Performance and 

Accountability Report

Fiscal Year 2007

Table of Contents


Message from the Commissioner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2


Management’s Discussion and Analysis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5


Overview of CBP. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6


Mission. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6


Core Values . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6


Fiscal Year 2007 Statistical Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6


Major Mission Programs and Strategies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7


Focused Law Enforcement Initiatives. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9


Budget by Program. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22


Budget Resource Obligations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23


Looking Ahead. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24


Organization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27


Headquarters. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28


Performance Goals and Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34


Performance Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34


Fiscal Year 2007 Performance by Strategic Goal. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35


Management Assurances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47


Federal Managers’ Financial Integrity Act (FMFIA). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47


DHS Financial Accountability Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .48


Reports Consolidation Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49


Federal Financial Management Improvement Act (FFMIA). . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49


Federal Information Security Management Act (FISMA) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49


Systems and Controls . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50


Financial Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52


President’s Management Agenda (PMA). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52


Improper Payments Information Act of 2002 (IPIA). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56


Overview of the Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57


Limitations of the Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .63


Performance Section . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65


Performance Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66


Individual Performance Measure Results. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66


Financial Section. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77


Message from the Chief Financial Officer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78


Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80


Notes to Financial Statements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88


Required Supplementary Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124


Other Accompanying Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .129


Auditor Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 137


Office of Inspector General (OIG) Report on Major Challenges. . . . . . . . . . . . . . . . . . . . . . . .137


Independent Auditor’s Report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .137


Management’s Response to the Independent Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . .163


Acronyms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164

Message from the Commissioner


I am pleased to present the Fiscal Year 2007 Performance and Accountability 

Report for U.S. Customs and Border Protection (CBP). 

U.S. Customs and Border Protection is charged with a dual mission of securing 

our nation’s borders without stifling the flow of legitimate trade. Over the past 

year, we have made steady progress toward better protecting our country from 

the threat of global terrorism, while we have continued our efforts to stem 

illegal immigration, drug trafficking, and alien smuggling. We have also made 

progress in protecting our economy by enforcing Intellectual Property Rights 

and other trade violations, securing and facilitating legitimate travel, and protecting our food supply and agriculture industry from pests and disease. 

The Department of Homeland Security’s Secure Border Initiative, which includes CBP’s SBInet program, 

is helping us gain control of our nation’s borders. We are accomplishing this by determining the appropriate mix of technology, infrastructure, and personnel along the most vulnerable portions of our border. In 

addition, we continue to hire and deploy more Border Patrol Agents. We have also implemented the first 

phase of the Western Hemisphere Travel Initiative (WHTI) at all air ports of entry and are completing all 

regulatory, business and technical requirements necessary to implement WHTI at our sea and land ports. 

As a result of the Fiscal Year 2007 Financial Audit, CBP again received an unqualified opinion on our 

financial statements. This outstanding accomplishment demonstrates CBP’s discipline and accountability in the execution of its fiscal responsibilities as a steward of CBP programs, and reflects the second 

year of a full-scope unqualified audit opinion. 

The Performance and Accountability Report addresses CBP’s compliance with financial management 

requirements and identifies some areas for improvement: 

• CBP has evaluated its management controls and financial management systems and is compliant 

with the Federal Managers’ Financial Integrity Act of 1982 (FMFIA) and its internal controls over 

financial reporting as required by the Department of Homeland Security Financial Accountability Act. 

• As a result of a self-assessment, CBP identified six material weaknesses for Fiscal Year 2007, four 

of which existed in the previous year: 1) core financial systems, 2) financial systems functionality 

and technology, 3) information technology general and application controls, and 4) laptop computer 

security. A fifth previously reported weakness related to drawback controls has been expanded to 

reflect deficiencies in foreign trade zones, customs bonded warehouses and the tracking of in-bond 

cargo. And sixth, CBP identified the implementation of management controls for the Secure Border 

Initiative Program Executive Office as a new material weakness. 

2 U .S ..Customs.and.Border.Protection.•.Performance.and.Accountability.Report 
• While current CBP financial management systems do not substantially comply with Federal financial 

management systems requirements and the U.S. Government Standard General Ledger at the 

transaction level, CBP is modernizing its financial systems. CBP is now in its fourth year of using SAP 

(Systems, Applications, and Products) as an integrated solution for its budget, procurement, asset 

management, finance, and reporting business processes. 

• KPMG LLP conducted an independent audit on CBP’s Fiscal Year 2007 Financial Statements. Material 

weaknesses, as evidenced by the auditor’s report found in the Financial Section of this report, support 

those identified through CBP’s self-assertion process with three exceptions. The first is the material 

weakness on laptop computer security identified by the Department of Homeland Security (DHS) 

Office of the Inspector General (OIG) audit in Fiscal Year 2006. The second is the material weakness 

on the implementation of management controls for the Secure Border Initiative Program Executive 

Office, which was also identified by the DHS OIG as a major management challenge in Border Security 

in Fiscal Year 2006, and third, the inclusion of foreign trade zones, customs bonded warehouses, and 

the tracking of in-bond cargo as part of the overall drawback material weakness. 

CBP will work to improve deficiencies identified in the Performance and Accountability Report and will 

put in place timetables for corrective action to ensure future compliance. We remain committed to 

sharing information on our financial and program performance each year. 

This year, CBP processed over 400 million passengers and pedestrians, as well as more than 25 million 

sea, truck and rail containers. We apprehended over 876,000 aliens attempting to enter the U.S. illegally; 

seized over 1.7 million pounds of illegal drugs and collected over $33 billion, including both custodial 

and entity revenue. 

While our accomplishments for 2007 are impressive, CBP is a forward-looking organization with our eyes 

on the future. My congratulations and appreciation to the entire CBP workforce for the amazing job you 

have done this year, and that you continue to do each and every day to protect this nation, our citizens, 

and our economy. We are a can-do agency determined to accomplish our mission by working together 

with our partners here at home and around the world. 

W. Ralph Basham 

Commissioner 

November 13, 2007 

Message from the Commissioner 3 
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Management’s Discussion 

and Analysis 
Overview of CBP


Mission 

U.S. Customs and Border Protection (CBP) is the unified border agency within the Department of Homeland Security (DHS) charged with the priority mission of preventing terrorists and terrorist weapons from 

entering the United States, while also facilitating the flow of legitimate trade and travel. More than 

46,743 CBP employees manage, control, and protect the Nation’s borders at and between the official 

ports of entry. CBP is responsible for protecting more than 5,000 miles of border with Canada, 1,900 

miles of border with Mexico, and 95,000 miles of shoreline. As the single unified border agency, CBP’s 

mission is vitally important to the protection of the American people and the national economy. 

Core Values 

Vigilance is how we ensure the safety of all Americans. We are continuously watchful and alert to deter, 

detect, and prevent threats to our Nation. We demonstrate courage and valor in the protection of our 

Nation. 

Service to Country is embodied in the work we do. We are dedicated to defending and upholding the 

Constitution of the United States. The American people have entrusted us to protect the homeland and 

defend liberty. 

Integrity is our cornerstone. We are guided by the highest ethical and moral principles. Our actions bring 

honor to ourselves and to our agency. 

Fiscal Year 2007 Statistical Highlights. 

• Ports of entry: 327 (includes 15 preclearance stations) 

• Border Patrol sectors: 20 (with 142 Border Patrol stations nationwide and 34 permanent checkpoints) 

• Air units: 40 (2 Training locations and 2 Radar/Communications locations) 

• Marine units: 31 (2 Training locations) 

• Trade entries processed: 30 million 

• Total revenue collected: over $33 billion (includes custodial and entity revenue) 

• Illegal narcotics seized: 1.7 million pounds (represents narcotics held by CBP until disposal or 

destruction) 

• Illegal alien apprehensions between the ports of entry: 876,704 

• Inadmissable aliens interdicted at the ports of entry: 207,368 

• Pedestrians and passengers processed: 414 million 

• Conveyances processed: 124 million 

6 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


CBP officer seizes illegal substance 

concealed in a vehicle. 

Drug Seizure Statistics 

(Note: The following amounts represent total CBP seizures, including 

amounts transferred to other government agencies for disposition.) 

• Number of pounds of cocaine seized: 281,371 

• Number of pounds of heroin seized: 2,167 

• Number of pounds of marijuana seized: 2,786,137 

• Number of pounds of methamphetamine seized: 3,248 

Major Mission Programs 

and Strategies 

As the frontline agency responsible for securing the Nation’s borders while facilitating legitimate trade and travel, CBP maintains 

several programs to accomplish this mission. The CBP National 

Targeting Center uses risk assessment and targeting analysis to 

support these programs. 

Secure Border Initiative (SBI) and SBInet

The DHS has established three long-term goals to achieve the mission of securing the Nation’s borders: 

(1) gain effective control of the borders; (2) strengthen interior enforcement and compliance; and 

(3) support the passage of a viable Temporary Worker Program (TWP). These three goals are highly 

interdependent and must be addressed simultaneously and collectively to achieve border security. 

Although CBP has responsibilities across the full range of activities in the DHS Secure Border Initiative 

(SBI) strategy, CBP also has especially critical responsibilities in the execution and accomplishment of 

the SBI goal to gain effective control of the borders. 

In fiscal year 2007, CBP established the SBI office within the Office of the Commissioner. The SBI office 

has a dual responsibility. First, the SBI office is the organization accountable for the development and 

oversight of the Secure Border Initiative (SBInet) program and the transportation program. Second, it will 

provide CBP-wide coordination, analysis, and integration of SBI-related programs and activities. 

CBP is the executive agent in DHS for the development and implementation of SBInet. SBInet is the 

component of SBI charged with developing and installing the technology and tactical infrastructure 

solution for border control at and between our ports of entry. SBInet will enable CBP to determine the 

appropriate mix of personnel, technology, and tactical infrastructure for specific border areas. Furthermore, Secure Border Initiative (SBInet) will provide effective command, control, communications, and 

intelligence (C3I) of the border environment, which will provide uniform data to all DHS agencies and be 

interoperable with stakeholders external to DHS. 

Management’s Discussion and Analysis  
Overview of CBP


CBP Border Patrol agent patrols a remote area near the 

U.S. border. 

National Border Patrol Strategy 

The land ports of entry (POEs) serve as designated 

access points into the United States. Between the 

POEs lie miles of open space, deserts, waterways, 

forests, and prairies, making our Nation’s borders 

vulnerable to the threats of terrorism and to exploitation by smugglers of humans and illegal narcotics 

and other contraband. The CBP’s Office of Border 

Patrol’s (OBP) strategic goal is to gain and maintain 

control of the U.S. borders between the POEs. To 

assist in achieving its goal, the Border Patrol implemented the National Border Patrol Strategy in 2005, 

which articulates a clear, strategic mission and program purpose to establish and maintain border 

security. The five main objectives of the National 

Border Patrol Strategy are as follows: 

1.	 Establish substantial probability of apprehending 

terrorists and their weapons as they attempt to 

enter illegally between the POEs; 

2. Deter illegal entries through improved enforcement; 

3. Detect, apprehend, and deter smugglers of humans, drugs, and other contraband; 

4. Leverage “Smart Border” technology to multiply the effect of enforcement personnel; and 

5. Reduce crime in border communities and consequently improve the quality of life and economic 

vitality of targeted areas. 

To accomplish these objectives, the Border Patrol strategy requires the deployment of the “right mix” of 

personnel, tactical infrastructure, and technology to gain and maintain border security. 

Personnel 

To meet the President’s objective to increase Border Patrol Agents staffing by 6,000 new Border Patrol 

agents by the end of calendar year 2008, the Border Patrol has worked with the Offices of Human 

Resources Management and Training and Development in developing and implementing an aggressive 

plan to recruit, hire, and train new Border Patrol agents. This unprecedented hiring effort resulted in a 

total of 2,574 new agents added to the Border Patrol workforce in fiscal year 2007. 

Tactical Infrastructure 

SBI and Border Patrol achieved gains in securing the border through the deployment of “Smart Border” 

technology, which includes tactical infrastructure (fence, vehicle barriers, roads, and lighting). Tactical 

infrastructure is deployed to regions of the border on the basis of terrain and threat considerations. Of 

the 70 miles of additional primary fence (PF-70) targeted for completion by the end of fiscal year 2007, 

CBP has installed 72.3 miles during fiscal year 2007, for a total of approximately 154.7 miles. A total of 

109.5 miles of vehicle barriers have been installed as of September 30, 2007, and construction was 

completed on approximately 10.1 miles of lighting and 20 miles of all-weather roads. During fiscal year 

8 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


2007, 400.2 miles of tactical infrastructure were constructed. In addition, approximately 508 miles of 

existing roads were repaired. 

Technology 

Another key element of the SBI’s and Border Patrol’s “Smart Border” technology objective is SBInet. 

SBInet will provide the Border Patrol with state-of-the art technologies to support its border enforcement 

mission. These new technologies will enable the Border Patrol to more consistently detect, identify, 

classify, respond to, and resolve illegal border crossings. These new capabilities will enhance national 

security by making our borders more safe and secure. 

Effective Control of the Border 

Through the deployment of the right mix of new resources and enforcement operations supported by intelligence activities, the Border Patrol increased the miles of border under effective control from 449 miles 

at the beginning of fiscal year 2007 to 599 miles as of September 30, 2007, a 33 percent increase. 

Focused Law Enforcement Initiatives 

In its continuing effort to counter border threats and vulnerabilities, the Border Patrol made gains in 

securing the border through focused law enforcement initiatives designed to support the objectives of 

the National Border Patrol Strategy. 

Defense-In-Depth Strategy—Traffic Checkpoint Operations 

The Border Patrol currently operates a combination of 34 permanent and 88 tactical traffic checkpoints 

nationwide as part of a three-tiered defense-in-depth strategy in securing our Nation’s border between 

the POEs. This strategy involves the use of line-watch operations on the border, roving patrol operations 

near the border, and traffic checkpoints away from the border. As the third layer in the Border Patrol 

defense-in-depth strategy, traffic checkpoints have proven to be a critical component in the support of 

line-watch and roving patrol operations. Border Patrol traffic checkpoint operations play a significant 

strategic and tactical role in the support of the National Border Patrol Strategy beyond the immediate 

border area. The primary targets of an effective Border Patrol traffic checkpoint operation are terrorists 

and terrorist weapons, criminals, and smugglers of humans and narcotics who have successfully evaded 

detection at or between the POEs. 

Traffic checkpoints are generally located within 100 miles of the border. Smugglers often resort to 

main arterial highways as an avenue to further the illegal entry of their smuggling operations into the 

interior of the United States and away from the immediate border area. As line-watch and roving patrol 

operations are conducted, traffic checkpoints seek to close off the routes for those illegal activities, 

which, if left unchecked, would pose a significant threat to national security. With the ability to stop and 

question passengers and inspect vehicles for immigration purposes, the Border Patrol is able to employ 

specialized resources to combat terrorism and smuggling activities. Highly trained Border Patrol agents, 

human- and drug-sniffing dogs, radiation alert monitors, and Vehicle and Cargo Inspection Systems 

(VACIS), which is a non-intrusive inspection device, not only provide opportunities to deter alien and drug 

smuggling but also stop other forms of potentially dangerous cargo from entering the interior of the 

United States. 

Management’s Discussion and Analysis 9 
Overview of CBP


During fiscal year 2007, the following border enforcement successes were attributed to Border Patrol 

traffic checkpoint operations: 

• The arrest of more than 23,334 individuals, 

• 3,006 of cases referred for prosecution, and 

• 3,445 narcotic seizures events/incidents (34% of the total Border Patrol narcotic seizures). 

Cooperative Enforcement Efforts—Operation Jump Start (OJS) 

In June 2006, the Border Patrol began a very successful ongoing joint effort—Operation Jump Start 

(OJS)—with the Department of Defense to deploy National Guard members at the Southwest Border. The 

National Guard members perform non–law enforcement surveillance and support operations, providing a 

“bridge” in personnel resources as CBP continues the recruitment effort to increase border security by 

hiring 6,000 additional Border Patrol agents by the end of calendar year 2008. As a result of coordination and cooperation between the Border Patrol and the National Guard Bureau, OJS achieved its overall 

objective of enhancing border security. OJS stands out as an example of what can be accomplished 

through a cooperative and coordinated effort by law enforcement and military forces to protect our 

Nation’s borders. The National Guard members serve as additional eyes and ears for the Border Patrol 

as members of Entry Identification Teams (EITs). The EITs consist of Border Patrol agents and National 

Guard members working hand-in-hand in the detection and identification of illegal activity in border areas. 

The National Guard also provides assistance at Border Patrol traffic checkpoints as vehicle dismantlers 

assisting Border Patrol with the extraction of narcotics from concealed vehicle compartments. National 

Guard members also serve as surveillance camera operators and vehicle maintenance mechanics. 

During fiscal year 2007, the integration of National Guard members into the border security mission 

provided valuable mission support enhancements, for example, 

• EITs and scope operators provided a daily average of 337 miles of expanded border surveillance, 

• Surveillance camera operators provided 26,240 hours of support monthly to monitor surveillance 

cameras, 

• National Guard air assets provided 1,084 hours of aviation support monthly, and 

• National Guard members improved the Border Patrol’s vehicle fleet readiness rate to an average of 

90 percent. 

For fiscal year 2007, National Guard members working in OJS aided in 120,662 alien apprehensions, 

879 vehicle seizures, 241,679 pounds in marijuana seizures, 4,910 pounds in cocaine seizures, 95 alien 

rescues, and a total of $67,985 in currency seizures. 

End of Catch and Release 

On July 14, 2006, DHS announced the end of “catch and release.” In “catch and release,” some aliens, 

usually Other Than Mexicans (OTMs), were released after apprehension. On release, they agreed to 

appear at an immigration court for a hearing at a specified time in the future. Often, the illegal aliens 

would not appear for their hearings and, therefore, became part of the growing illegal alien population in 

10 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


the United States. As releases increased, the rate of illegal entry attempts also increased, especially 

among illegal aliens from Brazil and Honduras. Migration patterns shifted from sector to sector with 

higher release rates. 

A key element of CBP’s ongoing efforts to deter illegal entry is the implementation and expansion of the 

Expedited Removal (ER) program to all Border Patrol sectors. ER is a removal process that requires mandatory detention of select classes of illegal aliens that can be removed from the United States without 

the recourse of an immigration hearing. These include illegal aliens who are present in the United States 

without having been admitted or paroled following inspection by a CBP officer at a designated POE and 

within 100 miles of the U.S. border, and who are unable to establish their physical presence in the 

United States for the 2-week period before the date of encounter. The ER program was expanded to 

include illegal aliens apprehended by Border Patrol on the Southwest Border as of September 14, 2005, 

and later extended to include apprehensions on the Northern Border as of January 30, 2006. As of September 30, 2007, 99.9 percent of aliens apprehended along the Southwest Border and Northern Border 

are now being detained for removal. 

Progressive Enforcement Efforts—Operation Streamline 

Operation Streamline is an ongoing, progressive enforcement effort in the Del Rio Sector that combines 

intensive prosecution with expeditious removal. The effort is a collaboration between personnel and 

resources from CBP’s OBP and Office of the Chief Counsel, Immigration and Customs Enforcement (ICE), 

Office of Detention and Removal, the U.S. Federal courts, the Executive Office for Immigration Review, 

and the U.S. Marshals Service. Based on threat levels and illegal entrant activity assessments in the 

border areas, the Border Patrol focuses resources in designated zones to ensure probability of apprehension, detention, criminal prosecution, prison time, and the ultimate removal of illegal entrants. All aliens 

apprehended within the designated zones are criminally prosecuted for violation of 8 U.S.C. 1325 (illegal 

entry), with a potential sentence of up to 180 days. 

Operation Streamline began December 6, 2005, in Eagle Pass, Texas, along approximately 5 miles of 

border. By the end of June 2006, the Del Rio Sector expanded the operation to cover its entire area of 

operations. Since its inception, the operation has had a dramatic effect on reducing apprehensions 

within the sector. Members of the Del Rio Sector Prosecutions Unit received the “Team DHS Award” 

in 2006 from the Secretary of DHS in recognition of their successful partnership with other Federal 

agencies, as well as their dedicated efforts that resulted in a significant reduction of illegal entries. 

On December 4, 2006, the Yuma Sector implemented an operation similar to the Streamline operation 

along 7 miles of border, which resulted in an initial 15 square miles of entry zones covered by the operation. By June 3, 2007, Yuma Sector expanded its version of the operation to its entire southern border 

with Sonora, Mexico, for a total of 93 miles. Since inception in the Yuma Sector, 100 percent of the 

criminal complaints filed there have been prosecuted. 

Operation Against Smugglers Initiative on Safety and Security (OASISS) 

In March 2005, the United States and Mexico agreed to establish a bilateral standardized prosecution 

program titled Operation Against Smugglers Initiative on Safety and Security (OASISS). OASISS is 

operational at and between the POEs along the California–Baja, California, and Arizona–Sonora borders. 

Management’s Discussion and Analysis 11 
Overview of CBP


Implementation of OASISS began in August 2005, with a total of six POEs and four Border Patrol sectors, 

which expanded to a total of 12 POEs and 7 Border Patrol sectors by the end of fiscal year 2007. 

The OASISS program complements the CBP Strategic Plan and directly supports the OBP National 

Strategy, as well as the Office of Field Operations (OFO) strategic objectives regarding border security. 

In addition, this alien smuggler prosecution program was included as a priority under the Security and 

Prosperity Partnership between the United States and Mexico. The OASISS program is aligning itself with 

the broader Border Safety Initiative, as well as the various enforcement initiatives in the United States 

focused on combating illegal cross-border traffic in the California–Arizona border area. The Government 

of Mexico (GOM), specifically the Mexican Attorney General’s office, is a critical partner in this prosecution program, which is aimed at increasing safety and reducing deaths while targeting alien smugglers 

and human traffickers operating in the immediate border region. Through this program, the GOM prosecutes smugglers and guides who do not meet the prosecution thresholds in the United States. Engaging the GOM in border efforts like OASISS assists CBP in more swiftly gaining control of the border. 

Fiscal year 2007 OASISS results included the following successes: 

• Number of OBP cases generated: 236 

• Number of OBP principals presented to and accepted by the GOM for prosecution: 225 

• Number of OBP cases prosecuted by the GOM: 15 

• Number of OFO cases generated: 26 

• Number of OFO cases presented to and accepted by the GOM for prosecution: 25 

Border Patrol Mexican Liaison Units (MLUs) 

The mission of the Border Patrol Mexican Liaison Units (MLUs) is to create and maintain positive working 

relationships and develop alliances with foreign counterparts. The mission objective is to increase border 

safety and security and further enhance the enforcement duties in direct support of two of the National 

Border Patrol Strategy core elements to build partnerships with other law enforcement agencies and 

increase border awareness. The OBP MLUs are operational in nine Southwest Border sectors. There 

are approximately 34 agents, including the national coordinator at OBP headquarters in Washington, DC, 

and a coordinator at each sector. The units act as a conduit between the OBP and representatives of 

Mexican local, state, and Federal law enforcement agencies located along the Southwest Border. The 

program was designed to support ongoing enforcement operations within their respective agencies while 

enhancing the liaison between them. As our foreign relationships with MLU support have solidified, contact and responses to illicit activity along the border increased, allowing for joint law enforcement support for both sides of our international border. Routine communication and cooperation between some 

sectors and the GOM officials have led to enhancing the security and safety of our agents working in 

dangerous areas along the border. Through the MLU program, information-sharing efforts have allowed 

the Border Patrol sectors to conduct cross-border training initiatives such as bike patrols, all-terrain 

vehicle training, search and rescue training, and vehicle stops. 

12 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


The MLUs are working to standardize policies and procedures and are proactively developing performance measures to evaluate and measure the effectiveness of the MLU program initiatives. 

Border Intelligence Centers (BICs) 

On October 1, 2006, the Border Intelligence Centers (BICs) were established in all Border Patrol sectors. 

The BICs are an innovative tactical intelligence resource center available 24 hours a day, 7 days a week 

to support the Border Patrol mission along our Nation’s border. Originally developed as the Command 

and Control Intelligence Coordination Center in the San Diego Sector, the BICs represent a significant 

enhancement to rapidly collect, analyze, disseminate, and share intelligence information. The mission 

of the BICs is to prevent terrorists and terrorist weapons, smugglers and their contraband, and illegal 

aliens from entering the United States through real-time collection, analysis, and dissemination of 

tactical intelligence. 

The BICs collect and analyze information through the use of databases, operational statistics, other 

agency intelligence reports and interviews with apprehended illegal aliens and smugglers, and the 

employment of geospatial decision support tools. The products of the BICs support the implementation 

of coordinated border enforcement operations, which result in more effective and efficient deployment 

of resources to address evolving threats and vulnerabilities. Actionable intelligence is forwarded to 

decision makers at all levels within OBP, OFO, ICE, and CBP Air and Marine (A&M) and is shared with 

other law enforcement partners. These efforts support CBP’s commitment to become a fully integrated 

intelligence-driven operation. 

Border Security Evaluation Teams (BSETs) 

The Border Security Evaluation Team (BSET) concept was initiated in the Detroit Border Patrol sector in 

fiscal year 2005 and developed as a mechanism for the Northern Border Patrol sectors to evaluate the 

level of border security within the outlying border zones of their sector. Recognized as a “Best Practice” 

at the 2005 Northern Border Patrol Chiefs Conference, the effectiveness of Border Patrol collaboration 

and coordination is exemplified by significant gains in situational awareness on the Northern Border. 

In each of the eight Northern Border sectors, teams of Border Patrol agents are assigned to travel to 

areas within a sector’s area of operation where there are limited Border Patrol resources deployed. 

Team members gather intelligence and establish points-of-contact with state and local law enforcement 

agencies, local civic leaders, and the public to determine whether suspected cross-border activities and 

intelligence indicate a need for deployment of Border Patrol resources in those areas. Interviews and 

reconnaissance efforts are structured toward identifying a cross-border nexus for terrorism and crime. 

The team’s findings are used by the Border Patrol sectors to establish baseline border security levels 

and assist with the sector’s planning process to identify resource requirements in support of the 

National Border Patrol Strategy. 

The effective collaboration and coordination efforts of the Border Patrol with state and local law enforcement agencies, community groups, and citizens has resulted in improved efficiency in the use of 

resources toward gaining control of the border. 

Management’s Discussion and Analysis 13 
Overview of CBP


Operation Red Bull and Operation Uniforce 

The Coastal Sectors of Miami and New Orleans have a long history of encounters with over-the-road 

(OTR) smuggling organizations that specialize in smuggling aliens from the Southwest Border area to 

interior destination points within or beyond their area of operation. The sectors develop intelligencedriven operations targeting smuggled aliens to include terrorists and their weapons, aliens from special 

interest countries, and narcotics from furthering their entry into the United States through the use of 

OTR smuggling organizations. Operation Red Bull was implemented in May 2006 in the Miami Border 

Patrol Sector and is a continuing operation. Operation Uniforce was a 2-week operation in the New 

Orleans Sector that was conducted during February and March 2007. 

The strategic goal of Operations Red Bull and Uniforce includes integrating the disparate Federal, state, 

and local law enforcement efforts that are focused on cross-country, OTR smuggling into a coordinated 

multi-agency, multi-jurisdictional law enforcement effort with a common objective. The desired end-state 

includes an intelligence process that establishes a methodology of linking apprehensions and seizures 

back to the points of origin along the Southwest Border. Armed with this information, the sectors can 

review their current resource deployments, assess this new threat information, and make operational 

adjustments as needed. 

In fiscal year 2007, Operation Red Bull resulted in 721 total apprehensions, of which 714 were traced to 

specific entry zones, with 61 smugglers accepted for prosecution. Operation Uniforce resulted in 407 

total apprehensions, 130 of which were traced to specific entry zones within the Rio Grande Valley 

Sector. Five drivers and three previously deported aliens were criminally prosecuted. 

CBP Air and Marine (A&M) 

CBP Air and Marine (A&M) secures the borders 

against terrorists, acts of terrorism, drug smuggling, and other illegal activity by operating air 

and marine branches at strategic locations 

along the borders. Multi-mission aircraft with 

advanced sensors and communication equipment provide powerful interdiction and mobility 

capabilities directly in support of detecting, 

identifying, and interdicting suspect conveyances, and apprehending suspect terrorists 

and smugglers. CBP A&M maximizes the 

capabilities of air and marine assets through 

a cohesive joint air operations model for centralized command and control and a responsive and integrated control system for decentralized execution. 

CBP A&M works in partnership with numerous stakeholders while performing its missions throughout 

the continental United States and the Western Hemisphere. This includes domestic operations at the 

borders; source, transit, and arrival zone operations; interior law enforcement support; and support 

to other agencies. Truly crosscutting within DHS and the Federal Government as a whole, the unique 

capabilities of CBP A&M serve as both a stand-alone entity and as a force multiplier. In fulfilling the 

CBP A&M on patrol along the U.S. coastal border. 

14 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


priority mission of CBP to protect the borders, our geographical disposition has shifted from a concentration on the Southern Border to include all of our Nation’s borders. 

Container Security Initiative (CSI) 

Containerized shipping is a critical component of global trade because approximately 90 percent of the 

world’s manufactured goods are transported in cargo containers. In the United States, almost half of 

incoming trade (by value) arrives by containers onboard ships. More than 11 million cargo containers 

arrive on ships and are off-loaded at U.S. seaports each year. 

Through CSI, sea cargo containers that pose a risk for terrorism are identified and examined at foreign 

ports before they are shipped to the United States. CBP receives the bill of lading/manifest data on sea 

containers 24 hours before the containers are loaded on the vessel destined for the United States. 

Through partnerships with foreign governments, CSI deploys teams of CBP officials to work with their 

host nation counterparts to screen containers that pose a terrorism risk. CSI extends our zone of 

security outward so that America’s borders are the last line of defense, not the first. 

CSI consists of three core elements: 

1. Using intelligence and automated advance targeting information to identify and target containers that 

pose a risk for terrorism, 

2. Prescreening those containers that pose a risk at the port of departure before they arrive at U.S. 

ports, and 

3. Using state-of-the-art detection technology to scan containers that pose a risk. 

In fiscal year 2007, CSI represented the DHS and worked with the Departments of Energy (DOE) and 

State (DOS) to launch the Secure Freight Initiative (SFI). Whereas CSI targets containers for high-risk 

and possible inspection, the SFI strengthens global supply chain security by scanning 100 percent of 

shipping containers at SFI designated foreign ports for nuclear or radiological materials before they are 

allowed to depart for the United States. SFI is discussed further in the “Looking Ahead” section beginning on page 24. 

At the end of fiscal year 2007, CBP officers began operations at the 58th CSI port overseas. Approximately 86 percent of cargo containers destined for the United States are processed through the 58 

operating CSI ports. 

As of September 30, 2007, 35 foreign administrations have joined or have committed to join the CSI 

program. CBP continues to expand the program to additional ports on the basis of volume, location, and 

strategic concerns. Strong support from countries in Europe, Asia, the Middle East, Africa, North and 

South America, and the Caribbean ensures that CSI will continue to expand to ports in those areas. 

CSI is a reciprocal program that offers participating countries the opportunity to send their customs 

officers to major U.S. ports to target ocean-going containerized cargo being exported to their countries. 

Likewise, CBP shares information on a bilateral basis with its CSI partners. 

Management’s Discussion and Analysis 15 
Overview of CBP


Customs–Trade Partnership Against Terrorism (C-TPAT) 

Customs–Trade Partnership Against Terrorism (C-TPAT) is part of CBP’s extended border strategy to 

protect America against terrorist threats, to protect the global supply chain, and to facilitate trade. 

Under the C-TPAT initiative, CBP partners with importers, carriers, brokers, and other industry sectors to 

enhance supply chain security and meet our twin goals of security and facilitation. Membership entails 

completion of a comprehensive security profile and a commitment to work with CBP to strengthen the 

supply chain. Recent Safety and Accountability for Every (SAFE) Port Act legislation further defines the 

C-TPAT program. SAFE Port Act legislation requires that CBP review and certify submitted security profiles within 90 days and that C-TPAT supply chain security specialists travel worldwide to validate the 

commitments of the certified members and recommend areas for improvement within 1 year of the certification. Certified members currently receive considerable benefits, the two greatest being fewer cargo 

inspections and expedited clearance processes at the border. At the end of FY 2007, there were 7,737 

certified partners, of which 6,003 had been validated successfully complying with the SAFE Port Act. 

C-TPAT provides a mechanism in which the business community and CBP can exchange anti-terrorism 

ideas, concepts, and information; both the government and business communities work together to 

increase the security of the entire commercial process, from manufacture through transportation and 

importation to ultimate distribution. 

Non-Intrusive Inspection (NII) 

CBP has developed a multilayered screening process to identify, target, and inspect high-risk shipments. 

The Automated Targeting System (ATS), a powerful rules-based computer system, is used to automatically review the electronic bill of lading/manifest data of more than 11 million containers before they 

arrive at U.S. POEs, allowing CBP to flag containers that are considered high-risk. Non-Intrusive Inspection (NII) equipment is then used to scan the contents of those containers identified as high-risk or 

selected by CBP officers for further review. 

CBP officers use large-scale NII equipment such as gamma ray and X-ray imaging systems to scan the 

contents of entire containers. These units can scan the interior of a full-size, 40-foot container in less 

than a minute. Some of the currently deployed high-energy X-ray systems can penetrate more than a 

foot of steel. This equipment is very effective at identifying a variety of illegal activity and contraband, 

including human smuggling, narcotics, weapons, and explosives. Large-scale NII equipment is deployed 

at nearly all U.S. land border crossings and seaports. 

CBP uses radiation portal monitors to scan cargo containers for radioactive materials as they pass 

through vehicle-processing lanes at the land border ports or are off-loaded from ships at the seaports. 

Officers also use personal radiation detectors to scan for signs of radioactive materials as they perform 

inspections on smaller vehicles and shipments. Special high-tech tools such as densitometers and fiberoptic scopes allow officers to peer inside suspicious containers. Finally, if necessary, containers are 

opened and unloaded for a more thorough carton-by-carton inspection. 

16 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


Canine Enforcement Teams 

CBP has the largest and most diverse law enforcement canine program in the United States. CBP canine 

officers and Border Patrol agents use specially trained detector dogs to combat terrorist threats; identify 

explosive threats; and interdict concealed persons, currency, agriculture, narcotics, and other contraband at our Nation’s POEs, international mail facilities, and along the border between the POEs. CBP 

detector dogs also perform Border Patrol Search, Trauma, and Rescue missions. 

Canine teams are assigned to 75 POEs and 88 Border Patrol stations throughout the United States. To 

meet both new and growing threats, the CBP canine program has trained and deployed canine teams in 

an array of specialized detection capabilities. CBP has two canine enforcement training facilities, one 

located in Front Royal, Virginia, and one in El Paso, Texas. In fiscal year 2007, more than 700 detector 

dog teams were trained. 

Advance Passenger Information System (APIS) 

Advance Passenger Information System (APIS) is the single-most critical element of the Nation’s ability 

to identify dangerous individuals entering or departing the United States. This system receives biographical and travel document information on passengers arriving and departing by air and sea, and recently 

has been expanded into the land environment for commercial bus and rail operators. Queries look for 

matches with multi-agency law enforcement alerts, immigrant visas, and historical databases before the 

passenger’s arrival in the United States or departure from the United States. CBP receives advance 

information on passengers and crew members sufficient for basic law enforcement queries. CBP issued 

a final rule on August 23, 2007 with an effective date of February 19, 2008 that requires carriers to 

provide APIS data in advance of a passenger boarding the intended aircraft or vessel. This final rule is 

referred to as “APIS Predeparture” and allows CBP to check all travelers against government watch lists 

and to provide a “Cleared” or “Not-Cleared” response to the carrier before a boarding pass can be issued 

to the traveler. 

