Financial Management: Profile of Navy and Marine Corps Financial Managers
(Letter Report, 04/15/98, GAO/AIMD-98-86).

Pursuant to a legislative requirement, GAO provided information on the
qualifications and experience of the Department of Defense's (DOD)
financial management workforce, focusing on the Navy's and the Marine
Corps' key financial managers.

GAO noted that: (1) the four Navy financial management executives
included in this review are the Assistant Secretary of the Navy, the
Principal Deputy Assistant Secretary of the Navy, the Director, Office
of Financial Operations; and the Director, Office of Budget; (2) each of
the executives had attained bachelor's degrees and three of the four
executives also held master's degrees; (3) the Assistant Secretary had
spent 27 years at DOD and 5 years in the private sector; (4) the other
three executives had DOD careers ranging from 23 to 32 years, with two
of these executives also spending part of their careers in another
government agency or the private sector; (5) about 23 percent were
military officers, serving mainly as comptrollers at major commands and
installations, and 77 percent were civilian personnel serving mainly in
comptroller and budget officer positions at installations; (6) all 44
officers and 122 of the 150 civilians reported holding bachelor's
degrees, with 5 of these respondents reporting more than one major; (7)
about 28 percent of these 166 managers majored in accounting, while
approximately 43 percent reported degrees in business-related majors
other than accounting; (8) eighty respondents also reported holding
master's degrees, with 8 of these respondents reporting more than one
major; (9) six of these 80 managers held master's degrees in accounting,
while about 78 percent reported degrees in business-related majors other
than accounting; (10) the officers' careers ranged from 4 to 33 years
while civilians' careers ranged from 8 to 55 years; (11) 166 respondents
reported completing training in one or more of the categories included
in GAO's review during 1995 and 1996; (12) about 22 percent of the 94
respondents reported holding one or more professional certifications;
and (13) the 42 managers in this group reported holding accounting and
other financial-related certifications.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  AIMD-98-86
     TITLE:  Financial Management: Profile of Navy and Marine Corps 
             Financial Managers
      DATE:  04/15/98
   SUBJECT:  Financial management
             Education or training
             Civilian employees
             Accountants
             Chief financial officers
             Military officers
             Accounting
             Naval personnel
             Human resources training
IDENTIFIER:  JFMIP
             Joint Financial Management Improvement Program
             
******************************************************************
** This file contains an ASCII representation of the text of a  **
** GAO report.  Delineations within the text indicating chapter **
** titles, headings, and bullets are preserved.  Major          **
** divisions and subdivisions of the text, such as Chapters,    **
** Sections, and Appendixes, are identified by double and       **
** single lines.  The numbers on the right end of these lines   **
** indicate the position of each of the subsections in the      **
** document outline.  These numbers do NOT correspond with the  **
** page numbers of the printed product.                         **
**                                                              **
** No attempt has been made to display graphic images, although **
** figure captions are reproduced.  Tables are included, but    **
** may not resemble those in the printed version.               **
**                                                              **
** Please see the PDF (Portable Document Format) file, when     **
** available, for a complete electronic file of the printed     **
** document's contents.                                         **
**                                                              **
** A printed copy of this report may be obtained from the GAO   **
** Document Distribution Center.  For further details, please   **
** send an e-mail message to:                                   **
**                                                              **
**                                            **
**                                                              **
** with the message 'info' in the body.                         **
******************************************************************


Cover
================================================================ COVER


Report to the Acting Assistant Secretary of the Navy (Financial
Management and Comptroller)

April 1998

FINANCIAL MANAGEMENT - PROFILE OF
NAVY AND MARINE CORPS FINANCIAL
MANAGERS

GAO/AIMD-98-86

Profile of Navy and Marine Corps Financial Managers

(918911)


Abbreviations
=============================================================== ABBREV

  ASN/FM&C - Assistant Secretary of the Navy (Financial Management
     and Comptroller)
  CNET - Chief of Naval Education and Training
  CGFM - Certified Government Financial Manager
  CPA - Certified Public Accountant
  CFO - Chief Financial Officer
  DFAS - Defense Finance and Accounting Service
  DOD - Department of Defense
  FMFIA - Federal Managers Financial Integrity Act
  GMRA - Government Management Reform Act
  GPRA - Government Performance and Results Act
  JFMIP - Joint Financial Management Improvement Program
  MSC - Military Sealift Command
  NFMC - Nonfinancial Management Certifications
  O&M - Operation and Maintenance
  OFMC - Other Financial Management Certifications
  RDT&E - Research, Development, Test, and Evaluation

Letter
=============================================================== LETTER


B-279264

April 15, 1998

Ms.  Gladys J.  Commons
Acting Assistant Secretary of the Navy
 (Financial Management and Comptroller)

Dear Ms.  Commons: 

As highlighted in our February 1997 high-risk series report,\1 one of
the greatest challenges to improving financial management throughout
the Department of Defense (DOD) is establishing a well-qualified,
professional financial management workforce.  Our objective in a
series of assignments is to provide information on qualifications,
such as formal education, training, and professional certifications,
and professional work experience of personnel serving in key
financial management positions in DOD.  Due to concerns on the part
of DOD officials regarding the completeness of personnel databases
and personnel files, we are obtaining this information from
biographies and/or profile instruments provided by each manager. 

This is the fourth of our planned reports on the qualifications and
experience of DOD's financial management workforce.  It contains
information we obtained on key financial managers in the Department
of the Navy.  We have already issued reports on key financial
managers within the Office of the Under Secretary of Defense
(Comptroller)\2 and the Departments of the Air Force\3 and Army.\4
Also, we plan to issue a report on the Defense Finance and Accounting
Service.  As agreed with DOD officials, our reviews are confined to
key financial management positions.  These positions most often
include comptrollers, deputy comptrollers, and budget officers at
major commands and installations.  These reports can help Defense
agencies in shaping their plans to enhance the qualifications and
work experience, such as formal education and training, of their
financial management workforce, as necessary.  In addition, the
reports provide baseline information that can be helpful in
monitoring progress.  Our final report in this series will discuss
the qualifications and professional work experience of personnel
serving in key financial management positions across DOD relative to
those in private sector companies and large state governments.  We
will also identify those steps DOD has taken and others it should
consider implementing to enhance its financial management workforce
to fully meet the objectives of the Chief Financial Officers (CFO)
Act. 

This report provides qualification and professional work experience
information on 4 Navy financial management executives and 194 of 306
key financial managers representing 90 of the 126 Navy and Marine
Corps organizations included in our review. 


--------------------
\1 High-Risk Series:  Defense Financial Management (GAO/HR-97-3,
February 1997). 

\2 Financial Management:  Profile of DOD Comptroller/CFO Financial
Managers (GAO/AIMD-97-97,
June 27, 1997). 

\3 Financial Management:  Profile of Air Force Financial Managers
(GAO/AIMD-98-4, November 26, 1997). 

\4 Financial Management:  Profile of Army Financial Managers
(GAO/AIMD-98-58, February 25, 1998). 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

The four Navy financial management executives included in this review
are the Assistant Secretary of the Navy (Financial Management and
Comptroller); the Principal Deputy Assistant Secretary of the Navy
(Financial Management and Comptroller); the Director, Office of
Financial Operations; and the Director, Office of Budget.  Each of
the executives had attained bachelor's degrees and three of the four
executives also held master's degrees.  The Assistant Secretary had
spent 27 years at DOD and 5 years in the private sector.  The other
three executives had DOD careers ranging from 23 to 32 years, with
two of these executives also spending part of their careers in
another government agency or the private sector.  One of the
executives held a professional certification. 

Of the 194 other key Navy and Marine Corps financial managers
responding to our review: 

  -- About 23 percent (44) were military officers, serving mainly as
     comptrollers at major commands and installations, and 77 percent
     (150) were civilian personnel serving mainly in comptroller and
     budget officer positions at installations. 

  -- All 44 officers and 122 of the 150 civilians reported holding
     bachelor's degrees, with 5 of these respondents reporting more
     than one major.  About 28 percent of these 166 managers majored
     in accounting, while approximately 43 percent reported degrees
     in business-related majors other than accounting. 

  -- Eighty respondents (39 officers and 41 civilians) also reported
     holding master's degrees, with 8 of these respondents reporting
     more than one major.  Six of these 80 managers held master's
     degrees in accounting, while about 78 percent reported degrees
     in business-related majors other than accounting. 

  -- The officers' careers ranged from 4 to 33 years, averaging 21
     years, while the civilians' careers ranged from 8 to 55 years,
     averaging 27 years.  About 62 percent of all respondents,
     officers and civilians, reported performing several financial
     management-related functions included in our review throughout
     their careers. 

