The Government Accountability Office (GAO) is urging the Department of Veterans Affairs (VA) to update requirements in its Financial Management Business Transformation (FMBT) program to improve its cost estimate and schedule.
VA established the FMBT program in 2016 to replace its decades-old financial and acquisition systems with one integrated system to meet the agency’s financial management goals after two previous IT system overhauls failed. According to GAO, VA’s November 2024 life cycle cost estimate for FMBT totaled $8.6 billion – up $942 million from the prior-year estimate.
According to the Feb. 24 GAO report, the watchdog agency recommended back in 2021 that VA make changes to improve the program’s cost estimate and schedule, but the veterans agency not yet done so.
“VA continues to not fully or substantially meet best practices for developing and managing the cost estimate and schedule,” the report reads. “As a result, they are unreliable. Without a reliable cost estimate and schedule, VA management risks not making fully informed and sound decisions,” the report adds.
GAO found that VA only partially implemented three agile best practices for its financial management business transformation program. Falling short on implementation, the agency said, leads to a program without high priority focus, traceability of progress, and could develop functionality that is not immediately necessary.
GAO also found that VA did not sufficiently incorporate an independent review of the program.
“Although the program generally incorporated the elements of an effective independent review, VA does not have department-wide IT acquisition policy that requires independent review or incorporates the key elements,” the report reads.
“As a result, VA risks not consistently implementing independent reviews for other VA IT programs,” the report adds.
GAO made four recommendations to VA to improve its FMBT program, including developing and agile road map and prioritizing work based on relative value. The watchdog also recommends that VA implement an “effective” independent verification and validation framework of acquisition policy, procedures, and guidance. VA concurred with those recommendations.
