U.S. Department of Labor -- DOL Annual Report, Fiscal Year 2007 - Principal Financial Statements and Notes

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October 24, 2008 DOL Home > About DOL > 2007 PAR > Principal Financial Statements

DOL Annual Report, Fiscal Year 2007
Performance and Accountability Report

Principal Financial Statements and Notes

NOTE 18 - STATUS OF BUDGETARY RESOURCES

A. Apportionment Categories of Obligations Incurred

Obligations incurred reported on the Combined Statement of Budgetary Resources in 2007 and 2006 consisted of the following:

		2007	2006
(Dollars in thousands)
Direct Obligations
	Category A	$4,121,138	$,063,611
	Category B	9,068,443	9,247,270
	Exempt from apportionment	38,830,490	37,033,486
Total direct obligations		52,020,071	50,344,367
Reimbursable Obligations
	Category A	194,918	188,504
	Category B	2,689,784	2,906,630
Total reimbursable obligations		2,884,702	3,095,134
		$54,904,773	$53,439,501

B. Permanent Indefinite Appropriations

DOL’s permanent indefinite appropriations include all trust funds, the Federal Employees’ Compensation Act Special Benefit Fund, the Panama Canal Commission Compensation Fund, the Energy Employees Occupational Illness Compensation Fund, ETA and ESA H-1B funds, and portions of State Unemployment Insurance and Employment Service Operations and Federal Unemployment Benefits and Allowances. These funds are described in Note 1-A.3.

C. Legal Arrangements Affecting Use of Unobligated Balances

Unemployment Trust Fund receipts are reported as budget authority in the Combined Statement of Budgetary Resources. The portion of UTF receipts collected in the current year in excess of amounts needed to pay benefits and other valid obligations are precluded by law from being available for obligation. Therefore, these excess receipts are not classified as budgetary resources in the Combined Statement of Budgetary Resources. Current year excess receipts are reported as temporarily not available pursuant to Public Law. Conversely, when obligations exceed receipts in the current year, amounts are drawn from unavailable collections to meet these obligations. Cumulative excess receipts are not included in unobligated balances in the status of budgetary resources included in that Statement. All excess receipts are reported as assets of the UTF and are included in the Consolidated Balance Sheet. They will become available for obligation as needed in the future.

The cumulative amounts of excess UTF receipts are denoted as unavailable collections in the Budget of the United States Government. The cumulative amount of these excess receipts at September 30, 2007 and 2006 reclassified from unobligated balances to UTF unavailable collections is presented on the following page.

		2007	2006
(Dollars in millions)
Unemployment Trust Fund unavailable collections, beginning		$63,995	$52,213
	Budget authority from current year appropriations	44,909	46,725
	Less obligations	(36,456)	(34,943)
Excess of budget authority over obligations		8,453	11,782
Unemployment Trust Fund unavailable collections, ending		$72,448	$63,995

D. Explanation of Differences between the Combined Statement of Budgetary Resources and the Budget of the United States Government

The Budget of the United States Government with actual amounts for the year ended September 30, 2007 has not been published as of the issue date of these financial statements. This document will be available in February 2008. In addition, the reconciliation of the SF133 and the Combined Statement of Budgetary Resources will be performed in Fiscal Year 2008 after the Department receives the final SF133 reports from Trust Funds and allocated accounts.

A reconciliation of budgetary resources, obligations incurred and outlays, as presented in the Combined Statement of Budgetary Resources, to amounts included in the Budget of the United States Government for the year ended September 30, 2006 is shown below.

		Budgetary Resources	Obligations Incurred	Gross Outlays
(Dollars in millions)
Combined Statement of Budgetary Resources		$57,636	$53,440	$53,502
	Pension Benefit Guaranty Corporation reported separately	19,405	4,438	4,444
	Accruals not reported in the budget	(145)	(145)	-
	Amounts in the budget not included in the Combined Statement of Budgetary Resources	146	131	134
	Amounts in the Combined Statement of Budgetary Resources not included in the budget	-	-	(24)
	Expired accounts	(1,310)	(88)	-
	Other	12	13	15
Budget of the United States Government		$75,744	$57,789	$58,071

E. Undelivered Orders

Undelivered orders at September 30, 2007 and 2006 were as follows.

	2007	2006
(Dollars in thousands)
Undelivered orders	$5,678,989	$5,773,816

F. Appropriations Received

The Combined Statements of Budgetary Resources discloses appropriations received of $56,922 and $58,971 million for FY 2007 and 2006, respectively. Appropriations received on the Consolidated Statements of Changes in Net Position are $11,007 and $10,704 million for FY 2007 and 2006, respectively. The differences of $45,915 and $48,267 million represent certain dedicated and earmarked receipts recognized as exchange revenue or non-exchange revenue reported on the Consolidated Statements of Net Cost or the Consolidated Statements of Changes in Net Position.

