DRAFT MA PWS_Army FIAR_Description of Services.pdf

DRAFT

DRAFT PERFORMANCE WORK STATEMENT (PWS)

DESCRIPTION OF SERVICES ONLY

Army General Fund Audit Support Contract

Deputy Assistant Secretary of the Army (Financial Operations)

Date, Month, Year

Performance Work Statement

DESCRIPTION OF SERVICES ONLY

Table of Contents

SECTION A: DESCRIPTION OF SERVICES

1. General

2. Description of Services/Introduction

3. Background

4. Scope

4.1 Major Objectives

4.2 Major Areas of Support/Task Areas

4.3 Sustainment

5. Task Description and Period of Performance

6. Deliverables

7. Performance Standards

SECTION A: DESCRIPTION OF SERVICES

1. General This is a non-personal service(s) contract as defined in Federal Acquisition Regulation Subpart

37.101 (effective Sept. 7, 2023) under which the personnel rendering the service(s) are not subject by the contract’s terms or by the manner of its administration, to the supervision and control usually prevailing in relationships between the Government and its employees. The United States Department of the Army (“Army”) requires the expertise of an organization to provide accounting, auditing solutions, and change management support, ultimately leading the Army to an unmodified audit opinion of its financial statements. This continuing effort over past decades requires contractors with extensive accounting and financial audit readiness/remediation experience within the Federal, private and/or public sector with complex organizations and IT systems.

2. Description of Services/Introduction This is a non-personal services contract to provide the Army with professional Federal accounting and auditing solutions and change management support to assist the Army to an unmodified audit opinion of its financial statements. The contractors shall (1) improve the completeness, accuracy, reliability and timeliness of Army financial data and information, (2) identify business process risk and establish an effective financial internal control environment, processes and procedures, (3) understand and improve the production of Army’s annual and quarterly Financial Statements and footnotes, (4) modernize capabilities through innovative technologies, business process re-engineering, and software development, and (5) provide alignment of strategy to efforts through governance, communications, and knowledge management.

3. Background Over the past several years, the Army has established a robust Financial Improvement and Audit Remediation (FIAR) Program for the Army General Fund (GF) focusing in the areas of Accountability, Risk Management, Financial Reporting, Technology Modernization, and Audit Remediation that encompasses all Army Major Commands and crosses numerous functional components including service provider interface and coordination. The Office of the Deputy Assistant Secretary of the Army for Financial Operations & Information (DASA-FOI) administers the monitoring and execution of the Army’s Risk Management and Internal Control (RMIC), Financial Reporting, and Audit programs.

In 2023, the Army GF underwent an audit of its consolidated financial statements, assisted by its Independent Public Accountant (IPA) firm, KPMG LLP. However, KPMG was unable to express an opinion due to insufficient audit evidence provided by the Government. Strengthening audit practices and performance improvement initiatives are key priorities in the Department of Defense's 2022 National Defense Strategy (NDS) and Fiscal Year 2025 budget. The Army is committed to enhancing its processes to ensure that reliable financial data drives informed decision-making.

The FIAR program has matured from a “Discovery” phase to its current phase as an audit response, remediation, and sustainment-centric program. As such, the financial environment and related key internal controls are thoroughly tested for effectiveness, reliability, and sustainability.

These efforts require a substantial investment in time and resources to assist the Army, its Commands, and service providers to achieve its overall goal of creating a financial environment that is accurate, reliable, timely, and auditable. Contractor support shall assist Army in achieving Army Audit Roadmap milestones and objectives, including driving toward the achievement of an audit opinion by FY 2027.

4. Scope

4.1 Major Objectives

Contractor support is required to meet the Army’s major objectives. The goals of Army General Fund (led by DASA-FOI) audit support are:

• Improve the completeness, accuracy, reliability and timeliness of Army financial data and information; drive decision-making and performance measurement through standard enterprise data and analytics

• Modernize capabilities through innovative technologies, business process re-engineering, and software development, including consolidating and reducing feeder and general ledger systems into modernized systems employing standard business processes

• Continue full scope audit with total transparency; prioritize and remediate findings, strengthen the internal control environment, and improve the accuracy of financial reports (e.g., Army annual and quarterly Financial Statements and footnotes)

• Support delivery of Army Audit Roadmap milestones and objectives, including achievement of an audit opinion by FY 2027

• Rigorously execute the Army’s budget; pursue budgetary reform seeking greater execution effectiveness and transparency

• Contribute to building a culture of strong program and change management

4.2 Major Areas of Support/Task Areas

Major areas of support/tasks areas consist of:

4.2.1 Audit Remediation and Response

4.2.2 Audit Facilitation / Support

4.2.3 Financial Reporting and Accounting Information

4.2.4 Financial Policy, Standardized Business Processes, and

Budgetary Reform

4.2.5 Internal Controls Institutionalization

4.2.6 Systems Consolidation, Modernization, and

Implementation

4.2.7 Financial Data Environment

4.2.8 Task Order Project Management

4.2.1 Task Area One: Audit Remediation and Response

The contractor shall assist the Army in achieving auditability of the Army GF by proposing realistic and sustainable solutions and assisting with the development and implementation of corrective action plans (CAPs) to remediate known and emergent deficiencies within the Army’s business environment. These solutions may include system improvements, process re-engineering, and best business and accounting practices. Emergent deficiencies may result in new actions and tasks being identified by the Government that are unknown at this point. However, these emerging deficiencies and resulting corrective actions shall still be considered within the scope of the contract as long as they are associated with the implementation of the Army FIAR program.

