**Updates to Federal Employees’ Compensation Act (Workers’ Compensation)**

**GUIDE FOR BASIC ACCOUNTING AND REPORTING**

**Updates to Federal Employees’ Compensation Act (Workers’ Compensation)**

**Effective Date: Fiscal year 2013**

Note: The update to FECA implementation guidance was prepared in GTAS implementation test environment.  

GTAS implementation date is effective for fiscal 2014.  If you have 2013 reporting questions related 

to this guidance, please contact USSGL Advisory Division

**Prepared by:**

**UNITED STATES STANDARD GENERAL LEDGER ADVISORY DIVISION**

**GOVENRMENTWIDE ACCOUNTING**

**BUREAU OF THE FISCAL SERVICE**

**U.S. DEPARTMENT OF TREASURY**

**Note:**This scenario follow USSGL TFM S2-12-03 (July 2012), Part 2 Fiscal 2013 crosswalks, and Part 3 “GTAS Implementation Testing” Fiscal 2014 format of USSGL accounts and attributes.****

**USSGL Proprietary and Budgetary Account Attribute Table**

# USSGL Proprietary and Budgetary Account Attribute Table - Continue

# Crosswalk Impact

**Background:**

Federal Employees’ Compensation Act (FECA) is administered by the Department of Labor (DOL), Office of Workers’ Compensation Programs (OWCP).  FECA provides income and medical cost protection worldwide for job-related injuries, diseases, or deaths of civilian employees of the Federal Government through a special benefit fund called the Federal Employees' Compensation Fund.  The Employees Compensation Fund consists of reimbursements for benefits from insured worker’s employing agencies and annual appropriation from the General Fund of Treasury.

The FECA fund pays benefits on behalf of Federal entities as costs are incurred and bills the entity annually before August 15 for the costs incurred during the **previous**12-month period ended June 30 (July 1 – June 30).  Federal entities fund the FECA payments through appropriations reimbursed to the FECA fund.  For those agencies that have funding though appropriation, each entity shall include in its annual budget estimates for the fiscal year beginning in the next calendar year a request for an appropriation for the amount equal to the costs (approximately 15 months).  Once the appropriation is received, the payments are due to DOL within 30 days.   

There are 4 different types of FECA payment activities:

a.Appropriated Agencies under 2-year cycle 

b.Non-appropriated Agencies 

c.Non-billable agencies 

d.Prepayment by Agency

This guidance will address the most common FECA payment activity, appropriated agencies under 2 year cycle.  The USSGL may provide additional guidance on other FECA payment activities in the future should there be a need. 

**FECA Liability:**

Workers’’ Compensation claims are submitted to, and approved by, the DOL.  DOL pays the claim holders.  DOL then prepares a chargeback billing to the responsible agencies.  Public Law (PL) 93-416, Section 8147 (the FECA law) essentially gives agencies funded by appropriation 2 years to pay the chargeback bill; thereby allowing time for applicable amount to be included in budget submissions.  Therefore, there should be an unfunded liability reported in the agencies’ books for these 2 years (bills are for periods July 1 – June 30), plus an accrual for the 4th quarter of the current FY.  This amount must be split into a current portion for the amount to be paid in the next FY and a non-current portion for the remaining amount.  Pursuant to the FECA law, once funding is received the FECA chargeback bill should be paid within 30 days.  FECA chargeback bills that are still outstanding after the 30-day period are considered delinquent and should be reflected as a funded liability with a footnote disclosure.

**FECA Actuarial Information:**

The FECA Actuarial liability includes the expected liability for death, disability, medical, and other approved costs.  It is estimated using the paid-loss extrapolation method.  This method uses historical benefit payment patterns related to a specific incurred period to predict the entire payments related to that period.  The payments are discounted to present value.

The DOL sends each agencies the actuarial liability estimates for future worker’s compensation benefits amounts for both the current and prior years. The current figure is what the new balance in the Actuarial FECA Liability Account (2650) should be after the source data (DOL information) journal voucher entry is completed by the entity.  This entry represents a change in accounting estimate, and is strictly proprietary, as actuarial liabilities are unfunded.  The expense is determined by comparing the current-year amount to the prior-year amount.

Journal Voucher Entry Support:

The following support must be included with the Actuarial FECA Liability entry:

1. The DOL Memorandum for Chief Financial Officers of Executive Departments and Agencies, which contains the actuarial balances.

2. Agency-Wide Financial Statements Directorate allocation spreadsheet reflecting the percentage allocation to the entity level.

