good morning and welcome to the subcommittee on oversight investigations and this is a hearing on billions spent on miscellaneous expenditures in title also you're not a good controls the v a this is july thirty first this hearing will come to order we're here today to examine an issue of great importance the department of veterans affairs of the second largest in the federal government is authorized to spend billions of dollars of taxpayers money every year to care for those who bravely step forward to the friend on the we have an obligation to ensure that the v a uses these funds appropriately and they are not lost through waste fraud or abuse we must also be sure that they use adequate internal financial controls in management unfortunately the v a does not have adequate internal controls were is this problem is not new yearly have found material weaknesses in v a s financial management systems functionality and in financial management oversight we will hear from attorney we'll hear from general accountability office that the v a procured billions of dollars of goods and services by ways of quote miscellaneous obligations that should not have been part of your this way improper use of miscellaneous obligations obscures how taxpayers money is being spent in addition goods and services that should have been work your competitor really gave the sub subverted using this process use uncertain descriptions like quote third quarter invoice unquote which would not adequately describe its purpose to an unbiased audit review also disclosed serious failures at a bedrock principle of financial management the segregation of duties it was elementary that the person authorized to sign the checks cannot be the same person that approves the expense in thirty out of forty two transactions the g a o looked at the eight fail to ensure the proper segregation of duties just a few years ago three hundred fifty million dollars on a failed attempt to create a modern electronic financial system embarked on redoing the project but even if successful it may be many years away from completion we cannot wait even with the imperfect financial system that has must ensure compliance with basic principles of financial control we look forward to hearing today from hearing from the about how it's do you solemnly swear to tell the truth the whole truth and nothing but the truth thank you next i ask unanimous consent that the honorable robert assistant secretary for management of the department of veterans affairs may effort here i think is something that american people like to see more of across all the committees and in washington d c and so i want to commend you for that with working with her on that let me just say that i have to apologize to the witnesses that i read this report and i look at the category of miscellaneous obligations i hate to say it was guess we're all products of our experience and all the ones i go back  hundred seventy eight when i was a twenty seven year old mayor the auditor came in and told me that there was no checks and balances on miscellaneous expenditures and i had to follow up that with a local district attorney now i don't think anybody is today saying that there is criminal activity going on just because there seems to be some real problems with the accounting process here but when it comes to accounting process doesn't matter reporting does matter especially when we're talking about the n s a expenditures of the taxpayers hard earned money that we have forced from them to send to washington and we have no  er right we have a responsibility to make sure those funds are used appropriately and within the law and frankly i am really concerned this is probably one of the oldest issues in accounting   for anyone who's an accounting of think in the potential for abuse is huge when there isn't an appropriate accounting process so mr chairman i like to introduce into the record my opening statement  paraphrased but let me just say personally i'm very honored to serve with you and to fill in for the ranking member and hopefully working together the american people be served by your bipartisan leadership thank you thank you  expended in the best interest of our veterans out there so i look forward to this testimony thank you very much thank you i ask unanimous consent that all members of the dais to submit a statement for the record actions ordered thank you so much and i appreciate the opportunity chairman mitchell congressman bilbray congressman congressman rodriguez for the opportunity to discuss the veterans health administration and use of miscellaneous obligations t use of miscellaneous obligations now on the first topic rather recorded over six point nine billion in miscellaneous obligations during fiscal year two thousand and seven these miscellaneous obligations were used for a variety of mission related goods and services things such as fee based medical services drugs medicines transportation of veterans to and from medical centers mental just ical support and supplies in the second topic the results of our audit work over the fiscal year two thousand and seven miscellaneous obligations guidance found that v a policies and procedures did not provide adequate controls over the use of these transactions and without effectively designed controls using miscellaneous obligations exposed to increased risk of fraud waste and abuse specifically although the existing policies required contracting officials to review miscellaneous obligations there was no guidance as to how such a review should be carried out and documented with regard to segregation of duties the policies and procedures for miscellaneous obligations did not prevent one individual from being able to perform multiple tasks in authorizing and executing the obligation finally regarding documentation their guidance did not require the key pieces of information being clued in on the authorization form now collectively these systemic control design flaws and they were identified in the case studies that we conducted at three different locations as shown in the table here and i believe you have a