The contractor shall assist in tracking, monitoring, and reporting of all notice of findings and recommendations (NFRs) received from the IPA, and relevant financial management findings from the GAO, DoDIG, and Army Audit Agency in accordance with FIAR program and Army processes to ensure closure of the NFRs and CAPs.

The contractor shall provide innovative approaches to maximize return on investment.

4.2.2 Task Area Two: Audit Facilitation / Support

The contractor shall mature and enhance audit infrastructure for efficient and effective audit response and coordination, to include the acceleration of Prepared by Client (PBC) response time and quality improvement of PBC packages to meet IPA requirements. The contractor shall serve as liaison within ASA (FM&C) and between the Budget Submitting Offices (BSOs), Defense Finance and Accounting Service (DFAS), other Stakeholders, the IPA, General Accountability Office (GAO), and Department of Defense Inspector General (DoDIG) for audit response and coordination; to include site visit coordination and facilitating data calls. The contractor shall perform PBC artifact coordination, tracking, and reporting, and provide Key Supporting Document (KSD) maintenance.

Audit liaison support shall include maintenance and execution of audit response infrastructure. The contractor shall support engagement with the IPA throughout the audit lifecycle to proactively prevent findings and identify compensating controls.

4.2.3 Task Area Three: Financial Reporting and Accounting Information

The contractor shall support liaison activities with DFAS and the BSA and assist with the reconciliation and validation of the end-to-end business processes related to Financial

Statement Compilation and Reporting (FSCR) and Funds Balance with Treasury (FBwT).

The contractor shall support the automation and streamlining of Fund Balance with Treasury (FBWT) reconciliations to enable timely variance resolution.

The contractor shall produce monthly statement and financial reports; quarterly financial statements; and the Annual Financial Report (AFR) on time in accordance with the established reporting schedules and Office of Management and Budget (OMB) Circular A-136, Financial Reporting Requirements. The contractor shall support ad-hoc data analytics requests over financial statement information.

The contractor shall assist with the maintenance of the Universe of Transactions (UoT) for Full Financial Statements, addressing the accounting transactions and audit requirements necessary to support the Army GF Financial Statements. This includes assisting Army stakeholders whose assets are subject to Real Property, General and Military Equipment, Government Furnished Property, Inventory and Operating Materials and Supplies (OM&S) reporting, to improve asset accountability, establish monitoring controls to sustain populations, ensure they are able to accurately report financial and logistics data in approved Army system(s), produce transaction universes that support the reconciliation of feeder systems to GL system(s), maintain the data in an audit ready state, and be prepared for audit by independent external auditors. The contractor shall develop and perform these reconciliations and develop monitoring tools for exception resolution.

The contractor shall assist in completing and sustaining valuation beginning balance baselines for each category of assets based on existing strategies and approaches for Real Property, General and Military Equipment, Government Furnished Property, and Inventory and OM&S, until such time as an automated Go Forward compliant process in place. This shall involve supporting the Government in development of processes and procedures to obtain necessary KSD and updating all associated documentation as it relates to beginning balance effort.

4.2.4 Task Area Four: Financial Policy, Standardized Business Processes, and Budgetary Reform

The contractor shall support facilitation and publication of financial management policy (including budget and accounting) to improve the management of Army resources and ensure auditability and adherence to Federal Accounting Standards and Advisory Board (FASAB), Generally Accepted Accounting Principles (GAAP), and other Federal and DoD laws, regulations, and policies, across the Army enterprise. The contractor shall support the development, promulgation and enforcement of financial management standards and policies across the Army, including processes, reports, and records for all Army financial systems. The contractor shall ensure the relevant Army financial policy memoranda and other accounting, and budgetary policy manuals are current and provide support to ensure compliance with such policies by Army stakeholders. The contractor shall support updates to policies to reflect evolving audit and/or compliance requirements.

The contractor shall support Army business environment transformational efforts; define business process improvement initiatives and assist and support in the implementation of these improvements at the Enterprise and BSO level. Examples of business processes under transformation are Civilian and Military Payroll initiatives. The contractor shall ensure documentation of these improved and standardized Army business processes in support of the recording and reporting of financial transactions. The contractor shall support development of systems user guides for BSOs to drive common business execution across the enterprise. The contractor shall support the enforcement of process standardization by leveraging standard Army ERP system controls (e.g., Posting Logic).

The contractor shall support Army’s budgetary reform efforts. For example, the contractor shall support enhancement of end-to-end Funds Receipt and Distribution (FRD) to accurately and completely record General Ledger funds in coordination with all BSOs and the Defense Finance and Accounting Service (DFAS). The contractor shall support the implementation of controls to timely record obligations, receipt, and disbursement, monthly validation and quarterly certification of obligations.

