Results Act: Observations on the Department of the Interior's Draft
Strategic Plan (Correspondence, 07/18/97, GAO/RCED-97-207R).
Pursuant to a congressional request, GAO reviewed the draft strategic
plan submitted by the Department of Interior as required by the
Government Performance and Results Act.
AGAO noted that: (1) while Interior has made progress in developing its
draft strategic plan, the plan does not yet fulfill the Results Act's
requirements; (2) in many cases, the pan does not include the six key
elements required by the Results Act; (3) Interior's Department-wide
strategic overview does contain the Department's overall mission and
goals and refers to the subagency plans for information on the six
required elements, but half of the eight subagency plans were incomplete
and lacked two or more of the six required elements; (4) the overall
quality of Interior's strategic plan is not yet sufficient to achieve
the purposes of the Results Act; (5) the plan does not include clear
linkages between the agencies' goals and objectives and the
contributions of these goals and objectives to the Department's major
goals or commitments; (6) Interior's draft strategic plan reflects a
consideration of the key statutory authorities authorizing Interior's
programs; (7) however, the Department-wide strategic overview and the
subagency plans do not generally present clear linkages between the
stated goals and objectives and Interior's relevant statutory
responsibilities; (8) the Results Act does not require an agency's
strategic plan to contain a statement of statutory authorities; (9)
however, GAO believes that including such linkages may facilitate a
better understanding of the diversity and complexity of Interior's
overall mission, goals, and objectives; (10) a number of cross-cutting
issues need to be addressed in Interior's draft strategic plan to
prevent duplication and overlap; (11) GAO's past work at the Department
has identified several examples indicating where improved coordination
should have occurred; (12) while Interior has identified information
management resource goals in its strategic plan, how it plans to achieve
and measure the success of those goals is not clearly delineated; (13)
Interior's draft strategic plan states that a key to the Results Act's
implementation will be the availability of timely and reliable financial
information that will permit decisionmakers to track progress and
evaluate the results of Interior's programs; (14) to achieve this
overall goal, Interior has identified specific goals of strengthening
financial operations and resource management; and (15) in this light,
Interior needs to continue to address certain accounting systems and
internal control weaknesses that, if not fully corrected, could affect
the reliability of program and performance information.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: RCED-97-207R
TITLE: Results Act: Observations on the Department of the
Interior's Draft Strategic Plan
DATE: 07/18/97
SUBJECT: Interagency relations
Strategic planning
Program evaluation
Congressional/executive relations
Agency missions
Federal agency accounting systems
Information resources management
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Cover
================================================================ COVER
September 1997
GAO/RCED-97-207R
Department of the Interior's Draft Strategic Plan
(141078)
Abbreviations
=============================================================== ABBREV
BIA - Bureau of Indian Affairs
BLM - Bureau of Land Management
BOP - Federal Bureau of Prisons
BOR - Bureau of Reclamation
CFO - Chief Financial Officers
DEA - Drug Enforcement Administration
DOJ - Department of Justice
FBI - Federal Bureau of Investigation
FWS - Fish and Wildlife Service
INS - Immigration and Naturalization Service
MMS - Minerals Management Service
NPR - National Performance Review
NPS - National Park Service
OMB - Office of Management and Budget
OSM - Office of Surface Mining
USGS - Geological Survey
Letter
=============================================================== LETTER
B-277452
July 18, 1997
The Honorable Richard K. Armey
Majority Leader
House of Representatives
The Honorable John R. Kasich
Chairman
Committee on the Budget
House of Representatives
The Honorable Dan Burton
Chairman
Committee on Government Reform
and Oversight
House of Representatives
The Honorable Bob Livingston
Chairman
Committee on Appropriations
House of Representatives
Subject: Results Act: Observations on the Department of the
Interior's Draft Strategic Plan
On June 12, 1997, you asked us to review the draft strategic plans
submitted by the Cabinet Departments and selected major agencies for
your consultation with the Congress as required by the Government
Performance and Results Act of 1993 (the Results Act). This report
is our response to that request concerning the Department of the
Interior.
