Fiscal Year 2013

SUMMARY OF PERFORMANCE AND

FINANCIAL INFORMATION
MISSION

License and regulate the Nation’s civilian use of byproduct, source, 

and special nuclear materials to ensure adequate protection 

of public health and safety, promote the common defense 

and security, and protect the environment.

PUBLIC PROTECTION NOTIFICATION

The NRC may not conduct or sponsor, and a person is not required to respond to, a request for information or an 

information collection requirement unless the requesting document displays a currently valid OMB control number.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ i

TABLE OF CONTENTS

A MESSAGE FROM THE CHAIRMAN. 

INTRODUCTION. 

ABOUT THE NRC  

THE NUCLEAR INDUSTRY  

PROGRAM PERFORMANCE OVERVIEW  

FUTURE CHALLENGES  .

INSPECTOR GENERAL’S ASSESSMENT OF THE MOST SERIOUS MANAGEMENT

AND PERFORMANCE CHALLENGES FACING NRC  .

A MESSAGE FROM THE CHIEF FINANCIAL OFFICER  .

FINANCIAL PERFORMANCE OVERVIEW  .

FINANCIAL STATEMENT HIGHLIGHTS  .

MANAGEMENT ASSURANCES, SYSTEMS CONTROLS, AND LEGAL COMPLIANCE  .

INSPECTOR GENERAL’S TRANSMITTAL LETTER  .

INDEPENDENT AUDITORS’ REPORT ON THE CONDENSED 

FINANCIAL STATEMENTS  .

CONDENSED FINANCIAL STATEMENTS  .

SUMMARY OF FINANCIAL STATEMENT AUDIT AND

MANAGEMENT ASSURANCES  .

AVAILABILITY OF REFERENCE MATERIALS IN NRC PUBLICATIONS  .

BIBLIOGRAPHIC DATA SHEET  .

This report is a summary of the U.S. Nuclear Regulatory Commission’s (NRC’s) Fiscal Year (FY) 2013 Performance and 

Accountability Report (PAR), published on December 16, 2013. This report is in an easy-to-read format and is available 

on the NRC Web site at http://www.nrc.gov. In addition, a video message from the Chairman and a full copy of the PAR 

are available on the DVD located on the back inside cover.
ii ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

The U.S. Nuclear Regulatory Commission (NRC) Headquarters

The U.S. Nuclear Regulatory Commission (NRC) Regions
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 1

A MESSAGE FROM THE CHAIRMAN

I am pleased to present the U.S. Nuclear Regulatory Commission’s (NRC’s) Summary 

of Performance and Financial Information for Fiscal Year (FY) 2013. This report 

highlights the NRC’s continuing success in achieving our mission to ensure the 

safe and secure use of radioactive materials for beneficial civilian purposes while 

protecting people and the environment. The report also provides key financial and 

performance information to Congress and the American people of how we used our 

resources during FY 2013. The report is available at http://www.nrc.gov/reading-rm/

doc-collections/nuregs/staff/sr1542/.

The NRC is an independent regulatory agency devoted to the effective and efficient 

oversight of the Nation’s 100 operating nuclear reactors, 31 research and test reactors, and the 4 reactors that 

entered the decommissioning phase in FY 2013. The agency also reviews all safety aspects of new reactor 

designs, environmental siting, combined license applications, and provides oversight for the 2 nuclear power 

plants currently under construction. Further, the agency focuses on the safe and secure use of nuclear materials 

in the energy, medical and industrial sectors through effective oversight of fuel facilities, uranium recovery sites, 

decommissioning sites, and nuclear material user licensees. In FY 2013, the NRC met all of its strategic goals and 

performance measure targets. 

The NRC developed 3 levels of recommendations following the 2011 Fukushima Dai-ichi accident in Japan. 

During FY 2013, the NRC monitored implementation of the highest priority new regulatory requirements for 

the Nation’s nuclear power plants. These requirements have also been integrated into the new reactor licensing 

process. The second level recommendations, needing more technical study, and the third level recommendations, 

needing more information to support regulatory action, are expected to be completed in the next few years.

The NRC is committed to good governance and the prudent management of resources entrusted to it by the 

American people. The agency will continue to evaluate, test, and strengthen its internal controls, including those 

related to financial reporting and financial management systems, as required by the Federal Managers’ Financial 

Integrity Act of 1982 (FMFIA). Based on the FMFIA assessments, I have concluded that there is reasonable 

assurance that the agency is in substantial compliance with FMFIA, and the financial and performance data 

published in this report are complete, accurate, reliable, and timely, in accordance with the Reports Consolidation 

Act of 2000 and Office of Management and Budget Circular A-136 requirements. Additionally, I have determined 

that the agency is in substantial compliance with the Federal Financial Management Improvement Act of 1996 

(FFMIA), based on the NRC’s application of the FFMIA risk model. 

I continue to be impressed by the performance and dedication of NRC employees in achieving the agency’s safety 

and security goals and look forward to continuing the high-quality service the American people have come to 

expect from us.

Allison M. Macfarlane

Chairman

March 10, 2014
2 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

INTRODUCTION 

The U.S. Nuclear Regulatory Commission (NRC) 

Summary of Performance and Financial Information 

presents an overview of the agency’s program 

performance and financial management performance 

during fiscal year (FY) 2013, which covers the period 

from October 1, 2012, to September 30, 2013. This 

summary report provides an opportunity for the 

American public to assess how effectively the NRC 

uses its funds to achieve results. 

When preparing this report, the NRC staff followed 

the guidance of the Office of Management and 

Budget (OMB) Circular A-136, “Financial Reporting 

Requirements.” The summarized financial statement 

data are based on the same underlying data as 

the financial statements presented in the FY 2013 

Performance and Accountability Report (PAR).

ABOUT THE NRC

The U.S. Congress established the NRC on 

January 19, 1975, as an independent Federal agency 

regulating the commercial and institutional uses of 

nuclear materials. The Atomic Energy Act of 1954, 

as amended, and the Energy Reorganization Act of 

1974, as amended, define the NRC’s purpose. These 

acts provide the foundation for the NRC’s mission to 

regulate the Nation’s civilian use of byproduct, source, 

and special nuclear materials to ensure adequate 

protection of public health and safety, to promote 

the common defense and security, and to protect the 

environment. The agency regulates civilian nuclear 

power plants and other nuclear facilities, as well as 

other uses of nuclear materials. These other uses 

include nuclear medicine programs at hospitals; 

academic activities at educational institutions; research 

work; industrial applications, such as gauges and 

testing equipment; and the transport, storage, and 

disposal of nuclear materials and wastes.

The NRC is headed by a Commission composed of 

five members, with one member designated by the 

President to serve as Chairman. With the advice and 

consent of the Senate, the President appoints each 

member to serve a 5-year term. The Chairman is the 

principal executive officer and official spokesperson 

for the Commission. The Executive Director for 

Operations carries out program policies and decisions 

made by the Commission.

The NRC’s Headquarters is located in Rockville, MD. 

The NRC has an Operations Center in the 

Headquarters building that coordinates 

communications with its licensees, State agencies, 

and other Federal agencies. This center is the focal 

point for assessing and responding to operating events 

in the industry. The NRC operations officers man the 

Operations Center 24 hours a day, seven days a week.

The agency also has four regional offices located 

in King of Prussia, PA; Atlanta, GA; Lisle, IL; and 

Arlington, TX. The regional offices allow the agency 

to work closely with its licensees to ensure safety. The 

NRC also employs at least two resident inspectors at 

each of the Nation’s nuclear power reactor sites. 

The NRC’s new budget authority for FY 2013 was 

$985.6 million, with 3,951 full-time equivalent staff. 

The NRC is primarily supported by fees collected from 

its licensees.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 3

THE NUCLEAR INDUSTRY

The NRC is responsible for regulating all aspects of 

the civilian nuclear industry. The industry can best 

be described by examining the nuclear material cycle. 

The nuclear material cycle begins with the mining and 

production of nuclear fuel or nuclear materials for 

medical, industrial, and other applications, continues 

with the use of nuclear fuel to power the Nation’s 

100 nuclear power plants, and ends with the safe 

transportation and storage of spent nuclear fuel and 

other nuclear waste. The NRC’s regulatory programs 

ensure that radioactive materials are used safely 

and securely at every stage in the nuclear material 

cycle. To address safety and security issues, the 

NRC has developed regulatory practices, knowledge, 

and expertise specific to each activity in the nuclear 

material cycle.

Fuel Facilities 

The production of nuclear fuel begins at uranium 

mines, where milled uranium ore is used to produce 

a uranium concentrate called “yellow cake.” At a 

special facility, the yellow cake is converted into 

uranium hexafluoride (UF6) gas and loaded into 

cylinders. The cylinders are sent to a gaseous diffusion 

plant, where uranium is enriched for use as reactor 

fuel. The enriched uranium is then converted into 

oxide powder, fabricated into fuel pellets (each about 

the size of a fingertip), loaded into metal fuel rods 

about 3.5 meters long, and bundled into reactor fuel 

assemblies at a fuel fabrication facility. Assemblies 

are then transported to nuclear power plants, nonpower research reactor facilities, and naval propulsion 

reactors for use as fuel. The NRC licenses eight major 

fuel fabrication and production facilities and three 

enrichment facilities in the United States. Because 

they handle extremely hazardous material, these 

facilities take special precautions to prevent theft, 

diversion by terrorists, and dangerous exposures to 

workers and the public from this nuclear material. 

Reactors 

Power plants change one form of energy into another. 

Electrical generating plants convert heat energy, the 

kinetic energy of wind or falling water, or solar energy 

into electricity. A nuclear power plant converts heat 

energy into electricity. Other types of heat-conversion 

plants burn coal, oil, or gas to produce heat energy 

that is then used to produce electricity. Nuclear 

energy cannot be seen. There is no burning of fuel 

in the usual sense. Rather, energy is given off by the 

nuclear fuel as certain types of atoms split in a process 

called nuclear fission. This energy is in the form of 

fast-moving particles and invisible radiation. As the 

particles and radiation move through the fuel and 

surrounding water, the energy is converted into heat. 

The radiation energy can be hazardous, and facilities 

take special precautions to protect people and the 

environment from these hazards.