3. A copy of the last three annual chargeback bills for the department level.

**Questions and Answers for****Paying agencies with Permanent Indefinite Authority****.**

**Question:**  Can a paying agency with permanent indefinite budget authority always record a FECA liability as funded?   

**Answer:** No.  Although an agency may have a permanent indefinite appropriation, the Treasury Appropriation Fund Symbol must have budgetary resources available for the FECA obligation as of end of the fiscal year and must be apportioned (if applicable) in order to record a budgetary account payable.   

**Question:**  Can a paying agency with permanent indefinite budget authority record a FECA liability as funded where its Treasury Appropriation Fund Symbol has budgetary resources available for obligation as of the end of the fiscal year but the FECA chargeback bill is budgeted for a subsequent fiscal year? 

**Answer:** No, the paying agency with permanent indefinite budget authority should not record a budgetary account payable with the budgetary resources available for obligation as of the end of the fiscal year.  As of the end of the fiscal year, the FECA liability would be classified as unfunded.  In a future fiscal year, the agency would record the funded FECA liability for the period the FECA chargeback bill was budgeted. 

**Relevant References:**

**Per SFFAS No. 7, FECA transactions are considered exchange revenue.**

**Paragraph 320.****Employer entity payments for unemployment benefits and workers compensation**.-The employer entity recognizes a liability and an expense for Federal employees who are laid-off or injured on the job and are entitled under law to unemployment benefits or workers compensation, respectively. The payment to the former or current employee is made by the unemployment trust fund (Department of Labor) in the case of unemployment benefits and by the special benefits fund (Department of Labor) in the case of workers compensation. Unemployment benefits are reimbursed by the former employer entity; and workers compensation costs are mostly charged back to the employer entity.

**Paragraph 321**. Since the costs are recognized by the employer entity and its payment to the unemployment trust fund or the special benefits fund reimburses these funds for the costs they incur, the amounts these funds receive from the employer entity are exchange revenues.

**OMB Circular A11, section 32.2, How do I treat agency benefit payments under the Federal Employees’ Compensation Act?**

For accounts subject to appropriations action, include in your budget year estimates the amount billed by the Employment Standards Administration (Office of Workers’ Compensation Program) of the Department of Labor for benefits paid on behalf of employees of your agency in the past year under the Federal Employees’ Compensation Act. 

For accounts not subject to appropriations action, you must pay the bill in the current year.

**Assumptions Used in This guidance:**

1) Department of Labor’s 016 1521 is a no year fund. 

2) DOL uses FECA reimbursements from agencies to pay for the FECA claims filed by the injured employees.  DOL will use this resource to pay the FECA claims.  For the purpose of this illustration, assume agency 040’s reimbursement is used to pay agency 30’s employees.  Agency 040 was chosen for illustrative purpose only.   

3) Agency codes 030 and 040 are fictious agency code.  They are used to illustrate partner codes in this guidance. 

4) Assume agency 030 is a newly formed agency and it started its operation in Year X1.

5) Agency 030 receives a chargeback in Year X2 for actual FECA payments made by DOL on behalf of Agency 030 from Jul X1 – June X2.  Assume DOL did not pay FECA claims to agency 030 employees prior to Oct 1, X1(fiscal year X2).

6) To simplify the FECA illustration, agency 030 will not have any other activity recorded except FECA related activities.

7) Assume agency 030 FECA reimbursement to DOL is paid out from a multi year fund which is also mandatory program. 

**New USSGL Accounts**

**Account Title:**Unfunded FECA Benefit Contributions Receivable

**Account Number:**132100

**Account Definition:**The amount recorded by the Department of Labor for unfunded FECA contributions due from Federal employers.  Until the Federal paying agency records the actual budgetary obligation, the associated FECA liability and receivable are considered unfunded.  This account does not close at yearend.

**Normal Balance**: Debit

**Justification:**To assist agencies with interagency reconciliation of benefit programs.

**Account Title:**Unfunded FECA Benefit Revenue

**Account Number:**540500

**Account Definition:**The amount of unfunded FECA accrued revenue recorded by the Department of Labor due from Federal employers.  

**Normal Balance**: Credit

**Justification:**To assist agencies with interagency reconciliation of benefit programs.

**Account Title:**Contra Revenue for****Unfunded FECA Benefit Revenue

**Account Number:**540600

**Account Definition:**The amount reflecting a reduction in unfunded FECA revenue for a benefit program based on adjustments as stipulated by law.