OBJECTIVES, SCOPE, AND
METHODOLOGY
------------------------------------------------------------ Letter :1
Specifically, you asked us to review Interior's draft plan and assess
(1) whether it fulfills the requirements of the Results Act and to
provide our views on its overall quality; (2) whether it reflects
Interior's key statutory authorities; (3) whether it reflects
interagency coordination for crosscutting programs, activities, or
functions that are similar or complementary with those of other
federal agencies; (4) whether it addresses management problems that
we have previously identified, and (5) the adequacy of Interior's
data and information systems for providing reliable information for
measuring results.
We obtained the version of the draft strategic plan that Interior
provided congressional committees with as of June 18, 1997.\1
Interior's draft strategic plan includes a Department-wide strategic
overview as well as eight subagency plans.\2 The eight subagencies
within Interior are the Bureau of Land Management (BLM), the Minerals
Management Service (MMS), the Office of Surface Mining (OSM), the
Bureau of Reclamation (BOR), the Geological Survey (USGS), the Fish
and Wildlife Service (FWS), the National Park Service (NPS), and the
Bureau of Indian Affairs (BIA). We reviewed the overview and the
subagency plans because Interior considers them, as a whole, to
constitutes its strategic plan for purposes of the Results Act. In
addition to providing the broad framework for the agency, the
Interior's strategic overview is intended to provide linkages between
the departmental level and the individual subagency plans.
It is important to recognize that the final plan is not due to the
Congress and the Office of Management and Budget (OMB) until
September 1997. Furthermore, the Results Act anticipated that it may
take several planning cycles to perfect the process and that the
final plan would be continually refined as future planning cycles
occur. Thus, our findings reflect a snapshot status of the plans at
this time. We recognize that developing a strategic plan is a
dynamic process and that the Department of Interior, OMB, and
congressional staff are continuing to revise the draft.
Our overall assessment of Interior's draft strategic plans was
generally based on our knowledge of agencies' operations and
programs, our numerous reviews of Interior's agencies, and other
existing information available at the time of our assessment.
Specifically, the criteria we used to determine whether Interior's
draft strategic plan complied with the requirements of the Results
Act were the Results Act, supplemented by OMB's guidance on
developing the plans (Circular A-11, Part 2). To make judgments
about the overall quality of the plan and its components, we used our
May 1997 guidance for congressional review of the plans
(GAO/GGD-10.1.16). In determining whether Interior's draft strategic
plan reflects its major statutory responsibilities, we coordinated
our review with the Congressional Research Service, reviewed material
in Interior's 1998 budget explanatory notes for an overview of the
Department's primary functions and activities, and reviewed statutory
provisions relating to Interior. To determine whether the plan
contained information on interagency coordination and addressed
management problems that we previously identified, we relied on our
general knowledge of Interior's operations and programs and the
results of our previous reports. To determine whether Interior had
adequate systems to provide reliable information on performance, we
reviewed the Department-wide plan for financial management and the
subagency plans for the Chief Financial Officer and the Chief
Information Officer. We also relied on the results of our previous
reports and those of Interior's Office of Inspector General (OIG).
Our work was performed in June and July 1997. We obtained comments
on a draft of this report from Interior.
--------------------
\1 There is one exception to this cutoff date. The Congress was not
provided with the subagency portion of the plan from the Fish and
Wildlife Service, dated May 22, 1997, until after June 18, 1997.
However, we included the subagency portion in our analysis because it
was substantially revised from the version that the Congress received
prior to June 18th.
\2 As used in this report, "subagency" refers to agencies and bureaus
within Interior.
BACKGROUND
------------------------------------------------------------ Letter :2
As the caretaker of the nation's natural resources and much of our
cultural heritage and as custodian of our responsibilities to Native
Americans, Interior's responsibilities cover a broad range of
activities. For the most part, these activities are carried out
through eight subagencies within Interior. Given this organization,
Interior officials included eight subagency plans as part of the
Department's draft strategic plan.
