-, 

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Consolidated ·Financial · 

s·tatements of the .. ') 

United States Government 

. - ' -·, '• ..... - ;; . - ... '. ... ' . .)--

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./ 

. PROTOTYPE 
r 

v 

Advisory Committee on Federal Consolidated 

Financial Statements 

The advisory committee provides advice on a number of issues confronting the 

Department of the Treasury in its preparation of consolidated financial statements for 

the U.S. Government. The committee has over the past two years considered many 

technical issues, among them objectives to be served by the statements, format of the 

statements, accounting and reporting for pensions, commitments, and contingencies, 

valuation of assets, depreciation methods, accruing federal tax revenues and inflation 

· accounting. The committee members' views have beer, carefully considered in developing 

this prototype report and will be considered in developing subsequent publications of these 

Statements. The Treasury acknowledges the support and continuing assistance from the 

advisory committee: 

Mr. Harvey Kapnick, CPA 

Dr. Wilton Anderson, CPA 

Mr. John Biegler,, CPA 

Mr. Ivan Bull, CPA 

Dr. Joe J. Cramer, Jr:., CPA 

Mr. Nathan Cutler 

.Dr .. Sidney Davidson, CPA 

Chairman, Arthur Andersen & Co. 

Chairman of Advisory Committee on Federal Consolidated Financial 

Statements 

Head of Accounting Department, Oklahoma State University 

Past President of American Accounting Association 

Senior Partner, Price Waterhouse & Co. 

President of the Board of Trustees, Financial Accounting Foundation 

Managing Partner of McGladrey, Hansen, Dunn & Company 

Past Chairman of the Board of American Institute of Certified Public 

. Accountants 

Faculty Resident, Arthur Andersen & Co. 

Professor of Accounting and Arthur Andersen 

Faculty Fellow, The Pennsylvania State University 

Executive Vice President, Association of Government Accountants 

Former Director of Audits, Department of Transportation 

Arthur Young Professor of Accounting and Director of Business 

Research, University of Chicago 

Past President of American Accounting Association 

Mr. Samuel A. Derieux, CPA . 'Partner, Derieux, Baker, Thompson and. Whitt 

Dr. Solomon Fabricant • 

Mr. Gaylord Freeman 

Mrs. Carol Loomis 

Dr. Robert K. Mautz, CPA 

Dr. Charles L. Schultze 

Honorable Elmer B. Staats 

Mrs. Julia M. Walsh 

Dr. George J. Staubus 

Past President of American Institute of Certified Public Accountants 

Member of Senior Research Staff, National Bureau of Economic 

Research 

Former Consultant to General Accounting Office 

Honorary Chairman of the Board, First National Bank of Chicago 

Former Consultant to {he Secretary of the Treasury 

Member of Board of Editors, Fortune Magazine 

Author of the article, "An Annual Report for the Federal Government," 

1973 

Partner, Ernst & Ernst 

Member of Cost Accounting Standards Board 

Chairman, Council of Economic Advisers 

Former Director, Bureau of the Budget (now 0MB) 

Comptroller General of the United States 

Chairman of the Board, Julia M. Walsh & Sons, Inc. 

Director, U.S. Chamber of Commerce 

Director of Research and Technical Activities, Financial Accounting 

Standards Board 

An observer at Committee meetings 
Statement of the Secretary of the Treasury 

Beginning in 1949 with the recommendations of the Commission on Organization 

of the Executive Branch (Hoover Commission), the Federal Government has moved slowly 

but steadily towards the application of ace rual accounting to the measurement of its 

financial operations. State and local governments have also trended in this direction. 

This prototype report is the result of an experimental undertaking aimed at extending 

accrual accounting concepts to new areas of governmental accounting. The undertaking 

is intended to contribute to 

• the improvement of accounting at all levels of government, Federal, state, and 

local; 

• the development of accounting standards for public financial reporting by 

government entities; and 

• the integration of govern.mental accounting standards with accounting standards 

applicable to the private sector. 

This second prototype report should not be regarded as a financial statement in the 

conventional sense, but ra.ther as a step in the evolution of comprehensive and , 

understandable government financial reporting. It has not been prepared in accordance 

with any set of generally accepted accounting principles, as there are none for the 

U.S. Government. As the Comptroller General points out in his accompanying statement, 

there are a number of significant controversial issues that must be resolved before 

statements of this type can be certified. There is also disagreement among the members 

of the Advisory Committee on Federal Consolidated Financial Statements, Government officials responsible for accounting matters, and others as to how these issues should be resolved and also as to various portions of ·this prototype. Hence, the report should be recogni_zed only for what it is-a preliminary approach to the complex and controversial task of 

presenting accurate and understandable information about the financial condition of the 

Government. It is not the Government's report on its financial condition and it should not be· 

so interpreted. 

This second prototype has bee·n revised in major respects based upon recommendations of the advisory committee (listed inside the front cover) and reactions of the 

general public to the first prototype report published in late 1976. The basic statements 

of financial condition and operations have been delineated more fully. A number of 

supplemental schedules have been added to amplify various aspects of the Government's 

financial operations that are not captured in the basic statements. Both the basic 

statements and the supplemental schedules, however, are embryonic. Many conceptual and 

methodological issues must be resolved before reports such as this prototype can be 

represented as conforming to generally accepted accounting principles. 

For example, among any national government's principal assets are its powers to 

tax and to create money. These are not represented among the assets in this prototype 

report. The outer continental shelf and some 704 million acres of public domain lands are 

likewise not included among the assets in this report; however, proposals have been made 

for valuing these lands for inclusion in future financial statements. How to carry these 

assets on a balance sheet will not be an easy issue to resolve. 