**Normal Balance**: Debit

**Justification:**To assist agencies with interagency reconciliation of benefit programs.

**Changes to Existing Accounts:**

**Account Title:**Funded Employment Benefit Contributions Receivable

**Account Number:**132000

**Normal Balance**: Debit

**Account Definition:**The amount recorded by administering agencies for funded contributions due from Federal employers and/or covered employees for employment related benefits such as retirement, health insurance, life insurance, Federal Employees’ Compensation Act, and unemployment compensation.  This amount excludes Social Security taxes. When the Federal paying agency records the actual budgetary obligation, the associated FECA liability and receivable are considered funded.  This account does not close at yearend.

**Justification:**To assist agencies with inter-agency reconciliation of benefit programs.

**Account Title:**Funded Benefit Program Revenue

**Account Number:**540000

**Normal Balance**: Credit

**Account Definition:**The amount of funded revenue recorded by administering agencies for retirement plans, insurance plans, and other annuities.  

**Justification:**To assist agencies with inter-agency reconciliation of benefit programs.

**New Account Title:** Contra Revenue for Funded Benefit Program Revenue

**Account Number:** 540900

**Normal Balance**: Debit

**Account Definition:** The amount reflecting a reduction in funded revenue for a benefit program based on adjustments as stipulated by law.

**Justification:**To assist agencies with inter-agency reconciliation of benefit programs.

**Listing of USSGL Accounts Used In This Scenario**

**Beginning Trial Balance**

**FECA Calculations Provided by DOL to Agency 030 for 20X2**

**Calculation Table:**

**Year X2**

1)  DOL receives apportionment and allotment for reimbursements from agency 040.  Note: DOL is using reimbursements from prior claims from other agencies to fund the FECA claim for agency 030 employees.  

2) DOL receives FECA reimbursements from agency 040.  Although DOL receives reimbursements from the other Federal agencies on a regular basis, for this illustration purpose the payment from agency 040 will only appear once to show the funding of agency 030’s actual FECA compensation.

3) DOL pays workers’ compensation to employees of agency 030 from Qtr 1, Year 2(10/1/X1-12/31/X1).  Assume this is the first FECA claim payments for agency 030.

4) DOL notifies agency 030 of $60,000 which reflects its workers’ compensation paid out during Qtr 1, Year 2(10/1/X1-12/31/X1).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

5) DOL pays workers’ compensation to employees of agency 030 from Qtr 2, Year 2(01/01/X2-03/31/X2).

6) DOL notifies agency 030 of $70,000 which reflects its workers’ compensation paid out during Qtr 2, Year 2(01/01/X2-03/31/X2).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

7) DOL pays workers’ compensation to employees of agency 030 from Qtr 3, Year 2(04/01/X2-06/30/X2).

8) DOL notifies agency 030 of $40,000 which reflects its workers’ compensation paid out during Qtr 3, Year 2(04/01/X2-06/30/X2).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

9) Before 8/15/X2, the Department of Labor issues first FECA annual chargeback bill (7/1/X1-6/30/x2) to agency 030 for the actual amount of workers’ compensation DOL has paid on behalf of agency 030 from 10/1/X1 to 6/30/X2.  Note: agency 030 did not have any FECA claims paid until 10/1/X1.  Any difference between the actual amount from the annual chargeback and the sum of quarterly chargebacks are adjusted in the following quarter.  Assume for illustration purpose the sum of the quarterly amounts and the annual chargeback amounts are equal.  Approximately after 15 months (fiscal year 20X4), agency 030 receives funding to reimburse DOL.

**Note:** Any agency that identifies a discrepancy on their annual chargeback bill should communicate the need for the adjustment to DOL.  Once the validity of the adjustment is confirmed, DOL will make the correction to its records which will then be reflected on the next Chargeback bill.  No adjusting entries should be made preemptively on the part of the agency; otherwise, the correction will be reflected twice on that agency’s financial statements.

10) DOL pays workers’ compensation claim of $35,000 to agency 030’s employees from Qtr 4, Year 2(7/1/X2-9/30/X2).

11) DOL notifies agency 030 of $35,000 which reflects its workers’ compensation paid out during Qtr 4, Year 2(7/1/X2-9/30/X2).  Any difference between the actual amount from the annual chargeback and the sum of quarterly chargebacks are adjusted in the 4th quarter.  Assume there are no differences for this illustration purpose.  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

12) Agency 030 submits annual budget estimates for the fiscal year beginning in the next calendar year to request for an appropriation for unfunded FECA cost.

