Version 7 section

• brief discussion
Public Financial Management
Control and Security in the Age of
Transparency

SEGURINFO Uruguay 2011

trust

3
 Version 7 section
transparency

• brief discussion
 Version 7 section
strategic openness

• brief discussion

5
 Version 7 section
trust but verify

• brief discussion
Strengthening Public Financial Management through
Transparency in Timor-Leste
 Version 7 section
Who is FreeBalance?
Version 7 section
FreeBalance is a global provider of Government
Resource Planning (GRP) software for public financial
management (PFM)
• brief discussion
• Canadian software company ISO-9001/2008 certified
• For Profit Social Enterprise
• 100% focus on government
• Global presence, implemented in 19 countries in North
America, Latin America, Caribbean, Africa, Middle
East, and Asia/Pacific
• From post-conflict through G8
 Version 7 section
FORCES

• brief discussion

9
 Version 7 section
globalization

• brief discussion

10
 Version 7 section
transparency

• brief discussion

11
 Version 7 section
citizen services

• brief discussion

12
 Version 7 section
international assessment

• brief discussion

13
 Version 7 section
governance

• brief discussion

14
 Version 7 section

• brief discussion

corruption

15
Government Expenditures as a % of GDP
2006: Non OECD Countries
 Version 7 section
Democratic
• brief discussion Republic of
Timor-Leste
(RDTL)
Objectives
build civil society
build infrastructure
build capacity
build citizen involvement
in government
 3

AUSTRALIA
HIGH
Benefits of Transparency
2 Government Effectiveness and GDP*
Normalized Government Effectiveness Index

PAPUA NEW GUINEA

UGANDA

-1

Higher the government effectiveness

-2 = higher the country GDP Per Capita

LOW
209 Countries
-3 GDP Per Capita (PPP, logs)

Source: The World

Bank
* At purchasing power parity
 3

HIGH Benefits of Transparency

AUSTRALIA
2
Voice and Accountability and GDP*
Normalized Voice and Accountability Index

PAPUA NEW GUINEA

1
UGANDA

-1

Higher the government

-2 accountability = higher the country
GDP Per Capita
LOW 207 Countries
.
-3 Source: The World GDP Per Capita (PPP, logs)
Bank
* At purchasing power parity
 3

AUSTRALIA
HIGH
Benefits of Transparency
2 Control of Corruption and GDP*
Normalized Control of Corruption Index

PAPUA NEW GUINEA

0
UGANDA

-1

Higher the control of corruption

= higher the country GDP Per
-2
Capita
LOW
204 Countries
-3
Source: The World GDP Per Capita (PPP, logs)
Bank
* At purchasing power parity
 Version 7 section
= stability

• brief discussion
 Version 7 section

• brief discussion

= investor confidence
 Version 7 section

avoid
• brief discussion
the
resource curse
 Version 7 section
problem

• brief discussion

28
 Version 7 section
transparency - corruption

• brief discussion
 Version 7 section
controls - corruption

• brief discussion
 Version 7 section

• brief discussion controls

transparency

31
 Version 7 section
1. Strategic Transparency

• brief discussion
 Version 7 section
1.1. International Standards

• brief discussion
 Version 7 section

• brief discussion
IPSAS
International Public Sector Accounting
Standards
 Version 7 section

• brief discussion

EITI
Extractive Industries Transparency
Initiative
 VersionGFS
7 section
Government Financial Statistics
• brief discussion
 Version 7 sectionMTEF
Medium Term
Expenditure
• brief discussion Frameworks
 Version 7 section
1.2 e-Procurement Portal

• brief discussion
 review
Version 7 section

• brief discussion

vendor
government alerts
tenders
published

tender
results
published
39
 Version 7 section
1.3. Transparency Portal

• brief discussion
 review
Version 7 section
http://www.transparency.gov.tl

• brief discussion
10 years of
budget &
financial data drill down
through the
chart of
output in accounts
RTF, Word,
Excel, PDF,
Text, XML,
HTML
41
 Version 7 section

• brief discussion

2. Internal Controls
 Version 7 section
2.1 Hierarchical Controls
Version 7 section

• brief of
• Chart discussion
Accounts (COA) is key
within governments. Key control
needs include:
• Hierarchical – organizational,
functional, project, budgetary
• Multi-dimensional data access

43
 Version 7 section
2.2 Reporting
Version 7 section

• brief discussion reporting

• Sophisticated
• Pro-active monitoring
• Administrative and compliance
needs

44
 Version 7 section
2.3Version
Multiple Controls
7 section

Multiple
• brief controls
discussion for the same activity
or function
 Version 7 section

• brief discussion

3. Audit
 Version 7 section
3.1 Activity
Version 7 section
• Same activity can
• brief discussion
vary within
government ministries, departments
and agencies (MDAs)
• Audit workflow based rules and
procedures for conformity
 Version 7 section
3.2 Roles
Version 7 section
• Roles and responsibilities
• brief discussion
• Separation of duties
 Version 7 section
3.3 Traceability
Version 7 section
• Non-
• brief discussion
repudiation
of data
 Version 7 section

• brief discussion

4. System Security
 Version 7 section
Paper
Version 7 section

• brief discussion

Physical Security- Lock and Key

Authentication – Wax Seals and
Stamp
 Version 7 section
Mainframes

Physical Security- Lock and Key
• brief discussion

Authentication – User ID and Password
 Version
Network7 Security
section

•
Identity
brief discussion
Management

Encryption

High Availability
 Version 7 section
Internet
Version 7 section

• brief discussion

Internal and External Site

Firewalls

Virtual Private Network (VPN)

Secure Socket Layer
 Version 7 section
Cloud
Version 7 section

• brief discussion

Data Access Security

Identity Management

Regulatory Compliance

Data Segregation
 Version 7 section
Security Details

• brief discussion

56
 Version 7 section
Data Security
• Protect vital Government Data
• brief discussion
• Multiple layers of Encryption
– Data
– Traffic
– Access
 Version 7 section
Data Access Security
• Data-based filtering system
• Configurable
• brief discussion
• Standalone
• Non-intrusive
• Works jointly with Functional Classes
Data Access Security
• Resides between the Business Logic Layer and
the Client Side.

DB DAL BLL

User DAS
 Version 7 section
Security Dimension Types
• Chart of Accounts Restriction
• Hierarchical Domain
• brief discussion
• Domain Restriction
• Literal Restriction
 Version 7 section
Secure Scripting
– Support for server and client-side validation.
• briefaccess
– Strong discussion
control.
– Obfuscation of JavaScript enhances client-side
security
– Stripping of comments and whitespace
– Industry standard SSL technology
 Version 7 section

• brief discussion
5. Security Advantages of Open
Source Middleware

62
 Open Source Middleware
• Who are the most vocal proponents of open
source middleware software in the American
government?
• Answer: Department of Defense and Central
Intelligence Agency
• Why?
• Answer: Because they can examine the source
code of the middleware.
• FreeBalance software is not open source so no
one can examine your source code.
 Conclusions

• You can’t stop transparency

• Can have transparency and security
together
• Public Financial Management and
Governance focus
• Electronic funds transfers reduces
corruption opportunity