1 
On the liability side, much debate centers on the liability for accrued social security 

pensions. Some contend that social security benefits are current transfers of income and 

that no liability for future payments should be shown. Others contend that the full actuarial 

deficit-the difference between projected receipts and payments over the next 75 yearsshould be shown as a liability. This report continues, in modified form, the practice used 

in the first prototype of showing an amortized portion of the actuarial deficit. However, this 

is clearly not the appropriate final resolution of the issue; it needs further study and this 

.will .be done in t~e coming months. 

Despite these and other conceptual issues and data deficiencies that are not yet 

resolved, it is ·important that govern·ments press forward with the development of better 

financial measurement and reporting. Combined Federal, state, and local expenditures in 

1976 amounted to 34 percent of the gross national product. Government borrowings in 

1976 accounted for 40 percent of the new issues in the capital markets. Financial 

operations of this magnitude require more sophisticated accounting techniques than 

traditional governmental fund accounting provides. 

The focus of governmental accounting traditionally has been on preventing overspending of appropriations. That is an essential purpose, but it is much too narrow for the 

large and complex institutions that governments have' become. The focus of governmental 

accounting must be shifted to broader purposes-on facilitating better management of 

government programs and government finances and on enhancing public understanding 

of resources used in the conduct of government operations. Through the exploration of 

new accounting concepts, the adaptation of old concepts, and the exposure to the public 

of various accounting applications, this and subsequent reports can contribute to achieving 

those broader purposes. 

During the past year, the advisory committee met to consider a number of issues and 

staff reports dealing with the shape and content of this report. The advisory committee 

members faced an unusually difficult task in that the problems with which they were 

confronted were many of the same fundamental issues the accounting profession has been 

actively debating, and because those problems had to be dealt with in a governmental 

· context, something that had not been done before. 

To date, the advisory committee, the General Accounting Office, and the Treasury 

have given primary attention to identifying the highest priority problems which need to be 

· solved if_ governmental accounting is to be brougtit up to the level of the private sector. 

The complexity of the task is illustrated by a chart appearing at the end of this report on 

the valuation of assets .. One of the advisory committee's recommendations was that assets 

be valued at their current values. The chart shows the wide gap that must be bridged 

before this can be accomplished. 

As with the first prototype, we seek the reactions and comments of readers of this 

financial report. 

2 

W. MICHAEL BLUMENTHAL 

Secretary of the Treasury 

July 26, 1977 
Statement of the Comptroller General of the 

United States 

In commenting on an initial prototype report last year, we noted the need to make this 

report more comprehensive by providing information on the full range of Government 

activities. Significant progress has been made _in the design and development of information that supplements the traditional statements. However, as with the first report, we 

must caution that this report must be considered preliminary and that before fully 

satisfactory financial statements can be prepared, many aspects of presenting information 

and determining appropriate amounts for assets and liabilities will require further study. 

For example, such controversial issues as the following must be resolved: 

• The basis for valuation of such diversified Federal assets as the public domain, defense weapon systems, and natural resources must be changed. In the attached 

statements, these assets are valued at cost. We agree with the preference 

expressed by the Advisory Committee on Federal Consolidated Financial 

Statements that Federal assets should be recorded and reported on a current 

value basis. Further study will be necessary to select the most appropriate 

current value method for each category of Federal asset and to determine the 

best source of the data needed to make the valuations. 

• The fair presentation of actual liabilities for Federal pension plans, social 

security payments and veterans benefits needs further consideration. Liabilities 

for some Federal pension plans that are not included in these financial statements 

need to be determined. Also, the method of determining the amounts of all these 

liabilities, as well as the method of presenting when payment will be required, 

needs further study. 

• The method of computing depreciation of Federal assets needs to be improved. 

The depreciation amounts used in these statements were based on broad 

calculations. Refinement of the methods used is desirable. 

• The effect of tax benefits on revenues needs further study. In many cases the 

data essential for analyzing the amounts of revenue which the Government has 

not received because of exemptions or deductions authorized by tax law is 

insufficient. Additional work is needed to improve the accuracy and scope of 

these computations. 

• The cost to the Government of interest subsidies on outstanding Government 

loans needs to be computed more precisely. The data currently available on 

interest subsidies represent only a very rough approximation of the costs of 

these subsidies to the Government. Efforts should be made to refine these data 

so that more accurate costs can be shown. 

• The time span of the Flow of Funds Statement should be increased. This Statement predicts cash basis revenues and expenditures in future years using certain 

basic assumptions reflected in the Federal budget. We believe this Statement 

should be expanded to cover at least a fifteen year period with information 

for each year provided in ranges which take into consideration varying economic 

conditions. 

3 
We have not examined or audited these statements. Such an audit would be 

impractical because these statements are of a preliminary nature and several difficult 

problems such as those described above remain to be resolved. Accordingly, we are not 

expressing an opinion on whether they fairly present the financial condition and results of 

Government operations for the periods of time they cover. We believe, however, that 

these preliminary statements will serve to highlight some of the critical financial 

problems that the Federal Government faces and will encourage more comprehensive 

financial reporting by government entities at all levels. 

4 

ELMER B .. STAATS 

Comptroller General of the United States 

June 15, 1977 
Consolidated Financial Statements 
United States Government 

.Consolidated Statement of Financial Position 

as of September 30, 1976, and June 30, 1976 and 1975 

(amounts in billions) 

Assets 

(What the Government owns-resources that· are available 

to pay obligations or to provide public services in the future) 

1976 1975 

Sept. 30 June 30 June 30 

Cash and monetary reserves 

Operating cash in the Treasury ....................... . - $17.4 $14.8 $7.6 

International monetary reserves (Note 1) ....... . 17.9 17.1 16.2 

Other cash ...... .' .............................................. . 6.3 7.1 5.2 

. -- - -------------41.6---39.0---29.0 

Receivables (net of allowances) 

Accounts receivable ....................................... . 5.4 3.9 5.5 

Accrued taxes receivable· (Note 2) ... , ............. . 14.1 10.1 11.8 

Loans receivable (Note 3) ............................ .. 100.2 106.4 82.7 

Advances and prepayments ........................... . 6.7 3.6 1.3 

126.4 124.0 101.3 

Inventories (at cost) (Note 4) 

