U.S. Department of Labor -- DOL Annual Report, Fiscal Year 2009 - Principal Financial Statements and Notes

DOL Annual Report, Fiscal Year 2009
Performance and Accountability Report

Principal Financial Statements and Notes

NOTE 2 — FUNDS WITH U.S. TREASURY

Funds with U.S. Treasury at September 30, 2009 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	$16,351	$-	$61,785	$78,136	$-	$78,136
Trust funds	2,340,232	-	(298,848)	2,041,384	(687)	2,040,697
General funds	2,742,223	637,147	8,902,843	12,282,213	-	12,282,213
Other	-	-	-	-	5,705	5,705
	$5,098,806	$637,147	$8,665,780	$14,401,733	$5,018	$14,406,751

Funds with U.S. Treasury at September 30, 2008 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	$13,388	$-	$45,518	$58,906	$-	$58,906
Trust funds	192,605	-	(285,620)	(93,015)	(503)	(93,518)
General funds	2,489,715	1,340,149	5,555,362	9,385,226	-	9,385,226
Other	-	-	-	-	78,316	78,316
	$2,695,708	$1,340,149	$5,315,260	$9,351,117	$77,813	$9,428,930

The negative fund balances reported as of September 30, 2009 and 2008 relate to the Unemployment Trust Fund (UTF) and are the result of the timing of processing the investments and redemptions of UTF. The investments and redemptions relating to the last business day of the month are not processed until the first day of the next month. This could result in a negative cash position for the preceding business day if the disbursements are greater than the receipts to the fund. Unobligated Balance Available at September 30, 2009 includes $558 million of funds apportioned for use in the subsequent year.

NOTE 3 — INVESTMENTS

Investments at September 30, 2009 consisted of the following:

(Dollars in thousands)		Face Value	Premium (Discount)	Interest Receivable	Net Value	Market Value
Unemployment Trust Fund
	Non-marketable
	Special issue U.S. Treasury Bonds
	3.250% maturing June 30, 2010	$334,382	$-	$32	$334,414	$334,382
	4.500% maturing June 30, 2011	19,293,800	-	217,055	19,510,855	19,293,800
		19,628,182	-	217,087	19,845,269	19,628,182
Panama Canal Commission Compensation Fund
	Marketable
	U.S. Treasury Notes
	3.500% to 4.625% various maturities	66,664	44	1,103	67,811	67,268
	U.S. Treasury Bonds
	11.750% to be called November 15, 2009	5,163	52	228	5,443	5,234
		71,827	96	1,331	73,254	72,502
Energy Employees Occupational Illness Compensation Fund
	Non-marketable
	One Day Certificate
	0.070% maturing October 1, 2009	192,823	-	-	192,823	192,823
		$19,892,832	$96	$218,418	$20,111,346	$19,893,507
Entity investments		$19,856,989	$96	$218,022	$20,075,107	$19,857,665
Non-entity investments		35,843	-	396	36,239	35,842
		$19,892,832	$96	$218,418	$20,111,346	$19,893,507

Investments at September 30, 2008 consisted of the following:

(Dollars in thousands)		Face Value	Premium (Discount)	Interest Receivable	Net Value	Market Value
Unemployment Trust Fund
	Non-marketable
	Special issue U.S. Treasury Bonds
	4.875% maturing June 30, 2009	$3,304,955	$-	$40,279	$3,345,234	$3,304,955
	5.000% maturing June 30, 2009	11,000,000	-	137,500	11,137,500	11,000,000
	5.000% maturing June 30, 2010	24,855,747	-	310,697	25,166,444	24,855,747
	4.500% maturing June 30, 2010	5,000,000	-	56,250	5,056,250	5,000,000
	4.500% maturing June 30, 2011	28,271,737	-	318,057	28,589,794	28,271,737
		72,432,439	-	862,783	73,295,222	72,432,439
Panama Canal Commission Compensation Fund
	Marketable
	U.S. Treasury Notes
	3.500% to 4.750% various maturities	70,089	5	1,166	71,260	71,247
	U.S. Treasury Bonds
	11.750% various maturities	5,163	472	228	5,863	5,729
		75,252	477	1,394	77,123	76,976
Longshore and Harbor Workers' Compensation Act Trust Fund
	Non-marketable
	One Day Certificate
	0.330% maturing October 1, 2008	61,905	-	-	61,905	61,905
District of Columbia Workmen's Compensation Act Trust Fund
	Non-marketable
	One Day Certificate
	0.330% maturing October 1, 2008	5,160	-	-	5,160	5,160
Energy Employees Occupational Illness Compensation Fund
	Non-marketable
	One Day Certificate
	0.330% maturing October 1, 2008	125,265	-	-	125,265	125,265
		$72,700,021	$477	$864,177	$73,564,675	$72,701,745
Entity investments		$72,590,369	$477	$862,871	$73,453,717	$72,592,093
Non-entity investments		109,652	-	1,306	110,958	109,652
		$72,700,021	$477	$864,177	$73,564,675	$72,701,745

