Page images
PDF
EPUB

Pages xi and 218

Recommendation:

An alternative billing method should be provided for Congressional and other jobs for which work is received over time and for which production requirements cannot be ascertained at the point initial work is accepted. Billing estimate for such work to be incrementally determined, and to be based on production and material standards and schedules of prices/rates applicable for all work.

Response:

The recommendation is unclear but it is assumed that the "alternative billing method" refers to an alternative to firm billing estimates since the recommended method describes our present procedure of accumulating costs in the computer and making frequent billings on jobs for which work is received over a long period of time.

Pages xi and 218

Recommendation

Provision should be made for progress payment billing for those jobs for which completion will normally exceed a three-month period. Also customer billings should be generated from the Work-in-Process ADP system immediately upon completion of the job, to the maximum extent feasible, thereby bypassing the finished work stage.

Response:

In regard to progress billing, GPO presently does some billing in this manner. This is primarily limited to large dollar volume jobs which tie-up substantial sums of working capital since multiple billings increase our workload.

As we told the contractor, the direct billing from the Work-in-Process system was adopted during 1977 for limited types of work, but after a trial period was discontinued as the result of problems such as those described in our response to the recommendation that we firm bill commercially procured jobs.

Pages xi and 218

Recommendation:

The application of the Simplified Intra-Governmental Billing and
Collection (SIBAC) System should be extended to billings for the
Department of Defense services and agencies and for Superintendent
of Documents publications sales to governmental activities.

Response:

The recommendation implies that GPO did not attempt to extend SIBAC to all of its customer agencies and to Department of Defense (DOD) agencies. On the contrary, as we told the contractor, GPO initially attempted to extend SIBAC to all agencies. However, since DOD was exempt from the Department of Treasury SIBAC System, it was therefore exempt from the GPO system. We are still working toward covering all of our customer agencies under the SIBAC System, including DOD.

The recommendation also states that GPO should extend the SIBAC System to Superintendent of Documents publications sold to Government activities. This is another example of the contractor making recommendations based on what we said we were doing, or planning to do, since we informed the contractor, that we are planning to extend SIBAC to the Superintendent of Documents activities.

D. Surcharges

Pages xi and 219

Recommendation:

Surcharges should be reduced to reflect the costs they are designed to recover and other methods utilized to discourage the need for "rush" work.

Response:

We do, in fact, handle surcharges similar to what the contractor recommends elsewhere for our other rates, i.e., establish a standard rate and then hold that rate firm for an extended period of time. Sometimes we slightly over-recover and other times we under-recover costs.

We periodically review the surcharge rates so that appropriate adjustments can be made. These rates are established to recover the costs associated with priority work handled by GPO. Some of the costs associated with this priority processing is readily identifiable, while other costs are not. It would not be practical to design and implement a system that would collect throughout the entire GPO all of the additional costs -- including administrative costs -- applicable to priority work. However, we will continue to review our surcharge rates and adjust them on a more frequent basis than in the past, so as to minimize both over-recovery and underrecovery of these costs.

It should be emphasized that surcharges are not penalties to discourage rush work. They are designed only to recover additional costs. It would be improper for GPO to use surcharges or to utilize other methods to discourage work which is urgently needed.

E. Financial Reporting

Pages xii and 220

Recommendation:

Financial system reporting capabilities should be revised and expanded
to effectively support management decision making and control processes.
This encompasses development of the following types of reports and
reporting capabilities:

Operating reports which reflect operating costs and revenues in comparison with operating budgets, with reporting and analysis of variances for all operating and program managers.

Operating reports which relate actual costs to standards and work measurements used in management systems.

Financial reports which provide information on unit costs.

Data reporting systems capable of producing reports needed for financial analysis, evaluation and management of receivables, inventories, revenues, costs, rates, etc.

Data reporting systems capable of integration with GPO management information and control system( s).

Financial reports for the various segments of GPO which are incomeproducing activities. Such reports to include all elements of revenue and cost, and net operating results for each segment or unit, with consolidations for like type activites such as bookstores, RPPO, etc.

Reporting systems capable of producing reports on a more timely basis.

Response:

The recommendation implies that GPO reporting capabilities do not provide the enumerated data and do not support management decision making and control processes. This is not so. The lead-in to this recommendation states that reports are prepared manually and that improvements are desirable. Elsewhere in the report, the contractor recognizes that the reporting system does support GPO's top managers. The primary point appears to be that the reporting system should be further automated to expand the availability of information on a more timely basis.

Currently, fully coordinated financial briefings are provided to top
managers on a regular monthly basis and to other managers on an as
needed basis. These briefings fully coordinate data contained in Budget,
Productivity, MBO, Financial Operations, and Modernization activities.

Also, as commented on previously, the printing cost investigating techniques and related reporting is providing managerial feedback to operational managers on a day-to-day basis.

F. Accounting Systems

Pages xii and 221

Recommendation:

A fully integrated accounting system should be designed and implemented. Alternatives for improving and updating GPO accounting systems are to:

Continue to make improvements to individual accounting systems and components.

- Design a new accounting system.

Recent system development efforts have been directed toward improving
existing system automated components and processes, and toward auto-
mating manual processes. Continuation of this approach will provide
some improvements in processing and control of accounting operations.
However, such improvements will do relatively little toward making
the system more responsive to users' needs for:

[blocks in formation]

An alternative approach for consideration is to design a new accounting system. This approach gives recognition to the fact that:

- Current systems have only limited capability of meeting the needs

of GPO for management information.

- Modification of existing systems have a ripple effect on interface

systems and will require continued maintenance.

Objectives appropriate for a new accounting system include:

Optimization of the extent to which accounting operations are supported by a computer-based system encompassing data entry direct from source docuinents with on-line transaction data edit/validation; single transaction entry for update of all system files; system generation of related transactions, adjustments and of management notices for followup decisions or actions; interaction or effective interface with other systems; production of automatic payment listings and of checks, etc.

Satisfaction of the financial information needs of GPO for its operating and decision-making functions, through timely reporting and an on-call inquiry capability.

The design of a new fully integrated accounting system is strongly recommended.

Response

The lead-in to the recommendation states that the current system is obsolete by present day automation standards. The recommendation then says that rather than follow the current practice of making improvements to the existing system, the alternative of designing a new system would be the best approach. We do not agree with this recommended alternative.

The current accounting system is a fully integrated accounting system and enables us to provide information to top management on a timely basis. We recognize that the current system has manual routines and needs the benefits of further automation. We have been in the process of automating and improving individual subsystems and components of the overall system. Our approach, as set forth in the Data Automation Plan, has been to constantly make improvements on existing systems while working toward the automation of the entire system. We believe this approach is more appropriate since it will provide, on a comparable time basis, a system that is as fully effective as any alternate system without the inevitable chaos attendant with the design and implementation of a totally new system.

[blocks in formation]

The policy stipulated by GAO Manual for Guidance of Federal Agencies, Title 2--Accounting, should be adopted by GPO for accounting for purchase discounts taken, and discounts lost should be recorded in a separate account to make management aware of this cost. This is considered the preferred accounting treatment for all Federal Government activities.

Response:

The present practice will be revised and discounts will be treated as a reduction of cost. The establishment of a separate account for discounts lost will be considered. However, in light of the Department of Treasury regulations on cash management which state that certain discounts should not be taken, further study will be required before any final resolution of this matter.

Pages xiii and 223

Recommendation:

An alternative approach should be developed for recording purchased printing accruals/payables to reflect actual performance, and to serve as a basis for automatically generating customer billing.

« PreviousContinue »