Goods for sale ............................................... . 13.5 13.2 11.2 

Work in process ............................................. . .8 .8 .7 

Raw materials ............................................... . 1.4 1.6 2.8 

Materials and supplies for Government use ... . 35.4 35.5 31.2 

Stockpiled materials and commodities ........... . 12.5 12.3 11.6 

63.6 63.4 57.5 

Property and equipment (at cost) 

Land (Note 5) ............................................... . 7:6 7.5 7.0 

Buildings, structures, and facilities (Note 6) .... . 92.7 92.5 92.1 

Military hardware (Note 7), ........................... . 133.5 133.5 126.6 

Equi.pment (Note 7) ....................................... . 42.9 42.6 41.1 

Construction in progress ............................... . 16.2 16.6 18.0 

Other ............................................................ .. 1.7 1.8 2.1 

294.6 294.5 286.9 

Accumulated depreciation (Note 8) .............. .. (147.2) (145.1) ( 136.5) 

\ 147.4 149.4 150.4 

Deferred charges and other assets· .............. .. 20.2 18.6 16.7 

Total assets ........................................... . $399.2 $394.4 $354.9 

The accompanying notes are an integral pa.rt of this statement. 

6 
United States Government 

Consolidated Statement of Financial Position 

as of September 30, 1976, and June 30, 1976 and 1975 

(amounts in billions) 

Liabilities 

(What the Government owes-obligations incurred in the 

past that will require cash or other resources in the future) 

1976 1975 

Accounts payable ............................................... . 

- Un~arned revenue ............................................. . 

Borrowings from the public (Note 9) ................. . 

Accrued pensions under retirement and disability 

plans (Note 10) 

Military personnel ........................................ .. 

Civilian employees ............................ -............. . 

Social security ............................................... . 

Veterans ......................................................... . 

Loss reserves for guarantee and insurance 

programs (Note 11) ................................... . 

Other· liabilities ................................................ .. 

Total liabilities ....................................... . 

Fiscal Deficit 

Sept. 30 June 30 June 30 

$53.7 $45.7 $46.9 

9.8 

494.6 

119.3 

133.9 

630.8 

113.4 

997.4 

27.9 

42.5 

1,625.9 

9.5 

476.6 

117.3 

130.9 

603.1 

113.6 

964.9 

25.3 

41.8 

1,563.8 

8.3 

394.4 

96.6 

118.0 

499.5 

117.3 

831.4 

15.1 

39.4 

1,335.5 

(The accumulated amount by which the costs of Government 

activities have exceeded Government revenues) 

Fiscal deficit beginning of period ..................... . 

Current period fiscal deficit ............................... . 

· Current noncash provision for social security 

(Note 12) ................................................... . 

(1,169.4) 

(29.6) 

(27.7) 

(980.6) 

(85.2) 

( 103.6) 

(833.2) 

(63.9) 

(83.5) 

Fiscal deficit end of period ................................ (1,226.7) (1,169.4) (980.6) 

Total liabilities and fiscal deficit ............. . $399.2 $394.4 $354.9 

The accompanying notes are an integral part of this statement. 

7 
United States Government Consolidated Statement of Operations 

for the Transitional Quarter (TQ) ended September 30, 1976, 

and the Years ended June 30, 1976 and 1975 

(amounts in billions) 

Revenues 

Levied under the Government's sovereign power 

Individual income taxes ............................. . 

Corporate income taxes ............................. . 

Social insurance taxes and contributions ... . 

Excise taxes ............................................... . 

Estate and gift taxes ................................... . 

Customs duties .......................................... .. 

Miscellaneous ........................................... . 

Earned through Government business-type 

operations 

Sale of goods and services ......................... . 

Interest .................................................... . 

Other ......................................................... . 

Total revenues ....................................... . 

Expenses by function (see also summary· of expenses by object and agency) 

Agriculture ..................................................... . 

Commerce and transportation ......................... . 

Community and regional development ........... . 

Education, training, employment, and 

social services ....................................... . 

General government .................................... .. 

General science, space and technology ....... : .. 

Health ........................................................... . 

Income security 

Military personnel .................................... .. 

Civilian employees ......................... : .......... .. 

Social insurance .......... : ........................... .. 

Veterans .................................................. .. 

Other ........................................................ .. 

Interest ......................................................... . 

International affairs ...................................... .. 

Law enforcement and justice ......................... . 

National defense ............................................ .. 

Natural resources, environment, and energy ... . 

. Revenue sharing and general purpose fiscal 

assistance ............................................ .. 

Veterans benefits and services ....................... . 

Total expenses ...................................... .. 

Current period fiscal deficit .......... .. 

TQ 

$38.8 

12.5 

25.8 

4.5 

1.5 

1.2 

4.4 

88.7 

5.7 

2.4 

4.0 

12.1 

100.8 ---·-

1.9 

6.3 

3.8 

6.6 

3.2 

1.4 

11.6 

4.8 

5.5 

26.3 

1.6 

9.8 

8.1 

4.3 

1.2 

22.6 

4.9 

2.3 

4.2 

130.4 

$(29.6) 

The accompanying notes are an integral part of this statement. 

