OFFICE OF THE CHIEF FINANCIAL AND CHIEF INFORMATION OFFICER
THE CHIEF FINANCIAL AND CHIEF INFORMATION OFFICER
July 21, 1998
I am really very pleased to be able to tell you that for the first time in the history of the Department of Education, we have received an unqualified opinion from our auditors that our financial statements are fairly presented. This is a tribute to all those throughout the Department involved in its Financial Management, including those in Budget Service, who are responsible for the development of our reserve for losses on student loans. The student loan reserve calculation has, in the past, been the major hurdle in our effort to obtain a clean opinion, which we have now achieved.
This success, however noteworthy, is only the first giant step in our effort to improve financial management. As described in detail in this report, our own internal self assessment required under the Federal Managers' Financial Integrity Act, and the internal control report from our auditors, indicate a number of material weaknesses in financial and other management controls. We are deeply committed to their correction.
This Accountability Report is prepared as part of the Government Management and Reform Act pilot program and will be evaluated by peer agencies in an effort to develop uniform consolidated reporting on a government-wide basis. The report provides an analysis of the Department's financial management and financial performance for the fiscal year which ended September 30, 1997. It includes a discussion of the Strategic Plan goals and objectives which relate to financial management, the results of the Department-wide audit, the auditors' reports, and a summary of other financial reporting requirements.
The Chief Financial Officers Act (CFO Act) of 1990 was enacted to improve the financial management of the federal government and to ensure the production of reliable and timely financial information for use in the management and evaluation of federal programs. The Government Management and Reform Act (GMRA) of 1994 furthered the objectives of the CFO Act by requiring all federal agencies to prepare and publish Department-wide annual financial reports, beginning with fiscal year 1996. GMRA authorized the Office of Management and Budget (OMB) to implement a pilot program to streamline and consolidate certain statutory financial management and performance reports into a single, annual Accountability Report. Additionally, both the Government Performance and Results Act (GPRA), which requires a Department strategic plan with goals and objectives, and the Clinger-Cohen Act (CCA), which requires information systems and business work processes to conform to the strategic plan, have added a sharper focus to the Department's mission to enhance financial management information.
The Department recognizes the importance of public disclosure and accountability. We believe this report is a demonstration of our commitment to fulfill the financial management requirements of these Acts.