copy available to you there was a lack of documented oversight by contracting officials in all of the forty two case studies that we examined we also found inadequate segregation of duties in thirty of the forty two cases supporting documentation was not complete in many of the cases all for example it was lacking crucial descriptive information that was not included in the purpose field in many cases the vendor name and contract number also not provided has recently issued new guidance on the use of miscellaneous obligations that does offer some improvement but it did not fully address the specific control design flaws that we identified and without basic controls over the billions of dollars that spending in this alania obligations significant risk of fraud waste and abuse effectively designed internal controls act as the first line of defense for preventing in detecting fraud and help to ensure that an agency meets its missions and goals complies with laws and regulations and provides reliable financial information on programs and operations to help improve the design of its controls we will be issuing a related report in this area with specific recommendations for a number of actions it could take to implement effective controls in these areas so with that chairman mitchell congressman bilbray congressman space and congressman rodriguez complete my prepared statement but i would like to thank you for holding this hearing today because it helps shine a light on the internal the v a september twenty ninth two thousand and six policy required review of miscellaneous obligations by contracting officials to help ensure their proper use v a supporting procedures did not detail  to be carried out the question is what recommendation do you have that could improve controls in this area  our draft report contains a recommendation that employment policies and procedures to improve contracting oversight over this area and i think this is very important because i think contracting officials  that the contracts will be in accordance with laws and regulations important laws that have been passed to help ensure competition in the contracting process and that is economy and the federal acquisition regulations are of the miscellaneous obligation automated and associated policies were not designed to prevent a single official from performing multiple roles in the process of authorizing and executing miscellaneous obligations what's the risk of fraud waste and abuse in the v a by one person performing multiple roles in approving obligating funds do unnecessary risk on that transaction that funds could be subverted for purposes other than that really intended by the congress and that the taxpayers were hoping when they sent their funds to washington i think it's important that the continue to do develop processes that will address this issue in particular we saw that control point officials which are the key officials out in the v a medical centers that are doing  the transactions typically have the authority to request to approve that transaction and also certify payment in the end and one last question before my time is more than is needed necessary and i think as you know these systems have grown up over time but it's important that v a is now recognizing that things need to change you know those taxpayer dollars are at risk true that without the center gated duties there are no checks and balances in reality one person can make the call and either do a great job or do a terrible job well congressman bilbray i agree that it certainly increases the risk that an unscrupulous employee you know could use the funds for purposes other than that intended and in fact historically i think that this kind of  person control has shown that it doesn't happen overnight it happens to be something that's slipped into a little bit doesn't make any difference no one's there to call him down on a little mistake or a little transgression and slowly but surely the problem bills and grows until it becomes a horrendous problem my question is do you have any idea how long this structure is existed well i cannot give you a definitive answer on that individuals may make mistakes but we should make sure that the system minimizes that potential out of forty two reviews thirty of them only twelve of them had what you felt was segregated oversight that's a pretty substantial number when you get down there and i'd have to say that even with my less than stellar academic achievement of the past that is not a passing grade for date we started our work in approximately november of two thousand and seven and are continuing to wrap it up now our draft report is over at v a for comment and we hope to have it fully issued in september of this year what was the therefore you know the chairman and ranking minority member asked that that g a o conducted a study into this area right and one was a last audit conducted by the g a o it's miscellaneous expenditure  system congressman i'm not sure that it has ever been done before to tell you the truth i'm not aware of any prior studies in this area ok and one one where your reports are findings delivered to the v provided a copy of our report the july fifteenth july fifteenth i believe ok and your audit was confined to the v a not the entire veterans administration other departments is that correct that is correct  do you have any kind of estimation or ideas to the nature of whether these miscellaneous expenditures auditing deficiencies exist in other departments within the v well congressman i'm sorry but i can't speak to that simply because our review focused just on what was happening at the i understand from your testimony from report we go from here in your recommendations on what the subcommittee can do to ensure that those deficiencies are corrected in a timely fashion well as always the congress provides an important oversight  ensure that agencies do what they promise they're going to do and we stand ready to help you in that endeavor in any way you would like and is there a follow up on a schedule tend to look at this again in six months nine months