Bush mandates direct financial apps spending

Recent developments in financial software for government are closely tracking directives that emphasize lines of business, strategic plans and project portfolios. Not only is the Office of Management and Budget steering agencies toward four centers of excellence as shared financial service providers, but also plenty of other organizations are upgrading their core financial platforms.

The trend is to look at agency financials from the highest levels, using software add-ons that help align expenditures with business missions.

With as many as 13 federal agencies procuring core financial management systems, according to a survey by the Financial Systems Integration Office, it's critical that new software capabilities help them fulfill their missions.

The market for core financial applications has changed over the last few years. SAP AG and Oracle Corp. dominate the federal market. SAP's long experience in enterprise resource planning has made it a favorite of logistics-intensive agencies, such as the Defense Department.

CGI-AMS of Fairfax, Va., continues to offer its AMS Momentum financial software, which is running at the General Services Administration, Office of Personnel Management and State Department, according to FSIO.

AMS has phased out its Federal Financial System software, still in use at the Agriculture and Interior departments. In 2003, it allowed the software's Joint Financial Management Improvement Program certification to lapse. The company's newer AMS Advantage Web-based suite has been implemented by several state and local agencies.

Lawson Software Inc. of St. Paul, Minn., and to a lesser degree Microsoft Corp.'s Business Solutions with its Great Plains and Solomon lines, also focus on state and local users. Lawson said it also has pockets of customers in both houses of Congress and in three-letter agencies it wouldn't name.

These financial software developers are trying to add a layer of intelligence to their applications. Business analytics usually require a data warehouse that gathers financial information from disparate systems, and makes it easily searched and statistically analyzed. ERP vendors are emphasizing and enhancing their database technology or adding new support for third-party data warehouses and related tools.

The idea is to provide users with a more unified view of all of an agency's resources, and apply analytical tools that help agency users make more informed decisions.

Apps get asset management

Vendors also report increased interest in using financial packages for asset management. Lawson's acquisition this year of Swedish ERP vendor Intentia International AB is an indication of the trend's importance.

Intentia's Enterprise Management Applications suite tracks assets and integrates with the company's supply-chain management and other software. Intentia also has integrated radio frequency identification technology into its products.

GASB 42, or Government Accounting Standards Board Statement 42, is an important new standard. It specifies how to handle "impaired" ? depreciated ? physical assets and could help state and local agencies with their asset-rich public works and transportation departments to save money.

More government agencies are asking for software that supports the Sarbanes-Oxley Act of 2002, even though its accountability rules were meant to apply only to corporations.

In light of the evolving market for financial applications, experts advised financial software buyers to put greater value on a package's ability to support the organization's underlying business processes than on the technology.

The Financial Systems Integration Office, just as the Joint Financial Management Improvement Program before it, tests core financial platforms for conformance to government standards, specifically OMB Circular A-127, which requires agencies to build and maintain a single, integrated financial management system. The document also directs agencies to choose commercial programs when upgrading financial systems.

As the Financial Systems Integration Office and the Joint Financial Management Improvement Program view it, financial application upgrades fall into one of two categories: core applications and feeder applications. Many agencies are looking into new core systems, and at least 22 are looking to add feeder modules to handle functions such as grants and property management.

David Essex is a freelance technology writer in Antrim, N.H.

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