1. The FY 2017 Financial Report of the U.S. Government Part II
R. Scott Bell
Senior Staff Accountant
Department of the Treasury .
AGA - New Mexico
April 5, 2018

2. Quote from then President Thomas Jefferson to his Treasury Secretary, Albert Gallatin more than 200 years ago. Guiding principle behind the Citizen’s Guide.

3. Agency Financial Reports Performance & Accountability Reports
39 Significant Reporting Entities
115 Other Reporting Entities
Audited By Inspectors General & Contract Auditors
Audits Report &
Financial Statements
“How the Sausage is Made”
September 30 – Fiscal Year End
November 15 – agencies
February 15 – Governmentwide
GAO – auditor
OMB – collaborator (Treasury, in consultation with OMB…) prepares certain parts of report.
Fiscal Projections
Analysis & Summary

4. Recap - “Traditional” Reporting
This slide compares the Government’s budget deficit (cash basis of accounting) and net operating cost (accrual basis). Complementary perspectives of what the Government has earned/received and spent. (accrual includes revenues earned but not necessarily received; and costs incurred but not necessarily spent).

5. Financial Report of the U.S. Government
FRUSG: Then & Now
Financial Report of the U.S. Government
Selected Data
1997
2017
Budget Deficit
$15 b
$665.7b
Tax and Other Revenue
$1.6 t
$3.4 t
Net Operating Cost
$21 b
$1.2 t
Total Assets
$3.5 t
Public Debt + Accd Int
$3.8 t
$14.7 t
Total Liabilities
$6.6 t
$23.9 t
Social Insurance Net Expenditures
$1.8 t*
$49.0 t
Comparison of key financial line items from the first Financial Report to this past year.
*Required Supplementary Stewardship Information
Unmodified Audit Opinion? No

6. “Non-Traditional” Reporting Social Insurance
Statement of Social Insurance shows the net present value of projected expenditures and revenues over 75 years (consistent with trustees reports).
These amounts do not meet the definition of a liability according to federal accounting rules, but the Government is required to report on them in a separate statement (Statement of Social Insurance).

7. “Non-Traditional” Reporting Trust Fund Status
Statement of Social Insurance shows the net present value of projected expenditures and revenues over 75 years (consistent with trustees reports).
These amounts do not meet the definition of a liability according to federal accounting rules, but the Government is required to report on them in a separate statement (Statement of Social Insurance).

8. Projected revenues and spending are impacted in the long-run by:
The retirement of the baby boom generation
B) Rising health care costs
C) Longevity and birth rates
D) A, B, and C
E) None of the above
Correct Answer: D

9. Long-Term Fiscal Projections
“Non-Traditional” Reporting
Long-Term Fiscal Projections
Similar to the Statement of Social Insurance, Statement of Long-Term Fiscal Projections shows NPV of 75-year projections for all government revenues and non-interest spending.
Net is substantially different due to the fact that for non-social insurance programs, the amount of general tax revenue outpaces amount of spending.

10. Fiscal Sustainability
Sustainability Definition:
Debt/GDP remains stable/declines over the long term.
Key Assumptions:
Current Law & Policy
75-Year Projections = Uncertainty
Projections, NOT Predictions.
*UNCERTAINTY
These charts show historical and projected trends in receipts, non-interest spending, and debt as a percent of GDP.
This “fiscal sustainability” analysis is prepared and provided for the Report by OMB.
Key assumptions are that the trends are modeled according to current law and policy – they do not anticipate changes in future law, policy, or conditions, although that very well may happen.
Consequently, these are considered projections, or mathematical extrapolations of current trends – NOT predictions.
Also important to note that with 5, 10, and 20 year projections, much less 75-year projections, there is a lot of uncertainty.
That said…next slide…

11. The federal government’s fiscal path could be described as:
Sustainable
B) Unsustainable
C) Impossible
D) Unchangeable
Correct Answer – B – the Financial Report has reported this conclusion for several years across multiple administrations – the projected trend in debt/GDP from the previous slide – reaching beyond 150 and 200 percent in the outyears is not sustainable.
However, the Report also says that the sooner we put policy measures in place to avert these trends, the less dramatic those changes will need to be.

12. Historical and Projected Trends - Debt as Percent of GDP
FY 2007
While the current projections may seem a bit daunting, it is important to:
Remember that we are dealing with 75-year projections that convey a great amount of uncertainty; and
That we have some stability in the short-term that impact the long-term projections. Compare the slope of the projections in the FY 2017 report to the debt/GDP projection trend line from the first year we reported this information – in FY The slope has significantly decreased over the past decade.

13. “Non-Traditional” Reporting
Fiscal Gap
Reduction of primary deficits over 75 years to to keep/make fiscal policy sustainable.
Keep Debt/GDP at current level (76%).
Some combination of revenue/spending changes.
Longer delay = bigger changes needed.
Statement of Social Insurance shows the net present value of projected expenditures and revenues over 75 years (consistent with trustees reports).
These amounts do not meet the definition of a liability according to federal accounting rules, but the Government is required to report on them in a separate statement (Statement of Social Insurance).

14. One-Stop shop for information from Report presented in Executive Summary.

15. “To state the facts frankly is not to despair the future nor indict the past. The prudent heir takes careful inventory of his legacies and gives a faithful accounting to those whom he owes an obligation of trust.”
- John F. Kennedy
Purpose of this presentation is not to have you despair the future nor indict the past, but to provide information about the Government’s financial position and condition so as to make you, the general public, more informed about how your Government is performing and the challenges that it faces.

