GAO-03-877R DOD Business Enterprise Architecture

United States General Accounting Office 

Washington, DC 20548 

July 7, 2003 

Congressional Committees 

Subject: Business Systems Modernization: Summary of GAO’s Assessment of the 

Department of Defense’s Initial Business Enterprise Architecture (GAO-03-877R) 

The Department of Defense (DOD) faces financial and related management problems that are 

pervasive, complex, long-standing, and deeply rooted in virtually all business operations 

throughout the department. These problems have impeded the department’s ability to 

provide complete, reliable, and timely business information to the Congress, DOD managers, 

and other decision makers. Of the 25 areas on our governmentwide “high-risk” list, 6 are 

DOD program areas, and the department shares responsibility for 3 other high-risk areas that 

are governmentwide in scope.1 DOD’s problems in each of these areas hinder the efficiency 

of operations, and leave the department vulnerable to fraud, waste, and abuse. 

For fiscal year 2003, DOD’s information technology (IT) budget request was over $26 

billion. More specifically, to support its business operations, DOD reports that it currently 

relies on about 2,300 systems, including accounting, acquisition, logistics, and personnel 

systems that will cost about $18 billion—nearly $5.2 billion for business systems2 and $12.8 

billion primarily for business systems infrastructure—in fiscal year 2003 to operate, 

maintain, and modernize. As we have previously reported,3

 this environment was not 

designed to be, but rather has evolved into, an overly complex and error-prone environment, 

including (1) little standardization across DOD, (2) multiple systems performing the same 

tasks, (3) the same data stored in multiple systems, and (4) manual data entry into multiple 

systems. 

One of the seven key elements we have reported4 as necessary to successfully reform DOD’s 

financial and related management challenges is establishing and implementing an enterprise 

 

1

U.S. General Accounting Office, High-Risk Series: An Update, GAO-03-119 (Washington, D.C.: January 

2003). The nine interrelated high-risk areas that represent the greatest challenge to DOD’s development of 

world-class business operations to support its forces are contract management, financial management, support 

infrastructure management, inventory management, systems modernization, weapon system acquisition, human 

capital, information security, and real property. The last three areas are governmentwide in scope. 

2

Business systems include financial and nonfinancial systems, such as civilian personnel, finance, health, 

logistics, military personnel, procurement, and transportation, with the common element being the generation or 

use of financial data to support DOD’s business operations. 

3

U.S. General Accounting Office, DOD Financial Management: Important Steps Underway But Reform Will 

Require a Long-term Commitment, GAO-02-784T (Washington, D.C.: June 4, 2002). 

4

GAO-02-784T. 
Page 2 GAO-03-877R DOD Business Enterprise Architecture 

architecture, or modernization blueprint. In May 2001,5 we recommended that DOD 

develop, maintain, and implement an enterprise architecture to modernize its financial 

management operations and systems across the department. Subsequently, in its fiscal year 

2002 Performance and Accountability Report, DOD acknowledged that deficiencies in its 

business systems hindered the department’s ability to collect and report financial and 

performance information that is accurate, reliable, and timely. The report noted that to 

address its systemic problems and assist in the transformation of the department’s business 

operations, the department had undertaken the development and implementation of a 

business enterprise architecture. 

An enterprise architecture provides a clear and comprehensive picture of an entity, whether it 

is an organization (e.g., federal department or agency) or a functional or mission area that 

cuts across more than one organization (e.g., financial management). This picture consists of 

snapshots of both the enterprise’s current or “As Is” operational and technological 

environment and its target or “To Be” environment, as well as a capital investment road map 

for transitioning from the current to the target environment. These snapshots further consist 

of “views,” which are basically one or more architecture products that provide conceptual or 

logical representations of the enterprise. 

The National Defense Authorization Act for Fiscal Year 20036

 required DOD to develop, by 

May 1, 2003, a financial management enterprise architecture7 and a transition plan for 

implementing the architecture to meet certain requirements. The act also requires DOD to 

control expenditures for financial system improvements while the architecture and transition 

plan are being developed and after they are completed. The act states that the enterprise 

architecture shall describe an information infrastructure that, at a minimum, would enable 

DOD to achieve certain capabilities, such as complying with all federal accounting, financial 

management, and reporting requirements. The act also requires development of a transition 

plan for implementing the enterprise architecture that includes, among other things, a 

schedule for phasing out existing financial management systems that will not become part of 

the “To Be” environment. Finally, before the architecture and transition plan are approved, 

the act requires DOD to review proposed obligations of funds in amounts exceeding $1 

million for financial system improvements to determine if they meet specific conditions 

called for in the act. Once the architecture and transition plan are approved, the act requires 

DOD to ensure that financial system investments are consistent with the architecture and the 

transition plan. 