a year  sure we stay on top of it knowing full well that there's a large number of resources going and that they need to move quickly on some of those items i also know that sometimes really  it's one thing to issue a policy it's something else entirely to make sure it's implemented so a good first step will be to ensure that those things are being covered internally secondly i think the oversight on by the congress is an important tool do have a hotline where anyone can call in and and give us tips on issues just like you talked about i think the inspector general of v a also has a similar hotline where people can call in with employees and have you had access to those we have not accessed those ourselves as part of this study and what does it take for you to have to get access to that i think it would just be a matter of making certain inquiry to the people who do have times there might be a way of getting good handle on the what you know what kind of timetable are we talking about that you know you are allowing the system to have in order to come back and try to correct  that's a difficult question to answer sir because it's going to vary depending upon the circumstances i think the policy guidance is something that could be done much more quickly than making sure that it's fully implemented throughout which is the critical step you know you can issue guidance but having is the challenging part what kind of report should we ask for from you that would allow us to get a better grip on this issue so that we can make sure money was going but nobody was checking so there was no way for another party to know what was going on because the system wasn't there now still isn't it true though that when we go to set again the the services it's not enough to just go to two people checking out that you can you really want to go to three square to check and that the security of three is mega times over what a two person check off point is that one of those things that we should be aiming for an appropriate system well congressman bilbray i think you made important point there of course the gold standard in a four step process that we have here would be all four steps being  segregated but there are certainly mitigating controls that you can put in place to make sure that things are being done you know to the standards that really provide the safety for these funds that are needed what you know then of getting back to exactly what mr rodriguez  do now and what can this administration do and this committee do working with the ministration to make sure that in january we start we have a system that is accountable to the taxpayer well i think continuing to provide oversight in this area is an exceptionally important point it often takes a series of steps in order to ensure that steps are taken by agencies to move them forward i am very impressed that they are planning to do some monitoring activities over this internally but within the body here in the congress continuing to provide oversight continuing to ask them to move forward continuing to provide accountability from these officials will be a critical step to what we need to have a minimum standard they modified to be able to procedure that is appropriate in a modern day accounting not one hundred forty miles thank you very much thank you thank you recognize mr murray for up to five minutes mr chairman and members of sub of this subcommittee good morning thank you for the opportunity to discuss the draft government accountability office report titled veterans health administration improvements needed in design of control over miscellaneous obligations i am edward murray deputy assistant secretary for finance i also serve as deputy chief financial officer i am here administration mr pawle current financial officers veteran veterans health administration mr jan fry deputy assistant secretary for acquisitions and logistics and be a senior and miss philip andersen assistant general counsel i have mr hankies written statement which i would like to submit for the record i appreciate the opportunity to discuss the draft g a o report although in the draft report found that  policies and procedures were not adequately designed it is important to note the g a o identified no incidences of waste fraud or buz our leadership is committed to improving the guidance oversight and business processes associated with the use of miscellaneous obligations and the delivery of service to our nation's veterans this week your staff met with me and be a staff to observe the steps to be a is taken to reduce any vulnerability be agrees with all four g a o those recommendations and we are prepared to discuss the various initiatives planned or underway to reduce the use of miscellaneous obligations and associated internal control risks we are issuing additional departmental policy and guidance that will improve accountability of the miscellaneous obligations process we have reports that enable us to track the improvements interim guidance was issued in january two thousand and eight and was further refined two thousand and eight by the veterans health administration because the veterans health administration is the predominant user of this method of financial obligation the office of general counsel has reviewed the interim guidance and has determined that the new guidelines coupled with existing v a accounting policy meet legal recording requirements new requirements for miscellaneous obligations will be routed for review by the appropriate contracting official and  will be documented and included in the record of for the obligation this interim process will be used until a system change can be made to accomplish this electronically and the integrated funds distribution control point activity accounting and procurement system referred to as if kept in addition we are developing requirements for a patch to if kept mandating population of the purpose vendor and contract number fields until this patch is installed data must be entered manually miscellaneous obligation forms are used for both procurement and non park your main expenditure