Because the fission reaction produces potentially 

hazardous radioactive materials, nuclear power 

plants are equipped with safety systems to protect 

workers, the public, and the environment. Radioactive 

materials require careful use because they produce 

radiation, a form of energy that can damage human 

cells. Depending on the amount and duration of 

Figure 1

The Nuclear Fuel Cycle

Natural

Uranium

Heap

Leach

Milling

In Situ Mining

Uranium Recovery

Disposal

Reactor

Storage

Pool Dry Cask

Reprocessed Uranium

Depleted

Uranium

Fuel Fabrication Fresh

UO2

Fresh

MOX

Spent

UO2

Spent

MOX

Reprocessing

Facility

MOX

UO2

Enriched

Uranium Deconversion of

Depleted Uranium

Uranium-Plutonium

Mixture

Conversion

Enrichment
4 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

the exposure, radiation can potentially cause cancer. 

In a nuclear reactor, most hazardous radioactive 

substances, called fission byproducts, are trapped in 

the fuel pellets or in the sealed metal tubes holding 

the fuel. However, small amounts of these radioactive 

fission byproducts, principally gases, become mixed 

with the water passing through the reactor. Other 

impurities in the water also become radioactive as they 

pass through the reactor. The facility processes and 

filters the water to remove these radioactive 

impurities and then returns the water to the reactor 

cooling system.

Materials Users

The medical, academic, and industrial fields all use 

nuclear materials. For example, about one-third of 

all patients admitted to U.S. hospitals are diagnosed 

or treated using radioisotopes. Most major hospitals 

have specific departments dedicated to nuclear 

medicine. In all, about 112 million nuclear medicine 

or radiation therapy procedures are performed 

annually, with the vast majority used in diagnoses. 

Radioactive materials used as a diagnostic tool can 

identify the status of a disease and minimize the need 

for surgery. Radioisotopes give doctors the ability 

to look inside the body and observe soft tissues and 

organs, in a manner similar to the way X-rays provide 

images of bones. Radioisotopes carried in the blood 

also allow doctors to detect clogged arteries or check 

the functioning of the circulatory system. 

The same property that makes radiation hazardous 

can also make it useful in treating certain diseases like 

cancer. When living tissue is exposed to high levels of 

radiation, cells can be destroyed or damaged. Doctors 

can selectively expose cancerous cells (cells that are 

dividing uncontrollably) to radiation to either destroy 

or damage these cells.

Waste Disposal

During normal operations, a nuclear power plant 

generates both high-level radioactive waste, which 

consists of spent fuel, and low-level radioactive waste, 

which includes contaminated equipment, filters, 

maintenance materials, and resins used in purifying 

water for the reactor cooling system. Other users of 

radioactive materials also generate low-level waste.

Nuclear power plants handle each type of radioactive 

waste differently. They must use special procedures in 

the handling of the spent fuel because it contains the 

highly radioactive fission byproducts created while the 

reactor was operating. Typically, the spent fuel from 

nuclear power plants is stored in water-filled pools at 

each reactor site or at a storage facility in Illinois. The 

water in the spent fuel storage pool provides cooling 

and adequately shields and protects workers from 

the radiation. Several nuclear power plants have also 

begun using dry casks to store spent fuel. These heavy 

metal or concrete casks rest on concrete pads adjacent 

to the reactor facility. The thick layers of concrete and 

steel in these casks shield workers and the public from 

radiation. 

PROGRAM PERFORMANCE 

OVERVIEW

The NRC’s Strategic Plan describes the agency’s 

mission, goals, and strategies. The Strategic Plan can 

be found on the NRC’s Web site at www.nrc.gov/

reading-rm/doc-collections/nuregs/staff/sr1614/

v5/index.html. The agency’s two strategic goals are 

focused on Safety and Security. The Safety goal is to 

Ensure adequate protection of public health and safety 

and the environment. The Security goal is to Ensure 

adequate protection in the secure use and management 

of radioactive materials.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 5

n Prevent the occurrence of any releases of 

radioactive materials that cause significant adverse 

environmental impacts.

These strategic outcomes specify the conditions under 

which the Safety goal can be considered to have been 

met.

Safety Goal Strategies

The agency used the following safety strategies from 

its strategic plan to guide its activities and achieve its 

safety goal in FY 2013: 

1. Develop, maintain, implement, and improve 

licensing and regulatory programs for existing 

and new reactors, fuel cycle facilities, materials 

users, transportation and management of 

spent fuel, uranium recovery, waste disposal, 

and decommissioning activities to ensure the 

adequate protection of public health and safety. 

2. Oversee the safe and secure operation of existing 

facilities and uses of nuclear material. 

3. Oversee the construction of new power reactors.

4. Conduct NRC safety and security programs and 

emergency preparedness in an integrated manner.

5. Implement focused research programs to 

anticipate and support resolution of safety issues 

and address new technologies. 

6. Use sound science and state-of-the-art methods 

to establish, where appropriate, risk-informed and 

performance-based regulations.

7. Promote awareness of the importance of a strong 

safety culture and individual accountability of 

those engaged in regulated activities.

8. Use domestic and international operating 

experience to inform decision-making.

9. Oversee licensee safety performance through 

inspections, investigations, enforcement, and 

performance assessment activities.

10. Respond to events at NRC-licensed facilities and 

other events of national and international interest, 

Safety is the primary goal of the NRC. The agency 

achieves this goal by ensuring that the performance 

of licensees is at or above acceptable safety levels. 

NRC safety programs work in conjunction with its 

licensees in a partnership. The NRC licensees are 

responsible for designing, constructing, and operating 

nuclear facilities safely. The NRC is responsible for 

regulatory oversight of the licensees. The NRC safety 

goal activities are designed to achieve the following 

strategic outcomes.

Strategic Outcomes:

n Prevent the occurrence of any nuclear reactor 

accidents. 

n Prevent the occurrence of any inadvertent 

criticality events. 

n Prevent the occurrence of any acute radiation 

exposures resulting in fatalities. 

n Prevent the occurrence of any releases of 

radioactive materials that result in significant 

radiation exposures. 

ACTIVITIES

Fuel Facilities

Nuclear Materials Users

Decommissioning and

Low-Level Waste

Spent Fuel Storage and

Transportation

New Reactors

Operating Reactors

MAJOR PROGRAMS

Nuclear Reactor Safety Nuclear Materials and

Waste Safety

Safety Security

STRATEGIC GOALS

STRATEGIC GOAL 1: SAFETY

Ensure Adequate Protection of Public

Health and Safety and the Environment
6 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

including maintaining and enhancing the NRC’s 

emergency incident response and communication 

capabilities.

11. Respond to future national policy decisions 

regarding high-level nuclear waste and 

spent nuclear fuel management strategies 

recommended or adopted as the Nation’s policy, 

and assess issues associated with long-term 

storage of spent fuel and high-level waste.

FY 2013 Results

In FY 2013, the NRC achieved all five of its safety 

goal strategic outcomes. The NRC also uses six 

performance measures to determine whether it 

has met its Safety goal. The agency met all six 

performance measure targets in FY 2013 (see Table 1).

The first three performance measures focus on 

performance at individual nuclear power plants. 

Inspection results show that all of the nuclear power 

plants are operating safely. The fourth measure tracks 

the trends of several key indicators of nuclear power 

plant safety. This measure is the broadest measure 

of the safety of nuclear power plants, incorporating 

the performance results from all plants to determine 

industry average results. This measure shows that 

there were no statistically significant adverse trends in 

any of the indicators in FY 2013.

The last two safety performance measures track 

harmful radiation exposures to the public and 

occupational workers, and radiation releases that 

harm the environment. Neither of these two 

measures exceeded their targets in FY 2013.

The cost of achieving the agency’s Safety goal in 

FY 2013 was $995.1 million.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 7

Table 1

FY 2013 Safety Goal Performance Measures

1. Number of new conditions evaluated as red by the NRC’s Reactor Oversight Process.1

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target ≤ 3 ≤ 3 ≤ 3 ≤ 3 ≤ 3 ≤ 3

Actual 0 0 0 1 1 0

1 This measure is the number of new red inspection findings during the fiscal year plus the number of new red 

performance indicators during the fiscal year.  Programmatic issues at multiunit sites that result in red findings 

for each individual unit are considered separate conditions for purposes of reporting for this measure.  A red 

performance indicator and a red inspection finding that are due to an issue with the same underlying causes are also 

considered separate conditions for purposes of reporting for this measure.  Red inspection findings are included in 

the fiscal year in which the final significance determination was made.  Red performance indicators are included in 

the fiscal year in which Reactor Oversight Process (ROP) external Web page was updated to show the red indicator.

2. Number of significant Accident Sequence Precursors 2 (ASPs) of a nuclear reactor accident.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0

2

Significant Accident Sequence Precursor (ASP) events have a conditional core damage probability (CCDP) or ΔCDP 

of > 1x 10-3.  Such events have a 1/1000 (10-3) or greater probability of leading to a reactor accident involving core 

damage.  An identical condition affecting more than one plant is counted as a single ASP event if a single accident 

initiator would have resulted in a single reactor accident.

3. Number of operating reactors with integrated performance that entered the multiple/repetitive degraded 

cornerstone column or the unacceptable performance column of the Reactor Oversight Process Action 

Matrix, or the Inspection Manual Chapter 0350 process is ≤ 3 with no performance leading to the initiation 

of an Accident Review Group.3

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target ≤ 4 ≤ 3 ≤ 3 ≤ 3 ≤ 3 ≤ 3

Actual 0 0 0 2 1 0

3

 This measure is the number of plants that have entered the Inspection Manual Chapter (IMC) 0350 process, the 

multiple/repetitive degraded cornerstone column, or the unacceptable performance column during the fiscal year 

(i.e., were not in these columns or process the previous fiscal year).  Data for this measure are obtained from the 

NRC’s external Web Action Matrix Summary page, which provides a matrix of the five columns with the plants 

listed within their applicable column and notes the plants in the IMC 0350 process.  For reporting purposes, plants 

that are the subject of an approved deviation from the Action Matrix are included in the column or process in which 

they appear on the Web page.  The target value is set based on the expected addition of several indicators and a 

change in the long-term trending methodology (which will no longer be influenced by the earlier data and will be 

more sensitive to changes in current performance).
8 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Table 1

FY 2013 Safety Goal Performance Measures (continued)

4. Number of significant adverse trends in industry safety performance is ≤14.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target ≤ 1 ≤ 1 ≤ 1 ≤ 1 ≤ 1 ≤ 1

Actual 0 0 0 0 0 0

4 Considering all indicators qualified for use in reporting.

5. Number of events with radiation exposures to the public or occupational workers that exceed Abnormal 

Occurrence Criterion I.A.3.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Reactors Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0

Materials Target ≤ 2 ≤ 2 ≤ 2 ≤ 2 ≤ 2 ≤ 2

Actual 0 0 0 0 0 0

Waste Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0

6. Number of radiological releases to the environment that exceed applicable regulatory limits.5

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Reactors Target6 0 0 0 0 0 0

Actual 0 0 0 0 0 0

Materials Target ≤ 2 ≤ 2 ≤ 2 ≤ 2 ≤ 2 ≤ 2

Actual 0 0 0 0 0 0

Waste Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0

5

Releases for which a 30-day report under Title 10 of the Code of Federal Regulations (10 CFR) 20.2203(a)(3) is 

required. 

