fishing Vessel Obligation Guarantee Program (loan guarantees). NOAA uses the

following systems to calculate loans:

• The National Marine Fisheries Service (NMFS) Program Office developed and maintains

a database system known as SHARK. The financial data in this system is maintained by

NOAA Finance/Accounting Operations Division (AOD).

• NOAA Finance/General Ledger Reporting Branch (GLRB) uses sophisticated Microsoft

Excel cash flow templates to financially manage the direct and guaranteed loan programs.

• NOAA Finance (AOD and GLRB) use CBS to manage direct and guaranteed loan

programs.

• NOAA Finance (GLRB) uses Oracle Discoverer database queries to manage the direct

and guaranteed loan programs.

• NOAA Finance (GLRB) uses OMB CSC2 calculator and RSummary systems to managethe direct and guaranteed loan programs.

None of the information in the loan systems identified above is submitted to CFDA, nor do any

of these systems contain data that is submitted to any of the government-wide management and

reporting systems. Loan data is updated in USASpending.gov via manual entry. Pertinent data

from SHARK and from the NOAA Finance GLRB systems is extrapolated and manually entered

into CBS. There have been no recent, current, or planned migration or modernization projects

for any of these systems.

Interactions for NOAA's loan systems are that SHARK (NMFS Program Office and NOAA

Finance AOD), NOAA Finance GRLB (Excel cash flow templates and OMB CSC2 calculatorand R.Summary) all have pertinent data extrapolated and manually entered into CBS. CBS is the

system utilized to store data that has been manually entered in the aforementioned systems for

the NOAA Finance (AOD and GLRB) CBS system. The NOAA Finance (GLRB) Oracle

Discoverer database queries are an output and data source derived from the data manually

entered into CBS.

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Systems for Managing Contracts

The Office of Acquisition Management is responsible for the Department's enterprise-wide

acquisition management policy, projects, and oversight. The Department's focus is

standardizing acquisition policy and procedures in order to strengthen compliance, work towards

a web-based contract-writing system, and enhance workforce education. Efforts continue totransform the decentralized Department acquisition community into an effective, efficient

partnership through sharing of resources and responsibilities to better achieve acquisition

savings, meet program requirements, and manage risks.

The Department and its bureaus utilize Comprizon.Buy (C.Buy), Momentum Acquisition,.

Comprizon.Request (C.Request), and the Forecasting and Advance Acquisition Planning System

(FAAPS) to conduct acquisition forecasting and planning, prepare requisitions, and write

contracts, purchase orders, delivery orders, and modifications.

C.Buy is a COTS web-based acquisition management and contract-writing system which

processes contract awards and is used by OS, Census, NIST, and NOAA. These bureaus provide

acquisition services to other, smaller bureaus. This system provides commitment and obligation

data to the Department's C.Request system, the Commerce Financial System (CFS), and contract

data to the NIST portal. C.Buy interfaces with FPDS-NG with data electronically submitted in

real-time. There is a planned upgrade to a modern, web-based product, Comprizon.Award,

scheduled for December, 2011.

USPTO uses Momentum Acquisition, a COTS web-based acquisition management and contract-

writing system'. to process contract awards. Momentum Financial integrates with Momentum

Acquisition and directly records commitments and obligations. Momentum Acquisition also

interfaces with FPDN-NG with electronically submitted data in real time. There are no

migration or modernization projects planned.

OS, Census, NIST, and NOAA use C.Request, a COTS web-based requisition management

solution that processes requisitions. C.Request interfaces with both C.Buy and CFS. There are

no migration!modernization plans at this time for C.Request.

FAAPS, a web-based advance acquisition planning system for identifying forecasts for

requirements above the simplified acquisition threshold, is used by OS, Census, NIST, and

NOAA. FAAPS does not interface with any system, and there are no migration! modernization

plans.

The Department does not provide to the public the information it submits to the government-

wide contract management and reporting systems.

For data submitted to USASpending.gov, Department acquisition offices perform monthly

reconciliations of actions submitted and housed in the contract-writing systems against actions

reported as final in FPDS-NG. Differences are investigated, necessary corrections made, and the

two databases are regularly balanced. During this review, spot checks are made for data element

anomalies. If anomalies are found, they are researched and any required corrective action is

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taken. In addition, acquisition, offices utilize the "Status of Actions" and "Draft and Error"

FPDS-NG reports to audit contract entry and erroneous data. All contract data provided to

USASpending.gov is submitted through government-wide systems that feed into

USASpending.gov.

There were 26,405 total transactions recorded in FPDS for the Department during FY 2010 witha total dollar value of $3,938,195,964. Through a random sample of contract action reports, the

Department has certified an overall accuracy rate of98% for FY 2010.

As all data required under FFATA interfaces with data submitted through existing government-

wide systems (i.e., FDPS-NG and USASpending.gov), the Department does not incur an

additional burden in fulfilling FFATA reporting obligations.

In compliance with the "Open Government Directive - Framework for the Quality of Federal

Spending Information" memorandum issued by OMB on February 8, 2010, the Department

developed a Data Quality Plan that established a framework for implementing internal controls

and strategies to improve the quality and integrity of Federal spending information that is

disseminated through such public venues as USAspending.gov. The Data Quality Plan includes

developing an oversight process through Acquisition Management Reviews and Grants

Management Reviews to evaluate efficiency, effectiveness, data quality, and to ensure

transparency. The Plan also requires annual reporting on fulfillment of action items aligned with

OMB's data quality metrics.

Scott Quehl, Chief Financial Officer and Assistant Secretary for Administration, serves as the

Department's senior accountable official over federal spending data quality.

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