National Targeting Center—Passenger (NTCP) 

The National Targeting Center—Passenger (NTCP) mission is to provide tactical targeting and analytical 

research support for CBP anti-terrorism efforts, both locally and nationally. The NTCP staff develops 

tactical targets from raw intelligence in support of the CBP mission to detect and prevent terrorists from 

entering the United States. The NTCP provides support to CBP field elements with additional research 

capabilities to assist officers performing passenger examinations by supplying relevant intelligence and/ 

or law enforcement information. This support includes but is not limited to (1) the recommendation of 

admissibility for non-immigrants with known ties to terrorism, (2) verification of terrorist-related visa revocation records and lost or stolen passports, (3) coordination with outside agencies for positive terrorist 

encounters and requests for information, and (4) advance passenger research for International Airport 

personnel working overseas in an effort to identify lookout record matches prior to boarding. NTCP staff 

work closely with its onsite liaison staff to coordinate CBP’s response to Transportation Security Agency 

(TSA) “no-fly” matches, positive Terrorist Identities Datamart Environment matches, and wanted fugitives, to name a few. 

Management’s Discussion and Analysis 17 
Overview of CBP


The NTCP includes representatives from all CBP disciplines, including the OFO, OBP, Intelligence, Laboratory and Scientific Services, and Information and Technology (OIT). Permanent onsite liaisons also have 

been developed with a variety of external organizations, including the USCG, TSA, Office of Intelligence, 

Federal Air Marshals (FAMs), Federal Bureau of Investigation (FBI), ICE, Food and Drug Administration 

(FDA), and DOS. The NTCP strategically enhances U.S. detection and deterrent capabilities by extending 

them into bioterrorism prevention and rapid radiological assessments and provides ongoing targeting 

expertise to the DHS Operations Center. 

National Targeting Center—Cargo (NTCC) 

The National Targeting Center—Cargo (NTCC) began operations on March 26, 2007, and moved to the 

new NTCC facility on May 14, 2007. The NTCC enhances remote targeting operations in support of the 

CSI, supports and coordinates the International Container Scanning (ICS) component of the SFI, and 

supports domestic port targeting. The NTCC uses advanced targeting strategies as well as new tools 

and technologies to enhance CBP cargo-targeting efforts. The NTCC employs a specialized permanent 

and temporary duty staff to provide quality 24/7 tactical and strategic cargo research in all modes. The 

NTCC staff includes CBP officers, agriculture specialists, field analysis specialists, physical scientists, 

intelligence research specialists, and import specialists, as well as personnel representing the FDA, 

Department of Agriculture, and the USCG. 

The NTCC ascertains the nexus of identified terrorists to the cargo environment by identifying passengers entering the United States and looking for any tangible connectivity to cargo through in-depth 

research. The NTCC also creates Memoranda of Information Received documents and enters them into 

the Homeland Enforcement Communications System (HECS) to provide relevant information to all CBP 

officers. The NTCC supports anti-terrorism efforts via the use of the ATS cargo-targeting sweeps. The 

NTCC conducts weapons of mass effect sweeps daily, and subject matter experts analyze the results. 

The NTCC supports the creation and refinement of new ATS rule sets and provides a sound foundation 

for the creation of bioterrorism/agro terrorism countermeasures. The NTCC coordinates with law enforcement agencies and the intelligence community to gather cargo-targeting information, develops field 

expertise for domestic and overseas targeting units via a robust temporary duty program, and supports 

the International Fellowship Program, which is currently in a pilot program with officials from the 

Japanese Customs and Tariff Bureau. 

Fraudulent Document Analysis Unit (FDAU) 

CBP established the Fraudulent Document Analysis Unit (FDAU) to support the removal of fraudulent 

travel documents from circulation. The FDAU serves as a repository for fraudulent travel documents 

confiscated at POEs and provides tactical and strategic intelligence gathered from the seized documents 

to assist in apprehending other ineligible applicants who attempt to enter the United States using fraudulent travel documents. 

18 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


The FDAU has developed a system of accountability for the seizure, destruction, agency use, and return 

of fraudulent documents to the appropriate issuing authorities. In addition, the FDAU conducts link 

analysis and develops tactical intelligence to include strategic targeting on a global scale, which has 

been successful in intercepting inadmissible travelers both prior to and on arrival in the United States. 

The FDAU also generates HECS lookouts, recommends carrier “off-loads” overseas, and liaisons with 

foreign governments to proactively target smuggling operations abroad. The FDAU provides documents 

to DHS components (CBP, ICE, FAMs, USCG), and to other U.S. Government agencies for training in 

fraudulent document detection. 

Admissibility Review Office (ARO) 

CBP created the Admissibility Review Office (ARO) to provide a dedicated resource with institutional 

knowledge and a consistent approach in making determinations of admissibility, inadmissibility, and the 

exercise of discretion for inadmissible aliens under the Immigration and Nationality Act. The ARO works 

extensively with the DOS and other agencies to determine whether inadmissible aliens can legally travel 

as non-immigrants with waivers. Each case requires an assessment of the risk of harm to society if CBP 

admits the alien, which the ARO balances with the alien’s reasons for wanting to travel. 

The ARO currently processes and adjudicates all waivers of inadmissibility that the DOS consular officers 

recommend worldwide and decides all seats of government nonimmigrant waivers. It handles all waiver 

decisions submitted at preclearance POEs. 

Consolidated Trusted Traveler Programs (NEXUS, SENTRI, and FAST) 

The Consolidated Trusted Traveler Program is an umbrella of CBP’s Trusted Traveler Programs, including 

NEXUS, Secure Electronic Network for Travelers Rapid Inspection (SENTRI), and Free and Secure Trade 

(FAST), that uses a common automated system to register program enrollees and perform automated 

identification and validation. The goals of the program are to identify and expedite low-risk travelers and 

free up CBP officers to increase security at the POEs by enabling them to concentrate on high-risk 

travelers. 

NEXUS and SENTRI are land border management processes that provide expedited CBP processing for 

pre-approved, low-risk travelers. Applicants must voluntarily undergo a thorough biographical background 

check against criminal, law enforcement, customs, immigration, and terrorist indices, and participate in a 

personal interview with a CBP officer. Once applicants are approved, they are issued a Radio Frequency 

Identification (RFID) card that will identify their record and status in the CBP database on arrival at the 

U.S. POE. For SENTRI members only, an RFID transponder is also issued for applicants’ vehicles, which 

allows users to have access to specific, dedicated primary lanes for processing into the United States. 

The FAST commercial driver program is the result of the United States, Canada, and Mexico Border 

Partnership Action Plan. The FAST program provides expedited processing of participants’ qualifying 

merchandise in designated traffic lanes at select border sites. 

Management’s Discussion and Analysis 19 
Overview of CBP


US-Visitor and Immigrant Status Indicator Technology (US-VISIT) 

The US-Visitor and Immigrant Status Indicator Technology (US-VISIT) program, launched in 2004, continues to be deployed at many of our land, sea, and air POEs. This system provides CBP officers at primary 

and secondary inspection stations with biometric identifiers such as fingerprints (using an inkless fingerprint scanner) and photographs (using a digital camera) to verify the identity of foreign nationals wishing 

to enter the United States. US-VISIT’s biometric information helps prevent identity fraud by providing 

unalterable, unassailable identity information. It is an integral part of the entry-exit system that provides 

CBP with unique identity information to aid in determining whether someone has remained in the country 

longer than authorized. This system interacts with existing criminal databases that identify people with 

criminal histories and those who may be linked to terrorist activities. 

The US-VISIT ePassport capability was implemented beginning in September 2006 and completed in 

November 2006 covering 97 percent of visa waiver traffic. When the ePassport is scanned, the system 

displays the individual’s biographic data and photograph from the chip on the ePassport to the CBP 

officer, who can then validate that the biographic data match the individual seeking admission. This 

provides an additional level of security to ensure that the passport is authentic and belongs to 

the presenter. 

Automated Commercial Environment (ACE) 

Automated Commercial Environment (ACE) is the modernized U.S. trade processing system designed 

to consolidate and automate cargo processing to significantly enhance border security and foster our 

Nation’s economic security through lawful international trade and travel. Among other capabilities, CBP 

personnel will have automated tools and better information to decide what cargo should be targeted 

because of the potential risk it poses and what cargo should be expedited because it complies with 

U.S. laws before a shipment reaches U.S. borders. 

After September 11, 2001, it became evident that the Federal Government had to establish an interagency ability to ensure a central information clearinghouse with compatible databases of information on 

all aspects of border control. As a result, the scope of ACE was expanded to include all Federal agencies 

with missions tied to international trade and transportation, including related security, regulation, and 

analysis. The International Trade Data System (ITDS) provides a secure, integrated, government-wide 

system to meet the private and Federal requirements for the electronic collection and use of standard 

trade and transportation data by all Federal agencies. The decision was made to use the ITDS requirements, in delivering ACE functionality, to meet the needs of these agencies as well as CBP. The result is 

that ACE, using requirements from ITDS, will provide a “single window” for the electronic submission of 

all trade and transportation data. 

20 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


ACE supports the following major CBP business areas: release processing, entry processing, revenue 

collection, account relationships, legal and policy, enforcement, business intelligence, and risk. It is in 

direct alignment with the President’s Management Agenda (PMA). To maintain this alignment, ACE uses 

e-business technologies whenever possible and is governed by citizens’ needs. ACE also provides 

national account-based processing and periodic monthly statement features that benefit both CBP and 

the trade community as CBP moves away from transaction-by-transaction processing. 

World Customs Organization (WCO) 

In June 2005, the World Customs Organization (WCO) unanimously adopted the SAFE Framework of 

Standards to Secure and Facilitate Global Trade (known as the “Framework”), which seeks to protect the 

global supply chain from the threat of terrorism and transnational crime while simultaneously facilitating 

legitimate trade. 

The Framework seeks to 

• Consolidate advance electronic cargo information requirements, 

• Institute consistent risk management approaches to address security threats, 

• Establish procedures so that the customs administration in the destination country of a shipment 

can request customs in the originating country to conduct an inspection on its behalf, and 

• Define benefits for businesses that meet supply chain security standards and best practices. 

Implementation represents an extraordinary challenge for the customs administration of any country, 

particularly for one that may not have the resources or subject matter expertise readily available to 

implement the practices identified in the Framework. 

Because CBP recognizes that widespread implementation of the Framework substantially contributes to 

the major strategic goals of the agency, CBP is providing capacity-building assistance to 10 countries, 

all of which have demonstrated their commitment to implementation. Such capacity-building assistance 

takes the form of onsite diagnostic assessments, training, and technical assistance on the most salient 

issues appearing in the Framework. In 2006, CBP conducted one in-country diagnostic assessment, the 

last required in the initial phase of assistance. In fiscal year 2007, CBP conducted 32 training missions 

and 5 senior consultations to raise awareness and support for Framework implementation at the highest 

political levels. In addition, CBP participated in a Global Dialogue on Capacity Building, organized in April 

2007 as a forum to increase global donor interest in providing customs-related technical assistance. 

Management’s Discussion and Analysis 21 
Overview of CBP


Budget by Program 

The charts below present a comparison of the fiscal year budgets by major program element for FY 2007 

and FY 2006. These charts are based on direct appropriations received of $8.2 billion in FY 2007 and 

$6.8 billion in FY 2006. Direct appropriations equal total entity appropriations of $6.7 billion during 

FY 2007 and $5.4 billion during FY 2006 shown on the Consolidated Statement of Changes in Net 

Position, plus $1.5 billion and $1.4 billion in Merchandise Processing Fees transferred to and used for 

Salaries and Expenses during FY 2007 and FY 2006, respectively. 

FY 2006 

Security Between NII Ports of Entry 1% 48%


C-TPAT


1%


CSI


2%


Security at 

Ports of Entry Other 

30% 4% 

Air & Marine 

Operations 

7% 

ACE


7%


FY 2007 

Security Between NII Ports of Entry 

C-TPAT & 3% 36% ACE 

FAST/NEXUS/ 6% 

SENTRI


1%


Air & Marine 

CSI Operations 

2% 

Other 

3% 

8% 

Security at Border 

Ports of Entry Security Fencing, 

26% Infrastructure & Technology 

15% 

22 U .S ..Customs.and.Border.Protection.•.Performance.and.Accountability.Report 
Overview of CBP


Budget Resource Obligations 

The charts below present a comparison of the distribution of CBP budget resource obligations for 

FY 2007 and FY 2006. These charts are based on current year, entity obligations totaling $9.2 billion in 

FY 2007 and $7.2 billion in FY 2006. These totals do not include non-entity obligations and obligations 

related to prior year appropriations totaling $3.3 billion during FY 2007 and $3.1 billion during FY 2006 

included in the Consolidated Statement of Budgetary Resources obligations totals of $12.5 billion and 

$10.3 billion for FY 2007 and FY 2006, respectively. 

FY 2007 

Salaries & 

Expenses 

Reimbursable 

15% 

Modernization 

5% 

Other 

1% 

Salaries & 

Expenses Direct 

65% 

Facilities 

Operations & 4%

Maintenance 

5% 

Border Security Fencing, 

Infrastructure & 

Technology 

5% 

FY 2006 

Salaries & 

Expenses 

Reimbursable 

16% 

Modernization 

7% 

Other 

1% 

Salaries & 

Expenses Direct 

65% 

Facilities 

6% Operations & 

Maintenance 

5% 

Management’s Discussion and Analysis 23 
Overview of CBP


Looking Ahead 

CBP will continue to expand and enhance the major programs previously discussed along with new 

initiatives and enhancements. 

Secure Freight Initiative (SFI) 

CBP personnel preparing to offload containers for scanning. 

The Secure Freight Initiative (SFI) is a joint effort 

of DHS, represented by CBP and DOE to fulfill the 

requirements set out by Congress in the SAFE 

Port Act of 2006. By October 13, 2007, the Act 

required SFI to establish three ports in key locations around the world with pilot integrated scanning systems. Under the initiative, which works 

closely with and through CSI (discussed in the 

“Management Discussion and Analysis” section 

beginning on page 5), the capability to scan 

100 percent of all cargo bound for the United 

States with radiation detection and NII equipment 

and to provide the data from these systems to U.S. officials at the National Targeting Center (NTC) for 

analysis will be evaluated. 

The SFI successfully began operations at the three pilot ports on schedule. Operational testing of secure 

freight equipment began at Puerto Cortés, Honduras, on April 2, 2007. In partnership with the Government of Pakistan, SFI began transmitting data from a new radiation scanning system in Port Qasim on 

April 30, 2007. Integrated scanning of U.S.-bound containers at the third port, Southampton, United 

Kingdom, began in early October 2007. 

In addition to the three pilot ports required by the SAFE Port Act, SFI added four additional ports to the 

evaluation to help determine the impact of scanning at large-volume ports, as well as at ports where a 

large number of transshipments are processed. SFI will conduct radiation scanning on a limited capacity 

basis: Singapore’s Brani terminal; Busan, South Korea’s Gamman terminal; Hong Kong’s Modern Terminal; and Port Salalah, Oman. 

In addition to being a preventive tool in the Global War on Terror that will make borders safer and will 

increase the economic efficiency of exports, SFI will also increase the security of the international supply 

chain for shippers and will promote close cooperation between the United States and foreign customs 

administrations. 

The testing of full-scale radiation scanning and X-ray imaging at these foreign ports, with near real-time 

data transmission to the host government and resources in the United States, will assist in developing 

the next generation of technology to expand border security and strengthen the global supply chain. 

Phase I results will provide guidance on future port expansion. 

24 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


Western Hemisphere Travel Initiative (WHTI) 

The Intelligence Reform and Terrorism Prevention Act of 2004 requires DHS and DOS to develop and 

implement a plan to require all travelers—U.S. citizens and foreign nationals alike—to present a 

passport or other acceptable document that denotes identity and citizenship when entering the United 

States. Congress amended portions of the Act in 2006. The Western Hemisphere Travel Initiative (WHTI) 

is the joint DHS and DOS plan to implement the September 11th Commission’s recommendation and 

congressional mandate. 

The goal of WHTI is to strengthen border security and facilitate entry into the United States for U.S. citizens and legitimate international visitors. WHTI was successfully implemented for air travel on January 

23, 2007, and has maintained an extremely high compliance rate. U.S. and Canadian citizens entering 

the United States across the land borders are not currently required to carry or present identity and 

citizenship documents, making it difficult to verify that people are who they say they are. 

The passport issued to international standards is the document of choice because of its security 

features, compatibility with current infrastructure in the Nation’s airports and seaports, and use of international standards and interoperability with all other countries. CBP is collaborating with the DOS in the 

development of the passport card for U.S. citizens to use at the land borders. This document will be 

available in a card format, will use advanced technology, including RFID, to facilitate the primary inspection process, and will cost less than the standard U.S. passport book. RFID has been used successfully 

along our land borders with Canada and Mexico since 1995. Through Trusted Traveler Programs, such as 

NEXUS, SENTRI, and FAST, U.S. border officials are able to expedite legitimate cross-border travel and 

trade. Membership in these programs currently exceeds 368,000 travelers. 

CBP has entered into an agreement with the State of Washington on a pilot project to produce enhanced 

drivers licenses that would meet the requirements of WHTI for border crossing. Discussions are underway with other states and Canadian provinces for exploring this option as a viable WHTI solution. 

US-VISIT—10-Print 

In fiscal year 2007, the US-VISIT program began to move forward with the development of a 10-fingerprint 

(10-print) capability at CBP POEs. The 10-print biometric print will further our efforts to prevent identity 

fraud by providing unalterable, unassailable identity information. It is an integral part of the entry-exit 

system that provides CBP with unique identity information to aid in determining whether someone has 

remained in the country longer than authorized. This system interacts with existing criminal databases 

that identify people with criminal histories and those who may be linked to terrorist activities. 

Management’s Discussion and Analysis 25 
Overview of CBP


Unmanned Aircraft System (UAS) 

Beginning in November 2004, CBP conducted test programs using unmanned aircraft for surveillance 

missions along the U.S.–Mexico border in Arizona. The test results were very positive, and CBP initiated 

the Unmanned Aircraft System (UAS) in 2005. The UAS provides an efficient and reliable supplement to 

existing detection and intelligence-gathering technologies. Unmanned aircraft have a significant advantage over manned aircraft, with the capability to fly for more than 30 hours without refueling. This technology has proven highly successful in supporting existing manned aircraft, maintaining current ground 

assets, and monitoring remote portions of the border that are often difficult to reach safely or are unable 

to accommodate infrastructure devices. Since the start of operations in 2004, UASs have been instrumental in the apprehension of undocumented aliens, the seizure of drugs, and the recovery of stolen 

vehicles. UASs have proven effective in locating subjects during hours of darkness and providing an 

unparalleled situational awareness and officer safety capability. 

UASs will continue to be used in securing the border of the United States by providing strategic intelligence, surveillance, and interdiction support. CBP was the first Federal law enforcement agency to fly 

unmanned aircraft on a sustained basis, outside of controlled airspace, within the United States. UAS 

operations will expand as additional systems are delivered to the Southwest Border, deployed for test 

and evaluation to the Northern Border, and re-outfitted with maritime search radars for test and evaluation in the Southeast Coastal area of responsibility. 

Summary 

CBP will continue to integrate state-of-the-art technologies and traditional security infrastructures at 

U.S. POEs and along our borders and work in collaboration and partnership with the trade community 

and foreign governments to secure our country from terrorists and terrorist weapons while facilitating 

world commerce. 

26 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


Organization 

U.S. Customs and Border Protection 

Commissioner 

Deputy Commissioner 

Chief of 

Staff 

Information 

& Technology 

Chief 

Counsel 

Secure 

Border 

Initiative 

Secure 

Freight 

Initiative 

Finance 

Human 

Resources 

Management 

Training & 

Development 

Congressional 

Affairs 

Internal 

Affairs Intelligence International Affairs 

Equal 

Employment 

Opportunity 

Anti-Terrorism Policy & 

Planning 

Public 

Affairs 

Customs & Border 

Protection 

Air & Marine 

Assistant Commissioner 

International Trade 

Assistant Commissioner 

Field Operations 

Assistant 

Commissioner 

Border Patrol 

Chief 

Management’s Discussion and Analysis 27 
Overview of CBP


Headquarters 

Office of the Commissioner: W. Ralph Basham was sworn in by President George W. Bush on June 6, 

2006, to serve as the second Commissioner of U.S. Customs and Border Protection, the agency of DHS 

responsible for managing, controlling, and securing our Nation’s borders. As Commissioner, Mr. Basham 

advances CBP’s priority mission of preventing terrorists and terrorist weapons from entering the United 

States while facilitating legitimate trade and travel. 

Office of the Deputy Commissioner: Jayson P. Ahern was appointed Deputy Commissioner, CBP, in 

August 2007. As Deputy Commissioner, Mr. Ahern is responsible for providing leadership and executivelevel direction to CBP’s day-to-day operations. This includes oversight of agency initiatives that facilitate 

the international movement of legitimate, low-risk goods and travelers while promoting effective border 

security. 

Component Organizations and Field Structure 

CBP is organized into 19 separate offices, each of which reports directly to the Commissioner. The 

mission of each office is described briefly below: 

Office of Anti-Terrorism (OAT): Serves as the principal adviser to the Commissioner and other senior officials on CBP anti-terrorism programs. To meet CBP’s mission, OAT monitors, coordinates, recommends, 

assesses, and participates in the development of all policy, programs, training, and matters related to 

anti-terrorism. OAT maximizes CBP’s anti-terrorism efforts by leveraging and working within the broader 

Federal law enforcement community and homeland security structure. OAT provides anti-terrorism expertise and supporting policy development, while serving as a focal point for interaction and cooperation 

with the interagency community on terrorism-related issues. OAT, in conjunction with CBP’s operational 

offices, coordinates incident management operations, heightened threat responses, and counter-drug 

activities, while providing information and situational awareness to the Commissioner and other senior 

officials through round-the-clock management of the Commissioner’s Situation Room. 

Office of Equal Employment Opportunity (EEO): Establishes policies and programs necessary to ensure 

compliance with the civil rights laws. The EEO office works aggressively to find solutions to workplace 

disputes through proactive training, early intervention, and mediation. 

Office of Intelligence (OINT): Serves as the primary adviser on intelligence matters. OINT is responsible 

for directly supporting the Commissioner and senior CBP leadership by obtaining, analyzing, and disseminating intelligence in a timely manner to assist CBP in carrying out its primary mission of detecting, identifying, and preventing terrorists and terrorist weapons from entering the United States. OINT directs and 

efficiently manages an integrated intelligence capability that ensures that frontline operators and senior 

leadership have the value-added intelligence required to drive operations and support policy. Finally, 

through membership on the Homeland Security Intelligence Council, OINT’s responsibility is to represent 

CBP’s intelligence interests to the DHS Chief Intelligence Officer and assist in directing the DHS intelligence enterprise in providing “one DHS face” to the National Intelligence Community. 

28 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


Office of Policy and Planning (OPP): Advises the executive staff on policy development and implementation in the broad array of issues addressed by CBP, including national border security policy, immigration 

enforcement, cargo security and facilitation, agriculture protection, interagency coordination, and legislation. The office further coordinates with individual offices and programs inside and outside the agency to 

develop specific strategies and planning guidance that support the CBP mission. This includes managing 

the strategic planning process and performance measurement requirements related to the Government 

Performance and Results Act (GPRA), the Performance Assessment Rating Tool (PART), and the President’s Management Agenda (PMA). In addition to the policy and planning activities of the office, OPP 

serves as the central coordination point for congressional reporting and all matters under review or audit 

by the Government Accountability Office (GAO) and the DHS Office of the Inspector General (OIG). 

Office of International Trade (OT): Provides the unified strategic direction for trade policy and facilitation, 

program development, and enforcement response functions in CBP. Established in fiscal year 2007 to 

consolidate trade policy and program development functions, OT directs national enforcement responses 

through effective targeting of goods crossing the border, as well as strict, swift punitive actions against 

companies participating in predatory trade practices, including textile transshipment and intellectual 

property rights infringement. Through coordination with international partners and other U.S. Government 

agencies, OT directs CBP risk-based programs designed to detect and prevent the importation of contaminated agricultural products, goods that present health and safety risks, and products requiring protection from unfair trade practices. OT is also an agency leader in promoting trade facilitation through 

partnership programs. OT streamlines the flow of legitimate shipments and fosters corporate selfgovernance as a means of achieving compliance with trade laws, regulations, and international trade 

agreements. A risk-based audit program is used to respond to allegations of commercial fraud and to 

conduct corporate reviews of internal controls to ensure that importers comply with trade laws and 

regulations. Finally, OT provides the legal tools to promote facilitation and compliance with customs, 

trade, and border security requirements through the issuance of CBP regulations, binding rulings and 

decisions, informed compliance publications, and structured training and outreach on international trade 

laws and CBP regulations. 

Office of Secure Border Initiative (SBI): Is accountable for the development and oversight of the SBInet 

technology and tactical infrastructure programs, as well as CBP’s transportation programs. Established 

in fiscal year 2007, the SBI office provides CBP-wide coordination, analysis, and integration of SBI-related 

programs and activities. In addition, SBI serves as an integrator and a facilitator for border security 

programs and activities, particularly those that impact multiple CBP organizations or require strategic 

coordination and perspective. 

Office of Secure Freight Initiative (SFI): Works to raise domestic and international maritime security and 

strengthen foreign port capabilities to detect and interdict maritime threats. Established in fiscal year 

2007, SFI develops and uses a global detection network that enables real-time communication of container images and radiological detection data to the United States from other countries engaged in 

maritime security. 

Office of CBP Air and Marine (A&M): Protects the American people and Nation’s critical infrastructure 

through the coordinated use of integrated air and marine forces to detect, interdict, and prevent acts of 

terrorism and the unlawful movement of people, illegal drugs, and other contraband toward or across the 

borders of the United States. CBP A&M’s core competencies include air and marine interdiction, air and 

Management’s Discussion and Analysis 29 
Overview of CBP


marine law enforcement, and air and national border domain security. CBP A&M further supports DHS 

missions, such as response and recovery to natural disasters and terrorism. 

Office of Border Patrol (OBP): Serves as the CBP law enforcement organization with the primary responsibility for preventing terrorists, weapons of terrorism, illegal aliens, drugs, and those who smuggle them 

from entering the United States between the POEs. The Border Patrol is organized into 20 sectors along 

the southwestern, northern, and coastal areas of the United States. 

Office of Chief Counsel (OCC): Serves as the chief legal officer of CBP and reports to the General 

Counsel of DHS. The Chief Counsel serves as the Ethics Officer for the organization and is the principal 

legal advisor to the Commissioner of CBP and its officers. The OCC provides legal advice to and legal 

representation of CBP in matters relating to the activities and functions of CBP. 

Office of Congressional Affairs (OCA): Advises CBP managers on legislative and congressional matters 

and assists Members of Congress and their staffs in understanding current and proposed CBP 

programs. 

Office of Field Operations (OFO): Enforces customs, immigration, and agriculture laws and regulations 

at U.S. borders and has the primary responsibility for preventing terrorists and terrorist weapons from 

entering the United States at the POEs. OFO maintains programs at 20 field operations offices; 327 

POEs, which include 15 pre-clearance stations in Canada, the Caribbean, and Ireland; and 58 Container 

Security Initiative ports worldwide. A Director of Field Operations heads each field operations office. Port 

Directors oversee POEs in their operational areas, where virtually all conveyances, passengers, and 

goods legally enter and exit the United States. OFO oversees the enforcement of laws and regulations 

while ensuring the safe and efficient flow of goods and people through the POEs. 

Office of Finance (OF) and Chief Financial Officer (CFO): Oversees all financial operations, procurement, 

asset management, and budget activities within CBP. OF is responsible for administering $11 billion that 

is budgeted annually for law enforcement and trade operations and collecting more than $33 billion in 

custodial and entity revenue annually. This office is responsible for administering the broad range of 

financial management activities delineated under the CFO Act of 1990, including accounting, budgeting, 

procurement, asset management, financial systems, and financial management. 

Office of Human Resources Management (HRM): Provides human resources support by filling positions, 

offering employee services and benefits, processing personnel actions, improving business processes, 

and facilitating workforce effectiveness. HRM also promotes and enables mission accomplishment 

through human capital planning and utilization, strategic leadership, labor–management relations, and 

employee safety. 

Office of Information and Technology (OIT): Provides CBP with information, services, and technology 

solutions to secure the border, prevent the entry of terrorists or terrorist weapons, and facilitate legitimate trade and travel. In addition, OIT operates a round-the-clock secure, stable, and high-performance 

Information Technology (IT) infrastructure and supports tactical communications, scientific solutions, and 

forensic services. OIT implements and supports CBP’s information technology, automation, and technology strategies. OIT personnel manage all computers and related resources, including all operational 

aspects of the Computer Security Program. OIT also establishes requirements for computer interfaces 

30 U .S . Customs and Border Protection • Performance and Accountability Report 
Overview of CBP


between CBP and various trade groups and government agencies, and manages matters related to automated import processing and systems development. 

Office of International Affairs and Trade Relations (INATR): Facilitates and supports all international programs, activities, and foreign initiatives for CBP. Reorganized in fiscal year 2007, INATR also conducts 

outreach to and serves as a resource for the international trade community on a range of CBP policy 

issues. INATR works with our international partners to implement programs and initiatives to combat 

international terrorism and to extend our borders. INATR achieves these objectives by developing and 

maintaining collaborative relations with foreign governments, devising international strategies, advocating CBP positions in international forums, delivering international technical assistance and training, and 

supporting the negotiation of international agreements. 

Office of Internal Affairs (IA): Exercises oversight authority for all aspects of CBP operations, personnel, 

and facilities. IA is responsible for ensuring compliance with all bureau-wide programs and policies relating to corruption, misconduct, or mismanagement; investigating misconduct by CBP employees; and executing the internal security, integrity, and management self-inspection program. IA conducts personnel 

security investigations, educates employees concerning ethical standards and integrity responsibilities, 

evaluates physical security threats to CBP facilities and sensitive information, and inspects CBP operations and processes for managerial effectiveness and improvements. 

Office of Public Affairs (OPA): Communicates CBP’s mission and operations to the agency’s chief stakeholders, which include the American public, foreign nationals who conduct business in the United States, 

international trade entities, and travelers who cross U.S. borders. Tools used in the national and international public communication process include media outreach and public information campaigns conducted via media events, video, photography, and informational brochures. In addition, CBP maintains a 

public Web site—www.cbp.gov—and a national customer service call center to address public questions 

and complaints. OPA also keeps the CBP workforce informed through the CBPnet Intranet site, the 

weekly e-mailed news compilation “Frontline News,” and mass e-mails. A bimonthly newsletter, “CBP 

Today,” is distributed to CBP personnel and other stakeholders nationwide. 

Office of Training and Development (OTD): Leads and directs CBP’s training programs. OTD ensures that 

all training efforts support the CBP mission and strategic goals, meet the needs of a diverse and geographically dispersed workforce, and contribute to measurable outcomes and results. OTD establishes 

standards for designing, developing, delivering, and evaluating training. The office directly executes career 

development programs; basic and advanced training to all occupations; and supervisory, management, 

and executive development programs. 