since if the miscellaneous obligation is for goods or services not required to follow formal particular meant procedures which are not prepare him and items such as fee basis medical or dental services authorizations for individual patients are tracked in the fee basis software system this process includes the appropriate approval requirements by the requesting service approving officials to ensure appropriate segregation of duties a physical office employee approves payment of invoices receipt of medical or dental services as documented by interest industry standard billing abstract document or clinical information from the non be a provider if the miscellaneous obligation is for the procurement is for what is for one of the items approved to be documented by use of the miscellaneous obligation such as nursing homes separate software programs in the veterans health information systems technology architecture track individual expenditures and show the appropriate approval by the requesting service approving official and physical office employees the contracting officer technical representative verifies that goods and services were received for the individual contracts contracting officers perform all pertinent to is related to award of the contract to ensure that policies and procedures are being implemented and monitored b h a now tracks and trends the number and dollar amount of funds obligated use and using miscellaneous obligations in the budget in the by budget object code every month this process enables the ha to determine whether its facilities are adhering to v a and b h a policy in addition v a established the office of business oversight in two thousand floor to realign and consolidate existing where you organizations and functions and to have oversight and compliance response abilities at the departmental level oh blow will review miscellaneous obligations doing their field reviews with special emphasis on adherence to control policies and procedures b a s taking meaningful steps to resolve the current challenge concert challenges concerning the use of miscellaneous obligations be a remains committed to improving its processes and we are confident that our challenges can be overcome for the benefit of the veterans we serve as well as the taxpayers at the end of the day this is not about systems it is about veterans this this concludes my stay there mr chairman i'll be happy to answer any questions that you or the other members of the subcommittee may have with you thank you let me just give you a little story about my background i was a high school teacher and at the same time i served as  mayor of our city and i always found interesting early in the morning as a teacher ever going to the teachers lounge and go through the mailbox and find a statement coming from the superintendent that i was a classroom teacher or from the school board and i'd say you know if the superintendent the superintendent of the school would ever come down here and be in the classroom they would make these kinds of statements and then in the afternoon the mayor's office and i thought i really had a handle on things and i would say and i'm sure there are many people in the city so you know if the mayor would ever get out of his third floor office or come down here he would make those kinds of statements what i'm asking you if you can put in you can make all the statements you want here and you can put in all the reforms you want but the question is how do you know that these are going to be implemented we're really counts the people on the ground for the people that were in these four particular station pittsburgh kansas city this was just three of where the g a o went into how are you going to know it is not going to be dismissed by the people so well here comes another directive from washington let's just doing what we've always done they'll never come down how do we know that what you're what we're asking you to do is going to be implemented well that's what we're going to do starting with fiscal year two thousand and nine the office of business oversight which works directly for the chief financial officer they're going to review seventy seventy to eighty stations they're going to go out and visit these field facilities and they're going to put a special review emphasis in this particular area to see that we do have segregation of duties and that these miscellaneous obligation transactions are being handled appropriately so that that is going to happen here at beginning of the fiscal year immediately you know i looked at the resumes of all you that are here backup for your support and you've all had many not find these and others these are what would be recommended are standard financial procedures checks and balances and from what i understand every year dilute would come in and they would give a an audit and every year they showed some weaknesses in your accounting and nothing's been done with all your expenses did these kinds of things happen to departments you were in didn't flag something to you that we should be doing something different than what's been going on believe that we are doing some things differently in fact grant thornton also in july two thousand and seven noted some segregation of duty and other deficiencies with the use of thirteen miscellaneous obligation documents one of the things we have done is strengthen our policy in the process of issuing departmental level policy that require evidence of contracting review one of the areas i am working with the cia on is that we need to make changes and the system i referred to a cap we have to make changes in that system such that the system enforces the control that the contracting officer does in fact review every thirteen fifty eight a miscellaneous obligation document and we'll work closely with our chief information officer to prioritize changes to the to the cap system to ensure that there is a contracting officer review i assume that all the agencies you work for all of you and the years of service this is the first time this type of things ever happened i just can't believe that i think