NOTE: The targets for the audited financial statement goals matches the year covered by the financial statement.

*In FY 2002, the Office of Audit Resolutions and Cost Policy was transferred from the Office of Grants and Acquisition Management to the Office of Finance. This FY 2003 GPRA plan includes the goals, etc. for audit resolution.

Performance Summary

The Office of Finance (OF) provides leadership and guidance on HHS financial management to maintain the confidence of the public that all resources are managed effectively. OF achieves this outcome by ensuring the timely and accurate disbursements and collections and recording of funds and by informing its customers, i.e. decision-makers and the taxpayers with useful financial information.

DM GPRA Performance Plans

OF is committed to achieving two HHS financial management strategic goals: Decision-makers have timely, accurate and useful program and financial information; and all HHS resources are used appropriately and effectively.

ASBTF Finance will accomplish these goals in partnership with the HHS components, with the government-wide Chief Financial Officer's Council through its various committees and work groups and with the central agencies including OMB, Treasury, etc. The Office of Finance will utilize these key results to achieve its long-range performance goals which include development of an integrated process which captures financial, budget and program performance information and which makes financial information more useful for program managers.

Goal 1: Timely Audit Opinion.

Establishing Performance Targets: The due dates for completion of audited financial statements are established by law. HHS, as the equivalent of a corporate entity, is obligated to meet those due dates. The HHS financial statements and the auditor's opinion on those statements, roll up from and rely upon the statements and audit opinions of HHS components. Of the 13 components of HHS, 9 components prepared audited financial statements for the FY 1999 and FY 2000 cycle. They are: ACF, CDC/ATSDR, CMS, FDA, HRSA, IHS, NIH, PSC, and SAMHSA. (Since ATSDR is included in the CDC statements, CDC/ATSDR are counted as one HHS component). AoA will have its first full audit for the FY 2001 statements. AHRQ and OS have financial statements, but they are not audited individually.

The target year applies to the period covered by the statements although the audit of the statements is performed in a subsequent year.

Discussion of FY 2002 and FY 2003 targets: OMB has issued guidance which proposes to accelerate the schedule to require that the statements and report be available at the time of the President's budget submission). The target due dates of February 1, 2003 and 2004 reflect that guidance; they will be adjusted if the guidance changes.

Given the fact that new, updated financial systems will not be fully implemented and the inherent lag in GPRA program performance data for the overviews, this will be a very difficult challenge and will tax available resources. The milestones will apply to CMS, NIH, ACF, CDC, and FDA as well as HHS since these HHS component audited statements are material to the HHS statement. The other HHS component audited statements will also have established milestone dates that will enable the Department to meet the revised OMB deadlines.

Data Source for Performance: Dates of Inspector General's Report for HHS-wide Audit and Independent Auditors Report for HHS components Audits.

Data Verification and Validation: Copies of these reports are provided by the Inspector General and are kept on record.

Performance Progress: HHS, CMS, and FDA audits were timely and ACF, NIH, and HRSA

DM GPRA Performance Plans

were substantially completed on time. The SAMHSA audit was delayed due to implementation issues with the new grant payment system. CDC's audit was delayed by these same issues and also by issues related to reimbursable activities. The PSC audit was delayed as a result of the grant payment management system delay in other OPDIV audits. The IHS financial statement audit for IHS was also delayed, but was completed. None of these delays affected the HHS opinion, however they do reflect the difficulty in maintaining timely, clean opinions. In preparation for its first full audit in FY 2001, AoA had an audit review completed on its Balance

Sheet.

over Previous Year: The goal and measure was revised for FYs 2002 and 2003 to Changes emphasize the fact that HHS is a single organization. This is consistent with the Secretary's direction HHS will continue to track the performance of each individual component internally. Clean Audit Opinion.

Goal 2:

Establishing Performance Targets: The independent auditor's opinion determines whether the statements fairly present the financial condition of an entity while complying with generally accepted accounting principles. If they do, an unqualified or "clean" opinion is rendered. If not, either a qualified opinion (one or more serious findings of deviations from accounting principles) or a disclaimer (not auditable) is given.

The same basis for quantifying the Performance Goal 1 above, applies to Goal 2.

Discussion of FY 2002 and FY 2003 Targets: Due to the accelerated schedule and related

challenges discussed under Goal 1 above, the HHS clean opinion will be difficult to maintain. It is dependent on human resource skills and financial systems.

Data Source: Financial Statement Auditors Opinion and Date of the Opinion.

Data Verification and Validation: Copies of these reports are provided by the Inspector General and are kept on record.

Performance Progress: HHS has continued to improve the reliability of the financial statements. None of the statements prepared for the FY 1997 period were unqualified, but two HHS components received unqualified opinions for FY 1998 and HHS received its first clean opinion for FY 1999. A second clean opinion was earned for FY 2000. Eight of the 9 HHS components' statements that support this goal, also received a clean opinion. The ninth component (IHS) did not receive a clean opinion.

Changes over Previous Year: The goal and measure were revised for FYs 2002 and 2003 to emphasize the fact that HHS is a single organization. This is consistent with the Secretary's direction. HHS will continue to track the performance of each individual component internally.