Management’s Discussion and Analysis 31 
n 

a

i

Marfa 

Van 

 Horn Sierra Blanca 

Fabens 

Curlew 

Metaline 

Bonners Ferry 

Eureka 

Saint Mary 

Boittineau 

Ft. Hancock 

El Paso 

Santa Teresa 

Columbus 

Douglas 

Nogales 

Naco 

Sasabe 

Lukeville 

San Luis 

Calexico Andrade 

Campo Boulevard 

Tecate Otay Mesa 

Brown Field 

Chula Vista 

Valdez 

Wrangel l

Ketchikan 

Sitka 

Dalton Cache 

Oroville 

Nighthawk 

Sumas Lynden 

Blaine 

Point Roberts 

Friday Harbor 

Ferry 

Danville 

Laurier 

Frontier 

Boundary 

Porthil l

Eastport 

Roosville 

Peigan 

Del Bonita 

Sweetgrass 

Whitlash 

Turner 

Morgan 

Opheim 

Scobey 

Raymond 

Fortuna 

Noonan 

Portal 

Sherwood 

Westhope 

Hannah 

Northgate 

Antler 

Carbury 

Dunseith 

St. John 

Sarles 

Maida 

Whiteail 

Ambrose 

Hansboro 

EL PASO 

PACIFIC	 MOUNTAIN 

1 

2 

BLAINE ALASKA SECTOR 12 SPOKANE

SECTOR 

HAVRE Fairbanks Neah Bay SECTOR Port Angeles Bellingham GRA Anacortes Anchorage Alcan Port Townsend Puget Everett

Skagway Sound Seattle Tacoma Juneau Seattle-Tacoma Colville Aberdeen Kodiak Olympia Airport 

Wenatchee Whitefish 

Spokane Shelby Havre 

Astoria Longview Plentywood 

Pasco Malta 

Portland Great Falls 

Newport 

HAWAII	 Gran SEATTLE Nawiliwili-Port Allen Butte
 Coos Bay


Kahului	 PORTLAND Billings Honolulu 

10 

Hilo/Kona Boise 

Eureka 

Twin Falls 

GUAM	 Casper 

Tamuning SAN FRANCISCO Reno	 Salt Lake City 

7 

San Francisco- Sacramento


Oakland


San Jose Denver 

San Luis Obispo	 Las Vegas 

W LOS ANGELES 

Los Angeles 

Port Hueneme AMOC 

Riverside Long Beach EL PASO Temecula Indio TUCSON San Clemente Blythe 

SAN DIEGO Oceanside Albuquerque Amarillo O 

San Diego El Cajon El 

Imperial Beach Centro Phoenix 

San Ysidro Wellton Truth or 

Casa Grande Silver City Consequences 

YumaCamp Grip SAN DIEGO Ajo Tucson	 Lubbock 

Deming SECTOR Willcox Lordsburg Las Cruces 

Alamagordo HOUST Artesia Sonoita EL CENTRO Sierra Vista Carlsbad Abilene 

SECTOR Ysleta 

YUMA Pecos Midland 

SECTOR Fort Stockton San Angelo 

TUCSON LAREDO Llano 

Alpine SECTOR Rocksprings A Sanderson 

SECTOR Presidio Comstock 

Del Rio Uvalde 

LEGEND Bracketville San Anton Big Bend 

MARFA Cotulla Eagle Pass 

Carrizo Springs 

SECTOR	 P 

CBP Headquarters	 CBP Air & Marine OBP Sector Headquarters Laredo North Freer 

Operations Center DEL RIO Laredo South Hebbronville 

Field Office Border Patrol Station	 F Zapata CBP Air Location SECTOR Roma Port of Entry Border Patrol Sector	 Falcon Dam

Rio Grande City 

McAllen 

Training Facility CBP Marine Location Boundary 	 LAREDO Hidalgo

Weslaco 

$	 National Finance State Boundaries Time Zones SECTOR Harlinge 

Center (NFC) 

Overview of CBP 

32 U S ..Customs.and.Border.Protection.•.Performance.and.Accountability.Report 
n

W

a

P

i

Champlain BP

Wellesley Island 

Beecher Fall

Newport 

Niagra Falls 

Sodus Point 

Rochester 

Oswego 

Cape Vincent 

Alexandria Bay 

Watertown 

Brooklyn 

JFK Airport 

ondon 

aven 

port 

idence 

ewport 

Ogdensburg 

Massena 

Trout River 

Burke 

Champlain-Rouses Poin

Highgate Spring

i

Derby Lin

Norto

Jac

l

Warroad 

Nech

Pembi

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N

Br

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Pro

N

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kman 

Roseau 

Baudette 

d Portage 

s- nier 

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Walhal a 

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ew H

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n

ine Creek 

Gran

International Fal Ra

S

t 

s Alburg 

R chfor

P

d SECTOR 

NEW OR EL ANS 

BUF AF LO 

New York 

CENTRAL	 EASTERN 

OBP SECTOR REFERENCE MAP BLAINE 

SECTOR SPOKANE 

SECTOR HAVRE 

SECTOR GRAND FORKS 

SECTOR 

SWANTON 

3	 SECTOR HOULTON 

DETROIT SECTOR 

SECTOR 

4 

BUFFALO 

SECTOR 

SAN DIEGO 

SECTOR 

EL CENTRO 

SECTOR YUMA 

SECTOR TUCSON 

SECTOR MIAMI EL PASO SECTOR SECTOR 

SECTOR NEW ORLEANS RAMEY 

SECTOR SECTOR AND FORKS DEL RIO

MARFA 

SECTOR RIO GRANDE 

VALLEY SECTOR LAREDO 

SECTOR SECTOR 

Madawaska Van Buren 

SWANTON Limestone Fort 

Kent Fort Fairfield 

Bridgewater HOULTON Houlton Vanceboro 

DETROIT Calais SECTOR Bangor SECTOR Grand Marais Eastport

Lubec d Forks Rangeley Jonesport 

Bar Harbor BUFFALO Belfast 

Duluth Sault Ste Marie SECTOR Rockland

Fargo Ashland Swanton Bath Plattsburgh Burlington Portland

Marinette 

DETROIT Utica BOSTONPortsmouth

Clayton Lawrence 

Gloucester Minneapolis- Green Bay 

St. Paul Albany Salem 

Worcester Boston Manitowac Springfield Plymouth Muskegon Saginaw-Bay City Marysville 

Flint Sheboygan Fall River Buffalo New Bedford Syracuse Grand Rapids Port Huron Hartford Milwaukee Sioux Falls Detroit Racine Metro Airport Wilkes-Barre/

Battle Scranton Erie Creek Trenton Newark Conneaut- Rockford Perth Amboy Ashtabula CHICAGO Chicago 

Sandusky Toledo- Cleveland BALTIMORE Lehig

Valley
 NEW YORK Des Moines
 Philadelphia 

Harrisburg Chester/Wilmington


Davenport/Rock Island/Moline Pittsburgh


Omaha
 Columbus Harpers Ferry 

Peoria $ Dayton Front Royal Baltimore	

Annapolis CBP PRECLEARANCE Washington/Dulles Washington, DC HEADQUARTERS STATIONS Lawrenceburg Cambridge St. Joseph Indianapolis Cincinnati-


Alexandria


Kansas City	 ARUBA 

St. Louis Louisville Charleston 

Spirit of St. Louis Airport Evansville/ Richmond- Newport News BAHAMAS Owensboro	 Petersburg Norfolk Freeport

 Nassau ichita 

Springfield Tri-Cities Winston-Salem Raleigh-Durham BERMUDA 

Knoxville CANADA Tulsa	 Nashville Charlotte ATLANTA Beaufort-Morehead City Calgary

OKC Training Center Memphis Chattanooga Greenville- Edmonton

klahoma City Spartanburg Wilmington Halifax

Huntsville	 Montreal

Little Rock Columbia	 Ottawa Georgetown 

Greenville Birmingham Atlanta Toronto

 Vancouver

TON NEW ORLEANS Charleston Victoria

Winnipeg 

Dallas/Fort Worth Vicksburg	 Savannah 

Shreveport-Bossier City FLETC IRELAND

Brunswick Dublin

 Shannon Fernandina Beach 

Mobile Jacksonville Gulfport	 P3 OPS 

ustin Baton Rouge Hammond 

Pascagoula Pensacola	

Orange	 St. Augustine MIAMI Panama City Beaumont Gramercy TAMPA
 Houston
 Port Lake Lafayette New Orleans	 Arthur Charles Sanford
 SECTOR Sabine
 Port Canaveral


Morgan City


o Galveston	 Port Manatee 

Orlando Freeport CARIBBEAN AREA St. Petersburg Tampa Ft. Pierce	 EASTERN time during Spring/Summer 3 OPS Port Lavaca-Point Comfort RAMEY Corpus Christi SECTOR	 Sarasota SECTOR West Palm Beach ATLANTIC time SAN JUAN during Fall/Winter Kingsville Ft. Lauderdale/	 San Juan

lfurrias RIO GRANDE Ft. Myers Port Everglades	 Seaport & Airport Coral Bay

Miami Seaport & Airport Aguadilla Charlotte Cruz Bay


Progreso Pembroke Pines Ramey CAMOC Fajardo Amalie


Rio Grande Valley Homestead Mayaguez


VALLEY SECTOR	 MIAMI 

Key Largo Boquerón Ponce n Brownsville Fort Brown Frederiksted Marathon 

Key West 

Revised 05/07 

Overview of CBP


Management’s.Discussion.and.Analysis 33 
Performance Goals and Results


In fiscal year 2007, CBP made significant progress toward achieving the long-term goals set forth in the 

Strategic Plan for Fiscal Years 2005–2010. Agency progress is described in this Performance and 

Accountability Report (PAR). The information is set forth in the context of the Government Performance 

and Results Act of 1993, which requires Federal agencies to develop and implement processes to plan 

for and measure mission performance. Since the first full year of CBP operations occurred in fiscal year 

2004, four full years of data are not available for trend analysis. 

Performance.Management 

The CBP comprehensive strategic planning process is driven by the need to address the global challenges to secure the Homeland and the Nation’s economic security. The CBP Strategic Plan is based 

on the priorities that were established and articulated by the Secretary of Homeland Security and the 

Commissioner of CBP. The Strategic Plan is prepared with input from senior managers to reflect these 

priorities and supports the CBP budget submission. The development process has considered the DHS 

Strategic Plan, the National Strategy for Homeland Security, the National Money Laundering Strategy, 

the National Drug Control Strategy, Presidential Directives on National Security, and Executive Orders. 

In addition, the President’s Management Agenda (PMA), budget justification materials, internal strategic 

planning initiatives and the DHS Future Year Homeland Security Program (FYHSP), used for formulating, 

analyzing, and reporting the DHS planning and budgeting process, were considered. Finally, evaluations 

conducted through the GAO, the DHS OIG and the Performance Assessment Rating Tool (PART) processes have also been assessed. 

The CBP strategic planning framework is organized as follows: 

• Strategic Goal—A high-level statement of what needs to be achieved 

• Objectives—Specific statements of what is to be accomplished within the goal 

• Strategies—Specific actions that are to be taken to reach an objective 

• Performance Measures—What will be accomplished by carrying out the strategies 

Each strategic goal is presented using the CBP strategic planning framework and has been determined 

based on future assumptions, previous accomplishments, and the need to integrate diverse CBP 

responsibilities effectively. The goals are further linked to specific objectives and strategies, as well as 

performance measures that are used to evaluate progress toward achieving the goals. This strategic 

planning process has resulted in the formulation of six strategic goals and associated objectives and 

measurements. 

34 U .S ..Customs.and.Border.Protection.•.Performance.and.Accountability.Report 
Performance Goals and Results


Fiscal Year 2007 Performance by Strategic Goal 

This section presents a discussion of highlighted fiscal year 2007 performance objectives and related 

key performance measures for each of CBP’s strategic goals. Additional performance measures and 

results can be found in the “Performance” section under “Performance Summary,” beginning on 

page 66. 

Strategic Goal #1—Preventing Terrorism at the Ports of Entry 

CBP uses non-intrusive imaging technology to inspect the 

contents of a truck at the port of entry. 

To achieve this strategic goal, CBP implements the 

strategic plans for preventing terrorists and terrorist 

weapons from entering the United States. Through 

improved targeting and intelligence, CBP targets 

and interdicts terrorists and their weapons at the 

POEs. Through various programs, CBP screens and 

examines passengers, cargo, and conveyances 

posing a potentially high risk for terrorism prior to 

departing foreign ports for the United States. To 

protect legitimate travel, trade, and the economy, 

CBP will extend its zone of security beyond the 

physical borders of the United States by stationing 

its offices in foreign countries and by partnering 

with international entities and the trade community. 

Performance Objective—Improve identification and targeting of potential terrorists and terrorist weapons 

through risk management and automated advance and enhanced information. 

To improve targeting of cargo and passengers that pose a potential risk for terrorism, CBP will continue 

to use advance passenger and cargo information, as well as commercial and law enforcement databases, to prescreen, target, and identify potential terrorists and terrorist shipments and any related 

activity. To improve targeting and analysis, CBP will integrate existing databases and enhance its rulesbased targeting system. 

Management’s Discussion and Analysis 35 
Performance Goals and Results


Performance Measure—Number of foreign cargo examinations resolved in cooperation with the Container 

Security Initiative (CSI). 

Description: The number of container examinations processed or mitigated by foreign customs 

officials that were identified by CBP CSI as higher-risk and accepted as meeting CBP 

examination standards and requirements. This measure provides an indicator of the 

benefit of locating CBP Officers at foreign locations that are cooperating with CBP 

under CSI. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 2,400 25,222 30,332 31,000 18,438 

Explanation of 

FY 2007 Results: 

Target Not Met—The CSI Program added eight ports to the program during FY 2007, 

bringing the total number to 58 foreign ports. The increased collaboration of foreign 

and collocated CSI customs personnel at foreign ports reflected by this proxy 

measure supports the goal of targeting, screening, and apprehending high-risk 

international cargo and travelers to prevent terrorist attacks, while providing 

processes to facilitate the flow of safe and legitimate trade and travel. CSI teams’ 

container targeting effectiveness improved in FY 2007 such that the number of 

containers that required assistance by host nation intelligence to mitigate high-risk 

shipments decreased dramatically. 

Recommended Action: The reduction observed for this measure in FY 2007 was the result of significant 

efficiency improvements in Automated Targeting System (ATS) targeting algorithms 

and increased use of non-intrusive inspection (NII) or physical examinations to 

examine high-risk shipments. Because of these permanent improvements in 

effectiveness for this measure, CBP expects to maintain this level of activity on an 

ongoing basis in the future. 

Data Source: CBP Automated Targeting System 

Performance Objective—Strengthen the CBP defense-in-depth approach through the use of state-of-theart detection and sensor technology, resources, and training. 

The goal of CBP is to screen 100 percent of all people, cargo, and conveyances entering the United 

States based on national security threshold targeting and to examine all identified people, cargo, and 

conveyances scoring above a mandatory threshold both abroad and at U.S. borders. Frontline officers 

and agents will use an array of radiation detection technology including personal radiation detectors. CBP 

will build on existing NII technology and expand the explosive and chemical detection canine program. 

36 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Goals and Results


Performance Measure—Percent of active commissioned canine teams with 100 percent detection rate results 

in testing of the Canine Enforcement Team. 

Description: The Canine Enforcement Program supports the protection of America and its citizens 

through twice yearly testing of the Canine Enforcement Teams and by maintaining a 

standard of full detection. To meet both new and existing threats, the CBP canine 

program has trained and deployed canine teams in a broad array of specialized 

detection capabilities. Any team exhibiting a weakness in detection capability for 

an area in which it has been trained must undergo additional training to bring it to 

a level of full detection. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 99% 100% 99.5% 99.9% 

Explanation of 

FY 2007 Results: 

Target Met—The CBP canine program has been successful at maintaining the 

highest detection rates of any canine program in the country, even though it is the 

largest and most diverse. This is due primarily to high training standards and regular 

testing to identify deficiencies early. CBP will continue to emphasize frequent testing 

and retraining in order to continue expanding detection capabilities while maintaining 

the highest detection rates possible. Well-trained canine units help stop explosives, 

illegal drugs, prohibited agriculture products, illegal immigrants, and undeclared currency from entering U.S. borders. 

Data Source: Canine Enforcement Program (CEP). 

Performance Objective—Push the nation’s zone of security outward beyond its physical borders through 

partnerships and extended border initiatives to deter and combat the threat of terrorism. 

Working with foreign Attaché officers, foreign governments and the trade community, CBP prescreens and 

targets shipments and containers that pose a potential risk for terrorism, before they arrive at U.S. POEs, 

using advance manifest information. The CBP CSI establishes a physical presence at foreign ports, 

shares intelligence and leverages technology to enhance the screening and examination of containers. 

CBP will continue to work with its foreign government counterparts to in-crease detection and interdiction 

capabilities of people, goods and materi-als from the points of origin through their transit areas to their 

final destination. 

Management’s Discussion and Analysis 37 
Performance Goals and Results


Performance Measure—Percent of worldwide U.S. destined containers processed through CSI ports. 

Description: The percentage of worldwide U.S.-destined containers (tracked via their respective 

bills of lading) processed through CSI ports as a deterrence action to detect and prevent terrorist weapons of mass destruction/effects (WMD/Es) and other potentially 

harmful materials from leaving foreign ports bound for U.S. ports. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 45% 73% 82% 86% 86% 

Explanation of 

FY 2007 Results: 

Target Met—The CSI Program added eight ports to the program during FY 2007, 

bringing the total number to 58 foreign ports. This resulted in increasing the total 

number of containers processed through CSI ports, which also increased the percentage of worldwide U.S. destined containers processed through CSI ports. Reviewing a 

higher percentage of U.S. destined cargo processed through CSI ports increases the 

likelihood of targeting, screening, and apprehending high-risk international cargo before 

embarkation to a U.S. POE to prevent terrorist attacks, while providing processes to 

facilitate the flow of safe and legitimate trade and travel from more foreign ports. 

Data Source: Shipping volume processed through the ports (bills of lading), Port Import Export Reporting Service (PIERS). 

Border Fencing along the U.S. and Mexico border is crucial 

to minimize illegal border crossings. 

Strategic Goal #2—Preventing Terrorism Between the Ports of Entry 

To achieve this strategic goal, CBP is implementing 

the National Border Patrol Strategy, with the goal 

of establishing and maintaining control of the 

borders. The CBP Border Patrol will employ a 

highly centralized and strengthened organizational 

model. Border security will be maximized with an 

appropriate balance of personnel, equipment, technology, communications capabilities, and tactical 

infrastructure. Further, CBP plans to expand the 

anti-terrorism mission of the Border Patrol through 

a national command structure, partnerships, 

intelligence sharing, training, technology, infrastructure support, and the use of specialized 

rapid-response teams. 

Performance Objective—Maximize border security along the northern, southern, and coastal borders 

through an appropriate balance of personnel, equipment, technology, communications capabilities, and 

tactical infrastructure. 

Differing threats result from the diversity of the borders and require CBP to maintain flexibility in its 

border security approach. To support border control efforts between the POEs, CBP will leverage technology, tactical infrastructure, and facilities to maximize the effectiveness of Border Patrol agents. CBP 

intends to add remote monitoring technology along the borders, which will improve our ability to assess 

threats and determine likely illegal border entry scenarios and locations. 

38 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Goals and Results


Performance Measure—Border miles under effective control (including certain coastal sectors). 

Description: The number of border miles under control where the appropriate mix of personnel, 

technology, and tactical infrastructure has been deployed to reasonably assure that 

when an attempted illegal alien is detected, identified, and classified, the Border 

Patrol has the ability to respond and the attempted illegal entry is brought to a 

satisfactory law enforcement resolution. As the Border Patrol continues to deploy 

additional resources based on risk, threat potential, and operational need, the 

number of miles under control will increase. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 288 Miles 449 Miles 524 Miles 599 Miles 

Explanation of 

FY 2007 Results: 

Target Met—Border Patrol exceeded its 524 mile target in FY 2007 through the 

continued application of the Border Patrol’s multi-year deployment strategy. Most 

of the gains were attributable to the 2,574 new Border Patrol agents hired during 

the year. The Border Patrol also received augmentation by National Guard troops 

participating in Operation Jump Start (OJS). Gains were made through the completion 

of additional primary fence, secondary fence, and vehicle barriers along the southwest border enhancing its enforcement capabilities. The Border Patrol added four 

ground surveillance radar systems that enhanced its ability to detect illegal entries in 

some of the vast, remote areas on the southwest border. 

Data Source: Operational Requirements Based Budget Program (ORBBP) database. 

Strategic Goal #3—Unifying as One Border Agency 

CBP continues to create a uniformed law enforcement workforce that works together in a professional manner with courtesy and respect toward 

the public, and that is recognized worldwide. 

Performance Objective—Establish a unified primary 

inspection process for passenger processing at 

all POEs into the United States and fully integrate 

analysis and targeting units. 

Electronic targeting systems allow CBP the ability 

to accurately and efficiently identify a potential risk 

to border security in any conveyance entering the 

United States. This effort is improved by linking 

data sources from CBP automated systems and other government agencies, through ACE, as a single 

source for border decision-makers. 

A CBP officer processes individuals as they enter the 

United States. 

Management’s Discussion and Analysis 39 
Performance Goals and Results


Performance Measure—Total number of linked electronic sources from CBP and other government agencies 

for targeting information. 

Description: The number of electronic sources to which CBP information technology systems are 

linked to share information for targeting purposes. The ability to accurately and 

efficiently identify a potential risk to border security in any conveyance entering the 

U.S. is improved by linking data sources from CBP automated systems and other 

government agencies, through ACE, as a single source for border decision makers. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A 9 16 16 

Explanation of 

FY 2007 Results: 

Target Met—CBP successfully met the FY 2007 target for this measure to increase 

the number of electronic sources to which CBP information technology systems 

are linked to share information for targeting purposes. These linkages are to databases both within and outside of DHS. In FY 2007, the addition of the Secure Freight 

Initiative’s (SFI) foreign port data sources have further enriched targeting information 

to DHS. 

Data Source: Targeting and Analysis Systems Program Office (TASPO). 

Biometric information such as inkless fingerprints and 

digital photographs is captured on foreign travelers seeking 

entry into the United States. 

Strategic Goal #4—Facilitating Legitimate Trade and Travel 

To improve risk assessment, CBP uses stateof-the-art modeling technologies that aid in identifying high risk for commercial enforcement. CBP 

continues to deploy NII technology, including 

radiation detection equipment such as personal 

radiation detectors, radiation isotope identification 

devices, and radiation portal monitors, as well as 

other screening technologies that support a layered inspection process. These and other initiatives help identify risks while preventing unnecessary delays in processing cargo and people. 

Performance Objective—Modernize automated 

import, export, and passenger processing systems 

to improve risk assessment and enforcement 

decision-making. 

CBP is developing and improving systems that can 

provide advance manifest information for prescreening cargo containers, agricultural products, and passengers. Trade and passenger related intelligence will be analyzed and distributed in a fast, meaningful way. Systems capable of linking law enforcement and other agency databases into one integrated database will be developed. 

40 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Goals and Results


Performance Measure—Advanced Passenger Information System (APIS) data sufficiency rate. 

Description: The accurate transmittal of advance passenger information data for law enforcement 

queries, decision making and targeting capabilities to identify high risk passengers 

prior to arrival. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 98.0% 98.6% 78.9% 90.0% 97.3% 

Explanation of 

FY 2007 Results: 

Target Met—Carrier compliance rates exceeded FY 2007 target. CBP National APIS 

Account Managers worked closely with carriers to identify and address technical and 

operational issues that improved carrier APIS transmissions. National APIS Account 

Managers also worked closely with carriers to implement changes necessary for 

WHTI requirements. Additionally, CBP released a new reporting capability allowing 

carriers to query individual flights to identify non-compliant records, allowing carriers 

to more readily review non-compliant records and make changes to further improve 

performance. 

Data Source: Airline passenger and crew manifest data. 

Performance Measure—Percent of CBP workforce using ACE functionality to manage trade information. 

Description: The number of Customs and Border Protection personnel using the Automated 

Commercial Environment (ACE), compared to the targeted adoption rate shows that 

internal personnel have easier and quicker access to more complete, accurate, and 

sophisticated information than in the past. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 8% 23% 30% 30% 

Explanation of 

FY 2007 Results: 

Target Met—Increasing the agency’s ACE user base means advanced cargo information will be more widely available thus increasing the use of targeting information to 

pre-screen, target and identify potential terrorist, terrorist shipments or contraband. 

The estimate of the expected population of CBP users will be reevaluated regularly. 

Data Source: Automated Commercial Environment system-use metrics. 

Management’s Discussion and Analysis 41 
Performance Goals and Results


Performance Measure—Number of trade accounts with access to ACE functionality to manage trade information. 

Description: The extent to which ACE is made available to and used by members of the trade 

community (importers, brokers, carriers, etc.) to process and manage trade-related 

information. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 1%* 3,737** 9,000 11,950 

Explanation of 

FY 2007 Results: 

Target Met—ACE and its secure data portal feature offers unprecedented information integration and communication between CBP, the trade community and other 

participating government agencies through a single, on-line access point. The growth 

in the number of ACE accounts is attributable to the successful deployment of ACE 

cargo processing capabilities at land border ports, as well as the introduction of Entry 

Summary Accounts and Revenue (ESAR) Release A1, which increases the range of 

trade entities using ACE. 

*Performance measure was previously reported as percent of trade accounts with access to 

ACE functionality to manage trade information. 

**FY2006 actual has been restated as a number. 

Data Source: Cargo Systems Program Office. 

Performance Objective—Promote industry and foreign government partnership programs. 

Through work with the WCO and the G-8, CBP continues to lead the international customs community 

in developing and ensuring rapid implementation of global supply chain security standards. To increase 

maritime port security, the agency will work to internationalize C-TPAT through coordination with the 

international community. Supply chain security specialists will continue to be hired and trained to visit 

participant facilities to review security practices. CBP intends to build on cooperative “Smart Border” 

agreements and pursue criminal enterprises involved in internal conspiracies at the POEs. 

42 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Goals and Results


Performance Measure—Compliance rate for C-TPAT members with established C-TPAT security guidelines. 

Description: A summary of the overall compliance rate achieved for all validations performed 

during the fiscal year. After acceptance into the C-TPAT program, all C-TPAT members 

must undergo a periodic validation to verify compliance with industry-specific CBP 

security standards and required security practices. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 97% 98% 95% 98% 

Explanation of 

FY 2007 Results: 

Target Met—In FY 2007, CBP has continued to increase the number of validations 

performed on C-TPAT members. A validation is a very thorough review by CBP that 

includes visits to all manufacturing and warehouse facilities by C-TPAT Specialists to 

verify that a C-TPAT member is in fact implementing the supply-chain security safeguards agreed to and required by C-TPAT. Over seventy percent of all C-TPAT members 

have been validated by CBP, with a total of 6,003 validations by the end of FY 2007. 

A high compliance rate indicates that a majority of C-TPAT members are committed to 

maintaining supply chain security standards. It indicates that they have the required 

level of supply chain security measures in place and are maintaining them on an ongoing basis. 

Data Source: C-TPAT Validation Reports. 

Strategic Goal #5—Protecting America and Its Citizens 

CBP protects the American people and the national 

economy by prohibiting the introduction of contraband such 

as illegal drugs, counterfeit goods, and other harmful materials and organisms into the United States. CBP continues 

to develop technology to enhance targeting of high-risk 

cargo and individuals attempting entry into the country. 

Performance Objective—Reduce the importation of all prohibited or illegal drugs and other materials that are harmful 

to the public or may damage the American economy. 

CBP monitors connections between illegal drug trafficking and terrorism, and coordinates efforts to sever such 

connections while interdicting illegal narcotics. Canine 

resources are used to detect illegal aliens, explosives, 

and chemicals, and to interdict drugs and agricultural commodities. CBP works closely with other Government agencies, industry, and stakeholders to measure agricultural risk and develop mitigation strategies 

to prevent harmful organisms from entering the United States intentionally or by accident. 

CBP agriculture officers inspect produce for 

dangerous exotic pests and diseases. 

Management’s Discussion and Analysis 43 
Performance Goals and Results


Performance Measure—International air passengers in compliance with agriculture quarantine regulations 

(percent compliant). 

Description: The degree of compliance with agriculture quarantine regulations and other mandatory 

agricultural product restrictions. CBP randomly samples international air passengers for 

compliance with all U.S. Department of Agriculture (USDA) laws, rules, and regulations 

using USDA guidance on sampling procedures. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 97.0% 95.8% 95.5% 97.0% 94.2% 

Explanation of 

FY 2007 Results: 

Target Not Met—The Air Compliance Rate with Agricultural Quarantine Regulations measures the rate of all violations of arriving travelers. The large majority of these violations are 

minor infractions. The increase in air travelers observed in FY 2007 may in part account for 

the slight increase in violations and resulting decrease in compliance, as more passengers 

unfamiliar with travel regulations and reporting requirements traveled in FY 2007. 

Recommended Action: CBP is continuing to take additional actions to further educate and inform the traveling 

public of all regulatory and procedural requirements. This includes expanded explanations of travel requirements on the CBP.gov website, such as “Know Before You Go” 

and the Western Hemisphere Travel Initiative (WHITI) Requirements page. CBP is 

working collaboratively with the carriers and airport authorities to improve instruction, 

signage, and on-board preprocessing. CBP is also working with industry to improve the 

traveler’s experience through the Rice-Chertoff Initiative, which will facilitate entry of air 

travelers into the U.S., and include new approaches for improving traveler processing 

and educating incoming travelers on U.S. laws, rules, and regulations. These efforts 

will improve passenger compliance in future years. 

Data Source: USDA Work Accomplishment Data System (WADS) Agricultural Quarantine Inspection monitoring activities. 

Performance Objective—Provide support to protect events and key assets of national interest and 

mitigate the risks of terrorism and other threats to critical government operations. 

CBP will continue to coordinate with other law enforcement partners to provide protection from airborne 

threats and to provide air and marine security for national efforts. 

44 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Goals and Results


Performance Measure—Percent of air support launches accomplished to support border ground agents to 

secure the border. 

Description: The percentage of all requests made for air support to which CBP A&M was able to 

respond. The capability to launch an aircraft when a request is made for aerial 

support is a primary and important measure for CBP A&M. IN FY 2006, all air assets 

of CBP were merged into CBP A&M creating the largest law enforcement air force in 

the world with enhanced mission support to CBP A&M’s primary customer, the Office 

of Border Patrol. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A N/A >95% 98% 

Explanation of 

FY 2007 Results: 

Target Met—Successes during FY 2007 for this measure can be attributed to CBP 

A&M’s efforts to standardize and thereby gain more efficiency in the area of aircraft 

maintenance. Also, several maintenance-intensive aircraft have been removed from 

the CBP fleet and additional aircraft have been added to inventory. Additional Air 

Interdiction Agents have been hired and trained to respond to requests for support. 

Data Source: Air and Marine Operations Reporting System (AMOR). 

Strategic Goal #6—Modernizing and Managing 

To achieve the other five strategic goals, CBP 

must put forth a continuous effort to enhance 

and modernize its business processes information 

technology systems and technical support services. CBP will assist its customers and stakeholders in obtaining and managing the financial 

resources and assets needed to accomplish the 

mission. To provide customers and stakeholders 

with accurate, timely, and integrated data, CBP 

intends to maintain and improve financial and 

administrative systems, along with increasing the 

use of e-commerce. 

Performance Objective—Maintain a reliable, stable, 

and secure IT infrastructure and an array of technical support services, including laboratory and scientific 

services, tactical radio communication, field equipment maintenance/support, and round-the-clock customer assistance. 

CBP continues to support its anti-terrorism mission and its widely dispersed field work-force by deploying 

a modern, robust, secure technology infrastructure that provides global systems integration and information warehousing for a completely automated trade, border security, and mission support environment. 

Information technology is crucial to CBP’s operations. 

Management’s Discussion and Analysis 45 
Performance Goals and Results


CBP intends to build and maintain a unified tactical communications capability that supports the needs 

of the agency and is coordinated within DHS. 

Performance Measure—Percent (%) of time the Homeland Enforcement Communication System (HECS) is 

available to end users. 

Description: A quantification, as a percentage, of the end-user experience in terms of HECS 

service availability. HECS is a CBP mission-critical law enforcement application 

system designed to identify individuals and businesses suspected of or involved in 

violation of federal law. HECS is also a communications system permitting message 

transmittal between DHS law enforcement offices and other national, state, and local 

law enforcement agencies. HECS provides access to the FBI’s National Crime Information Center (NCIC) and the National Law Enforcement Telecommunication Systems 

(NLETS) with the capability of communicating directly with state and local enforcement agencies. NLETS provides direct access to state motor vehicle departments. 

Key Highlight 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 96.2% 98% 97% 98.7% 

Explanation of 

FY 2007 Results: 

Target Met—CBP has put in place a robust set of procedures to ensure the end-user 

has access to the HECS when they need it. Having a high availability rate provides a 

better probability of apprehending those involved in illegal activities. 

Data Source: Topaz, a web-based application that enables users to track and analyze availability and system performance 

problems. 

46 U .S . Customs and Border Protection • Performance and Accountability Report 
Management Assurances


Overview 

To comply with the provisions of the Federal Managers’ Financial Integrity Act of 1982 (FMFIA); the 

DHS Financial Accountability Act of 2004; the Reports Consolidation Act of 2000; the Federal Financial 

Management Improvement Act of 1996 (FFMIA); the Federal Information Security Management Act of 

2002 (FISMA); and the Office of Management and Budget (OMB) Circular A-123, “Management’s 

Responsibility for Internal Control,” revised December 2004, the Commissioner of CBP must provide 

annual assurance statements to DHS regarding CBP’s management and financial system controls, 

internal controls over financial reporting, and performance data reliability. Any material weaknesses 

or deficiencies are reported in the statements. Information for these statements is derived from GAO 

and DHS OIG reviews, independent audits, and self-assessments provided by CBP management. 

Federal Managers’ Financial Integrity Act (FMFIA) 

In accordance with FMFIA and OMB Circular A-123, CBP has evaluated its management controls and 

financial management systems for the fiscal year ending September 30, 2007. Through our annual 

self-assessment process and GAO and OIG reviews for fiscal year 2007, we are reporting three open 

material weaknesses from prior years and three new material weaknesses. 

Custodial Revenue and Drawback Controls 

Drawback involves the reimbursement of duties paid by an importer on materials or merchandise 

imported into the United States and subsequently exported. In 1993, deficiencies were reported in 

the controls to prevent excessive drawback claims. The Automated Commercial System (ACS) has 

inherent limitations in detecting and preventing excessive drawback claims; therefore, CBP relies on a 

risk-based approach to review drawback claims. The implementation of the Automated Commercial 

Environment (ACE) Entry Summary Accounts and Revenue (ESAR) Drop 2.4 currently scheduled for 

September 2012 will resolve these issues. In addition, strengthening of drawback controls is dependent 

on legislation to simplify the drawback process and to revise document retention requirements for the 

trade. Finally, weaknesses have been noted and are being addressed in the monitoring of Foreign Trade 

Zones and Customs Bonded Warehouses, as well as the tracking of In-Bond cargo. 

Core Financial Systems 

This material weakness was first reported in 1993 when it was noted that agency core financial systems were not integrated and did not provide certain financial information for managing operations. 

The implementation of Systems, Applications, and Products (SAP) addressed a number of the issues 

under this weakness. The remaining open issue relates to the integration of the ACE and SAP systems. 

The ACE ESAR Drop 2, targeted for implementation by July 2008, provides the remaining necessary 

interfaces for Accounts Receivable. 

Management’s Discussion and Analysis 47 
Management Assurances


Financial Systems Security 

In the Fiscal Year 2005 DHS Financial Statements Audit Report, auditors expanded this DHS material 

weakness to include IT and financial system control weaknesses in addition to weaknesses in CBP 

security controls affecting headquarters and the National Data Center management and staff’s system 

access to CBP applications and data (formerly Financial Systems Functionality and Technology). To 

address the systems access component of this weakness for the Windows NT platform, the DHS Active 

Directory infrastructure is required. For the Novell network and Sun servers, Novell Netware 6.5 and Sun 

Solaris Version 10, respectively, will be required. The migration to these products is to be completed by 

March 2008. 

Information Technology General and Application Controls 

The DHS OIG notes that there continues to be information technology general and application control 

weaknesses at CBP. These weaknesses were identified in a set of 36 Notices of Finding and Recommendation (NFRs) in the information technology area resulting from the Fiscal Year 2007 Financial 

Statements Audit. Collectively, these weaknesses limit CBP’s ability to ensure that critical financial and 

operational data are maintained in such a manner to ensure confidentiality, integrity, and availability. 

CBP has completed corrective actions for 11 of the 36 NFRs. All corrective actions for the identified 

NFRs are expected to be completed by September 30, 2008. 

Laptop Computer Security 

During fiscal year 2006, the DHS OIG noted weaknesses related to CBP’s inventory control, inventory 

review, and training of local property officers regarding laptop computer security. In addition, a security 

issue related to controls ensuring that laptop computers are cleared and sanitized prior to reissue or 

disposal was identified. New controls and enhanced training were implemented in fiscal year 2007. 

Although significant progress has been made, CBP will continue to monitor control results during fiscal 

year 2008 to ensure that these weaknesses have been resolved. 

Secure Border Initiative Program Executive Office—Implementation of 

Management Controls 

The Secure Border Initiative Program Executive Office (SBI PEO) was established in fiscal year 2007. 


SBI PEO is currently implementing management controls and is not in a position to state with reasonable 


assurance that adequate controls are in place. CBP anticipates that controls will be in place to provide 


full assurances for fiscal year 2008.


DHS Financial Accountability Act 

The DHS Financial Accountability Act requires an assertion of internal controls over financial reporting. 

For fiscal year 2007, the scope of CBP’s assessment of internal controls over financial reporting included 

48 U .S . Customs and Border Protection • Performance and Accountability Report 
Management Assurances


performing tests of design and tests of operating effectiveness over the following financial management 

processes: 

• Fund Balance with Treasury, 

• Financial Reporting, 

• Entity-Level Controls, 

• National Response Plan Financial Management Annex, and 

• Information Systems Security. 

CBP’s assessment of internal control over financial reporting also included performing tests of design 

over the following financial management processes: 

• Payment Management and 

• Budgetary Resources. 

Based on the scope of this assessment, CBP’s Internal Control Assurance Statement provides reasonable assurance that internal controls over financial reporting were designed and operating effectively and 

no material weaknesses were found. 

Reports Consolidation Act 

The Reports Consolidation Act requires an assessment of the completeness and reliability of the performance data used in an agency’s annual PAR. Performance data used in this CBP Fiscal Year 2007 PAR 

are complete and reliable. 

Federal Financial Management Improvement Act (FFMIA) 

The Federal Financial Management Improvement Act (FFMIA) instructs agencies to maintain an integrated financial management system that complies with Federal system requirements, Federal Accounting Standards Advisory Board standards, and the U.S. Standard General Ledger at the transaction level. 

Although CBP has made significant improvements toward compliance through the implementation of SAP 

financial software, we cannot claim full compliance because of the deficiencies previously discussed. 

Federal Information Security Management Act (FISMA) 

The Federal Information Security Management Act (FISMA) requires agencies to conduct an annual 

self-assessment review of their IT security programs and to develop and implement corrective actions 

for identified security weaknesses and vulnerabilities. CBP has completed a comprehensive selfassessment for fiscal year 2007 and can state with reasonable assurance that the IT security controls 

are in compliance with FISMA, with the exception of the material weakness previously discussed. 