8 

1976 ·1975 

June 30 June 30 

$131.6 $122.4 

39.7 37.4 

92.7 86.4 

16.9 16.6 

5.2 4.6 

4.1 3.7 

9.8 9.7 --

300.0 280.8 

14.8 11.8 

16.3 11.9 

17.6 16.8 --

48.7 40.5 -- -- 348.7 321.3 

10.7 14.5 · 

17.6 15.4 

13.4 6.2 

17.9 14.4 

12.2 7.9 

4.3 3.7 

34.1 27.1 

28.1 23.1 

21.2 17.0 

81.7 72.6 

4.7 14.2 

37.5 28.4 

37.1 32.7 

12.0 8.1 

3.4 2.8 

65.6 73.3 

13.6 7.8 

6.7 6.6 

12.1 9.4 

433.9 385.2 -- --- $(85.2) $(63.9) 

-- = 
Summary of Expenses by Object and Agency 

1976 1975 

, Expenses by object TQ June 30 June 30 

Salaries and employee benefits ....................... . $8.3 $67.8 $63.9 

Vendor services and supplies ....................... . 24.1 68.5 67.3 

Depreciation ................................................... . 2.1 8.6 7.7 

Pensions, health and life insurance ................ .. 10.1 57.3 48.8 

Casualty insurance and indemnities ............ .. 35.5 103.0 87.1 

Grants, subsidies, and contributions ............... . 42.2 91.6 77.7 

Interest ........................................................... . 8.1 37.1 32.7 

Total expenses ....................................... . $130.4 $433.9 $385.2 

Expenses by agency 

Legislative Branch ......................................... . $.2 $.8 $.7 

The Judiciary· ................................................ .. .1 .3 .3 

Executive Branch 

Office of the President .............................. .. 4.3 11.5 22.1 

Departments 

Agriculture ............................................. . 5.8 22.1 8.0 

Commerce ..................... : ....................... . .8 2.3 1.7 

Defense ................................................. . 27.8 97.2 96.8 

Health, Education and Welfare ............... . 43.2 132.1 107.9 

Housing and Urban Development ......... . 4.4 15.6 9.7 

.Interior- ................................................. . 1.5 4.2 3.3 

Justice .................................................. .. .8 2.5 2.2 

Labor ..................................................... . 7.7 26.4 17.0 

State .................................................... .. .4 1.2 .9 

Transportation ....................................... . 3.8 12.7v- 9.0 

Treasury: Interest .............................. .. 8.1 37.1 32.7 

Other .................................. .. 3.2 9.8 9.8 

Independent Agencies ............................... . 18.3 58.1 · 63.1 

Total expenses ...................................... .. $130.4 $433.9 $385.2 

The.accompanying notes are an integral part of this statement. 

9 
Introductory Statement to Notes 

As is true of accounting in other types of economic entities governmental accounting 

exists for the purpose of providing complete and accurate financial information, in proper 

form and on a timely basis, to those responsible for and concerned with the operations 

of governmental units and agencies. While the Federal Government presently prepares 

many types of statements for specialized users, these prototype Federal Consolidated 

Financial Statements have been prepared to serve the common needs of a variety of 

users, with emphasis on the general public, to help promote understanding of the overall 

financial condition of the Federal Government and to promote a more informed 

understanding of government's place in our economy. It is important to note that this 

report is a prototype: Many aspects of the financial statements require further analysis. 

Only as the various problems are resolved can fully satisfactory statements be prepared. 

A change in the fiscal year required that amounts be reflected in the Consolidated 

Statement of Financial Position as of September 30, 1976, June 30, 1976, and June 

30, 1975. The revenues and expenses for the three month Transition Quarter (July 1, 1976, 

to September 30, 1976) are shown separately in the Consolidated Statement of 

Operations. 

The sources used in developing the statements were predominantly Treasury 

publications, supplemented by reports from both the civilian and military sectors of 

the Federal Government. For the most part, these publications and reports are a 

product of the agencies' accounting systems, which by law must conform in all material 

respects to the accounting principles, standards, and related requirements prescribed 

by the Comptroller General of the United States. The maintenance of accounts on the 

accrual basis is a basic requirement for all Federal agencies. As of December 31, 1976, 

there were 338 accounting systems subject to approval by the Comptroller General. (The 

Comptroller General has approved the principles and standards of 98 percent of these 

accounting systems and the designs of 52 percent of the systems.) The great majority of 

information in this report is derived from these systems. . . 

The accompanying financial statements include the accounts of all significant agencies 

and funds included in the Unified Budget of the United States Government. Agencies 

such as the U.S. Postal Service, the Export-Import Bank of the United States, and the 

Federal Financing Bank, which are classified as "off-budget" (not included in the budget), 

have also been included in the financial statements because they are wholly owned and 

are clearly within the scope of Government operations. Government-sponsored enterprises 

such as Federal Land Banks have been excluded because they are privately owned. The 

Federal Reserve System is excluded. Although the Government's power to tax and to 

create money may be considered its most important assets, these are not included in 

these statements because the concepts have not been developed to the point where 

valuation is possible. · 

Although the Advisory Committee on Federal Consolidated Financial Statements has 

generally agreed that assets should be shown on a current value basis, the current value 

method best suited for each type of asset has not yet been determined. The Valuation Methods Schedule (page 26) lists various current value methods applicable to each type of 

asset. This is one of the many conceptual as well as practical problems that the Treasury 

has begun to address and must resolve to improve the usefulness of these statements. 

11 
Notes to Financial Statements 

1. International monetary reserves 

This category as of the latest period shown, 

September 30, 1976, comprises the following 

items: $11.6 billion in gold, 1which has been recorded at $42.22 per ounce, the statutory price 

at which gold is monetized 1by the issuance of 

Gold Certificates to the Federal Reserve System; 

$2.4 billion of Special Drawing Rights, which are 

an international reserve asset; and $3.9 billion 

representing the United States reserve position 

with the International Monetary Fund. 

2. Accrued taxes receivable 

The September 30, 1976, total for taxes receivable represents $6.0 billion (net) for delinquent taxes and $8.1 billion of accrued corporate 

taxes. The amounts as of June 30, 1975, were 

$6.4 billion and $5.4 billion, respectively. No 

accrual has been made for individual income 

taxes. (A method for accruing these taxes is 

scheduled for study.) Likewise, assessed tax deficiencies pending settlement have not been included. 