6

With no event exceeding Abnormal Occurrence Criterion I.B.  
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 9

Fukushima Regulatory 

Review

The NRC’s efforts to implement the lessons learned 

from the Fukushima Dai-ichi accident in March 2011 

continued during FY 2013. Nuclear power plants 

in the United States have made great progress in 

implementing the near-term actions to address natural 

disasters that may challenge the design bases of these 

plants. The agency oversaw implementation of new 

requirements to address hazards such as earthquakes 

and flooding. The NRC has also been using the 

insights from Fukushima to inform its licensing and 

oversight activities. The agency has been conducting 

technical studies and regulatory analyses to ensure the 

safe operation of existing reactors and to be applied 

to new reactors. A more complete discussion of the 

review and the subsequent actions taken by the NRC 

can be found in Chapter 2, Nuclear Safety section of 

the NRC FY 2013 Performance and Accountability 

Report.

Additional information can be found on the agency’s 

Web site at http://www.nrc.gov/reactors/operating/

ops-experience/japan-info.html.

The NRC must remain vigilant in ensuring the 

security of nuclear facilities and materials in an 

elevated threat environment. The agency achieves its 

common defense and Security goal using licensing 

and oversight programs similar to those employed in 

achieving its Safety goal.

Strategic Outcomes:

n Prevent instances where licensed radioactive 

materials are used domestically in a manner hostile 

to the security of the United States. 

STRATEGIC GOAL 2: SECURITY

Ensure Adequate Protection in the Secure

Use and Management of Radioactive Materials

n Prevent unauthorized public disclosures of 

classified or Safeguards Information through 

quality measures.

These strategic outcomes specify the conditions under 

which the Security goal can be considered to have been 

met. 

Security Goal Strategies

The agency used the following security strategies from 

its Strategic Plan to guide its activities and achieve its 

Security goal in FY 2013:

1. Conduct oversight of licensee security 

performance.

2. Use relevant intelligence information and security 

assessments to maintain realistic and effective 

security requirements and mitigation measures.

3. Share security information with appropriate 

stakeholders and international partners.

4. Control the handling and storage of sensitive 

security information and the communication of 

information to licensees and Federal, State, local 

and Tribal governments.

5. Support Federal response plans that employ an 

approach to the security of nuclear facilities and 

radioactive material that integrates the efforts 

of licensees and Federal, State, local, and Tribal 

governments.

6. Use risk-informed approaches to inform 

regulatory controls for security.

7. Maintain the programs for controlling the 

security of radioactive sources and strategic 

special nuclear material commensurate with their 

risk, including actions required by the Energy 

Policy Act of 2005.

8. Promote U.S. national security interests and 

nuclear nonproliferation policy objectives for 

NRC-licensed imports and exports of byproduct 

source and special nuclear materials and nuclear 

equipment.
10 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

9. Manage the risk to information and systems to 

ensure the integrity of cyber security at regulated 

facilities.

10. Prevent instances of significant unauthorized 

public disclosures of classified or Safeguards 

Information.

FY 2013 Results

In FY 2013, the NRC achieved its Security goal 

strategic outcomes. The NRC also uses five Security 

goal performance measures to determine whether 

the agency has met its Security goal. The agency met 

all five performance measure targets in FY 2013 (see 

Table 2). 

The first performance measure tracks unrecovered 

losses or thefts of risk-significant radioactive sources. 

The measure ensures that those radioactive sources 

that the agency has determined to be risk-significant 

to the public health and safety are accounted for at 

all times. The ability to account for these sources is 

critical to secure the nation from “dirty bomb” attacks 

or other means of radiation dispersal.

The second, third, and fourth performance measures 

evaluate the number of significant security events 

and incidents that occur at NRC-licensed facilities. 

These measures determine whether nuclear facilities 

maintain adequate protective forces to prevent theft 

or diversion of nuclear material or sabotage; whether 

systems in place at licensee plants accurately account 

for the type and amount of materials processed, 

used, or stored; and whether the facilities account for 

special nuclear material at all times with no losses 

of this material. There were no events that met the 

conditions for these measures in FY 2013.

The last security measure tracks significant 

unauthorized disclosures of classified and/or 

Safeguards Information that may cause damage to 

national security or public safety. This measure 

focuses on whether classified information or 

Safeguards Information is stored and used in such a 

way as to prevent its disclosure to the public, terrorist 

organizations, other nations, or personnel without a 

need to know. Unauthorized disclosures can harm 

national security or compromise public health and 

safety. The measure also focuses on whether controls 

are in place to maintain and secure the various devices 

and systems (electronic or paper-based) that the 

agency and its licensees use to store, transmit, and 

use this information. There were no documented 

disclosures of this type of information during FY 2013.

The cost of achieving the agency’s Security goal was 

$68.0 million in FY 2013.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 11

Table 2

FY 2013 Security Goal Performance Measures

1. Unrecovered losses of risk-significant1 radioactive sources.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target 0 0 0 0 0 0

Actual 0 0 0 12 0 0

1

 “Risk-significant” is defined as any unrecovered lost or abandoned sources that exceed the values listed in Appendix 

P to 10 CFR 110 – Category 1 and 2 Radioactive Material.  Excluded from reporting under this criterion are those 

events involving sources that are lost or abandoned under the following conditions: (1) sources abandoned in 

accordance with the requirements of 10 CFR 39.77(c); (2) recovered sources with sufficient indication that doses 

in excess of the reporting thresholds specified in Abnormal Occurrence (AO) Criteria I.A.1 and I.A.2 did not occur 

during the time the source was missing; (3) unrecoverable sources lost under such conditions that doses in excess 

of the reporting thresholds specified in AO Criteria I.A.1 and I.A.2 were not known to have occurred; (4) other 

sources that are lost or abandoned and declared unrecoverable; (5) for which the agency has made a determination 

that the risk-significance of the source is low based upon the locations (e.g., water depth) or physical characteristics 

(e.g., half-life, housing) of the source and its surroundings; (6) where all reasonable efforts have been made to recover 

the source; and (7) it has been determined that the source is not recoverable and will not be considered a realistic 

safety or security risk under this measure. (This includes licenses under the Agreement States.) 

2

 There were no losses and one theft of radioactive nuclear material that the NRC considered to be risk-significant 

during FY 2011. 

2. Number of substantiated3 cases of actual theft or diversion of licensed, risk-significant radioactive sources or 

formula quantities4 of special nuclear material or attacks that result in radiological sabotage5

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0

3

 “Substantiated” means a situation where an indication of loss, theft, or unlawful diversion cannot be refuted 

following an investigation and requires further action on the part of the agency or other proper authorities.  

4

 A “formula quantity” of special nuclear material is defined in 10 CFR 70.4, “Definitions.”

5

 “Radiological sabotage” is defined in 10 CFR 73.2, also titled “Definitions.” 

3. Number of substantiated losses of formula quantities of special nuclear material or substantiated inventory 

discrepancies of formula quantities of special nuclear material that are judged to be caused by theft or 

diversion or by substantial breakdown of the Accountability System.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0
12 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

FUTURE CHALLENGES

The nuclear industry has maintained an excellent 

safety record at nuclear power plants over the past two 

decades as both the nuclear industry and the NRC 

have gained substantial experience in the operation 

and maintenance of nuclear power facilities. However, 

despite the excellent safety record of the industry, 

the agency cannot rest on its achievements. The key 

challenges that the agency faces as the regulator of 

nuclear materials are to ensure that the new generation 

of nuclear power plants are built and operated safely 

and to safely dispose of nuclear waste.

Oversight of an Aging Fleet 

of Operating Reactors

Nuclear reactors in the United States have been 

operating longer than most other reactors in the 

world. The NRC faces the difficult task of ensuring 

that the plant structures, systems, and components at 

nuclear power plants are adequate for safe operation. 

Managing the aging of structures, equipment, and 

materials is a dynamic process that the licensees 

will have to diligently address and that will require 

monitoring by the agency’s licensing, oversight, and 

research staff. The NRC will also need to focus on the 

decommissioning of five nuclear reactors that will be 

discontinuing operation, one of which continues to 

operate but will cease operations in the near future.

Licensing a New Generation 

of Nuclear Power Plants

Currently, the agency has nine active Combined 

License (COL) applications for sites across the 

country. The NRC is overseeing construction 

activities for four reactors at two sites and conducts 

inspections of vendors supplying the components for 

these new plants. The agency’s primary challenge is 

to license new reactors to ensure that they will operate 

safely as they provide electricity required by the 

Table 2

FY 2013 Security Goal Performance Measures (continued)

4. Number of substantial breakdowns6 of physical security or material control (i.e., access control, containment, 

or accountability systems) that significantly weakened the protection against theft, diversion, or sabotage.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target ≤ 1 ≤ 1 ≤ 1 ≤ 1 ≤ 1 ≤ 1

Actual 0 0 0 0 0 0

6

 A “substantial breakdown” is defined as a red finding in the security cornerstone of the ROP, or any plant or facility 

determined to either have overall unacceptable performance or be in a shutdown condition (inimical to the effective 

functioning of the Nation’s critical infrastructure) as a result of significant performance problems and/or operational 

events.  

5. Number of significant unauthorized disclosures7 of classified and/or Safeguards Information.

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013

Target 0 0 0 0 0 0

Actual 0 0 0 0 0 0

7

 “Significant unauthorized disclosure” is defined as a disclosure that harms national security or public health or 

safety.  
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 13

Nation for economic growth. Some of the proposed 

new reactors under consideration are small modular 

reactors. In any case, before licensing any new 

nuclear reactor, the agency requires a detailed analysis 

of new reactor designs. This analysis includes a study 

of the reactor’s vulnerability to accidents and security 

compromises. It also includes the development of 

inspection procedures, tests, analyses, and acceptance 

criteria for construction. The NRC is also evaluating 

commercial gas centrifuge facilities that use new 

methods of enriching nuclear fuel for reactors.

Safe Disposal of High-Level 

Waste

Current law specifies that high-level radioactive waste 

will be disposed of underground in a deep geologic 

repository. On August 13, 2013, the U.S. Court of 

Appeals for the District of Columbia granted a writ of 

mandamus directing the agency to “promptly continue 

the legally mandated licensing process.”