Interior's Department-wide strategic overview defines the common
mission for the Department as follows: "to protect and provide
access to our nation's natural and cultural heritage and honor our
trust responsibilities to tribes." From this common mission, the
Department-wide strategic overview identifies 10 overarching themes
called "commitments" that guide the development of the subagency
strategic plans. Furthermore, the Department has identified two
strategic goals that crosscut subagencies' responsibilities. These
goals involve (1) developing natural resource management partnerships
with other federal, state, local, and private entities and (2)
improving departmental management processes and functions.
The Results Act requires that an agency's strategic plan contain the
following six critical components: (1) a comprehensive mission
statement; (2) agencywide long-term goals and objectives for all
major functions and operations; (3) approaches (or strategies) and
the various resources needed to achieve the goals and objectives; (4)
a relationship between the long-term goals and objectives and the
annual performance goals; (5) an identification of key factors,
external to the agency and beyond its control, that could
significantly affect the achievement of the strategic goals; and (6)
a description of how program evaluations were used to establish or
revise strategic goals and a schedule for future program evaluations.
In this report, we consider Interior's draft strategic plan to be a
combination of the Department-wide strategic overview and the
included subagency plans.
RESULTS IN BRIEF
------------------------------------------------------------ Letter :3
While Interior has made progress in developing its draft strategic
plan, the plan does not yet fulfill the Results Act's requirements.
In many cases, the plan does not include the six key elements
required by the Results Act. Interior's Department-wide strategic
overview does contain the Department's overall mission and goals and
refers to the subagency plans for information on the six required
elements. But half of the eight subagency plans were incomplete and
lacked two or more of the six required elements. The overall quality
of Interior's strategic plan is not yet sufficient to achieve the
purposes of the Results Act. The plan does not include clear
linkages between the agencies' goals and objectives and the
contributions of these goals and objectives to the Department's major
goals or commitments. In addition, some of the goals and objectives
in the subagency plans are not stated in a manner that allows for a
future assessment of whether the goals have been or are being
achieved.
Interior's draft strategic plan reflects a consideration of the key
statutory authorities authorizing Interior's programs. However, the
Department-wide strategic overview and the subagency plans do not
generally present clear linkages between the stated goals and
objectives and Interior's relevant statutory responsibilities. The
Results Act does not require an agency's strategic plan to contain a
statement of statutory authorities. However, we believe that
including such linkages may facilitate a better understanding of the
diversity and complexity of Interior's overall mission, goals, and
objectives.
A number of cross-cutting issues need to be addressed in Interior's
draft strategic plan to prevent duplication and overlap. Our past
work at the Department has identified several examples indicating
where improved coordination should have occurred. For example, while
the plan points out that coordination among Interior's subagencies
will be done for some of the natural resource partnership initiatives
identified in the plan, it does not indicate that the kind of
mission-oriented reexamination of the processes and structures
suggested by our work has or will be done.
While Interior has identified information management resource goals
in its strategic plan, how it plans to achieve and measure the
success of those goals is not clearly delineated. Traditionally,
Interior has allowed its subagencies to independently acquire and
manage information technology. This culture has resulted in
inefficiencies in technology investments and information sharing.
Interior's draft strategic plan states that a key to the Results
Act's implementation will be the availability of timely and reliable
financial information that will permit decisionmakers to track
progress and evaluate the results of Interior's programs. To achieve
this overall goal, Interior has identified specific goals of
strengthening financial operations and resource management. In this
light, Interior needs to continue to address certain accounting
systems and internal control weaknesses that, if not fully corrected,
could affect the reliability of program and performance information.
INTERIOR'S DRAFT STRATEGIC PLAN
DOES NOT YET FULFILL THE
REQUIREMENTS OF THE RESULTS ACT
------------------------------------------------------------ Letter :4
While Interior has made progress in developing its draft strategic
plan, a significant amount of work still needs to be done before the
plan can fulfill the requirements of the Results Act. Interior's
draft strategic plan does not yet contain all six elements required
by the Results Act. Half of the subagency plans (four of eight) are
missing required elements. Furthermore, even those that include all
required elements need further work and development in several key
areas. In addition, the draft strategic plan does not yet represent
a comprehensive strategy to accomplish Interior's mission because it
lacks some of the key attributes necessary for making the strategic
planning process successful.