NOTE 19 — RECONCILIATION OF BUDGETARY RESOURCES OBLIGATED TO NET COST OF OPERATIONS

			2007	2006
(Dollars in thousands)
Resources used to finance activities
	Budgetary resources obligated
		Obligations incurred	$54,904,773	$53,439,501
		Recoveries of prior year obligations	(220,673)	(399,780)
		Less spending authority from offsetting collections	(6,447,616)	(6,740,047)
		Obligations, net of offsetting collections and recoveries	48,236,484	46,299,674
	Other resources
		Imputed financing from costs absorbed by others	129,859	122,782
		Transfers, net	2,469	1,328
		Exchange revenue not in budget	(784,278)	(929,202)
Total resources used to finance activities			47,584,534	45,494,582
Resources used to finance items not part of the net cost of operations
	Change in budgetary resources obligated for goods, services and benefits ordered but not yet received or provided		108,524	139,777
	Resources that finance the acquisition of assets		(129,596)	(116,035)
	Allocation transfers to other agencies		-	(159,098)
	Other resources that do not affect net cost of operations		-	209
Total resources used to finance items not part of the net cost of operations			(21,072)	(135,147)
Total resources used to finance the net cost of operations			47,563,462	45,359,435
Components of the net cost of operations that will not require or generate resources in the current period
	Components requiring or generating resources in other periods
		Increase in annual leave liability	3,735	2,670
		Increase (decrease) in employee benefits liabilities	633,248	(518,152)
		Other	24,250	(26,068)
	Total		661,233	(541,550)
	Components not requiring or generating resources
		Depreciation and amortization	61,233	55,449
		Revaluation of assets and liabilities	461,967	612,558
		Benefit overpayments	(457,176)	(611,863)
	Total		66,024	56,144
Total components of the net cost of operations that will not require or generate resources in the current period			727,257	(485,406)
Net cost of operations			$48,290,719	$44,874,029

NOTE 20 — SOURCES OF CUSTODIAL REVENUE

Custodial revenues in 2007 consisted of the following:

		Cash Collections	Less Refunds	Net Cash Collections	Increase (Decrease) in Amounts to be Collected	Total Revenues
(Dollars in thousands)
Civil monetary penalties
	OSHA	$65,660	$(233)	$65,427	$1,161	$66,588
	MSHA	30,357	-	30,357	(1,330)	29,027
	EBSA	24,168	-	24,168	3,511	27,679
	ESA	11,689	-	11,689	395	12,084
		131,874	(233)	131,641	3,737	135,378
ETA disallowed grant costs		4,670	-	4,670	11,377	16,047
Other		2,676	(2)	2,674	-	2,674
		$139,220	$(235)	$138,985	$15,114	$154,099

Custodial revenues in 2006 consisted of the following:

		Cash Collections	Less Refunds	Net Cash Collections	Increase (Decrease) in Amounts to be Collected	Total Revenues
(Dollars in thousands)
Civil monetary penalties
	OSHA	$80,119	$(8)	$80,111	$(12,396)	$67,715
	MSHA	24,411	-	24,411	(565)	23,846
	EBSA	15,751	-	15,751	(551)	15,200
	ESA	11,968	(59)	11,909	529	12,438
		132,249	(67)	132,182	(12,983)	119,199
ETA disallowed grant costs		19,815	(2)	19,813	216	20,029
Other		816	(7)	809	-	809
		$152,880	$(76)	$152,804	$(12,767)	$140,037

NOTE 21 — EARMARKED FUNDS

DOL is responsible for the operation of certain earmarked funds. Other earmarked funds include Gifts and Bequests, Panama Canal Commission Compensation Fund, and H-1B Funds. The financial position of the earmarked funds as of September 30, 2007 is shown below.

				Unemployment	Black Lung Disability	Other	Total
(Dollars in thousands)
Assets
	Intra-governmental
		Funds with U.S. Treasury		$103,124	$40,359	$419,245	$562,728
		Investments		74,923,280	-	78,228	75,001,508
		Interest receivable from investments		881,498	-	1,833	883,331
		Accounts receivable, net
			Due from other Federal agencies
			for UCX and UCFE benefits	302,912	-	-	302,912
	Total intra-governmental			76,210,814	40,359	499,306	76,750,479
	Accounts receivable, net
		State unemployment tax		276,072	-	-	276,072
		Due from reimbursable employers		459,192	-	-	459,192
		Benefit overpayments		209,807	10,056	-	219,863
		Other		-	-	2	2
	Advances			509,848	-	379	510,227
	Other			-	-	39	39
Total assets				$77,665,733	$50,415	$499,726	$78,215,874
Liabilities
	Intra-governmental
		Accounts payable to DOL agencies		$1,242,806	$-	$-	$1,242,806
		Advances from U.S. Treasury		-	10,057,557	-	10,057,557
		Amounts held for the Railroad
		Retirement Board		108,990	-	-	108,990
		Other		-	-	7,857	7,857
	Total intra-governmental			1,351,796	10,057,557	7,857	11,417,210
	Accounts payable			-	-	26,041	26,041
	Accrued benefits			1,311,599	20,559	-	1,332,158
	Future workers' compensation benefits			-	-	51,629	51,629
	Other			-	-	655	655
Total liabilities				2,663,395	10,078,116	86,182	12,827,693
Net position
	Cumulative results of operations			75,002,338	(10,027,701)	413,544	65,388,181
Total liabilities and net position				$77,665,733	$50,415	$499,726	$78,215,874