In June 2012, the U.S. Appeals Court for the District 

of Columbia Circuit struck down a provision in NRC 

regulations known as the “Waste Confidence Rule.” 

Waste Confidence is a generic finding that spent 

nuclear fuel can be stored safely for decades at reactor 

sites in either spent fuel pools or dry storage casks and 

that a repository will be available for final disposal of 

the spent fuel. It does not authorize extended storage 

of spent fuel at reactor sites, but it allows the NRC to 

proceed with environmental reviews of new reactors 

or reactor license renewal without considering 

the site-specific effects of spent fuel storage in the 

environmental analysis. 

The NRC released drafts of the rule and report for 

public comment in September 2013. The rule and the 

report are due by September 2014. Meanwhile, the 

Commission said the NRC will make no final licensing 

decisions on new reactors or reactor license renewals 

until the agency finishes the Waste Confidence work.

Security at Nuclear 

Facilities

The security of nuclear materials is of paramount 

importance to the Nation. Nuclear facilities are 

among the most secure facilities in the Nation. 

The NRC, in concert with other Federal agencies, 

constantly monitors intelligence to determine the 

level of threat faced by nuclear facilities. The agency 

continues to improve the regulatory requirements to 

better ensure the security of nuclear materials and 

facilities. The threat faced by the Nation from those 

seeking to steal classified information has become 

more urgent in recent years. Nuclear facilities have 

implemented increased security measures, including 

“force-on-force” training exercises, to help ensure 

protection of this vital national infrastructure.

The agency has also focused on security concerns 

related to radioactive sources typically employed by 

radiation medicine and other non-power applications 

of nuclear technology. The sheer number of 

radioactive sources – numbering thousands in the 

United States alone – creates challenges in securing 

these sources. Moreover, these sources are widely 

spread geographically and used for a broad range of 

purposes. The agency will continue to evaluate ways 

to enhance its ability to account for these sources.

INSPECTOR GENERAL’S 

ASSESSMENT OF THE MOST 

SERIOUS MANAGEMENT 

AND PERFORMANCE 

CHALLENGES FACING NRC

BACKGROUND AND 

OBJECTIVES

On January 24, 2000, Congress enacted the Reports 

Consolidation Act of 2000, requiring Federal agencies 

to provide financial and performance management 

information in a more meaningful and useful 
14 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

format for Congress, the President, and the public. 

The act requires the Inspector General (IG) of each 

Federal agency to annually summarize what he or 

she considers to be the most serious management 

and performance challenges facing the agency and 

to assess the agency’s progress in addressing those 

challenges.

To accomplish this assessment, the IG considered the 

overall work of the Office of the Inspector General 

(OIG), the OIG staff ’s general knowledge of agency 

operations, and other relevant information to develop 

and update the list of management and performance 

challenges and assess the agency’s progress in 

addressing these challenges. In addition, OIG staff 

sought input from NRC’s Chairman, Commissioners, 

and management to obtain their views on what 

challenges the agency is facing and what efforts 

the agency has taken or are underway to address 

previously identified management and performance 

challenges.

RESULTS IN BRIEF

The NRC’s mission is to license and regulate the 

Nation’s civilian use of byproduct, source, and special 

nuclear materials to ensure adequate protection of 

public health and safety, promote the common defense 

and security, and protect the environment. Like 

other Federal agencies, NRC faces management and 

performance challenges in carrying out its mission. 

Congress left the determination and threshold of what 

constitutes a most serious management and performance 

challenge to the discretion of the IGs. The IG has defined 

serious management and performance challenges as 

mission critical areas or programs that have the potential 

for a perennial weakness or vulnerability that, without 

substantial management attention, would seriously impact 

agency operations or strategic goals. 

Based on this definition, the IG has identified the following as the most serious management and performance 

challenges facing NRC as of October 1, 2013:

Most Serious Management and Performance Challenges Facing NRC as of October 1, 2013* (as identified 

by the Inspector General)

Challenge 1 Management of regulatory processes to meet a changing environment in the oversight of nuclear 

materials.

Challenge 2 Management of NRC security programs.

Challenge 3 Management of regulatory processes to meet a changing environment in the oversight of nuclear 

facilities.

Challenge 4 Management of regulatory processes associated with high-level radioactive waste.

Challenge 5 Management of information technology.

Challenge 6 Administration of all aspects of financial management and procurement.

Challenge 7 Management of human capital.

*The most serious management and performance challenges are not ranked in any order of importance.

CONCLUSION 

The seven challenges contained in this report are distinct, yet are interdependent to accomplishing NRC’s mission. 

For example, the challenge of managing human capital affects all other management and performance challenges. 

The agency’s continued progress in taking actions to address the challenges presented should facilitate achievement 

of the agency’s mission and goals.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 15

I am pleased to present the condensed financial statements for the U.S. Nuclear 

Regulatory Commission’s (NRC’s) Fiscal Year (FY) 2013 Summary of Performance 

and Financial Information. For the tenth consecutive year, an independent auditor 

has rendered an unqualified opinion on the NRC financial statements. The auditor 

has also rendered an unqualified opinion on the NRC’s internal control over financial 

reporting and concluded that the NRC is compliant with pertinent provisions of laws 

and regulations. 

Receiving this most recent clean opinion was particularly notable since FY 2013 

provided the NRC with challenging workload and budgetary conditions. Significant 

portions of the agency’s planned regulatory activities are dependent on dynamic 

requests for new design and facility licensing reviews influenced by energy market 

fluctuations. Additionally, emerging issues affecting existing NRC reactor and fuel facility licensees resulting 

from lessons learned from the reactor accident at the Fukushima Dai-ichi Nuclear Station in Japan created new 

demands for the NRC not initially anticipated in the budget. Similarly, the level of agency budgeted resources 

were uncertain with the Government-wide prolonged Continuing Resolution, sequestration, and a rescission to 

the NRC FY 2013 appropriations. The successful redistribution of limited agency resources to address the highest 

priority regulatory activities and effective accounting for the use of funds in our financial statements is a tribute to 

the talent and dedication of the NRC’s financial managers and staff. 

In FY 2013, the NRC continued its modernization of financial systems with the transition to a new strategic 

acquisition system that seamlessly integrates with the agency’s financial accounting system to provide timely 

and accurate financial information of contracting transactions with improved internal control. The NRC was 

also actively engaged with the U.S. Department of the Treasury to support its Government-wide new reporting 

initiatives: Government-wide Treasury Account Symbol Adjusted Trial Balance System, the Central Accounting 

Reporting System, and the Intra-Governmental Transactions Quarterly Score Card. These activities should 

put the agency in a sound position to continue with both agency and Government-wide financial management 

systems improvements in future years. 

The NRC implemented an update to its programmatic internal control framework in FY 2013 based on Federal 

best practices. The updated framework ensures alignment with the agency’s strategic plan, budget structure, 

and performance reporting; streamlines and improves agency processes and administrative requirements into a 

more interdependent approach; and increases management’s accountability for the effectiveness of the agency’s 

programmatic internal control. 

The NRC is committed to ensuring the safety and security of the Nation’s civilian use of nuclear materials in the 

most effective and efficient manner. The regulation of the Nation’s nuclear industries during times of fiscal and 

regulatory challenges requires careful stewardship of limited agency resources and demands superior financial 

performance. I am proud of the progress we have made during this past year to promote sound business practices 

in accomplishing our regulatory mission and am confident that we will continue to make improvements.

J.E. Dyer, Chief Financial Officer

March 10, 2014

A MESSAGE FROM THE CHIEF FINANCIAL OFFICER
16 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

FINANCIAL 

PERFORMANCE OVERVIEW

The NRC prepared its financial statements in 

accordance with the accounting standards codified 

in the Statements of Federal Financial Accounting 

Standards (SFFAS) and the Office of Management and 

Budget (OMB) Circular A-136, “Financial Reporting 

Requirements.”

As of September 30, 2013, the financial condition of 

the NRC was sound with respect to having sufficient 

funds to meet program needs and the NRC had 

adequate control of these funds in place to ensure that 

obligations did not exceed budget authority. 

Sources of Funds 

The NRC has two appropriations, Salaries and 

Expenses and the Office of the Inspector General. 

The new FY 2013 budget authority was $985.6 million, 

which included $975.2 million for the Salaries and 

Expenses appropriation and $10.4 million for the 

Office of the Inspector General.

The new appropriated funding for both appropriations 

remained the same as the prior year ($1,027.2 million 

for the Salaries and Expenses appropriation and 

$10.9 million for the Office of the Inspector General). 

The new budget authority for FY 2013 decreased 

$52.5 million compared to the FY 2012 budget 

authority due to the FY 2013 sequestration and 

rescission of funds returned to the U.S. Treasury 

(Treasury), $52.0 million for the Salaries and Expenses 

appropriation and $0.5 million for the Office of the 

Inspector General. 

Budget Authority (in millions)

Appropriation FY 2013 FY 2012

Salaries and Expenses $ 1,027.2 $ 1,027.2

 Less: Sequestration (51.7) -

 Less: Rescission (.3) -

 Budget Authority 975.2 1,027.2

Office of the Inspector 

General 10.9 10.9

 Less: Sequestration (.5) -

 Less: Rescission - -

 Budget Authority 10.4 10.9

Total NRC Budget 

Authority $ 985.6 $ 1,038.1

Funds available for the NRC to obligate in FY 2013 

were $1,069.8 million and included $985.6 million 

of new budget authority, $40.5 million of prior-year 

appropriations, $11.9 million of prior-year funding 

for reimbursable work, $14.9 million of recoveries of 

prior-year unpaid obligations, $6.4 million of FY 2013 

reimbursable work performed for other Federal 

agencies and commercial customers, and $10.5 million 

of prior-year funding for resources received from 

the U.S. Department of Energy (DOE) to fund NRC 

activities associated with the Nuclear Waste Policy Act 

of 1982, as amended. Funds available to obligate in 

FY 2013 decreased $38.7 million from the FY 2012 

amount of $1,108.1 million.

The Omnibus Budget Reconciliation Act of 1990

(OBRA-90), as amended, requires the NRC to collect 

fees to offset approximately 90 percent of its new 

budget authority, less the amount appropriated to 

the NRC from the Nuclear Waste Fund and amounts 

appropriated for waste incidental to reprocessing and 

generic homeland security. Fees collected are returned 

to the Treasury to offset the NRC’s two appropriations.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 17

Uses of Funds by Function 

The NRC incurred obligations of $1,027.1 million 

in FY 2013, which represented a decrease of 

$18.1 million from the FY 2012 amount of 

$1,045.2 million (see Figure 3). Approximately 

58 percent of obligations in FY 2013 were used for 

salaries and benefits. The NRC used the remaining 

42 percent to obtain technical assistance for the 

NRC’s principal regulatory programs, to conduct 

confirmatory safety research, to fund operating 

expenses (e.g., building rentals, transportation, 

printing, security services, supplies, office automation, 

and training), and to pay for staff travel. 

