AGA Update and Issues and Challenges in Government Accountability John E. Homan AGA National President-Elect AGA Southern Arizona Chapter April 15, 2015

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AGA Update and Issues and Challenges in
Government Accountability John E. HomanAGA
National President-ElectAGA Southern Arizona
ChapterApril 15, 2015
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Agenda

• AGA Current Activities
• CFO-CIO Summit May 1 in Washington
• Government Performance Summit, May 4-5, 2015
• CEAR Dinner, May 20 in Washington
• Professional Development Training in Nashville
  July 12-15, 2015
• Theme for 2015-16 Celebrating the Government
  Workforce
• Key issues in Government Accountability
• Need to bring Government and the private sector
  together
• AGA Corporate Partner Group
• Need to Address Gaps in Accounting Education
• Need to Address Human Capital Issues
• How AGA can help your career

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AGA Current Activities
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AGA Current Activities

• Recent Events
• New Chapters in Mexico City expanding AGAs
  international focus
• And in South Florida
• Associations Summit in New York December 2
  (AICPA, IIA, AAA, AGA, FEI and IMA)
• AGA Systems Summit held on January 8
• 400 live guests 400 virtually
• AGA National Leadership Conference completed
  February 11-12
• 685 total guests
• Michael McConnell former Director of ODNI
• Mayor Nutter of Philadelphia
• AGA Journal of Financial Management Latest issue
  on Accountability, Transparency and Citizen
  Engagement sent out March 1

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AGA Current Activities-CTD

• Certificate of Excellence in Accountability
  Reporting (CEAR) program underway
• 19 submissions, 10 from CFO Act Agencies
• Annual Awards Dinner is May 20
• CFO-CIO Summit May 1 at Marriott in DC
• Mark Reger, Deputy Controller OMB
• Tony Scott, CIO of OMB
• Brad Hutcher, CFO HUD
• Rafael Diaz, CIO HUD

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AGA Current Activities-CTD

• AGA Performance Summit, Washington May 4-5, 2015
• General (Ret.) Ronald R. Fogleman, 15th Chief of
  Staff, U.S. Air Force
• Tim Bowling, Chief Quality Officer, U.S.
  Government Accountability Office
• AGA PDT, Gaylord Opryland, Nashville July 12-15,
  2015
• PDT theme is Innovate, Transform, Achieve
• Over 75 breakout sessions in all areas-Federal,
  State/Local, Speakers include
• Gene L Dodaro, Comptroller General of United
  States
• David Mader, Controller of the Office of Federal
  Financial Management, OMB

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Theme for 2015-2016 Celebrating the Government
Workforce

• And the dedication, Skill and Integrity at both
  the federal and State/Local Levels

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The Current Environment

• My perspective on Government is a very positive
  one which contrasts with a lot of what we all
  hear about Government and government workers
• Many in the media malign and denigrate the work
  of those in government
• Often times we hear of the lack of competence,
  the supposed lack of efficiency and innovation in
  solving problems
• Often hear the phrase need to make government
  operate more like a business implying that what
  goes on in government is second rate and inferior
  to the private sector
• This has led to the imposition of austerity
  policies which are often not thought out and
  which adversely impact worker morale and reduce
  the normal optimism of our members
• Unfair comparisons are often made of the
  compensation of government workers who are among
  the most highly skilled and specialized
  individuals working in the most complex
  environments

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A Key Focus for the Coming Year

• Identify ways to change the publics perception
  of the Government worker
• Seek opportunities to share positive aspects of
  beneficial programs, for example
• Use of analytics to identify and prevent fraud
  and improper payments
• Movement to shared services to reduce cost
  through standardization
• Hear from you, about your stories and successes
  so they can be shared
• Provide opportunities to highlight positive
  examples, through The Journal, TOPICs, member
  feature stories
• Support the work of our Corporate Partners Group
  as a bridge between Governments and the AGA and
  the public

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Key Issues in Government Accountability

• Need to Bring government and the Private sector
  together
• AGA Corporate Partner Advisory Group Surveys and
  Thought Leadership

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AGA Corporate Partner Advisory Group Committees

• CPAG is the corporate arm of AGA and is an
  important bridge between the private sector and
  government
• 80 firms (large and small) from across the full
  spectrum of companies which serve the government
• It unites the major private sector companies who
  serve the federal and state/local governments
  with those governments
• Its membership is a Whos Who of the major
  private sector firms in the Government market-The
  major Accounting firms, Consultancies, IT Firms
  are all members

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CPAG Corporate Partners Professional Level

• Accenture
• Audimation
• Bank of America
• Booz Allen Hamilton
• Boston Consulting Group
• CACI
• CGI Federal
• Citi
• CliftonLarsonAllen LLP
• CohnReznick
• Deloitte.
• EY
• Federal Management Systems Inc
• FI Consulting
• Fiserv
• Graduate School
• Grant Thornton LLP
• IBM
• Infor

• LMI
• Management Concepts
• MasterCard
• Mayer Hoffman McCann P.C.
• McGladrey
• Miracle Systems LLC
• MorganFranklin Consulting
• Navigant
• Oracle
• PNC Bank N.A.
• PwC
• Robbins Gioia
• SAP
• Savantage
• SUSE
• T. Curtis Company
• VISA
• Watkins Government Services
• Wells Fargo

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CPAG Sponsored Annual Surveys

• Inspector General Community
  Sponsor
  Kearney Company, Released September 2014
• Chief Financial Officer Community
  Sponsor Grant
  Thornton LLP, Released October 2014
• Chief Information Officer Community
  