 

5

U.S. General Accounting Office, Information Technology: Architecture Needed to Guide Modernization of 

DOD’s Financial Operations, GAO-01-525 (Washington, D.C.: May 17, 2001). 

6

Bob Stump National Defense Authorization Act for Fiscal Year 2003, Pub. L. No. 107-314, § 1004, 116 Stat. 

2458, 2629, Dec. 2, 2002. 

7

In May 2003, the DOD Comptroller changed the architecture name from the Financial Management Enterprise 

Architecture to the Business Enterprise Architecture to reflect the transformation of departmentwide business 

operations and supporting systems, including accounting and finance, budget formulation, acquisition, 

inventory management, logistics, personnel, and property management systems. 
Page 3 GAO-03-877R DOD Business Enterprise Architecture 

The act directs us to submit to congressional defense committees, within 60 days of DOD’s 

approval of its enterprise architecture and its transition plan, an assessment of DOD’s actions 

taken to comply with these requirements. (See enc. I for a copy of section 1004 of the act.) 

As agreed with your offices, our objectives were to determine (1) the extent to which DOD’s 

actions complied with the requirements of the act and (2) DOD’s plans for further 

development and implementation of its enterprise architecture. This report transmits a 

summary of the results of our assessment as well as a brief discussion of our key 

observations. (See enc. II for a summary of our assessment approach.) We plan to issue a 

more detailed report of our assessment results, including conclusions and specific 

recommendations. We performed our work from March 2003 through June 2003 in 

accordance with U.S. generally accepted government auditing standards. On June 30, 2003, 

DOD provided us with written comments on a draft of this report, which are addressed in the 

“Agency Comments and our Evaluation” section and are reprinted in enclosure III. 

Summary of Observations

As we reported in February 2003,8

 DOD undertook a challenging and ambitious task—to 

develop within 1 year a departmentwide architecture for modernizing its current financial and 

business operations and systems. Thus far, DOD has expended tremendous effort and 

resources and made important progress in complying with the legislative requirements aimed 

at developing and effectively implementing a well-defined enterprise architecture. Further, 

DOD’s initial version of its business enterprise architecture provides a foundation from 

which to build and ultimately produce a well-defined business enterprise architecture. 

However, the initial version does not adequately address the act's requirements 

and other relevant architectural requirements.9

 For example, the architecture does not 

adequately describe the accounting and financial management requirements and the logical 

database model, which includes data standards and is used to guide the creation of the 

physical databases where information will be stored. Moreover, DOD has yet to implement 

an effective investment management process for controlling ongoing and planned business 

system improvements, including one that meets the act’s requirements for ensuring that 

obligations in excess of $1 million are consistent with the architecture and the transition plan. 

Collectively, this means that DOD has taken a positive first step, but much remains to be 

accomplished before DOD will have the kind of blueprint and associated investment controls 

to successfully modernize its business operations and supporting systems. 

 

8

U.S. General Accounting Office: DOD Business Systems Modernization: Improvements to Enterprise 

Architecture Development and Implementation Efforts Needed, GAO-03-458 (Washington, D.C.: Feb. 28, 

2003). 

9

See for example, Office of Management and Budget, Federal Enterprise Architecture Business Reference 

Model, Version 1.0 (2002); Chief Information Officer Council, A Practical Guide to Federal Enterprise 

Architecture, Version 1.0 (February 2001); Office of Management and Budget Circular No. A-130, 

Management of Federal Information Resources (Nov. 28, 2000); M.A.Cook, Building Enterprise Information 

Architectures: Reengineering Information Systems (Upper Saddle River, N.J.: Prentice Hall, 1996); and 

National Institute of Standards and Technology, Information Management Directions: The Integration 

Challenge, Special Publication 500-167 (September 1989). 
Page 4 GAO-03-877R DOD Business Enterprise Architecture 

DOD's position is that, to varying degrees, the initial version of its architecture fully satisfies 

the act's requirements, but it also recognizes that the architecture needs to be expanded and 

extended to provide a sufficient basis for guiding and constraining investment decisions. 

DOD's position is also that it has taken steps to implement the act's requirements regarding 

approving system investments but that it needs to do more to effectively select and control 

system investments. DOD attributes the current state of its architecture and investment 

management processes to the limited time it has had to define and implement each, in part 

because it was overly optimistic in estimating what it could deliver by May 1, 2003. Until 

DOD develops and provides for effective implementation of a well-defined enterprise 

architecture, its ability to modernize its business and systems environments in a way that 

minimizes risk and maximizes return on investment will be severely hindered. 