The unobligated budget authority available at the 

end of FY 2013 was $42.8 million, which was a 

$20.1 million decrease from the FY 2012 amount 

of $62.9 million. Of the $42.8 million unobligated 

balance at the end of FY 2013, $9.0 million was for 

reimbursable work, $11.0 million was for the Nuclear 

Waste Fund, and $22.8 million was available to fund 

critical NRC needs in FY 2014. The $62.9 million 

unobligated balance at the end of FY 2012 included 

$11.9 million for reimbursable work, $10.5 million for 

the Nuclear Waste Fund, and $40.5 million for funding 

of critical NRC needs in FY 2013.

Figure 2

Sources of Funds for Budget 

Authority

Reactor

Fees

800

600

400

200

0

IN MILLIONS

Material

Fees

$798.5 $761.6

2012

$95.8 $90.3

$0.0 $0.0

$133.7 $143.8

Nuclear

Waste

General

Fund

2013

Figure 3

Uses of Funds by Function 

(Obligations)

Salaries and

Benefits

IN MILLIONS

Travel Grants

$597.9

$592.3 2012

$27.3 $23.4 $12.8 $7.5

$380.4 $388.6

Reimbursable

Work

Contract

Support

$26.8 $15.3

2013

600

500

400

300

200

100

0

The Salaries and Expenses new budget authority 

is offset by approximately 90 percent from the 

collection of fees from licensees and is available for 

obligation until expended. The new budget authority 

for the Office of the Inspector General is a two-year 

(FY 2013/2014) appropriation that expires at the 

end of FY 2014. Ninety percent of the new budget 

authority for the Office of the Inspector General 

appropriation is recoverable from the collection of fees 

and is retained in a separate no-year account, which is 

available for obligation until expended.

The approximate amount projected to be recovered 

from fees in FY 2013 was $864.0 million, which 

included $859.6 million from FY 2013 reactor and 

materials fees and $4.4 million from other fees 

(unpaid current-year invoices and terminated reactors’ 

FY 2013 annual fee collections, offset by payments of 

prior-year invoices in FY 2013). The NRC collected 

fees totaling $851.9 million in FY 2013 (see Figure 2), 

which is 98.6 percent of the approximately 

$864.0 million projected to be recovered. Fee 

collections decreased $42.4 million in FY 2013 

compared to the FY 2012 amount of $894.3 million, 

mainly due to the FY 2013 sequestration and 

rescission.
18 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Assets. The NRC’s total assets (see Figure 4) were 

$522.8 million as of September 30, 2013, representing 

a decrease of $47.1 million from the FY 2012 year-end 

total of $569.9 million. Changes in major categories 

include decreases of $39.3 million in the Fund Balance 

with Treasury, $8.8 million in Accounts Receivable, 

Net, and $6.8 million in Other Assets, offset by an 

increase of $7.8 million in Property & Equipment, Net.

The Fund Balance with Treasury was $318.2 million as 

of September 30, 2013, which accounts for 61 percent 

of total assets. This account represents appropriated 

funds and other funds maintained at the Treasury to 

pay for current liabilities and to finance authorized 

purchase commitments. The $39.3 million decrease in 

the fund balance from the prior year was primarily the 

result of decreases of $37.1 million in the beginning 

balance and $52.5 million in funding for new budget 

authority, offset by a $50.3 million decrease in gross 

outlays (disbursement activity). The decrease in gross 

outlays, which results in increasing the fund balance, 

primarily consisted of decreases of $11.0 million in 

salaries and benefits disbursements, $3.5 million in 

travel costs, and $36.3 million in contract support 

services, offset by an increase of $0.5 million in grant 

disbursements.

Accounts receivable primarily consists of amounts 

that other Federal agencies and the public owe to 

Audit Results 

The NRC received an unqualified audit opinion on its 

FY 2013 financial statements and internal controls. 

The auditors found no reportable instances of 

noncompliance with laws and regulations during the 

FY 2013 audit.

The Summary of the Financial Statement Audit and 

Management Assurances is included on page 32 of 

this report.

Limitations on the Financial 

Statements

The financial statements have been prepared to 

report the financial position and results of operations 

of the NRC, pursuant to the requirements of 

31 U.S.C. 3515 (b). While the statements have been 

prepared from the books and records of the NRC 

in accordance with Generally Accepted Accounting 

Principles (GAAP) 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 statements 

should be read with the realization that they are for 

a component of the U.S. Government, a sovereign 

entity. The condensed financial statements presented 

in this report (see pages 30 and 31) are drawn from 

the financial statements presented in the FY 2013 

Performance and Accountability Report.

FINANCIAL STATEMENT 

HIGHLIGHTS 

The NRC’s condensed financial statements summarize 

the financial activity and the financial position of the 

agency.

Analysis of the Balance 

Sheet 

The Balance Sheet, which shows the NRC’s assets, 

liabilities, and net position, is summarized in the 

Condensed Balance Sheet on page 30.

Figure 4

Asset Summary (in millions)

Other, $5.0

1%

Property and 

Equipment,

Net, $107.8

21%

Fund Balance

with Treasury, 

$318.2

61%

Accounts

Receivable, 

Net, $91.8

17%
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 19

Figure 5

Liabilities Summary (in millions)

Federal

Employee

Benets,

$7.0

6%

Other* 

$74.5

62%

Accounts

Payable,

$38.0

32%

the NRC for license fees. Accounts Receivable, Net, 

as of September 30, 2013, was $91.8 million, which 

included an offsetting allowance for doubtful accounts 

of $1.8 million. For FY 2012, the year-end Accounts 

Receivable, Net, balance was $100.6 million, including 

an offsetting allowance for doubtful accounts of 

$1.6 million. 

Property and Equipment consist primarily of typical 

office furnishings, leasehold improvements, nuclear 

reactor simulators, and computer hardware and 

software. (The NRC has no real property. The land 

and buildings in which the NRC operates are leased 

from the General Services Administration.) At the 

end of FY 2013, net property and equipment was 

$107.8 million, an increase of $7.8 million from the 

FY 2012 amount of $100.0 million. The increase 

is primarily due to an increase of $8.6 million in 

leasehold improvements, mainly for improvements 

to the NRC Headquarters buildings; offset by a 

decrease of $0.8 million in IT software. Leasehold 

improvements were $87.5 million in FY 2013 and 

$78.9 million in FY 2012 and include improvements 

to the NRC’s leased buildings for Headquarters 

(including the new Three White Flint North building) 

and regional offices. IT software was $18.8 million in 

FY 2013 compared to $19.6 million in FY 2012.

Liabilities. Total liabilities (see Figure 5) were 

$119.5 million as of September 30, 2013, representing 

a decrease of $5.1 million from the FY 2012 year-end 

balance of $124.6 million. Accounts Payable, Federal 

Employee Benefits, and Other Liabilities remained 

approximately the same as the prior year. At the end 

of FY 2013, Other Liabilities included $46.8 million 

in accrued annual leave; $10.4 million in accrued 

funded salaries and benefits; $6.6 million in grants 

payable; $5.3 million in advances received by the 

NRC for services that will be provided; $2.5 million in 

funded employee benefit contributions; $1.7 million 

in accrued workers’ compensation; and $1.2 million 

in contract holdbacks, capital lease liability, and 

miscellaneous liabilities. 

Total Liabilities included liabilities not covered by 

budgetary resources, which represent expenses 

recognized in the financial statements that will be paid 

from future appropriations. The liabilities not covered 

by budgetary resources were $55.5 million for FY 2013 

compared to $56.9 million for FY 2012, a $1.4 million 

decrease. As of September 30, 2013, the liabilities not 

covered by budgetary resources represented 46 percent 

of total liabilities and included $46.8 million in 

unfunded accrued annual leave that has been earned 

but not yet taken, $1.7 million in accrued workers’ 

compensation included in Other Liabilities, and 

$7.0 million as an actuarial estimate of accrued future 

workers’ compensation expenses included in Federal 

Employee Benefits. 

Net Position. The difference between Total Assets 

and Total Liabilities, Net Position, was $403.3 million 

as of September 30, 2013, which is a decrease of 

$42.0 million from the FY 2012 year-end balance. 

Net Position is comprised of two components: 

Unexpended Appropriations, the amount of spending 

authority that remains unused at the end of the 

year, and Cumulative Results of Operations, the 

cumulative excess of financing sources over expenses. 

*Other Liabilities: $46.8 Accrued Annual Leave, 

$10.4 Accrued Salaries and Benefits, $6.6 Grants Payable, 

$10.7 Other.
20 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Unexpended Appropriations were $242.7 million at 

the end of FY 2013, a decrease of $42.4 million from 

the end of FY 2012. Cumulative Results of Operations 

increased by $0.4 million from $160.2 million in 

FY 2012 to $160.6 million in FY 2013. 

Analysis of the Statement of 

Net Cost 

The Statement of Net Cost, which links the NRC’s 

program performance to the cost of programs, is 

shown on page 30.

The Statement of Net Cost represents the gross cost of 

the NRC’s two programs (Nuclear Reactor Safety and 

Security and Nuclear Materials Safety and Security) as 

identified in the NRC Annual Performance Plan, offset 

by earned revenue. The purpose of this statement is 

to link program performance to the cost of programs. 

The NRC’s Net Cost of Operations for the year ended 

September 30, 2013, was $210.9 million, representing 

an increase of $63.1 million over the FY 2012 net 

cost of $147.8 million. This includes an increase of 

gross costs of $11.0 million and a decrease in earned 

revenues of $52.1 million, which offset gross costs.

Gross Costs. The NRC’s total gross costs (see 

Figure 6) were $1,063.1 million for FY 2013, an 

increase of $11.0 million from the prior-year amount 

of $1,052.1million. The Nuclear Reactor Safety 

and Security program gross costs for FY 2013 were 

$831.1 million compared to FY 2012 gross costs of 

$824.1 million, an increase of $7.0 million, and the 

Nuclear Materials and Waste Safety and Security 

program gross costs were $232.0 million compared to 

FY 2012 gross costs of $228.0 million, an increase of 

$4.0 million. 

The cost of achieving the agency’s Safety and Security 

goals for the agency’s programs for FY 2013 is the 

gross cost presented in the Statement of Net Cost. 

The total cost for achieving the agency’s Safety goal 

was $995.1 million and the cost of achieving the 

agency’s Security goal was $68.0 million (see Figure 7).