INTERIOR'S DRAFT PLAN DOES
NOT CONTAIN ALL SIX REQUIRED
ELEMENTS
---------------------------------------------------------- Letter :4.1
Interior's Department-wide strategic overview provides a mission
statement for the Department and lays out 10 general goals referred
to in the plan as "commitments." For example, the strategic overview
establishes a goal of restoring and maintaining the health of
federally managed lands and preserving our nation's natural and
cultural heritage for future generations. For more information on
strategies for achieving the goals; the relationships between
long-term goals and annual performance goals; key factors external to
the Department or subagency that could affect the achievement of the
goals; and the use of program evaluations to establish goals and to
modify them in the future; the Department-wide strategic overview
refers to the subagency plans.
Our review of the eight subagency plans shows that half of the plans
did not contain all six of the elements required by the Results Act.
For those agencies which did not include all required elements, each
of the subagency plans contained information on their mission and
goals and objectives, but the information provided for the remaining
four required elements varied as follows:
-- Two of the eight subagencies (BIA and FWS) did not discuss the
approaches or strategies for achieving goals and objectives.
-- Four of the eight subagencies either did not sufficiently
address the relationship between long-term goals and annual
performance goals (NPS and FWS) or did not address it at all
(BIA and MMS). In the case of NPS and FWS, the subagency
components did not specifically address the links between
long-term goals and annual performance measures.
-- Two of the eight subagencies (NPS and FWS) did not discuss the
impact that external factors could have on their ability to
achieve their goals.
-- Four of the eight subagencies (NPS, BIA, FWS, and MMS) had
little or no discussion about how or whether program evaluations
were used to develop the plan and did not include schedules of
future program evaluations.
While many of the subagencies' plans included discussions that
related to the required elements, the information provided was
frequently incomplete and often not relevant or directly linked to
the goals and objectives stated in the plans. For example, while six
of the eight draft subagency plans discussed the external environment
facing them, several of the subagencies did not address how these
external factors could affect the subagency's ability to achieve
specific goals and objectives. Similarly, not providing a discussion
of whether and how program evaluations were used in developing the
plan is important not because it is required but because without this
information, it is difficult for both the subagencies and other users
of the plan to have confidence that the former's goals are the
correct ones and that its strategies will be effective.
OBSERVATIONS ON THE OVERALL
QUALITY OF THE PLAN
---------------------------------------------------------- Letter :4.2
While Interior has made progress in developing its draft strategic
plan, the plan does not yet fulfill the requirements of the Results
Act. Collectively, the Department-wide overview and the subagency
plans are not yet sufficient to provide a comprehensive strategy for
Interior or achieve the purposes of the act, such as improved program
effectiveness, management, and public accountability and confidence
in the Department or subagencies, for the following reasons:
-- As stated previously, many of the subagency plans are
incomplete. Until the subagency plans are complete, they cannot
provide an overall guide for helping agencies to set priorities
and allocate resources consistent with these priorities.
Furthermore, because all of the required elements are not
included, complete information has not been available for the
congressional consultation process.
-- While the subagency plans generally provided some discussion of
how the goals contained in the plans are to be achieved, most of
the subagency plans did not discuss the amount of
resources--human, capital, or information--that would be needed
to implement their strategy. For example, neither USGS, OSM,
nor MMS provided details of the extent of resources needed to
implement its goals and objectives. Explaining the amount of
resources needed to carry out the plan is vital to achieving a
full understanding of the trade-offs, costs, and commitments
needed to achieve the goals and objectives in the plans.
