DOL Annual Report, Fiscal Year 2004 - Principal Financial Statements

DOL Annual Report, Fiscal Year 2004
Performance and Accountability Report

Principal Financial Statements Included in This Report

NOTE 2 - FUNDS WITH U.S. TREASURY

Funds with U.S. Treasury at September 30, 2004 consisted of the following:

	Entity Assets
(Dollars in thousands)	Unobligated Balance Available	Unobligated Balance Unavailable	Obligated Balance Not Yet Disbursed	Total Entity Assets	Non-entity Assets	Total

Revolving funds	$3,900	-	$24,280	$28,180	-	$28,180
Trust funds	149,034	53	52,908	201,995	2	201,997
Appropriated funds	2,566,402	655,579	6,179,624	9,401,605	-	9,401,605
Other	-	-	-	-	68,975	68,975

	$2,719,336	$655,632	$6,256,812	$9,631,780	$68,977	$9,700,757


Funds with U.S. Treasury at September 30, 2003 consisted of the following:

	Entity Assets
(Dollars in thousands)	Unobligated Balance Available	Unobligated Balance Unavailable	Obligated Balance Not Yet Disbursed	Total Entity Assets	Non-entity Assets	Total

Revolving funds	$3,900	-	$20,692	$24,592	-	$24,592
Trust funds	99,076	184	(127,486)	(28,226)	(206)	(28,432)
Appropriated funds	2,458,905	293,596	6,782,608	9,535,109	-	9,535,109
Other	-	-	-	-	84,244	84,244

	$2,561,881	$293,780	$6,675,814	$9,531,475	$84,038	$9,615,513

NOTE 3 - INVESTMENTS

Investments at September 30, 2004 consisted of the following:

		Face	Premium	Net	Market
(Dollars in thousands)		Value	(Discount)	Value	Value

Unemployment Trust Fund
	Non-marketable
	U.S. Treasury Certificates of Indebtedness
	4.375% maturing June 30, 2005	$10,238,570	-	$10,238,570	$10,238,570
	Special issue U.S. Treasury Bonds
	4.375% maturing June 30, 2005	4,210,119	-	4,210,119	4,210,119
	6.250% maturing June 30, 2005	22,266,681	-	22,266,681	22,266,681
	5.500% maturing June 30, 2006	8,524,011	-	8,524,011	8,524,011
		45,239,381	-	45,239,381	45,239,381

Panama Canal Commission
Compensation Fund
	Marketable
	U.S. Treasury Notes
	3.625% to 7.875% various maturities	27,685	450	28,135	28,607
	U.S. Treasury Bonds
	10.375% to 14.000% various maturities	49,428	6,494	55,922	58,767
		77,113	6,944	84,057	87,374

Energy Employees Occupational Illness
Compensation Fund
	Marketable
	U.S. Treasury Bill
	1.720% maturing October 1, 2004	46,833	-	46,833	46,833

Longshore and Harbor Workers' Trust Fund
	Marketable
	U.S. Treasury Bills
	1.340% to 1.890% various maturities	69,863	(210)	69,653	69,653

District of Columbia Trust Fund
	Marketable
	U.S. Treasury Bills
	1.320% to 1.790% various maturities	5,020	(13)	5,007	5,007

Backwage Restitution Fund
	Marketable
	U.S. Treasury Bill
	1.543% to 1.553% various maturities	1,593	(14)	1,579	1,579

		$45,439,803	$6,707	$45,446,510	$45,449,827


Entity investments		$45,353,104	$6,707	$45,359,811	$45,363,128
Non-entity investments		86,699	-	86,699	86,699

		$45,439,803	$6,707	$45,446,510	$45,449,827
Unemployment Trust Fund
	Non-marketable
	U.S. Treasury Certificates of Indebtedness
	4.625% maturing June 30, 2004	$1,367,501	-	$1,367,501	$1,367,501
	Special issue U.S. Treasury Bonds
	4.875% maturing June 30, 2004	522,089	-	522,089	522,089
	6.500% maturing June 30, 2004	14,068,830	-	14,068,830	14,068,830
	6.250% maturing June 30, 2005	23,705,952	-	23,705,952	23,705,952
	5.500% maturing June 30, 2006	8,524,011	-	8,524,011	8,524,011
		48,188,383	-	48,188,383	48,188,383

Panama Canal Commission
Compensation Fund
	Marketable
	U.S. Treasury Notes
	5.875% to 7.875% various maturities	13,747	43	13,790	14,882
	U.S. Treasury Bonds
	8.750% to 14.000% various maturities	62,701	12,222	74,923	77,192
		76,448	12,265	88,713	92,074

