This approach offers federal agencies a means to  buy services more quickly and possibly at a lower cost than building,  operating, and maintaining these computing resources themselves. In 2012, OMB began requiring agencies to report associated cloud  spending, as called for in its annual capital planning guidance. Most of the Selected Agencies Reported Making Progress in Implementing Cloud Services

The16 selected agencies reported making progress in implementing  cloud services—namely, they established guidance for assessing  investments for cloud services, performed those assessments, and  implemented cloud services for their investments. However, the extent of  these agencies’ progress varied. In addition, while these  agencies had assessed the majority of their investments for cloud  services planned for fiscal year 2019, 12 agencies had not completed an  assessment of 10 or more IT investments for cloud services. However, the remaining six agencies did not have such comprehensive  guidance in place. In addition, while the majority of agencies made progress in implementing  cloud services between fiscal years 2016 and 2019, the extent of  agencies’ progress varied. Agencies Have Increased Spending and Realized Savings from Using Cloud Services, but Spending and Savings Figures Are Underreported

The 16 agencies in our review made progress in implementing cloud  services. (For  a list of the investments that have spent $1 million or more in life-cycle  costs for cloud services, provided by each of the 16 selected agencies for  fiscal year 2018, see appendix V.)
Officials in the Office of the CIO at all of the agencies in our review  identified three factors that could affect the completeness of the cloud  spending data provided to us and on the IT Dashboard: (1) spending data  were not consistently tracked; (2) different methods were used to  calculate cloud spending costs; and (3) interpreting changes in OMB and  related guidance created confusion regarding what spending data should  be tracked. As a result, agencies’ reported cloud savings data  on the IT Dashboard and the data provided to us is likely underreported. In addition, OMB staff  confirmed that agencies do not have to specifically identify savings  related to cloud computing unless they choose to do so. Selected Agencies Have Realized Benefits from Cloud Services

Officials from 15 of the 16 agencies in our review reported that they had  realized several significant benefits from the adoption of cloud services,  ranging from improvements in the delivery of IT services to increasing the  efficiency of operations and systems. Cloud Services Aid with IT Efficiency, Cost Savings, and System Modernization

Officials in charge of cloud services at 15 of the 16 agencies in our review  reported that they had identified five significant or notable benefits as a  result of acquiring cloud services. Recommendations for Executive Action

We are making a total of 35 recommendations—1 recommendation to  OMB and 34 recommendations to the 16 agencies in our review. The Director of the Office of Management and Budget should require  agencies to explicitly report, at least on a quarterly basis, the savings and  cost avoidance associated with cloud computing investments. One agency agreed with one recommendation and disagreed with a  second recommendation:
Defense provided written comments in which it agreed with our  recommendation to complete an assessment of all IT investments for  suitability for migration to a cloud computing service. We requested that these agencies provide spending and  savings data broken down by investment, as OMB only requires federal  agencies to report total spending by cloud deployment model on the IT  Dashboard, and agencies were not required to identify whether any  reported savings were cloud-related. Fifteen  of the 16 agencies in our review identified at least one or more examples  of cloud investments that had produced significant or notable benefits,  while one agency—HHS—reported that it did not have any such  examples because it did not have any completed migration efforts. Consolidating website access to benefits and services and  incorporating veterans’ feedback improved customer service to  veterans and reduced costs. DHS’s Cloud Acquisition Supports Information Sharing and Collaboration

The Department of Homeland Security (DHS) collaborates with a variety  of agencies and organizations to share information related to homeland  security.
Why GAO Did This Study

Cloud computing enables on-demand access to shared computing resources providing services more quickly and at a lower cost than having agencies maintain these resources themselves. In 2012, OMB began requiring agencies to assess all IT investments for cloud services.
GAO was asked to review agencies' reported use of cloud services. This report discusses selected agencies' progress in implementing cloud services, the extent to which those agencies increased cloud service spending and achieved savings or cost avoidances, and examples of agency-reported cloud investments with notable benefits. GAO selected 16 agencies to review based on their fiscal year 2017 IT budgets and analyzed their use of cloud services, associated spending and savings data, and guidance for assessing investments for these services. GAO interviewed agency officials in charge of cloud services and reviewed pertinent documents to identify acquisitions with notable benefits. GAO also interviewed OMB staff about their agency's role in federal cloud computing and related OMB guidance.

What GAO Found

The 16 agencies GAO reviewed made progress in implementing cloud computing services (cloud services)—namely, they established assessment guidance, performed assessments, and implemented these services—but the extent of their progress varied. To encourage cloud service acquisition, the Office of Management and Budget (OMB) began requiring agencies to assess all information technology (IT) investments for cloud services. However, only 10 of the 16 agencies reviewed had established assessment guidance. In addition, while the agencies assessed the majority of their planned fiscal year 2019 IT investments for cloud services, 12 agencies had not completed an assessment of 10 or more investments. Nevertheless, 10 of the agencies reported increasing their use of cloud services between fiscal years 2016 through 2019 (see figure). Six agencies noted that inconsistent reporting of cloud investments and investment consolidation impacted their reported percentage.
Further, the 16 agencies reported that they had increased their cloud service spending since 2015 and 13 of the 16 agencies had saved $291 million to date from these services. However, these agencies identified issues in tracking and reporting cloud spending and savings data, including not having consistent processes in place to do so. Agencies also noted that OMB guidance did not require them to explicitly report savings from cloud implementations and, therefore, they had to specifically collect this data to meet GAO's request. As a result of these identified issues, it is likely that agency-reported cloud spending and savings figures were underreported.
Officials from 15 of the 16 agencies reported that they had identified significant benefits from acquiring cloud services, including improved customer service and the acquisition of more cost-effective options for managing IT services. In addition, these agencies identified nine cloud investments that, among other things, enhanced the availability of weather-related information, facilitated collaboration and information sharing among federal, state, and local agencies related to homeland security, and provided benefits information to veterans, as examples of systems that realized these benefits. One agency reported that it had not realized benefits because it did not have any completed migration efforts.

What GAO Recommends

GAO is making one recommendation to OMB on cloud savings reporting, and 34 recommendations to the 16 agencies on cloud assessments and savings. Fourteen agencies agreed with all recommendations, OMB and one agency neither agreed nor disagreed, and one (Defense) agreed with one recommendation but not the other. GAO continues to believe its recommendation to the department is appropriate.