The net results of operations of the earmarked funds for the year ended September 30, 2007 is shown below.

			Unemployment	Black Lung Disability	Other	Total
(Dollars in thousands)
Cost, net of earned revenues
	Benefits		$(32,325,084)	$(285,632)	$(3,139)	$(32,613,855)
	Grants		-	-	(103,179)	(103,179)
	Interest		(3,772)	(717,214)	-	(720,986)
	Administrative		(446,430)	(593)	(19,615)	(466,638)
			(32,775,286)	(1,003,439)	(125,933)	(33,904,658)
	Earned revenue		723,914	-	-	723,914
			(32,051,372)	(1,003,439)	(125,933)	(33,180,744)
Net financing sources
	Taxes		39,271,749	639,197	-	39,910,946
	Interest		3,344,577	463	3,537	3,348,577
	Reimbursement of unemployment benefits		1,632,863	-	-	1,632,863
	Imputed financing		-	-	253	253
	Transfers-in
		Department of Homeland Security	-	-	193,355	193,355
	Transfers-out
		DOL entities	(3,604,321)	(59,179)	-	(3,663,500)
			40,644,868	580,481	197,145	41,422,494
	Net results of operations		8,593,496	(422,958)	71,212	8,241,750
Net position, beginning of period			66,408,842	(9,604,743)	342,332	57,146,431
Net position, end of period			$75,002,338	$(10,027,701)	$413,544	$65,388,181

The financial position of the earmarked funds as of September 30, 2006 is shown below.

				Unemployment	Black Lung Disability	Other	Total
(Dollars in thousands)
Assets
	Intra-governmental
		Funds with U.S. Treasury		$60,257	$39,251	$330,775	$430,283
		Investments		66,212,640	-	80,348	66,292,988
		Interest receivable from investments		743,299	-	2,234	745,533
		Accounts receivable, net
			Due from other Federal agencies
			for UCX and UCFE benefits	335,023	-	-	335,023
	Total intra-governmental			67,351,219	39,251	413,357	67,803,827
	Accounts receivable, net
		State unemployment tax		266,544	-	-	266,544
		Due from reimbursable employers		511,659	-	-	511,659
		Benefit overpayments		183,437	8,800	-	192,237
		Other		-	-	2	2
	Advances			474,153	-	3,525	477,678
	Other			-	-	23	23
Total assets				$68,787,012	$48,051	$416,907	$69,251,970
Liabilities
	Intra-governmental
		Accounts payable to DOL agencies		$1,208,229	$-	$-	$1,208,229
		Advances from U.S. Treasury		-	9,631,557	-	9,631,557
		Amounts held for the Railroad
		Retirement Board		101,514	-	-	101,514
		Other		-	-	7,689	7,689
	Total intra-governmental			1,309,743	9,631,557	7,689	10,948,989
	Accounts payable			-	-	10,654	10,654
	Accrued benefits			1,068,427	21,237	-	1,089,664
	Future workers' compensation benefits			-	-	55,610	55,610
	Other			-	-	622	622
Total liabilities				2,378,170	9,652,794	74,575	12,105,539
Net position
	Cumulative results of operations			66,408,842	(9,604,743)	342,332	57,146,431
Total liabilities and net position				$68,787,012	$48,051	$416,907	$69,251,970

The net results of operations of the earmarked funds for the year ended September 30, 2006 is shown below.