  -- One-hundred-sixty respondents (28 officers and 132 civilians)
     reported completing training (referred to as continuing
     professional education in the profile instrument) in one or more
     of the categories included in our review during 1995 and 1996. 
     Of these 160 managers, (1) about 94 percent listed general
     topics, such as computers, supervision, strategic planning, and
     communication skills, as examples of the training completed, (2)
     61 percent reported completing financial-related training, and
     (3) about 44 percent reported completing accounting-related
     training, such as accounting standards and financial reporting. 

  -- About 22 percent of the 194 respondents reported holding one or
     more professional certifications.  The 42 managers in this group
     reported holding accounting and other financial
     management-related certifications, as follows:  13 were
     Certified Public Accountants (CPA),\5 23 were Certified
     Government Financial Managers (CGFM),\6 and 9 held other
     certifications, including the Certified Management Accountant
     and Certified Fraud Examiner. 


--------------------
\5 The CPA certification program has existed since 1917.  State
organizations administer this program, awarding the certificate based
on the applicant's formal education, professional work experience,
and successful completion of a comprehensive examination developed by
the American Institute of Certified Public Accountants. 

\6 The CGFM program was initiated by the Association of Government
Accountants in July 1994.  Until June 30, 1996, the certificate was
awarded based on an evaluation of an applicant's formal education and
professional work experience in government financial management. 
Since then, certifications have also required the successful
completion of three comprehensive examinations covering (1) the
governmental environment, (2) governmental accounting, financial
reporting, and budgeting, and (3) governmental financial management
and control. 


   REQUIREMENTS FOR FINANCIAL
   MANAGERS
------------------------------------------------------------ Letter :2

The CFO Act of 1990 was enacted to address longstanding problems in
financial management in the federal government.  The act established
CFO positions throughout the federal government and mandated that,
within each of the largest federal departments and agencies, the CFO
oversee all financial management activities relating to the programs
and operations of the agency.  Among the key responsibilities of CFOs
are overseeing the recruitment, selection, and training of personnel
to carry out agency financial management functions. 

Recognizing that a qualified workforce was fundamental to achieving
the objectives of the CFO Act and other related management reform
legislation aimed at improving federal financial management, the
Human Resources Committee of the Chief Financial Officers Council and
the Joint Financial Management Improvement Program (JFMIP)\7 have
proposed improvements addressing the recruitment, training,
retention, and performance of federal financial management personnel. 
In November 1995, JFMIP published the Framework for Core Competencies
for Financial Management Personnel in the Federal Government,\8
designed to highlight the knowledge, skills, and abilities that
accountants, budget analysts, and other financial managers in the
federal government should possess or develop to perform their
functions effectively in accordance with the CFO Act.  JFMIP stressed
the need for federal government financial managers to be
well-equipped to contribute to financial management activities, such
as the execution of budgets under increasingly constrained resource
caps and the preparation, analysis, and interpretation of
consolidated financial statements. 

A primary goal in this body of work is to obtain and share with DOD
information on the formal education, professional work experience,
training, and professional certifications of key financial managers
in the department, including the Office of the Under Secretary of
Defense (Comptroller), each of the military services, and the Defense
Finance and Accounting Service. 


--------------------
\7 JFMIP is a joint and cooperative undertaking of the Office of
Management and Budget, General Accounting Office, Department of the
Treasury, and Office of Personnel Management to improve and
coordinate financial management policies and practices throughout the
government. 

\8 Framework for Core Competencies for Financial Management Personnel
in the Federal Government, a joint project of the Human Resources
Committee of the Chief Financial Officers Council and the Joint
Financial Management Improvement Program, November 1995. 


   OBJECTIVE, SCOPE, AND
   METHODOLOGY
------------------------------------------------------------ Letter :3

The objective of this assignment is to provide information on the
formal education, professional work experience, training, and
professional certifications of personnel serving in key financial
management positions in the Navy and Marine Corps.  We obtained this
information from biographies and profile instruments due to the
concerns of Navy officials regarding the completeness of personnel
databases and personnel files.  We worked with Navy officials to
determine the key financial management positions to be included in
this review.  These positions typically included comptrollers, deputy
comptrollers, and budget officers at Navy and Marine Corps major
commands and installations.  As agreed with the Navy, we did not
verify the information contained in the profiles provided by the
respondents.  A more detailed discussion of our scope and
methodology, including a description of how we obtained
qualifications and work experience data, is in appendix I. 

We performed our audit work from March 1997 through January 1998 in
accordance with generally accepted government auditing standards. 
The Assistant Secretary of the Navy (Financial Management and
Comptroller) provided comments on a draft of this report.  These
comments are discussed in the "Agency Comments and Our Evaluation"
section of this report and are reprinted in appendix VIII. 


   PROFILE OF NAVY FINANCIAL
   MANAGEMENT EXECUTIVES
------------------------------------------------------------ Letter :4

Table 1 provides information on the formal education, careers, and
professional certifications of the Department of the Navy's four
executives included in our review.  All four held bachelor's degrees
and three also held master's degrees.  Majors associated with their
bachelor's degrees included mathematics, education, accounting, and
engineering, while those associated with their master's degrees
included public financial management, business administration,
operations research, and Middle East Affairs and Arabic.  The
Assistant Secretary had spent 27 years at DOD and 5 years in the
private sector.  The other three executives' DOD careers ranged from
23 to 32 years.  In addition to her years at DOD, the Principal
Deputy Assistant Secretary had spent 2 years at the Social Security
Administration.  The Director of the Office of Financial Operations
had spent 2 years in the private sector and as an adjunct professor;
he had also served as a part-time instructor of graduate and
undergraduate level accounting and financial management courses over
a 10-year period.  A review of biographical information provided to
us showed that three of the executives had served in financial
management-related positions during most of their DOD careers.  One
of the executives also held a professional certification.  The
Director, Office of Financial Operations was a Certified Public
Accountant. 



                                Table 1
                
                  Profile of Navy Financial Management
                               Executives

----------------------------------------  ----------------------------
Assistant Secretary of the Navy (Financial Management and Comptroller
----------------------------------------------------------------------
Formal Education                          Bachelor's Degree in
                                          Mathematics

Career                                    DOD -27 years; private
                                          sector -5 years

Certifications                            None


Principal Deputy Assistant Secretary of the Navy (Financial Manag
Comptroller)
----------------------------------------------------------------------
Formal Education                          Bachelor's Degree in
                                          Education
                                          Master's Degree in Public
                                          Financial Management

Career                                    DOD -26 years; other federal
                                          government -2 years

Certifications                            None


Director, Office of Financial Operations
----------------------------------------------------------------------
Formal Education                          Bachelor's Degree in
                                          Accounting
                                          Master's Degree in Business
                                          Administration

Career                                    DOD -23 years; private
                                          sector -2 years; adjunct
                                          professor of accounting and
                                          financial management -10-
                                          year period (part time)

Certifications                            Certified Public Accountant


Director, Office of Budget
----------------------------------------------------------------------
Formal Education                          Bachelor's Degree in
                                          Engineering
                                          Master's Degree in
                                          Operations Research
                                          Master's Degree in Middle
                                          East Affairs and Arabic

Career                                    DOD -32 years

Certifications                            None
----------------------------------------------------------------------

   PROFILE OF NAVY AND MARINE
   CORPS KEY FINANCIAL MANAGERS
------------------------------------------------------------ Letter :5

In collaboration with Navy officials, we identified 306 key financial
managers across the department for this review, of which 194 (or 63
percent) responded by providing information on their qualifications
and experience.  Respondents included

  -- the 7 managers from the Office of the Assistant Secretary of the
     Navy (Financial Management and Comptroller)--ASN/FM&C

  -- 74 of 128 managers from four Navy operational commands and their
     installations;

  -- 12 of 17 managers from the Chief of Naval Education and Training
     (CNET) and its installations;

  -- 68 of 110 managers from the Naval Sea Systems Command, Naval Air
     Systems Command, Naval Supply Systems Command, and Naval
     Facilities Engineering Command and (1) shipyards, weapon
     stations, aviation depots, fleet industrial supply centers, and
     public work centers which perform supply and maintenance support
     to other Navy and Marine Corps organizations on a reimbursable
     basis and (2) air and surface warfare centers responsible for
     the research, development, test, and evaluation (RDT&E) and
     procurement of Navy aeronautical, electronics, ship, and
     submarine systems; and

  -- 33 of 44 managers from Headquarters, U.S.  Marine Corps and its
     commands and installations. 

The seven ASN/FM&C respondents performed roles including financial
operations, financial management/accounting policy, and/or budget
execution.  The 187 respondents from Navy and Marine Corps major
commands and installations included 71 comptrollers, 47 deputy
comptrollers, 67 budget officers, and 2 working capital fund\9
managers. 