NOTE 4 — ACCOUNTS RECEIVABLE, NET OF ALLOWANCE

Accounts receivable at September 30, 2009 consisted of the following:

(Dollars in thousands)	Gross Receivables	Allowance	Net Receivables
Entity intra-governmental assets
Due for UCFE and UCX benefits	$474,770	$-	$474,770
Due for workers' compensation benefits	4,982,929	-	4,982,929
Other	9,798	-	9,798
	5,467,497	-	5,467,497
Entity assets
State unemployment taxes	945,324	(682,354)	262,970
Due from reimbursable employers	733,404	(46,191)	687,213
Benefit overpayments	1,989,258	(1,640,575)	348,683
Other	5,247	(841)	4,406
	3,673,233	(2,369,961)	1,303,272
Non-entity assets
Fines and penalties	91,143	(40,574)	50,569
	3,764,376	(2,410,535)	1,353,841
	$9,231,873	$(2,410,535)	$6,821,338

Accounts receivable at September 30, 2008 consisted of the following:

(Dollars in thousands)	Gross Receivables	Allowance	Net Receivables
Entity intra-governmental assets
Due for UCFE and UCX benefits	$292,833	$-	$292,833
Due for workers' compensation benefits	3,771,775	-	3,771,775
Other	12,269	-	12,269
	4,076,877	-	4,076,877
Entity assets
State unemployment taxes	823,667	(639,682)	183,985
Due from reimbursable employers	502,342	(28,540)	473,802
Benefit overpayments	1,935,897	(1,678,795)	257,102
Other	13,126	(2,127)	10,999
	3,275,032	(2,349,144)	925,888
Non-entity assets
Fines and penalties	76,778	(32,605)	44,173
Backwages	16,785	(10,418)	6,367
	93,563	(43,023)	50,540
	3,368,595	(2,392,167)	976,428
	$7,445,472	$(2,392,167)	$5,053,305

NOTE 5 — PROPERTY, PLANT AND EQUIPMENT, NET OF ACCUMULATED DEPRECIATION

Property, plant and equipment at September 30, 2009 consisted of the following:

	2009
(Dollars in thousands)	Cost	Accumulated Depreciation/Amortization	Net Book Value
Structures, facilities and improvements
Structures and facilities	$1,111,949	$(468,889)	$643,060
Improvements to leased facilities	420,863	(244,674)	176,189
	$1,532,812	(713,563)	819,249
Furniture and equipment
Equipment held by contractors	170,681	(162,628)	8,053
Furniture and equipment	33,248	(22,614)	10,634
	203,929	(185,242)	18,687
Internal use software	196,561	(73,408)	123,153
Construction-in-progress	97,377	-	97,377
Land	95,774	-	95,774
	$2,126,453	$(972,213)	$1,154,240

Property, plant and equipment at September 30, 2008 consisted of the following:

