DHS faces new financial management rules

In the wake of disagreements over financial management at the Homeland Security Department, President Bush signed legislation Saturday requiring the department's chief financial officer to be confirmed by the Senate within 180 days, and an independent auditor to issue an opinion on DHS' internal accounting controls starting in fiscal 2006.

The Homeland Security Financial Accountability Act (H.R. 4259), spearheaded by Rep. Todd Platts, R-Pa., faced resistance from department officials and the Bush administration. DHS Chief Financial Officer Andrew Maner and his predecessor, Bruce Carnes, called the legislation unnecessary.

"I would have liked to see this off in the future a little more," Maner said Tuesday, noting that these additional requirements are coming just a year-and-a-half after the start of the department. "Financial management evolves over time, and we're getting better every year."

Platts and his colleagues argued in favor of focusing on internal controls, which reduce the chances of financial accounting errors and fraud. Unlike traditional audits, internal control audits focus not on the financial statements but on the checks and balances in place to ensure that the financial statements are accurate and fair.

"Too often, internal controls are a last thought when programs are created; we need to think of them much earlier," Platts said in a news release.

The act also requires President Bush to appoint a Senate-confirmed chief financial officer to the agency within 180 days. DHS remains the only Cabinet-level department without a Senate-confirmed CFO.

"We want to make sure they're complying with every possible law and have every tool at their disposal. The last thing we want is to get too far down the road with bad practices ingrained," said Mike Hettinger, staff director of the House Government Reform Subcommittee on Government Efficiency and Financial Management, which is headed by Platts.

But Maner said that Senate confirmation can cause delays in putting a chief financial officer in place, and "it behooves every agency to have a CFO in the chair at all times."