Questions concerning this policy chapter should be directed to:

• Veterans Health Administration
• Veterans Benefits Administration
• National Cemetery Administration
• Debt Management Center
• Financial Services Center
• Construction and Facilities Management
• All others

0101 Overview

This chapter establishes the Department of Veterans Affairs’ (VA) overarching strategy for the development and update of financial policies to meet statutory, regulatory, and departmental standards.

Key Points covered in this chapter include:

• Assistant Secretary for Management and Chief Financial Officer (ASM/CFO) will promulgate Department-wide policies for effective financial management and control;
• Financial Policy Steering Committee (FPSC) is responsible for assisting in the development of policy to support the objectives, strategies, and goals set forth by the Chief Financial Officer Council (CFOC); and
• Financial Policy Working Group (FPWG) members will assist in ensuring that VA’s financial policies are developed and updated in compliance with applicable laws, regulations, guidance issued by control agencies (e.g., OMB and Treasury) and standards promulgated by standard setting boards (e.g., Federal Accounting Standards Advisory Board).

0102 Revisions

Section	Revision	Office	Reason for Change	Effective Date
Various	Full review change to reinstate Financial Policy Steering Committee (FPSC) process and responsibilities.	OFP	Reestablished FPSC requirements throughout policy.	November 2024
Various	Removed Chief Financial Officer Council (CFOC) requirements throughout policy to be reestablished in separate policy.	OFP	Removed CFOC requirements from this chapter to be added to new CFOC chapter.	November 2024
010504	Removed CFOC membership table from policy.	OFP	Removed membership table.	November 2024
Header	Changed chapter number from Chapter 1 to Chapter 1A and removed Accounting from policy name.	OFP	Created new CFOC policy and reestablished chapter hierarchy.	November 2024
Appendix A	Removed CFOC charter and replaced with previous policy revisions.	OFP	Removed charter from policy to reestablish in new chapter.	November 2024
Appendix B	Added FPSC membership.	OFP	Added list of FPSC members.	November 2024

0103 Definitions

Accounting – The function of classifying, recording, controlling, analyzing, and reporting financial data.

Accounting Standards or Principles – A common set of accounting principles, standards, rules, and concepts issued by a rule-setting body, governing how accounting transactions are to be recorded and reported. The Federal Accounting Standards Advisory Board (FASAB) is an example of a rule-setting body.

Other Key Officials – Executive Director, Office of Accountability and Whistleblower Protection; Chairman, Board of Veterans’ Appeals (BVA); Chief of Staff of Veterans Affairs (COSVA); Director, Center for Faith Based and Neighborhood Partnerships (00FB); Director, Center for Minority Veterans (CMV); Director, Center for Women Veterans (CWV); Director, Office of Small and Disadvantaged Business Utilization (OSDBU); Director, Office of Survivors’ Assistance (00SA); General Counsel, Office of General Counsel (OGC); Inspector General, Office of Inspector General (OIG); Principal Executive Director for Office of Acquisition, Logistics, and Construction (OALC); and the Chief Veterans Experience Officer (VEO).

0104 Roles and Responsibilities

Assistant Secretary for Management and Chief Financial Officer (ASM/CFO) oversees all financial management activities relating to the Department’s programs and operations, as required by the Chief Financial Officers Act of 1990 and 38 U.S.C. §309. ASM/CFO is responsible for the direction, establishment, management, and provision of policy guidance and oversight of VA’s financial management personnel, activities, and operations. In addition, ASM/CFO is responsible for chairing FPSC meetings and casting tiebreaking votes when necessary. ASM/CFO has delegated chair responsibilities and tiebreaking votes to Associate Deputy Assistant Secretary (ADAS) for Financial Policy.

Under Secretaries, Assistant Secretaries, and Other Key Officials are responsible for ensuring compliance with the policies and procedures set forth in this and other financial policy chapters.

