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Analysis of FY 2006 Financial Conditions and Results

 

Composition of Assets and Assets by Responsibility Segment

The composition (by percentage) and distribution (by responsibility segment) of the Department’s assets remained consistent from FY 2005 to FY 2006.

Total assets amounted to $13.36 billion at September 30, 2006. Fund Balance with Treasury of $7.23 billion is the aggregate amount of funds available to make authorized expenditures and pay liabilities. General Property, Plant, and Equipment (General PP&E), Net of Accumulated Depreciation of $5.30 billion includes $3.47 billion of Construction-in-progress, primarily of satellites and weather measuring and monitoring systems; $556 million of satellites and weather systems; $711 million of structures, facilities, and leasehold improvements; and $565 million of other General PP&E. Loans Receivable and Related Foreclosed Property, Net of $468 million primarily relates to the National Oceanic and Atmospheric Administration’s (NOAA) direct loan programs. Accounts Receivable, Net of $146 million resulted primarily when the Department performed reimbursable services or sold goods. Other Assets of $215 million primarily includes Inventory, Materials, and Supplies, Net of $96 million, and Advances and Prepayments of $105 million.

Composition of the Department's Assets
Asset Percentage
Fund Balance with Treasury 54%
General Property, Plant, and Equipment, Net 40%
Loans Receivable and Related Foreclosed Property, Net  3%
Other  2%
Accounts Receivable, Net  1%

Assets by Responsibility Segment
Responsibility Segment Percentage
NOAA 64%
USPTO 12%
TA 10%
Others  9%
ESA  4%
Department Management  1%

Trends in Assets

Total Assets increased $630 million or five percent, from $12.73 billion at September 30, 2005 to $13.36 billion at September 30, 2006. Fund Balance with Treasury increased $191 million or three percent, from $7.04 billion to $7.23 billion, which primarily resulted from Appropriations Received, net of reductions, increasing by $293 million or five percent. General PP&E increased $371 million or eight percent, from $4.93 billion to $5.30 billion, mainly due to an increase in NOAA’s Construction-in-progress, primarily for satellites. Loans Receivable and Related Foreclosed Property, Net increased $50 million or 12 percent, from $418 million to $468 million, primarily due to NOAA’s Fisheries Finance Traditional Loans.

Trends in Total Assets
(In Millions)
FY 1998 FY 1999 FY 2000 FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006
$8,949 $9,399 $10,611 $10,994 $11,436 $11,758 $11,936 $12,730 $13,360

Composition of Liabilities and Liabilities by Responsibility Segment

The composition (by percentage) and distribution (by responsibility segment) of the Department’s liabilities also remained consistent from FY 2005 to FY 2006.

Total liabilities amounted to $3.89 billion at September 30, 2006. Unearned Revenue of $1.39 billion represents the portion of monies received from customers for which goods and services have not been provided or rendered by the Department. Federal Employee Benefits of $590 million is composed of the actuarial present value of projected benefits for the NOAA Corps Retirement System ($371 million) and the NOAA Corps Post-retirement Health Benefits ($49 million), and Actuarial Federal Employees Compensation Act (FECA) Liability ($170 million), which represents the liability for future workers’ compensation benefits. Accounts Payable of $364 million consists primarily of amounts owed for goods, services, or capitalized assets received; progress on contract performance by others; and other expenses due. Accrued Grants of $421 million, which relates to a diverse array of financial assistance programs and projects, includes the Economic Development Administration’s (EDA) accrued grants of $276 million for their economic development and assistance funding to state and local governments. Debt to Treasury of $422 million consists of monies borrowed primarily for NOAA’s direct loan programs. Accrued Payroll and Annual Leave of $370 million includes salaries and wages earned by employees, but not disbursed as of September 30. Other Liabilities of $334 million primarily includes Downward Subsidy Reestimates Payable to Treasury of $31 million, Loan Guarantee Liabilities of $74 million, Environmental and Disposal Liabilities of $75 million, and Resources Payable to Treasury of $35 million.

Composition of the Department's Liabilities
Asset Percentage
Unearned Revenue 36%
Federal Employee Benefits 15%
Accrued Grants 11%
Debt to Treasury 11%
Accrued Payroll and Annual Leave 10%
Accounts Payable  9%
Other  8%

Liabilities by Responsibility Segment
Responsibility Segment Percentage
NOAA 39%
USPTO 28%
Others 14%
TA  8%
ESA  7%
Department Management  4%

Trends in Total Liabilities
(In Millions)
FY 1998 FY 1999 FY 2000 FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006
$2,259 $2,499 $2,864 $2,997 $3,134 $3,187 $3,250 $3,762 $3,891

Trends in Liabilities

Total Liabilities increased $129 million or three percent, from $3.76 billion at September 30, 2005 to $3.89 billion at September 30, 2006. Unearned Revenue increased $103 million or eight percent, from $1.29 billion to $1.39 billion, primarily due to increased unearned revenue from patent and trademark application and user fees that are pending action. Debt to Treasury increased $64 million or 18 percent, from $358 million to $422 million, mainly due to net borrowings in FY 2006 of $60 million for NOAA’s direct loan programs. Accounts Payable decreased $36 million or nine percent, from $400 million to $364 million, primarily due to NOAA’s implementation of Central Contractor Registry in FY 2006.