4.2.5 Task Area Five: Internal Controls Institutionalization

The contractor shall advise and assist with oversight and assurance for Army-wide implementation and management of an Internal Control Program required by the Federal Managers’ Financial Integrity Act and OMB Circular A-123. The contractor shall assist in establishing an Enterprise Risk Management (ERM) framework including a Fraud Risk Management program, risk registers for Army financial and strategic risks. The contractor shall support the Army establishing a culture of continuous monitoring to successfully manage operational, financial, and systems risks.

The contractor shall compile the Army-wide Statements of Assurance (SOA). The contractor shall track internal control deficiencies and the measures taken to correct the deficiencies. The contractor shall coordinate with subordinate organizations to ensure that each subordinate organization completes their SOA, which progressively roll up to the Army SOA. The contractor shall drive towards accountability and ownership across the enterprise to inform the SOA.

4.2.6 Task Area Six: Systems Consolidation, Modernization, and Implementation

The contractor shall support the modernization, development, implementation, and consolidation of Army Financial Management (FM) Systems (general ledger [GL] and feeder systems). Efforts focused on simplifying and consolidating the Army’s FM environment aim to increase auditability, reduce operating costs and minimize cyber vulnerabilities.

The contractor shall improve modernization of the Army’s financial and financially relevant systems to enforce auditability requirements. Whenever possible, system solutions should be pursued to optimize business processes and remediate deficiencies.

The contractor shall assist where necessary in facilitation of system change control and support standardized business processes to reduce/eliminate system customizations.

The contractor shall enhance system modernization and integration to provide a complete range of financial and cost information needed for the Army to conduct business transactions, provide accountability to the public, and to support performance reporting and decision making. For example, the contractor shall support, improve, and sustain Army’s Enterprise Resource Planning (ERP) Business Initiatives, including, but not limited to, the GFEBS family of systems (e.g., GFEBS, GFEBS-SA, and GCSS-A (Finance), etc.).

The contractor shall also advance the consolidation and modernization of legacy systems to reduce cybersecurity risks and sustainment costs, while providing an operational, auditable warfighting capability that delivers from strategic support areas to the tactical point of need. For example, the contractor shall enable Enterprise Business System- Convergence (EBS-C) efforts and execute business system transformation support to modernize existing systems (e.g., GFEBS, GFEBS-SA, GCSS-A, LMP, AESIP, etc.), strengthen systemic controls, and implement other new technology to improve business processes.

The contractor shall provide support in achieving and maintaining an audit ready state for information systems identified in the FIAR process. The contractor shall coordinate and collaborate with various portfolio managers and program offices for all information systems identified in the FIAR process that are maintained and/or used by the Army, to provide clarification on Federal Financial Management Improvement Act (FFMIA) requirements and other support as required. The contractor shall support remediation of Information Technology (IT) controls across all financially relevant systems with sustainable solutions.

4.2.7 Task Area Seven: Financial Data Environment

The contractor shall establish financial data strategy and governance. The contractor shall support initiatives to enhance financial analyses and data quality through standard tools, processes, and data driven corrective action plans, improve data integration with the Office of the Secretary of Defense (OSD) using Advana or other systems/software/platforms, and launch digital budget tools and use of analytics to enable fact-based business and resource decisions.

The contractor shall assist the collection, validation, transformation, analysis, and reporting of the Army Financial Data to include full identification of the Universe of Transactions (UOT) and reconcile to financial statements. The contractor shall enhance compliance, completeness, and accuracy of data.

The contractor shall provide innovative approaches (e.g., Robotics Process Automation, Cloud Technology, Artificial Intelligence) to maximize return on investment.

4.2.8 Task Area Eight: Task Order Project Management

The contractor shall provide Program and Project Management, monitoring and analysis, strategy, enterprise architecture and planning support on an enterprise, portfolio, program, and/or individual project level. In most cases, this will require the deployment of Program and Project Management capabilities and expertise to ensure the successful execution and implementation of individual task orders. This support may include, but is not limited to:

• Program and project support

• Finance management and compliance

• Strategic communications

• Change management

• Performance management and contractual reporting

• Knowledge management

• Training

• Information Technology support

Army intends to stand-up a FIAR Project Management Office (PMO) independent of this Multi-Award Contact (MAC) that will interface with, and support the management of, this program and contractors. The contractor shall not interpret 2.2.8 to facilitate the stand-up of a separate PMO. Instead, 2.2.8 contributes to the successful development, implementation, management, and sustainment of this MAC’s tasks within the broader audit remediation program.

4.3 Sustainment

Once the DoDIG has issued an unmodified audit opinion on one or more Army financial statements, it is anticipated that contractor support shall transition to ensure that the unmodified audit opinion is sustainable in subsequent financial statement audit engagements.

5. Task Description and Period of Performance

Specific Task Descriptions and specific Period of Performance will be set forth in the resultant task orders.

6. Deliverables Deliverables will be included at the Task Order level.

7. Performance Standards Performance will be incorporated at the Task Order level.

4.3 Sustainment