Management’s Discussion and Analysis 49 
Systems and Controls 


Overview 

Data Integrity: CBP is dedicated to providing clear, concise, relevant, and reliable data for managerial 

decision making and program management. We strive to ensure that the data are both quantifiable and 

verifiable and provided in a timely manner. In place are internal management controls, including ongoing 

data reviews, annual self-inspections, audit trails, restricted access to sensitive data, and separation of 

duties, designed to safeguard the integrity and quality of CBP’s data resources. 

Data Systems and Controls: Performance data for the planned performance measures are generated by 

automated management information and workload measurement systems and reports as a byproduct of 

day-to-day operations. All levels of management routinely monitor the data systems and controls. CBP 

management has reviewed the performance measurement data for fiscal year 2007 and has determined, 

with reasonable assurance, that the data are complete, accurate, and reliable. 

Audit of the Fiscal Year 2007 CBP Consolidated Financial Statements: As directed by DHS to assist the 

Department in complying with the Chief Financial Officer’s Act of 1990, DHS’s independent auditors, 

KPMG LLP, audited CBP’s consolidated financial statements (Consolidated Balance Sheet, Consolidated 

Statement of Net Cost, Consolidated Statement of Changes in Net Position, Combined Statement of 

Budgetary Resources, and Consolidated Statement of Custodial Activity), hereinafter referred to as the 

“financial statements.” The objective of the audit is to determine whether the financial statements fairly 

present the financial position of CBP. Audit reviews evaluate assets, liabilities, net position, net costs of 

major CBP programs, availability of budgetary resources, finance activity, budgetary spending, and revenue from collections and refunds. An audit consists of examining, through various sampling methods, 

evidence supporting the amounts and disclosures in the financial statements. The Independent Auditor’s 

Report can be found on page 137. 

Self-Inspection Program (SIP) 

SIP was developed to emphasize managerial accountability and provide a mechanism for management 

oversight of CBP programs and processes. SIP, along with other methodologies, helps CBP meet Federal 

management control requirements established by FMFIA and OMB Circular A-123, revised. SIP provides 

a method by which CBP headquarters and field managers conduct internal assessments of their operations and report on the results by completing self-inspection worksheets developed by national program 

managers. In completing and certifying the results of their self-inspections, managers assess whether 

their area of responsibility is: 

• Properly implementing established programs, policies, procedures, and strategies that support 

mission/program accomplishment; 

• Ensuring the security of funds, property, and other agency resources; and 

• Complying with Federal laws and regulations. 

For the current reporting cycle, the 19 offices of CBP completed more than 16,000 self-inspection worksheets. These worksheets require participants to answer questions resulting from testing about program 

administration and operation. 

50 U .S . Customs and Border Protection • Performance and Accountability Report 
Systems and Controls


Results of the assessments are entered into the Self-Inspection Reporting System (SIRS). In addition, 

SIRS requires the completion of an audit trail section that documents what information was reviewed 

prior to the worksheets being completed, as well as a separate addendum that gives a detailed description of the cause and corrective action for any deficiencies. Managers are responsible for implementing 

corrective action plans to resolve identified deficiencies. 

Every year, after the end of the SIP reporting cycle, the Management Inspection Division (MID) prepares 

a summary analysis report that identifies significant issues to help CBP management determine which 

administrative or operational areas require attention. Issues identified through this program may become 

the focus of MID internal inspection and review activities. 

Analysis of the self-inspection data allows executive managers and national program managers to gauge 

the level of compliance with critical program management controls, identify programmatic issues that 

require national attention, and address issues before they cause administrative burden or otherwise 

have a negative impact on the mission of CBP. 

Management’s Discussion and Analysis 51 
Financial Management 


Overview 

CBP strives to be a leader in financial management by providing high-quality, cost-efficient services 

through customer involvement and modern, integrated financial systems. Its goal is to continuously 

develop and implement more effective and efficient methods to obtain, manage, and deliver the financial 

resources, capital assets, and financial services to meet or exceed the needs of customers and stakeholders. Because CBP is also a revenue-collection agency, it is imperative that it accurately identify 

amounts owed to CBP and efficiently and effectively collect, report, and account for revenue. 

Providing top-quality financial management services includes translating workloads and requirements 

into budget requests for needed resources; allocating and distributing funds after resources are made 

available; acquiring and distributing goods and services that are used to accomplish the CBP mission; 

managing and paying for those goods and services; and reporting on the costs and use of personnel, 

goods, and services. 

For fiscal year 2007, SAP financial software continues to be used by CBP. SAP is a modular, PC-based, 

integrated financial management and reporting system that provides full materials management, budgeting, 

and general and subsidiary ledger capabilities. The impact of SAP is far-reaching, as it has put into place 

new automated, integrated processes for core finance and accounting, budget execution, and reporting. 

President’s Management Agenda (PMA) 

In 2001, the PMA was implemented as a management reform initiative established to identify deficiencies and improve performance within the Federal Government. For fiscal year 2007, the PMA focused 

on six key management initiatives across the Federal Government: (1) Strategic Management of Human 

Capital, (2) Competitive Sourcing, (3) Improved Financial Performance, (4) Expanded Electronic Government, (5) Budget and Performance Integration, and (6) Asset Management (Real Property). Federal 

Executive agencies are tracked, via a “scorecard,” on how well the departments and major agencies 

are executing the six government-wide management initiatives. 

In ongoing compliance and support of the PMA, CBP continues to efficiently and economically develop, 

implement, and track activities that improve its accomplishments and scorecards in the six areas of 

management weakness. 

The following highlights CBP’s accomplishments during fiscal year 2007 in the key areas. 

Human Capital 

Strategic human capital management refers to the methods an agency uses to employ, deploy, develop, 

and evaluate its workforce. These methods are measured against six standards of success that serve 

as a common language on which agencies can assess their progress on the strategic management of 

human capital. CBP continuously evaluates its human resources programs to ensure that the following 

standards are met: 

• Align human capital strategies with mission goals; 

• Plan and deploy the workforce to create a citizen-centered and mission-focused organization; 

52 U .S . Customs and Border Protection • Performance and Accountability Report 
Financial Management


• Ensure continuity of effective leadership; 

• Develop a results-oriented performance culture; 

• Close mission-critical competency gaps; and 

• Develop an accountability system to ensure that human capital management is merit-based, effective, 

efficient, and supports mission accomplishment. 

In fiscal year 2007, HRM partnered with CBP organizations to reinforce our Nation’s borders by recruiting 

and hiring an additional 2,500 Border Patrol agents, 446 Border Patrol operations staff, and 218 support staff. To accomplish this monumental task, many recruiting events were implemented. These 

included visits to military installations to take advantage of the experience of our Nation’s veterans, a 

sponsorship agreement with National Association for Stock Car Auto Racing—Busch Series Racing to 

promote public awareness of the agency’s mission, and the creation of 19 “one-stop” recruiting and hiring centers to screen, test, and provide tentative selection offers to qualified candidates. HRM was also 

tasked with recruiting and hiring an additional 646 CBP officers and 316 CBP agricultural specialists. 

In addition to supporting the mission to man our borders, HRM worked with other CBP program offices 

to modernize its law enforcement programs to meet the changing needs of the agency. Members of the 

staff collaborated with representatives of OBP to develop a career-path OBP position, thus making OBP 

more competitive with other Federal organizations in recruiting and retaining career law enforcement 

officers. In addition, a number of compensation options, including proposing a new retirement system 

that will provide full law enforcement officer coverage to CBP officers, are being developed. 

Competitive Sourcing 

The goal of competitive sourcing is to provide a more effective, efficient way to foster a more resultsoriented focus within Government organizations. Requirements for the Competitive Sourcing Initiative are 

outlined in and governed by statute and policy, including the Federal Activities Inventory Reform (FAIR) 

Act, OMB Circular A-76, OMB directives to the President’s Management Council, and DHS Management 

Directive 0476. 

During fiscal year 2007, CBP has done the following: 

• Initiated two Feasibility Review Studies, affecting approximately 317 full-time equivalent positions, to 

conduct an organizational assessment for business improvement opportunities. The scope of the 

reviews was tailored to best suit the business needs of the affected organization, namely OBP and 

OIT. The competitive sourcing staff structured the Feasibility Review Studies as a partnership with 

the organizations undergoing the review. Senior-level officials within the reviewed organizations helped 

define what business improvement issues they face and would like to include within the context of the 

study. The results of the Feasibility Review Study will be actionable recommendations for business 

improvement. The appropriateness of competitive sourcing will be among the questions answered by 

the team. Therefore, the Feasibility Review Studies will incorporate each of the steps of the 

competitive sourcing process. 

• Initiated preliminary planning for a streamlined competition affecting approximately 17 Full Time 

Equivalent (FTE). 

• Conducted post competition accountability efforts, as required by OMB Circular A-76. 

Management’s Discussion and Analysis 53 
Financial Management


• Reviewed all positions and categorized the functions of the positions as commercial or inherently 

governmental, as required annually by the FAIR Act. This inventory process further requires agencies 

to assign a function code to the position and identify whether the function performed is suitable for 

competition with the private sector. 

• Initiated the update of long-range plans directed at achieving “green” status on the PMA scorecard, 

specifically for the Competitive Sourcing Initiative, as required by OMB. 

Financial Performance 

The PMA initiative for Improved Financial Performance directs agencies to possess more timely and 

reliable financial information, improve the integrity of their financial activities, and have sound and 

dependable financial systems. CBP has fully supported this PMA initiative with its implementation of the 

DHS Financial Accountability Act. The Act requires DHS and its components to meet internal control 

requirements in advance of all other Federal agencies. In implementing the DHS Financial Accountability 

Act, the DHS Chief Financial Officer has established a strategy of eliminating material weaknesses in 

internal controls over financial reporting and obtaining an unqualified audit opinion on the DHS consolidated financial statements. In support of this strategy, CBP has done the following: 

• Received an unqualified audit opinion in Fiscal Year 2006 and 2007 on its full set of Financial 

Statements. 

• Prepared and initiated corrective action plans to resolve auditor-identified and Integrity Act material 

weaknesses in internal controls. This includes developing annual risk management plans and risk 

mitigation plans that include milestones to proactively monitor and resolve identified issues of 

weakness in internal controls and processes that may affect resources. 

• Maintained accountability for financial and performance information during operational evaluation and 

decision making through quarterly reviews. Management of financial and performance data in FYHSP 

allows senior management to complete program evaluations and make funding decisions. 

E-Gov 

CBP continues to focus IT spending on modernization initiatives in many areas, such as expanded cargo 

processing for the ACE program, expanded electronic manifest certification, and implementation of Foreign 

Trade Zone automated admission and cargo control capabilities. CBP is promoting the use of Earned Value 

Management by incorporating its use and capabilities into the OIT Project Management Education and 

Certification Program for all project managers for mandatory use in project planning and management. 

In 2007, CBP successfully certified and accredited major IT systems and projects and met its goal of full 

compliance for the fiscal year. CBP aligned major IT systems with the Federal Enterprise Architecture’s 

Lines of Business to eliminate duplicate processes and improve system efficiency and effectiveness. 

Budget and Performance Integration 

The Budget and Performance Integration Initiative builds on the GPRA and the Homeland Security Act 

of 2002, which directs DHS to identify program goals and performance measures and link them to the 

budget process. DHS created FYHSP to communicate to Congress its resource plans, performance, and 

milestones for 5 years for programs that support DHS strategic goals and objectives. 

54 U .S . Customs and Border Protection • Performance and Accountability Report 
Financial Management


In support of FYHSP, CBP regularly monitors external program evaluations, develops and tracks 

meaningful performance measures, improves out-year planning with program milestones, leads in the 

development of the CBP strategic plan, coordinates risk assessment information for program resource 

requests, coordinates program implementation and resource plans, and assists projects with developing 

project schedules and reporting on project status. Information on these activities is shared with senior 

management to ensure that they make informed resource allocation decisions. 

Asset Management (Real Property) 

The goal of the Real Property initiative under the PMA is to promote the efficient and economical use 

of Federal real property resources in accordance with their value as national assets and in the best 

interests of the Nation. 

The Office of Finance, Office of Asset Management of CBP provides real property assets in support of 

the agency’s overall mission with a range of facilities services, including new construction, leasing, 

repairs and alterations, operations and maintenance, and technology insertion to meet requirements 

for the following types of assets: 

• Land, air, and sea POEs; 

• Border Patrol sector headquarters, stations, checkpoints, and remote operating bases; 

• Tactical infrastructure on the border, including barriers, fencing, lighting, patrol roads, bridges, 

drainage structures, and control of brush and other obstructions; 

• Air and Marine operations facilities; 

• Detention and removal facilities; 

• Laboratories and other special use space; and 

• Administrative space. 

In support of the PMA during fiscal year 2007, CBP has done the following: 

1. Implemented the CBP and DHS Asset Management Plan (AMP) 3-year Timeline Initiatives. 

CBP significantly contributes to the DHS AMP 3-year timeline initiatives to demonstrate measurable 

progress toward the Component and DHS Headquarters milestone completions. CBP is an active 

participant and contributor on four Task Force initiatives: Utilization, Mission Dependency, DecisionMaking Process, and Operations Expense. CBP is also a member of the Facilities Condition Index 

Integrated Product Team (IPT), led by the USCG. 

CBP remains active with the DHS Real Property Management Council (RPMC), having hosted the 

DHS–PMA/Federal Real Property Program (FRPP) Training for several DHS components at its 


Indianapolis facility. 


2. Demonstrated Asset Management Plan Implementation. 

CBP has demonstrated measurable results toward milestone completion by submitting a CBP real 

property asset management plan, conducting a comprehensive real property inventory of owned property, and leading the reconfiguration of CBP’s enterprise system to accommodate FRPP data element 

management. 

Management’s Discussion and Analysis 55 
Financial Management


CBP’s Energy Management group has established a strategic plan and approach to identify and review 


energy rates, and to define opportunities to achieve cost savings and better rates. 


CBP is also collecting and documenting lease expirations to forecast rent projections for more accu­


rate funding appropriations. 


CBP has improved its new construction program to address program requirements that serve a Fed­


eral need that cannot be readily met with existing Federal assets or assets available in the private 


sector. The prioritization of these projects is done in coordination with the customer in the program 


area with the requirement. The process includes detailed methodology for identification of project 


need using a long-range strategic resource assessment. Projects are prioritized using strategic mis­


sion objectives, facilitated by the use of forecasting models, automated design standards, project 


cost estimation, project scoring, and project budgeting modules in an electronic database format. 


CBP also uses Mission Dependency, Operating Expense, Utilization, and Condition Index Data.


3. Demonstrated that CBP real property management is consistent with the AMP and DHS performance 

measures.


CBP conducted a comprehensive land and POE facilities inventory in fiscal year 2006 and has com­


menced comprehensive facilities conditions assessments beginning in July 2007. CBP provided esti­


mated replacement costs based on acquisition costs and factors.


CBP is using the four performance metrics (Operating Expense, Utilization, Mission Dependency, and 

Condition Index) to make sound Capitol Investment Planning decisions, including land and POEs and 

OBP facilities. When funding is appropriated, the Facility Divisions prepare specific project requirements, and feasibility and environmental plans, for the project execution procurement strategy for 

design and construction. 

Improper Payments Information Act of 2002 (IPIA) 

CBP Improper Payment Information Act (IPIA) efforts included the completion of a risk assessment of all 

CBP programs and the identification of two custodial programs that were determined to be susceptible 

to significant erroneous payments. The two programs, Custodial Refund and Drawback, and Custodial 

Continued Dumping and Subsidy Offset Act and Payments to Wool Manufacturers, both relate to duty, 

tax and fee trade-related activity. 

CBP performed sample payment testing on these programs which supported the conclusion that the 

programs were susceptible to erroneous payments. Testing yielded an estimated improper payment 

amount of $18.4 million of $1.6 billion, or 1.150 percent, disbursed during fiscal year 2006. 

Additionally, CBP performed sample payment testing on disbursements related to the Secure Border 

Initiative (SBI). SBI is a new activity receiving significant appropriated funding, and public and congressional interest. The testing was performed on a sample of payments made during October 2006 through 

March 2007 and yielded positive results. An estimated improper payment amount was identified of 

$2,000 of $155 million disbursed, or 0.001 percent. 

56 U .S . Customs and Border Protection • Performance and Accountability Report 
Financial Management


Recovery Auditing 

CBP was granted relief from the Department of Homeland Security (DHS) Office of Chief Financial Officer 

from performing recovery audit work in accordance with Office of Management and Budget (OMB) Memorandum M-03-07. DHS is coordinating the relief request with OMB. CBP made the request after recovery 

audit work conducted for fiscal years 2003 through 2005 produced negligible recovery amounts. The 

amount of effort expended by CBP and contractor personnel as compared to recoveries identified and 

subsequently collected clearly demonstrated that recovery auditing for CBP and contractor personnel is 

not cost effective. 

CBP did continue efforts to validate and collect amounts identified by the contractor from prior year 

efforts. The prior year efforts included both a review of actual disbursements made during fiscal years 

2003 and 2004, and a survey of all vendors to identify any amounts owed to CBP. CBP continues to work 

with the vendors to recover the outstanding amounts. The recovery audit results are reported below: 

Actual Cumulative 

Amount Amount Amounts Amounts Amounts 

Subject to Reviewed Identified Identified Identified Cumulative 

Review and for Amounts for Amounts for Amounts 

for CY Reported Recovery Recovered Recovery Recovered Recovery Recovered 

Reporting CY CY CY PYs PY (CY + PYs) (CY + PYs) 

N/A – N/A – N/A – $97,294 $179,476 $26,830 $179,476 $124,124 

Relief Relief Relief 

Granted Granted Granted 

In addition, CBP identified amounts for recovery during the Improper Payment Information Act (IPIA) 

review of FY 2006 Custodial Program disbursements and Secure Border Initiative (SBI) Program disbursements. The IPIA results are as follows: 

Amounts Identified as 

Improper Payments 

Amounts Identified 

for Recovery Amounts Recovered 

Custodial Program $107,427 $34,466 $2,458 

SBI Program $ 513 $ 0 $ 0 

Totals $107,940 $34,466 $2,458 

Recoveries for Custodial Program payments are restricted by regulations governing collections of duty, taxes 

and fees associated with trade-related activity. CBP will be able to recover $34,466 of the total IPIA Custodial Program improper payment amount of $107,427. The SBI Program improper payment amount of $513 

will not be recovered as CBP does not consider it to be cost-effective to collect the individual amounts. 

Overview of the Financial Statements 

The financial statements and footnotes appear in the “Financial Section” of this report on pages 77 

through 136. The financial statements have been audited by our independent auditor, KPMG LLP, and 

have been found to have no material misstatements as evidenced by the audit report. 

Management’s Discussion and Analysis 57 
Financial Management


Consolidated Balance Sheet 

The Consolidated Balance Sheet presents the property owned by CBP (assets), amounts owed by CBP 

(liabilities), and the amounts of the difference (net position). As of September 30, 2007, total assets 

were $12.3 billion, an 18 percent decrease from fiscal year 2006, which was primarily due to a decrease 

in the Fund Balance with Treasury resulting from disbursements of Canadian softwood lumber refunds. 

Although Property, Plant and Equipment increased 31 percent compared to September 30, 2006, this 

was offset by the larger decrease in Fund Balance with Treasury. Construction of tactical infrastructure 

projects was the primary reason for the increase in Property, Plant and Equipment. 

58 U .S . Customs and Border Protection • Performance and Accountability Report 

2007 Assets

Duties & Trade

Receivables

16% Property Plant

& Equipment

20%

Other

5%

Fund Balance

with Treasury

59%

2006 Assets

Duties & Trade

Receivables

12%

Property Plant

& Equipment

13%

Other

6%

Fund Balance

with Treasury

69%
Financial Management


As of September 30, 2007, total liabilities were $5.5 billion, a decrease of 44 percent over fiscal year 

2006, which was primarily due to a decrease in Refunds Payable resulting from disbursements of Canadian softwood lumber refunds. Although Due to the General Fund increased 15 percent compared to 

September 30, 2006, this was offset by the decrease in Refunds Payable. The increase in Due to the 

General Fund was a result of increased non-entity collections and accrued receivables. 

The charts on these two pages present a comparison of the major categories of assets and liabilities as 

a percentage of the totals for fiscal year 2007 and fiscal year 2006. 

Management’s Discussion and Analysis 59 

Other

17%

2007 Liabilities

Due the General Fund

37%

Refunds Payable

2%

Injured

Domestic

Industries

7%

Payroll &

Benefits

19%

Accounts

Payable

18%

2006 Liabilities

Other

5%

Due the

General Fund

18%

Refunds Payable

57%

Injured

Domestic

Industries

5%

Payroll &

Benefits

10%

Accounts

Payable

5%
Financial Management


Consolidated Statement of Net Cost 

The Consolidated Statement of Net Cost presents the net cost of the major CBP programs as they relate 

to the goals of the 2005–2010 Strategic Plan. For the year ended September 30, 2007, the gross cost 

less offsetting revenue for each program equals the net cost of operations of $8 billion, which represents a 15 percent increase compared to the year ended September 30, 2006. This increase was 

primarily due to spending for border security and information technology. 

60 U .S . Customs and Border Protection • Performance and Accountability Report 

Border Security

& Control

34%

Air & Marine

Operations

4%

Facilitation at the

Ports of Entry

62%

2007 Net Program Costs

Border Security

& Control

31%

Air & Marine

Operations

5%

Facilitation at the

Ports of Entry

64%

2006 Net Program Costs
Financial Management


Consolidated Statement of Changes in Net Position 

The Consolidated Statement of Changes in Net Position represents those accounting transactions that 

caused the net position of the balance sheet to change from the beginning to the end of the reporting 

period. CBP’s net cost of operations serves to reduce net position. Appropriations used totaled $5.6 

billion, representing 66 percent of CBP’s total financing sources. CBP collected and retained $2.4 billion 

of non-exchange revenue, which comprised 28 percent of total financing sources. 

For the year ended September 30, 2007 total cumulative result of operations and unexpended appropriations were $2.6 billion and $4.1 billion, an increase of 23 and 39 percent respectively over the 

September 30, 2006 cumulative results of operations and unexpended appropriations. These increases 

were primarily due to appropriations received and other financing sources during fiscal year 2007. 

Combined Statement of Budgetary Resources 

The Combined Statement of Budgetary Resources illustrates how budgetary resources were made available, as well as their status at the end of fiscal year 2007. CBP had $15.4 billion in budgetary resources, 

which represents an increase of 22 percent compared to the year ended September 30, 2006. The 

increase was primarily due to appropriations received for information technology and construction of 

tactical infrastructure projects. Also, for the year ended September 30, 2007, CBP incurred obligations 

of $12.5 billion and recorded $11.4 billion in gross outlays, an increase of 21 and 20 percent respectively over the September 30, 2006 incurred obligations and gross outlays. 

Management’s Discussion and Analysis 61 
Financial Management


Consolidated Statement of Custodial Activity 

The Consolidated Statement of Custodial Activity presents non-entity (financial activity conducted by CBP 

on behalf of others) revenue and refunds using a modified cash basis. This method reports revenue from 

cash collections separately from receivable accruals, and cash disbursements are reported separately 

from payable accruals. The custodial revenue, using the modified cash basis, for fiscal year 2007 was 

$36.4 billion, a 58 percent increase compared to fiscal year 2006. This increase was primarily due to 

the recognition of collections in fiscal year 2007 for Canadian softwood lumber imports. 

62 U.S. Customs and Border Protection • Performance and Accountability Report 

User Fees

Excise Taxes 4%

9%

Duties

87%

2007 Custodial Cash Collections

Other

< 1 %

User Fees

Excise Taxes 4%

9%

Duties

87%

2006 Custodial Cash Collections

Other

< 1 %
Financial Management


Limitations of the Financial Statements 

The principal financial statements have been prepared to report the financial position and results of the 

operations of CBP, pursuant to the requirements of 31 U.S.C. 3515(b). While the financial statements 

have been prepared from the books and records of CBP in accordance with Generally Accepted Accounting Principles for Federal entities and the formats prescribed by OMB, the statements are in addition to 

the financial reports used to monitor and control budgetary resources, which are prepared from the 

same books and records. 

The financial statements should be read with the realization that they are a component of the U.S. Government, a sovereign entity. Liabilities not covered by budgetary resources cannot be liquidated without 

the enactment of an appropriation by Congress, and payment of liabilities, other than for contracts, can 

be abrogated by the sovereign entity. 

Management’s Discussion and Analysis 63 
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Performance Section 
Performance Summary


The chart below highlights CBP’s success in achieving fiscal year 2007 performance goals. The performance measures are established as an integral part of the CBP Strategic Plan and the DHS FYHSP. 

The measurement data are collected through various systems and methods and then entered into the 

FYHSP system for tracking and compiling for management decision-making and year-end reporting. 

Security, threat, and risk analyses often necessitate changes in the agency’s focus. CBP performance 

measures continue to evolve to better reflect operational functions and alignment with critical missions. 

For fiscal year 2007, CBP has 26 reportable performance measures that support the Strategic Plan. 

Of the 26 performance measures, 20 were met and 6 were not met. The performance data presented 

in this report are in accordance with the guidance provided by OMB. The data integrity discussion in the 

“Systems and Controls” section of the “Management’s Discussion and Analysis” (page 50) describes 

CBP’s commitment to providing quality and timely performance information to increase its value to CBP 

management and interested parties. CBP managers routinely use these data to improve the quality of 

program management and demonstrate accountability of program results. 

Individual Performance Measure Results 

This section describes CBP’s fiscal year 2007 results for each FYHSP performance measure by the 

strategic goal and performance objective they support. Although some of the performance measures 

may relate to more than one performance objective, each performance measure was aligned under the 

single objective considered most relevant or meaningful. Discussions of the key performance measures 

can be found in the “Management’s Discussion and Analysis” section under “Performance Goals and 

Results,” beginning on page 34. 

66 U .S . Customs and Border Protection • Performance and Accountability Report 

FY 2007 Performance

Not Met

23%

Met

77%
Performance Summary


Strategic Goal #1—Preventing Terrorism at the Ports of Entry 

Performance Objective—Improve identification and targeting of potential terrorists and terrorist weapons, 

through risk management and automated advances and enhanced information. 

Performance Measure—Number of foreign cargo examinations resolved in cooperation with the Container 

Security Initiative (CSI). 

Key Highlight Target Not Met—See page 36 for results and detailed discussion. 

Performance Objective—Strengthen the CBP defense-in-depth approach through the use of state-ofthe-art detection and sensor technology, resources, and training. 

Performance Measure—Percent of active commissioned canine teams with 100 percent detection rate results 

in testing of the Canine Enforcement Team. 

Key Highlight Target Met—See page 37 for results and detailed discussion. 

Performance Objective—Push the nation’s zone of security outward beyond its physical borders through 

partnerships and extended border initiatives to deter and combat the threat of terrorism. 

Performance Measure—Percent of worldwide U.S. destined containers processed through Container Security 

Initiative (CSI) ports. 

Key Highlight Target Met—See page 38 for results and detailed discussion. 

Strategic Goal #2—Preventing Terrorism Between Ports of Entry 

Performance Objective—Maximize border security along the northern, southern, and coastal borders 

through an appropriate balance of personnel, equipment, technology, communications capabilities, and 

infrastructure. 

Performance Measure—Border miles under effective control (including certain coastal sectors). 

Key Highlight Target Met—See page 39 for results and detailed discussion. 

Performance Section 67 
Performance Summary


Performance Measure—Percent of apprehensions at Border Patrol checkpoints. 

Description: An examination of one checkpoint activity, apprehensions, compared to the number 

of Border Patrol apprehensions nationwide. Checkpoints are temporary and permanent facilities used by the Border Patrol to monitor traffic on routes of egress from 

border areas and are an integral part of the Border Patrol’s defense-in-depth strategy. 

Activities that occur at checkpoints serve as a measure not only of checkpoint 

operational effectiveness, but as a barometer of the effectiveness of Border Patrol’s 

overall national border enforcement strategy to deny successful illegal entries into 

the U.S. This comparison measures checkpoint effectiveness in terms of apprehensions and provides insights into the overall effectiveness of the Border Patrol’s 

national strategy. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A 5.9% 5%–10% 5% 

Explanation of 

FY 2007 Results: 

Target Met—The checkpoints are a component of the successful defense-in-depth 

strategy which deny major routes of egress to smugglers intent on delivering people 

and illegal contraband into the U.S. While nationwide checkpoint apprehensions 

remained consistent overall, apprehensions in Tucson decreased due to the 

continued enhanced level of operations in Arizona with Operation Jump Start and the 

Arizona Border Control Initiative. 

Data Source: Summary records from Border Patrol’s Checkpoint Activity Report (CAR) and data maintained in two databases: ENFORCE and BPETS. 

Performance Measure—Total number of cumulative miles of permanent tactical infrastructure constructed. 

Description: The total number of permanent cumulative miles of tactical infrastructure constructed. Tactical infrastructure consists of barriers built to deter or delay illegal 

entries into the U.S. Tactical infrastructure includes pedestrian fencing, all-weather 

roads, vehicle fence and permanent lighting installed in the border areas to support 

border enforcement activities. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A N/A 310 400.2 miles 

Explanation of 

FY 2007 Results: 

Target Met—In FY 2007, SBI programs completed construction of nearly 155 miles 

of additional permanent tactical infrastructure. This includes an additional 72.3 miles 

of primary fence (for a total of 154.67), another 20 miles of all-weather roads (for a 

total of 74.3) were constructed, an additional 52.5 miles of vehicle fence were added 

(for a total of 109.5), and 10.1 miles of lighting (for a total of 61.7) were installed on 

the border to support border enforcement activities. Providing for over 400 miles of 

tactical infrastructure. 

Data Source: Permanent tactical infrastructure implementation plans and installation progress data in ORBBP, SAP, 

ENFORCE, and BPETS. 

68 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Summary


Performance Measure—Percent of narcotic seizures at Border Patrol checkpoints compared to Border Patrol 

seizures nationwide. 

Description: The percentage of narcotic seizures at Border Patrol checkpoints compared to the 

percentage of narcotic seizures nationwide. The Border Patrol checkpoint operations 

are an integral part of the Border Patrol’s defense-in-depth strategy. As such, these 

activities serve as measures for both the checkpoint operational effectiveness and 

the value of the Border Patrol’s overall national border enforcement strategy to deny 

successful illegal entries into the U.S. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A N/A 35%–50% 34% 

Explanation of 

FY 2007 Results: 

Target Not Met—The number of narcotic seizure events at Border Patrol checkpoints 

was compared to the number of narcotic seizure events by Border Patrol nationwide 

to determine what percentage of events take place at Border Patrol checkpoints. This 

measure continues to show the effectiveness of Border Patrol checkpoint operations 

in detecting narcotic and illegal contraband as part of the defense-in-depth strategy 

and support the Border Patrol National Strategy to protect America and its citizens. 

Recommended Action: The Border Patrol has lowered the target range for the percentage of narcotic seizure 

events at the Border Patrol checkpoints to more closely reflect an ambitious but 

realistic target for this measure. 

Data Source: The number of narcotic seizure events are obtained through the Checkpoint Activity Report. The number of 

nationwide narcotic seizure events are obtained through ENFORCE and BPETS. 

Performance Measure—Percent of traffic checkpoint cases referred for prosecution to the U.S. Attorney’s 

Office. 

Description: The percentage of border related cases brought by the Border Patrol and originating 

from traffic checkpoint operations that are referred to one of the 92 U.S. Attorneys 

located throughout the U.S., Puerto Rico, and the Virgin Islands for prosecution 

compared to the total number of apprehensions at traffic checkpoints. This measure 

will depict the effectiveness of Border Patrol checkpoint operations in identifying 

and prosecuting dangerous criminals thus enhancing overall public safety. All 

apprehensions by OBP are considered arrests (administrative or criminal). The 

number of cases tracked in this measure represents criminal arrests only. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A N/A 3%–13% 13% 

Explanation of 

FY 2007 Results: 

Target Met—The criminal cases referred for prosecution support the strategic goals 

of preventing terrorism, achieving effective control of the border and reducing crime in 

border communities. The cases referred are broken down into four categories: alien 

smuggling, drugs/narcotics, fraudulent documents and other. Data are analyzed for 

compliance with established data protocols and accuracy and continue to show the 

effectiveness of the Border Patrol’s layered enforcement strategy. 

Data Source: Border Patrol’s Checkpoint Activity Report (CAR). 

Performance Section 69 
Performance Summary


Performance Measure—Percent of network availability 

Description: The percentage of network availability to users. The CBP network provides the basis 

for linking all IT systems for communications and access to mission critical systems. 

High levels of system availability are needed to accomplish CBP’s mission. 

Fiscal Year: FY 2004 FY 2005 FY 2006 FY 2007 FY 2007 

Actual Actual Actual Target Results 

Target/Actual Indicator: N/A N/A 99.9% 98% 99.4% 

Explanation of Target Met—CBP’s FY 2007 network availability exceeded posted targets due to an 

FY 2007 Results: organizational effort to minimize unscheduled outages and reduce unscheduled 

downtime for our critical National Security mission. 

Data Source: Simple Network Management Protocol (SNMP) data source is directly retrieved from managed device every 

five minutes. 

Performance Objective—Expand specialized teams and rapid-response capabilities to enhance control of 

the borders, with expansion to problematic areas as identified through continuing threat assessments. 

Performance Measure—Number of Border Patrol Agents trained in rescue and emergency medical procedures. 

Description: The number of agents trained and certified in rescue and emergency medical 

procedures. One of the Border Patrol’s Border Safety Initiative (BSI) objectives is to 

increase the number of agents trained and certified in rescue and emergency medical 

procedures at the field agent level to improve the Border Patrol’s capabilities to 

prevent and respond to humanitarian emergencies to create a safer and more secure 

border region. 

Fiscal Year: FY 2004 FY 2005 FY 2006 FY 2007 FY 2007 

Actual Actual Actual Target Results 

Target/Actual Indicator: N/A N/A N/A 510 796 

Explanation of Target Met—OBP exceeded the FY 2007 target. This training for agents enhances 

FY 2007 Results: the safety of our Nation’s borders by providing life saving interventions in remote 

areas where response times are much longer. This training also certifies agents to 

provide standardized medical care in emergencies when they are the first to arrive on 

the scene. Exceeding the targets shows OBP’s commitment to enhancing safety while 

performing their essential missions along the Nation’s border. 

Data Source: Border Patrol Enforcement Tracking System (BPETS). 

Strategic Goal #3—Unifying as One Border Agency 

Performance Objective—Establish a unifed primary inspection process for passenger processing at all 

ports of entry into the United States and fully integrate analysis and targeting units. 

Performance Measure—Total number of linked electronic sources from CBP and other government agencies 

for targeting information. 

Key Highlight Target Met—See page 40 for results and detailed discussion. 

70 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Summary


Strategic Goal #4—Facilitating Legitimate Trade and Travel 

Performance Objective—Modernize automated import, export, and passenger processing systems to 

improve risk assessment and enforcement decision-making. 

Performance Measure—Advanced passenger information (APIS) data sufficiency rate. 

Key Highlight Target Met—See page 41 for results and detailed discussion. 

Performance Measure—Percent of CBP workforce using ACE functionality to manage trade information. 

Key Highlight Target Met—See page 41 for results and detailed discussion. 

Performance Measure—Number of trade accounts with access to ACE functionality to manage trade 

information. 

Key Highlight Target Met—See page 42 for results and detailed discussion. 

Performance Objective—Utilize state-of-the-art technologies and processes to leverage resources and to 

conduct examinations of all potential high-risk cargo, conveyances and passengers. 

Performance Measure—Percent of truck and rail containers screened for contraband and concealed people. 

