Presentation on theme: "Pennsylvania Government Reform"— Presentation transcript:
1 Pennsylvania Government Reform Anna Maria Kiehl, CPAComptroller /Chief Accounting Officer,Office of Budget, Comptroller Operations
2 Commonwealth of Pennsylvania Financial Organization Structure Appointed by Executive Deputy Secretary of the BudgetAppointed by Secretary of BudgetAppointed by GovernorElected OfficialGovernorSecretary of BudgetExecutive Deputy Secretary of the BudgetComptrollerDirector of BudgetAuditor GeneralTreasurer2
3 Governor Tom Corbett’s Reform InitiativesPerformance-based Budgeting and a Biennial Budget CycleTransparency in State GovernmentConsolidation of ServicesReducing the Size of GovernmentPrivatization opportunities, e.g., state-owned wine and spirit storesOperational efficiencies – Travel Policy revisions/Out of State Travel restrictions, Management Salary Freezes, Vehicle Policy revisionsPension reformWelfare ReformSalary Freeze and Out of State Travel restrictionsFocus on Consolidations and Reform within and across state agenciesTask Force forming to review privatization opportunities, i.e., LCB, print shop, fleet carsTighter Travel policy and state-assigned vehicles policyIntroduction of Performance-based BudgetingPassed legislation requiring a searchable, on-line database for the publicEnhanced Accountability and Transparency - Passed legislation requiring a searchable, on-line database for the public
4 PA’s Ten Years of Continuous Improvements 2001200220032004200520062007200820092010ImaginePA - SAPBudget, Finance, Procurement, Reporting – (Start - March 2001)HR, Payroll (Start – March 2001)Go Live 3 Phases between July 2002 and January 2003Go Live January 2004SRM(Start - February 2006)Procurement Upgrade March 2007EBP Upgrade August 2006XML Go Live July 2007Go Live Training November 2007Revenue Initiative(Start - Within OB 2006)Agency Kick Off June 2007Reporting July 2008Finance Transformation(Start - February 2008)Scheduled Go Live – May 2009Go LiveMay and June 2009SAP Budget Control system(October June 2010)Go LiveJuly 2010
5 Comptroller Operations before transformation Inflexible Organizational StructureThe Office of the Budget had two bureaus and five comptroller offices providing accounting and payment services.Offices were aligned around agencies rather than business processes.This inefficient structure resulted in higher operating costs and payment delays.Inefficient, Costly ProcessesNonstandard processes and procedures in each office and bureauFrequent non-value-added handoffs of paper documentsLabor-intensive effort, often resulting in delayed payments to vendorsDuplicate scanning performed in Comptroller Operations and Treasury DepartmentPaper, Paper and MORE Paper!Paper invoices sent to hundreds of different locations across the state for processingThousands of paper documents stored in filing cabinetsExcessive annual mailing costs associated with transporting paper documentsNo visibility of invoice statusInflexible Organizational StructureThe Office of the Budget had two bureaus and five comptroller offices providing accounting and payment services.Offices were aligned around agencies rather than business processes.This inefficient structure resulted in higher operating costs and payment delays.Inefficient, Costly ProcessesNonstandard processes and procedures in each office and bureauFrequent non-value-added handoffs of paper documentsLabor-intensive effort, often resulting in delayed payments to vendorsDuplicate scanning performed in Comptroller Operations and Treasury DepartmentPaper invoices sent to hundreds of different locations across the state for processingThousands of paper documents stored in filing cabinetsExcessive annual mailing costs associated with transporting paper documentsNo visibility of invoice status
7 Major Changes Occurred in Three Areas: PEOPLEConsolidated 535 staff members in a central location and organized them around function.Implemented a centralized call center for state vendors, contractors and agency personnel.Established a Workforce Development and Training Office to provide financial, accountability and audit training to all commonwealth employees.Instituted a Quality Assurance function to assess and monitor the adequacy of internal controls, process design and performance metrics.