-- Most of the subagency plans did not include clear linkages
between the subagencies' goals and objectives and the
contributions of these goals and objectives to the Department's
major goals. Furthermore, the Department's strategic overview
does not link its Department-wide goals or "commitments" back to
the subagencies. These linkages are important because the goals
and objectives (1) set out the long-term programmatic policy and
goals of the Department as a whole and (2) provide the
subagencies' staff with direction and guidance toward actions
that fulfill the overall mission of both the Department and the
subagencies.
-- Some of the goals and objectives in the subagency plans are not
stated in a manner that will allow a future assessment of
whether the goals have been or are being achieved. For example,
one of BOR's goals is to "manage the nations western water
resources wisely for present and future generations." While not
all the goals must be stated in a quantitative fashion, some of
the goals in the subagency plans are stated so broadly that they
are inherently unmeasurable, either directly or through the use
of performance measures.
-- Although several of the subagency plans provide some information
on performance measures, the information is sometimes not
sufficient to show the relationship between the subagencies'
strategic goals and the performance goals to be included in the
subagencies' annual performance plans.
KEY STATUTORY AUTHORITIES ARE
REFLECTED IN THE STRATEGIC PLAN
------------------------------------------------------------ Letter :5
Interior's draft strategic plan reflects consideration of the key
statutory authorities authorizing Interior's programs. However, the
Department-wide strategic overview and the subagency plans do not
generally present clear linkages between their stated goals and
objectives and Interior's relevant major statutory responsibilities.
The Results Act does not require that a statement of major statutory
responsibilities be included with the agency's goals and
objectives.\3 Nevertheless, we believe that including such linkages
in the subagency plans may facilitate a better understanding of the
diversity and complexity of Interior's overall mission and the goals
and objectives of its constituent agencies. For example, the plan
for BOR provides few linkages between the large number of outcome
goals and 5-year strategic goals and its many different statutory
authorities. The plan contains 18 outcome goals and over 60 5-year
strategic goals that contain few statutory references. As another
example, BIA's subagency plan does not provide clear statutory
linkages with its performance goals and strategies. Sample
performance goals related to education, resources management, public
safety and justice, and trust services do not identify what relevant
statutes authorize such activities. In commenting on a draft of this
report, Interior noted that while it may not be necessary to include
linkage between authorities' and agencies' goals and objectives, the
Department plans on including an attachment to its final strategic
plan that identifies these links.
--------------------
\3 OMB Circular A-11 suggests that an agency's mission statement may
include a brief discussion of the agency's enabling or authorizing
legislation. This suggestion, however, does not extend to the
statement of goals and objectives.
CROSSCUTTING ACTIVITIES NEED TO
BE ADDRESSED IN THE INTERIOR
PLAN
------------------------------------------------------------ Letter :6
Historically, Interior has been a highly decentralized agency. As a
result, Interior has allowed its subagencies, for the most part, to
develop their own systems and processes for managing their programs.
Our past work at the Department has identified several areas where
improved coordination should have occurred to address issues of
duplication and overlap.
The federal government now owns about 30 percent (about 650 million
acres) of the nation's total surface area. Four federal land
management agencies manage about 95 percent of these lands for a
variety of commodity uses--including hardrock mining, livestock
forage, oil and gas exploration and development, and timber
harvesting--and noncommodity uses--including fish and wildlife;
natural, scenic, cultural, and historic resources; recreation; water;
and wilderness. These four agencies are the Forest Service (FS) in
the US Department of Agriculture and NPS, BLM, and FWS in Interior.
Our work has shown that the responsibilities of these four agencies
have become similar over time.\4 Most notably, FS and BLM now provide
more noncommodity uses like recreation and protection for fish and
wildlife on their lands. At the same time, managing these lands has
become more complex. Managers have to reconcile differences among a
growing number of laws and regulations, and the authority for the
administration of these laws is dispersed among several federal,
state, and local agencies. These changes have coincided with two
other developments--the federal government's increased emphasis on
downsizing and budgetary constraint and scientists' increased
understanding of the importance and functioning of natural systems
whose boundaries may not be consistent with existing jurisdictional
and administrative boundaries of federal, state and local agencies.