Description: The percentage of truck and rail containers that were screened for contraband and 

concealed people using Non-Intrusive Inspection (NII) technology. This measure 

shows progress towards increasing security by measuring the percent of truck and 

rail containers that were screened for contraband and concealed people using NII 

technology. NII technology consists of X-ray imaging and electromagnetic imaging 

equipment that is very effective at inspecting trucks, containers, and packages for 

shapes, density, and hidden cargo. It is very effective at identifying weapons, 

narcotics, smuggled humans, and concealed cargo. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 26.6% 28.9% 32.8% 33% 40% 

Explanation of 

FY 2007 Results: 

Target Met—NII examinations are conducted to perform 100% examination of all 

targeted high-risk containers identified through Automated Targeting System (ATS) 

manifest reviews. The higher the % of cargo screened using NII, the greater the 

likelihood of detecting potentially hazardous materials and preventing them from 

entering the U.S. This technology is a very effective and more efficient alternative to 

100 percent physical inspection of all targeted high-risk containers All major rail 

crossings now perform nearly 100% examinations of rail containers. 

Data Source: Operations Management Reports (OMR) Data Warehouse. 

Performance Section 71 
Performance Summary


Performance Measure—Percent of sea containers screened for contraband and concealed people. 

Description: The percentage of sea containers that were screened for contraband and concealed 

people using Non-Intrusive Inspection (NII) technology. The measure shows progress 

towards increasing security by measuring the percent of sea containers arriving at 

seaports that were screened for contraband and concealed people using NII 

technology. NII technology consists of X-ray imaging and electromagnetic imaging 

equipment that is very effective at inspecting trucks, containers, and packages for 

shapes, density, and hidden cargo. It is very effective at identifying weapons, 

narcotics, smuggled humans, and concealed cargo. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 5.2% 5.6% 5.25% 5.5% 4.0% 

Explanation of 

FY 2007 Results: 

Target Not Met—NII examinations are conducted to perform 100% examination of all 

targeted high-risk containers identified through Automated Targeting System (ATS) 

manifest reviews. These are containers that are identified to have a higher risk profile 

and which may pose a threat to our security. The higher the % of cargo screened 

using NII, particularly high-risk cargo, the greater the likelihood of detecting potentially 

hazardous materials and preventing them from entering the U.S. ATS is a very 

effective and more efficient alternative to 100 percent physical inspection of all 

targeted high-risk containers. In April 2007, ATS targeting rules were refined, resulting 

in an overall reduction in the number of mandatory examinations required. This 

“mandatory” decrease was not compensated for by a corresponding increase in 

discretionary (CBP Officer selected exams, resulting in an overall decrease in the 

total number of NII exams completed. 

Recommended Action: CBP will work to increase the number of discretionary examinations to more than 

offset the decrease in mandatory exams that resulted from the improvements in the 

ATS targeting rules. Discretionary exams are conducted based on CBP officer 

assessment and targeting. 

Data Source: Operations Management Reports (OMR) Data Warehouse. 

Performance Objective—Promote industry and foreign government partnership programs. 

Performance Measure—Compliance rate for C-TPAT members with established C-TPAT security guidelines. 

Key Highlight Target Met—See page 43 for results and detailed discussion. 

72 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Summary


Performance Objective—Enforce all U.S. trade, immigration, drug, consumer protection, intellectual 

property, and agricultural laws and regulations at the borders. 

Performance Measure—Air passengers compliant with laws, rules, and regulations (%). 

Description: The compliance rate of international air passengers with all of the laws, rules, and 

regulations that CBP enforces at the Ports of Entry, with the exception of agriculture 

laws and regulations. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 99.2% 99.0% 98.7% 99.2% 98.7% 

Explanation of 

FY 2007 Results: 

Target Not Met—The Air Compliance Rate measures the rate of all violations of 

arriving travelers. The large majority of these violations are minor infractions. The 

increase in air travelers observed in FY 2007 may in part account for the slight 

increase in violations and resulting decrease in compliance, as more passengers 

unfamiliar with travel regulations and reporting requirements traveled in FY 2007. 

Recommended Action: The air compliance rate primarily measures the rate of minor violations of arriving 

travelers. CBP is continuing to take additional actions to further educate and inform 

the traveling public of all regulatory and procedural requirements. This includes 

expanded explanations of travel requirements on the CBP.gov website, such as “Know 

Before You Go” and the Western Hemisphere Travel Initiative (WHITI) Requirements 

page. CBP is working collaboratively with the carriers and airport authorities to 

improve instruction, signage, and on-board preprocessing. CBP is also working with 

industry to improve the traveler’s experience through the Rice-Chertoff Initiative, 

which will facilitate entry of air travelers into the U.S., and include new approaches for 

improving traveler processing and educating incoming travelers on U.S. laws, rules, 

and regulations. These efforts will improve passenger compliance in future years. 

Data Source: Homeland Enforcement Communication System (HECS), Categories I and II violations. 

Performance Measure—Land border passengers compliant with laws, rules, and regulations (%). 

Description: The compliance rate of land border vehicle passengers with all of the laws, rules, and 

regulations that CBP enforces at the Ports of Entry, with the exception of agriculture 

laws and regulations. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 99.9% 99.9% 99.9% 99.9% 99.9% 

Explanation of 

FY 2007 Results: 

Target Met—The FY 2006 vehicle passenger compliance rate, while maintained at 

the same rate over the last two years, is very high by historical standards, largely due 

to increased enforcement posture since September 11, 2001, and expanded efforts 

at educating the traveling public on travel requirements. CBP will continue its 

emphasis on targeting/enforcement and additional training for its employees and 

emphasize additional approaches to educating and informing the traveling public on 

U.S. laws and requirements. 

Data Source: Homeland Enforcement Communication System (HECS), Categories I and II violations. 

Performance Section 73 
Performance Summary


Performance Objective—Facilitate international trade and travel. 

Performance Measure—Average CBP exam reduction ratio for C-TPAT member importers compared to 

non-C-TPAT importers. 

Description: The exam reduction ratio of C-TPAT member importers compared to non C-TPAT 

importers. C-TPAT members to follow strict security procedures to secure the supply 

chain. This results in reduced exams and thereby helps facilitate the flow of trade. 

This performance measure indicates the impact of C-TPAT exam reduction benefits on 

C-TPAT importer exams. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A 4.1 Times Less 3.4 Times Less 3.5 Times Less 3.5 Times Less 

Explanation of 

FY 2007 Results: 

Target Met—The average CBP exam reduction ratio for C-TPAT member importers 

compared with that of non C-TPAT importers demonstrates how CBP facilitates trade 

transactions for known certified C-TPAT companies compared with non-C-TPAT 

importers. Examinations at arrival at the POEs, either through a manifest review or 

physical examination, are time consuming and costly to undergo. The reduction in 

such examinations for C-TPAT members when compared to non C-TPAT members is an 

excellent measure of a tangible benefit that translates to significant time-savings and 

reduced cost for importers. Importers have continued to work diligently to cooperate 

with CBP in this review process. 

Data Source: CBP Automated Commercial System (ACS) transaction data. 

Strategic Goal #5—Protecting America and Its Citizens 

Performance Objective—Reduce the importation of all prohibited or illegal drugs and other materials that 

are harmful to the public or may damage the American economy. 

Performance Measure—International air passengers in compliance with agricultural quarantine regulations 

(percent compliant). 

Key Highlight Target Not Met—See page 44 for results and detailed discussion. 

74 U .S . Customs and Border Protection • Performance and Accountability Report 
Performance Summary


Performance Measure—Border vehicle passengers in compliance with agricultural quarantine regulations 

(percent compliant). 

Description: The degree of compliance with U.S. Department of Agriculture (USDA) agricultural 

quarantine regulations and other mandatory agricultural product restrictions. CBP 

randomly samples border vehicle passengers for compliance with all USDA laws, 

rules and regulations using USDA guidance on sampling procedures. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: 96.0% 93.7% 92.9% 94.6% 95.7% 

Explanation of 

FY 2007 Results: 

Target Met—CBP has shown significant success in achieving increased compliance 

over the historical target rate of 95% previously maintained by USDA. CBP has been 

moving aggressively to fill Agricultural Specialist positions and made significant 

progress in FY 2007, filling over 300 positions. Improvements in staffing levels have 

resulted in improvements for FY 2007. High-risk land border environments are not yet 

fully staffed with trained CBP Agricultural Specialists and although CBP has achieved 

a big improvement in the rate of compliance for FY 2007, further improvements will 

be made as the remaining positions are filled. 

Data Source: USDA Work Accomplishment Data System (WADS) Agricultural Quarantine Inspection monitoring activities. 

Performance Objective—Provide support to protect events and key assets of national interest, and 

mitigate the risks of terrorism and other threats to critical Government operations. 

Performance Measure—Percent of air support launches accomplished to support border ground agents to 

secure the border. 

Key Highlight Target Met—See page 45 for results and detailed discussion. 

Performance Measure—Percent of at-risk miles under strategic air surveillance (strategic air coverage). 

Description: The percent of at-risk miles under strategic air surveillance evaluated according to upto-the-minute information and intelligence. This measure describes the area of the 

U.S. border determined to be under the span of control of CBP A&M assets. CBP 

A&M uses a multi-level layer to aerial response and support to accomplish this goal: 

1) strategic surveillance for the P-3 and UAS aircraft, 2) intelligence driven support for 

the rapid deployment of forces, and 3) strategic and tactical support to ground law 

enforcement such as the Office of Border Patrol and ICE. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A 55% 60% of 

at-risk miles 

60% 

Explanation of 

FY 2007 Results: 

Target Met—During FY 2007, the Grand Forks, North Dakota Air & Marine Branch 

was opened providing additional assets and resources along the Northern Border. 

Additional aircraft have been introduced into the fleet across all borders of the U.S., 

and additional Air Interdiction Agents have been hired which allows CBP A&M to 

extend its hours of operations to all borders. 

Data Source: SAP, CARMAC, APATS, CAMITS generated reports and analyst spreadsheets. 

Performance Section 75 
Performance Summary


Performance Measure—Numbers of airspace incursions along the southern border (extending the physical 

zone of security beyond the borders). 

Description: The number of airspace incursions along the southern border. The measure monitors 

A&M efforts in reducing, with the intent of ultimately denying, the use of border air 

space for acts of terrorism or smuggling using intelligence and threat assessments. 

CBP A&M continues to gather and analyze intelligence on past and current threat 

patterns to forecast and disseminate information about potential and emerging 

threats. The targeted goals for this measure are to maintain this low level of border 

incursions at a minimum and reduce it if possible, until there are no border 

incursions. 

Fiscal Year: FY 2004 

Actual 

FY 2005 

Actual 

FY 2006 

Actual 

FY 2007 

Target 

FY 2007 

Results 

Target/Actual Indicator: N/A N/A 13 10 32 

Explanation of 

FY 2007 Results: 

Target Not Met—The FY 2007 actual number of Targets of Interest (TOI) has 

increased primarily because of the revolving nature of smuggling. The increase in the 

numbers of Border Patrol ground forces in combination with the support of CBP A&M 

Air Interdiction Agents, has forced smugglers to change their focus from ground to 

airspace entrance into the U.S. In addition, on November 30, 2006, the Mexican 

government discontinued Operation HALCON which was an integral part of CBP’s 

defense-in-depth strategy. Operation HALCON was a joint U.S. and Mexican aviation 

training program designed to train Mexican pilots to fly and reduce U.S. border 

interdiction missions. 

Data Source: HECS, AMOR and validated real-time data. 

Strategic Goal #6—Modernizing and Managing 

Performance Objective—Maintain a reliable, stable, and secure IT infrastructure and an array of 

technical support services, including laboratory and scientific services, tactical radio communication, 

field equipment maintenance/support, and round-the-clock customer assistance. 

Performance Measure—Percent of time the Homeland Enforcement Communication System (HECS) is available to end users. 

Key Highlight Target Met—See page 46 for results and detailed discussion. 

76 U .S . Customs and Border Protection • Performance and Accountability Report 
Financial Section 
Message from the Chief Financial Officer


U.S. Customs and Border Protection (CBP) is going through dynamic change. 

The importance of our mission and the expectations to achieve the mission 

have increased along with CBP’s responsibilities and funding. Few missions in 

the Federal Government are more important than ours, as the men and women 

of CBP work continuously to protect our nation from dangerous people and 

dangerous goods. The Commissioner’s message has highlighted a few of the 

successes we realized in Fiscal Year 2007. 

The unqualified opinion on our Fiscal Year 2007 financial statements is a positive reflection that CBP continues to demonstrate discipline and accountability in 

the execution of our fiscal stewardship responsibilities. Our financial environment is complex—we not 

only receive appropriations like most Federal agencies, but we also rely on many user fees and collect 

significant custodial revenue. Several factors contribute to our financial management success. In my first 

year as CBP’s CFO, I have never seen a workforce more diligent and concerned about financial management and integrity. We have sound resource management practices, which we continuously assess and 

test, and change or reinforce as needed. And we have a modern enterprise resource planning system, 

SAP, now beginning its fourth year of operation. CBP performed an annual operational analysis of SAP to 

reflect the system’s current operational status and identify opportunities for improvements. We received 

a passing grade from the Department of Homeland Security under the Capital Planning and Investment 

Control process. 

As a mission support organization, the Office of Finance (OF) is part of the foundation of the administrative process that enables the men and women of CBP to accomplish our mission. OF is more than just 

finance—our diverse responsibilities range from finance and budget, to procurement and acquisition, 

to facilities and asset management. Like CBP, we are going through dynamic change. We launched two 

significant changes in Fiscal Year 2007 to evolve our support to CBP. The first change was the reorganization of the Asset Management Directorate, whose responsibilities had grown dramatically in size, 

complexity, and immediacy due to emphasis on border security programs. The result is a new Facilities 

and Engineering program, spun off from Asset Management. Asset Management will continue to be 

responsible for important programs such as vehicle fleet management, personal property, printing services and records management. The second change encompassed the creation of the Secure Border 

Initiative Acquisition Office. The Secure Border Initiative (SBI) is a massive, multi-dimensional effort that 

will enable us to gain better control of our borders. These changes represent our continuing dedication to 

CBP’s mission and financial stewardship. 

We are correcting issues identified by internal management evaluations in support of CBP’s Management 

Assurances, as well as auditor-identified weaknesses in internal controls. I can provide reasonable 

assurance that the objectives of Section 2 (Management Controls) and Section 4 (Financial Management Systems) of the Federal Managers’ Financial Integrity Act have been achieved. CBP is committed to 

addressing all of our financial management challenges by continuing to implement corrective measures 

that improve our oversight and accountability. 

78 U .S . Customs and Border Protection • Performance and Accountability Report 
In Fiscal Year 2008, CBP will continue to focus on the initiatives related to the President’s Management 

Agenda, fulfill the requirements of the Department of Homeland Security’s Financial Accountability Act, 

continue with the implementation of the Automated Commercial Environment, and continue to make 

improvements in CBP’s internal controls. Improvements in Asset Management and Facilities will continue. We are beginning to launch important improvements in investment management, which will enable 

CBP to better plan and execute capital investment. 

I would like to thank the men and women that make up this organization for the hard work they do 

every day. While processes and systems are important, first and foremost CBP and OF rely on our 

employees to get the job done. How we continue to grow, improve, and remain successful is our collective challenge. Our goal remains to provide timely, reliable, and useful financial management information to Congress and to the American public, and to enable the managers across CBP to make smart 

business decisions. 

Eugene H. Schied 

Chief Financial Officer 

November 13, 2007 

Financial Section 79 
Financial Statements


Customs and Border Protection


Consolidated Balance Sheet


As of September 30, 2007 and 2006


(In Thousands)


ASSETS (Note 2) 

Intragovernmental: 

Fund Balance with Treasury (Note 3)


Accounts Receivable (Note 5)


Receivables Due from Treasury – Refund and Drawback (Note 5)


Advances and Prepayments (Note 11)


Total Intragovernmental 

Cash and Other Monetary Instruments (Note 4)


Accounts Receivable, Net (Note 5)


Tax, Duties and Trade Receivables, Net (Note 6)


Inventory and Related Property, Net (Note 7)


General Property, Plant and Equipment, Net (Note 9)


Advances and Prepayments (Note 11)


TOTAL ASSETS 

Stewardship PP&E (Note 10) 

LIABILITIES (Note 12) 

Intragovernmental: 

Due to the Treasury General Fund


Accounts Payable


Accrued FECA Liability (Note 12)


Other


Employee Benefits and Taxes (Note 15)


Advances from Others (Note 15)


Total Intragovernmental 

2007 2006 

$ 7,196,406 

30,553 

175,870 

211,234 

7,614,063 

$10,367,400 

48,160 

412,427 

174,523 

11,002,510 

7,181 

151,402 

1,936,874 

76,817 

2,513,855 

417 

$12,300,609 

5,649 

162,707 

1,754,622 

67,166 

1,924,891 

605 

$14,918,150 

$ 2,078,305 

342,049 

129,558 

$ 1,799,521 

122,934 

118,226 

42,299 

9,375 

$ 2,601,586 

35,335 

7,970 

$ 2,083,986 

(Continued) 

80 U.S. Customs and Border Protection • Performance and Accountability Report 
Financial Statements


Customs and Border Protection 

Consolidated Balance Sheet (continued) 

As of September 30, 2007 and 2006 

(In Thousands) 

2007 2006 

Accounts Payable 635,306 377,817 

Accrued Payroll and Benefits (Note 13) 1,031,557 926,276 

Environmental & Disposal Liabilities (Note 12 and 14) 12,369 15,823 

Liabilities for Antidumping/Countervailing Duties 597,907 199,254 

Software License Agreements (Note 12 and 16) 47,680 61,691 

Legal Contingent Liabilities (Note 17) 83,463 62,196 

Other 

Refunds Payable (Note 15) 131,053 5,593,334 

Injured Domestic Industries (Note 15) 388,138 475,751 

TOTAL LIABILITIES $ 5,529,059 $ 9,796,128 

Commitment and Contingencies (Note 17) 

NET POSITION: 

Unexpended Appropriations 4,124,660 2,971,412 

Cumulative Results of Operations – Earmarked Funds (Note 18) 1,027,476 1,094,642 

Cumulative Results of Operations – Other Funds 1,619,414 1,055,968 

TOTAL NET POSITION $ 6,771,550 $ 5,122,022 

TOTAL LIABILITIES AND NET POSITION $12,300,609 $14,918,150 

The accompanying notes are an integral part of these statements. 

Financial Section 81 
Financial Statements


Customs and Border Protection 

Consolidated Statements of Net Cost 

For the Years Ended September 30, 2007 and 2006 

(In Thousands) 

2007 2006 

Office of Field Operations Border Security Inspections and Trade 

Facilitation at Ports of Entry 

Gross Cost $5,140,275 $4,693,579 

Less: Earned Revenue 203,479 195,216 

Net Program Costs $4,936,796 $4,498,363 

Border Security and Control Between Ports of Entry 

Gross Cost $2,844,570 $2,250,496 

Less: Earned Revenue 112,604 93,603 

Net Program Costs $2,731,966 $2,156,893 

Air and Marine Operations 

Gross Cost $ 369,251 $ 350,887 

Less: Earned Revenue 14,617 14,594 

Net Program Costs $ 354,634 $ 336,293 

Total Gross Cost $8,354,096 $7,294,962 

Less: Total Earned Revenue 330,700 303,413 

Net Cost of Operations (Note 19 and 20) $8,023,396 $6,991,549 

The accompanying notes are an integral part of these statements. 

82 U.S. Customs and Border Protection • Performance and Accountability Report 
Financial Statements


Customs and Border Protection


Consolidated Statement of Changes in Net Position


For the Year Ended September 30, 2007


(In Thousands)


FY 2007 

Earmarked All Other Consolidated 

Funds Funds Total 

Cumulative Results of Operations: 

Beginning Balances $ 1,094,642 $ 1,055,968 $ 2,150,610 

Budgetary Financing Sources: 

Appropriations Used — 5,614,963 5,614,963 

Non-exchange Revenue (Note 21) 2,421,788 5,332 2,427,120 

Transfers in/out without Reimbursement (Note 21) (1,551,659) 1,808,507 256,848 

Other — (92,140) (92,140) 

Other Financing Sources (Non-Exchange): 

Donations and Forfeitures of Property — 3,618 3,618 

Transfers in/out without Reimbursement (49) 3,558 3,509 

Imputed Financing — 305,758 305,758 

Total Financing Sources 870,080 7,649,596 8,519,676 

Net Cost of Operations (937,246) (7,086,150) (8,023,396) 

Net Change (67,166) 563,446 496,280 

Cumulative Results of Operations $ 1,027,476 $ 1,619,414 $ 2,646,890 

Unexpended Appropriations: 

Beginning Balance — 2,971,412 2,971,412 

Budgetary Financing Sources: 

Appropriations Received (Note 23) — 6,733,265 6,733,265


Appropriations Transferred in/out — 62,883 62,883


Other Adjustments — (27,937) (27,937)


Appropriations Used — (5,614,963) (5,614,963)


Total Budgetary Financing Sources — 1,153,248 1,153,248


Total Unexpended Appropriations — 4,124,660 4,124,660 

Net Position $ 1,027,476 $ 5,744,074 $ 6,771,550 

The accompanying notes are an integral part of these statements. 

Financial Section 83 
Financial Statements


Customs and Border Protection


Consolidated Statement of Changes in Net Position


For the Year Ended September 30, 2006


(In Thousands)


FY 2006 

Earmarked All Other Consolidated 

Funds Funds Total 

Cumulative Results of Operations: 

Beginning Balances $ 1,057,701 $ 966,270 $ 2,023,971 

Budgetary Financing Sources: 

Appropriations Used — 4,460,061 4,460,061 

Non-exchange Revenue (Note 21) 2,367,316 5,289 2,372,605 

Transfers in/out without Reimbursement (Note 21) (1,469,510) 1,609,860 140,350 

Other — (153,327) (153,327) 

Other Financing Sources: 

Donations and Forfeitures of Property — 6,497 6,497 

Transfers in/out without Reimbursement 49 40,879 40,928 

Imputed Financing — 251,074 251,074 

Total Financing Sources 897,855 6,220,333 7,118,188 

Net Cost of Operations (860,914) (6,130,635) (6,991,549) 

Net Change 36,941 89,698 126,639 

Cumulative Results of Operations $ 1,094,642 $ 1,055,968 $ 2,150,610 

Unexpended Appropriations: 

Beginning Balance — 2,070,402 2,070,402 

Budgetary Financing Sources: 

Appropriations Received (Note 23) — 5,440,771 5,440,771


Appropriations Transferred in/out — (15) (15)


Other Adjustments — (79,685) (79,685)


Appropriations Used — (4,460,061) (4,460,061)


Total Budgetary Financing Sources — 901,010 901,010


Total Unexpended Appropriations — 2,971,412 2,971,412 

Net Position $ 1,094,642 $ 4,027,380 $ 5,122,022 

The accompanying notes are an integral part of these statements. 

84 U.S. Customs and Border Protection • Performance and Accountability Report 
Financial Statements


Customs and Border Protection 

Combined Statements of Budgetary Resources 

For the Years Ended September 30, 2007 and 2006 

(In Thousands) 

2007 2006 

Budgetary Resources: 

Unobligated Balances Brought Forward, October 1 $ 2,295,543 $ 1,724,244 

Recoveries of Prior Year Unpaid Obligations 198,505 217,202 

Budget Authority: 

Appropriation (Note 23) 11,190,407 9,253,801 

Spending Authority from Offsetting Collections: 

Earned: 

Collected 1,514,055 1,290,526 

Change in Receivable from Federal Sources (33,960) 9,849 

Change in Unfilled Customer Orders: 

Advance Received (2,401) 1,400 

Without Advance from Federal Sources (20,196) 42,063 

Expenditure Transfers from Trust Funds 3,026 3,000 

Subtotal 12,650,931 10,600,639 

Nonexpenditure Transfers from Trust Funds 373,904 243,863 

Permanently Not Available (102,524) (162,676) 

Total Budgetary Resources $15,416,359 $12,623,272 

Status of Budgetary Resources: 

Obligations Incurred: (Note 22) 

Direct $11,034,771 $ 9,032,372 

Reimbursable 1,486,683 1,295,357 

Subtotal 12,521,454 10,327,729 

Unobligated Balance: 

Apportioned 16,641 293,495 

Exempt from Apportionment — 328 

Subtotal 16,641 293,823 

Unobligated Balance Not Available 2,878,264 2,001,720 

Total Status of Budgetary Resources $15,416,359 $12,623,272 

(Continued) 

The accompanying notes are an integral part of these statements. 

Financial Section 85 
Financial Statements


Customs and Border Protection 

Combined Statement of Budgetary Resources (continued) 

For the Years Ended September 30, 2007 and 2006 

(In Thousands) 

2007 2006 

Change in Obligated Balances: 

Obligated Balance, Net 

Unpaid Obligations, Brought Forward, October 1 $ 3,067,174 $ 2,397,626 

Uncollected Customer Payments from Federal Sources, 

Brought Forward, October 1 (374,941) (323,029) 

Total Unpaid Obligated Balance, Net 2,692,233 2,074,597 

Obligations Incurred, Net 12,521,454 10,327,729 

Gross Outlays (11,354,401) (9,440,979) 

Obligated Balance Transferred, Net 

Actual Transfers, Unpaid Obligations 34,008 — 

Recoveries of Prior Year Unpaid Obligations, Actual (198,505) (217,202) 

Change In Uncollected Customer Payments From Federal Sources 54,156 (51,912) 

Obligated Balance, Net End Of Period 

Unpaid Obligations 4,069,728 3,067,174 

Uncollected Customer Payments from Federal Sources (320,785) (374,941) 

Total, Unpaid Obligated Balance, Net, End of Period 3,748,943 2,692,233 

Net Outlays: 

Gross Outlays 11,354,401 9,440,979 

Offsetting Collections (1, 514,680) (1,294,926) 

Distributed Offsetting Receipts (2,360,600) (2,347,944) 

Total Net Outlays $ 7,479,121 $ 5,798,109 

The accompanying notes are an integral part of these statements. 

86 U.S. Customs and Border Protection • Performance and Accountability Report 
Financial Statements


Customs and Border Protection 

Consolidated Statement of Custodial Activity 

For the Years Ended September 30, 2007 and 2006 

(In Thousands) 

2007 2006 

Revenue Activity: 

Sources of Cash Collections: 

Duties $26,657,868 $24,729,875 

User Fees 1,307,306 1,241,961 

Excise Taxes 2,626,443 2,426,725 

Fines and Penalties 56,321 51,224 

Interest 13,277 8,649 

Miscellaneous 2,548 11,431 

Total Cash Collections 30,663,763 28,469,865 

Accrual Adjustments (+/–) 5,727,469 (5,371,096) 

Total Custodial Revenue $36,391,232 $23,098,769 

Disposition of Collections: 

Transferred to Others: 

Treasury General Fund Accounts $23,542,946 $27,137,083 

U.S. Department of Agriculture 147,421 126,608 

Other Federal Agencies 21,214 16,661 

Government of Puerto Rico 14,158 14,424 

Government of the U.S. Virgin Islands 5,299 6,435 

Refunds and Drawbacks (Note 27) 6,922,034 1,160,051 

Non-federal Other 13,229 8,603 

(Increase)/Decrease in Amounts Yet to be Transferred 5,724,931 (5,371,096) 

Total Disposition of Custodial Revenue 36,391,232 23,098,769 

Net Custodial Activity $ — $ — 

The accompanying notes are an integral part of these statements. 

Financial Section 87 
Notes to Financial Statements


Notes to Financial Statements 

1. Significant Accounting Policies 

Reporting Entity 

U.S. Customs and Border Protection (CBP), was created on March 1, 2003, and is a component of the 

U.S. Department of Homeland Security (DHS). CBP is the unified border agency whose priority mission 

is the prevention of terrorist and terrorist weapons from entering the U.S. CBP is also responsible for 

administering the U.S. Trade Program and U.S. Narcotics Enforcement Program. CBP meets these 

responsibilities by: (1) enforcing the laws governing the flow of merchandise or commerce across the borders of the U.S., (2) assessing and collecting duties, taxes and fees on imported and other goods and 

services, and (3) enforcing drug-related and other laws and regulations of the U.S. on behalf of federal 

agencies and/or in conjunction with various state, local, and other federal agencies and foreign countries. 

Substantially all of the duty, tax, and fee revenues collected by CBP are remitted to various general fund 

accounts maintained by Treasury. Treasury further distributes these revenues to other federal agencies 

in accordance with various laws and regulations. CBP transfers the remaining revenue (generally less 

than one percent of revenues collected) directly to other federal agencies, the Governments of Puerto 

Rico and the U.S. Virgin Islands. Refunds of revenues collected from import/export activity are recorded 

in separate accounts established for this purpose and are funded through permanent indefinite appropriations. These activities reflect the non-entity or custodial responsibilities that CBP, as an agency of 

the Federal Government, has been authorized by law to enforce. 

Basis of Accounting and Presentation 

These financial statements have been prepared from CBP accounting records in conformity with generally accepted accounting principles (GAAP). GAAP for federal entities are the standards prescribed by the 

Federal Accounting Standards Advisory Board, which was designated the official accounting standardsetting body of the Federal Government by the American Institute of Certified Public Accountants. The 

statements consist of the Consolidated Balance Sheet, the Consolidated Statement of Net Cost, the 

Consolidated Statement of Changes in Net Position, the Combined Statement of Budgetary Resources, 

and the Consolidated Statement of Custodial Activity. 

These financial statements should be read with the realization that they are for a component of a sovereign entity; that liabilities not covered by budgetary resources cannot be liquidated without the enactment of an appropriation, and that payment of liabilities other than for contracts can be abrogated by 

the sovereign entity. 

These financial statements, with respect to the Consolidated Balance Sheet, the Consolidated Statement of Net Cost and the Consolidated Statement of Changes in Net Position, are reported using the 

accrual basis of accounting. Under the accrual basis of accounting, revenues are recognized when 

earned and expenses are recognized when a liability is incurred without regard to receipt or payment 

of cash. The Combined Statement of Budgetary Resources is reported using the budgetary basis of 

accounting. Budgetary accounting facilitates compliance with legal constraints and controls over the 

use of federal funds. It generally differs from the accrual basis of accounting in that obligations are 

88 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


recognized when new orders are placed, contracts awarded and services received that will require payments during the same or future period. CBP non-entity revenue and refunds are reported on the Consolidated Statement of Custodial Activity using a modified cash basis. With this method, revenue from 

cash collections are reported separately from receivable accruals and cash disbursements are reported 

separately from payable accruals. 

In accordance with OMB Circular A-136, intra-CBP transactions and balances have been eliminated from 

the Consolidated Balance Sheet, Consolidated Statement of Net Cost, and the Consolidated Statement 

of Changes in Net Position. As provided for by OMB Circular A-136, the Combined Statement of Budgetary Resources is presented on a combined basis; therefore, intra-CBP transactions and balances have 

not been eliminated from this statement. 

Effective FY 2007, the Statement of Financing was removed as a basic financial statement. Federal 

agencies are now required to disclose the reconciliation of net cost of operations to budgetary accounts 

in a note to the financial statements in accordance with OMB Circular No. A-136. Accordingly, CBP presented comparative FY 2007 and FY 2006 reconciliation of net cost of operations to budget. See Note 

28 for specific disclosure related to CBP’s Reconciliation of Net Cost of Operations to Budget. 

Earmarked Funds 

The Statement of Federal Accounting Standards (SFFAS) No. 27, Identifying and Reporting Earmarked 

Funds, requires separating dedicated collections into two categories, earmarked and fiduciary activity. 

See Note 18, Earmarked Funds, for specific required disclosures related to CBP’s earmarked funds. 

CBP has program management responsibility for the following earmarked funds: 

Appropriation Title 

70X5087 CBP - Immigration User Fees 

70X5695 Customs User Fees Account 

70X5089 Land Border Inspection Fees 

70X5451 Enforcement Fines Account 

70X5694 Small Airport User Fees 

70X8870 Harbor Maintenance Fee Collections 

Assets and Liabilities 

Intragovernmental assets and liabilities result from activity with other federal agencies. All other assets 

and liabilities result from activity with parties outside the Federal Government, such as domestic and 

foreign persons, organizations or governments. 

Fund Balance with Treasury, Cash and Other Monetary Assets 

Entity Fund Balance with Treasury are the amounts remaining as of September 30, 2007 and 2006 from 

which CBP is authorized to make expenditures and pay liabilities resulting from operational activity, 

except as restricted by law. Non-entity Fund Balance with Treasury represents funds available to pay 

Financial Section 89 
Notes to Financial Statements


refunds and drawback claims of duties, taxes, fees, and other non-entity amounts to be distributed to 

the Treasury General Fund and other Federal accounts in a future period. 

A timing difference occurs when cash is received and applied to a specific revenue type in one period, 

and the deposit occurs in a future period. Monetary instruments are held by CBP in lieu of an importer/ 

broker filing a surety bond. Corresponding liabilities are recorded for amounts expected to be allocated in 

future periods to federal agencies. 

Advances and Prepayments 

Intragovernmental advances and prepayments consist of amounts paid to federal agencies prior to CBP 

receipt of goods and services. Advances and prepayments to the public consist primarily of prepaid rent. 

Accounts Receivable 

Intragovernmental accounts receivable represent amounts due from federal agencies. These receivables 

are expected to be fully collected. Accounts receivable from reimbursable services and user fees represent amounts due from non-federal sources for services performed. By law, collections of these receivables can be credited to the appropriation accounts from which the related costs were paid. These receivables are net of amounts deemed uncollectible which are determined by considering the debtor’s current 

ability to pay, the debtor’s payment record and willingness to pay, the probable recovery of amounts from 

secondary sources, such as sureties, and an analysis of aged receivable activity. The user fee receivable 

is based on a calculated estimate using historical user fee receivables. 

Title 19 of the United States Code, chapter 1, section 58c, authorizes CBP, formerly known as the United 

States Customs Service, to collect user fees for services provided in connection with the processing 

of commercial air and commercial vessel passengers, loaded or partially loaded railroad cars carrying 

passengers or commercial flights arriving into the customs territory as defined in general note 2 of the 

Harmonized Tariff Schedule of the United States (some exceptions apply). 

Receivables accrue for commercial airline and commercial vessel fees on a quarterly basis and the payments are due to CBP within thirty-one days after the close of the calendar quarter in which the fees are 

collected. Railroad car fees accrue on a monthly basis and the payments are due to CBP on or before 

the date that is 60 days after the applicable month. 

Title 8 of the United States Code, chapter 12, subchapter II, part IX, section 1356 authorizes CBP, to 

collect immigration user fees for inspection or pre-inspection of passengers arriving at a port of entry in 

the United States (as defined in Title 8, chapter 12, subchapter I, section 1101) aboard a commercial 

aircraft and commercial vessel (some exceptions apply). Receivables accrue for commercial airline and 

commercial vessel user fees on a quarterly basis. Payment is due any time within thirty-one days after 

the quarter in which the fees are collected, except the July and August fees collected from airline passengers shall be made ten days before the end of the fiscal year. The first quarter payment shall include 

any collections made in the preceding quarter that were not remitted with the previous payment. 

90 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


Receivable Due from Treasury and Due to the Treasury General Fund 

The Receivable Due from Treasury represents amounts to be provided by Treasury to fund accrued liabilities of duty, tax and/or fee refunds and drawbacks. Due to the Treasury General Fund is the offsetting 

liability to non-entity collections and non-entity receivables. 