13) Department of Labor provides FECA actuarial liability to agency 030. This entry is made at the Fiscal-Year-end only and there is no budgetary impact.

# PRE-CLOSING TRIAL BALANCE

# YEAR 2

**CLOSING ENTRIES FOR END OF YEAR 2**

**C1. To record the closing of revenue, expense, and other financing source accounts to cumulative results of operations.**

# C2. To record the closing of budgetary resources. 

# C3. To record the closing of unobligated balances to no year funds. 

# C4. To record the closing of paid delivered order to total actual resources. 

# POST-CLOSING TRIAL BALANCE

# YEAR 2

###### BALANCE SHEET

**YEAR 2**

**Agency 030DOL(016)**

**Assets**

Intragovernmental

1. Fund Balance with Treasury (101000)495,000

3. Accounts Receivable **(132100E)**0205,000

6. Total Intragovernmental700,000

15. Total Assets   700,000

**Liabilities**

Intragovernmental

19 Other (222500)   205,000

Total Intragovernmental   205,000

Liabilities with Public

24. Federal Employee and Veteran Benefits (265000)3,000,000

28.Total Liabilities3,205,000

**Net Position**

31. Unexpended Appropriation – Other Funds                                                           0

33. Cumulative Results of Operations-Other Funds (640000, 685000,760000)(3,205,000)700,000

34. Total Net Position(3,205,000)700,000

35. Total Liabilities and Net Position            0700,000

**STATEMENT OF NET COST**

**YEAR 2**

Program CostsAgency (030)DOL(016)

Program A:

1. Gross Cost :

 (685000F, 640000N)   205,000205,000

 (760000N)3,000,000

2. Less: Earned Income(540500E)              0 205,000        

3. Net Program Costs3,205,000           0

5. Net Program Costs Including Assumption Changes3,205,000           0

6.Costs Not Assigned to Programs

7.Less: Earned Revenues Not Attributable to Programs

8.Net Cost of Operations 3,205,0000 

###### USSGL 2108 YEAR-END CLOSING STATEMENT

**YEAR 2**

Agency (030)DOL(016)

Column 5 (101000E)                 0495,000

Column 11 (461000E)                 0495,000

**Statement of Changes In Net Position**

**YEAR 2**

**Cumulative Results of OperationsAgency (030)DOL(016)**

1. Beginning Balance0700,000

2. Adjustments

3. Beginning Balances, as Adjusted0700,000

**Budgetary Financing Sources**

4. Other Adjustments

5. Appropriations Used    

6. Nonexchange Revenue

7. Donations and Forfeitures

8. Transfers in/out without reimbursements      

9. Other

**Other Financing Sources:**

10. Donations and Forfeitures

13. Other (599400) 

14. Total Financing Sources                0

15. Net Cost of Operations(3,205,000)          0

16. Net Change(3,205,000)          0

17. Cumulative Results of Operations(3,205,000)          0

**Unexpended Appropriations**

18. Beginning Balance             0          0

19. Adjustments

20. Beginning Balance, as adjusted             0          0

**Budgetary Financing Sources**

21. Appropriations Received (310100)             0          0

22. Appropriations Transferred in/out

23. Other Adjustments

24. Appropriations Used (310700)             0          0

25. Total Budgetary Financing Sources                            0          0

26. Total Unexpended Appropriations                    0          0

27. Net Position(3,205,000)700,000

**SF133: REPORTING ON BUDGET EXECUTIONS AND BUDGETARY RESOURCES**

**AND BUDGET PROGRAM & FINANCING (P&F) SCHEDULE**

**YEAR 2**

**FECA Calculations Provided by DOL for 20X3**

**Calculation Table:**

**Year 3**

1) DOL receives apportionment and allotment on unobligated balance carried forward from PY. Assume it is available for obligation.

2) DOL pays workers’ compensation to employees of agency 030 from Qtr 1, Year 3(10/1/X2-12/31/X2).

3) DOL notifies agency 030 of $45,000 which reflects its workers’ compensation paid out during Qtr 1, Year 3(10/1/X2-12/31/X2).

  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

4) DOL pays workers’ compensation to employees of agency 030 from Qtr 2, Year 3(01/01/X3-03/31/X3).

5) DOL notifies agency 030 of $60,000 which reflects its workers’ compensation paid out during Qtr 2, Year 3(01/01/X3-03/31/X3).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

6) DOL pays workers’ compensation to employees of agency 030 from Qtr 3, Year 3(04/01/X3-06/30/X3).