that with your experience you should somebody should have found this out before the g a o report one of the things that is good and you mentioned is that there was no fraud waste or abuse that has occurred but that's not because of the system and we don't know if we checked all of them and it was a credit to those who were working there but the important thing is mr gove said this opens up the opportunity for that and it didn't take much if you just read what happened recently in the d c municipal government with the people who and that's why whistleblowers don't work all of the stuff that was going on  in that particular situation this can happen and what we're doing is when this if there is fraud abuse or waste deliberate or not as you've said this short changes the services that we ought to be giving to the people where this agency is designed to serve that's the bad part thank that that beautiful home you bought that was built in the one nine hundred forty s that looks so great when you walked in has a foundation that has major problems and solving all approaches so the fact that this is a common problem we're not here to point fingers at any individual but we are willing to say this is a problem that predates all of us technically but now the problem seems to be or the lack of a definitive approach to solving the problem of how we're going to go through and restructure the foundation of the v a so that it has a strong a sound fiscal structure with some kind of accountable process mr m you're saying that you're relieved that there was no fraud detected do you think forty two reviews out of one hundred thirty one thousand expenditures but i would say probably not but i think we just got to say let's not say nothing's been found because in reality you scratch the surface and found enough evidence to say wow you know they potential for it's so huge so let's not even talk about how nothing happened let's assume just by the nature of the system that there are so much happen and was raised in two thousand and three in two thousand and four as a concern now we'd like to raise it up to a major concern if not a fiscal crisis of confidence that we need to address  so much of the reporting are left blank or not describing exactly what the expenditure was for i mean the reporting process looks like it has got you review something and you get how much money was spent but there's a whole sections in here that doesn't people didn't bother to say why it was done for what reason and what the justification down to how just occasion if even they the auditor's are pointing out that the reporting sheets aren't being filled out well i would agree with you if the forms aren't filled up properly it makes it very difficult to review it on the face of the form mr murray might my question is there are appropriate accounting procedures and systems that the twenty first world has accepted for a long time this is not rocket scientists this is something that is just like a minimum standard for anybody that handles any funds little on public funds are you going to have those processes on line and ready to go so that we can sort of repair the foundation this year so that three years from now five years from now we're not back here doing what we're doing the day after being warned about this back in zero three and zero four are we going to have multi review are we going to have at least three people review being able to review any expenditure so that there are some accountability and here are we going to have that online ready for the next fiscal year i will work with the veterans health administration staff to ensure we segregate those duties they have and i hope we will give mr downs a opportunities to talk about some of the what he has involved going in terms of oversight and what he's proposing to do to ensure that the purpose of contract fields are filled in as well as we were go have to either is unfortunate that the system this is cap system is very archaic and actually review this the separations of duty you have to basically touch that field facility or that medical center  you don't get to work with the modern tools that industry has you know we have a lot of confidence mister that if we can get a flight going that we will have workflow separation of duties all that good stuff audit tools embedded in our next generation financial management system to a great degree were hamstrung with the environment we have in terms of  i find myself agreeing with i think the implication just registered by my colleague mr bilbray that one would have to be a fool to think that a system so full of potential for abuse has not in fact been abused and that fraud waste or abuse has not occurred but i also think that the sampling is sufficiently large to make clear that the systemic problems are of a profound nature and while i still find it somewhat difficult to believe that this situation has never been examined looked at or perhaps even  considered up until the last couple years i'm curious and perhaps you know this maybe don't upwards of six million dollars no seven fell through this miscellaneous expenditure provision  do you have any knowledge of what that number would have looked like say four years ago what is your official title deputy assistant secretary for finance and deputy c f o and how would you define in no more than two or three sentences your job description of prior to the g a o audit prior to the hearings with the subcommittee held had it ever crossed your mind that there may be a problem with spending upwards of six billion dollars a year in miscellaneous expenditures that lacked basic and fundamental accounting principles to the extent that the separations of duties are here to to the extent that items it's a service order and the face of it what it becomes in the official accounting system as a service order so if the separation of duties are in place the formal contract and procedures were appropriate has been  it would be ok to spend billions of dollars at all those things were being done they weren't they were very well as as we discovered through grants for and review