Earned Revenue. Total earned revenue 

(see Figure 8) as of September 30, 2013, was 

$852.2 million, a decrease of $52.1 million from the 

September 30, 2012, earned revenue of $904.3 million. 

The Nuclear Reactor Safety and Security program 

had revenues in FY 2013 of $760.3 million compared 

to FY 2012 revenues of $815.7 million, a decrease of 

$55.4 million primarily due to decreases in operating 

reactor annual fees of $43.7 million and full-cost new 

reactor fees of $22.0 million, offset by an increase in 

full-cost operating reactor fees of $10.3 million. The 

Nuclear Materials and Waste Safety and Security 

program had revenues from license fees in FY 2013 of 

$91.9 million in FY 2013 compared to $88.6 million in 

FY 2012, an increase of $3.3 million.

Figure 6

Gross Costs by Program (in millions)

Nuclear Reactor

Safety and Security, 

$831.1

78%

Nuclear Materials and 

Waste Safety

and Security,

$232.0

22%

Figure 7

Gross Costs by Strategic Goal

(in millions)

For the year ended September 30, 2013

Nuclear Reactor

 Safety and 

Security

Nuclear Materials 

and Waste Safety 

and Security

Security $50.7

Security $17.3

Safety $780.4 

Safety $214.7 
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 21

Figure 8

Earned Revenue by Program 

(in millions)

Nuclear Materials 

and Waste Safety

and Security,

$91.9

11%

Nuclear Reactor

Safety and Security, 

$760.3

89%

Fees collected (earned primarily in FY 2013) were 

$851.9 million compared to $894.4 million for 

FY 2012 (see Figure 2, page 17). The decrease was 

the result of reduced budget authority in FY 2013, 

which reduced the amount of fees from licensees 

that the NRC was required to collect. The NRC is 

required to collect approximately 90 percent of its new 

budget authority through license fee billing. Fees for 

reactor and materials licensing and inspections are 

collected in accordance with 10 CFR Part 170, “Fees 

for Facilities, Materials, Import and Export Licenses, 

and Other Regulatory Services under the Atomic 

Energy Act of 1954, as amended,” and 10 CFR Part 171, 

“Annual Fees for Reactor Licenses and Fuel Cycle 

Licenses and Materials Licenses, Including Holders of 

Certificates of Compliance, Registrations, and Quality 

Assurance Program Approvals and Government 

Agencies Licensed by the NRC.” 

Analysis of the Statement of 

Changes in Net Position 

The Statement of Changes in Net Position, which 

reports NRC’s change in net position for the reporting 

period, is summarized in the Condensed Statement of 

Changes in Net Position on page 31. 

Net position is affected by changes in its two 

components: Cumulative Results of Operations and 

Unexpended Appropriations. The decrease in Net 

Position in FY 2013 of $42.0 million, compared to 

FY 2012, was due to an increase of $0.4 million in 

Cumulative Results of Operations, offset by a decrease 

of $42.4 million in Unexpended Appropriations. 

The increase in Cumulative Results of Operations of 

$0.4 million was primarily comprised of increases in 

the beginning balance of $55.0 million and financing 

sources derived from appropriations of $7.1 million, 

offset by a reduction in the net cost of operations of 

$63.1 million. The net cost of operations decrease was 

due an increase in gross costs of $11.0 million and a 

decrease in earned revenue of $52.1 million.

A change in unexpended appropriations results 

primarily from appropriations received being more, 

or less, than appropriations used and adjustments 

(e.g., sequestration, rescission) during the fiscal year. 

In FY 2013, unexpended appropriations decreased 

$42.4 million from FY 2012. Appropriations received 

of $186.2 million consisted primarily of the NRC’s 

total appropriation of $1,038.1 million, reduced 

by $851.9 million in fee collections. Adjustments 

to unexpended appropriations were due to the 

sequestration and rescissions totaling $52.5 million. 

In financing the $1,028.1 million cost of current 

year operations, the NRC consumed $851.9 million 

of license fees collected and $176.2 million in 

appropriations.
22 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

MANAGEMENT 

ASSURANCES, SYSTEMS 

CONTROLS, AND LEGAL 

COMPLIANCE

This section provides information on NRC’s 

compliance with the Federal Managers’ Financial 

Integrity Act of 1982 (Public Law 97-255), OMB 

Circular A-123, “Management’s Responsibility 

for Internal Control, and the Federal Financial 

Management Improvement Act of 1996.”

Federal Managers’ 

Financial 

Integrity Act

The Federal Managers’ Financial 

Integrity Act of 1982 (Integrity Act) 

mandates that agencies establish 

internal control to provide reasonable 

assurance that the agency complies 

with applicable laws and regulations; 

safeguards assets against waste, loss, 

unauthorized use, or misappropriation; 

and properly accounts for and records 

revenues and expenditures. The 

Integrity Act encompasses program, 

operational, and administrative areas, 

as well as accounting and financial 

management. It also requires the 

Chairman to provide an assurance 

statement on the adequacy of internal 

controls and on the conformance of 

financial systems with Governmentwide standards, shown below.

Programmatic 

Internal Control

Internal control is the organization, 

policy, and procedures that help 

managers achieve intended results 

and safeguard the integrity of their programs. 

NRC managers are responsible for designing and 

implementing effective internal control in their areas 

of responsibility. Each NRC business and corporate 

support product line manager prepares an annual 

assurance certification that identifies any control 

weaknesses requiring the attention of the NRC 

Executive Committee on Internal Control (ECIC). 

These certifications are based on internal control 

activities such as probabilistic risk assessments, as 

well as other activities, such as Integrated Regulatory 

Review Service self-assessments, Construction and 

U.S. NUCLEAR REGULATORY COMMISSION

FISCAL YEAR 2013 FEDERAL MANAGERS’ 

FINANCIAL INTEGRITY ACT STATEMENT

The U.S. Nuclear Regulatory Commission (NRC) managers are responsible for 

establishing and maintaining effective internal control and financial management 

systems that meet the objectives of the Federal Managers’ Financial Integrity 

Act (Integrity Act). The NRC conducted its assessment of internal control over 

programmatic operations in accordance with Office of Management and Budget (OMB) 

Circular A-123, Management’s Responsibility for Internal Control (A-123) guidelines. 

Based on the results of this evaluation, NRC can provide reasonable assurance that its 

internal control over programmatic operations is in compliance with applicable laws 

and guidance, and no material weaknesses were found as of September 30, 2013.

In addition, NRC conducted its assessment of the effectiveness of internal control 

over financial reporting, which includes safeguarding of assets and compliance with 

applicable laws and regulations, in accordance with the requirements of Appendix A of 

A-123. Based on the results of the evaluation, NRC can provide reasonable assurance 

that its internal control over financial reporting as of June 30, 2013, was operating 

effectively, and no material weaknesses were found in the design or operation of the 

internal control over financial reporting.

The NRC can also provide reasonable assurance that its financial systems substantially 

comply with applicable Federal accounting standards as required by the Federal 

Financial Management Improvement Act of 1996.

Allison M. Macfarlane

Chairman

U.S. Nuclear Regulatory Commission

December 16, 2013
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 23

Reactor Oversight Process, Integrated Materials 

Performance Evaluation Program, Waste Confidence, 

Fukushima Dai-ichi Task Force Lessons Learned, 

Agency Action Review Meeting outcomes, financial 

statement audits, Inspector General and U.S. 

Government Accountability Office audits and reports, 

and other information provided by the congressional 

committees of jurisdiction.

The ECIC consists of senior executives from the 

Office of the Chief Financial Officer and the Office of 

the Executive Director for Operations. The agency’s 

General Counsel and Inspector General participate as 

advisors. 

The ECIC met to review the reasonable assurance 

certifications provided by the NRC business and 

corporate support product line managers. The ECIC 

then informed the Chairman as to whether the NRC 

had any internal control deficiencies serious enough to 

require reporting as a weakness or noncompliance. 

The NRC’s programmatic and financial internal 

control programs require that internal control 

deficiencies be documented and reported in business 

line quarterly performance reports and internal 

control plans. Together, both ensure that key issues 

receive senior management attention. Combined 

with the individual assurance statements discussed 

previously, the internal control information in these 

plans provides the framework for monitoring and 

improving the agency’s internal control on an ongoing 

basis.

FY 2013 Integrity Act Results 

In FY 2013, the Chief Financial Officer (CFO) 

and the Executive Director for Operations (EDO) 

issued agency-wide programmatic internal control 

and reasonable assurance guidance that provided 

information on the planned implementation of an 

updated programmatic internal control framework. 

The updated framework, led by the agency’s 

Branch Chief for Programmatic Internal Control 

and Planning, addressed the five Government 

Accountability Office (GAO) Standards for 

Internal Control, as well as GAO’s Risk Assessment 

Monitoring Tool, and the Committee of Sponsoring 

Organizations of the Treadway Commission, Internal 

Control – Integrated Framework. The updated 

framework streamlined the agency’s programmatic 

internal control processes, reduced administrative 

requirements on program and technical staff, better 

leveraged existing programmatic internal control 

activities across business lines, and significantly 

improved communication channels between the 

business lines, partner offices, and the corporate 

support offices.

As part of the FY 2013 guidance, NRC business 

and corporate support product lines were asked 

to certify that there was reasonable assurance that 

internal control was in place to achieve the following 

objectives:

•	 programs achieved their intended results, and

are protected from waste, fraud, abuse, and 

mismanagement;

•	 resources were used consistently with the agency’s

mission;

•	 information systems were authorized and

appropriately secured;

•	 laws and regulations were followed; and

•	 reliable and timely information was obtained,

maintained, reported, and used for sound decisionmaking. 

The NRC evaluated its updated programmatic 

internal control framework for the fiscal year ending 

September 30, 2013. Based on this evaluation, the 

NRC is able to provide a statement of assurance that 

its programmatic internal control met the objectives of 

the Integrity Act. The NRC has reasonable assurance 

that its internal control is effective and conforms to 

Government-wide standards.
24 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Office of Management and 

Budget Circular A-123, 

“Management’s Responsibility 

for Internal Control”

Internal Control Over 

Financial Reporting 

(Appendix A)

In FY 2006, the NRC implemented the requirements 

of the revised OMB Circular A-123, which defined 

and strengthened management’s responsibility for 

internal control in Federal agencies.  The revised 

circular included updated internal control standards.  

Appendix A to this circular requires Federal agencies 

to assess the effectiveness of internal controls over 

financial reporting and to prepare a separate annual 

statement of assurance as of June 30, 2013.