Together, these conditions suggest a basis for reexamining the
processes and structure under which the federal land management
agencies--Interior and FS--currently operate. The strategic planning
process required under the Results Act and the development of the
overall Interior plan provides this opportunity. While the plan
points out that coordination with FS and among Interior's agencies
will be done for some of the natural resource partnership initiatives
identified in the plan, it does not indicate that the kind of
mission-oriented reexamination of the processes and structures
suggested by our work has been done.
In commenting on this point the Department noted in the past that
this has been a controversial issue with the Congress and that the
partnership efforts currently described in its draft strategic plan
represent an effort to deal with this kind of cross-agency situation
in a seamless way without addressing organizational structures. In
its view, unless the Congress changes Interior's statutory
responsibilities, the strategic plan must reflect the Department's
current mission. We acknowledge that this is a difficult and
controversial issue. However, it is this type of mission-oriented
issue that needs to be addressed as part of a strategic planning
process. Addressing this issue in the draft strategic plan would
facilitate a dialogue on the issue during consultations between
Interior and the Congress.
Interior has several other broad crosscutting programs where a
coordinated strategic planning process would help to provide
Department-wide information on program results as follows:
-- Environmental protection and remediation programs. Interior
currently lacks a complete inventory of hazardous materials and
abandoned mines sites to support management and financial
reporting. Interior's environmental programs are managed
primarily by BLM, FWS, NPS, BIA, BOR, and Interior's Office of
Environmental Policy Compliance. In addition, BOR's draft plan
addresses reducing, on a site-specific basis, the sources of
pollution that affect water quality, and USGS' plan addresses
water quality studies.
-- Stewardship assets. Interior's BLM, FWS, and NPS have
implemented early the new federal accounting standards for
reporting on stewardship land and heritage assets (parks,
recreation and wildlife areas, buildings, monuments, and museum
collections). By developing Department-wide guidelines for
stewardship reporting and adequate inventory systems in
subagencies for tracking, managing, and reporting on these
assets, Interior would ensure that consistent and reliable data
are available.
-- Indian Programs. Most of Interior's subagencies (BIA, BLM, BOR,
USGS, MMS, OSM, and the Office of the Secretary, and that
Office's Office of the Special Trustee for American Indians and
Office of American Indian Trust) have a role in helping Interior
to carry out its trust responsibility to American Indians and
tribes. However, Interior lacks adequate systems and financial
and program information to effectively manage and budget for
Indian programs. The strategic plan for Indian trust fund and
asset management proposes consolidating Indian financial and
asset management programs and upgrading and acquiring new
systems.
-- Land and Natural Resource Management. Interior's BLM, FWS, and
NPS are responsible for managing federal land and natural
resources, and BIA is responsible for these functions on federal
Indian land. In addition, Interior's OSM is responsible for
regulating mining activity on federal and Indian land, MMS
enforces oil and gas leases on the Outer Continental Shelf, and
USGS performs studies, investigations, and mapping services
related to land and natural resources. Interior needs to
develop adequate crosscutting information on the effectiveness
of these agencies.
-- Recreation programs. Interior's BLM, BOR, FWS, and NPS manage
programs that provide numerous recreational opportunities for
the public. Interior's plan states that Interior will continue
to promote and provide these opportunities where they are
consistent with other land uses and with maintaining the health
of the land.
Interior's plan, when completed, is to include information on its
component agencies' mission statements and goals. However, it is not
clear in the draft strategic plan which, if any, of the issues
identified in our work were addressed. A Department-wide framework
for identifying and measuring crosscutting programs and goals will
help to determine the overall cost or effectiveness of these
programs. In addition, Interior will have reliable information for
setting priorities and formulating budgets.
In commenting on a draft of this report, Interior noted that (1) a
discussion of crosscutting issues is not required by the Results Act
and (2) the Department is involved with a number of activities that
address issues of coordination both within and outside of Interior.
The Department's comments on both of these points are correct.
