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FINANCIAL IMPROVEMENT AND AUDIT READINESS WEBSITE

FIAR Plan

Overview


The Department's methodology for achieving improved financial information and auditability has evolved and has been refined since the FIAR Plan was first issued in 2005. The FIAR Plan priorities were established in August 2009 and require the Components to first focus on improving processes, controls, and systems supporting information most often used to manage the Department. This is the starting point for achieving the goal of obtaining auditable financial statements, beginning with the SBR. To achieve these objectives, the FIAR priorities are:
  • Budgetary information, and
  • Mission critical asset information
The Component Financial Improvement Plans (FIPs), when summarized collectively, compose the Department's FIAR Plan. The DoD Components' FIPs are prepared and executed in accordance with FIAR Guidance issued by the Office of the Under Secretary of Defense (Comptroller) (OUSD(C)). The FIAR Guidance provides the strategy and standard methodology, as well as the step-by-step approach for discovery and evaluation; documenting, testing, and strengthening controls; and achieving an audit ready systems environment. The FIAR Plan Status Report provides a summary overview of the FIAR methodology as well as accomplishments and improvements achieved during the reporting time period.

Through an October 13, 2011, DoD-wide memorandum, Secretary of Defense Leon Panetta directed the Department to accelerate key elements of the FIAR Plan and place greater emphasis on the overall effort. The Secretary's memorandum also directed DoD Components to revise their FIPs to incorporate the accelerated date of 2014 for the SBR. Specifically, the Secretary called for the Department to:

  • Achieve audit readiness of the Statement of Budgetary Resources (SBR) by the end of calendar year (CY) 2014.
  • Increase emphasis on accountability of assets.
  • Execute a full review of the Department's financial controls over the next two years and establish interim goals against which to assess progress.
  • Ensure mandatory training for audit and other key financial efforts, and establish by the end of CY 2012 pilot certification program for financial managers--similar to the one now in place for acquisition managers.
  • Appropriately resource efforts to meet these goals.
  • Meet the legal requirements to achieve full audit readiness for all DoD financial statements by 2017.
Although the Secretary's direction shortened the time for achieving audit readiness of the SBR, the FIAR strategy and methodology remain the same. Achieving these goals will be challenging, but with the Secretary's involvement, which has elevated audit readiness to an "all hands" DoD-wide effort, the Department's ability to achieve these goals has been significantly increased. With the Secretary's leadership, along with the established FIAR priorities, strategy, methodology, FIAR governance (which includes the Department's Chief Management Officers), and increased resources, the Department is positioned to achieve the goal of improved financial information that supports the needs of DoD decision makers.