Tax, Duties and Trade Receivables 

Accounts receivable consist of duties, user fees, fines and penalties, refunds and drawback overpayments, and interest associated with import/export activity, which have been established as a specifically 

identifiable, legally enforceable claim and remain uncollected as of year-end. These receivables are net 

of amounts deemed uncollectible which were determined by considering the debtor’s payment record 

and willingness to pay, the probable recovery of amounts from secondary sources, such as sureties, and 

an analysis of aged receivable activity. CBP’s non-entity receivables are described in more detail in Note 

6, Tax, Duties and Trade Receivables, Net. 

Inventory and Related Property 

Inventory and Related Property consist of aircraft and marine parts and materials to be used in CBP’s 

operations. Aircraft parts and materials are recorded at average unit cost, and marine parts and materials are recorded using the First-In-First-Out valuation method. Both methods approximate actual acquisition costs. When ultimately used in CBP operations, an operating expense is recorded. 

Seized and Forfeited Property 

Prohibited seized and forfeited property results primarily from CBP criminal investigations and passenger/ 

cargo processing. Seized property is not considered an asset of CBP and is not reported as such in 

CBP’s financial statements; however, CBP has a stewardship responsibility until the disposition of the 

seized items are determined. Non-prohibited seized property, including monetary instruments, real 

property and tangible personal property of others in the actual or constructive possession of CBP will be 

transferred to the Treasury Forfeiture Fund and is not presented in the accompanying CBP Consolidated 

Balance Sheet or Note 8, Seized and Forfeited Property. 

Forfeited property is property for which the title has passed to the U.S. Government. As noted above, 

non-prohibited forfeited property or currency becomes assets of the Treasury Forfeiture Fund. However, 

prohibited forfeited items, such as counterfeit goods, narcotics, or firearms, are held by CBP until disposed or destroyed. In accordance with Statement of Federal Financial Accounting Standards (SFFAS) 

No. 3, Accounting for Inventory and Related Property, analyses of changes in seized and forfeited property 

of prohibited items are disclosed in Note 8, Seized and Forfeited Property. 

General Property, Plant and Equipment 

CBP capitalized property, plant and equipment with an acquisition value of $5,000 or greater and a 

useful life of 2 years or greater if acquired prior to October 1, 1995. Beginning October 1, 1995, CBP 

capitalizes property, plant and equipment with an acquisition value of $50,000 or greater, and a useful 

life of 2 years or greater. The property, plant, and equipment assets acquired by CBP from the former 

Immigration and Naturalization Service as part of the formation of the Department of Homeland Security 

Financial Section 91 
Notes to Financial Statements


were capitalized if the acquisition value was $25,000 or greater. As of October 1, 2000, CBP implemented SFFAS No. 10, Accounting for Internal Use Software. SFFAS No. 10 requires the capitalization of 

all internal use software, including commercial off-the-shelf, contractor developed and internally developed software. As a result, CBP began capitalizing costs associated with the development of internal 

use software. In addition, CBP implemented the SFFAS No. 10 recommendation to apply capital lease 

accounting concepts to software license fee agreements that give CBP the “right to use” the software. 

Prior to October 1, 2000, costs relating to the development of internal use software and “right to use” 

license agreements were expensed. 

Expenditures for normal repairs and maintenance are charged to expense as incurred. Expenditures 

greater than $50,000 for improving or rebuilding an asset and increases an asset’s useful life are capitalized. Prior to October 1, 1995, expenditures greater than $5,000 for improving or rebuilding an asset 

and that increased an asset’s useful life were capitalized. 

Depreciation and amortization are computed using the straight line method over the estimated useful 

lives of the assets ranging from 2 to 30 years for equipment and software, 2 to 30 years for leasehold 

improvements, and 6–40 years for buildings, structures and land improvements. Amortization of capitalized software begins on the date of acquisition if purchased or when the module or component has been 

successfully tested if contractor or internally developed. 

Commercial/Travel Payable 

A liability is recorded for an accounts payable accrual from commercial/travel activities. A portion of this 

liability is determined using a calculated estimate. This estimate is based on a ratio developed using 

historical subsequent disbursements and undelivered orders and applying the ratio to the undelivered 

orders as of September 30, 2007 and 2006. 

Other Non-Entity Items in CBP Custody 

CBP has the authority, in accordance with provisions of the Federal Crime Code and Federal Rules of 

Criminal Procedures, to retain property within its custody for evidentiary purposes. Because this property 

is not seized under seizure and forfeiture laws, it cannot become property of the U.S. Government and is 

intended to be returned to the owner at some future date. This evidence is not disclosed in the financial 

statements or a related note as the amount is not significant, but does represent a fiduciary responsibility of CBP. 

Accrued Annual, Sick and Other Leave and Compensatory Time 

Annual leave, compensatory time and other leave time are accrued when earned. The accrual is presented as a component of the payroll and benefits liability in the Consolidated Balance Sheet and is 

adjusted for changes in compensation rates and reduced for annual leave taken. Sick leave is not 

accrued when earned, but is expensed when taken. For additional information see Note 13, Accrued 

Payroll and Benefits. 

92 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


Pension Costs, Other Retirement Benefits and Other Post-Employment Benefits 

Most CBP employees hired prior to January 1, 1984 participate in the Civil Service Retirement System 

(CSRS). CBP contributes 8.5 percent of base pay for regular employees, and 9 percent for law enforcement agents. Employees hired after December 31, 1983 are automatically covered by the Federal 

Employees’ Retirement System (FERS) and Social Security. A primary feature of FERS is that it offers a 

savings plan to which CBP automatically contributes 1 percent of base pay and matches any employee 

contributions up to an additional 4 percent of base pay. For most employees hired after December 31, 

1983, CBP also contributes the employee’s matching share for Social Security. For the FERS basic 

benefit CBP contributes 11.2 percent of base pay for regular employees and 23.8 percent for law 

enforcement agents. The pay base for determining CBP contributions to CSRS and FERS for inspectors 

and canine officers includes regular pay and up to a maximum of $17,500 in certain overtime earnings 

for FY 2007 and 2006. CBP recognizes the full costs of its employees’ pension benefits; however, the 

liability associated with these costs is recognized by the Office of Personnel Management (OPM). 

Similar to Federal retirement plans, OPM, rather than CBP, reports the liability for future payments to 

retired employees who participate in the Federal Employees Health Benefits Program and the Federal 

Employees Group Life Insurance Program. 

A liability for other post-employment benefits, which includes all types of benefits to former or inactive 

(but not retired) employees, their beneficiaries, and covered dependents, is also recognized. For additional information see Note 13, Accrued Payroll and Benefits. 

Workers’ Compensation 

A liability is recorded for actual and estimated future payments to be made for workers’ compensation 

pursuant to the Federal Employees’ Compensation Act (FECA). The actual liability is presented as a component of intragovernmental other liabilities and the actuarial liability is presented as Federal Employee 

and Veterans Benefits in the accompanying Consolidated Balance Sheet. The FECA program is administered by the U.S. Department of Labor (DOL), which initially pays valid claims and subsequently seeks 

reimbursement from federal agencies employing the claimants. Reimbursement to DOL on payments 

made usually occurs approximately two years subsequent to the actual disbursement. Budgetary 

resources for this intragovernmental liability are made available to CBP as part of its annual appropriation from Congress in the year in which the reimbursement takes place. 

Additionally, the actuarial liability due to the public includes the expected liability for death, disability, 

medical and miscellaneous costs for approved compensation cases. The liability is determined using a 

method that utilizes historical benefit payment patterns related to a specific incurred period to predict 

the ultimate payments related to that period. Based on information provided by DOL, DHS allocates the 

actuarial liability to its components and department offices based on the payment history for the components and department offices. The accrued liability is not covered by budgetary resources and will 

require future funding. 

Financial Section 93 
Notes to Financial Statements


Unexpended Appropriations 

Unexpended appropriations represent the amount of CBP unexpended appropriated spending authority 

as of fiscal year-end that is unliquidated or is unobligated and has not lapsed, been rescinded or 

withdrawn. 

Cumulative Results of Operations 

Cumulative Results of Operations primarily represent the excess of user fee revenues over related 

expenses. It also reflects the net investment in Property, Plant and Equipment, Inventory and Related 

Property held for use, and transfers in of equipment, materials and supplies from other federal agencies 

without reimbursement. Also, included as a reduction in Cumulative Results of Operations, are liabilities 

incurred, which will require funding from future appropriations, such as accumulated annual and other 

leave earned but not taken, accrued workers’ compensation and contingent liabilities. The portion of 

Cumulative Results of Operations attributable to earmarked funds is shown separately on both the 

Consolidated Statement of Changes in Net Position and the Consolidated Balance Sheet. For additional 

information see Note 18, Earmarked Funds. 

Revenue, Financing Sources and Expense Recognition 

CBP entity activities are financed principally through appropriations, exchange revenue and non-exchange 

revenue. Appropriations used are recognized as a financing source when expenses are incurred or 

assets are purchased. Exchange revenues from reimbursable services and intragovernmental reimbursable activity are recognized as earned when the goods or services are provided and reflect the full cost 

of the goods or services provided. Non-exchange revenue from user fees is recognized as earned in 

accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended. CBP may 

retain the user fee revenues and expend them as authorized by law for CBP inspector overtime and other 

activities directly related to the services to which the fees relate. An imputed financing source is also 

recognized to offset costs incurred by CBP but funded by another federal source, generally in the period 

in which the cost was incurred. Expenses are recognized when goods or services are received, when 

inventory is used, or assets are depreciated or amortized. 

The FY 2007 and 2006 activities reported on the Consolidated Statement of Net Cost contain all 

resource costs assigned from CBP cost centers. All field operational cost centers were surveyed for time 

spent in the Passenger Processing, Trade Compliance, Outbound Operations and field Mission Support 

activities. For enforcement operational cost centers, the time spent in the activities was extracted from 

the Customs Electronic Data Warehouse. Time reported by the field and enforcement operational cost 

centers is also used to assign mission support and overhead costs to “front-line” activities. 

Non-entity Revenue is recognized when the cash CBP is entitled to collect on behalf of the Federal 

Government is received. Primarily, these revenue collections result from current fiscal year activities. The 

significant types of revenues collected and related disbursements are described below: 

•	 Duties: amounts collected on imported goods. 

•	 User fees: amounts collected for certain services as provided by law. 

•	 Excise taxes: amounts collected on imported distilled spirits, wines and tobacco products, and other 

miscellaneous taxes collected on behalf of the Federal Government. 

94 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


•	 Fines and penalties: amounts collected for violations of laws and regulations. 

•	 Refunds: payments made to importers/exporters are primarily identified when the import entries are 

liquidated, a process in which CBP makes final determination of duties, taxes, fees and interest owed 

on each entry and compares it to the estimated amount previously determined and paid by the 

importer/broker. Interest is included in the refund generally for the period of time between when the 

estimated amounts were received from the importer/broker and the time the entry is liquidated. When 

a refund is identified prior to liquidation, the refund from this remittance is funded from the duty, tax 

or fee collections rather than from the Refunds and Drawback Account. 

•	 Drawback: a remittance, in whole or in part, of duties, taxes or fees. Drawback typically occurs when 

the imported goods on which duties, taxes or fees have been previously paid are subsequently 

exported from the United States or destroyed prior to entering the commerce of the United States. 

Depending on the type of claim, the claimant has up to six or eight years from the date of importation 

to file for drawback. 

A financing source for refunds and drawback is recognized when payment is made. The financing source, 

representing the permanent, indefinite appropriation account used to fund the disbursement, is recorded 

as a decrease in the amount transferred to Treasury General Fund Accounts reported on the Statement 

of Custodial Activity. 

An accrual adjustment is included to adjust cash collections and refund disbursements with the net 

increase or decrease of accrued Non-entity Accounts Receivables, net of uncollectible amounts and 

refunds payable. CBP will also take into custody, without risk or expense, merchandise termed “general 

order property” which for various reasons cannot legally enter into the commerce of the United States. 

CBP’s sole responsibility for the general order property is to ensure the property does not enter into 

U.S. commerce. If general order property remains in CBP custody for a prescribed period of time, without 

payment of all estimated duties, storage and other charges, the property is considered unclaimed and 

abandoned and can be sold by CBP at public auction. Auction sales revenue in excess of charges associated with the sale or storage of the item is remitted to the Treasury General Fund. In some cases, CBP 

incurs charges prior to the sale and funds these costs from entity appropriations. Regulations permit 

CBP to offset these costs of sale before returning excess amounts to Treasury. Proceeds from the sale 

of general order property totaled $5.6 million and $9 million for the years ended September 30, 2007 

and 2006, respectively. Excess amounts returned to the Treasury General Fund totaled $478 thousand 

and $908 thousand for the years ended September 30, 2007 and 2006, respectively. 

Use of Estimates 

Management has made certain estimates and assumptions in the reporting of assets, liabilities and 

note disclosures in the Consolidated Balance Sheet, the Consolidated Statement of Net Cost, the 

Consolidated Statement of Changes in Net Position, the Combined Statement of Budgetary Resources, 

the Consolidated Statement of Custodial Activity and accompanying notes. Actual results could differ 

from these estimates. Significant estimates include: year-end accruals of accounts payable, contingent 

legal and environmental liabilities, accrued workers’ compensation, allowance for doubtful accounts 

receivable, retirement and post-retirement benefits assumptions and certain non-entity receivables and 

payables related to custodial activities. 

Financial Section 95 
Notes to Financial Statements


Taxes 

CBP, as a federal component, is not subject to federal, state or local income taxes and accordingly, no 

provision for income taxes has been recorded in the accompanying financial statements. 

Reclassifications 

Certain FY 2006 balances have been reclassified, re-titled, or combined with other financial statement 

line items for consistency with current year presentation. 

2. Non-entity Assets 

Non-entity assets as of September 30, 2007 and 2006, consist of the following (in thousands): 

Intragovernmental:

 Fund Balance with Treasury (Note 3) 

 Receivables Due from Treasury (Note 5) 

Total Intragovernmental 

Public: 

Accounts Receivable, Net


Cash and Other Monetary Instruments (Note 4)


Tax, Duties and Trade Receivables, Net (Note 6)


Property, Plant and Equipment, Net


Total Public 

Total Non-Entity Assets 

Total Entity Assets 

Total Assets 

Non-entity Fund Balance with Treasury as of September 30, 2007 and 2006 includes approximately 

$465 million and $5.2 billion (in deposit fund) in duties collected by CBP for unliquidated anti-dumping/ 

countervailing duties and $574 million and $566 million (in special fund) for Injured Domestic Industries 

as of September 30, 2007 and 2006, respectively. These assets offset accrued liabilities as of September 30, 2007 and 2006. 

Non-entity Fund Balance with Treasury consists of special and deposit funds, permanent appropriations, 

and miscellaneous receipts that are available to pay non-entity liabilities. Non-entity Receivables Due 

from Treasury represent an estimate of duty, tax, and/or fee refunds and drawbacks that will be reimbursed by a permanent and indefinite appropriation account. Duties and taxes receivable from the public 

represent amounts due from importers for goods and merchandise imported to the United States and, 

upon collection, will be available to pay the accrued intragovernmental liability Due to the Treasury 

General Fund, which equaled $2.1 billion and $1.8 billion as of September 30, 2007 and 2006. 

2007
 2006


$ 1,123,689 $ 5,944,570 

175,870 412,427 

1,299,559 6,356,997 

2,538 — 

5,207 5,305 

1,936,874 1,754,622 

2,423 2,628 

1,947,042
 1,762,555


3,246,601 8,119,552 

9,054,008 6,798,598 

$12,300,609 $14,918,150 

96 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


3. Fund Balance with Treasury 

Fund Balance with Treasury as of September 30, 2007 and 2006 consists of the following 

(in thousands): 

2007 

Trust Funds 

General Funds 

Special Funds 

Deposit Funds 

Totals 

Entity 

$ 5,902 

5,128,074 

934,181 

4,560 

$6,072,717 

Non-Entity 

$ — 

84,774 

573,703 

465,212 

$1,123,689 

Totals 

$ 5,902 

5,212,848 

1,507,884 

469,772 

$ 7,196,406 

2006 

Trust Funds 

General Funds 

Special Funds 

Deposit Funds 

Totals 

Entity 

$ 8,563 

3,409,454 

1,001,243 

3,570 

$4,422,830 

Non-Entity 

$ — 

163,949 

566,127 

5,214,494 

$5,944,570 

Totals 

$ 8,563 

3,573,403 

1,567,370 

5,218,064 

$10,367,400 

General funds consist of amounts appropriated annually by Congress to fund the operations of CBP. 

The non-entity general fund balance represents permanent, indefinite appropriations to pay refunds and 

drawback claims of duties, taxes, or fees. The balance is presented as a non-entity balance because 

the refund and drawback payments are associated with CBP custodial activity of collecting revenue on 

behalf of the Federal Government. 

Trust funds are both receipt accounts and expenditure accounts that are designated by law as a trust 

fund. The entity trust fund balances result from CBP authority to use the proceeds from general order 

items sold at auction to offset specific costs incurred by CBP relating to their sale, and to use available 

funds from the Harbor Maintenance Fee Trust Fund to offset administrative expenses related to the 

collection of the Harbor Maintenance Fee. 

Special funds are receipt funds used for specific purposes. Entity amounts comprising the special fund 

balances result from CBP authority to assess and collect passenger and conveyance-related user fees, 

CBP authority to assess and collect fees associated with services performed at certain small airports or 

other facilities, and CBP authority to retain amounts needed to offset costs associated with collecting 

duties, taxes, and fees for the Government of Puerto Rico. As of September 30, 2007 and 2006, CBP 

User Fees Account contained approximately $729.9 million and $761.1 million, respectively; CBP Services at Small Airports account contained approximately $10.4 million and $8 million, respectively; and 

the Refunds, Transfers and Expenses of Operation of Puerto Rico account contained approximately 

$32.9 million and $31.8 million respectively. CBP also has entity special funds for immigration user fees 

of $159.1 million and $192.8 million, land border inspection fees of $1.5 million and $6.2 million, and 

immigration enforcement account of $.3 million and $1.1 million as of September 30, 2007 and 2006, 

respectively. Non-entity fund balance includes monies received in connection with antidumping and 

Financial Section 97 
Notes to Financial Statements


countervailing duty orders and findings to qualifying Injured Domestic Industries of $573.7 million and 

$566 million as of September 30, 2007 and 2006, respectively. 

The entity deposit fund balance represents amounts received as an advance that are not accompanied 

by an order. Once the order is received the deposit fund balance is decreased. Deposit funds represent 

amounts received as an advance that are not accompanied by an order and include non-entity collections. The September 30, 2006, deposit fund balance is significantly higher than the September 30, 

2007, balance due to deposits relating to Canadian softwood lumber imports. 

Status of Fund Balance with Treasury as of September 30, 2007 and 2006 consists of the following 

(in thousands): 

2007 Entity Non-Entity Totals 

Unobligated Balance 

Available $ 16,641 $1,123,689 $ 1,140,330 

Unavailable 1,624,298 — 1,624,298 

Obligated Balance not yet Disbursed 3,751,514 — 3,751,514 

Restricted Unobligated Funds 680,264 — 680,264 

Totals $6,072,717 $1,123,689 $ 7,196,406 

2006 Entity Non-Entity Totals 

Unobligated Balance 

Available $ 293,823 $5,944,570 $ 6,238,393 

Unavailable 749,160 — 749,160 

Obligated Balance not yet Disbursed 2,693,415 — 2,693,415 

Restricted Unobligated Funds 686,432 — 686,432 

Totals $4,422,830 $5,944,570 $10,367,400 

Amounts reported as Unobligated Balance Unavailable and Obligated Balance not yet Disbursed will 

not match amounts reported on the Combined Statement of Budgetary Resources due to CBP reporting all Non-entity Fund Balance with Treasury amounts as Unobligated Balance Available. Portions of 

the Unobligated Balance Available, Unobligated Balance Unavailable and Obligated Balance not yet 

Disbursed contains CBP’s user fees account balance of $680 and $640 million as of September 30, 

2007 and 2006, which is restricted by law in its use to offset specific costs incurred by CBP until 

made available as provided in Appropriation Acts. 

Portions of the Unobligated Balance Unavailable include amounts appropriated in prior fiscal years that 

are not available to fund new obligations. However, it can be used for upward and downward adjustments for existing obligations in future years. 

The Obligated Balance not yet Disbursed represents amounts designated for payment of goods or 

services ordered but not received or goods and services received but for which payment has not yet 

been made. 

98 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


CBP returned to Treasury $73 million and $83 million for indefinite no-year authority and $1.9 million 

in authority for obligations pursuant to public law during both the years ending September 30, 2007 

and 2006. 

In accordance with Public Law 101-510, CBP is required to automatically cancel obligated and unobligated balances of appropriated funds five years after a fund expires. Obligations that have not been 

paid at the time an appropriation is canceled may be paid from an unexpired appropriation that is 

available for the same general purpose. As of September 30, 2007, CBP canceled $29 million from 

FY 2002 annual appropriations, of which $23.8 million was deobligated. As of September 30, 2006, 

CBP canceled $20.2 million from FY 2001 annual appropriations, of which $14.4 million was deobligated. Based on historical activity CBP estimates obligations related to canceled appropriations that 

will be paid from future appropriations, would not exceed $1 million in any fiscal year. 

4. Cash and Other Monetary Instruments 

Cash and Other Monetary Instruments as of September 30, 2007 and 2006, consist of the following 

(in thousands): 

2007 Entity Non-Entity Totals 

Imprest Funds $ 147 $ — $ 147 

Undeposited Collections 1,827 4,957 6,784 

Monetary Instruments — 250 250 

Totals $1,974 $5,207 $7,181 

2006 Entity Non-Entity Totals 

Imprest Funds $ 118 $ — $ 118 

Undeposited Collections 226 4,945 5,171 

Monetary Instruments — 360 360 

Totals $ 344 $5,305 $5,649 

Undeposited collection balances represent timing differences between when cash relating to duties, 

taxes, fees, and other trade related collections are received and the deposit occurs in a future period. 

Cash can either be distributed to the General Fund, other federal agencies, other governments, or 

returned to the importer/broker. The monetary instruments represent instruments importers/brokers 

provide to CBP in lieu of obtaining surety bonds. 

Financial Section 99 
Notes to Financial Statements


5. Accounts Receivable, Net 

Intragovernmental Accounts Receivable 

Accounts receivable due from other federal agencies, as of September 30, 2007 and 2006, total 

$30.6 million and $48.2 million respectively, and are considered fully collectible. 

Receivables Due from Treasury—Refund and Drawback 

Non-entity Receivables Due from Treasury represent an estimate of duty, tax and/or fee refunds and 

drawbacks that will be reimbursed by a permanent and indefinite appropriation account and will be used 

to pay estimated duty refunds and drawbacks of $175.9 million and $412.4 million, as of September 30, 

2007 and 2006, respectively. 

Accounts Receivable with Public, Net 

As of September 30, 2007 and 2006 Accounts receivable with the public consists of reimbursable 

service receivables total $6 million and $3 million respectively, and are considered fully collectible; 

Customs user fee receivables total $76 million and $72 million, and are net of uncollectible amounts 

totaling $3 million and $2 million respectively; Immigration user fee receivables totals $69 million and 

$88 million, and are net of uncollectible amounts totaling $19 million and $13 million respectively. 

6. Tax, Duties and Trade Receivables, Net 

Receivables as of September 30, 2007 and 2006 are as follows (in thousands): 

2007 

Gross Amounts Total Net 

Receivable Category Receivable Uncollectible Receivables 

Duties $1,648,851 $ (115,903) $1,532,948 

Excise Taxes 126,752 (5,652) 121,100 

User fees 132,452 (5,164) 127,288 

Fines/penalties 1,115,645 (1,051,246) 64,399 

Interest 190,338 (175,458) 14,880 

Anti-Dumping/ 

Countervailing Duties 311,135 (235,041) 76,094 

Refunds and drawback 2,062 (1,897) 165 

Totals $3,527,235 $(1,590,361) $1,936,874 

100 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


2006 


Gross Amounts Total Net 

Receivable Category Receivable Uncollectible Receivables 

Duties $1,553,714 $ (117,932) $1,435,782 

Excise Taxes 99,178 (5,630) 93,548 

User fees 120,041 (12,864) 107,177 

Fines/penalties 1,120,769 (1,071,114) 49,655 

Interest 164,589 (156,361) 8,228 

Anti-Dumping/ 

Countervailing Duties 260,929 (200,777) 60,152 

Refunds and drawback 2,077 (1,997) 80 

Totals $3,321,297 $(1,566,675) $1,754,622 

CBP assesses duties, taxes and fees on goods and merchandise brought into the United States from 

foreign countries. At the time importers bring merchandise into the United States, they are required to 

file CBP entry documents. Generally, within 10 working days after CBP releases the merchandise into 

the U.S. commerce, the importer is to submit an entry document with payment of estimated duties, 

taxes and fees. In FY 2004, CBP began implementing periodic monthly payment that requires payment 

of estimated duties, taxes and fees on the 15th work day of the month following release. A receivable 

of $1.7 billion and $1.6 billion was recorded for 887,574 entries and 844,069 entries for merchandise 

released into commerce on or before September 30, 2007 and 2006, respectively, of which $967 million and $769 million related to importers using the periodic monthly payment. There were an additional 

4,829 entries and 4,541 entries for merchandise released into commerce on or before September 30, 

2007 and 2006, respectively, for which a receivable amount could not be determined because the entry 

summary documentation describing the type, quantity, and value of the merchandise had not been 

received from the importers. It is CBP policy to track and demand payment of unpaid estimated duties, 

taxes and fees receivable amounts by establishing a liquidated damage case which generally results in 

a fine and penalty type receivable. 

A fine or penalty is established when a violation of import/export law is discovered. CBP assesses a 

liquidated damage or penalty for these cases to the maximum extent of the law. After receiving the notice 

of assessment the importer or surety has 60 days to either file a petition requesting a review of the 

assessment or make payment of the assessed amount. If a petition is received and CBP finds there are 

extenuating circumstances, such as an incorrect assessment, which warrants mitigation, relief is granted 

as prescribed by CBP mitigation guidelines and directives. Until this process has been completed, CBP 

records an allowance on fines and penalties of approximately 94.75 percent of the total assessment 

based on historical experience of fines and penalties mitigation and collection. Duties and taxes receivable are non-entity assets for which there is an offsetting liability due to the Treasury General Fund. 

Financial Section 101 
Notes to Financial Statements


7. Inventory and Related Property, Net 

Operating Materials and Supplies 

Operating Materials and Supplies consist of parts and materials to repair and maintain CBP aircraft and 

vessels used in enforcement activities. CBP holds operating materials and supplies for future use only. 

CBP does not hold operating materials and supplies in reserve or excess. 

Operating Materials and Supplies as of September 30, 2007 and 2006 consist of the following (in 

thousands): 

Aircraft 

Vessels 

Totals 

2007 

$73,290 

3,527 

$76,817 

2006 

$63,350 

3,816 

$67,166 

8. Seized and Forfeited Property 

This schedule is presented for material prohibited (non-valued) seized and forfeited property only. 

These items are retained and ultimately destroyed by CBP and are not transferred to the Department of 

Treasury Forfeiture Fund or other federal agencies. The ending balance for firearms includes only those 

seized items that can actually be used as firearms. Illegal drugs are presented in kilograms and a portion 

of the weight includes packaging, which often cannot be reasonably separated from the weight of the 

drugs since the packaging must be maintained for evidentiary purposes. Steroids and ecstasy are added 

to the September 30, 2007 schedule. Firearms and pornography are presented in number of items. 

102 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


Analysis of Changes in Prohibited (Non-Valued) Seized Property, September 30, 2007 

Balance 

Unit of October 1 New New Adjustments Balance 

Category Measurement (1) Seizures Remissions Forfeitures (2) September 30 

Illegal Drugs 

Cannabis 

(marijuana) Kilograms 737 774,841 0 (772,729) 405 3,254 

Cocaine Kilograms 353 22,985 0 (23,075) (77) 186 

Heroin Kilograms 20 5,459 0 (5,463) 4 20 

Ecstasy Kilograms 0 1,426 0 (1,393) 0 33 

Steroids Kilograms 0 514 (65) (305) (8) 136 

Firearms Number 864 1,970 (886) (675) (143) 1,130 

Pornography Number 101 173 (3) (140) (55) 76 

(1) Beginning balances for ecstasy and steroids are not reported in this column since this is the first year for reporting these 

categories. The beginning balances for ecstasy and steriod are reported in the adjustments column. 

(2) Adjustments are caused by changes during the year to the beginning balances of cases. An example includes changes in 

the quantity from the amount reported in the beginning balance. Also, a prior year case can change legal status or property 

type. For example, a case considered forfeited could be re-opened and changed to seized status or a drug property type may 

change on a case. Beginning balances for ecstasy and steriods are reported in the adjustment column since FY 07 is the first 

year for reporting these categories. 

Analysis of Changes in Prohibited (Non-Valued) Seized Property, September 30, 2006 

Unit of Balance New New Adjustments Balance 

Category Measurement October 1 Seizures Remissions Forfeitures (1) September 30 

Illegal Drugs 

Cannabis 

(marijuana) Kilograms 502 439,748 0 (439,597) 84 737 

Cocaine Kilograms 162 28,513 0 (28,289) (33) 353 

Heroin Kilograms 26 1,345 0 (1,345) (6) 20 

Firearms and Explosives 

Firearms Number 2,021 1,362 (936) (1,521) (62) 864 

Pornography Number 141 158 0 (138) (60) 101 

(1) Adjustments are caused by changes during the fiscal year to cases on the beginning balance. For example, changes in 

quantity from the amount reported in the beginning balance. Additionally, prior year cases can change legal status or property 

type. For example, a case considered forfeited could be re-opened and changed to seized status, or a case can change a 

particular drug property type. 

Financial Section 103 
Notes to Financial Statements


Analysis of Changes in Prohibited (Non-Valued) Forfeited Property, September 30, 2007 

Balance 

Unit of October 1 New Adjustments Balance 

Category Measurement (1) Forfeitures Transfers Destroyed (2) September 30 

Illegal Drugs 

Cannabis 

(marijuana) Kilograms 97,304 772,729 (234,858) (459,151) (3,629) 172,395 

Cocaine Kilograms 19,584 23,075 (156) (20,545) (394) 21,564 

Heroin Kilograms 2,221 5,463 (4) (1,045) (43) 6,592 

Ecstasy Kilograms 0 1,393 (9) (1,060) 1,543 1,867 

Steroids Kilograms 0 305 0 (314) 22 13 

Firearms Number 253 675 (607) (2) 29 348 

Pornography Number 32 140 (1) (195) 53 29 

(1) Beginning balances for ecstasy and steroids are not reported in this column since this is the first year for reporting these 

categories. The beginning balances for ecstasy and steriod are reported in the adjustments column. 

(2) Adjustments are caused by changes during the year to the beginning balances of cases. An example includes changes in 

the quantity from the amount reported in the beginning balance. Also, a prior year case can change legal status or property 

type. For example, a case considered forfeited could be re-opened and changed to seized status or a drug property type may 

change on a case. Beginning balances for ecstasy and steriods are reported in the adjustment column since FY 07 is the first 

year for reporting these categories. 

Analysis of Changes in Prohibited (Non-Valued) Forfeited Property, September 30, 2006 

Unit of Balance New Adjustments Balance 

Category Measurement October 1 Forfeitures Transfers Destroyed (1) September 30 

Illegal Drugs 

Cannabis 

(marijuana) Kilograms 92,834 439,597 (3,167) (362,988) (68,972) 97,304 

Cocaine Kilograms 21,513 28,289 (7) (29,663) (548) 19,584 

Heroin Kilograms 2,104 1,345 (1) (1,242) 15 2,221 

Firearms and Explosives 

Firearms Number 276 1,521 (1,551) (4) 11 253 

Pornography Number 39 138 0 (178) 33 32 

(1) Adjustments are caused by changes during the fiscal year to cases on the beginning balance or transfer to another agency 

after forfeiture. The majority of adjustments to illegal drugs refers to forfeited cases where drugs were transferred to DEA. 

Prior year cases can change legal status or property type. For example, a case considered forfeited could be re-opened and 

changed to seized status, or a case can change a particular drug property type. 

104 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


9. General Property, Plant and Equipment, Net 

Property, Plant and Equipment as of September 30, 2007 and 2006 consist of the following 

(in thousands): 

2007 

Accumulated 

Useful Life Acquisition Depreciation/ Net 

Categories (in years) Cost Amortization Book Value 

Land and Land Rights N/A $ 41,493 $ — $ 41,493 

Improvements to Land 6–40 78,449 (35,397) 43,052 

Construction in Progress N/A 735,203 — 735,203 

Buildings, Other Structures 

and Facilities (a) 6–40 612,572 (109,968) 502,604 

Equipment: 

ADP Equipment 5 286,896 (167,347) 119,549 

Aircraft 12–20 825,749 (483,296) 342,453 

Vessels 5–30 22,484 (13,661) 8,823 

Vehicles 3–8 355,776 (282,165) 73,611 

Other Equipment 5–15 629,136 (372,560) 256,576 

Assets Under Capital Lease 2–10 10,157 (10,157) — 

Leasehold Improvements 2–30 189,563 (50,893) 138,670 

Internal Use Software 5 581,559 (440,634) 140,925 

Internal Use Software-in 

Development N/A 110,896 — 110,896 

Totals $4,479,933 $(1,966,078) $2,513,855 

Financial Section 105 
Notes to Financial Statements


2006 


Accumulated 

Useful Life Acquisition Depreciation/ Net 

Categories (in years) Cost Amortization Book Value 

Land and Land Rights N/A $ 27,690 $ — $ 27,690 

Improvements to Land 6–40 28,115 (17,268) 10,847 

Construction in Progress N/A 257,802 — 257,802 

Buildings, Other Structures 

and Facilities (a) 6–40 512,450 (95,519) 416,931 

Equipment: 

ADP Equipment 5 237,000 (127,939) 109,061 

Aircraft 12–20 749,566 (451,721) 297,845 

Vessels 5–30 22,392 (12,072) 10,320 

Vehicles 3–8 348,871 (268,022) 80,849 

Other Equipment 5–15 589,536 (289,395) 300,141 

Assets Under Capital Lease 2–10 10,279 (10,162) 117 

Leasehold Improvements 2–30 206,690 (62,736) 143,954 

Internal Use Software 5 575,045 (346,698) 228,347 

Internal Use Software-in 

Development N/A 40,987 — 40,987 

Totals $3,606,423 $(1,681,532) $1,924,891 

(a) Includes four multi-use heritage assets located in Puerto Rico with an acquisition value of $534 thousand. 

10. Stewardship PP&E 

As of September 30, 2007 and 2006, CBP maintains four multi-use heritage assets located in Puerto 

Rico valued at $534 thousand and are fully depreciated. Heritage assets are property, plant and equipment that have historical or national significance, cultural, educational or artistic importance, or significant architectural characteristics. Heritage assets are generally expected to be preserved indefinitely. 

All multi-use heritage assets are reflected on the Consolidated Balance Sheet. Additional information 

for heritage assets and general PP&E is presented in the required supplementary information. 

11. Advances and Prepayments 

Intragovernmental advances and prepayments as of September 30, 2007 and 2006, totaling $211.2 

and $174.5 million respectively, consist of advances to UNICOR for vehicle purchases. 

Advances and prepayments with the public as of September 30, 2007 and 2006, totaling $417 thousand and $605 thousand respectively, consist of employee travel and salary advances and prepaid rent. 