under a one twenty three and through the  here recently draft or reviewing we're finding that there are serious deficiencies in our control structure of our for how long have you been working in your current capacity about facially six years and so in the first four years you had no indication that these basic and fundamental guidelines were not being adhered to we were working a number of issues and doing there are a number of control issues throughout the v a that are being tackled so this is come more to the forefront in the last few years and mr i'm not doing this point fingers i'm not interested in that i'm not trying to intentionally embarrass anybody but if we've got a systemic problem that allows something so blatant and so obvious to go ignored for so many years with such huge potential for waste and fraud then i think we have an obligation to address it and i'm trying to figure out what's wrong with our system where someone in your position and i know my time is growing short you understand that the g a o thinks that you need to do much more in terms of segregation and oversight and what you've done in terms of your interim  findings or action are you committed to doing those additional taking those additional steps that the report cites absolutely absolutely thank you you have this occurring what can we do to help bob or how can the g a o help you make that happen in a quicker way to expedite because i know that you are let me ask you first of all are you a political appointee make it happen because i know you've got a bureaucracy there that it's hard to deal with also how can you go into all those systems and make something happen as quickly as possible continued emphasis resolution of this problem as my experience in the v a has gotten things done so i would encourage jail's assistance being with them periodically discussing progress as well as with our inspector general i continue to do so with grant thornton in our office of business oversight i think you know what gets measured gets done so that's where emphasis i think will will get this done do you feel you may need in addition to the g a o any other external group come in and i know you have the auditors i guess come in and they can also be extremely helpful in making some additional recommendations and what kind of timetable do you think is appropriate in moving forward in trying to make things happen i would like to see within a year next year the office of business oversight when they do their reviews starting in zero nine from the beginning of the zero nine to the end of zero nine when they go through seven hundred eighty site visits i would like to see that improvement first off and the separation of duties and the appropriate use of miscellaneous obligations as well as i'd like to see those contracting reviews where applicable don so i'd like to see those g a o statistics i would use them as a baseline for those three sites change dramatically by the end f y o nine and the fourth quarter i like to see that  be a small number maybe one maybe two and i would gather that a lot of the institutions up there might be operating i know the chairman mentioned mention this as a school district with all the local campuses that they might be standalone situations that are very difficult to change you have any suggestions as to how to deal with that well institutionalizing good behavior is a challenge we recently did the veterans the v a c f o office supply all resources bear the departmental resources as well as the v a resources to institutionalize change do you have the board and you have the power to be able to go into those other institutions and tell them what they need to do i believe i do i believe i do and i have and i want to be up front here i've never had or the mr down logistics c l o chief logistics the liabilities for example the mitigate i'm not an attorney but the lawsuits you know when people have failed that they've been done wrong in contracting and who keeps a record of that we're not talking about the medical m keeps records of that unless we had still the general counsel would have to to get back to you on on the judgment finding i would like to know the liability of all of this in terms of if there's been problems or  you know abuse some people have been going to certain contractors and then the only other one that would be complain the ones who didn't get the contract and you might have a lot of lawsuits that that's created a lot of billeted for the institution so i would ask that you get to the administration here i mean to the committee here any any of the number of lawsuits a number of complaints and those kind of things and and any kind of whistle blowing that you had that would appreciate in any other items that you think might be helpful and that would also be helpful for you to also id some areas that are more problematic than others that you need to zero in on as quickly as possible thank you very much thank  you mr chairman and thank you mr murray and the rest of you for being here today i would echo a little bit of what my friend from texas first of all i do want to thank you serving serving this country and serving our veterans and there was a very important question that he asked you  career in this year working in the largest health care system in the world and we're cognizant of that our job is to be here to help provide whatever we can to make your job as successful as possible because that translates into care of our best friends that protecting of the public trust in the v a system is one of the highest priorities i see in my job here and so maybe it's like the chairman i'm also a high school teacher we can always find the silver lining anywhere i can tell you that to survive you must  and there's a lot of good and i think that there are some things happened here that i think should give us reason to be optimistic but i think each of my colleagues brought up very legitimate concerns which you've acknowledged in the g a o has done a fine job of doing what they're supposed to my first a positive i guess the process seemed to have worked back in two