About 23 percent of the 194 respondents were military officers.  The
44 officers served mainly as comptrollers at major commands and
installations, and the 150 civilians served most often as
comptrollers and budget officers at installations.  Table 2 provides
a breakout of the officers and civilians by rank and grade,
respectively. 



                                Table 2
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank\a                      Number  Grade                       Number
------------------------  --------  ------------------------  --------
Rear Admiral/Brigadier           0  Senior Executive                12
 General (O-7)
Captain/Colonel (O-6)           14  15                              28
Commander/Lieutenant            17  14                              31
 Colonel (O-5)
Lieutenant Commander/            8  13                              38
 Major (O-4)
Lieutenant/Captain (O-           5  12                              35
 3)
Lieutenant (Junior               0  11                               6
 Grade)/First Lieutenant
 (O-2)
======================================================================
Total                           44  Total                          150
----------------------------------------------------------------------
\a The first rank shown relates to Navy officers, while the second
relates to Marine Corps officers. 


--------------------
\9 Working capital fund activities sell goods and services to the
military services and defense agencies with a goal of operating on a
break-even basis.  Customers generally reimburse these activities
from their operation and maintenance or other appropriated fund
accounts. 


      FORMAL EDUCATION ATTAINED
---------------------------------------------------------- Letter :5.1

Over 85 percent (the 44 officers and 122 of 150 civilians) of the 194
respondents reported holding bachelor's degrees, and 41 percent (39
officers and 41 civilians) also reported holding master's degrees. 

Five of the 166 respondents holding bachelor's degrees reported more
than one major.  A review of the profiles showed that 47 managers, or
about 28 percent of these respondents, reported accounting majors, 73
managers reported other business-related majors, and 48 managers
reported that one or more of their majors were not business related. 
Table 3 shows the bachelor's degree majors reported by the 166 Navy
and Marine Corps financial managers. 



                                Table 3
                
                  Bachelor's Degree Majors Reported by
                Navy and Marine Corps Financial Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             4             43             47
Other business                        22             51             73
Nonbusiness                           19             32             51
======================================================================
Total degrees                         45            126            171
----------------------------------------------------------------------
Eight of the 80 respondents holding master's degrees reported more
than one major.  A review of the profiles showed that, of these 80
managers, 6 reported accounting majors, 62 reported one or more other
business-related majors, and 15 reported one or more
nonbusiness-related majors.  Table 4 shows the master's degree majors
reported by the 80 respondents. 



                                Table 4
                
                Master's Degree Majors Reported by Navy
                  and Marine Corps Financial Managers

                                Number of master's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             2              4              6
Other business                        37             29             66
Nonbusiness                            7              9             16
======================================================================
Total degrees                         46             42             88
----------------------------------------------------------------------

The key financial managers were also requested to provide information
on the number of accounting-related subjects completed as part of
their formal education.  Of the 194 respondents, 176 had completed
one or more of these subjects, as follows: 

  -- 1-2 subjects:  20 (5 officers and 15 civilians),

  -- 3-5 subjects:  44 (9 officers and 35 civilians), and

  -- 6 or more subjects:  112 (28 officers and 84 civilians). 

Included in this latter group were 109 (or about 56 percent of the
194 respondents) who reported completing both principles of
accounting and intermediate accounting, along with at least four
other subjects.  Based solely on a review of their formal education,
these 109 managers appear to have met the requirements to serve in
federal GS-510 accountant\10 positions. 


--------------------
\10 The typical educational requirement for GS-510 accountants is 24
credit hours in accounting-related subjects.  A person completing
principles of accounting and intermediate accounting subjects
(typically two courses of each) and four other subjects would
generally meet this hour requirement.  A civilian employee could also
be classified as a GS-510 with fewer than 24 hours of
accounting-related courses if a review of his or her formal
education, training, and experience so warrants. 


      PROFESSIONAL WORK EXPERIENCE
      ACQUIRED
---------------------------------------------------------- Letter :5.2

A review of the profiles showed that the 44 officers' careers ranged
from 4 to 33 years, averaging 21 years, while the 150 civilians'
careers ranged from 8 to 55 years, averaging 27 years.  Both officer
and civilian respondents, with a few exceptions, had spent most of
their careers in DOD.  Also, about 62 percent of all respondents
reported that they had performed several of the financial
management-related functions included in our review during their
careers. 

Figures 1 and 2 show the average number of years of work experience
by rank for the officers and by grade for the civilians,
respectively. 

   Figure 1:  Professional Work
   Experience Reported by Navy and
   Marine Corps Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure 2:  Professional Work
   Experience Reported by Navy and
   Marine Corps Financial
   Managers--Civilians

   (See figure in printed
   edition.)

In collaboration with Navy officials, we identified five functions
which are often performed by personnel serving in key financial
management positions, including: 

  -- financial statement preparation--preparing annual financial
     statements and footnotes;

  -- financial reporting/accounting policy--preparing financial
     reports and consulting on the application of accounting policy;

  -- financial analysis--performing tasks associated with cost
     accounting, business process improvements, budgeting, cash flow
     analysis, cost analysis, revenue and expenditure forecasting,
     and other analysis of financial position and operations;

  -- accounting operations--recording and reporting accounting
     transactions; and

  -- accounting systems development and maintenance--performing tasks
     associated with the functional design and maintenance of
     accounting and finance systems. 

Thirty officers and 90 civilians (or about 62 percent of the 194
respondents) reported that they had performed three or more of these
functions during their careers.  Figures 3 and 4 show the number of
officers and civilians who had performed each function at sometime
during their careers, and the average number of years of experience
in each function.  For example, figure 3 shows that 38 of the 44
officers had performed financial analysis-related tasks for an
average of 7 years. 

   Figure 3:  Experience in
   Financial Management Functions
   Reported by Navy and Marine
   Corps Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure 4:  Experience in
   Financial Management Functions
   Reported by Navy and Marine
   Corps Financial
   Managers--Civilians

   (See figure in printed
   edition.)


      TRAINING COMPLETED DURING
      1995 AND 1996
---------------------------------------------------------- Letter :5.3

During 1995 and 1996, about 64 percent of the officers and 88 percent
of the civilians reported completing some training in one or more of
the categories included in our review.  Of these 160 managers (28
officers and 132 civilians) receiving training, (1) 94 percent listed
general topics, such as computers, supervision, strategic planning,
and communications skills, as examples of the training they had
completed, (2) 61 percent reported completing some training in
financial topics, and (3) about 44 percent reported completing
training in accounting topics, such as accounting standards and
financial reporting.  Also, a review of the profiles showed that 46
managers completed only general training and 34 other managers had
not completed any training.  Therefore, 41 percent of the 194
respondents had not received any accounting or financial training for
those 2 years. 

Figure 5 shows the training reported as being completed by the 194
respondents during the 2-year period. 

   Figure 5:  Training Reported by
   Navy and Marine Corps Financial
   Managers as Being Completed
   During 1995 and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  70 (17 officers
     and 53 civilians),

  -- total receiving financial-related training:  98 (21 officers and
     77 civilians),

  -- total receiving training in general topics:  151 (23 officers
     and 128 civilians), and

  -- total not receiving training:  34 (16 officers and 18
     civilians). 


      PROFESSIONAL CERTIFICATIONS
      HELD
---------------------------------------------------------- Letter :5.4

About 22 percent of the 194 respondents reported holding one or more
professional certifications.  A review of the profiles showed that,
of these 42 managers,

  -- 13 were CPAs (1 officer and 12 civilians),

  -- 23 were CGFMs (3 officers and 20 civilians),

  -- 9 held other financial management certifications, including the
     Certified Management Accountant and Certified Fraud Examiner (3
     officers and 6 civilians), and

  -- 6 reported holding nonfinancial management certifications (1
     officer and 5 civilians). 

Of the 152 managers that did not hold any professional
certifications, 37 were officers and 115 were civilians.  Figure 6
shows the types of professional certifications reported by the 194
Navy and Marine Corps financial managers. 

   Figure 6:  Professional
   Certifications Reported by Navy
   and Marine Corps Financial
   Managers

   (See figure in printed
   edition.)