106 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


12. Liabilities Not Covered by Budgetary Resources 

Liabilities Not Covered by Budgetary Resources as of September 30, 2007 and 2006, consist of the 

following (in thousands): 

2007 2006 

Intragovernmental: 

Accrued FECA Liability $ 129,558 $ 118,226 

Total Intragovernmental 129,558 118,226 

Public: 

Accrued Payroll and Benefits: 

Accrued Leave 249,584 227,692 

Actuarial FECA Liability 618,969 556,745 

Other: 

Environmental Cleanup Costs 12,369 15,823 

Contingent Liability 38,463 14,804 

Software License Agreements 47,680 61,691 

Total Public 967,065 876,755 

Total Liabilities Not Covered by Budgetary Resources 1,096,623 994,981 

Total Liabilities Covered by Budgetary Resources or 

Non-Entity Assets 4,432,436 8,801,147 

Total Liabilities $5,529,059 $9,796,128 

Liabilities not covered by budgetary or other resources represent amounts owed in excess of available 

appropriated or other amounts. The liquidation of liabilities not covered by budgetary or other resources 

is dependent on future congressional appropriations. 

13. Accrued Payroll and Benefits 

The payroll and benefits liability as of September 30, 2007 and 2006 consists of the following 

(in thousands): 

2007 2006 

Accrued Funded Payroll and Benefits $ 163,004 $141,839 

Accrued Unfunded Leave 249,584 227,692 

Actuarial FECA Liability 

Total 

618,969 

$1,031,557 

556,745 

$926,276 

Actuarial workers compensation liability claims incurred for the benefit of CBP employees under FECA 

are administered by DOL and are ultimately paid by CBP. Future workers’ compensation estimates, 

generated from an application of actuarial procedures developed by the DOL. 

Financial Section 107 
Notes to Financial Statements


14. Environmental & Disposal Liabilities 

CBP is responsible to remediate its sites with environmental contamination. The major Federal laws covering environmental response, cleanup and monitoring are the Comprehensive Environmental Response, 

Compensation and Liability Act, the Resource Conservation and Recovery Act and the Toxic Substances 

Control Act. The unrecognized amounts of environmental liabilities for assets that require the systematic 

recognition of the total estimated cleanup costs is applicable to PP&E placed in service after October 1, 

1997. CBP’s environmental cleanup liability as of September 30, 2007 and 2006 was $12.4 million and 

$15.8 million, respectively. The liability consists of underground fuel storage tanks (UST), occupied buildings containing friable asbestos material and firing ranges. 

Cost estimates for environmental and disposal liabilities in this section are subject to material change 

as a result of changes in environmental laws and regulations, technology and plans. The nature of estimates and the disclosures herein are subject to possible changes due to inflation, deflation, technology 

or applicable laws and regulations and are disclosed as necessary based on the applicable asset. 

15. Other Liabilities 

CBP considers all Other Liabilities as current. 

Other Intragovernmental Liabilities consist of Employee Benefits and Taxes of $42 million and $35 million, and Advances from Others of $9 million and $7.9 million as of September 30, 2007 and 2006, 

respectively. 

Other Public Liabilities consist of the following: 

Refunds Payable 

Refunds Payable consists of amounts owed for refunds of duty and other trade related activity and drawback claims. These liabilities, all considered current year liabilities, are principally funded from the 

Refunds and Drawback account. 

CBP accrues a liability for refunds and drawback claims approved at year-end, but paid subsequent to 

year-end. Payments made to importers/exporters are primarily identified when the import entry is liquidated, a process in which CBP makes a final determination of duties, taxes and fees owed on the entry. 

Due to non-liquidation of the entries, the amount to be refunded is undetermined. Therefore, a historical 

calculated average was used to determine a ratio for estimating the receivable and payable to be 

recorded. Using this average, CBP has estimated $32.4 million and $9.8 million as of September 30, 

2007 and 2006, respectively, as a payable. 

The September 30, 2007 and 2006, accrued liability consists of the following (in thousands): 

2007 2006 

Refunds $ 91,167 $5,556,292 

Drawback claims 39,886 37,042 

Total $131,053 $5,593,334 

108 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


Injured Domestic Industries 

The Continued Dumping and Subsidy Offset Act of 2000, P.L. 106-387, Title X, enacted in FY 2001 calls 

for CBP to disburse monies received in connection with antidumping and countervailing (AD/CV) duty 

orders and findings to qualifying injured domestic industries. During FY 2007 and 2006, CBP liquidated 

$388.1 million and $475.8 million, respectively in AD/CV duty and recorded the liability. 

16. Leases 

Software License Agreements 

CBP has a software license fee agreement for a mainframe software license. The liability associated 

with this software license agreement is reflected on the accompanying Consolidated Balance Sheet 

based upon the present value of the future minimum license agreement payments. As of September 30, 

2007 and 2006, the aggregate capitalized cost of the agreement still subject to lease is $152.2 million. 

This agreement is included in the capitalized software. 

As of September 30, 2007 (in thousands:) 2007 

Summary of Assets Acquired through Acquisition Accumulated Net 

Capital Lease: Cost Depreciation Book Value 

Personal Property (software & equipment) $162,403 $(108,020) $54,383 

As of September 30, 2006 (in thousands:) 2006 

Summary of Assets Acquired through Acquisition Accumulated Net 

Capital Lease: 

Personal Property (machinery & equipment) 

Cost Depreciation Book Value 

$162,525 $ (92,584) $69,941 

Future minimum payments for cancelable commercial off-the-shelf license agreement and the 

present value of the minimum license agreement payments as of September 30, 2007, are as follows 

(in thousands): 

Fiscal Year 2007 

2008 $17,981 

2009 17,981 

2010 17,981 

2011 — 

2012 — 

Beyond 2012 — 

Total future minimum license 53,943 

Less: Imputed interest (6,263) 

Total net present value of software license agreements $47,680 

The net present value of the cancelable software license agreement is expected to be funded from 

future sources. 

Financial Section 109 
Notes to Financial Statements


Operating Leases 

CBP leases various facilities and equipment under leases accounted for as operating leases. The leased 

items consist of offices, warehouses, vehicles and other equipment. Much of the office space occupied 

by CBP is either owned by the Federal Government or is leased by the General Services Administration 

(GSA) from commercial sources. CBP is not committed to continue to pay rent to GSA beyond the period 

occupied providing proper advance notice to GSA unless the rental agreement is non-cancelable. It is 

expected that CBP will continue to occupy and lease office space from GSA in future years. 

The following schedule, by years, shows the future minimum rental payments required under operating 

leases that have initial orr emaining non-cancelable lease terms in excess of one year, as of September 

30, 2007. 

Fiscal Year Facilities 

2008 $ 3,432 

2009 3,450 

2010 3,478 

2011 3,506 

2012 3,410 

Beyond 2012 47,455 

Total future lease payments $64,731 

17. Commitments and Contingencies 

Legal Contingent Liabilities 

CBP is party to various administrative proceedings, legal actions, and claims brought by or against it. 


Any financially unfavorable administrative or court decision will normally be funded from either: (1) CBP 


appropriation for refunds and drawback for trade litigation issues; (2) various claims and judgment funds 


maintained by Treasury; or (3) CBP salary and expense appropriation. 


The range of estimated contingent liabilities for all probable and estimable litigation related claims as of 


September 30, 2007 was $83.5 million to $170.3 million. The estimated contingent liabilities for all 


probable and estimable litigation related to claims as of September 30, 2006 was $62.2 million. Of 


these amounts, $45 and $47.4 million as of September 30, 2007 and 2006, respectively, were funded 


from appropriations for the Refund and Drawback Account. Asserted and pending legal claims for which 


loss is reasonably possible range from an estimated at $34.5 million to $373.8 million as of September 


30, 2007. Asserted and pending legal claims for which loss was reasonably possible was $64 million, as 


of September 30, 2006. As of September 30, 2007 CBP has 5 cases considered reasonably possible 


for which no estimate could be made.


110 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


Duty and Trade Refunds 

There are various other trade issues resolved by other federal agencies, such as the Department of 

Commerce, which may result in refunds of duties, taxes and fees from the Refunds and Drawback 

Account. Until such time as a decision is reached by the other federal agencies, CBP does not have 

sufficient information to estimate a contingent liability amount. All known refunds as of September 30, 

2007 and 2006 have been recorded. 

Loaned Aircraft 

CBP is generally liable to the Department of Defense for damage or loss to aircraft on loan. CBP had 16 

aircraft loaned from Department of Defense with an acquisition value of $94.4 million, as of September 

30, 2007 and 2006. 

18. Earmarked Funds 

Consolidated Omnibus Budget Reconciliation (COBRA) 

In April 1986, the President signed the Consolidated Omnibus Budget Reconciliation Act (COBRA) of 

1985, which authorized the Customs and Border Protection (CBP) to collect user fees for certain services. The law initially established processing fees for air and sea passengers, commercial trucks, rail 

cars, private vessels and aircraft, commercial vessels, dutiable mail packages, and CBP broker permits. 

An additional fee category, contained in tax reform legislation, for processing barges and bulk carriers 

for Canada and Mexico, was added later that year. The collection of the COBRA fees for CBP services 

began on July 7, 1986. 

In addition to the collection of user fees, other changes in CBP procedures were enacted due to the 

COBRA statute. Most importantly, provisions were included for providing non-reimbursable inspectional 

overtime services and paying for excess pre-clearance costs from the COBRA user fee collections. 

The Customs and Trade Act of 1990 amended the COBRA legislation to provide for the hiring of inspectional personnel, the purchasing of equipment, and the covering of related expenses with any surplus 

monies available, after overtime and excess pre-clearance costs are satisfied. Expenditures from the 

surplus can only be used to enhance the service provided to those functions for which fees are collected. This legislation took effect on October 1, 1990. 

19 USC Section 58c contains the Fees for certain Customs services. The authority to use these funds 

is contained in the annual Department of Homeland Security Appropriations Act. 

Access to COBRA surplus funds provides CBP with additional resources to assist in the accomplishment 

of CBP’s mission. Increased staffing and equipment have enhanced the manager’s flexibility in dealing 

with the ever-increasing demands of the trade and travel communities. 

Financial Section 111 
Notes to Financial Statements


Immigration User Fees (IUF) 

Joint Resolution (H.J. Res. 738), making continuing appropriations for FY 1987 (the “1987 Act”) (Public 

Laws 99-500 and 99-591), established the Immigration User Fee Account (IUFA) [requiring] the [collection] of a $5.00 fee charged to each passenger arriving in the United States from foreign locations 

aboard commercial aircraft and commercial vessels except passengers whose journeys originated in the 

United States, Canada, Mexico, a territory or possession of the United States, or an adjacent island. The 

1987 Act directed the [INS] Service, beginning in FY 1987, to collect an immigration user fee for each 

passenger arriving in the United States by commercial air or sea conveyance (with limited exceptions). 

This law was codified in 8 U.S.C. 1103, 1356, section 286, the Immigration and Nationality Act (INA). 

In 1993, Congress amended section 286 of the INA by raising the immigration user fee from the original 

$5 to $6 with the passage of Public Law 103-121, making appropriations for the Departments of Commerce, Justice, and State, the Judiciary, and related agencies for the fiscal year ending September 30, 

1994, and for other purposes. 

In 1998, in Public Law 105-277, making appropriations for the Department of Transportation and 

related agencies for the fiscal year ending September 30, 1999, and for other purposes, Congress 

made a technical correction to section 286 by adding the word “State” to the list of exempt origination 

areas, making explicit what was already the policy. 

In 2002, in Public Law 107-77, making appropriations for the Department of Commerce, Justice, and 

State, the Judiciary, and related agencies for the fiscal year ending September 30, 2002, and for other 

purposes, the immigration user fee was increased from $6 to $7. 

Also in Public Law 107-77, Congress amended section 286(e) of the INA to authorize the Attorney 

General to charge and collect a user fee from certain previously exempt commercial vessel passengers. 

Prior to the enactment of this law, commercial vessel passengers whose journeys originated in Canada, 

Mexico, a State, territory or possession of the United States, or an adjacent island, were statutorily 

exempt from paying the Immigration User Fee prescribed by section 286(d) of the INA. While these 

vessel passengers were exempt from paying the fee, the [INS] Service was still required to provide 

inspection services. 

The IUFA was also established as a repository for fines imposed to prevent unauthorized landing and 

unlawful bringing of aliens in to the United States, penalties for document fraud, 31 Act overtime, and 

liquidated damages and expenses collected. All deposits into the IUFA are available until expended. 

The Department of Justice Appropriation Act of 1987 authorized legacy INS to collect user fees for 

processing commercial air and sea passengers. In FY 2003 with the formation of the DHS, legacy INS 

border functions transferred to CBP, while its interior enforcement activities fell to Immigration and 

Customs Enforcement (ICE). CBP collects and shares the revenue from the immigration user fees, 

appropriation 70X5087, based on a memorandum of understanding. CBP maintains approximately 83% 

of the user fee, while the other 17% is turned over to ICE. 

CBP records the entire user fee as non-exchange revenue (collections) on the Statement of Custodial 

Activities. 

112 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


The following tables present condensed data relating to CBP earmarked funds (disclosed in Note 1) as 

of and for the years ended September 30, 2007 and 2006 (in thousands): 

2007 

Balance Sheet as of September 30 COBRA IUF All Others Total 

Assets 

Fund Balance with Treasury $ 729,957 $ 159,119 $ 12,193 $ 901,269 

Tax, Duties and Trade Receivables, 

Net 68,452 — 28 68,480 

Other Assets 76,394 70,565 202 147,161 

Total Assets $ 874,803 $ 229,684 $ 12,423 $ 1,116,910 

Liabilities and Net Position for the 

Period Ended September 30 

Liabilities $ 87,086 $ 14 $ 2,334 $ 89,434 

Unexpended Appropriations — — — — 

Cumulative Results of Operations 787,717 229,670 10,089 1,027,476 

Total Liabilities and Net Position $ 874,803 $ 229,684 $ 12,423 $ 1,116,910 

Statement of Net Cost for the Period 

Ended September 30 

Gross Cost $ 369,300 $ 524,361 $ 45,521 $ 939,182 

Less Earned Revenue — — (1,936) (1,936) 

Net Cost of Operations $ 369,300 $ 524,361 $ 43,585 $ 937,246 

Statement of Change in Net Position 

for the Period Ended September 30 

Net Position Beginning of Period $ 798,750 $ 280,437 $ 15,455 $ 1,094,642 

Net Costs of Operations (369,300) (524,361) (43,585) (937,246) 

Taxes and Other Non Exchange 

Revenue 1,808,332 575,188 38,268 2,421,788 

Net Transfers In/Out (1,450,065) (101,594) (49) (1,551,708) 

Change in Net Position (11,033) (50,767) (5,366) (67,166) 

Net Position End of Period $ 787,717 $ 229,670 $ 10,089 $ 1,027,476 

Financial Section 113 
Notes to Financial Statements


2006


Balance Sheet COBRA IUF All Others Total 

Assets 

Fund Balance with Treasury $ 761,175 $ 192,814 $ 15,439 $ 969,428 

Tax, Duties and Trade Receivables, 

Net 61,117 — 110 61,227 

Other Assets 72,410 87,637 343 160,390 

Total Assets $ 894,702 $ 280,451 $ 15,892 $ 1,191,045 

Liabilities and Net Position 

Liabilities 95,952 14 437 96,403 

Unexpended Appropriations — — — — 

Cumulative Results of Operations 798,750 280,437 15,455 1,094,642 

Total Liabilities and Net Position $ 894,702 $ 280,451 $ 15,892 $ 1,191,045 

Statement of Net Cost 

Gross Cost $ 336,845 $ 480,011 $ 45,728 $ 862,584 

Less Earned Revenue — — (1,670) (1,670) 

Net Cost of Operations $ 336,845 $ 480,011 $ 44,058 $ 860,914 

Statement of Change in Net Position 

Net Position Beginning of Period $ 797,236 $ 239,091 $ 21,374 $ 1,057,701 

Net Costs of Operations (336,845) (480,011) (44,058) (860,914) 

Taxes and Other Non Exchange 

Revenue 1,704,342 624,884 38,090 2,367,316 

Net Transfers In/Out (1,365,983) (103,527) 49 (1,469,461) 

Change in Net Position 1,514 41,346 (5,919) 36,941 

Net Position End of Period $ 798,750 $ 280,437 $ 15,455 $ 1,094,642 

19. Intragovernmental Costs and Exchange Revenue 

Intragovernmental costs represent exchange transactions made between two reporting entities within 

the Federal Government and are presented separately from costs with the public (exchange transactions 

made between the reporting entity and a non-federal entity). Intragovernmental exchange revenue is disclosed separately from exchange revenue with the public. The criteria used for this classification requires 

that the intragovernmental expenses relate to the source of goods and services purchased by the reporting entity and not to the classification of related revenue. With “intragovernmental costs,” the buyer and 

114 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


seller are both federal entities. If a federal entity purchases goods or services from another federal entity 

and sells them to the public, the exchange revenue would be classified as “with the public,” but the 

related costs would be classified as “intragovernmental.” The purpose of this classification is to enable 

the Federal Government to provide consolidated financial statements, and not to match public and intragovernmental revenue with costs that are incurred to produce public and intragovernmental revenue. 

The Consolidated Statement of Net Cost reflects intragovernmental and public cost and exchange 

revenue as summarized below for the year ended September 30, 2007 and 2006 (in thousands): 

Border Security Inspections and Trade Facilitation at Ports of Entry 

Intragovernmental costs 

Public costs 

Total Border Security Inspections and Trade Facilitation at Ports 

of Entry Costs 

Intragovernmental earned revenue 

Public earned revenue 

Total Border Security Inspections and Trade Facilitation at Ports 

of Entry Revenue 

Border Security and Control Between Ports of Entry 

Intragovernmental costs 

Public costs 

Total Border Security and Control Between Ports of Entry Costs 

Intragovernmental earned revenue 

Public earned revenue 

Total Border Security and Control Between Ports of Entry 

Revenue 

Air and Marine Operations 

Intragovernmental costs 

Public costs 

Total Air and Marine Operations Costs 

Intragovernmental earned revenue 

Public earned revenue 

Total Air and Marine Operations Revenue 

Net Cost of Operations 

2007 2006 

$1,381,449 

3,758,826 

$1,252,679 

3,440,900 

5,140,275 4,693,579 

(135,051) 

(68,428) 

(127,161) 

(68,055) 

(203,479) (195,216) 

764,479

2,080,091 

2,844,570 

600,639 

1,649,857 

2,250,496 

(74,736) 

(37,868) 

(60,972) 

(32,631) 

(112,604) (93,603) 

99,236 

270,015 

369,251 

93,649 

257,238 

350,887 

(9,701) 

(4,916) 

(14,617) 

(9,506) 

(5,088) 

(14,594) 

$8,023,396 $6,991,549 

Financial Section 115 
Notes to Financial Statements


20. Sub-organization Program Costs/Program Costs by Segment 

CBP is the unified border agency whose priority mission is the prevention of terrorism and terrorist weapons from entering the U.S. Effective FY 2007, CBP in conjunction with DHS changed the allocation of net 

cost to align solely with prevention. CBP meets these responsibilities by: (1) enforcing the laws governing 

the flow of merchandise or commerce across the borders of the U.S.; (2) assessing and collecting duties, 

taxes and fees on imported and other goods and services; and (3) enforcing drug-related and other laws 

and regulations of the U.S. on behalf of federal agencies and/or in conjunction with various state, local 

agencies and foreign countries. 

Operating costs are summarized in the Consolidated Statement of Net Cost by responsibility segment, 

as applicable to the reporting period. The net cost of operations is the gross (i.e., total) cost incurred 

by CBP, less any exchange (i.e., earned) revenue. A responsibility segment is the component that 

carries out a mission or major line of activity, and whose managers report directly to Departmental 

Management. 

Schedule of Net Cost 

by Program and Prevention Service Combined Intra-Entity Consolidated 

Responsibility Segment Dollars Dollars Total Eliminations Total 

Border Security Inspections and Trade Facilitation at Ports of Entry (Note a) 

Gross Costs: 

Passenger Processing $3,012,224 $ — $3,012,224 $385,696 $2,626,528 

Trade Compliance 2,162,401 — 2,162,401 276,882 1,885,519 

Outbound 94,851 —- 94,851 12,145 82,706 

Anti-Terrorism 625,630 —- 625,630 80,108 545,522 

Total Gross Costs 5,895,106 — 5,895,106 754,831 5,140,275


Less: Earned Revenue 958,310 — 958,310 754,831 203,479


Net Program Costs $4,936,796 $ — $4,936,796 $ — $4,936,796 

Border Security and Control Between Ports of Entry (Note b) 

Gross Costs $3,262,284 $ — $3,262,284 $417,714 $2,844,570 

Less: Earned Revenue 530,318 — 530,318 417,714 112,604 

Net Program Costs $2,731,966 $ — $2,731,966 $ — $2,731,966 

Air and Marine Operations (Note c) 

Gross Costs $ 423,474 — $ 423,474 $ 54,223 $ 369,251 

Less: Earned Revenue 68,840 — 68,840 54,223 14,617 

Net Program Costs 354,634 — 354,634 — 354,634 

Net Cost of Operations $8,023,396 $ — $8,023,396 $ — $8,023,396 

2007 

For the year ended September 30, 2007 (in thousands): 

116 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


For the year ended September 30, 2006 (in thousands): 

2006 

Schedule of Net Cost 

by Program and Prevention Service Combined Intra-Entity Consolidated 

Responsibility Segment Dollars Dollars Total Eliminations Total 

Border Security Inspections and Trade Facilitation at Ports of Entry (Note a) 

Gross Costs: 

Passenger Processing $2,558,828 $ 21,799 $2,580,627 $335,237 $2,245,390 

Trade Compliance 1,595,494 498,854 2,094,348 272,067 1,822,281 

Outbound 96,417 — 96,417 12,525 83,892 

Anti-Terrorism 622,939 — 622,939 80,923 542,016 

Total Gross Costs 4,873,678 520,653 5,394,331 700,752 4,693,579 

Less: Earned Revenue 809,491 86,477 895,968 700,752 195,216 

Net Program Costs $4,064,187 $434,176 $4,498,363 $ — $4,498,363 

Border Security and Control Between Ports of Entry (Note b) 

Gross Costs 2,569,727 16,768 2,586,495 335,999 2,250,496 

Less: Earned Revenue 426,817 2,785 429,602 335,999 93,603 

Net Program Costs $2,142,910 $ 13,983 $2,156,893 $ — $2,156,893 

Air and Marine Operations (Note c) 

Gross Costs 403,275 — 403,275 52,388 350,887 

Less: Earned Revenue 66,982 —­ 66,982 52,388 14,594 

Net Program Costs 336,293 —­ 336,293 — 336,293 

Net Cost of Operations $6,543,390 $448,159 $6,991,549 $ — $6,991,549 

Notes to Schedule: 

Note a: Note b: 

Cost of processing passengers (Customs, Immigration, Enforcement 

Agriculture and land border) • Patrol 

• Compliance and Non-Compliance • Transportation 

• Non-Intrusive Technology Development and Implementation of the Secure Border 

• Contraband Enforce Team Initiative 

• Identify & Targeting Note c: 

• Antiterrorism Interdiction 

Air Traffic Security Cost General Investigative Activities 

Travel Facilitation • Intelligence 

Seaport Security Cost • Smuggling 

Trade Rules Compliance 

Financial Section 117 
Notes to Financial Statements


21. Non-Exchange Revenues and Transfers In/Out Without Reimbursement 

Non-exchange Revenue represents amounts collected from user fees that CBP may retain and expend as 

authorized by law. Transfers In/Out Without Reimbursement are amounts of funds collected and transferred from CBP receipt accounts to expenditure accounts within CBP and to other federal agencies. 

22. Apportionment Categories of Obligations Incurred: 

Direct vs. Reimbursable Obligations 

Apportionment categories are determined in accordance with the guidance provided in OMB Circular 

A-11, Preparation, Submission and Execution of the Budget. Category A represents resources apportioned 

for calendar quarters. Category B represents resources apportioned for other time periods; for activities, 

projects or objectives; or for any combination thereof (in thousands). 

Apportionment Apportionment Exempt from 

FY Ended September 30, 2007 Category A Category B Apportionment Total 

Obligations Incurred—Direct $6,008,329 $3,482,777 $1,543,665 $11,034,771 

Obligations Incurred— 

Reimbursable 1,384,488 102,195 — 1,486,683 

Total Obligations Incurred $7,392,817 $3,584,972 $1,543,665 $12,521,454 

Apportionment Apportionment Exempt from 

FY Ended September 30, 2006 Category A Category B Apportionment Total 

Obligations Incurred — Direct $5,284,687 $2,851,108 $ 896,577 $ 9,032,372 

Obligations Incurred — 

Reimbursable 

Total Obligations Incurred 

1,343,115 

$6,627,802 

(47,758) 

$2,803,350 

— 

$ 896,577 

1,295,357 

$10,327,729 

23. Appropriations 

As of September 30, 2007 and 2006, the Combined Statement of Budgetary Resources consist of 

appropriations totaling $11.2 and $9.2 billion, respectively. This differs from the Consolidated Statement of Changes in Net Position as of September 30, 2007 and 2006, which consist of appropriations 

received totaling $6.7 and $5.4 billion, respectively. This difference is due to CBP’s non-entity activity, 

which as of September 30, 2007 and 2006, consists of $2 and $1.4 billion, respectively, for Refund and 

Drawback activity as well as $2.5 and $2.4 billion, respectively, for user/inspection fees and subsidy 

activity which are not reported on the Consolidated Statement of Changes in Net Position. 

118 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


Permanent indefinite appropriations refer to the appropriations that result from permanent public laws, 

which authorize CBP to retain certain receipts. The amount appropriated depends upon the amount of 

the receipts rather than on a specific amount. CBP has a permanent and indefinite appropriation, which 

is used to disburse tax and duty refunds and duty drawbacks. Although funded through appropriations, 

refund and drawback activity is, in most instances, reported as a custodial activity. Refunds are custodial 

revenue-related activity in that refunds are a direct result of importer overpayments of their duties, taxes 

and fees. Federal tax revenue received from taxpayers is not available for use in the operation of CBP 

and is not reported on the Consolidated Statement of Net Cost. Likewise, the refunds of overpayments 

are not available for use by CBP in its operations. Refunds and drawback disbursements totaled $6.92 

billion and $1.16 billion for fiscal year ended September 30, 2007 and 2006, and are presented as a 

use of custodial revenue on the Consolidated Statement of Custodial Activity. The FY 2007 amount is 

higher than the FY 2006 amount due to the Canadian Softwood Lumber disbursements. This appropriation is not subject to budgetary ceilings established by Congress. CBP’s refund payable at year-end is 

not subject to funding restrictions. Refund payment funding is recognized as appropriations are used. 

24. Legal Arrangements Affecting the Use of Unobligated Balances 

Unobligated balances, whose period of availability has expired, are not available to fund new obligations. 

Expired unobligated balances are available to pay for current period adjustments to obligations incurred 

prior to expiration. For a fixed appropriation account, the balance can be carried forward for five fiscal 

years after the period of availability ends. For a no-year account, the unobligated balance is carried forward indefinitely until (1) specifically rescinded by law; or (2) the head of the agency concerned or the 

President determines that the purposes for which the appropriation was made have been carried out 

and disbursements have not been made against the appropriation for two consecutive years. 

Included in the cumulative results of operations for special funds is $1.1 billion at September 30, 2007, 

that represents CBP’s authority to assess and collect user fees relating to merchandise and passenger 

processing, to assess and collect fees associated with the services performed at certain small airports 

or other facilities, retain amounts needed to offset costs associated with collecting duties, and taxes 

and fees for the government of Puerto Rico. These special fund balances are restricted by law and in 

their use to offset specific costs incurred by CBP. Part of the passenger fees in the COBRA User Fee 

Account, totaling approximately $758 million, as of September 30, 2007 is restricted by law in its use to 

offset specific costs incurred by CBP and are available to the extent provided in Department Appropriations Acts. 

The entity trust fund balances result from CBP’s authority to use the proceeds from general order items 

sold at auction to offset specific costs incurred by CBP relating to their sale, to use available funds in 

the Salaries and Expense Trust Fund to offset specific costs for expanding border and port enforcement 

activities, and to use available funds from the Harbor Maintenance Trust Fund to offset administrative 

expenses related to the collection of the Harbor Maintenance Fee. 

Financial Section 119 
Notes to Financial Statements


25. Explanation of Differences Between the SBR and the Budget of the 

U.S. Government 

The table below documents the material differences between the FY 2006 Combined Statement of 

Budgetary Resources and the actual amounts reported for FY 2006 in the Budget of the United States 

Government. Since the FY 2007 financial statements are reported prior to the Budget of the United 

States Government, CBP is reporting for FY 2006 only. Typically, the Budget of the United States Government with the FY 2007 actual data is published in February of the subsequent year. Once published, 

the FY 2007 actual data will be available at OMB website, www.whitehouse.gov/omb. (In thousands.) 

Distributed 

Budgetary Obligations Offsetting 

2006 Resources Incurred Receipts Net Outlays 

Combined Statement of Budgetary 

Resources $12,623,272 $10,327,729 $2,347,944 $5,798,109 

Differences: 

Expired Appropriation not included in 

President’s Budget (173,907) (117,384) — — 

Refunds & Drawbacks not included in 

President’s Budget (891,009) (890,680) — (890,721) 

Injured Domestic Industries not included 

in President’s Budget (20X5688) (792,179) (226,052) — (226,052) 

Offsetting Receipts included in Treasury 

Annual Report but not in column C above — — 86,103 2,347,944 

Miscellaneous (1,000) 2,000 1,000 — 

Total Differences (1,858,095) (1,232,116) 87,103 1,231,171 

Budget of the U.S. Government $10,765,177 $ 9,095,613 $2,435,047 $7,029,280 

26. Undelivered Orders at the end of Period 

An undelivered order exists when a valid obligation has occurred and funds have been reserved, but the 

goods or services have not been delivered and have not prepaid. Undelivered orders for the period 

ended September 30, 2007 and 2006 (in thousands): 

2007 2006 

Unpaid $3,012,252 $2,522,099 

Upward/Down Adjustment of Prior Period (176,264) (166,830) 

Total Undelivered Orders at the end of Period $2,835,988 $2,355,269 

120 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


27. Custodial Revenues 

The Consolidated Statement of Custodial Activity has been prepared from CBP accounting records in 

conformity with generally accepted accounting principles (GAAP). Custodial Revenue consists of duties, 

user fees, fines and penalties, refunds and drawback overpayments and interest associated with import/ 

export activity which have been established as a specifically identifiable, legally enforceable claim and 

remain uncollected as of year-end. These receivables are net of amounts deemed uncollectible which 

were determined by considering the debtor’s payment record and willingness to pay, the probable recovery of amounts from secondary sources, such as sureties and an analysis of aged receivable activity. 

Primarily, revenue collections result from current fiscal year activity. 

Disbursements from the Refunds and Drawback account for the fiscal year ended Septemb

and 2006 (in thousands): 

2007 2006 

Refunds $6,296,311 $ 646,035 

Drawback 625,723 514,016 

Total $6,922,034 $1,160,051 

Amounts refunded during FY 2007 identified by entry year consist of the following (in thous

Entry Year 2007 

2007 $5,531,472 

2006 221,733 

2005 326,968 

2004 363,025 

Prior Years 478,836 

Total $6,922,034 

Entry Year 2006 

2006 $ 596,166 

2005 142,713 

2004 89,827 

2003 38,827 

Prior Years 

Total 

292,518 

$1,160,051 

er 30, 2007 

ands): 

Financial Section 121 
Notes to Financial Statements


The total amounts of antidumping and countervailing duties vary from year to year, depending on decisions from Department of Commerce. Antidumping and countervailing duty refunds (included in total 

refunds presented above) and associated interest refunded for the fiscal years ended September 30, 

2007 and 2006, consisted of the following (in thousands): 

2007 2006 

Antidumping and countervailing duty refunds $5,033,930 $381,406 

Interest 654,672 85,613 

Total $5,688,602 $467,019 

28. Reconciliation of Net Cost of Operations to Budget 

The following table presents CBP’s reconciliation of net cost of operations to budgetary accounts for the 

years ended September 30, 2007 and 2006: 

2007 2006 

Resources Used to Finance Activities: 

Budgetary Resources Obligated 

Obligations Incurred $12,521,454 $10,327,729 

Less: Spending Authority from Offsetting Collections and Recoveries 1,659,029 1,564,040 

Obligations Net of Offsetting Collections and Recoveries 10,862,425 8,763,689 

Less: Offsetting Receipts 2,360,600 2,347,944 

Net Obligations 8,501,825 6,415,745 

Other Resources 

Donations and Forfeiture of Property 3,618 6,497 

Transfers in/out Without Reimbursement 3,509 40,928 

Imputed Financing from Costs Absorbed by Others 305,758 251,074 

Net Other Resources Used to Finance Activities 312,885 298,499 

Total Resources Used to Finance Activities $ 8,814,710 $ 6,714,244 

(Continued) 

122 U.S. Customs and Border Protection • Performance and Accountability Report 
Notes to Financial Statements


2007 2006 

Resources Used to Finance Items Not Part of the Net Cost of 

Operations 

Change in Budgetary Resources Obligated for Goods, Services and 

Benefits Ordered, but not yet Provided 

Resources that Fund Expenses Recognized in Prior Periods 

Budgetary Offsetting Collections and Receipts that do not Affect 

Net Cost of Operations 

Other 

Resources that Finance the Acquisition of Assets or Liquidation of 

Liabilities 

Other Resources or Adjustments to Net Obligated Resources that 

do not Affect Net Cost of Operations 

$ 526,996 

1,503 

— 

(2,358,664) 

1,049,537 

2,028,173 

$ 577,971 

88,339 

— 

(2,346,273) 

504,401 

1,247,955 

Total Resources Used to Finance Items Not Part of the Net Cost 

of Operations $ 1,247,545 $ 72,393 

Total Resources Used to Finance the Net Cost of Operations $ 7,567,165 $ 6,641,851 

Components of the Net Cost of Operations that will not Require or 

Generate Resources in the Current Period: 

Components Requiring or Generating Resources in Future Periods 

Increase in Annual Leave Liability 

Other 

Total Components of Net Cost of Operations that will Require or 

Generate 

$ 21,892 

73,556 

$ 95,448 

$ 21,099 

31,514 

$ 52,613 

Components not Requiring or Generating Resources 

Depreciation and Amortization 

Revaluation of Assets or Liabilities 

Other 

Total Components of Net Cost of Operations that will not Require 

or Generate 

$ 344,639 

12,035 

4,109 

$ 360,783 

$ 319,630 

173 

(22,718) 

$ 297,085 

Total Components of Net Cost of Operations That Will Not Require 

or Generate Resources in the Current Period $ 456,231 $ 349,698 

Net Cost of Operations $ 8,023,396 $ 6,991,549 

Financial Section 123 
Required Supplementary Information


Customs and Border Protection 

Required Supplementary Information 

(Unaudited) 

Deferred Maintenance 

Deferred maintenance is maintenance that was not performed when it should have been or was scheduled to be performed, and has been delayed until a future period. Maintenance includes preventive maintenance, normal repairs, replacement of parts and structural components, and other activities needed to 

preserve the asset so that it will continue to provide acceptable service and achieve its useful life. 