  Sponsor Accenture, Released January 2015

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CPAG Thought Leadership

• Research Projects
• Internal Controls in Federal Grants and Programs
  Sponsor Crowe Horwath
  December 2014 Release
• Impact of Defense Contract Audit Agency (DCAA)
  Service Issues
• Sponsors Cotton Co and KPMG
• Federal Financial Reporting Model
  
  Sponsor
  CliftonLarsonAllen

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Key Issues in Government Accountability

• Need to Address critical gaps in accounting
  education

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Critical Gaps in Accounting Education

• Form And Content of Uniform CPA Examination
  Recently attended AICPA focus group on form and
  content of CPA examination which alerted me to
  the issues
• The current form and content of CPA examination
  has very limited requirements related to
  government accounting. There is no requirement
  that Examinees have any knowledge whatsoever of
  the governance structure of federal accounting. A
  prospective CPA does not have to have any
  knowledge of the operation of the Federal
  Accounting Standards Advisory Board and the
  standard set of federal statements are not listed
  as ones that a CPA should be knowledgeable
• Education Requirements for CPA Candidates Only
  five states require that CPA candidates have
  completed any formal course work in government
  accounting and only seven require a mix of
  courses of which government classes may be a
  part.

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Critical Gaps in Accounting Education (contd.)

• Availability of Government Accounting Course is
  Limited The availability of government
  accounting courses at our colleges and
  Universities is very limited. The best
  information on the paucity of the government
  offerings is a survey of the Accounting
  Departments of all the Association of Collegiate
  Schools of Business which found that of 487
  responding schools only 313 or 64 had any
  course in government accounting and of these
  schools, the vast majority only had between one
  and three class offerings in government
  accounting.
• Faculty is not Being Developed in the Government
  Area The latest data on the number of PhDs in
  Government accounting has shown a precipitous
  decline in the number of new PhDs qualified to
  teach Government accounting. In the period of
  2001 to 2005 there were fewer than 10 government
  accounting dissertation completions each year and
  only 2 in 2005.
• Discussions I had with current practitioners
  indicate that the decline has likely gotten worse
  since then

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Critical Gaps in Accounting Education-Impact

• CPAs in America are entering the profession with
  little or no knowledge of government accounting
• In Federal Accounting , CPAs have a knowledge
  level the same as a layman.
• At a general level - For the larger group of
  students who dont necessarily want to pursue
  public accounting careers, or who only want to
  take a course or two to understand government
  accounting issues, the offerings at our colleges
  are not available or are sparse. It is fair so
  say that government accounting is largely un-
  taught at our higher educational institutions.
• It is probable that today the average CPA
  practitioner will have never taken a government
  accounting class and will have only a rudimentary
  knowledge of the government and fund accounting
  used by our state and local governments.

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Critical gaps in Accounting Education-Impact

• The Public needs to know and understand
  Government Finances The United States has over
  90,000 state and local governments and over 24
  million individuals are employed in federal,
  state and local governments in the United States
  The United States Department of Education has a
  near trillion dollar balance sheet. Many federal
  agencies are bigger than the largest Fortune 500
  companies.
• Government is Important and the problems of
  fiscal sustainability for the key programs the
  entire nation relies upon such as social
  security, and Medicare affect every citizen and
  cannot be addressed properly when there is not an
  educated professional workforce .

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Critical Gaps in Accounting Education-What Can be
Done

• Government accounting education must be augmented
  and improved.
• The CGFM certification must be expanded and
  actively promoted by our universities and by
  governments themselves to close the gap in our
  accounting professionals education, and to
  address the gaps in the CPA examinations
  content and education requirements.
• All of us in the profession need to lobby the
  university community to add government accounting
  programs to the accounting curriculum and to
  expand the menu of classes and programs.

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Critical Gaps in Accounting Education-What Can be
Done

• The late British Prime Minister Benjamin Disraeli
  once said Upon the education of the people of
  this country, the fate of this country depends.
• I would like to paraphrase him and state my view
  of the Untied States fiscal reality of today
  When the largely unfunded liabilities of the
  federal government exceed over 20 trillion
  dollars and are rising each year, upon the
  education of the accountants of the country, the
  fate of the country depends. We, at AGA need to
  make it our mission to expand government
  accounting education.

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Key Issues in Government Accountability

• NEED to Address Human Capital Issues

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Human Capital Issues

• Attended Association Summit in December (AICPA,
  IIA, AAA, AGA, FEI and IMA) and there are many
  current human capital issues
• The Public Accounting profession is experiencing
  turnover to other areas outside of
  accounting/financial management particularly at
  the two to five area experience level.
  Competition at entry level has increased
• Womens participation in accounting majors has
  declined inexplicably the last two years
• Foreign enrollment in U.S Universities and
  Accounting programs is declining
• Accounting needs to be classified as a STEM
  (Science, Technology, Engineering and Mathematics
  ) discipline to help keep international students
  graduating in the United States when they pursue
  their careers. This is a major AICPA initiative.
• At federal level less than 7 of workforces is
  under age 30. Government can often recruit
  personnel in other areas more easily than in
  finance. Who will replace the current pool ?

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How AGA Can Help Your Career

• You dont succeed in anything without passion to
  achieve-industriousness and enthusiasm are the
  cornerstones of success.
• Little things make big things happen so try to
  make each day your masterpiece
• You dont advance in career without improving
  your knowledge and skills
• AGA is where you can obtain that knowledge and
  those skills. AGA is where the leaders in
  government accountability go to think, and
  exchange ideas
• Questions?