7) DOL notifies agency 030 of $50,000 which reflects its workers’ compensation paid out during Qtr 3, Year 3(04/01/X3-06/30/X3).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

8) Before 8/15/X3, the Department of Labor issues FECA annual chargeback bill (7/1/X2-6/30/X3) to agency 030 for the actual amount of workers’ compensation DOL has paid on behalf of agency 030 from 7/1/X2-6/30/X3.  No accounting entry is needed when the annual chargeback is sent to the agencies. Both Agency 030 and DOL have already recorded their unfunded liability/receivable and unfunded expense/revenue when the quarterly chargebacks were sent at each quarter. Any difference between the actual amount from the annual chargeback and the sum of quarterly chargebacks are adjusted in the following quarter.  Assume for illustration purpose the sum of the quarterly amounts and the annual chargeback amounts are equal.  Approximately after 15 months (fiscal year 20X5), agency 030 receives funding to reimburse DOL.

**Note:** Any agency that identifies a discrepancy on their chargeback bill should communicate the need for the adjustment to DOL.  Once the validity of the adjustment is confirmed, DOL will make the correction to its records which will then be reflected on the next Chargeback bill.  No adjusting entries should be made preemptively on the part of the agency; otherwise, the correction will be reflected twice on that agency’s financial statements.

9) DOL pays workers’ compensation claim of $55,000 to agency 030’s employees from Qtr 4, Year 3(7/1/X3-9/30/X3).

10) DOL notifies agency 030 of $55,000 which reflects its workers’ compensation paid out during Qtr 4, Year 3(7/1/X3-9/30/X3).  Any difference between the actual amount from the annual chargeback and the sum of quarterly chargebacks are adjusted in the 4th quarter.  Assume there are no differences.  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

11) Agency 030 submits annual budget estimates for the fiscal year beginning in the next calendar year to request for an appropriation for unfunded FECA cost.

12) Department of Labor provides FECA actuarial liability to agency 030. This entry is made at the Fiscal-Year-end only and there is no budgetary impact.

# PRE-CLOSING TRIAL BALANCE

# YEAR 3

**CLOSING ENTRIES FOR END OF YEAR 3**

**C1. To record the closing of revenue, expense, and other financing source accounts to cumulative results of operations.**

# C2. To record the closing of unobligated balance to no year funds. 

# C3. To record the closing of paid delivered orders to total actual resources. 

# POST-CLOSING TRIAL BALANCE

# YEAR 3

###### BALANCE SHEET

**YEAR 3**

**Agency (030)DOL(016)**

**Assets**

Intragovernmental

1. Fund Balance With Treasury (101000) 285,000

3. Accounts Receivable  (132100E)0 415,000

6. Total Intragovernmental  700,000

15. Total Assets             0  700,000

**Liabilities**

Intragovernmental

17 Accounts Payable (222500E)       415,000

20 Total Intragovernmental   415,000

Liabilities with Public

24. Federal Employee and Veteran Benefits (265000)5,500,000

28 Total Liabilities5,915,000

**Net Position**

31. Unexpended Appropriation – Other Funds  0        0

33. Cumulative Results of Operations-Other Funds(6400000,685000,760000)(5,915,000) 700,000

34. Total Net Position(5,915,000)  700,000

35. Total Liabilities and Net Position             0700,000

**STATEMENT OF NET COST**

**YEAR 3**

Program CostsAgency (030)DOL(016)

Program A:

1. Gross Cost :

 (685000E, 640000N)  210,000210,000

 (760000E)2,500,000

2. Less: Earned Income(540500E)             0   (210,000)      

3. Net Program Costs2,710,000            0

5.Net Program Costs including Assumption Changes:2,710,000            0

6.Costs Not Assigned to Programs(685000,640000)               

7.Less: Earned Revenues Not Attributable to Programs

8.Net Cost of Operations2,710,0000

###### USSGL 2108 YEAR-END CLOSING STATEMENT

**YEAR 3**

Agency (030)DOL(016)