			Unemployment	Black Lung Disability	Other	Total
(Dollars in thousands)
Cost, net of earned revenues
	Benefits		$(31,025,168)	$(299,479)	$(2,051)	$(31,326,698)
	Grants		-	-	(51,388)	(51,388)
	Interest		(3,010)	(694,964)	-	(697,974)
	Administrative		(295,807)	(342)	(15,647)	(311,796)
			(31,323,985)	(994,785)	(69,086)	(32,387,856)
	Earned revenue		818,294	-	-	818,294
			(30,505,691)	(994,785)	(69,086)	(31,569,562)
Net financing sources
	Taxes		41,406,645	607,387	-	42,014,032
	Interest		2,780,114	297	3,647	2,784,058
	Reimbursement of unemployment benefits		1,855,188	-	-	1,855,188
	Imputed financing		-	-	238	238
	Transfers-in
		Department of Homeland Security	-	-	390,823	390,823
	Transfers-out
		DOL entities	(3,623,927)	(57,633)	-	(3,681,560)
			42,418,020	550,051	394,708	43,362,779
	Net results of operations		11,912,329	(444,734)	325,622	11,793,217
Net position, beginning of period			54,496,513	(9,160,009)	16,710	45,353,214
Net position, end of period			$66,408,842	$(9,604,743)	$342,332	$57,146,431

NOTE 22 — DEDICATED COLLECTIONS

The Department administers four trust funds that receive dedicated collections. Statement of Federal Financial Accounting Standards 27, Identifying and Reporting Earmarked Funds, became effective in FY 2006. This standard affected former standards dealing with dedicated collections, and as a result, the Unemployment Trust Fund and the Black Lung Disability Trust Fund were classified as earmarked funds. The financial position of the two remaining trust funds as of September 30, 2007 is shown below.

			Longshore and Harbor Workers' Compensation Act	District of Columbia Workmen's Compensation Act
(Dollars in thousands)
Assets
	Intra-governmental
		Funds with U.S. Treasury	$154	$75
		Investments	69,979	6,585
		Interest receivable from investments	16	1
	Total intra-governmental		70,149	6,661
	Other accounts receivable, net		3,803	327
Total assets			$73,952	$6,988
Liabilities
	Accrued benefits		$3,655	$298
	Other		39,408	2,557
Total liabilities			43,063	2,855
Net position
	Cumulative results of operations		30,889	4,133
Total liabilities and net position			$73,952	$6,988

The net results of operations of each trust fund for the year ended September 30, 2007 is shown below.

			Longshore and Harbor Workers' Compensation Act	District of Columbia Workmen's Compensation Act
(Dollars in thousands)
Cost, net of earned revenues
	Benefits		$(129,040)	$(9,819)
Net financing sources
	Interest		2,077	250
	Assessments		128,934	11,264
	Transfers-out
		DOL entities	(2,042)	-
			128,969	11,514
	Net results of operations		(71)	1,695
Net position, beginning of period			30,960	2,438
Net position, end of period			$30,889	$4,133

The financial position of each trust fund as of September 30, 2006 is shown below.

			Longshore and Harbor Workers' Compensation Act	District of Columbia Workmen's Compensation Act
(Dollars in thousands)
Assets
	Intra-governmental
		Funds with U.S. Treasury	$154	$76
		Investments	73,146	5,611
		Interest receivable from investments	10	1
	Total intra-governmental		73,310	5,688
	Other accounts receivable, net		2,431	412
Total assets			$75,741	$6,100
Liabilities
	Intra-governmental
		Accounts payable to DOL agencies	$2,028	$-
	Accrued benefits		3,382	283
	Other		39,371	3,379
Total liabilities			44,781	3,662
Net position
	Cumulative results of operations		30,960	2,438
Total liabilities and net position			$75,741	$6,100

The net results of operations of each trust fund for the year ended September 30, 2006 is shown below.

			Longshore and Harbor Workers' Compensation Act	District of Columbia Workmen's Compensation Act
(Dollars in thousands)
Cost, net of earned revenues
	Benefits		$(133,694)	$(10,112)
Net financing sources
	Interest		2,016	155
	Assessments		138,857	10,789
	Transfers-out
		DOL entities	(2,028)	-
			138,845	10,944
	Net results of operations		5,151	832
Net position, beginning of period			25,809	1,606
Net position, end of period			$30,960	$2,438

NOTE 23 — BALANCE SHEET CLASSIFICATIONS AGGREGATED TO CONFORM WITH OMB CIRCULAR NO. A-136 CLASSIFICATIONS

The Department’s consolidated balance sheet has different classifications of certain assets and liabilities from those suggested in OMB Circular No. A-136. The following aggregate Department of Labor classifications into OMB Circular No. A-136 classifications.

				2007	2006
(Dollars in thousands)
ASSETS
	Intra-governmental
		Other
			Interest receivable from investments	$883,360	$745,556
			Advances	-	4
		Total other		$883,360	$745,560
	Other
		Advances		$541,565	$555,294
	Total other			$541,565	$555,294
LIABILITIES
	Federal employee and veteran benefits
		Future workers' compensation benefits		$635,848	$548,314
	Total Federal employee and veteran benefits			$635,848	$548,314
	Other
		Energy employees occupational illness
		compensation benefits		$7,501,838	$6,942,442
		Accrued leave		101,257	97,522
		Other liabilities		260,374	217,313
	Total other			$7,863,469	$7,257,277