IRS modernization program makes strides

IRS modernization program makes strides

The IRS met federal requirements in fiscal 2004 for managing and accounting for its Business Systems Modernization program, according to a Government Accountability Office report released this week. But there is still work to do, the watchdog group said.

The good news is that the IRS made progress in instituting controls the GAO had previously recommended. For example, IRS fulfilled capital planning, investment control review and IT acquisition requirements, GAO said. The agency also successfully deployed several modernized systems, including the initial version of its new taxpayer database, the Customer Account Data Engine, and a modernized e-File system that enables large corporations to electronically file their returns.

However, there are still weaknesses in management controls related to configuration, human capital, cost and schedule estimation, and contract management, the GAO report stated. For example, the total lifecycle cost for full deployment of the initial release of the IRS' new Integrated Financial System increased by $74 million, and project completion was delayed 15 months. The IRS took the initial version of IFS live last week.

The IRS countered that it had improved modernization management controls and capabilities, including cost estimation and scheduling. Since re-baselining cost estimates and delivery schedules for modernization projects late last year, the agency has delivered on time and within budget, except for IFS, said IRS commissioner Mark Everson in a response dated Oct. 28.

'It demonstrates that the steps we took in 2004 to improve program performance are having a positive impact,' Everson said.

The IRS said it has hired seasoned technology executives with a proven track record of managing and delivering large, complex IT projects.

'A little over a year ago, the mix of leadership at the top of the BSM program consisted of one outside expert and six internal IRS executives,' Everson said. 'Today, that mix will soon be five outside experienced experts and three internal IRS executives. This mix is a much better balance of the technology talents and tax administration experience needed to successfully run BSM.'

The IRS will continue to provide GAO with monthly dashboard reports on its progress in maturing its management controls, he said.

The GAO also recommended that the IRS perform reviews on deployed projects that include an analysis of actual-versus-planned benefits to determine whether the project met expectations.

Everson said the IRS has developed new procedures to extend post-implementation reviews, assess the lessons learned at the end of each project milestone and retain the results of these reviews in a repository available to all in the modernization program. The agency will conduct the first review under the new procedures by year-end and within 45 days of passing each subsequent project milestone, he said.

About the Author

Mary Mosquera is a reporter for Federal Computer Week.

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