CPA:  Certified Public Accountant

CGFM:  Certified Government Financial Manager

OFMC:  Other financial management certifications

NFMC:  Nonfinancial management certifications

Appendixes II through VII provide the formal education, professional
work experience, training, and professional certification data
reported by the 44 officers and 150 civilians by their respective
organizations, including: 

  -- ASN/FM&C in appendix II;

  -- four Naval operational commands and 34 of their 50 installations
     in appendix III;

  -- the Chief of Naval Education and Training (CNET) and six of its
     seven installations in appendix IV;

  -- Naval Sea Systems Command, Naval Air Systems Command, Naval
     Supply Systems Command, and Naval Facilities Engineering Command
     and 19 of their 28 working capital fund installations, including
     shipyards, weapon stations, aviation depots, fleet industrial
     supply centers, and public work centers in appendix V;

  -- Naval Sea Systems Command and Naval Air Systems Command and 9 of
     their 13 air and surface warfare centers responsible for the
     research, development, test, and evaluation (RDT&E) and
     procurement of Navy aeronautical, electronics, ship, and
     submarine systems in appendix VI; and

  -- Headquarters, U.S.  Marine Corps and 12 of its 17 commands and
     installations in appendix VII. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :6

In commenting on a draft of this report, the Navy indicated that the
information will be useful in its continuing efforts to ensure that
all of its financial managers are able to address the financial
management needs of the department.  The Navy provided two additional
comments: 

  -- While acknowledging that accounting training and experience are
     becoming increasingly relevant to the financial management
     working environment, it stated that the report placed too much
     emphasis on the accounting discipline. 

  -- It stated that professional certifications in and of themselves
     may not always be a useful indicator, adding that it has chosen
     to emphasize continuing education as more useful in maintaining
     a flexible and broad-based financial management workforce. 

Our report presents information on a number of measures relating to
qualifications and experience of key Navy financial managers.  As
agreed with Navy officials when we initiated this profiling work,
information on formal education and training, including accounting
training, and professional certification are among such important
measures.  The key Navy financial managers surveyed are responsible
for accurately recording and including the results of transactions in
financial and budgetary reports and statements for one of the largest
entities in the federal government, with worldwide operations.  It is
important that this information be reliable, given its intended use
for managerial and budgetary decisions. 

We recently reported that the Navy, to an even greater extent than
the other military services, has been plagued for years by
troublesome financial accounting and reporting problems involving
billions of dollars.\11 Continuing errors, misstatements, and
internal control weaknesses have precluded the Naval Audit Service
from rendering anything other than a disclaimer of opinion on the
Navy's financial statements.  In that context, and as the Navy
response indicates, the profiling information, including formal
education, professional work experience, training, and professional
certifications, will help the department evaluate its military and
civilian career programs to help ensure that Navy financial managers
provide the best possible service to customers. 

Regarding Navy's comment that it has chosen to emphasize continuing
education rather that professional certifications for its financial
management workforce, our point is that certifications, with
accompanying requirements for continuing professional education, can
be used as one vehicle in ensuring that financial managers receive
necessary training on an ongoing basis.  The Navy's comments are
reprinted in appendix VIII. 


--------------------
\11 CFO Act Financial Audits:  Programmatic and Budgetary
Implications of Navy Financial Data Deficiencies (GAO/AIMD-98-56,
March 16, 1998). 


---------------------------------------------------------- Letter :6.1

We are sending copies of this report to the Chairmen and Ranking
Minority Members of the Senate Committee on Governmental Affairs; the
House Committee on Government Reform and Oversight; and the
Subcommittee on Government Management, Information and Technology of
the House Committee on Government Reform and Oversight; the Secretary
of Defense; and the Director of the Office of Management and Budget. 
Copies will also be made available to others upon request. 


If you have any questions about this report, please contact me at
(202) 512-9095.  Major contributors to this report are listed in
appendix IX. 

Sincerely yours,

Lisa G.  Jacobson
Director, Defense Audits


SCOPE AND METHODOLOGY
=========================================================== Appendix I

In collaboration with Navy officials, we identified senior executives
and financial managers from the Navy and Marine Corps to be included
in this review as those serving in key positions throughout the
department.  The four senior executives in the Office of the
Assistant Secretary of the Navy (Financial Management and
Comptroller) (ASN/FM&C) included the Assistant Secretary of the Navy
(Financial Management and Comptroller); the Principal Deputy
Assistant Secretary of the Navy (Financial Management and
Comptroller); the Director, Office of Financial Operations; and the
Director, Office of Budget.  The 306 key financial management
positions selected for this review included: 

  -- 7 from ASN/FM&C involved in financial operations, financial
     management/accounting policy, and/or budget execution-related
     functions and

  -- 299 (including comptrollers, deputy comptrollers, budget
     officers, and working capital fund managers) from 126 Navy and
     Marine Corps major commands and installations involved in (1)
     operations, (2) training, (3) supply and maintenance, and (4)
     research, development, test, evaluation, and procurement of Navy
     and Marine Corps systems, such as aeronautics, electronics,
     ships, and submarines. 

In addition to the 4 senior executives, 194 financial managers
located at 89 of the 126 organizations responded to this review.  The
194 respondents included the 7 ASN/FM&C managers and 187 managers
from major commands and installations made up of 71 comptrollers, 47
deputy comptrollers, 67 budget officers, and 2 working capital fund
managers. 

Table I.1 identifies the Navy and Marine Corps major commands, the
number of their installations, and information on the key financial
managers included in this review. 



                               Table I.1
                
                   Navy and Marine Corps Command and
                  Installation Key Financial Managers
                        Included in This Review

----------------------------------------------------------------------
Navy Operational Organizations

Commander in Chief, U.S. Atlantic Fleet and 15 of its 22 installations
(27 of the 55 managers responding included 10 comptrollers, 7 deputy
comptrollers, and 10 budget officers)

Commander in Chief, U.S. Pacific Fleet and 12 of its 21 installations
(27 of the 50 managers responding included 11 comptrollers, 6 deputy
comptrollers, and 10 budget officers)

Commander in Chief, U.S. Navy in Europe and its two installations
(eight of the nine managers responding included two comptrollers,
three deputy comptrollers, and three budget officers)

Commanding Officer, Military Sealift Command and its five
installations (12 of the 14 managers responding included 6
comptrollers, 2 deputy comptrollers, and 4 budget officers)

Navy Training Organizations

Chief of Naval Education and Training Command and six of its seven
installations (12 of the 17 managers responding included 6
comptrollers, 1 deputy comptroller, and 5 budget officers)

Navy Working Capital Fund Organizations

Naval Sea Systems Command, Naval Air Systems Command, Naval Supply
Systems Command, and Naval Facilities Engineering Command and 19 of
their 28 installations, including shipyards, weapon stations, aviation
depots, fleet industrial supply centers, and public work centers (49
of the 79 managers responding included 18 comptrollers, 14 deputy
comptrollers, 15 budget officers, and 2 working capital fund managers)

Navy Systems Command Organizations

Naval Sea Systems Command and Naval Air Systems Command and 9 of their
13 air and surface warfare centers (24 of the 37 managers responding
included 9 comptrollers, 7 deputy comptrollers, and 8 budget officers)

Marine Corps Organizations

Headquarters, U.S. Marine Corps and 12 of its 17 installations, such
as operational, training, working capital, and systems (33 of the 44
managers responding included 11 comptrollers, 9 deputy comptrollers,
and 13 budget officers)
----------------------------------------------------------------------
Note:  The comptrollers and deputy comptrollers at Naval Sea Systems
Command and Naval Air Systems Command and the budget officer at Naval
Air Systems Command were included in our review of both working
capital fund and systems command organizations. 

We obtained fiscal year 1997 Navy and Marine Corps budget data,
including operation and maintenance (O&M); research, development,
test and evaluation (RDT&E); and procurement funding from the
ASN/FM&C budget office.  Those major commands and installations
identified for this review managed $52 billion of approximately $80
billion budgeted for the Navy and Marine Corps during fiscal year
1997. 

In an August 1988 report,\1 GAO proposed a framework for evaluating
the quality of the federal workforce over time.  Quantifiable
measures identified in that report include specific knowledge,
skills, and abilities.  Using this report and the JFMIP study on core
competencies, and in collaboration with DOD representatives, we
identified four indicators to measure the attributes that key
financial managers can bring to their positions.  These indicators
include formal education, professional work experience, training, and
professional certifications.  These attributes are being used to
measure the qualifications and experience of key financial managers
in the five DOD organizations included in our reviews. 

We then worked with Navy officials in developing a data collection
instrument to gather the following types of information for each
indicator: 

  -- Formal education:  degrees attained, academic majors, and
     specific accounting and financial-related courses completed. 

  -- Professional work experience:  (1) number of years worked in
     current position, years at DOD, years in other government
     agencies, and years in the private sector and (2) experience in
     the five specific financial management-related functions. 

  -- Training (referred to as continuing professional education in
     the profile instrument):  for the period of 1995-1996, specific
     training related to accounting, other financial-related topics,
     and general topics. 

