Presentation for House Subcommittee on Administrative Efficiency
This presentation, conducted on June 7, 2021, by Acting Director James Thorsen and State Controller Peter Keenan, CPA, from the Dept. of Administration, Office of Accounts and Control, offers insights and updates on administrative efficiency strategies and initiatives. The content highlights the department's ongoing efforts to streamline operations and enhance efficiency in managing accounts and controls. Through this presentation, key stakeholders gain valuable information and perspectives on optimizing administrative processes to achieve greater effectiveness and productivity.
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Presentation Transcript
Dept. of Administration-Office of Accounts and Control Presentation for the House Subcommittee on Administrative Efficiency Acting Director Department of Administration James Thorsen State Controller Peter Keenan, CPA June 7, 2021
Agenda Office Overview Office Overview Mission, Functions, Goals Mission, Functions, Goals Challenges or Obstacles Challenges or Obstacles Best Practices Best Practices Questions Questions- -Ask at any time Ask at any time 2 Office of Accounts and Control
High Level Overview- Office of Accounts and Control Accounts and Control FY 2021 Appropriation: General Revenue $4.795 million, Federal $347,000, Restricted $140,000 Accounts Payable (Audit of Payments) Grants Management Payroll Finance Regulatory Reporting (IRS and State) Fixed Asset Control Internal Control Financial Reporting Accounting 4 Office of Accounts and Control
Organizational Chart Controller Peter Keenan, CPA Grants Management Associate Director Laurie Petrone Associate Controller Accounts Payable Louise Sawtelle Associate Controller Finance Margaret Carlson, CPA Chief Implementation Aide Deborah Poirier Associate Controller Payroll Carol Lincoln INTERNAL CONTROL Administrator, Financial Management Gail LaPoint FINANCIAL REPORTING Financial Reporting Manager Ben Quattrucci Interdepartmental Project Manager Steven Thompson ACCOUNTS PAYABLE PAYROLL Supervisor of Fiscal Services Nelia Coelho Chief Preaudit Supervisor Malcom Varadian Supervisor of Fiscal Services Linda Costa Supervisor of Fiscal Services Natalie Lester FIXED ASSET CONTROL FINANCIAL REPORTING RIFANS Administrator Sandra Morgan Interdepartmental Project Manager Laura Sullivan ACCOUNTING Administrator, Financial Management Marti Hernandez Supervisor of Fiscal Services Steve Blazer Supervising Accountant Vacant MAIL ROOM Data Control Clerk Maria Ducharme Centralized Accounting Specialists Supervising Preaudit Officer Bruilda Larios Supervising Preaudit Officer Joanne Silva Programming Services Officer Brianna Murphy Accounting Control Specialists Patricia Paolino, LuAnn Gallo, Jackie Kind Asset Protection Officer Charles Mally Supervisor Financial Mgt & Reporting Susan DeStefanis Centralized Accounting Specialists Centralized Accounting Specialists John Monse, Ken Casale, Vacant Chantha Danella, Rossy Jaquay, Roberta Coccia, Carmen Nieves, Vacant Supervising Accountant Michelle Goncalo Susan Baldassare, Maureen Kelley, Donna Mandeville 5 Office of Accounts and Control
Mission/Key Responsibilities/Customers The office s mission is to promote financial integrity and accountability through 1) sound fiscal policies/procedures, 2) effective internal controls and 3) state of the art software applications. Key responsibilities Key responsibilities include: preparing and distributing timely and accurate information about the State s fiscal operations to the General Assembly, citizens, management and investors; reviewing and approving all payments to be made by the General Treasurer to the State s suppliers and employees (payroll and related taxes, benefit costs); developing policies and procedures to safeguard the State s assets and ensure grants are managed effectively Customers include: Customers include: For financial information; the General Assembly, citizens, investors, management For payments: suppliers, grantees, municipalities, others (e.g. foster parents) and employees 7 Office of Accounts and Control
Key Function: Manage RIFANS General Ledger Software Part of a suite of applications from Oracle Corporation that includes Accounts Payable, Fixed Assets and Accounts Receivable modules installed in 2006 Used by all state agencies/the 3 branches of state government For budgetary control, RIFANS utilizes a uniform account structure that mirrors the Appropriation Act that the General Assembly enacts each year In FY2020 over 50,000 journal entries were processed in RIFANS/approximately 300 users of RIFANS state-wide 8 Office of Accounts and Control
Key Function: Financial Reporting Some of the reports the Office prepares include: State s Annual Comprehensive Financial Report (ACFR): Required by Generally Accepted Accounting Principles (GAAP) Audited by the Auditor General Consistently earn GFOA Certificate of Achievement for the ACFR Preliminary and final fiscal closing reports per RI G.L. 35-6-1 (10) Monthly revenue reports and quarterly expenditure reports RIFANS also includes a host of standard reports and queries that users across state government can produce as needed 9 Office of Accounts and Control