However, a focus on results, as envisioned by the Results Act,
implies that federal programs contribution to the same or similar
results should be closely coordinated to ensure that goals are
consistent, and, as appropriate, program efforts are mutually
reinforcing. We believe the strategic planning process offers an
opportunity to discuss matters of overlap and duplication like, for
example, those identified in our past work. Furthermore, while the
Department is engaged in a number of coordinating activities, there
is nothing in the plan that demonstrates that these activities are
linked to the cross-cutting matters noted in this report.
--------------------
\4 Federal Land Management: Streamlining and Reorganization Issues
(GAO/T-RCED-96-209, June 27, 1996).
INTERIOR'S STRATEGIC PLAN NEEDS
TO MORE FULLY ADDRESS
INFORMATION MANAGEMENT ISSUES
------------------------------------------------------------ Letter :7
The Paperwork Reduction Act of 1995 and the Clinger-Cohen Act of 1996
direct agencies to implement a framework of modern technology
management on the basis of practices followed by leading private and
public sector organizations that have successfully used technology to
improve performance and help meet strategic goals. Interior has
identified goals and actions needed to implement the provisions of
these Acts in its draft strategic plan. However, how Interior plans
to achieve and measure the success of these goals and actions is not
clearly discussed in the draft strategic plan.
Traditionally, Interior has allowed its subagencies to independently
acquire and manage information technology. This culture has resulted
in inefficiencies in technology investments and information sharing.
For example, in May 1997, we reported that Interior had not
systematically identified and acted on opportunities to consolidate
and share telecommunications resources within and among its bureaus
or its 2,000-plus field locations.\5 Instead, the Department has
relied on its subagencies to independently identify and act on such
opportunities. To its credit, Interior has undertaken a number of
telecommunications cost-savings initiatives that have produced
significant financial savings and helped reduce the Department's more
than $62 million annual telecommunications investment. In addition,
in commenting on a draft of this report, Interior stated that
progress has been made in overcoming its long history of component
agency autonomy as it relates to information systems, such as the
successful consolidation of some of its information and financial
systems. We have not yet had an opportunity to fully review and
assess the Department's progress in this area.
While the draft strategic plan sets information technology goals, it
does not describe how the Department will overcome these problems and
ensure the efficient and effective use of information resources
across the Department. Furthermore, Interior, like many agencies,
will face the emerging management challenges of implementing modern
technology and resolving the need for computer systems to be changed
to accommodate dates beyond 1999--the "year 2000" problem.
Consequently, in developing its information technology strategy,
Interior needs to be sure to explain how it plans to address the
"year 2000 problem" as well as any significant information security
weaknesses--two issues that we have identified as high risk areas
across the government.\6
In commenting on a draft of this report, Interior told us that
because of the level of detail required, it did not address
strategies for resolving the "year 2000" problem in its draft
strategic plan. Similarly, Interior did not address information
security because it regards this area as a management and operational
responsibility that needs attention on a daily basis. We believe
that it is appropriate for these items to be addressed in the plan to
convey how the Department intends to deal with them and provide
linkages to its operational and management plans. This disclosure
would also help the Congress, departmental customers, and the general
public to better understand the Department's goals, strategies, and
measures.
--------------------
\5 Telecommunications Management: More Effort Needed by Interior and
the Forest Service to Achieve Savings (GAO/AIMD-97-67, May 8, 1997).
\6 GAO High-Risk Series (GAO/HR-97-20, Feb. 1997).
INTERIOR NEEDS TO CONTINUE
IMPROVING ITS FINANCIAL
INFORMATION TO ACCURATELY
MEASURE PROGRESS TOWARD
ACHIEVING STRATEGIC AND
PERFORMANCE GOALS
------------------------------------------------------------ Letter :8
To support the implementation of the Results Act, Interior's
strategic plan states that a key ingredient will be the availability
of timely and reliable financial and program information that will
permit decisionmakers to track progress and evaluate the results of
Interior's programs. To achieve this overall goal, Interior has
identified specific goals of strengthening financial operations and
information resource management.