	2008
(Dollars in thousands)	Cost	Accumulated Depreciation/Amortization	Net Book Value
Structures, facilities and improvements
Structures and facilities	$1,067,982	$(437,047)	$630,935
Improvements to leased facilities	423,580	(233,798)	189,782
	1,491,562	(670,845)	820,717
Furniture and equipment
Equipment held by contractors	166,504	(159,612)	6,892
Furniture and equipment	51,777	(36,132)	15,645
	218,281	(195,744)	22,537
Internal use software	206,369	(92,110)	114,259
Construction-in-progress	90,233	-	90,233
Land	93,253	-	93,253
	$2,099,698	$(958,699)	$1,140,999

NOTE 6 — ADVANCES

Advances at September 30, 2009 and 2008 consisted of the following:

(Dollars in thousands)	2009	2008
Advances to states for UI benefit payments	$1,583,858	$706,556
Advances to grantees and contractors to finance future DOL program expenditures	16,298	35,947
Other	90,942	13,907
	$1,691,098	$756,410

NOTE 7 — NON-ENTITY ASSETS

Non-entity assets consisted of the following at September 30, 2009 and 2008:

(Dollars in thousands)	2009	2008
Intra-governmental
Funds with U.S. Treasury	$5,018	$77,813
Investments	36,239	110,958
	41,257	188,771
Accounts receivable, net of allowance	50,569	50,540
	$91,826	$239,311

NOTE 8 — DEBT

DOL�s debt during 2009 consisted of the following:

(Dollars in thousands)			Balance at September 30, 2008	Refinancing	Net Borrowing	Balance at September 30, 2009
Intra-governmental
	Debt to Treasury
		Black Lung Disability Trust Fund
		Advances from U.S. Treasury	$10,483,557	$(10,483,557)	$-	$-
		Borrowing from U.S. Treasury	-	6,495,717	(125,137)	6,370,580
		Unemployment Trust Fund
		Advances from U.S. Treasury	-	-	7,981,387	7,981,387
			$10,483,557	$(3,987,840)	$7,856,250	$14,351,967

DOL�s debt during 2008 consisted of the following:

(Dollars in thousands)		Balance at September 30, 2007	Refinancing	Net Borrowing	Balance at September 30, 2008
Intra-governmental
Debt to Treasury
	Black Lung Disability Trust Fund
	Advances from U.S. Treasury	$10,057,557	$-	$426,000	$10,483,557

Refinancing includes the replacement of high interest rate Advances from U.S. Treasury with borrowings in the form of discounted instruments, similar to zero coupon bonds. Net borrowing includes capitalized interest of $212,335 and repaid debt of $337,472 for the Black Lung Disability Trust fund and new advances of $7,950,000 and accrued interest of $31,387 for the Unemployment Trust Fund. (See Note 1-J)

NOTE 9 — OTHER LIABILITIES

Other liabilities at September 30, 2009 and 2008 consisted of the following current liabilities:

(Dollars in thousands)		2009	2008
Intra-governmental
	Accrued payroll benefits	$15,222	$13,055
	Unearned FECA assessments	18	52,724
	Non-entity receivables due to U.S. Treasury	50,332	42,803
	Amounts held for the Railroad Retirement Board	35,552	110,455
	Advances from other Federal agencies	300	300
Total intra-governmental		101,424	219,337

Accrued payroll and benefits		69,124	59,043
Due to Backwage recipients		-	84,925
Unearned assessment revenue		-	41,217
Deposit and clearing accounts		5,944	1,127
Readjustment allowances and other Job Corps liabilities		75,374	54,537
		150,442	240,849
		$251,866	$460,186

NOTE 10 — ACCRUED BENEFITS Accrued benefits at September 30, 2009 and 2008 consisted of the following:

(Dollars in thousands)	2009	2008
State regular and extended unemployment benefits payable	$1,775,266	$966,415
Federal extended unemployment benefits payable	520,503	39,144
Federal emergency unemployment benefits payable, 2008	1,230,920	324,534
Federal emergency unemployment benefits payable, other	69,505	70,710
Federal employees' unemployment benefits payable	28,104	25,431
Federal employees' unemployment benefits for existing
claims due in the subsequent year	614,451	202,759
Federal additional unemployment benefits payable	231,361	-
Total unemployment benefits payable	4,470,110	1,628,993
Black lung disability benefits payable	36,017	40,003
Federal employees' disability and 10(h) benefits payable	90,017	76,952
Energy employees occupational illness compensation benefits payable	31,106	24,712
Longshore and harbor workers disability benefits payable	-	4,571
District of Columbia disability benefits payable	-	345
	$4,627,250	$1,775,576