Key Function: Audit All Payments RIFANS is the primary source for all payments to the State s suppliers, vendors, and municipalities. Over 99% of payments are made in fewer than 30 days In FY2020 over 262,000 payments totaling $6.1 billion were made using RIFANS Per state law, staff pre-audits all payments to ensure: Compliance with law Proper supporting documentation present Proper approval (documented via an electronic hierarchy) New Purchasing software Ocean State Procures - will be rolled out in near future 10 Office of Accounts and Control
Key Function: Process State Employee Payroll About 15,400 state employees are paid each pay period (including employees of URI, RIC, and CCRI) Virtually all employees receive direct deposit Payroll processing is done jointly with Human Resources HR enters attendance data and establishes rates of pay The office pre-audits all payments and manages all deductions for taxes, benefits, union dues, pension plans etc. The HR and payroll software, unlike RIFANS, is internally developed COBOL software dating back over 30 years The HR and payroll software, unlike RIFANS, is internally developed COBOL software dating back over 30 years HR and payroll software is not integrated HR and payroll software is not integrated information requires duplicate entry from paper documents, information requires duplicate entry from paper documents, processes are inefficient and prone to error processes are inefficient and prone to error We also maintain the Pay Stub RI employee portal and prepare all federal and state payroll tax filings 11 Office of Accounts and Control
Key Function: Grants Management Mission has been transformed since pandemic to focus more on federal compliance and reporting. Its ongoing functions include: Standardizing, streamlining, and improving grants business process Establish statewide grants management policies and procedures Procure, implement, and maintain shared technology (grants management system) that supports the standard business process, policies, and procedures and reduces administrative burden and improves program outcomes Training and technical assistance to state agency CFOs, state agency fiscal staff, programmatic grant staff, and community-based sub-recipients Provide timely and accurate award information to stakeholders and the public In FY2020, the state spent approximately $4.5 billion in federal funds 12 Office of Accounts and Control
Goals Please note: The first goal below is the foundation for ensuring the other goals continue to be achieved Implement state-of-the-art ERP software that provides increased internal control, efficiency, and real-time information Timely and accurate financial information for the General Assembly, taxpayers, managers, and investors Electronic processing of all transactions (eliminate paper documents, such as timesheets) Prompt and accurate payment to all suppliers, municipalities, and employees 13 Office of Accounts and Control
Challenges/Obstacles By far, the most significant obstacle the office faces is outdated software, particularly in the mission-critical Payroll, Time & Attendance, and Human Resource areas Existing software is from the 1980s: Written in COBOL Mainframe based Different but related modules are not integrated (e.g. Human Resources and Payroll) In the last year, there have been many modifications to the software as a result of federal pandemic-related laws Accounts payable software, which was implemented in 2006, is also showing its age 15 Office of Accounts and Control
More Information about Challenges/Obstacles The current software exposes the State to risk of critical business process failure A few examples of the possible negative impacts of such a failure: Inability to pay employees or vendors on a timely basis Diversion of payments to unauthorized recipients Because current systems are paper dependent they are inefficient and error prone Implementation of a cloud-based ERP product would address these issues, making our processes far more efficient, and greatly increasing the amount of information available to manage the State s operations Other considerations: The Auditor General highlighted the need for an ERP in his April 2021 audit report (and the prior several reports) http://www.oag.ri.gov/reports/2020_FinStmt_FindingsMC.pdf Over 40 states have an ERP The products are cloud based, off the shelf, and configurable The blueprint for the ERP - the Strategic Plan was completed in January 2020 after a six-month collaborative process 16 Office of Accounts and Control
Improving Performance and Establishing Best Practices The office regularly networks with the controllers of other states to share best practices and craft solutions to common challenges For example, recently the office encountered some control concerns in its automated payment processes. We reached out to several states which had experienced similar issues in order to assist in developing a solution Implementation of the ERP software will promote use of best practices as it will shape our future business processes and internal controls 18 Office of Accounts and Control