8 Major Changes Occurred in Three Areas: TECHNOLOGYCreated centralized post office boxes for the receipt and scanning of invoices to reduce sorting and handling costs.Integrated invoice images and electronic approval capabilities within the existing IT system for both purchase-order and non-purchase-order-related invoices.Expanded the use of electronic invoicing with utility companies to reduce payment time and processing costs and receive rebates.Employed electronic imaging of checks to expedite the recognition of commonwealth revenue, allowing for deposits to be synchronized with the financial reporting system.Developed reports and dashboards to improve invoice lifecycle visibility and performance metrics.
9 Major Changes Occurred in Three Areas: PROCESSDeveloped a completely paperless procure-to-pay process.Provided electronic real-time visibility of invoices.Eliminated non-value-added handling of paper invoices and revenue documents.Developed and documented standardized procedures for payables, revenue, accounting and auditing.Streamlined approval processes by removing requirements for duplicate approvals.Eliminated the printing of paper documents for certain revenue documents.Developed a reporting solution for required Federal stimulus section 1512 reporting.Formed an audit committee and implemented a risk-based audit approach to an annual, internal audit plan that is more aligned with the administration’s priorities.
10 … and realized significant benefits Standardization of policies and proceduresImproved allocation of resourcesCollocated staff for a more flexible organization and increased capacityMaximized the existing integrated, ERP system.New electronic invoice processIdentified areas for continuous process improvement/efficienciesImproved coordination and communication within commonwealth agencies.workflow technology
11 The Pennsylvania Office of Comptroller Operations BudgetSecretaryExecutive Deputy Secretary for Budget and CFOAudit CommitteeState Comptroller/Chief Accounting Officer, Office of Comptroller OperationsOffice of Workforce Development and TrainingBureau of Planning and ManagementBureau of Commonwealth Payroll OperationsBureau of Liquor Control Board ServicesBureau of Commonwealth AccountingBureau of Payable ServicesBureau of Financial ManagementBureau of Quality AssuranceBureau of Audits
12 Impressive Results in 24 Months Invoice ProcessingAll processing is paperless and approvals handled electronically between agencies and the comptroller.Scanned invoice images, contracts, purchase orders, and other supporting documentation are stored in a central repository for access by all agencies.Invoices are paid in 30 days unless later pay dates are agreed on in advance.Treasury ReviewTreasury is no longer scanning invoice a second time, reducing their invoice review by 5-11 days.Vendor AccountabilityVendor invoicing requirements were implemented for the first time in PA state government. Invoices are scanned within 24 hours and are presented to the State Treasurer on the average within 4-5 days of receipt.Vendor Self service to register to do business and look up payment statuses is available. More than 95% of calls to the Vendor Service Center are answered.Utility Billing15,000 utility invoices are received electronically each year. Late charges and shut off notices are no longer received.Elimination of “Paper Pushing”Several paperless initiatives have been worked to eliminate printing, handling, mailing and time. Scanning is done one time and stored in a central repository for all agencies.Human ResourcesDoing more with less – consolidation of offices led to a reduction of positions through attrition.Many professional positions were transitioned from civil service to non-civil service to enable management to get the right people in the right positions.AccountingDecentralized revenue accounting to recognize revenues sooner and implemented an Image Capture Letter process for the deposit of checks.AuditingState-wide internal audit function -mandated audits and enterprise-wide risk assessments. An audit committee also advises the Comptroller and audit director.
15 The Impact of Finance Transformation on Comptroller Operations
16 The Comptroller’s role in current Government Reform initiatives Support of the Governor’s Transparency project – Penn Watch portalElimination of Travel Per Diems – system, process, and policy changesStrengthening of Financial Policies and Management ControlsSupport for Privatization of State-owned Wine & Spirit storesContinuous Identification of Process and System ImprovementsCollaboration with other agencies to save costs, eliminate redundancy & paperUsing Internal Audits and a statewide audit committee to focus audit resourceson riskExpansion of Purchasing card and pursuing Vendor discounts