Column 5 (101000E)               0285,000

Column 11 (461000E)               0285,000

**Statement of Changes In Net Position**

**YEAR 3**

**Cumulative Results of OperationsAgency (030)DOL(016)**

1. Beginning Balance(3,205,000)700,000

2. Adjustments

3. Beginning Balances, as Adjusted(3,205,000)700,000

**Budgetary Financing Sources**

4. Other Adjustments

5. Appropriations Used  0    

6. Nonexchange Revenue

9. Other

**Other Financing Sources:**

12. Imputed Financing

13. Other  

14. Total Financing Sources      

15. Net Cost of Operations(2,710,000 )  0

16. Net Change(2,710,000)

17. Cumulative Results of Operations(5,915,000)700,000

**Unexpended Appropriations**

18. Beginning Balance0 

19. Adjustments

20. Beginning Balance, as adjusted0      

**Budgetary Financing Sources**

21. Appropriations Received (310100)    

22. Appropriations Transferred in/out

23. Other Adjustments

24. Appropriations Used (310700)

25. Total Budgetary Financing Sources             

26. Total Unexpended Appropriations 

27. Net Position(5,915,000) 700,000

**SF133: REPORTING ON BUDGET EXECUTIONS AND BUDGETARY RESOURCES**

**AND BUDGET PROGRAM & FINANCING (P&F) SCHEDULE**

**YEAR 3**

**FECA Calculations Provided by DOL for 20X4**

**Calculation Table:**

**Year 4**

1) DOL receives apportionment and allotment on unobligated balance carried forward from PY. Assume it is available for obligation.

2) DOL anticipates reimbursement from agency 030 for 10/01/X3-09/30/X4.  

3) Agency 030 receives its appropriation and is able to pay FECA chargeback from 7/1/X1 – 6/30/X2, assume Agency 030’s appropriation is apportioned and allotted.  (Pursuant to the FECA law, once funding is received the FECA bill should be paid within 30 days.  FECA bills that are still outstanding after the 30-day period are considered delinquent and should be reflected as a funded liability with a footnote disclosure.)

4) To reclassify unfunded liability and expense to funded liability and expense.  At this time, the DOL will record a budgetary federal receivable from agency 030. When a unfunded proprietary receivable was recorded by DOL, the paying account did not have budgetary resource to record an obligation to DOL, therefore, DOL should not record a budgetary receivable until the paying account records obligations to DOL (see OMB A11 section 20.4). 

5) Agency 030 makes the payments to DOL from 7/1/X1 – 6/30/X2.  

6) DOL pays workers’ compensation to employees of agency 030 from Qtr 1, Year 4(10/1/X3-12/31/X3).

7) DOL notifies agency 030 of $50,000 which reflects its workers’ compensation paid out during Qtr 1, Year 4(10/1/X3-12/31/X3).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

8) DOL pays workers’ compensation to employees of agency 030 from Qtr 2, Year 4(01/01/X4-03/31/X4).

9 DOL notifies agency 030 of $65,000 which reflects its workers’ compensation paid out during Qtr 2, Year 4(01/01/X4-03/31/X4).  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

10) DOL pays workers’ compensation to employees of agency 030 from Qtr 3, Year 4(04/01/X4-06/30/X4).

11) DOL notifies agency 030 of $80,000 which reflects its workers’ compensation paid out during Qtr 3, Year 4(04/01/X4-06/30/X4)..  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

12) Before 8/15/X4, the Department of Labor issues FECA annual chargeback bill (7/1/X3-6/30/X4) to agency 030 for the actual amount of workers’ compensation DOL has paid on behalf of agency 030 from 7/1/X3 to 6/30/X4.  No accounting entry is needed when the annual chargeback is sent to the agencies. Both Agency 030 and DOL have already recorded their unfunded liability/receivable and unfunded expense/revenue when the quarterly chargebacks were sent at each quarter. Any difference between the actual amount from the annual chargeback and the sum of quarterly chargebacks are adjusted in the following quarter.  Assume for illustration purpose the sum of the quarterly amounts and the annual chargeback amounts are equal.  Approximately after 15 months (fiscal year 20X6), agency 030 receives funding to reimburse DOL.

**Note:** Any agency that identifies a discrepancy on their chargeback bill should communicate the need for the adjustment to DOL.  Once the validity of the adjustment is confirmed, DOL will make the correction to its records which will then be reflected on the next Chargeback bill.  No adjusting entries should be made preemptively on the part of the agency; otherwise, the correction will be reflected twice on that agency’s financial statements.

13) DOL pays workers’ compensation claim of $45,000 to agency 030’s employees from Qtr 4, Year 4(7/1/X4-9/30/X4).

14) DOL notifies agency 030 of $45,000 which reflects its workers’ compensation paid out during Qtr 4, Year 4(7/1/X4-9/30/X4). Any difference between the actual amount from the annual chargeback and the sum of quarterly chargebacks are adjusted in the 4th quarter.  Assume there are no differences.  DOL records unfunded FECA receivable and FECA revenue and agency 030 records unfunded FECA liability and FECA expense.  