Energy Employees Occupational Illness
Compensation Fund
	Marketable
	U.S. Treasury Bill
	0.950% maturing October 1, 2003	60,232	-	60,232	60,232

Longshore and Harbor Workers' Trust Fund
	Marketable
	U.S. Treasury Bills
	0.900% to 0.990% various maturities	64,438	(90)	64,348	64,348

District of Columbia Trust Fund
	Marketable
	U.S. Treasury Bills
	0.900% to 0.960% various maturities	4,903	(5)	4,898	4,898

Backwage Restitution Fund
	Marketable
	U.S. Treasury Bill
	0.865% to 0.940% various maturities	1,592	(13)	1,579	1,579

		$48,395,996	$12,157	$48,408,153	$48,411,514


Entity investments		$48,339,233	$12,157	$48,351,390	$48,354,751
Non-entity investments		56,763	-	56,763	56,763

		$48,395,996	$12,157	$48,408,153	$48,411,514

NOTE 4 - ACCOUNTS RECEIVABLE, NET OF ALLOWANCE

Accounts receivable at September 30, 2004 consisted of the following:

(Dollars in thousands)				Gross Receivables	Allowance	Net Receivables

Entity intra-governmental assets
	Due for UCFE and UCX benefits			$333,918	-	$333,918
	Due for workers' compensation benefits			3,572,765	-	3,572,765
	Other			9,991	-	9,991
				3,916,674	-	3,916,674

Entity assets
	State unemployment taxes			755,789	(556,917)	198,872
	Due from reimbursable employers			659,820	(39,404)	620,416
	Benefit overpayments			2,091,586	(1,862,710)	228,876
	Other			6,991	(2,121)	4,870
				3,514,186	(2,461,152)	1,053,034

Non-entity assets
	Fines and penalties			115,869	(56,326)	59,543
	Backwages			24,846	(10,389)	14,457
				140,715	(66,715)	74,000
				3,654,901	(2,527,867)	1,127,034

				$7,571,575	$(2,527,867)	$5,043,708


Changes in the allowance for doubtful accounts during 2004 consisted of the following:



(Dollars in thousands)		Balance at September 30, 2003	Write-offs	Revenue Adjustment	Bad Debt	Balance at September 30, 2004

Entity assets
State unemployment taxes		$(524,043)	$307,970	$(340,844)	-	$(556,917)
Due from reimbursable employers		(36,072)	18,974	(22,306)	-	(39,404)
Benefit overpayments		(1,881,135)	688,846	-	(670,421)	(1,862,710)
Other		(481)	1,061	-	(2,701)	(2,121)
		(2,441,731)	1,016,851	(363,150)	(673,122)	(2,461,152)

Non-entity assets
Fines and penalties		(51,700)	8,504	(13,130)	-	(56,326)
Backwages		(921)	-	-	(9,468)	(10,389)
		(52,621)	8,504	(13,130)	(9,468)	(66,715)

		$(2,494,352)	$1,025,355	$(376,280)	$(682,590)	$(2,527,867)


Accounts receivable at September 30, 2003 consisted of the following:


(Dollars in thousands)				Gross Receivables	Allowance	Net Receivables

Entity intra-governmental assets
	Due for UCFE and UCX benefits			$254,464	-	$254,464
	Due for workers' compensation benefits			3,520,021	-	3,520,021
	Other			15,514	-	15,514
				3,789,999	-	3,789,999

Entity assets
	State unemployment taxes			665,961	(524,043)	141,918
	Due from reimbursable employers			538,542	(36,072)	502,470
	Benefit overpayments			2,090,664	(1,881,135)	209,529
	Other			9,242	(481)	8,761
				3,304,409	(2,441,731)	862,678

Non-entity assets
	Fines and penalties			113,206	(51,700)	61,506
	Backwages			16,425	(921)	15,504
				129,631	(52,621)	77,010
				3,434,040	(2,494,352)	939,688

				$7,224,039	$(2,494,352)	$4,729,687


Changes in the allowance for doubtful accounts during 2003 consisted of the following:



(Dollars in thousands)		Balance at September 30, 2002	Write-offs	Revenue Adjustment	Bad Debt	Balance at September 30, 2003