  -- Professional certifications:  CPA, CGFM, other financial
     certifications, and other nonfinancial management certifications
     held. 

For the four Navy executives, we obtained information on their formal
education, careers, and professional certifications from biographies
provided by these officials.  For all other individuals, due to Navy
officials' concerns over the completeness of personnel files and
databases, we also agreed to collect information on the four
indicators using profile instruments.  This procedure is being used
for collecting qualification and experience information from all DOD
organizations in this series of assignments. 

The Navy liaisons sent profile instruments to the key Navy and Marine
Corps financial managers in the Office of the Assistant Secretary of
the Navy (Financial Management and Comptroller) and major commands
and installations identified for this review.  The liaisons and we
contacted those financial managers who did not initially respond as
well as those managers whose profile instruments were returned with
incomplete information.  Through these efforts, we received complete
profile information from the four Navy executives and 63 percent of
the key financial managers identified for this review.  Figure I.1
contains the profile instrument we used to obtain personnel
qualification and experience information from the key financial
managers. 

As agreed with the Navy, we did not attempt to verify the information
contained in the profiles.  However, as noted above, for incomplete
instruments, the Navy liaisons and we conducted follow-up efforts and
obtained the missing information. 

We conducted our work from March 1997 through January 1998 in
accordance with generally accepted government auditing standards. 

   Figure I.1:  Profile Instrument
   Used to Collect Qualification
   and Experience Information on
   Navy and Marine Corps Financial
   Managers

   (See figure in printed
   edition.)



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)


--------------------
\1 Federal Workforce:  A Framework for Studying Its Quality Over Time
(GAO/PEMD-88-27, August 4, 1988). 


PROFILES OF OFFICE OF THE
ASSISTANT SECRETARY OF THE NAVY
(FINANCIAL MANAGEMENT AND
COMPTROLLER) RESPONDENTS
========================================================== Appendix II

We included seven key financial managers in the Office of the
Assistant Secretary of the Navy (Financial Management and
Comptroller) (ASN/FM&C), all of whom provided information on their
qualifications and experience.  This population included one manager
involved in financial operations, one manager in financial
management/accounting policy, and five managers in budget execution
functions.  Table II.1 shows the officer and civilian composition of
these managers, by rank and grade, respectively. 



                               Table II.1
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank                        Number  Grade                       Number
------------------------  --------  ------------------------  --------
Rear Admiral (O-7)               0  Senior Executive                 6
Captain (O-6)                    1  15                               0
Commander (O-5)                  0  14                               0
Lieutenant Commander             0  13                               0
 (O-4)
Lieutenant (O-3)                 0  12                               0
Lieutenant (junior               0  11                               0
 grade) (O-2)
======================================================================
Total                            1  Total                            6
----------------------------------------------------------------------
FORMAL EDUCATION ATTAINED

As shown in table II.2, seven respondents held bachelor's degrees,
with one reporting more than one major.  None of the seven managers
majored in accounting and one manager reported a business-related
major. 



                               Table II.2
                
                  Bachelor's Degree Majors Reported by
                      ASN/FM&C Financial Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              0              0
Other business                         0              1              1
Nonbusiness                            1              6              7
======================================================================
Total degrees                          1              7              8
----------------------------------------------------------------------
As shown in table II.3, three respondents also held master's degrees. 
One manager held a master's degree in accounting and another manager
reported a business-related major. 



                               Table II.3
                
                Master's Degree Majors Reported by ASN/
                        FM&C Financial Managers

                                    Number of master's degree majors
                                  ------------------------------------
                                                 Civili  Total degrees
Majors                                 Officers     ans       by major
--------------------------------  -------------  ------  =============
Accounting                                    0       1              1
Other business                                0       1              1
Nonbusiness                                   1       0              1
======================================================================
Total degrees                                 1       2              3
----------------------------------------------------------------------
Four respondents reported completing one or more courses in
accounting-related subjects, as follows: 

  -- 1-2 subjects:  two civilians,

  -- 3-5 subjects:  none, and

  -- 6 or more subjects:  two civilians. 

Based solely on a review of their formal education, the two civilians
in the latter group appear to have met the requirements to serve in
GS-510 accountant positions. 

PROFESSIONAL WORK EXPERIENCE
ACQUIRED

A review of the profiles showed that the number of years of
professional work experience was 26 years for the officer, and the
average number of years was 23 years for the civilians, with a range
of 18 to 31 years.  With one exception, the respondents had spent
most of their careers in DOD.  Figures II.1 and II.2 show the work
experience by rank for the officer and by grade for the civilians,
respectively. 

   Figure II.1:  Professional Work
   Experience Reported by ASN/FM&C
   Financial Managers--Officers

   (See figure in printed
   edition.)

   Figure II.2:  Professional Work
   Experience Reported by ASN/FM&C
   Financial Managers--Civilians

   (See figure in printed
   edition.)

Figures II.3 and II.4 show the number of officers and civilians who
indicated that they had performed each financial management function
previously outlined at sometime during their careers, and the average
number of years of experience in each function.  Financial analysis
was the function performed most frequently.  A review of the profiles
also showed that three civilians had performed three or more of these
functions. 

   Figure II.3:  Experience in
   Financial Management Functions
   Reported by ASN/FM&C Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure II.4:  Experience in
   Financial Management Functions
   Reported by ASN/FM&C Financial
   Managers--Civilians

   (See figure in printed
   edition.)

TRAINING COMPLETED DURING 1995 AND
1996

Figure II.5 shows the training reported by the seven respondents as
being completed during 1995 and 1996. 

   Figure II.5:  Training Reported
   by ASN/FM&C Financial Managers
   as Being Completed During 1995
   and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  two civilians,

  -- total receiving financial-related training:  two civilians,

  -- total receiving training in general topics:  six civilians, and

  -- total not receiving training:  one officer. 

PROFESSIONAL CERTIFICATIONS HELD

A review of the profiles showed that, of the two respondents
reporting one or more professional certifications,

  -- one civilian was a CPA and CGFM and held another financial
     certification and

  -- the officer held another financial management certification. 

Five civilians did not hold any professional certifications.  Figure
II.6 shows the types of professional certifications reported by the
ASN/FM&C financial managers. 

   Figure II.6:  Professional
   Certifications Reported by
   ASN/FM&C Financial Managers

   (See figure in printed
   edition.)

CPA:  Certified Public Accountant

CGFM:  Certified Government Financial Manager

OFMC:  Other financial management certifications


PROFILES OF NAVY OPERATIONAL
COMMAND AND INSTALLATION
RESPONDENTS
========================================================= Appendix III

The four Navy operational commands included in this review, shown
below, managed O&M and working capital fund budgets totaling $10.8
billion during fiscal year 1997: 

  -- U.S.  Atlantic Fleet,

  -- U.S.  Pacific Fleet,

  -- U.S.  Navy in Europe, and

  -- Military Sealift Command. 

Surveys were distributed to 128 financial managers; 74 responded,
representing the four operational commands\1 and 34 of their 50
installations.  Table III.1 shows the number of installations
responding by major command, the number of key financial managers
surveyed within each command, and the number responding to this
review.  The table also shows the O&M funding budgeted for fiscal
year 1997 for three of the major commands, and the working capital
fund budget for the Military Sealift Command. 



                              Table III.1
                
                Navy Operational Commands' Key Financial
                 Manager Population and Respondents and
                      Budgets for Fiscal Year 1997

                               Financial      Financial
Commands (and number of         managers        manager        Budgets
installations) responding       surveyed    respondents  (in billions)
-------------------------  -------------  -------------  -------------
U.S. Atlantic Fleet (15)              55             27           $4.6
U.S. Pacific Fleet (12)               50             27            4.8
U.S. Navy in Europe (2)                9              8             .3
Military Sealift Command              14             12            1.1
 (5)
======================================================================
Total (34)                           128             74          $10.8
----------------------------------------------------------------------
Note:  Budgets are operation and maintenance for each command, except
the Military Sealift Command (MSC).  MSC is a working capital fund
activity. 

The 74 respondents included 29 comptrollers, 18 deputy comptrollers,
and 27 budget officers.  Table III.2 shows the officer and civilian
composition of the respondents, by rank and grade, respectively. 



                              Table III.2
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank                        Number  Grade                       Number
------------------------  --------  ------------------------  --------
Rear Admiral (O-7)               0  Senior Executive                 1
Captain (O-6)                    5  15                               6
Commander (O-5)                 11  14                               6
Lieutenant Commander             3  13                              16
 (O-4)
Lieutenant (O-3)                 4  12                              20
Lieutenant (junior               0  11                               2
 grade) (O-2)
======================================================================
Total                           23  Total                           51
----------------------------------------------------------------------
FORMAL EDUCATION ATTAINED

As shown in table III.3, 58 of the 74 respondents held bachelor's
degrees, with 1 reporting two majors.  The major for 15 of these
managers was accounting, while 27 managers reported other
business-related majors. 