An assessment of “fair” means the facility/equipment condition meets minimum standards but requires 

additional maintenance or repair to prevent further deterioration, increase operating efficiency and to 

achieve normal life expectancy. An assessment of “good” means the facility/equipment condition is 

above minimum standards, but requires preventative maintenance or normal repairs to maintain the 

design intent of the building or equipment so that it continues to provide acceptable service and 

achieves the expected useful life. Deferred maintenance on property, plant and equipment as measured 

by condition assessment survey, is comprised of (in thousands): 

2007 

Condition Deferred 

Assessment Maintenance 

Building and Structures Poor $4,395 

Vehicles — — 

Stewardship/Heritage Assets (multi-use) — — 

Totals $4,395 

2006 

Condition Deferred 

Assessment Maintenance 

Building and Structures Fair to Good $5,509 

Vehicles Fair to Good 1 

Stewardship/Heritage Assets (multi-use) Fair to Good 1,080 

Totals $6,590 

Statement of Budgetary Resources (SBR) 

The total Budgetary Resources of $15.4 billion for FY 2007 includes new budget authority, unobligated 

balances at the beginning of the year and transferred in/out, spending authority from offsetting collections, recoveries of prior year obligations and adjustments. 

124 U.S. Customs and Border Protection • Performance and Accountability Report 
Required Supplementary Information


Customs and Border Protection


Required Supplementary Information (continued)


(Unaudited)


Schedule of Budgetary Resources for September 30, 2007 and 2006 are summarized below: 

Schedule of Budgetary Resources by Major Fund Type 

As of September 30, 2007 (in thousands): 

Appropriated Trust Other 

Funds Funds Funds Totals 

Budgetary Resources 

Unobligated balances brought forward, 

October 1 $ 822,285 $ 255 $1,473,003 $ 2,295, 543 

Recoveries of Prior Year Obligations 189,493 1,631 7,381 198,505 

Budget Authority: 

Appropriations 6,733,265 4,222 4,452,920 11,190,407 

Spending Authority from Offsetting 

Collections: 

Earned 

Collected 1,495,566 10 18,479 1,514,055 

Change in Receivable from Federal 

Sources (33,527) (10) (423) (33,960) 

Change in Unfilled Customer Orders: 

Advance Received (2,401) — — (2,401) 

Without Advance from Federal Sources (19,990) — (206) (20,196) 

Anticipated for Rest of Year — — — — 

Expenditure Transfers from Trust Funds 3,026 — — 3,026 

Subtotal 8,175,939 4,222 4,470,770 12,650,931 

Non-Expenditure Transfers from Trust Funds 1,826,274 3,026 (1,455,396) 373,904 

Permanently Not Available 

Total Budgetary Resources 

(29,075) 

$10,984,916 

— 

$9,134 

(73,449) 

$4,422,309 

(102,524) 

$15,416,359 

(Continued) 

Financial Section 125 
Required Supplementary Information


Customs and Border Protection 

Required Supplementary Information (continued) 

(Unaudited) 

Appropriated Trust Other 

Funds Funds Funds Totals 

Status of Budgetary Resources 

Obligations Incurred: 

Direct $8,052,517 $8,721 $2,973,533 $11,034,771 

Reimbursable 1,466,900 — 19,783 1,486,683 

Total Obligations Incurred 9,519,417 8,721 2,993,316 12,521,454 

Unobligated Balance: 

Apportioned 14,930 242 1,469 16,641 

Exempt from Apportionment — — — — 

Subtotal 14,930 242 1,469 16,641 

Unobligated Balance Not Available 1,450,569 171 1,427,524 2,878,264 

Total Status of Budgetary Resources $10,984,916 $9,134 $4,422,309 $15,416,359 

Change in Obligated Balances 

Obligated Balance, Net 

Unpaid Obligations Brought Forward, 

October 1 $2,960,284 $8,406 $ 98,484 $ 3,067,174 

Less: Uncollected Customer Payments 

from Federal Sources, Brought Forward 

from October 1 (372,998) (97) (1,846) (374,941) 

Total Unpaid Obligated Balance, Net 2,587,286 8,309 96,638 2,692,233 

Obligations Incurred, Net 9,519,417 8,721 2,993,316 12,521,454 

Gross Outlays (8,342,015) (9,918) (3,002,468) (11,354,401) 

Obligated Balance Transferred, Net 

Actual Transfers, Unpaid Obligations 34,008 — — 34,008 

Recoveries of Prior Year Unpaid Obligations (189,493) (1,631) (7,381) (198,505) 

Change In Uncollected Customer Pymts 

from Federal Sources 53,517 10 629 54,156 

Obligated Balance, Net End Of Period 

Unpaid Obligations 3,982,781 4,998 81,949 4,069,728 

Less: Uncollected Customer Pymts from 

Federal Sources (319,481) (88) (1,216) (320,785) 

Total, Unpaid Obligated Balance, Net, End of 

Period 3,663,300 4,910 80,733 3,748,943 

Net Outlays 

Gross Outlays 8,342,015 9,918 3,002,468 11,354,401 

Less: Offsetting Collections (1,496,191) (10) (18,479) (1,514,680) 

Less: Distributed Offsetting Receipts — — (2,360,600) (2,360,600) 

Total Net Outlays $6,845,824 $9,908 $ 623,389 $ 7,479,121 

126 U.S. Customs and Border Protection • Performance and Accountability Report 
Required Supplementary Information


Customs and Border Protection 

Required Supplementary Information (continued) 

(Unaudited) 

Schedule of Budgetary Resources by Major Fund Type 

As of September 30, 2006 (in thousands): 

Appropriated Trust Other 

Funds Funds Funds Totals 

Budgetary Resources 

Unobligated balances brought forward, 

October 1 $ 514,175 $ 361 $1,209,708 $ 1,724,244 

Recoveries of Prior Year Obligations 201,280 896 15,026 217,202 

Budget Authority: 

Appropriations 5,440,771 5,894 3,807,136 9,253,801 

Spending Authority from Offsetting 

Collections: 

Earned 

Collected 1,273,412 — 17,114 1,290,526 

Change in Receivable From Federal 

Sources 22,788 10 (12,949) 9,849 

Change in Unfilled Customer Orders: 

Advance Received 1,400 — — 1,400 

Without Advance from Federal Sources 41,599 39 425 42,063 

Expenditure Transfers from Trust Funds 3,000 — — 3,000 

Subtotal 6,782,970 5,943 3,811,726 10,600,639 

Non-Expenditure Transfers from Trust Funds 1,612,177 3,000 (1,371,314) 243,863 

Permanently Not Available (79,685) — (82,991) (162,676) 

Total Budgetary Resources $9,030,917 $10,200 $3,582,155 $12,623,272 

Status of Budgetary Resources 

Obligations Incurred: 

Direct $6,929,278 $ 9,945 $2,093,149 $ 9,032,372 

Reimbursable 1,279,354 — 16,003 1,295,357 

Total Obligations Incurred 8,208,632 9,945 2,109,152 10,327,729 

Unobligated Balance: 

Apportioned 279,651 — 13,844 293,495 

Exempt from Apportionment — — 328 328 

Subtotal 279,651 — 14,172 293,823 

Unobligated Balance Not Available 542,634 255 1,458,831 2,001,720 

Total Status of Budgetary Resources $9,030,917 $10,200 $3,582,155 $12,623,272 

(Continued) 

Financial Section 127 
Required Supplementary Information


Customs and Border Protection


Required Supplementary Information (continued)


(Unaudited)


Appropriated Trust Other 

Funds 

Change in Obligated Balances 

Funds Funds Totals 

Obligated Balance, Net 

Unpaid Obligations Brought Forward, 

October 1 $2,294,870 $11,122 $ 91,634 $ 2,397,626 

Less: Uncollected Customer Payments from 

Federal Sources, Brought Forward from 

October 1 (308,612) (48) (14,369) (323,029) 

Total Unpaid Obligated Balance, Net 1,986,258 11,074 77,265 2,074,597 

Obligations Incurred, Net 8,208,632 9,945 2,109,152 10,327,729 

Gross Outlays (7,341,938) (11,765) (2,087,276) (9,440,979) 

Recoveries of Prior Year Unpaid Obligations (201,280) (896) (15,026) (217,202) 

Change In Uncollected Customer Pymts from 

Federal Sources (64,386) (49) 12,523 (51,912) 

Obligated Balance, Net End of Period 

Unpaid Obligations 2,960,284 8,406 98,484 3,067,174 

Less: Uncollected Customer Pymts from 

Federal Sources (372,998) (97) (1,846) (374,941) 

Total, Unpaid Obligated Balance, Net, End of 

Period 2,587,286 8,309 96,638 2,692,233 

Net Outlays 

Gross Outlays 7,341,938 11,765 2,087,276 9,440,979 

Less: Offsetting Collections (1,277,813) — (17,113) (1,294,926) 

Less: Distributed Offsetting Receipts — 

Total Net Outlays $6,064,125 

— (2,347,944) (2,347,944) 

$11,765 $ (277,781) $ 5,798,109 

128 U.S. Customs and Border Protection • Performance and Accountability Report 
Other Accompanying Information


Customs and Border Protection 

Other Accompanying Information 

(Unaudited) 

Custodial Activity 

Substantially all duty, tax and fee revenues collected by CBP are remitted to various General Fund 

accounts maintained by Treasury. Treasury further distributes these revenues to other federal 

agencies in accordance with various laws and regulations. CBP transfers the remaining revenue 

(less than one percent of revenues collected) directly to other federal agencies, the Governments of 

Puerto Rico and the U.S. Virgin Islands. Refunds of revenues collected from import/export activities 

are recorded in separate accounts established for this purpose and are funded through permanent 

indefinite appropriations. These activities reflect the non-entity, or custodial, responsibilities that CBP, 

as an agency of the Federal government, has been authorized by law to enforce. 

CBP reviews selected documents to ensure all duties, taxes and fees owed to the Federal government 

are paid and to ensure regulations are followed. If CBP believes duties, taxes, fees, fines or penalties are 

due in addition to estimated amounts previously paid by the importer/violator, the importer/violator is 

notified of the additional amount due. CBP regulations allow the importer/violator to file a protest on the 

additional amount due for review by the Port Director. A protest allows the importer/violator the opportunity to submit additional documentation supporting their claim of a lower amount due or to cancel the 

additional amount due in its entirety. Work in progress will continue until all protest options have expired 

or an agreement is reached. During this protest period, CBP does not have a legal right to importer/violator’s assets, and consequently CBP recognizes accounts receivable only when the protest period has 

expired or an agreement is reached. For FY 2007 and 2006, CBP had legal right to collect $1.94 and 

$1.75 billion of receivables. In addition, there was $2.7 and $2.4 billion representing records still in the 

protest phase for FY 2007 and 2006 respectively. CBP recognized as write-offs $184 and $204 million of 

assessments that the Department has statutory authority to collect at September 30, 2007 and 2006, 

but has no future collection potential. Most of this amount represents fines, penalties and interest. 

Revenue Gap 

The Compliance Measurement Program collects objective statistical data to determine the compliance 

level of commercial imports with U.S. trade laws, regulations and agreements, and it estimates the revenue gap. The revenue gap is a calculated estimate that measures potential loss of revenue owing to 

noncompliance with trade laws, regulations, and agreements using a statistically valid sample of the revenue losses and overpayments detected during Compliance Measurement entry summary reviews conducted throughout the year. For FY 2006 and 2005, the actual revenue gap was $450 and $470 million 

respectively. CBP calculated the preliminary FY 2007 and 2006 revenue gap to be $374 and $314 million respectively. The projected over-collection and under-collection amounts due to noncompliance for FY 

2007 were $61 million and $435 million, respectively. The projected over-collection and under-collection 

amounts due to noncompliance for FY 2006 were $128 million and $442 million, respectively. The preliminary overall trade compliance rate for FY 2007 and 2006 is 98.1 and 96.6 percent respectively. With 

overall compliance at a high level, CBP has been able to emphasize matters of significant trade risk. 

The final overall trade compliance rate and estimated revenue gap for FY 2007 will be issued in January 

2008. 

Financial Section 129 
Other Accompanying Information


Customs and Border Protection


Other Accompanying Information (continued)


(Unaudited)


Petitioned and Protested Schedule 

An analysis of the changes in petitioned and protested assessed amounts during FY 2007 and 2006 is 

as follows (in thousands): 

2007 

Protest Net Reduction 

Balance Additional in Favor Administrative Additional Balance 

Duties 

October 1 Assessments of Debtor Process Receivable September 30 

$ 62,743 $ 245,224 $ (7,449) $ (62,638) $ (17,270) $ 220,610 

Taxes 523 1,087 (31) (1,048) (483) 48 

Fees 374 4,637 (98) (1,019) (116) 3,778 

Fines/Penalties 1,970,379 1,614,214 (1,792,179) (92) 284,667 2,076,989 

Interest 99,252 124,867 (2,582) (44,662) (53,767) 123,108 

Antidumping/ 

Countervailing Duty 256,311 509,125 (15,920) (153,146) (294,240) 302,130 

Refunds & 

Drawback 

Totals 

10,687 22,537 (1,629) (20,140) (786) 10,669 

$2,400,269 2,521,691 $(1,819,888) $ (282,745) $ (81,995) $2,737,332 

2006


Protest Net Reduction 

Balance Additional in Favor Administrative Additional Balance 

Duties 

October 1 Assessments of Debtor Process Receivable September 30 

$ 60,190 $ 82,779 $ (8,776) $ (59,307) $ (12,143) $ 62,743 

Taxes 648 637 (19) (498) (245) 523 

Fees 346 1,871 (122) (1,620) (101) 374 

Fines/Penalties 1,461,138 1,648,233 (636,309) (59) (502,624) 1,970,379 

Interest 95,218 76,961 (15,772) (29,803) (27,352) 99,252 

Antidumping/ 

Countervailing Duty 228,300 235,230 (22,591) (60,110) (124,518) 256,311 

Refunds & 

Drawback 

Totals 

9,588 9,882 (1,040) (6,717) (1,026) 10,687 

$1,855,428 $2,055,593 $ (684,629) $ (158,114) $ (668,009) $2,400,269 

CBP reviews selected entry documentation to determine whether importer payment estimates of duties, 

taxes and fees were accurate or whether additional supplemental amounts are owed and should be 

billed. CBP regulations allow the importer 90 days (or 180 days for entries on or after 12/18/04) from 

the bill date in which to file a protest to be reviewed by the Port Director and an application requesting 

130 U.S. Customs and Border Protection • Performance and Accountability Report 
Other Accompanying Information


Customs and Border Protection


Other Accompanying Information (continued)


(Unaudited)


further review of the protest by CBP Office of Regulations and Rulings challenging the assessment of 

supplemental duties, taxes and fees. If the Port Director denies the protest and application for further 

review, the protestor has an additional 60 days from the denial date for a review of the application by the 

Commissioner of CBP. Consequently, CBP recognizes accounts receivables only when the protested 

period has elapsed or when a protest decision has been rendered in CBP favor. 

Additionally, importers and their sureties also have the option to petition for relief after receipt of CBP 

notice that a fine or penalty has been assessed when a violation of law or regulation is discovered. The 

importer or surety has 60 days to file a petition for relief or make payment of the assessed amount. If a 

petition is received and CBP finds there are extenuating circumstances such as an incorrect assessment, which warrants mitigation, relief is granted as prescribed by CBP mitigation guidelines and directives. Consequently, CBP recognizes accounts receivables only when the petition period has elapsed or 

when a petition decision has been rendered. 

Entity Receivables 

An aging of entity receivables as of September 30, 2007 and 2006 is as follows (in thousands): 

Aged Period 

2007 <=90 days 91 days–1 year 1–2 years 2–3 years 3+ years Total 

Reimbursable services $ 528 $ 4,265 $ 723 $ 696 $ 58 $ 6,270 

User fees 139,297 7,650 2,115 3,371 14,661 167,094 

Gross receivables 139,825 11,915 2,838 4,067 14,719 173,364 

Less uncollectible 

amounts (1,751) (1,326) (2,533) (3,179) (13,173) (21,962) 

Net receivables $138,074 $10,589 $ 305 $ 888 $ 1,546 $151,402 

2006 

Aged Period 

<=90 days 91 days–1 year 1–2 years 2–3 years 3+ years Total 

Reimbursable services $ 386 $ 447 $ 1,149 $ 710 $ 194 $ 2,886 

User fees 147,806 2,820 4,573 10,682 9,655 175,536 

Gross receivables 148,192 3,267 5,722 11,392 9,849 178,422 

Less uncollectible 

amounts 

Net receivables 

(442) 

$147,750 

(41) 

$ 3,226 

(3,295) 

$ 2,427 

(3,375) 

$ 8,017 

(8,562) 

$ 1,287 

(15,715) 

$162,707 

Financial Section 131 
Other Accompanying Information


Customs and Border Protection


Other Accompanying Information (continued)


(Unaudited)


Non-Entity Receivables 

An analysis of the changes in accounts receivable during FY 2007 and 2006 is as follows (in thousands): 

2007 

Receivables 

Recorded 

Receivable Balance During the Balance 

Category October 1 Fiscal Year Collections Write-offs Adjustments September 30 

Duties $ 1,553,714 $23,419,661 $(22,831,012) $ (2,349) $ (491,163) $ 1,648,851 

Excise Taxes 99,178 2,653,498 (2,669,793) (95) 43,964 126,752 

Fees 120,041 2,246,723 (2,235,523) (8) 1,219 132,452 

Fines/penalties 1,120,769 11,851,765 (60,139) (174,345) (11,622,405) 1,115,645 

Interest 164,589 139,307 (38,855) (2,013) (72,690) 190,338 

Antidumping/ 

Countervailing Duty 260,929 911,307 (532,320) (4,951) (323,830) 311,135 

Refunds/drawback 2,077 27,399 (25,301) (3) (2,110) 2,062 

Totals $3,321,297 $41,249,660 $(28,392,943) $(183,764) $(12,467,015) $ 3,527,235 

Less uncollectible 

amounts (1,566,675) (1,590,361) 

Net receivables $ 1,754,622 $ 1,936,874 

2006 

Receivables 

Recorded 

Receivable Balance During the Balance 

Category October 1 Fiscal Year Collections Write-offs Adjustments September 30 

Duties $ 1,142,830 $24,784,777 $(24,097,216) $ (1,065) $ (275,612) $ 1,553,714 

Excise Taxes 87,925 2,796,560 (2,788,384) (314) 3,391 99,178 

Fees 84,533 2,413,366 (2,357,234) (5) (20,619) 120,041 

Fines/penalties 1,033,688 1,932,068 (56,510) (189,253) (1,599,224) 1,120,769 

Interest 120,983 91,512 (34,289) (4,128) (9,489) 164,589 

Antidumping/ 

Countervailing Duty 240,494 1,465,289 (1,343,339) (8,910) (92,605) 260,929 

Refunds/drawback 1,609 22,935 (20,285) (18) (2,164) 2,077 

Totals $ 2,712,062 $33,506,507 $(30,697,257) $(203,693) $(1,996,322) $ 3,321,297 

Less uncollectible 

amounts (1,311,989) (1,566,675) 

Net receivables $ 1,400,073 $ 1,754,622 

132 U.S. Customs and Border Protection • Performance and Accountability Report 
Other Accompanying Information


Customs and Border Protection


Other Accompanying Information (continued)


(Unaudited)


An aging of non-entity Intragovernmental receivables as of September 30, 2007 and 2006 is as follows 

(in thousands): 

2007 

Aged Period 

<=90 days 91 days–1 year 1–2 years 2–3 years 3+ years Total 

Duties $1,527,733 $ 7,043 $ 13,996 $ 17,639 $ 82,440 $ 1,648,851 

Excise taxes 120,865 28 39 5 5,815 126,752 

User fees 117,524 82 14,578 23 245 132,452 

Fines/penalties 170,851 77,604 189,619 319,264 358,307 1,115,645 

Interest 1 1,854 30,516 4,968 152,999 190,338 

Antidumping/ 

Countervailing Duty 46,589 28,642 48,917 37,980 149,007 311,135 

Refunds and 

drawback 2 368 21 138 1,533 2,062 

Gross receivables 1,983,565 115,621 297,686 380,017 750,346 3,527,235 

Less uncollectible 

amounts 

Net receivables 

(167,657) 

$1,815,908 

(103,733) 

$ 11,888 

(256,898) 

$ 40,788 

(352,490) 

$ 27,527 

(709,583) 

$ 40,763 

(1,590,361) 

$ 1,936,874 

Aged Period 

2006 <=90 days 91 days–1 year 1–2 years 2–3 years 3+ years Total 

Duties $1,419,582 $ 22,674 $ 4,201 $ 15,619 $ 91,638 $ 1,553,714 

Excise taxes 93,117 67 5 5,691 298 99,178 

User fees 106,029 13,648 53 69 242 120,041 

Fines/penalties 106,411 189,664 369,503 238,469 216,722 1,120,769 

Interest 3 8,585 9,848 33,721 112,432 164,589 

Antidumping/ 

Countervailing Duty 46,864 20,175 34,652 94,342 64,896 260,929 

Refunds and 

drawback 2 185 161 1 1,728 2,077 

Gross receivables 1,772,008 254,998 418,423 387,912 487,956 3,321,297 

Less uncollectible 

amounts (106,940) (234,061) (398,410) (364,721) (462,543) (1,566,675) 

Net receivables $1,665,068 $ 20,937 $ 20,013 $ 23,191 $ 25,413 $ 1,754,622 

Financial Section 133 
Other Accompanying Information


Customs and Border Protection


Other Accompanying Information (continued)


(Unaudited)


CBP Collections by Category 

(Dollars in thousands) 

Duties 2003 2004 2005 2006 2007 

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 

Consumption entries $20,331,692 $21,012,275 $23,213,476 $24,787,051 $26,477,180 

Warehouse withdrawals 116,803 115,512 107,477 90,832 80,858 

Mail entries 3,961 3,175 2,687 2,696 4,015 

Passenger baggage entries 4,381 4,551 3,985 4,386 4,528 

Crew baggage entries 25 17 11 9 9 

Military baggage entries 6 4 2 2 1 

Informal entries 49,616 53,612 55,680 57,415 56,026 

Vessel repair entries 12,213 36,033 38,687 15,742 22,938 

Other duties 82,728 54,433 44,552 37,853 57,122 

Total Duties 20,601,425 21,279,612 23,466,557 24,995,986 26,702,677 

Miscellaneous 

Violations of CBP law 54,407 52,159 54,227 49,797 56,434 

Testing, inspecting & 

grading 62 54 56 46 34 

Miscellaneous taxes 41,186 17,391 18,659 19,803 19,726 

USDA collections 74,520 77,410 91,070 94,359 115,168 

Harbor maintenance fee 757,882 869,522 1,047,843 1,206,414 1,261,681 

Fees 4,258 5,195 5,419 7,107 6,695 

User fee account 1,322,756 1,464,138 1,600,365 1,702,043 2,436,087 

Unclaimed funds 897 1,081 1,124 991 479 

Recoveries 6 53 3 2 2 

Interest 12,711 9,892 9,760 8,604 13,229 

Other CBP receipts 5,199 8,663 9,645 17,246 17,382 

Total Miscellaneous 2,273,884 2,505,558 2,838,171 3,106,412 3,926,917 

Internal Revenue Taxes 2,092,276 2,205,744 2,255,482 2,345,992 2,537,098 

Total Collections $24,967,585 $25,990,914 $28,560,210 $30,448,390 $33,166,692 

These schedules will not equal amounts reported on the Consolidated Statement of Custodial Activity 

due to certain deposit fund collections being reported on the Consolidated Balance Sheet, timing 

differences between the collections report and general ledger postings, and other adjustments. 

134 U.S. Customs and Border Protection • Performance and Accountability Report 
Other Accompanying Information


Customs and Border Protection 

Other Accompanying Information (continued) 

(Unaudited) 

CBP Collections by Major Processing Port Locations 

(Dollars in thousands) 

2003 2004 2005 2006 2007 

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 

Boston $ 426,545 $ 440,158 $ 457,696 $ 478,550 $ 490,841 

Buffalo-Niagara Falls 166,428 181,876 201,428 210,888 211,699 

Ogdensburg 87,237 102,490 120,864 141,628 155,739 

Portland, Maine 49,879 54,311 59,397 57,673 59,000 

Providence 60,692 67,787 74,624 83,238 92,454 

St. Albans 34,473 41,129 47,311 44,687 42,897 

Baltimore 558,733 548,892 584,537 584,719 586,224 

Philadelphia 526,844 549,459 586,956 639,201 650,157 

Newark 3,851,645 3,961,215 4,179,939 4,362,201 4,552,031 

JFK Airport 1,291,671 1,274,989 1,300,376 1,220,472 1,234,035 

Charleston 807,133 906,318 1,145,999 1,175,442 1,030,435 

Miami 819,933 844,143 798,307 752,711 733,596 

San Juan 99,920 98,709 15,381 123,132 110,913 

St. Thomas 10,429 11,949 113,244 14,819 16,074 

Savannah 956,698 958,250 1,108,911 1,265,007 1,438,061 

Tampa 416,743 390,533 409,229 473,650 506,870 

Wilmington 263,549 272,646 267,769 290,312 314,993 

Norfolk 553,719 563,558 629,274 674,041 685,494 

NFC Indianapolis/ 

Washington 595,012 702,528 703,182 914,086 1,518,378 

Mobile 105,512 108,809 125,715 157,920 142,869 

New Orleans 847,966 855,041 885,110 936,744 1,055,211 

Dallas/Ft Worth 311,226 335,763 378,052 418,128 444,678 

El Paso 93,057 112,521 126,113 146,472 196,930 

Houston 518,039 497,180 611,527 773,047 805,245 

Laredo 301,332 307,842 337,921 370,216 395,215 

Port Arthur 32,161 32,613 35,092 28,144 32,604 

Nogales 97,051 92,216 82,636 77,832 82,999 

Los Angeles 5,589,441 5,982,568 6,788,238 7,258,249 8,138,181 

San Diego 226,881 230,158 237,419 259,000 303,717 

Anchorage 85,086 101,446 84,913 103,998 110,296 

Honolulu 41,255 45,898 42,089 39,670 39,955 

Financial Section 135 
Other Accompanying Information


Customs and Border Protection 

Other Accompanying Information (continued) 

(Unaudited) 

CBP Collections by Major Processing Port Locations (continued) 

2003 2004 2005 2006 2007 

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) 

Portland 336,487 341,904 369,471 395,707 454,523 

San Francisco 707,208 774,722 800,687 945,986 1,084,934 

Seattle 818,627 816,870 1,143,720 1,157,762 1,274,972 

Chicago 1,261,818 1,299,606 1,412,668 1,436,691 1,560,159 

Cleveland 1,001,462 1,009,197 1,114,677 1,245,447 1,385,583 

Detroit 433,890 487,286 552,711 546,870 538,879 

Milwaukee 36,656 32,437 32,630 33,230 36,056 

Minneapolis 119,441 123,082 132,869 168,568 180,724 

Pembina 12,990 14,256 16,434 17,631 18,982 

St. Louis 305,061 293,594 304,816 271,647 287,356 

Great Falls 107,655 124,965 140,278 152,974 166,733 

Total Revenues 

Collected $24,967,585 $25,990,914 $28,560,210 $30,448,390 $33,166,692 

136 U.S. Customs and Border Protection • Performance and Accountability Report 
Auditor Reports


Office of Inspector General (OIG) 


Report on Major Management Challenges


The DHS OIG’s Summary of Major Management Challenges Facing the Department of Homeland Security, 

dated November 2, 2007, and the agency’s progress addressing these challenges are addressed at the 

DHS consolidated level and are incorporated into the DHS Fiscal Year 2007 PAR. 

Independent Auditor’s Report 

The independent audit of CBP’s financial statements and internal controls was conducted by KPMG LLP, 

and follows in its entirety. 

Financial Section 137 
Independent Auditor’s Report


138 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 139 
Independent Auditor’s Report


Office

DEPARTMENT OF HOMELAND SECURITY 

of Inspector General 

U.S. Customs and Border Protectionʼs

FY 2007 Internal Controls 

OIG-08-15 November 2007 

140 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report


Financial Section 141 
Independent Auditor’s Report


142 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report


Financial Section 143 
Independent Auditor’s Report


144 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report


Financial Section 145 
Independent Auditor’s Report 

146 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 147 
Independent Auditor’s Report 

148 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 149 
Independent Auditor’s Report 

150 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 151 
Independent Auditor’s Report 

152 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 153 
Independent Auditor’s Report 

154 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 155 
Independent Auditor’s Report 

156 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report 

Financial Section 157 
Independent Auditor’s Report 

158 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report


Financial Section 159 
Independent Auditor’s Report


160 U.S. Customs and Border Protection • Performance and Accountability Report 
Independent Auditor’s Report


Financial Section 161 
Independent Auditor’s Report


Additional Information and Copies 

To obtain additional copies of this report, call the Office of Inspector General (OIG) at 

(202) 254-4199, fax your request to (202) 254-4305, or visit the OIG web site at 

www.dhs.gov/oig. 

OIG Hotline 

To report alleged fraud, waste, abuse or mismanagement, or any other kind of criminal 

or noncriminal misconduct relative to department programs or operations: 

x Call our Hotline at 1-800-323-8603;

x Fax the complaint directly to us at (202) 254-4292;

x Email us at DHSOIGHOTLINE@dhs.gov; or 

x Write to us at:

DHS Office of Inspector General/MAIL STOP 2600, Attention: 

Office of Investigations - Hotline, 245 Murray Drive, SW, Building 410,

Washington, DC 20528. 

The OIG seeks to protect the identity of each writer and caller. 

162 U.S. Customs and Border Protection • Performance and Accountability Report 
Management’s Response to the Independent Auditor’s Report


Financial Section 163 
Acronyms


A&M Air and Marine 

ACE Automated Commercial Environment 

ACS Automated Commercial System 

AD/CV Antidumping and countervailing 

ADP Automated Data Processing 

AMOR Air and Marine Operations Reporting 

System 

AMP Asset Management Plan 

APATS Air Program Administration Tracking 

System 

APIS Advance Passenger Information 

System 

ARO Admissibility Review Office 

ATS Automated Targeting System 

BICs Border Intelligence Centers 

BPETS Border Patrol Enforcement Tracking 

System 

BSETs Border Security Evaluation Teams 

BSI Border Safety Initiative 

BW Bonded Warehouses 

C3I Command, control, communications, 

and intelligence 

CAMITS Customs Automated Maintenance 

Inventory System 

CAR Checkpoint Activity Report 

CARMAC Computerized Aircraft Reporting and 

Material Control System 

CBP U.S. Customs and Border Protection 

CEP Canine Enforcement Program 

CFO Chief Financial Officer 

CM Compliance Measurement 

COBRA Consolidated Omnibus Budget 

Reconciliation 

CSI Container Security Initiative 

CSRS Civil Service Retirement System 

C-TPAT Customs Trade Partnership Against 

Terrorism 

CY Current Year 

DHS Department of Homeland Security 

DOE Department of Energy 

DOL Department of Labor 

DOS Department of State 

EEO Equal Employment Opportunity 

EITs Entry Identification Teams 

ENFORCE Enforcement Case Tracking 

ER Expedited Removal 

ESAR Entry Summary Accounts and 

Revenue 

FAIR Federal Activities Inventory Reform 

FAMs Federal Air Marshals 

FAST Free and Secure Trade 

FBI Federal Bureau of Investigation 

FDA Food and Drug Administration 

FDAU Fraudulent Document Analysis Unit 

FECA Federal Employees’ Compensation Act 

FERS Federal Employees’ Retirement 

System 

FFMIA Federal Financial Management 

Improvement Act 

FISMA Federal Information Security 

Management Act of 2002 

FMFIA Federal Managers’ Financial 

Integrity Act 

FRPP Federal Real Property Program 

FTE Full Time Equivalent 

164 U.S. Customs and Border Protection • Performance and Accountability Report 
Acronyms


FTZ Foreign Trade Zones 

FY Fiscal Year 

FYHSP Future Year Homeland Security 

Program 

GAAP Generally Accepted Accounting 

Principles 

GAO Government Accountability Office 

GOM The Government of Mexico 

GPRA Government Performance and 

Results Act 

GSA General Services Administration 

HECS Homeland Enforcement 

Communication System 

HRM Human Resources Management 

IA Internal Affairs 

IBET Integrated Border Enforcement Teams 

ICE Immigration and Customs 

Enforcement 

ICS International Container Scanning 

INA Office of International Affairs/ 

Immigration and Nationality Act 

INATR Office of International Affairs and 

Trade Relations 

INS Immigration and Naturalization 

Service 

IPIA Improper Payments Information Act 

of 2002 

IPT Integrated Product Team 

ITDS International Trade Data System 

IT Information Technology 

IUF Immigration User Fees 

IUFA Immigration User Fee Account 

MID Management Inspection Division 

MLUs Border Patrol Mexican Liaison Units 

NCIC National Crime Information Center 

NFR Notice of Finding and 

Recommendation 

NII Non-Intrusive Inspection 

NIST National Institute of Standards 

and Technology 

NLETS National Law Enforcement 

Telecommunication System 

NPRM Notice of Proposed Rule Making 

NTC National Targeting Center 

NTCC National Targeting Center-Cargo 

NTCP National Targeting Center-Passenger 

OASISS Operation Against Smugglers Initiative 

on Safety and Security 

OAT Office of Anti-Terrorism 

OBP Office of Border Patrol 

OCA Office of Congressional Affairs 

OCC Office of Chief Counsel 

OF Office of Finance 

OFO Office of Field Operations 

OIG Office of Inspector General 

OINT Office of Intelligence 

OIT Office of Information and Technology 

OJS Operation Jump Start 

OMB Office of Management and Budget 

OMR Operations Management Reports 

OPA Office of Public Affairs 

OPM Office of Personnel Management 

OPP Office of Policy and Planning 

ORBBP Operational Requirements Based 

Budget Program 

Acronyms 165 
Acronyms


OT Office of International Trade 

OTD Office of Training and Development 

OTM Other Than Mexican 

OTR Over-The-Road 

PAR Performance and Accountability 

Report 

PART Performance Assessment Rating Tool 

PF-70 Primary fence additional 70 miles 

PIERS Port Import Export Reporting Services 

PMA President’s Management Agenda 

POE Port of Entry 

POEs Ports of Entry 

PP&E Property, Plant and Equipment 

PY Prior Year 

RCMP Royal Canadian Mounted Police 

RPMC Real Property Management Council 

RFID Radio Frequency Identification 

RSI Required Supplementary Information 

SAFE Safety and Accountability for Every 

Port Act legislation 

SAP Systems, Applications, and Products 

SBI Secure Border Initiative 

SBI PEO Secure Border Initiative Program 

Executive Office 

SBR Statement of Budgetary Resources 

SENTRI Secure Electronic Network for Traveler 

Rapid Inspection 

SFFAS Statement of Federal Financial 

Accounting Standards 

SFI Secure Freight Initiative 

SIP Self-Inspection Program 

SIRS Self-Inspection Reporting System 

SNMP Simple Network Management Protocol 

TASPO Targeting and Analysis Systems 

Program Office 

TECS Treasury Enforcement Communication 

System 

TOI Targets of Interests 

TWP Temporary Worker Program 

TSA Transportation Security Agency 

UA Unmanned Aircraft 

UAS Unmanned Aircraft System 

U.S. United States 

USCG U.S. Coast Guard 

USDA U.S. Department of Agriculture 

UST Underground fuel storage tanks 

US-VISIT U.S. Visitor and Immigrant Status 

Indicator Technology 

VACIS Vehicle and Cargo Inspection Systems 

WADS Work Accomplishment Data System 

WCO World Customs Organization 

WHTI Western Hemisphere Travel Initiative 

WMD/Es Weapons of Mass Destruction/Effects 

166 U.S. Customs and Border Protection • Performance and Accountability Report 
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Overview of CBP


Additional Information and Copies 

To obtain additional copies of this report, 

visit the U.S. Customs and Border Protection 

public Website at http://www.cbp.gov 

U.S. Customs and Border Protection • Performance and Accountability Report