15) Agency 030 submits annual budget estimates for the fiscal year beginning in the next calendar year to request for an appropriation for unfunded FECA cost.

16) Department of Labor provides FECA actuarial liability to agency 030. This entry is made at the Fiscal-Year-end only and there is no budgetary impact.

**PRE-CLOSING TRIAL BALANCE**

# YEAR 4

**CLOSING ENTRIES FOR END OF YEAR 4**

**C1. To record the closing of revenue, expense, and other financing source accounts to cumulative results of operations.**

# C2. To record the closing of budgetary resources. 

# C3. To record the closing of paid undelivered orders to total actual resources. 

# C4. To record the closing of unobligated balance to no year fund.

# C5. To record the closing of fiscal year activities to unexpended appropriation.

# POST-CLOSING TRIAL BALANCE

# YEAR 4

###### BALANCE SHEET

**YEAR 4**

**Agency (030)DOL(016)**

**Assets**

Intragovernmental

1. Fund Balance with Treasury (101000)215,000

3. Accounts Receivable  (132100E)0485,000

6. Total Intragovernmental700,000

15. Total Assets   700,000

**Liabilities**

Intragovernmental

17 Accounts Payable        0

19. Other (221500,222500)    485,000

20. Total Intragovernmental    485,000

Liabilities with Public

24. Federal Employee and Veteran Benefits (265000)8,200,000

28. Total Liabilities8,685,000

**Net Position**

31. Unexpended Appropriation – Other Funds (310000E)0     

33. Cumulative Results of Operations-Other Funds (331000E)(8,685,000)700,000

34. Total Net Position(8,685,000)700,000

35. Total Liabilities and Net Position0700,000

**STATEMENT OF NET COST**

**YEAR 4**

Program CostsAgency (030)DOL(016)

Program A:

1. Gross Cost :

 (685000E, 640000N)   240,000240,000

 (760000E)2,700,000

2. Less: Earned Income(540000E, 540500E)(240,000)         

3. Net Program Costs2,940,0000

5. Net Program Costs Including Assumption Changes0            0

6.Costs Not Assigned to Programs0            0

7.Less: Earned Revenues Not Attributable to Programs

8.Net Cost of Operations2,940,000             0

###### USSGL 2108 YEAR-END CLOSING STATEMENT

**YEAR 4**

Agency (030)DOL(016)

Column 5 (101000E)0215,000

Column 11 (461000E)0215,000

**Statement of Changes In Net Position**

**YEAR 4**

**Cumulative Results of OperationsAgency (030)DOL(016)**

1. Beginning Balance(5,915,000)700,000

2. Adjustments

3. Beginning Balances, as Adjusted(5,915,000)700,000

**Budgetary Financing Sources**

4. Other Adjustments

5. Appropriations Used (570000)170,000     

6. Nonexchange Revenue

7. Donations and Forfeitures

8. Transfers in/out without reimbursements      

9. Other

**Other Financing Sources:**

13. Other (599400) 

14. Total Financing Sources170,000      0

15. Net Cost of Operations(2,940,000)0

16. Net Change(2,770,000)0

17. Cumulative Results of Operations(8,685,000)700,000

**Unexpended Appropriations**

18. Beginning Balance00

19. Adjustments

20. Beginning Balance, as adjusted00

**Budgetary Financing Sources**

21. Appropriations Received (310100)    170,0000

22. Appropriations Transferred in/out                                                                         

23. Other Adjustments

24. Appropriations Used (310700)                                                                            (170,000)                                                   0

25. Total Budgetary Financing Sources00       

26. Total Unexpended Appropriations                             00

27. Net Position(8,685,000)700,000

**SF133: REPORTING ON BUDGET EXECUTIONS AND BUDGETARY RESOURCES**

**AND BUDGET PROGRAM & FINANCING (P&F) SCHEDULE**

**YEAR 4**

**Appendix:**

             TITLE 5--GOVERNMENT ORGANIZATION AND EMPLOYEES

                           PART III--EMPLOYEES

                   Subpart G--Insurance and Annuities

               CHAPTER 81--COMPENSATION FOR WORK INJURIES

                         SUBCHAPTER I--GENERALLY

Sec. 8147. Employees' Compensation Fund

 (a) There is in the Treasury of the United States the Employees' Compensation Fund which consists of sums that Congress, from time to time, may appropriate for or transfer to it, and amounts that otherwise accrue to it under this subchapter or other statute. The Fund is available without time limit for the payment of compensation and other benefits and expenses, except administrative expenses, authorized by this subchapter or any extension or application thereof, except as otherwise provided by this subchapter or other statute. The Secretary of Labor shall submit annually to the Office of Management and Budget estimates of appropriations necessary for the maintenance of the Fund. For the purpose of this subsection, ``administrative expenses'' does not include expenses for legal services performed by or for the Secretary under sections 8131 and 8132 of this title.