thousand and seven in boston and identified what was going on i have been as this committee i think has been a strong proponent of making sure that there is a partner make sure they're well funded make sure they have the ability to do what they're supposed to do and i would applaud the chairman and ranking member brown wait also bringing this up i guess my concern is and it's maybe it's a little esoteric and i went to where mr rodriguez was speaking about one of the areas i've spent a lot of time on and my my doctoral work was in organizational design and so i appreciate the challenge but i also know there's things that we can do to make this work i'm trying to get at that boston report came out in june of two thousand and seven and here we said on july thirty first of two thousand and eight talking about what we're going to do my concern has always been with the v a that we provide you not only the necessary oversight but we provide you the necessary flexibility and tools to be able to do your job with several basic i guess mission statement for you urgency were higher it does appear like the g a o offered nothing more than basic best practices you've agreed to that and i think as you said let's hope that it wasn't it didn't get in to watch waste fraud abuse what are we going to do  is specifically going to be done and i guess the question was maybe answered already how quickly you think this will take over i understand cultural change inside an organization is much longer than structural or you know these directives but mr downs if you could tell us for just a minute or so what just some basics of what's going to change whether short term turn goal and of course a long term goal or fourth term is working with our with our antiquated data systems to do workarounds and such to start to pull the reports out so electronically we can begin to review what is going across on across the field in fact the thirty days was discovered by my office when we first became an office and hundred fifty four medical centers and none of them were we couldn't pull data up at a national level very well so we had a lot of data people in my office working on that now they're pulling the ports and when we discovered thirty fifty eight brought it to the attention of appropriate folks and then of course things roll downhill from there because we want to find out what the problems are and we need to solve it and going back to mr murray a while ago and he was being questioned you know part of the fact is that as you are in fact more so because we have an obligation to make this thing work and it's appalling when we come in and we're not able to provide using answer you want nor are we able to properly conduct our oversight monitoring of we don't have the tools in front of us to do it and man your reports just don't cut it you have to have the ability to electronically pull data in so that you can then do the reviews now so what we're doing here with our with our first data runs is we do the method of processing report which closed so one thing that we can do with that is are they leaving these open or they closing them like this should be what is going on there and we're looking at the budget object codes to see what is going on with that expendable him until reports are g i p how's that tie in the p d f matching import of something new that we've just been able to put together which would show the contracts that we have and other to being reported properly and f p d s see all of these things are integrated it can't be just taken one other time and we have a number of other issues that we're going through looking at our item file and our vendor file they're all confused and so trying to pull that together and also help put it in perspective is that is  came into being many years ago it was supposed to solve these problems because we knew some of these things existed our predecessors did and but of course it all fell apart in the interim though we've had to leave come new on the scene and we see the problems and now we're trying to do these work around to get them going again and so we now as of today as a matter of fact there's an r f p out on the street for the integration of the two t v gas it management system which we hope to begin a pilot in january and answer the question has been asked about time this particular part of flight if for the pilot will take place we hope starting in january will take place about a year and then we will do about ten more stations in the next year roll that out and in the third year begin rolling out nationwide so in the long term we're looking at a three year project of all goes well in the short term we're going to continue working with these issues as we develop work arounds with the data systems that we have and we're looking at that information and then more importantly we're sharing it back with the field as a field been doing this for years no one's give them feedback so i think in many cases the didn't know they were doing it wrong just sort of drifted into it as personnel  such my time is almost down to this idea as you and i asked the chairman the ranking member how many hearings we had that we come back around to the issue whether it's electronic medical record and now we're hearing it here this is an issue that their members been on this committee for ten fifteen years and they keep coming around to the idea my belief is if that's where this is all stemming from boy we have got to figure out i am a i'm a big fan of mr hank you i think brought a new vision to this on the side of things but i still keep hearing about it still frustrating so i thank you for what you've done on that end and of course mr downs i thank you any time you're wearing it we welcome you at this committee thank you thank you thank you very much you know one thing this kind of been hinted at from everybody up here and i appreciate what you're going to do this is the second largest department the federal government which is obviously huge and you mention it's pretty hard to institutionalize good behavior and change and and i appreciate all your efforts doing that