Composition of and Trends in Financing Sources

Most of the Department’s Financing Sources, shown on the Consolidated Statements of Changes in Net Position, are obtained from Appropriations Received, net of reductions. Other typical Financing Sources include net transfers to and from other federal agencies without reimbursement, imputed financing sources from costs absorbed by other federal agencies, and Downward Subsidy Reestimates Payable to Treasury (a negative Financing Source).

The composition (by percentage) of the Department’s financing sources remained consistent from FY 2005 to FY 2006.

Total Financing Sources increased $334 million or five percent, from $6.59 billion for FY 2005 to $6.93 billion for FY 2006. Appropriations Received, net of reductions, increased by $293 million or five percent. Other Financing Sources increased by $37 million from $110 million at September 30, 2005 to $147 million at September 30, 2006.

Composition of the Department's FY 2006 Financing Sources
Source Percentage
Appropriations Received 98%
Other  2%

FY 2006 Net Cost of Operations by Strategic Goal

FY 2006 Net Cost of Operations
Breakdown of Gross Costs and
Earned Revenue by Strategic Goal
(In Millions)
  Total
Earned Revenue
Total
Gross Costs
Totals
Strategic Goal 1 $  308 $(2,124) $(1,816)
Strategic Goal 2 $1,821 $(2,528) $  (707)
Strategic Goal 3 $  278 $(4,171) $(3,893)

In FY 2006, Net Cost of Operations amounted to $6.42 billion, which consists of Gross Costs of $8.83 billion less Earned Revenue of $2.41 billion.

Strategic Goal 1, Provide the Information and Tools to Maximize U.S. Competitiveness and Enable Economic Growth for American Industries, Workers, and Consumers, includes Net Program Costs of $844 million (Gross Costs of $1.10 billion less Earned Revenue of $253 million) for Census Bureau. The Census Bureau carries out the Decennial Census, periodic censuses, and demographic and other surveys, and prepares and releases targeted data products for economic and other programs. ITA’s programs and activities also support Strategic Goal 1, with Net Program Costs of $418 million (Gross Costs of $431 million less Earned Revenue of $13 million). ITA assists the export growth of small and medium-sized businesses, enforces U.S. trade laws and trade agreements, monitors and maintains trading relationships with established markets, promotes new business in emerging markets, and improves access to overseas markets by identifying and pressing for the removal of trade barriers. Strategic Goal 1 also includes Net Program Costs of $346 million (Gross Costs of $362 million less Earned Revenue of $16 million) for EDA. EDA helps distressed communities address problems associated with long-term economic distress, as well as sudden and severe economic dislocations, including recovering from the economic impacts of natural disasters, the closure of military installations and other federal facilities, changing trade patterns, and the depletion of natural resources.

Strategic Goal 2, Foster Science and Technological Leadership by Protecting Intellectual Property (IP), Enhancing Technical Standards, and Advancing Measurement Science, includes Net Program Costs of $(49) million (Gross Costs of $1.34 billion less Earned Revenue of $1.38 billion) for the U.S. Patent and Trademark Office’s (USPTO) patents program, which includes processing patent applications and disseminating patent information. Through issuing patents, USPTO encourages technological advancement by providing incentives to invent, invest in, and disclose new technology. Strategic Goal 2 also includes Net Program Costs of $482 million (Gross Costs of $593 million less Earned Revenue of $111 million) for the National Institute of Standards and Technology’s (NIST) Measurement and Standards Laboratories. These laboratories are the stewards of the nation’s measurement infrastructure, and provide measurement methods, reference materials, test procedures, instrument calibrations, fundamental data, and standards that comprise essential tools for research, production, and buyer-seller transactions.

Strategic Goal 3, Observe, Protect, and Manage the Earth’s Resources to Promote Environmental Stewardship, includes Net Program Costs of $1.31 billion (Gross Costs of $1.43 billion less Earned Revenue of $122 million) related to NOAA’s stewardship of ecosystems, which reflects NOAA’s mission to conserve, protect, manage, and restore fisheries and coastal and ocean resources. The Department has a responsibility for stewardship of the marine ecosystem and for setting standards to protect and manage the shared resources and harvests of the oceans. The Department strives to balance sustainable development and healthy functioning marine ecosystems, and to conserve, protect, restore, and better manage resources.


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