Administration and Staff Office Chief Financial Officers, Fiscal Officers and Other Financial Officials are responsible for assisting and cooperating with the ASM/CFO to carry out VA’s financial responsibilities and for providing input in the formulation of financial policy.

Chief Financial Officer Council (CFOC) is responsible for providing guidance to the FPSC and ASM/CFO with respect to VA’s financial policies.

Financial Policy Steering Committee (FPSC) is responsible for reviewing and approving VA’s financial policies.

Financial Policy Working Group (FPWG) is responsible for reviewing and recommending changes to VA Financial policies and briefing their respective FPSC members on voting decisions.

Office of Finance Policy (OFP) is responsible for the VA financial policy process to include developing, coordinating, reviewing, evaluating, and issuing VA financial policies.

0105 Policies

010501 General Policies

1. VA financial policies provide high-level guidance that aligns with statutory and regulatory requirements, as well as requirements issued by control agencies and standard-setting bodies such as the Office of Management and Budget (OMB) and the Federal Accounting Standards Advisory Board (FASAB).
2. In accordance with the Chief Financial Officer’s Act of 1990 (CFO Act), the ASM/CFO will promulgate Department-wide policies for effective financial management and control.
3. VA policy will follow FASAB Statement of Federal Financial Accounting Standard (SFFAS) 34, The Hierarchy of Generally Accepted Accounting Principles, including the Application of Standards Issued by the Financial Accounting Standards Board.
4. Administrations and Staff Offices are responsible for adhering to and implementing the financial policies of the Department.
5. Administrations and Staff Offices will ensure that organization-specific policies are in alignment with Departmental financial policy.
6. Administration and Staff Office policy cannot be less restrictive than the Department’s policy.
7. Office of Financial Policy (OFP) will ensure that accounting and financial policy is updated when changes occur to:
   • United States Code (U.S.C.);
   • Code of Federal Regulations (C.F.R.);
   • Control Agency (e.g., OMB and Treasury) circulars, bulletins, manuals, and memoranda;
   • FASAB concepts, standards, bulletins, and other pronouncements; and
   • Audit findings.
8. OFP will periodically review and update the current inventory of financial policy chapters, to ensure that policies are updated to address gaps or deficiencies that may be caused by changes in existing or new legislation, regulatory requirements, or Departmental policies.
9. Initial policy inquiries should be directed to the appropriate Administration or Staff Office’s financial policy experts. Contacting appropriate staff will ensure timely responses and help the Administrations and Staff Offices identify specific training needs. Administration and Staff Office experts will forward an inquiry to OFP only if they cannot provide an adequate response.

010502 Financial Policy Steering Committee Responsibilities

1. Members of the Financial Policy Steering Committee (FPSC) will aid in developing policy by providing recommendations and information necessary for the creation of Departmental policy.
2. FPSC members will assist in ensuring that VA’s financial policies are developed and updated in compliance with applicable laws, regulations, generally accepted accounting principles, and other published standards.
3. FPSC members are responsible for the review and approval of VA’s financial policies.
4. The FPSC is a sub-committee of the Chief Financial Officers Council (CFOC).
5. The FPSC will report on policy additions, updates, modifications, and deletions at CFOC meetings.
6. FPSC members will vote on VA’s financial policies. Each voting member (or designee) will have one vote.
   1. Generally, voting will occur electronically. Voting members can designate one person as their backup to cast a vote in their absence.
   2. Non-responses to voting requests are considered affirmative votes to approve the policy.
   3. Although FPSC members voting responsibilities are key to delivering strong balanced accepted policies, the VA CFO retains the authority to unilaterally approve or disapprove any policy.
7. FPSC voting members (or their designees) will attend all scheduled FPSC meetings. If the voting member cannot attend, he or she will appoint a designee to act in his or her place for that meeting. FPSC members will:
   • Provide oversight and accountability at the senior management level for VA’s financial policies and procedures;
   • Assist management at all levels in fostering an organizational environment that supports an on-going awareness of and compliance with updated or new financial policies and procedures;
   • Ensure efforts are on-going to meet the responsibilities for formulating or revising and reviewing VA’s financial policies and procedures;
   • Act as a body to adjudicate policy decisions;
   • Ensure that the objectives of the initiative to update or develop VA financial policies and procedures are clearly communicated throughout the Department;
   • Ensure that initiative-related activities are carried out in a thorough, effective, and timely manner;
   • Review, discuss, and make decisions pertaining to recommendations from their Administration or Staff Office; and
   • Notify OFP of any changes to their FPSC representative.
8. FPSC members will assign senior members of their staff to the Financial Policy Workgroup (FPWG).

