Illinois Asset Protection News

Integrated Financial Management Systems

Financial management systems must be designed with effective and efficient interrelationships between software, hardware, personnel, procedures, controls, and data contained within the systems.  To be integrated, financial management systems must have (i) standard data classifications (definition and formats) established and used for recording financial events; (ii) common processes used for processing similar kinds of transactions; (iii) internal controls over data entry, transaction processing, and reporting applied consistently; and (iv) a system design that eliminates unnecessary duplication of transaction entry.

The financial management systems policy stated in OMB Circular A-127 Financial Management Systems, requires that each agency establish and maintain a single, integrated financial management system.  Without a single, integrated financial management system to ensure timely and accurate financial data, poor policy decisions are more likely due to inaccurate or untimely information; managers are less likely to be able to report accurately to the President, the Congress, and the public on government operations in a timely manner; scarce resources are more likely to be directed toward the collection of information rather than to delivery of the intended programs; and modifications to financial management systems necessary to keep pace with rapidly changing user requirements cannot be coordinated and managed properly.  The basic requirements for a single, integrated financial management system are outlined in Section 7 of OMB Circular A-127.

Having a single, integrated financial management system does not necessarily mean having only one software application for each agency covering all financial management system needs.  Rather, a single, integrated financial management system is a unified set of financial systems and the financial portions of mixed systems encompassing the software, hardware, personnel, processes (manual and automated), procedures, controls, and data necessary to carry out financial management functions, manage financial operations of the agency, and report on the agencys financial status to central agencies, Congress, and the public.  Unified means that the systems are planned for and managed together, using common data elements, operated in an integrated fashion, and linked together electronically in an efficient and effective manner to provide agencywide financial system support necessary to carry out the agencys mission and support the agencys financial management needs.

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	Did You Know?
	A Living Trust is an entity created for the purpose of holding and managing assets A Living Trust is an entity created for the purpose of holding and managing assets for the benefit of the creators of the Trust (the “Trustors”) during their lifetimes and then for the purpose of management and distribution of the assets to the beneficiaries designated by the Trustors. There are various reasons for creating Living Trusts: (a) To avoid probate administration on death of either Trustor. (b) To avoid a court supervised conservatorship in the event of lifetime disability of either Trustor. (c) To provide for the management and distribution of assets during continued administration of the Trust or upon its termination.