                              Table III.3
                
                  Bachelor's Degree Majors Reported by
                      Navy Operational Command and
                    Installation Financial Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             2             13             15
Other business                        12             15             27
Nonbusiness                            9              8             17
======================================================================
Total degrees                         23             36             59
----------------------------------------------------------------------
As shown in table III.4, 31 respondents also held master's degrees,
with 3 reporting more than one major.  Three managers held a master's
degree in accounting, while 25 managers listed one or more other
business-related majors. 



                              Table III.4
                
                Master's Degree Majors Reported by Navy
                  Operational Command and Installation
                           Financial Managers

                                Number of master's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             2              1              3
Other business                        19              7             26
Nonbusiness                            2              3              5
======================================================================
Total degrees                         23             11             34
----------------------------------------------------------------------
Sixty-eight of the 74 respondents reported completing one or more
courses in accounting-related subjects, as follows: 

  -- 1-2 subjects:  9 (3 officers and 6 civilians),

  -- 3-5 subjects:  16 (4 officers and 12 civilians), and

  -- 6 or more subjects:  43 (16 officers and 27 civilians). 

Based solely on a review of their formal education, 14 officers and
27 civilians in the latter group appear to have met the requirements
to serve in GS-510 accountant positions. 

PROFESSIONAL WORK EXPERIENCE
ACQUIRED

A review of the profiles showed that the average number of years of
professional work experience was 20 years for the 23 officers, with a
range of 9 to 30 years, and 30 years for the 51 civilians, with a
range of 12 to 45 years.  With two exceptions, the 74 respondents had
spent most of their careers in DOD.  Figures III.1 and III.2 show the
work experience by rank for the officers and by grade for the
civilians, respectively. 

   Figure III.1:  Professional
   Work Experience Reported by
   Navy Operational Command and
   Installation Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure III.2:  Professional
   Work Experience Reported by
   Navy Operational Command and
   Installation Financial
   Managers--Civilians

   (See figure in printed
   edition.)

Figures III.3 and III.4 show the number of officers and civilians who
indicated that they had performed each financial management function
previously outlined at sometime during their careers, and the average
number of years of experience in each function.  Financial analysis
was the function performed most frequently.  A review of the profiles
also showed that 16 officers and 33 civilians had performed three or
more of these functions. 

   Figure III.3:  Experience in
   Financial Management Functions
   Reported by Navy Operational
   Command and Installation
   Financial Managers--Officers

   (See figure in printed
   edition.)

   Figure III.4:  Experience in
   Financial Management Functions
   Reported by Navy Operational
   Command and Installation
   Financial Managers--Civilians

   (See figure in printed
   edition.)

TRAINING COMPLETED DURING 1995 AND
1996

Figure III.5 shows the training reported by the 74 respondents as
being completed during 1995 and 1996. 

   Figure III.5:  Training
   Reported by Navy Operational
   Command and Installation
   Financial Managers as Being
   Completed During 1995 and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  30 (9 officers and
     21 civilians),

  -- total receiving financial-related training:  35 (11 officers and
     24 civilians),

  -- total receiving training in general topics:  50 (10 officers and
     40 civilians), and

  -- total not receiving training:  17 (9 officers and 8 civilians). 

PROFESSIONAL CERTIFICATIONS HELD

A review of the profiles showed that, of the 17 managers reporting
one or more professional certificates,

  -- 4 were CPAs (1 officer and 3 civilians),

  -- 10 were CGFMs (1 officer and 9 civilians),

  -- 3 held other financial management certifications (2 officers and
     1 civilian), and

  -- 2 held nonfinancial management certifications (1 officer and 1
     civilian). 

Of the 57 managers that did not hold any professional certifications,
19 were officers and 38 were civilians.  Figure III.6 shows the types
of professional certifications reported by the Navy operational
command and installation financial managers. 

   Figure III.6:  Professional
   Certifications Reported by Navy
   Operational Command and
   Installation Financial Managers

   (See figure in printed
   edition.)

CPA:  Certified Public Accountant

CGFM:  Certified Government Financial Manager

OFMC:  Other financial management certifications

NFMC Nonfinancial management certifications


--------------------
\1 As the Naval Facilities Engineering Command's two construction
battalions are operational in nature, they are included in our review
of operational organizations. 


PROFILES OF CHIEF OF NAVAL
EDUCATION AND TRAINING (CNET) AND
INSTALLATION RESPONDENTS
========================================================== Appendix IV

CNET managed an O&M budget of $1.1 billion for fiscal year 1997. 
Twelve of the 17 key financial managers from CNET (representing six
of its seven installations) provided information on their
qualifications and experience, including 6 comptrollers, 1 deputy
comptroller, and 5 budget officers.  Table IV.1 shows the officer and
civilian composition of the 12 respondents, by grade and rank,
respectively. 



                               Table IV.1
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank                        Number  Grade                       Number
------------------------  --------  ------------------------  --------
Rear Admiral (O-7)               0  Senior Executive                 1
Captain (O-6)                    0  15                               1
Commander (O-5)                  1  14                               1
Lieutenant Commander             0  13                               1
 (O-4)
Lieutenant (O-3)                 0  12                               5
Lieutenant (junior               0  11                               2
 grade) (O-2)
======================================================================
Total                            1  Total                           11
----------------------------------------------------------------------
FORMAL EDUCATION ATTAINED

As shown in table IV.2, 10 respondents held bachelor's degrees, with
1 reporting more than one major.  Five managers majored in
accounting, while four managers reported other business-related
majors. 



                               Table IV.2
                
                  Bachelor's Degree Majors Reported by
                Naval Education and Training Command and
                    Installation Financial Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              5              5
Other business                         0              4              4
Nonbusiness                            1              1              2
======================================================================
Total degrees                          1             10             11
----------------------------------------------------------------------
As shown in table IV.3, two respondents also held master's degrees,
with one reporting two majors.  The major for one of the two managers
was business related. 



                               Table IV.3
                
                Master's Degree Majors Reported by Naval
                   Education and Training Command and
                    Installation Financial Managers

                                Number of master's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              0              0
Other business                         0              1              1
Nonbusiness                            2              0              2
======================================================================
Total degrees                          2              1              3
----------------------------------------------------------------------
Nine of the 12 respondents reported completing one or more courses in
accounting-related subjects, as follows: 

  -- 1-2 subjects:  1 officer,

  -- 3-5 subjects:  2 civilians, and

  -- 6 or more subjects:  6 civilians. 

Based solely on a review of their formal education, the six civilians
in the latter group appear to have met the requirements to serve in
GS-510 accountant positions. 

PROFESSIONAL WORK EXPERIENCE
ACQUIRED

A review of the profiles showed that the number of years of
professional work experience for the officer was 19 years and the
average number of years was 30 years for the 11 civilians, with a
range of 14 to 37 years.  The respondents had spent most of their
careers in DOD.  Figures IV.1 and IV.2 show the average number of
years of work experience by rank for the officer and by grade for the
11 civilians, respectively. 

   Figure IV.1:  Professional Work
   Experience Reported by Naval
   Education and Training Command
   and Installation Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure IV.2:  Professional Work
   Experience Reported by Naval
   Education and Training Command
   and Installation Financial
   Managers--Civilians

   (See figure in printed
   edition.)

Figures IV.3 and IV.4 show the number of officers and civilians who
indicated that they had performed each financial management function
previously outlined at sometime during their careers, and the average
number of years of experience in each function.  The financial
management function performed most frequently was financial analysis. 
A review of the profiles also showed that the officer and six
civilians had performed three or more of these functions. 

   Figure IV.3:  Experience in
   Financial Management Functions
   Reported by Naval Education and
   Training Command and
   Installation Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure IV.4:  Experience in
   Financial Management Functions
   Reported by Naval Education and
   Training Command and
   Installation Financial
   Managers--Civilians

   (See figure in printed
   edition.)

TRAINING COMPLETED DURING 1995 AND
1996

Figure IV.5 shows the training reported by 12 respondents as being
completed during 1995 and 1996. 

   Figure IV.5:  Training Reported
   by Naval Education and Training
   Command and Installation
   Financial Managers as Being
   Completed During 1995 and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  7 (1 officer and 6
     civilians),

  -- total receiving financial-related training:  7 (1 officer and 6
     civilians),

  -- total receiving training in general topics:  11 (1 officer and
     10 civilians), and

  -- total not receiving training:  1 civilian. 