Key Observations on Compliance with 

Enterprise Architecture Requirements

The department has established some of the architecture management capabilities advocated 

by best practices and federal guidance.10 Among these are having a program office staffed 

with representatives from across the DOD components, designating a chief architect, and 

using an architecture development methodology and automated tool. Further, it has adopted 

an incremental approach to developing its architecture and, according to DOD, has approved 

an initial version of its architecture that it intends to use as a foundation upon which to build. 

The initial version includes a suite of diagrams, tables, and other representations that 

describe, to varying degrees, its “As Is” and “To Be” architectural environments. For 

example, the “As Is” descriptions include an inventory of about 2,300 systems in operation or 

under development, and their characteristics, that support DOD’s current business operations. 

The “To Be” descriptions address, to at least some degree, how DOD intends to operate in 

the future, what information will be needed to support these future operations, and what 

technology standards should govern the design of future systems. 

DOD has also incorporated many relevant federal accounting, financial management, and 

reporting requirements from 152 federal sources in its “To Be” architecture products. Of the 

total 4,000 external requirements included in the initial architecture, our review of 1,767 

Joint Financial Management Improvement Program (JFMIP)11 requirements, identified 340 

(about 19 percent) that are not included or adequately addressed. For example, federal 

accounting requirements for recording revenue are not included. According to program 

officials, critical external requirements are not included or adequately addressed primarily 

because a fully functioning quality assurance process to validate the requirements was not in 

place when the requirements were elicited. As a result, the architecture’s descriptions of 

 

10U.S. General Accounting Office, Information Technology: A Framework for Assessing and Improving 

Enterprise Architecture Management (Version 1.1), GAO-03-584G (Washington, D.C.: April 2003). 

11JFMIP is a joint undertaking of the Department of the Treasury, GAO, the Office of Management and Budget, 

and the Office of Personnel Management, working with each other, other agencies, and the private sector to 

improve financial management in the federal government. JFMIP requirements arise from various public laws, 

regulations, bulletins, circulars, federal accounting standards, and leading practices and are applicable 

governmentwide. Agencies must use these requirements, in addition to agency-unique mission requirements, in 

planning and implementing their financial management improvement projects. 
Page 5 GAO-03-877R DOD Business Enterprise Architecture 

certain business processes, such as those associated with revenue accounting and reporting, 

which include over $70 billion earned annually by DOD working capital fund activities, are 

not yet sufficiently complete for making informed decisions on systems. Department and 

contractor officials agreed that these system requirements were either excluded or not 

adequately addressed and stated that a subsequent version of the architecture would include 

or modify the requirements. 

Additionally, the “As Is” and “To Be” architecture products and the transition plan do not 

include a number of items recommended by relevant architectural guidance.12 Program 

officials agreed that the initial version of the architecture does not contain the scope and 

detail needed to acquire business system solutions for its “To Be” environment. Program 

officials attribute this to DOD’s being overly optimistic in determining what it could develop 

by May 1, 2003. In an effort to manage this expectation gap, DOD officials are using an 

incremental approach for developing and implementing the architecture.

Specifically, the “As Is” view of the current architecture does not include the following 

items: 

• descriptions of current business operations in terms of the entities/people that perform 

the functions, processes, and activities, and the locations where the functions, 

processes, and activities are performed; 

• data/information being used by the functions, processes, and activities; 

• technology standards being employed; 

• security standards and tools being used; and 

• performance metrics being used. 

As a result, DOD does not have a sufficiently described picture of its “As Is” environment to 

permit development of a meaningful and useful transition plan that either identifies the 

proper sequence of changes needed to move from its current operating environment to its 

future target environment, or effectively provides for guiding and constraining investments in 

modernized systems. 

Additionally, the “To Be” view of the current architecture version does not include the 

following items: 

• specific organization and location information, which defines the entities/people that 

will perform the functions, processes, and activities, and specifies where the 

functions, processes, and activities will be performed; 

• physical descriptions of systems or applications to be developed or acquired; 

 

12See for example, Office of Management and Budget, Federal Enterprise Architecture Business Reference 

Model, Version 1.0 (2002); Chief Information Officer Council, A Practical Guide to Federal Enterprise 

Architecture, Version 1.0 (February 2001); Office of Management and Budget Circular No. A-130, 

Management of Federal Information Resources (Nov. 28, 2000); M.A.Cook, Building Enterprise Information 

Architectures: Reengineering Information Systems (Upper Saddle River, N.J.: Prentice Hall, 1996); and 

National Institute of Standards and Technology, Information Management Directions: The Integration 

Challenge, Special Publication 500-167 (September 1989). 
Page 6 GAO-03-877R DOD Business Enterprise Architecture 

• the physical infrastructure (e.g., hardware and systems software) that will be needed 

to support the business systems; and

• the organizations that will be accountable for security and their roles and 

responsibilities. 