NOTE 11 — FUTURE WORKERS' COMPENSATION BENEFITS

DOL�s liability for future workers� compensation benefits at September 30, 2009 and 2008 consisted of the following:

(Dollars in thousands)	2009	2008
Projected gross liability of the Federal government for future FECA benefits	$26,953,702	$27,589,632
Less liabilities attributed to other agencies:
U.S. Postal Service	(9,507,251)	(9,543,798)
Department of Navy	(2,425,587)	(2,685,911)
Department of Army	(1,790,270)	(1,980,257)
Department of Veterans Affairs	(1,734,929)	(1,905,472)
Department of Air Force	(1,286,935)	(1,395,449)
Department of Transportation	(970,738)	(985,336)
Department of Homeland Security	(1,826,221)	(1,795,351)
Tennessee Valley Authority	(505,491)	(532,499)
Department of Treasury	(525,430)	(593,196)
Department of Agriculture	(845,995)	(832,013)
Department of Justice	(1,233,899)	(1,136,570)
Department of Interior	(697,210)	(692,389)
Department of Defense, Other	(815,854)	(800,883)
Department of Health and Human Services	(253,312)	(282,517)
Social Security Administration	(310,636)	(297,932)
General Services Administration	(135,953)	(163,826)
Department of Commerce	(171,187)	(169,580)
Department of Energy	(95,897)	(104,734)
Department of State	(71,621)	(68,892)
Department of Housing and Urban Development	(69,058)	(84,529)
Department of Education	(16,199)	(16,554)
National Aeronautics and Space Administration	(56,912)	(63,977)
Environmental Protection Agency	(44,122)	(44,615)
Small Business Administration	(29,640)	(27,061)
Office of Personnel Management	(21,695)	(22,139)
National Science Foundation	(1,319)	(1,198)
Nuclear Regulatory Commission	(7,628)	(7,059)
Agency for International Development	(26,885)	(23,137)
Other	(586,569)	(569,922)
	(26,064,443)	(26,826,796)
	$889,259	$762,836
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	$616,541	$473,892
FECA benefits due to eligible workers of DOL and Job Corps enrollees	216,793	235,382
FECA benefits due to eligible workers of the Panama Canal Commission	55,925	53,562
	$889,259	$762,836

NOTE 12 — LIABILITIES NOT COVERED BY BUDGETARY RESOURCES

Liabilities not covered by budgetary resources at September 30, 2009 and 2008 consisted of the following:

(Dollars in thousands)		2009	2008
Intra-governmental
	Debt	$14,320,580	$10,483,557
Accrued benefits		515,593	-
Future workers' compensation benefits		296,339	231,965
Accrued annual leave		99,737	105,763
Readjustment allowances and other Job Corps liabilities		74,699	54,537
		986,368	392,265
		$15,306,948	$10,875,822

NOTE 13 — CONTINGENCIES

The Department is involved in various lawsuits incidental to its operations. Judgments resulting from litigation against the Department are generally paid by the Department of Justice. In the opinion of management, the ultimate resolution of pending litigation will not have a material effect on the Department�s financial position.

NOTE 14 — PENSION EXPENSE

Pension expense in 2009 consisted of the following:

(Dollars in thousands)	Employer Contributions	Costs Imputed by OPM	Total Pension Expense
Civil Service Retirement System	$21,938	$36,392	$58,330
Federal Employees' Retirement System	110,402	2,849	113,251
Thrift Savings Plan	41,613	-	41,613
	$173,953	$39,241	$213,194

Pension expense in 2008 consisted of the following:

(Dollars in thousands)	Employer Contributions	Costs Imputed by OPM	Total Pension Expense
Civil Service Retirement System	$22,251	$36,925	$59,176
Federal Employees' Retirement System	103,805	-	103,805
Thrift Savings Plan	39,286	-	39,286
	$165,342	$36,925	$202,267