 (b) Before August 15 of each year, the Secretary shall furnish to each agency and instrumentality of the United States having an employee who is or may be entitled to compensation benefits under this subchapter or any extension or application thereof a statement showing the total cost of benefits and other payments made from the Employees' Compensation Fund during the preceding July 1 through June 30 expense period on account of the injury or death of employees or individuals under the jurisdiction of the agency or instrumentality. Each agency and instrumentality shall include in its annual budget estimates for the fiscal year beginning in the next calendar year a request for an appropriation in an amount equal to the costs. Sums appropriated pursuant to the request shall be deposited in the Treasury to the credit of the Fund within 30 days after they are available. An agency or instrumentality not dependent on an annual appropriation shall make the deposit required by this subsection from funds under its control during the first fifteen days of October following the furnishing of the statement. If an agency or instrumentality (or part or function thereof) is transferred to another agency or instrumentality, the cost of compensation benefits and other expenses paid from the Fund on account of the injury or death of employees of the transferred agency or instrumentality (or part or function) shall be included in costs of the receiving agency or instrumentality.

(c) In addition to the contributions for the maintenance of the Employees' Compensation Fund required by this section, the United States Postal Service, or a mixed ownership corporation as defined by section 9101(2) of title 31, or any other corporation or agency or instrumentality (or activity thereof) which is required by statute to submit an annual budget pursuant to or as provided by chapter 91 of title 31, shall pay an additional amount for its fair share of the cost of administration of this subchapter as determined by the Secretary. With respect to these corporations, agencies, and instrumentalities, the charges billed by the Secretary under this section shall include an additional amount for these costs, which shall be paid into the Treasury as miscellaneous receipts from the sources authorized and in the manner otherwise provided by this section.

� Refer to TFM S2-12-03(July 2012), Part 2, Section IV for a listing of domain values.

� Asterisk indicates a particular attribute does not apply to the specific USSGL account.

� Fiscal 2013 reclassified statements are not yet available.  It is possible for the line numbers on the reclassified crosswalks to change at that time.

� See Illustration 1 for sample journal entry to record Unfunded FECA liability

� If there is an increase in FECA actuarial liability, debit USSGL account 7600 and credit USSGL account 2650.  Reverse the entry if there is a decrease in the FECA actuarial liability.

� DOL notifies the agencies by providing them with the quarterly chargebacks.

� From an agency or fund perspective, the accrued unfunded FECA liability is the difference between the FECA benefits paid by the FECA Special Benefits Fund and the agency's actual cash payment to the Fund. For example, the Special Benefits Fund will pay benefits on behalf of an agency or fund through the current year. However, most agencies' actual cash payments to the FECA Special Benefit Fund for the current FY will reimburse the Fund for benefits paid through a prior fiscal year. The difference between these two amounts -- benefits paid by the Fund and reimbursements made by the agencies -- is the accrued unfunded liability.

� OMB A11 20.4

Changes in uncollected customer payments from Federal sources.  You need to adjust the spending authority from cash collections if the account is authorized to perform reimbursable work for another Federal account and you incur obligations against receivables from Federal sources and unfilled customer orders from Federal sources without an advance—that is, before receiving the cash.  The law allows you to incur such obligations as long as the paying account is a Federal account and an obligation is recorded against resources available to the paying account.  For example, a financing account can obligate against a subsidy accounts receivable from the program account before the cash is received from the program account if the program account has recorded an obligation in the form of a subsidy accounts payable to the financing account.

� The FECA actuarial liability includes the expected liability for death, disability, medical, and other approved costs. It is estimated using the paid-loss extrapolation method. This method uses historical benefit payment patterns related to a specific incurred period to predict the entire payments related to that period. The payments are discounted to present value.

� This is the first year that agency 030 is in operation; therefore there is no prior year FECA actuarial liability recorded.  The change will be Ending-Beginning(0)

� When the agencies receive appropriations to pay DOL for the accrued FECA costs, the unfunded FECA liability and unfunded expense should be reclassified to funded liability and benefit expense.

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