Finance
to simplify its processes
By
Pte John Wellfare
DEFENCE has launched a major financial project designed to transform
the way it does business and to address the current vicious circle
of audit recommendations.
The new Defence Financial Controls Framework Project has been
established to put in place a system that simplifies financial
processes for all members.
Outgoing CDF General Cosgrove strongly endorsed the project and
said the responsibility for fixing Defence’s finances “rests with
all of us, both military and civilian”.
Project head Mike Gibson said even people who did not work directly
in a finance-related field had the ability to influence Defence’s
financial system.
“There are 95,000 people in Defence and all 95,000 of them are
affected by this framework,” he said.
“A simple example is, everybody has to put their leave form in
and everybody needs to check that their leave records are correct.
If their leave records aren’t correct then Defence’s leave liability
on our balance sheet is incorrect and we are in trouble with the
auditors again.
“The fact is that people out in the field entering data into a
system such as the Standard Defence Supply System are just as
important for the outcome of our financial statements as anybody
here in the Chief Finance Officer Group.”
He said although the project had been formed in response to recent
criticisms in an Australian National Audit Office report, the
aim would be to establish a lasting financial control structure
that would go beyond simply addressing those specific audit issues.
“This project is about putting in place a financial control framework
that we need to do our business well,” he said. “What we’re trying
to do is get a best practice financial management environment
in Defence, because we need it to run our business, not because
the auditor found a problem, although that was the genesis of
the idea for the project.”
Stressing that the project was not just another remediation project,
Defence Secretary Ric Smith said the aim was to have Defence “recognised
by Government as highly competent, professional and business-like
financial managers within the next five years”.
Mr Gibson identified several important key elements of the project
including:
“At
the moment there’s a myriad of policies and processes within the
organisation, but they’re not collocated, they’re not easy to access
and one of the big challenges we’ve got is to make those accessible
to the people,” he said.
“I think the technical framework is one aspect. We’ve then got to
bring the hearts and minds of people to work within that framework
and we’ve got to make it easy for them to get the information that
they need.”
He said as the project unfolded during the next few years, members
would notice some important differences.
Once the framework was in place, members would have a clear understanding
of where to go for services or information on performing financial
tasks, he said.
Members would also benefit from the standardisation of processes
across the organisation.
“When people are posted from one location to another, they’ll be
doing business in a much more common way than they currently do,”
he said.
“The workload associated with getting up to speed on how to do the
work or what to do will be much reduced in the future.”
He said the project’s success hinged on the efforts of all Defence
members to improve the organisation’s financial processes.
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