3. Loans receivable 

Outstanding loans· and allowances for losses 

have been recorded as reported by the various 

lending agencies. No attempt has been made to 

evaluate the adequacy of the allowance for losses, 

but it is presumed to be understated and is under 

study. Interest rates and loan repayment terms 

vary considerably for outstanding loans, with rates 

ranging from 2 percent to 12 percent and terms 

from as short as 90 days to well over 40 years. 

4. Inventories 

Inventories include nondepreciable personal 

property and are generally stated at cost. The 

September 30, 1976, total for inventories com-

. prises $4 7 .8 bill ion for the Department of Defense and $15.8 billion for other agencies. The 

amounts as of June 30, 1975, were $42.8 billion 

and $14.7 billion, respectively. The inventory 

accounts do not include the weapons stockpile of 

the Energy Research and Development Administration, since the extent of this inventory is 

classified information. 

12 

5. Land 

Land is valued at the cost paid by the Government. The cost of land acquired through donation, exchange, bequest, forfeiture, or judicial 

process is estimated by the General Services Administration at amounts the Government would· 

have paid if purchased at the date of acquisition. 

Pending study of valuation methods, the outer 

continental shelf, other offshore lands, and the 

704 million acres of public domain lands have ·not 

been included. In 1972 a committee of the House 

of Representatives estimated the value of public 

domain lands (93 percent of the total on-shore 

acreage owned by the Federal Government) to 

be $29.9 billion. Acreage owned by the Federal 

Government as of September 30, 1976, exclusive 

of off-shore lands, is summarized below by predominant usage. 

Usage 

Forest and wildlife ........................................... . 

Grazing .......................................................... .. 

Parks and historic sites ............ : ..................... .. 

Alaska oil and gas reserves .............................. .. 

Military (except airfields) ............................... . 

Flood control and navigation .......................... .. 

Reclamation and irrigation .............................. .. 

Industrial ................. : ............................. ! ........ .. 

Alaska native reserves ...................................... .. 

Airfields ............................................................ .. 

Research and development ................... , ........ .. 

Power development and distribution ............... . 

Other usages .................................................... .. 

Total 

6. Buildings, structures, and facilities 

Acres 

(millions) 

504.6 

163.5' 

26.0 

23.0 

18.4 

8.1 

6.0 

2.9 

.2.8 

1.9 

1.6 

1.5 

1.8 

762.1 

This category consists of all real property 

owned by the Federal Government except land. 

The total reflects the acquisition cost of buildings 

and the costs of acquiring or erecting dams, 

utility systems, monuments, roads and bridges. 

The September 30, 1976, total for this category 

represents $61. 7 bi II ion for the Department of 

Defense and $31.0 billion for other agencies. 

The amounts as of June 30, 1975, were $57.2 

billion and $34.9 billion, respectively. 
7. Depreciable personal property 

Equipment and military hardware are recorded 

at acquisition cost and include only depreciable 

personal property which is currently in use or in 

usable condition. The major components of each 

category are summarized below. 

Sept. 30, June 30, 

1976 1975 

(amounts in billions) 

Military hardware 

Aircraft and related equipment ....... $57.3 

Ships and service craft ................... 39.7 

Combat and tactical vehicles .......... 19.9 

Missiles and related equipment ...... 11.3 

Other.............................................. 5.3 

Total ........................................... $133.5 

Equipment 

Department of Defense 

Industrial plant equipment .......... $14.3 

Communication and electronics .. 4.2 

Other.......................................... 4.5 

~ 

Other agencies ................................ 79.§" 

Total .. .... .. ... .. ......... ... .. .. .. .. .......... $42.9 

8. Accumulated depreciation 

$51.6 

38.0 

17.8 

10.6 

8.6 

$126.6 

$13.9 

4.9 

3.5 

- 22.3 

---rs.a 

$41.1 

= 

Most Government agencies do not calculate 

depreciation on property and equipment. For such 

·agencies, accumulated depreciation was estimated on a straight line basis, based on available 

information. The useful lives applied to each 

classification of asset are as follows: buildings, 

structures, and facilities-50 years; ships and 

service craft-30 years; industrial plant equipment-20 years; all other depreciable assets10 years. 

Reported amounts were used for those agencies, for example, Tennessee Valley Authority and 

U.S. Postal Service, that do depreciate property 

and equipment. These agencies account for approximately 6 percent of the total accumulated 

depreciation reflected in the Consolidated Statement of Financial Position. 

9. Borrowings from the public 

The gross amount of Federal debt outstanding 

has been reduced by intragovernmental holdings 

net of unamortized premiums and discounts. The 

largest such reduction reflects the holdings of 

Government trust funds. Significant intragovernmental holdings of Federal debt securities are 

summarized below. For additional information on 

borrowings from the public, see the Federal Debt 

Maturity Schedule in the supplementary section 

(page 24). 

Sept. 30, June 30, 

1976 1975 

(amounts in billions) 

Social Security Administration 

Federal Old Age and Survivors ........ $37.1 

Federal Disability Insurance ............ 6.4 

Federal Hospital Insurance .... .... .. .... 11.0 

Federal Supplementary Medical 

Insurance .............. ...... ............ .... 1.2 

~ 

Civil Service Commission 

Civil Service Retirement and 

Disability ..................................... 42.7 

Other............................................... 2.5 

~ 

Department of Labor-Unemployment ~ 

Department of Transportation 

Highway .......................................... 9.0 

Other ............................................... 2.7 

----rr} 

Veterans Administration ..................... :--U 

Federal Deposit Insurance 

Corporation .. . .. .. .. . .. .. .. .. . .. .. .. .. .. .. .. .. .. 6.6 

Other ................................................... ~ 

Total ........................................... :$136.0 

$39.9 

8.1 

9.8 

1.4 

'79-2 

38.6 

2.0 

40.6 

~ 

9.6 

1.9 

-rTI 

--irr 

As of September 30, 1976, foreign and international investors held approximately $75.0 bill ion of the debt outstanding with the public. The 

· amount as of June 30, 1975, was $66.0 billion. 

