This entry must equal the sum of all entries above for allotments or allocations to other bureaus or agencies.

For this entry, the titles of the schedules involved and the numbers of employees paid from each will be identified as part of the entry or on an attached sheet.

Employees of Office of the Secretary paid from allotment from "Salaries and expenses, Bureau of Internal Affairs"

Employees of Department of the Interior included above due to comparative transfers

.....

Employment reported to the Civil Service Commission

.....

In recent years, the financial management practices of the Federal Government have been given increasing attention and study by the executive agencies and the three central agencies-the General A Accounting Office, the Bureau of the Budget, and the Treasury Department-under the joint program for improving accounting. In addition, the recent (Hoover) Commission on Organization of the Executive Branch of the Government conducted a critical appraisal of existing practices that resulted in a series of recommendations for further development of financial management in Government.

Those recommendations were contained in the Budget and Accounting Report submitted to the Congress by the Commission in June 1955. Major proposals in that report suggested strengthening the managerial and budgeting functions of the Bureau of the Budget, placing additional emphasis on the accounting functions of the Bureau and the executive agencies, and broadening the development and use of costs in the financial affairs of Government. Other recommendations were directed toward related improvements in budgeting, accounting, and reporting practices. A complete list of the Commission's recommendations in the Budget and Accounting Report is provided in the appendixes.

The proposals of this second Hoover Commission, in effect, represented a broad endorsement of the objectives and activities of the joint accounting program. Presented against a background of the progress made in recent years, they identified problems which should be given priority attention at this time. The central agencies in the joint accounting program are now taking steps in accordance wth those proposals.

Of these central agencies, the Bureau of the Budget is most directly affected by the recommendations of the second Hoover Commission. Since those proposals were made, the Bureau has taken positive action toward implementation of the recommendations. It is the purpose of this pamphlet to relate these actions to existing practices, and discuss plans for further development

and improvement as they affect agencies throughout the Government.

Background

Basic legislation pertaining to the Bureau of the Budget is contained in the Budget and Accounting Act, 1921. This act established the Bureau and identified its basic budget and management functions. In relation to those assigned functions, the act of 1921 placed responsibility in the Bureau, when directed by the President, for making detailed studies of agency organization, activities, and business methods that would enable more efficient and economical operations. Executive Order No. 8248 of September 8, 1939, outlined the continuing responsibilities of the Bureau of the Budget in these fields.

With the advent of the joint accounting program in 1948, the Bureau established a staff unit to carry out the responsibilities of the Director of the Bureau of the Budget under the joint program. This was a relatively small operation in which primary emphasis was placed on coordinating the Bureau's budget and management activities with developments in the improvement of accounting and financial reporting under the joint accounting program. The Budget and Accounting Procedures Act of 1950 more specifically identified the accounting role of the Bureau of the Budget. That act expressed the intent of Congress that maintenance of accounting systems and development of financial reports were the responsibility of the executive branch; that emphasis should be placed on effecting orderly improvements toward more effective financial management practices; and that the Treasury Department, the General Accounting Office, and the Bureau of the Budget should conduct a continuous program for the improvement of accounting and financial reporting.

It specified that

the accounting of the Government provide * * * adequate financial information needed in *** the formulation and execution of the budget

that the accounting systems of the various agencies should be designed to provide

reliable accounting results to serve as
the basis for preparation and support
of the agency's budget requests, for
controlling the execution of its budget,
and for providing financial informa-
tion required by the Bureau of the
Budget-

and that the central financial reports of the Government to be prepared by the Treasury Department should include

such financial data as the Director of
the Bureau of the Budget may require
in connection with the preparation of
the budget or for other purposes of the
Bureau.

In addition, the Budget and Accounting Procedures Act of 1950 authorized and directed the President, through the Bureau of the Budget, to evaluate and develop improved plans for the organization, coordination, and management of the executive branch of the Government with a view to efficient and economical service.

Current developments

The Budget and Accounting Report of the second Hoover Commission gave recognition to the value of the joint accounting program and the improvements that had been made by the executive agencies in the conduct of their financial affairs. It recognized the cooperative assistance furnished by the General Acccounting Office to the agencies, and stressed the need for greater stimulation of agency improvements within the executive branch. In this connection, it noted the comparatively limited participation of the Bureau of the Budget in this joint effort, and emphasized this need by recommending a strengthening of the Bureau's participation and the establishment of a new staff Office of Accounting to provide the leadership required.

The latter proposal was intended to emphasize the accounting role of the Bureau of the Budget, to establish responsibility for accounting improvements in close proximity to existing responsibilities for budgetary improvements, and to give the accounting function increased stature in the executive branch. To insure the desired results, the Commission proposed that the new Office of Accounting be headed by an Assistant Director for Accounting, who would be given responsibility for developing and carrying out a comprehensive plan for accounting and reporting, and for assisting executive agencies in the introduction of modern account

ing methods and the development of competent accounting and auditing organizations.

After extensive evaluation and consideration of the Commission's budget and accounting proposals throughout the executive branch, the Director of the Bureau of the Budget developed plans for putting those recommendations into effect. As a first step, the accounting improvement staff in the Bureau were placed in an Office of Accounting under an Assistant Director, who was given responsibility for providing the desired leadership in this effort. The President approved these plans, as reflected in his correspondence, with the Director of the Bureau on this subject.

On May 10, 1956, the President transmitted to the Speaker of the House of Representatives a request for a supplemental appropriation to enable the Bureau of the Budget to carry out the recommendations of the second Hoover Commission for further improvement in executive branch budgeting, accounting, and management generally. In recognition of his responsibilities under section 104 of the Budget and Accounting Procedures Act of 1950, the President stated:

Expansion of the staff resources of the Bureau of the Budget is needed in order that the Bureau may provide, on my behalf, more active central leadership in the advancement of administration in the executive agencies.

With the supplemental funds appropriated, additional staff have been obtained for the Office of Accounting, to make a start toward the type of program visualized by the second Hoover Commission. Experience accumulated in the initial phase of this program will be used as the basis for further development according to the identified need.

The accounting staff of the Bureau will continue to work closely with the staff of the Bureau of the Budget that are responsible for the budget and management functions. This will serve to insure appropriate coordination of related requirements and the development of properly integrated budget and accounting systems. The additional staff facilities of the Bureau of the Budget will enable increased emphasis on working with the executive agencies in their developmental efforts.

Financial management improvement efforts will continue to be carried out within the framework of the joint accounting program. This program was initiated originally to give recognition to the need for joint action in the accounting field by the executive and legislative branches, and to avoid the jurisdictional conflicts that had arisen in previous attempts to