Further, we found that the logical database model, which includes data standards and is used 

to guide the creation of the physical databases where information will be stored, is not linked 

to a conceptual data model. This raises concern regarding the utility of the logical model in 

supporting information flows for business operations and systems. 

As a result, the “To Be” environment lacks the details needed to identify and plan for system 

solutions and operational change, and enable DOD to routinely provide timely, accurate, and 

reliable information for management decision making. In addition, the “To Be” environment 

precludes the department from making informed system investment decisions. 

Aside from the “To Be” architecture’s lack of detail, its structure is difficult to navigate, thus 

constraining its ease of use and understandability. For example, the architecture does not 

include user instructions or guidance, and certain artifacts (e.g., diagrams) could not be read 

on-line because there was no “zoom” capability enabling enlargement. Further, specific 

content, such as the applicability of security standards to specific security services, were 

difficult to locate. While we were able to read certain artifacts and locate specific content 

after extraordinary effort, it is reasonable to expect that other users would also encounter 

difficulty navigating through the architecture products. As a result, users may not have a 

good understanding of the architecture’s content for use in making informed decisions. 

The transition plan is also missing important items, such as 

• a gap analysis identifying the needed changes to current business processes and 

systems; 

• an identification of which of the 2,300 current business systems will not become part 

of the “To Be” architecture as well as the time frames for phasing out these systems; 

• a time-based strategy for replacing legacy systems, including identification of 

intermediate (i.e., migration) systems that may be temporarily needed; and 

• a statement of resources (e.g., funding and staff) needed to transition to the target 

environment. 

As a result, DOD does not yet have a meaningful and reliable basis for managing the 

disposition of its existing inventory of about 2,300 systems or for sequencing the introduction 

of modernized business operations and supporting systems. 

In June 2003,13 DOD’s verification and validation contractor also assessed the initial 

architecture against relevant best practices to determine its quality. Consistent with our 

assessment, this contractor reported that while DOD’s architecture contained significant 

content, it lacked the depth and detail needed to begin building and implementing 

 

13MITRE Technical Report: Review of Financial Management Enterprise Architecture (FMEA), Version 1.0, 

June 2003.
Page 7 GAO-03-877R DOD Business Enterprise Architecture 

modernized systems and making operational changes. Further, the contractor reported that 

the architecture was not easily understandable and that its utility to stakeholders in system 

acquisition planning was limited. 

With regard to DOD’s actions to control ongoing and planned business systems investments, 

DOD has not yet defined and implemented an effective approach to select and control 

business system investments exceeding $1 million while the architecture is being developed 

and after it is completed. Program officials stated that the department’s current approach to 

selecting and controlling business system investments depends on the system owners coming 

forward with the request for approval, and that it has not established the means to determine 

which systems should be submitted for review. Program officials acknowledge that the 

department, at a minimum, could use DOD’s IT budget documentation to proactively fulfill 

the act’s requirements and strengthen the investment management process. Since enactment 

of the National Defense Authorization Act for Fiscal Year 2003, DOD has approved one 

business system improvement that met this $1 million threshold and is currently reviewing 

four others. Our analysis of DOD’s fiscal years 2003 and 2004 IT budget requests shows 

that over 200 systems in each year’s budget, totaling about $4 billion per year, could have 

resulted in obligations of funds that meet the $1 million threshold. As a result, the vast 

majority of the billions of dollars that DOD invests in business system improvements 

annually have not been subject to the specific investment control process called for in the act. 

Key Observations on DOD’s Plans for Evolving and Extending Its 

Enterprise Architecture and for Improving Business System 

Investment Decision Making 

According to program officials and the initial version of the transition plan, DOD intends to 

extend and evolve the architecture to include missing scope and detail. However, it has not 

defined specific plans outlining how this will be accomplished. Rather, DOD’s current plan 

is to develop a strategy for producing the next version of its architecture and managing 

ongoing and planned investments. Among other things, this strategy is to provide for 

• determining the resources needed to further develop the architecture; 

• developing a methodology for integrating the architecture with other internal and 

external architectures;

• establishing an approach for maintaining its existing systems inventory; and 

• evaluating the architecture for completeness, accuracy, and integration of end-to-end 

business processes and system functions. 