10. Accrued pensions under retirement and 

disability plans 

The accounting for accrued pensions is subject 

to several different assumptions, definitions, and 

methods of calculation for the various retirement 

and disability plans. Specific methods applied to 

each of the major pension accruals are summarized below. Liabilities for approximately 30 

other Government pension plans are not included 

because of insufficient data. Further study and 

analysis is required for adequate valuation and 

disclosure of pension liabilities. 

Military personnel and civilian employees: 

Liabilities have been recorded based on the estimated present value of accrued benefits, as actuarially computed by the administering agencies. 

Social security: Estimates for social security 

are based on the present value of the projected 

excess of benefits over contributions for present 

participants for the next 75 years. 

13 
Veterans: the liability for Veterans Administration benefits represents the computed present 

value of annual benefit payments estimated by 

the Veterans Administration to the year 2000. 

11. Loss reserves for guarante·e and insurance 

programs 

For additi_onal information on loss reserves for 

guarantee and insurance programs, see the Commitments and Contingencies Schedule in the supplementary section (pages 22-23). 

12. Current noncash provision for social security 

The noncash provision for social security represents changes in the social security accrued 

I iabil ities between periods based on a 30-year 

amortization of the actuarial deficit. Accounting 

methods for this provision require additional 

study. . 

The noncash amounts are not included in the 

Statement of Operations because a substantial 

but indeterminate portion is not applicable to the 

current period. The Statement of Operations does 

include cash benefit payments. 

13. Contingencies 

Several Government agencies insure businesses 

and individuals against various types of risks. The 

amount of insurance coverage in force, representing the maximum risk exposure of the Government, is $1,566.9 billion as of September 30, 

1976. 

The Government also guarantees loans by nonGovernment enterprises to businesses and individuals. These guarantees become liabilities of 

14 

the Government only when the Government is required to honor its guarantees. Loan guarantees 

in force at September 30, 1976, are $194.4 billion. For further information on contingencies, 

see the Commitments and Contingencies Schedule 

in the supplemental section (pages 22-23). 

14. Open-ended programs and fixed costs 

The Government also commits itself to provide 

services by passing laws that make spending 

mandatory. Since a significant amount of future 

spending· is fixed by law, it is very probable that 

the Government will pay for these programs in 

future years. Listed below are the programs for 

the, Transition Quarter and Fiscal Year 1976 that 

can be terminated only if a law is changed. · 

TQ 1976 

(amounts in billions) 

Payments for individuals 

Social security and railroad 

retirement ................................... $20.7 $76.2 

Federal employees' retirement and 

insurance .......... .......... ................ 4.3 

Unemployment assistance ....... ........ 4.2 

Veterans benefits .. . .... .. .. .. ...... .... ..... 2.9 

Medicare and Medicaid ................... 7.0 

Housing payments ... .... .... ...... .......... .6 

Public assistance related programs . 4.9 

Net interest ................... ... ................... --=r:o 

General revenue sharing ...................... 1.6 

Other open-ended programs and 

fixed costs .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . 3.3 

Total ........................................ $56.5 

15.6 

19.8 

13.9 

26.3 

2.5 

20.2 

174.5 

26.8 

~ 

9.4 

$216.9 
Supplemental Schedules 
Introductory Statement to Suppleme.ntal Schedules 

The following schedules present a variety of information which in some cases is unique 

to the Federal Government or is not generally shown as a part of published financial statements. The information in the schedules reflects various operations of the Government under laws passed by the Congress, and in some cases shows the financial costs to the Government of providing benefits through the tax system or through other indirect means as 

opposed to direct Federal revenue collection or spending. 

There are certain schedules that are incomplete. As a prototype, this report attempts 

to show what is planned in terms of giving a comprehensive overview of Federal financial 

operations. Where figures are not available at present, this is noted in the summary 

description of the schedule (see below). 

In some cases the schedules support the financial results shown in the statements 

appearing at the front of this report; in others there is little relationship between the schedules and the financial statements. (Other differences in the characteristics of the tables 

are noted.) Consequently, each of the tables which follow should be considered individually 

as a specialized information source. 

The following schedules are presented in this section: 

Flow of Funds Projections 

The information in this schedule was taken from the 1978 Budget of the United 

States, prepared by the Office of Management and Budget, and represents projections of cash receipts and cash outlays over a 5-year period. Although the Consolidated 

Financial Statements are prepared on an accrual basis and reflect historical financial 

data, no attempt is made here to develop projections on an accrual basis. The data 

presented here also differ from the Financial Statements in that certain receipts are 

treated as reductions of outlays, accqrding to conventions adopted for budgeting purposes. 

These projections are not forecasts of future receipts and outlays, nor are they 

recommendations for policy-setting purposes. They simply reflect what may happen to 

cash basis revenues and expenditures considering certain basic assumptions reflected 

in the budget. The receipts projections are consistent with the continuation of current 

tax laws as modified in the Fiscal Year 1978 Budget. Outlay estimates indicate the degree to which resources would be committed by the continuation of existing and currently proposed programs for 1977, 1978, and 1979. 

II Financial Statements of the U.S. Government Restated for General Price-Level 

Changes 

This schedule is developed from the Statement of Financial Position and Statement of Operations. Historical values have been restated to account for changes in the 

general purchasing power of the dollar. Accounting for inflation/deflation by this 

method provides comparability between years since all dollars are equivalent to the 

current level of purchasing power. As data become available, this schedule will be expanded to include 10 years. · 

The guidelines for restatement are presented in Accounting Principles Board 

Statement No. 3 (Financial Statements Restated for General Price-Level Changes) and 

the Financial Accounting Standards Board Discussion Memorandum of February _ 15, 

1974 (Reporting the Effects of General Price-Level Changes in Financial Statements). 

