Shared services providers favored for financial work

Agencies are increasingly choosing contractors as shared service providers for their modernized financial management systems over federal agencies that provide the same services. The first three large agencies to move to a shared service provider under the Financial Management Line of Business have selected contractors.

In the latest example, the Labor Department awarded a $50.4 million contract to Global Computer Enterprises on June 26 to develop and host a core financial management system to replace its mainframe accounting system. The vendor will implement Oracle Federal Financial software for the department, by Oct. 1, the agency said in its posting on the Federal Business Opportunities Web site. The contract will last up to nine years, starting with a one-year base period.

Agencies must use a public or private shared-services provider when they upgrade their financial management systems under the Office of Management and Budget's Financial Management Line of Business consolidation initiative.

Meanwhile, two other agencies have chosen contractors to upgrade their financial systems over the federal agencies that act as shared service providers. The Environmental Protection Agency upheld its choice of CGI Federal in April to host its financial management software, after IBM protested the original award in February 2007. The Agriculture Department selected Accenture in September to modernize its financial systems.

The four agencies that provide financial management shared services are the Treasury Department's Bureau of Public Debt, the Interior Department's National Business Center, the Transportation Department and the General Services Administration.

Labor said it followed OMB's guidance for a competitive framework for the financial management effort and migration planning from GSA's Financial Systems Integration Office.

The modernized financial management system and associated business processes are expected to improve functional integration, usability of Web-based user interfaces, access to up-to-date data and reports and accountability and ability to audit transactions, Labor said.

Labor's current financial management functions, processes and activities are distributed across multiple information systems and financial applications, all centered on the Department of Labor Accounting and Related Systems, or DOLAR$, mainframe accounting system, the department said. Labor awarded a contract in 2006 to Mythics for financial management but let it expire without picking up its options, the department said.

Mary Mosquera writes for Government Computer News and Federal Computer Week, 1105 Government Information Group publications.