In addition, DOD program documentation provides for initiating pilot projects in the near 

term that are to demonstrate and implement a portion of the architecture and be usable across 

the department. However, DOD officials stated that the pilot projects are intended to validate 

departmentwide business processes and not to implement production systems. Because of 

these differing views of what the pilot projects are intended to achieve, the purpose and scope 

of these projects remain unclear and specific projects have yet to be selected. If DOD 

intends for these projects to demonstrate or validate an enterprisewide business process to 

address a current deficiency in DOD’s business operations and systems, such as the lack of 

common data standards, these projects could help DOD improve its architecture and thus 
Page 8 GAO-03-877R DOD Business Enterprise Architecture 

may represent reasonable investments. However, if the pilot projects are to be used to 

acquire and implement system solutions and place them into production to achieve an 

operational capability, it is unclear how DOD will ensure architecture alignment and manage 

the risk associated with investing in even more systems before it has a well-defined blueprint 

and an effective investment management process to guide and control them. 

With regard to DOD’s plans for improving investment management controls, DOD has a 

proposed governance concept that describes how and by whom business transformation 

requirements identified by the architecture will be implemented in the department. This 

proposal vests domain owners (DOD business line representatives, such as those in logistics, 

human resource management, and acquisition/procurement) with the authority, 

responsibility, and accountability for business transformation, extension and implementation 

of the architecture, development and execution of the transition plan, and investment 

portfolio management for their domains. However, it is not clear how the proposed 

approach, including the act’s requirements, will be implemented. Further, it is not clear, 

given the incomplete state of version 1.0 of the architecture (1) how the domain owners will 

ensure consistency across domains for architecture extensions and changes and (2) how the 

proposed approach will address our prior recommendations for establishing a hierarchy of 

investment review boards that use an explicit and common set of criteria for selecting, 

controlling, and evaluating IT projects as a portfolio of competing investment options. One 

criterion we recommended was to ensure consistency and compliance with ongoing 

architecture development efforts.14 As a result, the department does not have a critical 

structure in place to effectively select and control its IT investments, and runs the risk of 

continuing to invest in systems that perpetuate its existing incompatible, duplicative, overly 

costly environment of about 2,300 business systems that do not optimally support mission 

performance. 

Agency Comments and Our Evaluation

In commenting on a draft of this report (reprinted in enc. III), DOD generally agreed with our 

assessment of the department’s initial business enterprise architecture and recognized that 

“much work remains to be done.” It then described this work as beginning the transition 

from its “As Is” environment to the “To Be” as defined in the architecture. DOD stated that 

its approach for transitioning focuses on reengineering its business processes incrementally 

and then selecting business system solutions to implement the new methods and practices. 

However, as we reported, the initial version of the architecture lacks the scope and content 

needed to provide a sufficient frame of reference for moving the department from its current 

operating environment to its future target environment. Moreover, we stated in the report 

that DOD’s plans for extending and evolving the architecture have yet to be adequately 

defined. While reengineering business processes is a logical component of what needs to be 

done to evolve the architecture, our report identifies many other aspects of the architecture, 

and the transition, that need to be further defined before DOD will have a sufficient basis for 

evaluating and selecting business system solutions. 

 

14GAO-03-458. 
Page 9 GAO-03-877R DOD Business Enterprise Architecture 

DOD’s comments also recognized the need to manage and control its ongoing and planned 

business system investments, and stated that it has defined an approach for doing so in draft 

guidance and would use its transformation governance structure to implement the investment 

management process. This guidance is still in draft and DOD has not provided it to us. 

Therefore, we could not determine whether it addresses the limitations in the department’s 

existing approach to select and control its business system investments or the uncertainties 

associated with its proposed investment governance approach, both of which are discussed in 

this report. 

Last, DOD’s comments noted that the cost to operate, maintain, and modernize its 

approximately 2,300 systems is about $5 billion and that $13 billion provides infrastructure 

for all DOD systems and includes spending on nonbusiness (e.g., command and control or 

intelligence) systems. We do not agree. Specifically, our analysis of DOD’s total IT budget 

request for fiscal year 2003 shows approximately $26 billion, of which $5 billion relates to 

the operation, maintenance, and modernization of DOD’s business systems; about $13 billion 

relates primarily to the infrastructure to support these business systems; and the remaining $8 

billion relates primarily to command and control systems, including the infrastructure to 

support these systems. 