17 
The conversion factors, derived from the GNP Implicit Price Deflater, are as follows: 

Transition Quarter-1.005; Fiscal Year 1976-1.011; and Fiscal Year 1975-1.067. 

Monetary assets and liabilities as of September 30, 1976, are not restated because 

they already_ represent dollars of current general purchasing power. 

Ill Effect of Tax Benefits on Federal Revenues 

The Effect of Tax Benefits on Federal Revenues Schedule is designed to show 

the revenue losses attributable to tax law provisions that allow special exclusions, exemptions or deductions from gross income or provide special credits, tax rates, or 

deferrals. The schedule shows the approximate cost of tax benefits. 

It should be noted that the effect on revenues of adding or deleting a particular 

tax benefit would not be the same as the money amount currently associated with the 

benefit. Consequently, it is not possible to say what the effects of increasing or decreasing selected benefits would be without considering a number of variables. 

Some minor distortions may have occured since data presented have been condensed for purposes of this report. 

IV Commitments and Contingencies of the U.S. Government 

The Commitments and Contingencies Schedule is designed to show two basic 

types of financial information. These are the maximum potential liabilities and the anticipated liabilities which it is reasonably certain, based on experience and other factors, will occur. The anticipated liabilities are the equivalent to allowance for losses. 

As used in commercial accounting, a commitment represents an obligation to 

pay for goods or services upon delivery under a contractual arrangement. Commit-

. ments shown here are represented by long-term contracts for which appropriations 

have not yet been provided by the Congress and undelivered orders representing obligations of currently available appropriations. 

A contingency represents a possible exposure to a liability depending upon the 

outcome of uncertain future events or circumstances. Contingencies are stated in the 

table in terms of the maximum risk exposure without regard to existing contingent assets, which would be available to offset potential losses. The "ratio of premiums written to losses incurred" represents the probability of incurring those losses. "Loss 

reserves" supports the balance sheet liability "loss reserve for guarantee and insurance 

programs" and represents the anticipated liability_. ·(Note 13) 

V Reconciliation Schedule of Accrual Operating Results to the Cash Basis Budget 

The Reconciliation Schedule of Accrual Operating Results to the Cash Basis Budget deficit reflects the separate bases used to prepare each (accrual vs. cash). The 

Consolidated Financial Statements are prepared on the accrual basis and, accordingly, 

are more comprehensive because they recognize revenues and expenses in the accounting period to which they relate rather than when the receipt or outlay takes 

place. The Unified Budget of the United States Government reflects only cash received or spent. 

The items shown as additions represent additional expenses not recognized 

under the Budget concept, while deductions are adjustments for redistribution items. 

VI Federal Debt Maturity Schedule 

18 

The Federal Debt Maturity Schedule reflects information on the borrowings of 

the Federal Government needed to finance the Government's operations. 

Information on the debt is provided bY, type of debt instrument, average interest rate charged for each type, and maturity. This schedule directly supports the 

balance sheet caption, "Borrowings from the public," which is shown net of intragovernmental holdings and unamortized premium or discount. lntragovernmental holdings 

represent that portion of the total Federal debt held by Federal entities, including the 

major trust funds. (Note 9) · 
VII Additions to Non-Federal Economic Resources 

This schedule indicates the ways in which the Government uses its resources to 

add to the physical and human resources of the nation without acquiring physical 

assets. Some of these investment type expenditures, while not adding to the Federal 

assets, add to the assets of state and local government or private institutions, and all 

enhance the future productivity of the nation. 

While this schedule does not provide a precise measure of the difference between 

capital and current items, it does indicate a useful general magnitude. 

Additions to state, local, and private assets include construction grants for highways, hospitals, and airports, subsidies to the merchant fleet, and conservation projects, which increase the value of private farmland and water resources. Other developmental expenditures reflect current Federal expenditures and grants which will 

benefit the nation in future years by increasing productivity or well being. These include research and development costs and education and training. 

VIII Analysis of Pension Liabilities 

The Analysis of Pension Liabilities Schedule is designed to provide an insight 

into the size of these programs and associated future financing requirements as of 

September 30, 1976, for all Government-financed plans. Amounts for social security, 

military personnel, civilian employees, veterans, and other plans support the liabilities on the Consolidated Statement of Financial Position. The second and third 

parts of this schedule provide information on cash flows and benefits paid to pensioners. 

To the extent that information for this schedule was available, it was obtained 

from direct contact with actuaries for the respective agencies or from published Treasury Department reports. The schedule is incomplete in two significant regards: (1) the 

number of plans ultimately to be included in the schedule is not yet resolved-as many 

as 30 to 50 separate plans might be included; and (2) no determination has been 

made concerning the appropriate accounting procedures to be used in computing 

liabilities under the various plans. There are any number of ways the liabilities might 

be computed. Methods may be ac~eptable if they are "rational and systematic" and 

result in a reasonable measure of pension cost from year to year. 

IX Estimated Interest Subsidy on Loans Outstanding 

Government public policy objectives are achieved in this area by providing credit 

for private borrowers and Government corporations on more favorable terms than are 

available to the Treasury. Many programs do not involve subsidies. This schedule attempts to measure the difference between what the Government has to pay to borrow 

funds to support its general operations and the interest an agency charges a borrower. 

The schedule shows the annual and total costs to the Government for all significant 

loan subsidy programs. Computations are based on (1) the average life of the loan, 

which represents the average number of years for repayment for each type of loan; (2) 

the average Treasury borrowing rate for comparable maturities, which is ·a computed 

average of the rate that the Treasury Department had to pay on interest bearing public 

debt at the time the loan was made to the borrower; (3) the rate charged to the borrower, which is the average interest rate charged for each program; and (4) the total 

amount loaned that is outstanding, which is the total amount that has been loaned 

by the various agencies over time and not yet repaid. 

