NOTE 3. Non-Entity Assets

Non-entity assets consist of amounts held on deposit for the convenience of the USPTO customers and fees collected on behalf of the World Intellectual Property Organization (WIPO) and the European Patent Office (EPO). Customers have the option of maintaining a deposit account at the USPTO to facilitate the order process. Customers can draw from their deposit account when they place an order and can replenish their deposit account as desired. Funds maintained in customer deposit accounts are not available for the USPTO use until an order has been placed. Once an order has been placed, the funds are reclassified to entity funds. Also, in accordance with the Patent Cooperation Treaty and the Madrid Protocol Implementation Act, the USPTO collects international fees on behalf of the WIPO and the EPO.

Non-Entity Fund Balance with Treasury as of September 30, 2006 and 2005 (Dollars in Thousands) 2006 2005 Fund Balance with Treasury:     Intragovernmental Deposit Accounts $ 4,498 $ 4,230 Other Customer Deposit Accounts  78,224  69,092 Patent Cooperation Treaty Account   8,158   8,248 Madrid Protocol Account     279     334 Total Fund Balance with Treasury  91,159  81,904 Cash:     Patent Cooperation Treaty Account     542     787 Accounts Receivable:     Other Customer Deposit Accounts   1,085     752 Patent Cooperation Treaty Account      46       — Total Non-Entity Assets $92,832 $83,443

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