- - - - - 

We will be sending copies of this report to interested congressional committees; the Director, 

Office of Management and Budget; the Secretary of Defense; the Under Secretary of Defense 

(Comptroller); the Assistant Secretary of Defense (Networks and Information Integration)/ 

Chief Information Officer; the Under Secretary of Defense (Acquisition, Technology, and 

Logistics); the Under Secretary of Defense (Personnel and Readiness); and the Director, 

Defense Finance and Accounting Service. This report will also be available at no charge on 

our Web site at http://www.gao.gov. 
Page 10 GAO-03-877R DOD Business Enterprise Architecture 

If you have any questions concerning this information, please contact Gregory Kutz at (202) 

512-9095 or kutzg@gao.gov or Randolph Hite at (202) 512-3439 or hiter@gao.gov. GAO 

contacts and key contributors to this report are listed in enclosure IV. 

Gregory D. Kutz 

Director, Financial Management and Assurance 

Randolph C. Hite 

Director, Information Technology Architecture 

 and Systems Issues 

Enclosures 
Page 11 GAO-03-877R DOD Business Enterprise Architecture 

List of Committees 

The Honorable Ted Stevens 

Chairman 

The Honorable Robert C. Byrd 

Ranking Minority Member 

Committee on Appropriations 

United States Senate 

The Honorable John W. Warner 

Chairman 

The Honorable Carl Levin 

Ranking Minority Member 

Committee on Armed Services 

United States Senate 

The Honorable C.W. Bill Young

Chairman 

The Honorable David R. Obey 

Ranking Minority Member 

Committee on Appropriations 

House of Representatives 

The Honorable Duncan Hunter 

Chairman 

The Honorable Ike Skelton 

Ranking Minority Member 

Committee on Armed Services 

House of Representatives 

The Honorable Jim Saxton 

Chairman 

The Honorable Martin T. Meehan 

Ranking Minority Member 

Subcommittee on Terrorism, Unconventional Threats and Capabilities 

Committee on Armed Services 

House of Representatives 
Page 12 GAO-03-877R DOD Business Enterprise Architecture 

Enclosure I 

SEC. 1004. [of Public Law 107-314] DEVELOPMENT AND IMPLEMENTATION OF 

FINANCIAL MANAGEMENT ENTERPRISE ARCHITECTURE 

(a) REQUIREMENT FOR ENTERPRISE ARCHITECTURE AND FOR TRANSITION 

PLAN— 

Not later than May 1, 2003, the Secretary of Defense shall develop— 

(1) a financial management enterprise architecture for all budgetary, accounting, 

finance, enterprise resource planning, and mixed information systems of the 

Department of Defense; and 

(2) a transition plan for implementing that financial management enterprise 

architecture. 

(b) COMPOSITION OF ENTERPRISE ARCHITECTURE— 

(1) The financial management enterprise architecture developed under subsection (a)(1) shall 

describe an information infrastructure that, at a minimum, would enable the Department of 

Defense to— 

(A) comply with all Federal accounting, financial management, and reporting 

requirements; 

(B) routinely produce timely, accurate, and reliable financial information for 

management purposes; 

(C) integrate budget, accounting, and program information and systems; and 

(D) provide for the systematic measurement of performance, including the ability to 

produce timely, relevant, and reliable cost information. 

(2) That enterprise architecture shall also include policies, procedures, data standards, and 

system interface requirements that are to apply uniformly throughout the Department of 

Defense. 

(c) COMPOSITION OF TRANSITION PLAN—The transition plan developed under 

subsection (a)(2) shall include the following: 

(1) The acquisition strategy for the enterprise architecture, including specific time-phased 

milestones, performance metrics, and financial and nonfinancial resource needs. 

(2) A listing of the mission critical or mission essential operational and 

developmental financial and nonfinancial management systems of the Department of 

Defense, as defined by the Under Secretary of Defense (Comptroller), consistent with budget 

justification documentation, together with 

(A) the costs to operate and maintain each of those systems during fiscal year 

2002; and 

(B) the estimated cost to operate and maintain each of those systems during 

fiscal year 2003. 