what i want to ask you very quickly is what do you need from congress do you need resources you need legal authority  need anything from us to help fix the problems that have come up magic want to help but in a way it's it's a difficult question to answer but this continued oversight problems and it's just it's a humongous organization and it takes time to sort through it and the focus by the committees is helpful to us when we quest goes up for resources or support vantage point to support a flight or modernization of our core counting system which would replace the cap is just paramount i mean i don't have the tools that industry has because i'm running kind of a band aid set of applications that are very very old and hard to do the work without some of the tools that many others enjoy and i would appreciate your support of our tool building initiative named flight  thank you well are going to sure you there will be continued oversight but also i think everybody in this committee and in the larger committee wants to provide the resources legal it whatever you need attention on our organizational ministry which is what we're here about for years we achieve success and honor with a high quality of health care now we need to maintain that with the infrastructure that takes it to support it and here we don't know about the behavior we haven't done enough of the research we haven't done a deep enough dive here to find out about behavior we're talking process procedure out mr murray is there any reason at all why from your lofty position in the in the department that you cannot immediately send out a directive that you will not have any miscellaneous expenditures and less we get three signatures on a document that justifies it because let me just tell you guys i've sat in front of you know department heads and staffers since i was twenty five years old what i hear you say about this oversight process is congressman keep having meetings keep talking we love you know we can do this back and forth back and forth just my problem is i don't want that you know this this is a great game of of intellectual tennis or playing here but does it get the job done and by nine hundred forty to here that oversight into talking about it doesn't get done there needs to be some threshold there should be some minimum standards in the private sector you set a minimum standards someone other than fic to fix it down you know exactly what happened the fact is here mr murray is really suits and your because your the guy at the top of this financial review process there should be some minimum standard saying i don't care if you can't do it on a computer take a piece of paper and write it down but i want to see those three signatures i want to have three people that are willing to put their head and their reputation on the line when miscellaneous is on that that should be a big red flag that somebody has an extraordinary reason not to play by the rules which i understand we don't want to have roadblocks but we certainly want to have some accountability and i still don't see mr murray why we can't put a dot time certain that any miscellaneous on and in the old nine budget have to have three signatures and here are the ones i am requiring and i don't want to hear excuses about is there any reason why you can't do that no no our policy separation of duties strong controls was a miscellaneous documentary twenty two thirty seven purchase or document any kind of financial obligation need strong controls kind of accounting one hundred one however  rather than talking about your system i think of shot across the bow could be the fact that we're going to the audit we're going to go do we're going to start doing a deep dive one of our mess with forty two we're going to be talking about no forty two thousand  that's where we've got to go because the system has such a potential for abuse to scare the hell out of people to understand that don't be tempted because the oversight committee is already looking at this i serve as ranking member on procurement for for government oversight this is right up my alley and i'm sure that the subcommittee chairman love to look at this because we should be looking making sure that this situation doesn't happen anywhere in the federal system so i'm saying this very firmly because i don't want to hear about anything coming out of there like boston anymore i think we need to send a signal to the entire process that even if you've been doing this in the past you better keep your nose clean because we're doing the deep dive and going to come looking for you thank you very much i appreciate mr murray any comment you want to make on that you're obviously that we are going to begin doing the deep dive on around the three of us you have the folks here at the table and we're going to begin using our audit resources to to do that deep dive internally and we hope to be able to say that we made great improvement in the future but again i would like to thank all of you for the work that you're doing and as i said you can expect a follow up  this we and i appreciate your trying to do the tools that you need in the financial system we've been told over and over hopefully that's coming to an end that you the systems that you need so that you can do the job that's expected to you which is we've said before is expected in the private sector they would do it immediately and they have those resources we hope  that you get those resources and i hope anything that we can do to help expedite that let us know we want to give you a warning the head of time we want to revisit this early in the next congress  with another countability because i think they want to you but also mr daley said that probably the best role that we can play is oversight and just to make sure that people are doing with a shed and again i want to thank you for being here and thank you for what you're doing and  working in the largest or second largest government agency that we have and sometimes not using getting the tools that you need to be up to date and i appreciate that so thank you very much and with that