The NRC adopted a 3-year rotational testing plan for 

internal control over financial reporting.  The agency 

determined that three of the nine key processes 

(financial reporting, revenue, and IT) were significant 

enough to include in the testing each year of the 

3-year cycle.  The remaining six key processes were 

to be tested once in the 3-year cycle, two each year.  

In FY 2013, the NRC continued its assessment of 

internal control over financial reporting.  The agency 

reevaluated its scope of financial reports, materiality 

values, risk assessments, key processes, and key 

controls.  Based on the results of this evaluation, 

the NRC can provide reasonable assurance that its 

internal control over financial reporting was operating 

effectively as of June 30, 2013, and that the evaluation 

found no material weaknesses in design or operation 

of the internal controls over financial reporting.

Requirements for 

Effective Measurement 

and Remediation of 

Improper Payments 

(Appendix C)

In FY 2011, OMB revised Parts I and II of Appendix C 

to OMB Circular A-123.  Appendix C, “Requirements 

for Effective Measurement and Remediation of 

Improper Payments,” as amended, implemented the 

Improper Payments Information Act (IPIA) of 2002 and 

the Improper Payments Elimination and Reporting Act

(IPERA) of 2010.  The purpose of this guidance was to 

reduce improper payments, hold agencies accountable 

for reducing improper payments, and increase 

penalties for contractors who fail to disclose improper 

payments in a timely manner. The NRC complied 

with this guidance by incorporating improper 

payments testing in its FY 2011 OMB Circular A-123, 

Appendix A, assessment.

The FY 2011 testing yielded an estimated improper 

payment rate of 0.02 percent and an estimated 

improper payment amount of less than $27,000. These 

results fall below the IPERA thresholds of 2.5 percent 

of program outlays and $10 million, of all program or 

activity payments made, or $100 million. Therefore, 

after discussions with OMB, it was determined that 

the NRC would conduct this testing every 3 years, in 

accordance with the IPERA and OMB guidance. The 

next review is scheduled for FY 2014.

In addition to the testing completed in FY 2011, 

Office of the Chief Financial Officer staff determined 

that $4.2 million in duplicate payments were made in 

July 2013. These errors were identified and corrected. 

The NRC will continue to monitor its payments in 

FY 2014, in addition to conducting testing already 

planned for the year.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 25

Federal Financial 

Management Improvement 

Act

The Federal Financial Management Improvement Act 

of 1996 (FFMIA) requires each agency to implement 

and maintain systems that comply substantially 

with (1) Federal financial system requirements, 

(2) applicable Federal accounting standards, and 

(3) the standard general ledger at the transaction level. 

FFMIA requires the Chairman to determine whether 

the agency’s financial management system complies 

with FFMIA and to develop remediation plans for 

systems that do not comply.

FY 2013 FFMIA Results

As of September 30, 2013, the NRC evaluated its 

financial systems and found that they comply with 

applicable Federal requirements and accounting 

standards required by FFMIA. In making this 

determination, the agency considered all available 

information, including the report from the ECIC 

on the effectiveness of internal control, Office of the 

Inspector General audit reports, and the result of the 

agency’s financial management system reviews.

Financial Management 

Systems Strategies

During FY 2013, the NRC continued to make 

substantial progress in modernizing its financial 

systems. System performance, data integrity, 

business processes, user expertise, and reporting 

were all enhanced for the Financial Accounting 

and Integrated Management Information System 

(FAIMIS) Core Financial System (CFS). The NRC 

specifically implemented additional user system 

training, developed a reporting dashboard and an 

interactive reporting tool, and further standardized 

job codes. Also, the NRC successfully developed 

both the NRC Strategic Acquisition System (STAQS) 

and STAQS software integration with FAIMIS. Both 

STAQS and the STAQS integration with FAIMIS 

will be implemented in FY 2014. This completes a 

major milestone in automating, streamlining, and 

integrating the NRC acquisition processes and fully 

automating the system with the agency’s CFS. The 

agency also began implementing plans to move to 

the E-Gov Travel Service 2 (ETS2) system, which will 

be completed in FY 2014. Upgrades are planned in 

FY 2014 for both the FAIMIS and Time and Labor 

Modernization (TLM) system to address legislative 

requirements, strengthen controls, and further 

automate system processes. In addition, the Budget 

Formulation System (BFS) will be implementing a 

Spend Plan Tool to automate and enhance the agency’s 

current funds utilization process. Also, the NRC is 

pursuing implementation of the FAIMIS Momentum 

software Invoice Approval Processing functionality 

within the CFS to improve the current approval 

process. 

Prompt Payment

The Prompt Payment Act of 1982, as amended, 

requires Federal agencies to make timely payments 

to vendors for supplies and services, to pay interest 

penalties when payments are made after the due 

date, and to take cash discounts when they are 

economically justified. In FY 2013, the NRC paid 

97 percent of the 8,759 invoices subject to the Prompt 

Payment Act on time.

2005 2006 2007 2008 2009 2010 2011

96%

2012

100%

98%

96%

94%

92%

90%

88%

86%

84%

96%

98%

95%

93%

89%

98% 97%

95%

2013

Figure 9

Payment Percentage
26 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Debt Collection

The Debt Collection Improvement Act of 1996 enhances 

the ability of the Federal Government to service and 

collect debts. The agency’s goal is to maintain the level 

of delinquent debt owed to the NRC at year end to less 

than 1 percent of its annual billings. The NRC met 

this goal. At the end of FY 2013, delinquent debt was 

$7.5 million or 1 percent of annual billings. The NRC 

was able to refer 97.4 percent of all eligible debt over 

180 days delinquent to the Treasury for collection. 

This success was due to an extensive cleanup effort 

resulting from the deployment of a new accounting 

system and process changes. The NRC hopes to 

continue this success through FY 2014. 

2007 2008 2009 2010 2011

$10.7

$1.4 $1.4 $0.9 $1.1 $1.5

2012 2013

$12.0

$10.0

$8.0

$6.0

$4.0

$2.0

$0

$7.5

Figure 10

Delinquent Debt (in millions)

Biennial Review of User Fees

The Chief Financial Officers Act of 1990 requires 

agencies to conduct a biennial review of fees, royalties, 

rents, and other charges imposed by agencies and to 

make revisions to cover program and administrative 

costs incurred. Each year, the NRC revises the hourly 

rates for license and inspection fees and adjusts the 

annual fees to meet the fee collection requirements 

of OBRA-90, as amended, which requires the NRC to 

recover through fees approximately 90 percent of its 

budget authority in FY 2013, not including amounts 

appropriated for Waste Incidental to Reprocessing 

(WIR) and amounts appropriated for generic 

homeland security activities. 

On July 1, 2013, the NRC issued a final rule in the 

Federal Register amending the licensing, inspection, 

and annual fees charged to its applicants and 

licensees. Based on the Consolidated and Further 

Continuing Appropriations Act of 2013, the NRC’s 

required fee recovery amount for the FY 2013 

budget is $864.0 million. After accounting for billing 

adjustments, the total amount to be billed as fees to 

licensees is $859.6 million. The NRC Fee Recovery 

Schedules for FY 2013 are located at http://www.gpo.

gov/fdsys/pkg/FR-2013-07-01/pdf/2013-15529.pdf.

Inspector General Act 

of 1978

The NRC has established and continues to maintain 

an excellent record in resolving and implementing 

Office of the Inspector General open audit 

recommendations.
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 27

UNITED STATES

NUCLEAR REGULATORY COMMISSION

WASHINGTON, D.C. 20555-0001

OFFICE OF THE

INSPECTOR GENERAL

March 31, 2014

MEMORANDUM TO: Chairman Macfarlane

FROM: Hubert T. Bell /RA/

Inspector General

SUBJECT: TRANSMITTAL OF THE INDEPENDENT AUDITORS’

REPORT ON THE CONDENSED FINANCIAL 

STATEMENTS (OIG-14-A-13) 

Office of Management and Budget Circular No. A-136, Financial Reporting 

Requirements, Revised, October 21, 2013, requires all entities covered under The Chief 

Financial Officers Act of 1990 to prepare a summary of performance and financial

information which summarizes performance and accountability results for the fiscal 

year. The summary report should include the most important performance and financial 

information contained in NRC’s Performance and Accountability Report in a brief, userfriendly format that is easily understood by a reader with little technical background in 

these areas. The purpose of this memorandum is to transmit CliftonLarsonAllen LLP 

(CLA) Auditors’ Report on the Condensed Financial Statements. NRC publishes this

report and condensed financial statements as part of the Fiscal Year 2013 Summary Of

Performance And Financial Information. 

CLA is responsible for the attached auditor’s opinion, dated March 26, 2014. The Office 

of the Inspector General (OIG) is responsible for technical and administrative oversight 

regarding the firm’s performance under the terms of the contract. Our oversight of 

CLA’s work, as differentiated from an audit in conformance with Government Auditing 

Standards, was not intended to enable us to express, and accordingly we do not 

express, an opinion on the condensed financial statements included in the summary

report. However, OIG’s oversight of CLA’s work disclosed no instances where CLA did 

not comply with applicable auditing standards. 

We appreciate the cooperation provided by NRC staff.

Attachment: As stated

INSPECTOR GENERAL’S TRANSMITTAL LETTER
28 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

CliftonLarsonAllen LLP

www.cliftonlarsonallen.com

Independent Auditors’ Report on Condensed Financial Statements

Inspector General

United States Nuclear Regulatory Commission

Chairman

United States Nuclear Regulatory Commission

The accompanying condensed financial statements, which comprise the condensed balance 

sheets as of September 30, 2013 and 2012, the statement of net cost and condensed statement

of changes in net position for the years then ended are derived from the audited financial 

statements of the United States Nuclear Regulatory Commission (NRC) as of and for the years

ended September 30, 2013 and 2012. We expressed an unmodified audit opinion on those 

audited financial statements in our report dated December 2, 2013. The audited financial 

statements, and the condensed financial statements derived therefrom, do not reflect the effects 

of events, if any, that occurred subsequent to the date of our report on the audited financial 

statements.

The condensed financial statements do not contain the statement of budgetary resources and 

all the disclosures required by accounting principles generally accepted in the United States of 

America. Reading the summary financial statements, therefore, is not a substitute for reading 

the audited financial statements of NRC.

Management's Responsibility for the Condensed Financial Statements

Management is responsible for the preparation of the condensed financial statements in 

accordance with accounting principles generally accepted in the United States of America.