(3) A listing of the operational and developmental financial management systems of the 

Department of Defense as of the date of the enactment of this Act (known as ‘legacy 

systems’) that will not be part of the objective financial and nonfinancial management 

system, together with the schedule for terminating those legacy systems that provides for 

reducing the use of those legacy systems in phases. 
Page 13 GAO-03-877R DOD Business Enterprise Architecture 

(d) CONDITIONS FOR OBLIGATION OF SIGNIFICANT AMOUNTS FOR FINANCIAL 

SYSTEM IMPROVEMENTS—An amount in excess of $1,000,000 may be obligated for a 

defense financial system improvement only if the Under Secretary of Defense (Comptroller) 

makes a determination regarding that improvement as follows: 

(1) Before the date of an approval specified in paragraph (2), a determination that 

the defense financial system improvement is necessary for either of the following reasons: 

(A) To achieve a critical national security capability or address a critical requirement in 

an area such as safety or security. 

(B) To prevent a significant adverse effect (in terms of a technical matter, cost, or 

schedule) on a project that is needed to achieve an essential capability, taking into 

consideration in the determination the alternative solutions for preventing the adverse 

effect. 

(2) On and after the date of any approval by the Secretary of Defense of a financial 

management enterprise architecture and a transition plan that satisfy the requirements of this 

section, a determination that the defense financial system improvement is consistent with 

both the enterprise architecture and the transition plan. 

(e) CONGRESSIONAL REPORTS—Not later than March 15 of each year from 2004 

through 2007, the Secretary of Defense shall submit to the congressional defense committees 

a report on the progress of the Department of Defense in implementing the enterprise 

architecture and transition plan required by this section. Each report shall include, at a 

minimum— 

(1) a description of the actions taken during the preceding fiscal year to implement the 

enterprise architecture and transition plan (together with the estimated costs of such actions); 

(2) an explanation of any action planned in the enterprise architecture and transition plan to 

be taken during the preceding fiscal year that was not taken during that fiscal year; 

(3) a description of the actions taken and planned to be taken during the current fiscal year to 

implement the enterprise architecture and transition plan (together with the estimated costs of 

such actions); and 

(4) a description of the actions taken and planned to be taken during the next fiscal year to 

implement the enterprise architecture and transition plan (together with the estimated costs of 

such actions). 

(f) COMPTROLLER GENERAL REVIEW—Not later than 60 days after the approval of an 

enterprise architecture and transition plan in accordance with the requirements of subsection 

(a), and not later than 60 days after the submission of an annual report required by subsection 

(e), the Comptroller General shall submit to the congressional defense committees an 

assessment of the extent to which the actions taken by the Department comply with the 

requirements of this section. 

(g) DEFINITIONS—In this section: 

(1) The term ‘defense financial system improvement’ means the acquisition of a new 

budgetary, accounting, finance, enterprise resource planning, or mixed information system 

for the Department of Defense or a modification of an existing budgetary, accounting, 

finance, enterprise resource planning, or mixed information system of the Department of 

Defense. Such term does not include routine maintenance and operation of any such system. 

(2) The term ‘mixed information system’ means an information system that supports 

financial and non-financial functions of the Federal Government as defined in Office of 

Management and Budget Circular A-127 (Financial management Systems). 
Page 14 GAO-03-877R DOD Business Enterprise Architecture 

(h) REPEAL—(1) Section 2222 of title 10, United States Code, is repealed. The table of 

sections at the beginning of chapter 131 of such title is amended by striking the item relating 

to such section. 

(2) Section 185(d) of such title is amended by striking ‘has the meaning given that term in 

section 2222(c)(2) of this title’ and inserting ‘means an automated or manual system from 

which information is derived for a financial management system or an accounting system’. 
Page 15 GAO-03-877R DOD Business Enterprise Architecture 

Enclosure II 

Summary of Assessment Approach

To accomplish our objectives for determining (1) the extent to which DOD’s actions 

complied with the requirements of section 1004 of Public Law 107-314 and (2) DOD’s plans 

for further development and implementation of the architecture, we assessed DOD’s initial 

architecture, which the DOD Comptroller transmitted to the Comptroller General on May 8, 

2003. Consistent with the act and as agreed with congressional defense committees’ staffs, 

this assessment focused on compliance with all federal accounting, financial management, 

and reporting requirements; the content of the “As Is” and “To Be” environments; the content 

of the transition plan to include time-phased milestones for phasing out existing systems, 

resource needs for implementing the “To Be” environment, and information on the systems 

inventory; and the extent to which DOD is controlling its business system investments. 

We also used our Enterprise Architecture Management Maturity Framework15 that describes 

the five stages of management maturity to determine the extent to which DOD has adopted 

key elements of architecture management best practices. To make this determination, we 

reviewed program documentation, such as program policies and procedures and architecture 

products, and compared them to the elements in the framework. 