PROFESSIONAL CERTIFICATIONS HELD

None of the 12 respondents reported holding professional
certifications. 


PROFILES OF NAVY WORKING CAPITAL
FUND RESPONDENTS
=========================================================== Appendix V

The 28 Navy working capital fund installations, including shipyards,
weapons centers, aviation depots, supply centers, and public work
centers, managed a fiscal year 1997 budget of $12.5 billion budget,
derived from their customers' O&M accounts.  Forty-nine\1

of the 79 financial managers at the Naval Sea Systems Command, Naval
Air Systems Command, Naval Supply Systems Command, and Naval
Facilities Engineering Command and 19 of their installations provided
information on their qualifications and experience.  The 49
respondents included 18 comptrollers, 14 deputy comptrollers, 15
budget officers, and 2 working capital fund managers.  Table V.1
provides the ranks of the 8 officers and grades of the 41 civilians. 



                               Table V.1
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank                        Number  Grade                       Number
------------------------  --------  ------------------------  --------
Rear Admiral (O-7)               0  Senior Executive                 3
Captain (O-6)                    5  15                               9
Commander (O-5)                  2  14                              12
Lieutenant Commander             1  13                              10
 (O-4)
Lieutenant (O-3)                 0  12                               6
Lieutenant (junior               0  11                               1
 grade) (O-2)
======================================================================
Total                            8  Total                           41
----------------------------------------------------------------------
FORMAL EDUCATION ATTAINED

As shown in table V.2, 44 of the 49 respondents held bachelor's
degrees, with 1 reporting more than one major.  Fifteen managers
majored in accounting, while 20 managers reported other
business-related majors. 



                               Table V.2
                
                  Bachelor's Degree Majors Reported by
                  Navy Working Capital Fund Financial
                                Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Major                           Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             1             14             15
Other business                         5             15             20
Nonbusiness                            3              7             10
======================================================================
Total degrees                          9             36             45
----------------------------------------------------------------------
As shown in table V.3, 23 respondents also held master's degrees,
with 1 reporting two majors.  One manager reported a master's degree
in accounting and 17 managers listed other business-related majors. 



                               Table V.3
                
                Master's Degree Majors Reported by Navy
                Working Capital Fund Financial Managers

                                Number of master's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              1              1
Other business                         7             10             17
Nonbusiness                            2              4              6
======================================================================
Total degrees                          9             15             24
----------------------------------------------------------------------
Forty-eight of the 49 respondents reported completing one or more
courses in accounting-related subjects, as follows: 

  -- 1-2 subjects:  4 (1 officer and 3 civilians),

  -- 3-5 subjects:  13 (3 officers and 10 civilians), and

  -- 6 or more subjects:  31 (4 officers and 27 civilians). 

Based solely on a review of their formal education, the 4 officers
and 26 civilians in the latter group appear to have met the
requirements to serve in GS-510 accountant positions. 

PROFESSIONAL WORK EXPERIENCE
ACQUIRED

A review of the profiles showed that the average number of years of
professional work experience was 24 years for the 8 officers, with a
range of 4 to 33 years, and 27 years for the 41 civilians, with a
range of 8 to 55 years.  The respondents had spent most of their
careers in DOD.  Figures V.1 and V.2 show the average number of years
of work experience by rank for the officers and by grade for the
civilians, respectively. 

   Figure V.1:  Professional Work
   Experience Reported by Navy
   Working Capital Fund Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure V.2:  Professional Work
   Experience Reported by Navy
   Working Capital Fund Financial
   Managers--Civilians

   (See figure in printed
   edition.)

Figures V.3 and V.4 show the number of officers and civilians who
indicated that they had performed each financial management function
previously outlined at sometime during their careers, and the average
number of years of experience in each function.  The financial
management function performed most frequently was financial analysis. 
A review of the profiles also showed that 6 officers and 27 civilians
had performed three or more of these functions. 

   Figure V.3:  Experience in
   Financial Management Functions
   Reported by Navy Working
   Capital Fund Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure V.4:  Experience in
   Financial Management Functions
   Reported by Navy Working
   Capital Fund Financial
   Managers--Civilians

   (See figure in printed
   edition.)

TRAINING COMPLETED DURING 1995 AND
1996

Figure V.5 shows the training reported by the 49 respondents as being
completed during 1995 and 1996. 

   Figure V.5:  Training Reported
   by Navy Working Capital Fund
   Financial Managers as Being
   Completed During 1995 and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  15 (3 officers and
     12 civilians),

  -- total receiving financial-related training:  29 (3 officers and
     26 civilians),

  -- total receiving training in general topics:  46 (7 officers and
     39 civilians), and

  -- total not receiving training:  3 (1 officer and 2 civilians). 

PROFESSIONAL CERTIFICATIONS HELD

A review of the profiles showed that, of the 10 managers holding one
or more professional certifications,

  -- 3 civilians were CPAs,

  -- 6 were CGFMs (1 officer and 5 civilians),

  -- 2 civilians held other financial management certifications, and

  -- 1 civilian held nonfinancial management certifications. 

Of the 39 managers that did not hold any professional certifications,
7 were officers and 32 were civilians.  Figure V.6 shows the types of
professional certifications reported by the Navy working capital fund
key financial managers. 

   Figure V.6:  Professional
   Certifications Reported by Navy
   Working Capital Fund Financial
   Managers

   (See figure in printed
   edition.)

CPA:  Certified Public Accountant

CGFM:  Certified Government Financial Manager

OFMC:  Other financial management certifications

NFMC:  Nonfinancial management certifications


--------------------
\1 The comptrollers and deputy comptrollers at Naval Sea Systems
Command and Naval Air Systems Command and the budget officer at Naval
Air Systems Command were included in our review of the working
capital fund and systems command financial managers because these
officials have oversight responsibilities in both organizations. 


PROFILES OF NAVY SYSTEMS COMMAND
RESPONDENTS
========================================================== Appendix VI

In addition to overseeing their respective working capital fund
activities, the Naval Sea Systems Command and Naval Air Systems
Command also have oversight of the development of Navy systems. 
These commands managed an O&M budget of $5.0 billion, a RDT&E budget
of $4.5 billion, and a procurement budget of $15.3 billion during
fiscal year 1997. 

Twenty-four of the 37 key financial managers at these commands\1 and
9 of their 13 installations provided information on their
qualifications and experience.  The 24 included 9 comptrollers, 7
deputy comptrollers, and 8 budget officers.  Table VI.1 shows the
officer and civilian composition of the 24 respondents. 



                               Table VI.1
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank                        Number  Grade                       Number
------------------------  --------  ------------------------  --------
Rear Admiral (O-7)               0  Senior Executive                 2
Captain (O-6)                    2  15                               8
Commander (O-5)                  0  14                               7
Lieutenant Commander             0  13                               5
 (O-4)
Lieutenant (O-3)                 0  12                               0
Lieutenant (junior               0  11                               0
 grade) (O-2)
======================================================================
Total                            2  Total                           22
----------------------------------------------------------------------
FORMAL EDUCATION ATTAINED

As shown in table VI.2, 23 of the 24 respondents held bachelor's
degrees, with 1 also reporting two majors.  Seven of these managers
majored in accounting, while 10 managers reported other
business-related majors. 



                               Table VI.2
                
                  Bachelor's Degree Majors Reported by
                Navy Systems Command Financial Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              7              7
Other business                         2              8             10
Nonbusiness                            0              7              7
======================================================================
Total degrees                          2             22             24
----------------------------------------------------------------------
As shown in table VI.3, 12 respondents also held master's degrees. 
One manager reported a master's degree in accounting and eight
managers listed other business-related majors. 



                               Table VI.3
                
                Master's Degree Majors Reported by Navy
                   Systems Command Financial Managers

                                Number of master's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              1              1
Other business                         2              6              8
Nonbusiness                            0              3              3
======================================================================
Total degrees                          2             10             12
----------------------------------------------------------------------
Twenty-three of the 24 respondents reported completing one or more
courses in accounting-related subjects, as follows: 

  -- 1-2 subjects:  2 civilians,

  -- 3-5 subjects:  7 civilians, and

  -- 6 or more subjects:  14 (2 officers and 12 civilians). 

Based solely on a review of their formal education, the respondents
in the latter group appear to have met the requirements to serve in
GS-510 accountant positions. 

PROFESSIONAL WORK EXPERIENCE
ACQUIRED

A review of the profiles showed that the average years of
professional work experience was 26 years for the 2 officers, with a
range of 24 to 27 years, and 27 years for the 22 civilians, with a
range of 16 to 55 years.  With one exception, the respondents had
spent most of their careers in DOD.  Figures VI.1 and VI.2 show the
average number of years of work experience by rank for the 2 officers
and by grade for the 22 civilians, respectively. 

