Survey
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
* Your assessment is very important for improving the workof artificial intelligence, which forms the content of this project
Country Report U.S.A. Public Sector Accruals Symposium Organization of Economic Cooperation & Development March 3-4, 2009 Nancy Fleetwood United States of America, Department of the Treasury Deputy Assistant Secretary – Accounting Policy 1 The U.S. - The Basics Population – 306 million 2009 Outlays: $3.1t; Receipts: $2.7t • Unified Budget Deficit: $455b • Net Cost: $1t National Debt (as of 9/30/08): $10t • Public Debt:$5.8t • Intragovernmental: $4.2t Hundreds of agencies. • 35 Reporting entity agencies Fiscal Year: October 1 – September 30 Audit opinion disclaimer for more than a decade. 2 FY 2008 Accomplishments For the 4th year in a row, all CFO Act agencies completed their audits within 45 days of fiscal year-end (November 15th). • 21/24 major Federal agencies received clean audit opinions, (FY07 - 19) • For the 5th consecutive year, the total number of material weaknesses government-wide declined (from 39 to 32 during FY 2008). • 14 agencies earned a clean audit opinion with no material weaknesses (including the Departments of Commerce, Education, Energy, HUD, Justice, Labor, State, and Transportation). The Government issued its consolidated financial report on time by December 15th. For the 2nd consecutive year, the Government: • earned an unqualified audit opinion on its Statement of Social Insurance. • issued a ‘Citizen’s Guide’ to the Financial Report of the U.S. Government’. 3 Key Issues Current Financial Position and Condition Market Stabilization & Recovery Social Insurance & Sustainability 4 A Year of Unprecedented Change 5 Budget Deficit vs. Net Cost $339b 2008 Unified Budget Deficit $454.8 billion + $549.8b Change in VA estimates Change in unfunded postemployment benefit estimates $110b Change in DoD estimates + $100b $4.5b Change in OPM estimates Net Increase in: Environmental Liabilities; Net Capitalized Fixed Assets; Other $(46.6b) Decrease in Capitalized Fixed Assets, net of Depreciation = $51.1b Other 2008 Net Cost $1,009.1 billion 6 What Came In & What Went Out In Out 7 What We Own & What We Owe Assets $6,000.0 $5,000.0 Environmental & disposal liabilities $4,000.0 $3,000.0 Fed employee & veteran benefits payable $2,000.0 $1,000.0 20 08 20 07 $20 06 • Stewardship Land (national parks, forests) • Heritage Assets (national memorials, historic structures) Other Liabilities 20 05 Liabilities by Type 20 04 $1.97 trillion Mostly Property Plant &Equipment Other (off-balance sheet) Dollars in Billions Liabilities Federal debt securities held by the public 8 Market Stabilization & Recovery Housing & Economic Recovery Act (HERA) Emergency Economic Stabilization Act (EESA) Troubled Assets Relief Program (TARP) American Recovery and Reinvestment Act (ARRA) Only a small fraction of activity impacted the FY 2008 statements. Transactions impacting the FY 2008 financial statements Investment: preferred stock warrants from Government Sponsored Enterprises (GSEs) Supplementary Financing Program: Treasury borrows $300b and deposits with Federal Reserve. Keepwell' liability to Freddie Mac Loan Receivable - MBS purchase Dollars in Billions Assets Liabilities $ 7.0 $ 300.0 $ 300.0 $ $ 13.8 3.3 9 Market Stabilization & Recovery Reporting Challenges Transparency • Cost / Benefit Accounting for transactions and events • Credit Reform. • Consolidation Impact of American Recovery and Reinvestment Act (ARRA) 10 Social Insurance: An Issue Now & in the Future Historical & Projected U.S. Revenue and Cost as % of GDP Historical & Projected U.S. Debt Held by the Public as % of GDP Current Trends Are Not Sustainable Debt held by the Public (as a percent of GDP) (as a percent of GDP) 700 70.0 Net Interest 600 Other Government Percent of GDP 50.0 Medicaid 40.0 Medicare 30.0 500 400 300 20.0 Social Security 200 10.0 Total Revenues 100 19 70 19 80 19 90 20 00 20 10 20 20 20 30 20 40 20 50 20 60 20 70 20 80 --- Percent of GDP 60.0 WWII 109% of GDP 0 1940 1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050 2060 2070 2080 Under current conditions, actuaries estimate that there will be a social insurance shortfall of $43t. • 75-year estimate of future benefit expenditures net of contributions. 11 The Clock is Ticking 12 We Still Have Work To Do For the 12th Consecutive Year, GAO issued a disclaimer of opinion on the Financial Report of the U.S. Government. Material Weaknesses: 'Harmonizing Entries': 2003-2008 $30.0 2. Accounting for/Reconciliation of Intragovernmental Activity and Balances $20.0 • FMS must ‘PLUG’ a “harmonizing” entry (i.e., ‘PLUG’) into the equity reported on the Statement of Changes in Net Position to balance. 3. Preparation of Consolidated Financial Statements billions of dollars 1. DoD Accounting Issues $24.5 $10.0 $11.0 $6.7 $4.1 $- $(3.4) 2003 2004 2005 2006 2007 2008 $(10.0) $(29.8) $(20.0) $(30.0) Fiscal Year 'PLUG' 13 Major Initiatives Governmentwide Accounting and Reporting Modernization Project (GWA) Collections and Cash Management Modernization (CCMM) Financial Information Reporting Standardization (FIRST) Payment Application Modernization (PAM) Common Governmentwide Accounting Classification (CGAC) 14 On the Horizon We must have a clean audit opinion on the Governmentwide financial statements. • Continue to build on agency audit successes. • Continue to pursue systems and structure initiatives to resolve governmentwide material weaknesses. Financial reporting needs to be relevant to decisionmakers. • Build on success of ‘Citizen’s Guide’ Ready to address the reporting challenges of the economic recovery effort. • Credit Reform • Transparency 15 Find Out More U.S. Department of the Treasury http://www.fms.treas.gov/fr/index.html Office of Management and Budget http://www.whitehouse.gov/omb/financial/reports/fy08_5yr_plan.pdf Government Accountability Office http://www.gao.gov/financial/fy2008financialreport.html Federal Accounting Standards Advisory Board www.fasab.gov 16 QUESTIONS 17