 

Specific to our review of federal requirements, we could not determine whether the 

architecture contained all federal accounting, financial management and reporting 

requirements because a central repository of all such requirements does not exist. 

Nevertheless, to assess the completeness of the federal requirements, we compared the about 

4,000 external16 requirements contained in the architecture to those listed in selected JFMIP17

federal systems requirements publications. The JFMIP requirements consisted of about 45 

percent of the total external requirements. We performed a detailed review of 1,767 of the 

JFMIP requirements. 

To review the “As Is” and “To Be” environments and the transition plan, we decomposed 

version 1.0 of the architecture into various parts and components and made a comparison 

against relevant benchmarks. More specifically, we first divided the architecture into the 

three primary component parts specified in the act and recognized in best practices and 

federal guidance: the “As Is” architecture, the “To Be” architecture, and the transition plan. 

We then divided the “As Is” and the “To Be” architectures into the six architectural 

 

15GAO-03-584G. 

16External requirements are those that are obtained from authoritative sources and constrain various aspects of 

the architecture. 

17We used nine JFMIP systems requirements documents: revenue, acquisition, core financial, human resources 

and payroll, managerial cost accounting, inventory, travel, property management, and benefits. 
Page 16 GAO-03-877R DOD Business Enterprise Architecture 

components. We then compared version 1.0 to (1) relevant criteria18 governing the content of 

key architectural elements for the transition plan and (2) the six components of the “As Is” 

and “To Be” architectures. In addition, we reviewed comments from DOD’s verification and 

validation contractor (MITRE). 

To review DOD’s actions to comply with the $1 million obligation threshold for financial 

system improvements, we obtained and reviewed memorandums and other documentation 

regarding the approval of expenditures for system investments in excess of $1 million. We 

also reviewed and analyzed the DOD IT budget requests for fiscal years 2003 and 2004 to 

identify systems that met the $1 million threshold and compared this to the total number of 

systems DOD reviewed and approved to measure the extent of systems that potentially 

should be reviewed. 

To determine DOD’s plans for further development and implementation of the architecture, 

we reviewed the performance work statement; DOD’s proposed governance concept, 

including domain owner roles and responsibilities; and program documentation pertaining to 

plans for implementing pilot projects. We also reviewed the status of DOD’s response to our 

prior recommendations pertaining to controlling ongoing and planned IT systems 

investments. 

To augment our document reviews and analyses, we interviewed officials from various DOD 

organizations and contractors, including the Office of the Under Secretary of Defense 

(Comptroller); Office of the Under Secretary of Defense (Acquisition, Technology, and 

Logistics); Office of the Under Secretary of Defense (Personnel and Readiness); IBM; and 

MITRE Corporation. 

We conducted our work primarily at DOD headquarters offices in Washington, D.C., and 

Arlington, Virginia, from March 2003 through June 2003 in accordance with U.S. generally 

accepted government auditing standards. On June 30, 2003, DOD provided us with written 

comments on a draft of this report, which are addressed in the “Agency Comments and Our 

Evaluation” section and are reprinted in enclosure III. 

 

18See for example, Office of Management and Budget, Federal Enterprise Architecture Business Reference 

Model, Version 1.0 (2002); Chief Information Officer Council, A Practical Guide to Federal Enterprise 

Architecture, Version 1.0 (February 2001); Office of Management and Budget Circular No. A-130, 

Management of Federal Information Resources (Nov. 28, 2000); M.A.Cook, Building Enterprise Information 

Architectures: Reengineering Information Systems (Upper Saddle River, N.J.: Prentice Hall, 1996); and 

National Institute of Standards and Technology, Information Management Directions: The Integration 

Challenge, Special Publication 500-167 (September 1989). 
Page 17 GAO-03-877R DOD Business Enterprise Architecture 

Enclosure III 

Comments from the Department of Defense

 
Page 18 GAO-03-877R DOD Business Enterprise Architecture 
Page 19 GAO-03-877R DOD Business Enterprise Architecture 

Enclosure IV 

GAO Contacts and Staff Acknowledgments

GAO Contacts Jenniffer Wilson, (202) 512-9192 

Cynthia Jackson, (202) 512-5086 

Acknowledgments In addition to the individuals named above, key 

contributors to this report included Beatrice Alff, Nabajyoti Barkakati, 

Justin Booth, Francine DelVecchio, Francis Dymond, Neelaxi 

Lakhmani, Anh Le, Evelyn Logue, Mai Nguyen, Darby Smith, Stacey 

Smith, Alan Steiner, Randolph Tekeley, and William Wadsworth. 

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