Entity assets
State unemployment taxes		$(518,847)	$299,589	$(304,785)	-	$(524,043)
Due from reimbursable employers		(36,583)	17,273	(16,762)	-	(36,072)
Benefit overpayments		(1,731,612)	318,674	-	(468,197)	(1,881,135)
Other		(491)	2,115	-	(2,105)	(481)
		(2,287,533)	637,651	(321,547)	(470,302)	(2,441,731)

Non-entity assets
Fines and penalties		(41,030)	6,966	(17,636)	-	(51,700)
Backwages		(3,825)	2,904	-	-	(921)
		(44,855)	9,870	(17,636)	-	(52,621)

		$(2,332,388)	$647,521	$(339,183)	$(470,302)	$(2,494,352)

NOTE 5 - ADVANCES

Advances at September 30, 2004 and 2003 consisted of the following:

(Dollars in thousands)				2004	2003

Advances to states for UI benefit payments				$623,172	$471,592
Advances to grantees and contractors to finance future DOL program expenditures				146,463	8,798
Other				7,397	688

				$777,032	$481,078



NOTE 6 - PROPERTY, PLANT AND EQUIPMENT, NET OF DEPRECIATION

Property, plant and equipment at September 30, 2004 and 2003 consisted of the following:

		2004			2003

(Dollars in thousands)		Cost or Basis	Accumulated Depreciation/ Amortization	Net Book Value	Net Book Value

Structures, facilities and improvements
	Structures and facilities	$801,869	$(337,815)	$464,054	$461,690
	Improvements to leased facilities	356,904	(206,116)	150,788	115,492
		1,158,773	(543,931)	614,842	577,182
Furniture and equipment
	Equipment held by contractors	160,744	(154,718)	6,026	9,648
	Furniture and equipment	62,648	(33,338)	29,310	31,128
		223,392	(188,056)	35,336	40,776

ADP software		106,406	(54,059)	52,347	49,693
Construction-in-progress		106,668	-	106,668	96,831
Land		67,076	-	67,076	66,076

		$1,662,315	$(786,046)	$876,269	$830,558



NOTE 7 - NON-ENTITY ASSETS

Non-entity assets consisted of the following at September 30, 2004 and 2003:

(Dollars in thousands)				2004	2003

Intra-governmental
	Funds with U.S. Treasury			$68,977	$84,038
	Investments			86,699	56,763
	Interest receivable from investments			1,086	828
				156,762	141,629
Accounts receivable, net of allowance				74,000	77,010

				$230,762	$218,639

NOTE 8 - ADVANCES FROM U.S. TREASURY

Advances from U.S. Treasury to the Black Lung Disability Trust Fund during 2004 consisted of the following:

(Dollars in thousands)		Balance at September 30, 2003	Net Borrowing	Balance at September 30, 2004

Intra-governmental
	Borrowing from the Treasury	$8,243,557	$497,000	$8,740,557

		$8,243,557	$497,000	$8,740,557


Advances from U.S. Treasury to the Black Lung Disability Trust Fund during 2003 consisted of the following:

(Dollars in thousands)		Balance at September 30, 2002	Net Borrowing	Balance at September 30, 2003

Intra-governmental
	Borrowing from the Treasury	$7,718,557	$525,000	$8,243,557

		$7,718,557	$525,000	$8,243,557


Assuming the continuation of current operating conditions, repayment of these and necessary future advances will require a change in the statutory operating structure of the fund. (See note 19.)



NOTE 9 - ACCRUED BENEFITS

Accrued benefits at September 30, 2004 and 2003 consisted of the following:

(Dollars in thousands)			2004	2003

	State regular and extended unemployment benefits payable		$869,504	$983,337
	Federal extended unemployment benefits payable		36,265	76,528
	Federal temporary extended unemployment benefits		23,581	199,700
	Federal emergency unemployment benefits payable		31,951	28,391
	Federal employees' unemployment benefits payable		26,200	24,499
	Federal employees' unemployment benefits for existing claims due in the subsequent year		141,022	152,614
	Total unemployment benefits payable		1,128,523	1,465,069
	Black lung disability benefits payable		55,542	25,654
	Federal employees' disability and 10(h) benefits payable		155,716	144,747
	Energy employees occupational illness compensation benefits payable		790	777
	Longshore and harbor workers disability benefits payable		3,155	2,172
	District of Columbia disability benefits payable		283	175

			$1,344,009	$1,638,594

NOTE 10 - FUTURE WORKERS' COMPENSATION BENEFITS

DOL's liability for future workers' compensation benefits at September 30, 2004 and 2003 consisted of the following:

(Dollars in thousands)			2004	2003

	Projected gross liability of the Federal government
	for future FECA benefits		$25,570,723	$27,054,049
	Less liabilities attributed to other agencies:
		U.S. Postal Service	(8,379,832)	(8,729,029)
		Department of Navy	(2,744,041)	(2,999,824)
		Department of Army	(1,937,818)	(2,081,971)
		Department of Veterans Affairs	(1,752,895)	(1,887,701)
		Department of Air Force	(1,418,832)	(1,558,355)
		Department of Transportation	(1,020,500)	(1,114,602)
		Department of Homeland Security	(1,398,161)	(1,103,401)
		Tennessee Valley Authority	(594,461)	(664,669)
		Department of Treasury	(678,272)	(782,903)
		Department of Agriculture	(836,341)	(939,818)
		Department of Justice	(829,336)	(839,748)
		Department of Interior	(664,856)	(711,565)
		Department of Defense, Other	(858,146)	(955,952)
		Department of Health and Human Services	(266,389)	(296,315)
		Social Security Administration	(288,158)	(305,289)
		General Services Administration	(176,351)	(195,552)
		Department of Commerce	(179,186)	(200,056)
		Department of Energy	(95,184)	(102,553)
		Department of State	(59,984)	(61,628)
		Department of Housing & Urban Development	(78,622)	(84,240)
		Department of Education	(19,882)	(22,265)
		National Aeronautics and Space Administration	(68,876)	(69,446)
		Environmental Protection Agency	(40,281)	(44,096)
		Small Business Administration	(28,436)	(31,822)
		Office of Personnel Management	(13,077)	(14,397)
		National Science Foundation	(1,465)	(1,649)
		Nuclear Regulatory Commission	(8,114)	(9,073)
		Agency for International Development	(24,523)	(27,400)
		Other	(580,636)	(626,605)
			(25,042,655)	(26,461,924)

			$528,068	$592,125

	Projected liability of the Department of Labor for future FECA benefits
		FECA benefits not chargeable to other Federal agencies payable by
		DOL's Federal Employees' Compensation Act Special Benefit Fund	$228,487	$241,639
		FECA benefits due to eligible workers of DOL and Job Corp enrollees	236,560	280,398
		FECA benefits due to eligible workers of the Panama Canal Commission	63,021	70,088

			$528,068	$592,125

NOTE 11 - OTHER LIABILITIES

Other liabilities at September 30, 2004 and 2003 consisted of the following current liabilities:

(Dollars in thousands)		2004	2003

Intra-governmental
	Accrued payroll and benefits	$8,281	$6,314
	Unearned FECA assessments	39,261	44,577
	Non-entity receipts due to U.S. Treasury	59,542	61,506
	Amounts held for the Railroad Retirement Board	86,209	55,806
	Advances from other Federal agencies	1,134	1,981
Total intra-governmental		194,427	170,184

Accrued payroll and benefits		40,833	34,539
Due to Backwage recipients		63,901	58,354
Unearned assessment revenue		48,117	44,653
Deposit and clearing accounts		20,738	38,561
Readjustment allowances and other Job Corps liabilities		58,244	86,518
Other advances		7,500	7,500
		239,333	270,125

		$433,760	$440,309



NOTE 12 - LIABILITIES NOT COVERED BY BUDGETARY RESOURCES

Liabilities not covered by budgetary resources at September 30, 2004 and 2003 consisted of the following:

(Dollars in thousands)		2004	2003

Intra-governmental
	Advances from U.S. Treasury	$8,740,557	$8,243,557

Future workers' compensation benefits		236,559	280,398
Accrued annual leave		94,846	93,324
Readjustment allowances and other Job Corps liabilities		58,244	86,518
		389,649	460,240

		$9,130,206	$8,703,797

NOTE 13 - PENSION EXPENSE

Pension expense in 2004 consisted of the following:

(Dollars in thousands)	Employer Contributions	Accumulated Costs Imputed by OPM	Total Pension Expense

Civil Service Retirement System	$31,473	$46,281	$77,754
Federal Employees' Retirement System	72,622	3,199	75,821
Thrift Savings Plan	28,712	-	28,712

	$132,807	$49,480	$182,287


Pension expense in 2003 consisted of the following:

(Dollars in thousands)	Employer Contributions	Accumulated Costs Imputed by OPM	Total Pension Expense

Civil Service Retirement System	$39,378	$48,827	$88,205
Federal Employees' Retirement System	65,834	2,954	68,788
Thrift Savings Plan	25,755	-	25,755

	$130,967	$51,781	$182,748