Auditor's Responsibility

Our responsibility is to express an opinion about whether the condensed financial statements 

are consistent, in all material respects, with the audited financial statements based on our 

procedures, which were conducted in accordance with auditing standards generally accepted in 

INDEPENDENT AUDITORS’ REPORT ON 

THE CONDENSED FINANCIAL STATEMENTS
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 29

Independent Auditors’ Report on Condensed Financial Statements (Continued)

the United States of America; and the standards applicable to financial audits contained in 

Government Auditing Standards, issued by the Comptroller General of the United States. The 

procedures consisted principally of comparing the condensed financial statements with the 

related information in the audited financial statements from which the condensed financial 

statements have been derived, and evaluating whether the condensed financial statements are 

prepared in accordance with accounting principles generally accepted in the United States of 

America. We did not perform any audit procedures regarding the audited financial statements 

after the date of our report on those financial statements. 

Opinion

In our opinion, the condensed financial statements of the NRC as of and for the years ended 

September 30, 2013 and 2012 referred to above are consistent, in all material respects, with the 

audited financial statements from which they have been derived.

Other Reporting Required by Government Auditing Standards

In accordance with Government Auditing Standards, our report on the audited financial 

statements referred to above includes an opinion on the effectiveness of internal control over 

financial reporting and a report on compliance with laws and regulations for the years ended 

September 30, 2013 and 2012. Those reports are an integral part of a financial statement audit 

performed in accordance with Government Auditing Standards in considering NRC’s internal 

control over financial reporting and compliance. 

Arlington, Virginia

March 26, 2014
30 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Condensed Balance Sheet* (In Thousands)

As of September 30, 2013 2012

Assets

Fund balance with Treasury $ 318,244 $ 357,529 

Accounts receivable, net 91,808 100,606 

Property and equipment, net 107,771 99,982 

Other 4,952 11,750

Total Assets $ 522,775 $ 569,867 

Liabilities

Accounts payable $ 38,048 $ 43,172 

Federal employee benefits 7,023 7,224 

Other 74,427 74,197 

Total Liabilities 119,498 124,593 

Net Position

Unexpended appropriations 242,640 285,080 

Cumulative results of operations 160,637 160,194 

Total Net Position 403,277 445,274 

Total Liabilities and Net Position $ 522,775 $ 569,867 

Statement of Net Cost* (In Thousands) 

For the years ended September 30, 2013 2012

Nuclear Reactor Safety and Security

Gross costs $ 831,114 $ 824,091

Less: Earned revenue (760,283) (815,701) 

Total Net Cost of Nuclear Reactor Safety and Security 70,831 8,390 

Nuclear Materials and Waste Safety and Security

Gross costs 232,011 228,000 

Less: Earned revenue (91,959) (88,630) 

Total Net Cost of Nuclear Materials and Waste Safety and 

Security 140,052 139,370 

Net Cost of Operations $ 210,883 $ 147,760

CONDENSED FINANCIAL STATEMENTS
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 31

Condensed Statement of Changes in Net Position* (In Thousands)

For the years ended September 30, 2013 2012

Cumulative Results of Operations

Beginning Balance $ 160,194 $ 105,193

Budgetary Financing Sources 176,651 169,753

Other Financing Sources 34,675 33,008

Net Cost of Operations (210,883) (147,760)

Net Change 443 55,001

Cumulative Results of Operations $ 160,637 $ 160,194

Unexpended Appropriations 

Beginning Balance $ 285,080 $ 310,332 

Budgetary Financing Sources (42,440) (25,252)

Total Unexpended Appropriations 242,640 285,080 

Net Position $ 403,277 $ 445,274 

* For a complete set of financial statements and notes, see Chapter 3, “Financial Statements and Auditors’ Report,” 

beginning on page 75 of the Fiscal Year 2013 Performance and Accountability Report. This report can be accessed 

on the NRC Web site at http://www.nrc.gov/reading-rm/doc-collections/nuregs/staff/sr1542/.

CONDENSED FINANCIAL STATEMENTS
32 ⎟ FISCAL YEAR 2013 ⎟ SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

SUMMARY OF FINANCIAL STATEMENT AUDIT FOR FY 2013

Audit Opinion – Unqualified Restatement – No Material Weaknesses – No

SUMMARY OF MANAGEMENT ASSURANCES FOR FY 2013

Effectiveness of Internal Control over Financial Reporting and Operations (FMFIA § 2) 

Statement of Assurance – Unqualified Material Weaknesses – No

Conformance with Financial Management System Requirements (FMFIA § 4) 

Statement of Assurance – Systems Conform to Requirements Nonconformance – No

Compliance with Federal Financial Management Improvement Act (FFMIA)

Agency Auditor 

Systems Requirements, 

Accounting Standards, and 

United States Standard General 

Ledger at Transaction Level

No noncompliance noted No noncompliance noted

** For the complete Summary of Financial Statement Audit and Management Assurances, see page 127 of the FY 2013 

Performance and Accountability Report. This report can be accessed on the NRC Web site at 

http://www.nrc.gov/reading-rm/doc-collections/nuregs/staff/sr1542/.

SUMMARY OF FINANCIAL STATEMENT AUDIT AND

MANAGEMENT ASSURANCES**
Protecting People and the Environment ⎟ http://www.nrc.gov ⎟ 33

NRC Reference Materials

As of November 1999, you may electronically access 

NUREG-series publications and other NRC records at 

the NRC Library at http://www.nrc.gov/reading-rm.

html.

Publicly released records include, to name a few, 

NUREG-series publications; Federal Register 

notices; applicant, licensee, and vendor documents 

and correspondence; NRC correspondence and 

internal memoranda; bulletins and information 

notices; inspection and investigative reports; licensee 

event reports; and Commission papers and their 

attachments.

NRC publications in the NUREG-series, NRC 

regulations, and Title 10, “Energy,” of the Code of 

Federal Regulations may also be purchased from one 

of these two sources.

1. The Superintendent of Documents

U.S. Government Printing Office

Mail Stop SSOP

Washington, DC 20402-0001

Internet: bookstore.gpo.gov

Telephone: 202-512-1800

Fax: 202-512-2250

2. The National Technical Information Service

Springfield, VA 22161-0002

www.ntis.gov

1-800-553-6847 or, locally, 703-605-6000

A single copy of each NRC draft report for comment 

is available free, to the extent of supply, upon written 

request as follows:

Address: Office of Administration,

Publications Branch

U.S. Nuclear Regulatory Commission

Washington, DC 20555-0001

E-mail: DISTRIBUTION.Resource@nrc.gov

Facsimile: 301-415-2289

Some publications in the NUREG-series that are 

posted on the NRC’s Web site at http://www.nrc.

gov/reading-rm/doc-collections/nuregs are updated 

periodically and may differ from the last printed 

version. Although references to material found on a 

Web site bear the date the material was accessed, the 

material available on the date cited may subsequently 

be removed from the site.

Non-NRC Reference Material

Documents available from public and special 

technical libraries include all open literature items, 

such as books, journal articles, and translations, 

Federal Register notices, Federal and State legislation, 

and congressional reports. Such documents as theses, 

dissertations, foreign reports and translations, and 

non-NRC conference proceedings may be purchased 

from their sponsoring organization.

Copies of industry codes and standards used in a 

substantive manner in the NRC regulatory process are 

maintained at–

The NRC Technical Library

Two White Flint North

11545 Rockville Pike

Rockville, MD 20852-2738

These standards are available in the library for 

reference use by the public. Codes and standards 

are usually copyrighted and may be purchased from 

the originating organization or, if they are American 

National Standards, from–

American National Standards Institute

11 West 42nd Street

New York, NY 10036-8002

www.ansi.org

212-642-4900

Legally binding regulatory requirements are stated 

only in laws; NRC regulations; licenses, including 

technical specifications; or orders, not in NUREGseries publications. The views expressed in 

contractor- prepared publications in this series are 

not necessarily those of the NRC.

The NUREG-series comprises (1) technical and 

administrative reports and books prepared by 

the staff (NUREG–XXXX) or agency contractors 

(NUREG/CR–XXXX), (2) proceedings of 

conferences (NUREG/CP–XXXX), (3) reports 

resulting from international agreements (NUREG/

IA–XXXX), (4) brochures (NUREG/BR–XXXX), 

and (5) compilations of legal decisions and orders of 

the Commission and Atomic and Safety Licensing 

Boards and of Directors’ decisions under 10 CFR 

2.206, “Requests for Action under the Subpart” of 

the NRC’s regulations (NUREG-0750).

AVAILABILITY OF REFERENCE MATERIALS IN NRC 

PUBLICATIONS

NRC FORM 335

(9-2004)

NRCMD 3.7

1. REPORT NUMBER

(Assigned by NRC, Add Vol., Supp., Rev.,

and Addendum Numbers, if any.)

2. TITLE AND SUBTITLE 3. DATE REPORT PUBLISHED

MONTH YEAR

4. FIN OR GRANT NUMBER

5. AUTHOR(S) 6. TYPE OF REPORT

7. PERIOD COVERED

8. PERFORMING ORGANIZATION - NAME AND ADDRESS (If NRC, provide Division, Office or Region, U. S. Nuclear Regulatory Commission, and mailing address; if contractor,

 provide name and mailing address)

9. SPONSORING ORGANIZATION - NAME AND ADDRESS (If NRC, type “Same as above”, if contractor, provide NRC Division, Office or Region, U.S. Nuclear Regulatory Commission, 

 and mailing address)

10. SUPPLEMENTARY NOTES

11. ABSTRACT (200 words or less)

12. KEY WORDS/DESCRIPTORS (List words or phrases that will assist researchers in locating the report) 13. AVAILABILITY STATEMENT

14. SECURITY CLASSIFICATION

(This Page)

(This Report)

15. NUMBER OF PAGES

16. PRICE

BIBLIOGRAPHIC DATA SHEET

(See instructions on the reverse)

March

N/A

Annual

Fiscal Year 2013

Unlimited

NUREG-1542, Vol. 19, Supp. 1

U.S. Nuclear Regulatory Commission

Fiscal Year 2013

Summary of Performance and Financial Information

Performance and Accountability Report (PAR)

Fiscal Year (FY)

2013

The Fiscal Year 2013 NRC Summary of Performance and Financial Information provides performance results and 

condensed audited financial statements that enable the Congress, the President, and the public to assess the 

performance of the agency in achieving its mission and stewardship of its resources.

David Holley, James Coyle, et. al

Same as above

NRC FORM 335 (9-2004) PRINTED ON RECYCLED PAPER

2014

Division of Planning and Budget

Office of the Chief Financial Officer

U.S. Nuclear Regulatory Commission

Washington, DC 20555-0001




NUREG-1542, Vol. 19, Supp. 1

March 2014

U.S. NUCLEAR REGULATORY COMMISSION

WASHINGTON, DC 20555-0001

http://www.nrc.gov