010503 FPSC Membership

1. ASM/CFO is the chairperson of the FPSC. The ASM/CFO has designated the Associate Deputy Assistant Secretary for Office of Financial Policy (ADAS OFP) to perform this responsibility.
2. OFP will maintain the FPSC membership and work with Administrations and Staff Offices to review and update membership and appoint additional members as necessary.
3. The FPSC will be comprised of representatives from VA’s three Administrations, and selected Staff Offices. Refer to Appendix B for FPSC members.

010504 FPSC Meetings

1. The FPSC will schedule meetings as necessary to address financial policy related concerns and or issues.
2. FPSC members (or their designees) will attend all scheduled meetings. If a member cannot attend, he or she will appoint a designee to act in his or her place for that meeting.
3. To ensure the most efficient use of meeting time, FPSC member analysis and discussion of policy issues must take place prior to FPSC meetings.

010505 Financial Policy Working Group (FPWG)

1. The FPWG, a subcommittee to the FPSC, is established to assist in implementing the philosophy, objectives, strategies, and goals set forth by the FPSC.
2. FPWG members support their FPSC representative and OFP in developing policy by ensuring that their perspective and requirements are incorporated into policy prior to the policy being sent for voting by the FPSC.
3. FPWG members will be selected by their organizations FPSC member.
4. Should the FPSC member designate multiple FPWG members, the FPSC member must designate one individual as the main FPWG Point of Contact (POC) to coordinate responses from their organization.
5. FPWG members will ensure policies are being reviewed by the appropriate Subject Matter Experts (SMEs).
6. To ensure that policy is written in a timely manner, FPWG members will work to obtain consensus within their organization and provide OFP with comments and updates within scheduled timelines.
7. FPWG members are responsible for briefing their respective FPSC member on proposed policies to facilitate decision making and voting. Briefings to the FPSC voting member should occur while the policy is being circulated through the FPWG so that the voting members philosophy, objectives, strategies, and goals can be incorporated prior to commencement of the voting process.

010506 OFP Program Administration

1. OFP will periodically review FPWG and FPSC membership.
2. OFP will coordinate the financial policy review and update process through established SME, FPWG, and FPSC members.
3. Once policy has been approved by the FPSC, OFP will ensure that the policy is published on the OFP Publications Website.

010507 Requesting an Exception to Policy

1. Administrations and Staff Offices may request a policy waiver to reduce unnecessary burden or to ensure resources are available to meet various challenges faced by the Department.
2. OFP will review each waiver request and if warranted prepare a policy waiver memorandum for approval by the ASM/CFO. Waiver memorandums will specifically identify the requirement being waived, include an expiration date, and may note any additional responsibilities/tasks to be performed as offsetting or mitigating controls.
3. OFP will ensure that approved policy waivers are communicated (e.g., memo distribution, newsflash, etc.) throughout the Department.