   Figure VI.1:  Professional Work
   Experience Reported by Navy
   Systems Command Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure VI.2:  Professional Work
   Experience Reported by Navy
   Systems Command Financial
   Managers--Civilians

   (See figure in printed
   edition.)

Figures VI.3 and VI.4 show the number of officers and civilians who
indicated that they had performed each financial management function
previously outlined at sometime during their careers and the average
number of years of experience in each function.  The financial
management function performed most frequently was financial analysis. 
A review of the profiles also showed that one officer and nine
civilians had performed three or more of these functions. 

   Figure VI.3:  Experience in
   Financial Management Functions
   Reported by Navy Systems
   Command Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure VI.4:  Experience in
   Financial Management Functions
   Reported by Navy Systems
   Command Financial
   Managers--Civilians

   (See figure in printed
   edition.)

TRAINING COMPLETED DURING 1995 AND
1996

Figure VI.5 shows the training reported by the 24 respondents as
being completed during 1995 and 1996. 

   Figure VI.5:  Training Reported
   by Navy Systems Command
   Financial Managers as Being
   Completed During 1995 and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  7 (1 officer and 6
     civilians),

  -- total receiving financial-related training:  9 (1 officer and 8
     civilians),

  -- total receiving training in general topics:  19 (2 officers and
     17 civilians), and

  -- total not receiving training:  5 civilians. 

PROFESSIONAL CERTIFICATIONS HELD

A review of the profiles showed that, of the eight managers reporting
one or more professional certifications,

  -- five civilians were CPAs,

  -- four were CGFMs (one officer and three civilians), and

  -- two civilians held nonfinancial management certifications. 

Of the 16 managers that did not hold any professional certifications,
1 was an officer and 15 were civilians.  Figure VI.6 shows the types
of professional certifications reported by the Navy systems command
key financial managers. 

   Figure VI.6:  Professional
   Certifications Reported by Navy
   Systems Command Financial
   Managers

   (See figure in printed
   edition.)

CPA:  Certified Public Accountant

CGFM:  Certified Government Financial Manager

OFMC:  Other financial management certifications

NFMC:  Nonfinancial management certifications


--------------------
\1 The comptrollers and deputy comptrollers at Naval Sea Systems
Command and Naval Air Systems Command and the budget officer at Naval
Air Systems Command were included in our review of the working
capital fund and systems command financial managers because these
officials have oversight responsibilities in both organizations. 


PROFILES OF MARINE CORPS
RESPONDENTS
========================================================= Appendix VII

The Marine Corps managed an O&M budget of $1.8 billion, a RDT&E
budget of $266.4 million, and a procurement budget of $580.7 million
during fiscal year 1997.  Thirty-three of the 44 key financial
managers (representing the Headquarters, U.S.  Marine Corps and 12 of
its 17 commands and installations) provided information on their
qualifications and experience, including 11 comptrollers, 9 deputy
comptrollers, and 13 budget officers.  Table VII.1 shows the officer
and civilian composition of the respondents by rank and grade,
respectively. 



                              Table VII.1
                
                     Number of Officer and Civilian
                              Respondents

             Officers                           Civilians
----------------------------------  ----------------------------------
Rank                        Number  Grade                       Number
------------------------  --------  ------------------------  --------
Brigadier General (O-7)          0  Senior Executive                 1
Colonel (O-6)                    3  15                               5
Lieutenant Colonel (O-           3  14                               5
 5)
Major (O-4)                      4  13                               6
Captain (O-3)                    1  12                               4
First Lieutenant (O-2)           0  11                               1
======================================================================
Total                           11  Total                           22
----------------------------------------------------------------------
FORMAL EDUCATION ATTAINED

As shown in table VII.2, 29 of the 33 respondents held bachelor's
degrees.  Six managers majored in accounting, while 14 managers
reported other business-related majors. 



                              Table VII.2
                
                  Bachelor's Degree Majors Reported by
                    Marine Corps Financial Managers

                               Number of bachelor's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             1              5              6
Other business                         5              9             14
Nonbusiness                            5              4              9
======================================================================
Total degrees                         11             18             29
----------------------------------------------------------------------
As shown in table VII.3, 13 respondents also held master's degrees,
with 3 reporting more than one major.  The majors for these managers
were business related. 



                              Table VII.3
                
                   Master's Degree Majors Reported by
                    Marine Corps Financial Managers

                                Number of master's degree majors
                           -------------------------------------------
                                                         Total degrees
Majors                          Officers      Civilians       by major
-------------------------  -------------  -------------  =============
Accounting                             0              0              0
Other business                        11              5             16
Nonbusiness                            0              0              0
======================================================================
Total degrees                         11              5             16
----------------------------------------------------------------------
Twenty-nine of the 33 respondents reported completing one or more
courses in accounting-related subjects, as follows: 

  -- 1-2 subjects:  2 civilians,

  -- 3-5 subjects:  7 (2 officers and 5 civilians), and

  -- 6 or more subjects:  20 (8 officers and 12 civilians). 

Based solely on a review of their formal education, the respondents
in the latter group appear to have met the requirements to serve in
GS-510 accountant positions. 

PROFESSIONAL WORK EXPERIENCE
ACQUIRED

A review of the profiles showed that the average years of
professional work experience was 21 years for the 11 officers, with a
range of 15 to 28 years, and 26 years for the 22 civilians, with a
range of 12 to 42 years.  The respondents had spent most of their
careers in DOD.  Figures VII.1 and VII.2 show the average number of
years of work experience by rank for the officers and by grade for
the civilians, respectively. 

   Figure VII.1:  Professional
   Work Experience Reported by
   Marine Corps Financial
   Managers--Officers

   (See figure in printed
   edition.)

   Figure VII.2:  Professional
   Work Experience Reported by
   Marine Corps Financial
   Managers--Civilians

   (See figure in printed
   edition.)

Figures VII.3 and VII.4 show the number of officers and civilians who
indicated that they had performed each financial management function
previously outlined at sometime during their careers, and the average
number of years of experience in each function.  The financial
management function performed most frequently was financial analysis. 
A review of the profiles also showed that 7 officers and 13 civilians
had performed three or more of these functions. 

   Figure VII.3:  Experience in
   Financial Management Functions
   Reported by Marine Corps
   Financial Managers--Officers

   (See figure in printed
   edition.)

   Figure VII.4:  Experience in
   Financial Management Functions
   Reported by Marine Corps
   Financial Managers--Civilians

   (See figure in printed
   edition.)

TRAINING COMPLETED DURING 1995 AND
1996

Figure VII.5 shows the training reported by the 33 respondents as
being completed during 1995 and 1996. 

   Figure VII.5:  Training
   Reported by Marine Corps
   Financial Managers as Being
   Completed During 1995 and 1996

   (See figure in printed
   edition.)

A review of the profiles showed

  -- total receiving accounting-related training:  10 (4 officers and
     6 civilians),

  -- total receiving financial-related training:  18 (6 officers and
     12 civilians),

  -- total receiving training in general topics:  23 (5 officers and
     18 civilians), and

  -- total not receiving training:  8 (5 officers and 3 civilians). 

PROFESSIONAL CERTIFICATIONS HELD

A review of the profiles showed that, of the six managers holding one
or more professional certifications,

  -- three were CGFMs (one officer and two civilians),

  -- two civilians held other financial management certifications,
     and

  -- one civilian held nonfinancial management certifications. 

Of the 27 managers that did not hold any professional certifications,
10 were officers and 17 were civilians.  Figure VII.6 shows the types
of professional certifications reported by the Marine Corps financial
managers. 

   Figure VII.6:  Professional
   Certifications Reported by
   Marine Corps Financial Managers

   (See figure in printed
   edition.)

CGFM:  Certified Government Financial Manager

OFMC:  Other financial management certifications

NFMC:  Nonfinancial management certifications




(See figure in printed edition.)Appendix VIII
COMMENTS FROM THE DEPARTMENT OF
THE NAVY
========================================================= Appendix VII


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix IX

ACCOUNTING AND INFORMATION
MANAGEMENT DIVISION, WASHINGTON,
D.C. 

George H.  Stalcup, Associate Director
Geoffrey B.  Frank, Assistant Director
Robert L.  Self, Project Manager
Donald H.  Lentz, Auditor-in-Charge
Patricia A.  Summers, Senior Auditor
Linda J.  Brigham, Senior Auditor
Jan E.  Bogus, Senior Auditor
Francine M.  DelVecchio, Communications Analyst
Michelle A.  Howard, Intern

*** End of document. ***