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Country Report U.S.A.

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. The U.S. - The Basics. Population – 306 million

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Country Report U.S.A.

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  1. Country ReportU.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

  2. 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.

  3. 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 the2nd 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’.

  4. Key Issues • Current Financial Position and Condition • Market Stabilization & Recovery • Social Insurance & Sustainability

  5. A Year of Unprecedented Change

  6. Budget Deficit vs. Net Cost $339b Change in VA estimates $549.8b Change in unfunded postemployment benefit estimates 2008 Unified Budget Deficit $454.8 billion + $110b Change in DoD estimates + $100b Change in OPM estimates $4.5b Net Increase in: Environmental Liabilities; Net Capitalized Fixed Assets; Other $(46.6b) Decrease in Capitalized Fixed Assets, net of Depreciation = 2008 Net Cost $1,009.1 billion $51.1b Other

  7. What Came In & What Went Out In Out

  8. What We Own & What We Owe Liabilities Assets • $1.97 trillion • Mostly Property Plant &Equipment • Other (off-balance sheet) • Stewardship Land (national parks, forests) • Heritage Assets (national memorials, historic structures)

  9. 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.

  10. Transparency Cost / Benefit Accounting for transactions and events Credit Reform. Consolidation Impact of American Recovery and Reinvestment Act (ARRA) Market Stabilization & RecoveryReporting Challenges

  11. Social Insurance: An Issue Now & in the Future Historical & Projected U.S. Debt Held by the Public as % of GDP Historical & Projected U.S. Revenue and Cost as % of GDP • 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.

  12. The Clock is Ticking

  13. 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: • 1. DoD Accounting Issues • Accounting for/Reconciliation of Intragovernmental Activity and Balances • FMS must ‘PLUG’ a “harmonizing” entry (i.e., ‘PLUG’) into the equity reported on the Statement of Changes in Net Position to balance. • Preparation of Consolidated Financial Statements

  14. Major Initiatives Governmentwide Accounting and Reporting Modernization Project (GWA) Financial Information Reporting Standardization (FIRST) Collections and Cash Management Modernization (CCMM) Payment Application Modernization (PAM) Common Governmentwide Accounting Classification (CGAC)

  15. 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 decision-makers. • Build on success of ‘Citizen’s Guide’ • Ready to address the reporting challenges of the economic recovery effort. • Credit Reform • Transparency

  16. 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

  17. ? QUESTIONS

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