Interior has made progress in addressing past problems with its
management of financial information. For fiscal year 1996, the
Department received unqualified audit opinions on all but one of its
subagency financial statements. Nonetheless, work still needs to be
done in this area. Our work and that of the Interior Inspector
General has shown that Interior needs to continue to address certain
accounting and financial management system and internal control
weaknesses that could affect the reliability of program level
financial and performance information. For example, OIG audits
completed in the past year have identified weaknesses in accounting
for investments in fixed assets and project cost accounting and
controls that, if uncorrected, could affect the effectiveness of
Interior's Results Act's implementation.\7
Furthermore, Interior's and its component agencies' draft strategic
plans could be strengthened if they addressed how financial
information will be used to support the measurement of progress
toward strategic goals. Identifying performance measures and
ensuring the development of reliable financial and program
performance information will help to ensure the effective
implementation of the Results Act for Interior and its subagencies.
Like other agencies, once Interior develops key performance measures
it will need to consider appropriate system modifications to capture
data needed for performance measurement. Key requirements of the CFO
Act are the development of cost information to enable the systematic
measurement of performance and the integration of systems--program,
accounting, and budget systems.
--------------------
\7 Bureau of Land Management Combined Comparative Financial
Statements for Fiscal Years 1995 and 1996, U.S. Department of the
Interior, Office of the Inspector General (Report No. 97-I-319, Jan.
1997). Bureau of Indian Affairs Consolidated Financial Statements
for Fiscal Years 1995 and 1996, U.S. Department of the Interior,
Office of the Inspector General, (Report No. 97-I-834, May 1997).
AGENCY COMMENTS AND OUR
EVALUATION
------------------------------------------------------------ Letter :9
We provided Interior with copies of a draft of this report for review
and comment. We met with Interior's Assistant Secretary for Policy,
Management, and Budget and other officials. The Department raised a
number of substantive concerns about the draft report including
concerns about the portion of the report dealing with the
Department's crosscutting activities. We have addressed many of
those concerns in the body of the report. In addition to those
comments already acknowledged and discussed in the report, the
Department provided us with a number of additional comments.
With regard to our assessment of the key elements required by the
Results Act, the Department agreed that the report was an accurate
assessment of Interior's strategic plan as it was developed in June.
While they agreed that some additional work is needed, they
emphasized that the strategic planning process is an iterative
process that is evolving and that more recent drafts of the plan are
filling some of the gaps identified in our report. They indicated
that the plan will meet all statutory requirements of the Results Act
when it is completed in September 1997.
Interior raised serious concerns that the statements in the draft
report about the reliability of its financial management systems and
internal controls were too broad and were, therefore, misleading. It
was not our intent to characterize the Department's systems and
controls as deficient on the whole. Accordingly, we revised the
appropriate sections of the report to reflect specific areas where
improvements are needed in systems and controls to help ensure the
reliability of information used in the Results Act's implementation
and provided specific examples.
Furthermore, while acknowledging some deficiencies in its financial
management, the Department does not view these as being "major
management challenges" as characterized in the draft report. The
Department provided us with additional information to support its
comments. Because of the timing and scope of the review, we have not
yet had an opportunity to fully review and assess the Department's
progress in addressing past deficiencies. As a result, we modified
the report to reflect these concerns. As part of our future work at
Interior, we plan to review the effectiveness of the measures taken
by the Department.
---------------------------------------------------------- Letter :9.1
As agreed with your offices, unless you publicly announce its
contents earlier, we plan no further distribution of this report
until 30 days from the date of this report. At that time, we will
send copies of this report to the Ranking Minority Member of your
Committees, to the Chairman and Ranking Minority Member of the House
Resources Committee, the Secretary of Interior, and the Director,
Office of Management and Budget. We will send copies to others on
request.
Please contact me at (202) 512-3841 if you or your staff have any
questions concerning this report.
Sincerely yours,
Victor S. Rezendes
Director, Energy, Resources
and Science Issues
*** End of document. ***