0106 Authority and References

• United States Code
  • 31 U.S.C. §901 Chief Financial Officers Act of 1990
  • 38 U.S.C. §309
• Public Law 116-315
• Federal Accounting Standards Advisory Board (FASAB)
  • Financial Accounting Standards Board
  • FASAB Handbook of Federal Accounting Standards and Other Pronouncements
  • FASAB Statement of Federal Financial Accounting Standards 34, the Hierarchy of  Generally Accepted Accounting Principles
  • Statement of Federal Financial Accounting Standards  (SFFAS) 34, The Hierarchy of Generally Accepted Accounting Principles, including the  Application of Standards Issued by the Financial Accounting Standards Board.
• Office of Management and Budget (OMB)
  • OMB Circular A-123, Management’s Responsibility for Enterprise Risk Management and Internal Control, Appendix A, Internal Control over Financial Reporting
  • OMB Circular A-123, Management’s Responsibility for Enterprise Risk Management and Internal Control, Appendix D, Compliance with Federal Financial Management Improvement Act of 1996
  • OMB Circular A-134, Financial Accounting Principles and Standards
  • OMB Circular A-136 – Financial Reporting Requirements National Archives and Records Administration (NARA)
• VA Directive 0000, Delegation of Authority, Nov. 14, 2018
• Volume XIII, Chapter 6 Accounting During Declared Emergencies.

0107 Rescissions

Volume I, Chapter 1 VA Financial and Accounting Policy Overview, July 2023.

Appendix A: Previous Policy Revisions

Section	Revision	Office	Reason for Change	Date
Various	Performed full review and update to new policy format.	OFP (047G)	Performed full update of policy.	June 2023
0104	Updated Roles and Responsibilities for Administrations and Staff Offices.	OFP (047G)	Standardized Roles and Responsibilities.	June 2023
010501 General Policies	Moved language from Overview to General Policies	OFP (047G)	Format update.	June 2023
010503 CFOC Administrative Functions	Changed section name to CFOC Administrative Functions.	OFP (047G)	Changed section name to align with functions.	June 2023
0104	Updated roles and responsibilities for the Assistant Secretary for Management and Chief Financial Officer	OFP (047G)	Update policy to address recent P.L enactment	March 2021
010502	Added information from requiring VA CFO to participate in subordinate CFO interviews/selection and provide input on performance	OFP (047G)	Update policy to address recent P.L. enactment	March 2021
010508	Added information on requesting a waiver while operating in a declared emergency environment	OFP (047G)	Added waiver requests	March 2021
0105	Added information on CFOC voting, and CFO Signature	OFP (047G))	Change in policy approval process	March 2020
Appendix A	Added CFOC Charter	OFP (047G)	CFOC Charter added to policy	March 2020
0104	Added Executive Director, Office of Accountability and Whistleblower Protection to Other Key Officials	OFP (047G)	New Key Official	December 2017
Various	5-year review and update to new format. Eliminated duplication found in both the charter and policy. Referenced Policy	OFP (047G)	Reorganize the chapter layout	August 2017

Appendix B: FPSC Membership

Organization	Role	Title
Office of Management (OM)	Chair, Tie breaking vote	Assistant Secretary for Management (ASM)/Chief Financial Officer (CFO) (Delegated to ADAS for Financial Policy)
Office of Budget (OB)	Voting Member	DAS for Budget
Office of Asset Enterprise Management (OAEM)	Voting Member	Director, Office of Asset Enterprise Management
Office of Information and Technology (OI&T)	Voting Member	DAS for IT Resource Management
Office of Acquisition, Logistics and Construction (OALC)	Voting Member	Executive Director, Office of Acquisition and Logistics
Office of Construction & Facilities Management (CFM)	Voting Member	Associate Executive Director, Office of Resource Management
Veterans Benefits Administration (VBA)	Voting Member	VBA CFO
National Cemetery Administration (NCA)	Voting Member	NCA CFO
Veterans’ Health Administration (VHA)	Voting Member	VHA CFO
VHA Procurement and Logistics Office (PLO)	Voting Member	VHA Chief Procurement and Logistics Officer
Office of General Counsel (OGC)	Advisory Member	Deputy General Counsel, General Law
Office of Inspector General (OIG)	Advisory Member	Assistant Inspector General for Audits and Evaluations