16. Loans and Other Financial Assistance
DATA Act Overview
Goal
Track $3.8 trillion dollars in annual spending on a quarterly basis and link data from the budget, accounting, procurement and financial assistance databases into one common format
Challenge
Collect, store, and display more than data elements from over 100 federal agencies
Procurements
and
Contracts
Grants
$3.8
Trillion in
Federal
Spending
Loans and Other Financial Assistance
Other
Agency Expenditures
Better Data. Better Decisions. Better Government

17. DATA Act Challenges & Benefits
Large, Intricate Data Sets
Improved Data Quality
Lack of data standards, multiple stakeholders managing different data sets, multiple vendor solutions
Increase access to searchable and reliable Federal spending data
Strict Mandated Timelines
Better Oversight
Short, legislatively-mandated timelines outlined in the law
Encourage better tracking of how the Federal government spends funds
Data–Centric Decision Making
One-Size Fits All Approach
Requirements and solutions must work for federal agencies
Promote data–driven decision making due to access of reliable agency data
Diverse Data Users
Research and Innovation
Federal agencies, journalist, oversight bodies, industry, state/local governments, and the public
Promote research and innovation both inside and outside of government

18. usaspending.gov Homepage
The website is built to tell the story of federal spending. Upon accessing the site, the highest level of spending is presented showing that the government spent (outlayed) $3.98 trillion. (This figure is derived from internal Treasury systems.) Scrolling further down the homepage, user’s are given an overview of the website’s functionality (i.e., Spending Explorer, Award Search, Profiles and the Download Center).
NOTE: This is the home page of the beta site. In March, Treasury is tentatively planning to move the beta website into production. The current production site will be accessible for two weeks via a different URL.

19. usaspending.gov Homepage
(Continued)
The beta website includes the DATA Act financial data that was previously unavailable on the legacy site. The Spending Explorer function allows the user to explore this new data and its relationship to the pre-existing award data. After clicking on the Spending Explorer link, the user is given three options to explore fiscal year 2018 spending. The user can explore by (1) Budget Function, (2) Agency and (3) Object Class.
For those who report via DATA Act requires, this functionality derives data submitted using Files A and B. Linkages between the financial and award data are maintained in File C.
As we walk through the remainder of the slides, we will leverage the Spending Explorer > Agency to explore US Department of Agriculture spend.

20. Spending Explorer (By Agency)
After clicking on the Spending Explorer > Agency option, and drilling into USDA’s data we see a breakdown of their federal accounts. This screens also shows that USDA has a FY2018 obligated amount of $50.7B as of December 31, The website allows user’s to hover over the different Federal Accounts to gain more insight including its (obligated) Total Amount and the Percent relative to all Federal Accounts within USDA.
As you can see, the Child Nutrition Programs has an obligated Total Amount of $6.3B which is 12.4% of all Federal Account incurring obligations as of December 31, Clicking on the “Child Nutrition Programs, Food Nutrition Service, Agriculture” Federal Account allows the user to drill-down further into Program Activities within the Federal Account. However, we are going to further explore the “Child Nutrition Programs, Food Nutrition Service, Agriculture” Federal Account rather than its individual program activities.

21. Federal Account Profile: Child Nutrition Programs (Fiscal Year Snapshot)
This page shows the Federal Account Profile for Child Nutrition Programs. The page provides a fiscal year summary and displays a Sankey diagram showing the flow of funds in from balances brought forward and new appropriations which result in the Child Nutrition Programs’ total budget authority of $16.7B. The diagram also shows the flow of funds out for balances incurred and the unobligated balances.

22. Federal Account Profile: Child Nutrition Programs (Spending Over Time & By Category)
As we scroll down the Federal Account Profile page, we see Spending Over Time and Spending by Category. In this example, the Child Nutrition Programs has a FY2017 unobligated balance of $1.69M, incurred $22.91M in obligations and outlayed $22.47M. The view can be changed from “Years” to “Quarters.”
In the Spending by Category graphic, we can see that the Federal Account’s top Program Activities includes (1) the Summer Food Service Program, (2) Child Nutrition, (3) Commodity Procurement and (4) State Administrative Expenses.

23. Federal Account Profile: Child Nutrition Programs (Spending by Award)
As we continue scrolling down the page, we can view the Contracts, Grants, Direct Payments, Loans and Other Awards funded by the Child Nutrition Programs Federal Account. Here we see that 53 contracts leverage funding from the Federal Account Symbol
File C provides the ability to link the account to spending data something that was not possible prior to the DATA Act. With this ability, you can click on any of these awards to gain a deeper understanding of the award’s purpose, its recipient and place of performance.

24. Contract Profile: Department of Agriculture, Food and Nutrition Service
Clicking on award ID AG3198C brings us to the Contract Profile page. Here, I can see the awarding agency, sub-agency and office, the recipient, award amounts and contract details. As you can see, the recipient is Mathematica Policy Research, Inc. based in New Jersey. The period of performance is 2/15/2013 – 9/30/2018 and the primary place of performance is Alexandria, VA. The contract’s ceiling (or Potential Award Amount) is $19M while its obligated funding (or Current Award Amount) is $18.4M.

25. Contract Profile: Department of Agriculture, Food and Nutrition Service
Scrolling down further, I can view the award’s transaction history which enumerates all of the award’s modifications. In addition, I can view sub-award data (if it exists for this award) and financial system information.

26. usaspending.gov Data Download Options
The new website offers multiple ways to access the data. Users have access to the raw agency submission files, database snapshots or tools to more precisely define the data they find valuable (i.e., Custom Award Data or use of the API).

27. Find Out More!
Websites where the Guide and the full report can be accessed. Includes interactive version of the full report including links to other related resources such as individual agency reports and Social Security and Medicare Trustees Reports.
 Additional copies of the Citizen’s Guide are available upon request. Send an to if interested.