This schedule is a very rough approximation of the costs of these programs to 

the Government. The use of annual averages, and the lack of specific information on 

comparable maturities of Public Debt Securities which should be associated with 

loans, distort the true costs. Additionally, while the schedule recognizes only 'annual 

interest cost, a more precise reading on the cost associated with specific loan programs would require capitalizing the cost at the t.ime the loans are made. The feasibility of these refinements is under consideration. 

19 
X Valuation Methods 

XI Federal Facts and Figures 

The schedule is designed to provide readers of the financial statements and 

schedules a set of recognizable benchmarks to use in making comparisons and identifying any relationships. Major emphasis has been given to providi'ng information on 

Gross National Product, the Consumer Price Index, employment, Federal debt, Federal 

expenses, and personal income taxes. In all cases the most current data available have 

been provided. 

Where data are not available or not applicable, notation is made using N/A (not available) 

or a dash (not applicable). 

SCHEDULE I 

Flow of Funds ProJecllons 

tor the Transition Quarter (TQ) and Years 1_975-1979 

Cash Receipts 

Taxes 

Individual . 

Corporation 

Social insurance taxes and contributions . 

Employment taxes and contributions : 

Unemployment insurance 

Contributions for other insurance ar:,d retirement 

Excise taxes 

Estate and gilt taxes 

Customs duties . 

Miscellaneous receipts . 

Rents and royalties .. 

Total cash receipts 

Cash Outlays by Function 

Agriculture .... 

Commerce and transportation 

Community and regional development . 

Education. training, employment, and social services . 

General government 

General science, space, and technology 

Health. 

Income security 

Interest. 

International allairs 

Law enlorcement and justice .... 

National defense ·············· Natural resources, environment, and energy , , . ...................... Revenue sharing and general purpose fiscal assistance , . , , . , , , , . , , , . , 

Veterans benefits and services .................... , , .. , , . , , , . , .. , , . 

Total cash outlays , ....... , ... , , , , , , , , ... , .. , ..... , ......... 

Net income (oencit) · .......... , .... , .... , .... , , ....... , ... 

20 

.. ··' 

(amounts in billions) 

June 30 

1976 

------<:Actual_· -----~-

1975 TO 

$122.4 $131.6 $38.8 

40.6 41.4 8.5 

75.2 79.9 21.8 

6.7 8.1 2.7 

4.5 4.7 1.3 

16.5 17.0 4.4 

4.6 5.2 1.5 

3.7 4.1 1.2 

18.4 20.0 2.9 

·2A 2.7 1.3 

·295.0. 314.7· ·54.4 

---1.7 2.5 .6 

16.0 17.3 4.7 

4.4 5.3 1.5 

15.3 18.2 5.0 

3.1 2.9 .9 

4.0 4.4 1.1 

27.6 33.5 8.7 

108.6 127.4 32.8 

31.0 34.6 7.2 

5.9 5.1 2.0 

2.9 3.3 .9 

86.6 90.0 22.5 

9.5 11.3 3.3 

7.0 7.1 2.0 

16.6 18.4 4.0 

340.2 381.3 97.2 

. .$(45.2) $((!6.6) $(12.8) 

. .. 

September 30 

1977 1978 1979 ____ Estimated ___ _ 

$160.1 $183.0 $205.3 

55.0 61.3 63.7 

92.0 104.6 123.4 

10.9 14.2 17.0 

5.1 5.3 5.7 

17.9 18.5 19.1 

7.1 5.4 6.3, 

4.7 5.3 5.9 

19.4 19.1 22.8 

2.3 2.7 2.5 

374.5 419.4 471.7 

4.5 4.4 1.9 

14.9 19.9 18.6 

7.7 9.9 7.1 

20.7 27.0 18.1 

3.8 4.0 4.0 

4.6 4.7 5.2 

39.1 44.6 46.7 

138.6 148.7 152.8 

37.8 40.9 42.4 

6.6 7.2 7.6 

.3.7 3.8 3.8 

97.1 11,.s 123.8 

16.0 20.9 20.6 

9.9 9.7 8.3 

18.2 18.8 18.0 

423.2 477.3- 478.9 

$(48.7) $(57.9) $(7.2) 
Flnanc!al Position 

Assets 

Cash and monetary reserves . 

Receivables (net of allowances) . 

Inventories . 

Property and equipment (net) 

Deferred charges and other assets 

Total assets . 

Liabilities 

Accounts payable 

Unearned revenue . 

Net borrowings from the public 

Accrued pensions under retirement and disability plans 

Loss reserves .. 

Other liabilities 

Total liabilities . 

Fiscal deficit 

Fiscal deficit beginning of period 

Current period fiscal income (deficit) . 

Current noncash provision for social security 

Fiscal deficit end of period . 

Total liabilities and fiscal deficit. 

Operating Results 

Revenues 

Individual income taxes 

Corporate income taxes 

Social insurance taxes and contributions 

Excise taxes 

Estate and gift taxes 

Customs duties 

Miscellaneous 

SCHEDULE II 

Financial Statements ol the U.S. Government 

Restated for General Price-Level Changes 

(Restated· to September 30, 1976 Dollars) 

(amounts in billions) 

Revenues earned th~ough Government business-type operations . 

Total revenues 

Expenses 

Agricullure . 

Commerce and transportation .. 

Community and regional development . 

Education, training, employment, and social services . 

General government 

General science, space and technology . 

Health. 

Income security 

Interest 

International affairs 

Law enforcement and justice .. 

Nation.al defense 

Natural resources, environment, and energy 

Revenue sharing and gene;at purpose fiscal assistance .. 

Veteran's benefits and services .. 

Total expenses ............................................................ . 

General price level gain 

Current period fiscal income or (deficit) 

TO 

$41.6 

126.4 

63.9 

148.1 

20.3 

$400.3 

---

$ 53.7 

9.8 

494.6 

997.4 

28.0 

42.7 

1,626.2 

(1,179.6) 

(18.5) 

(27.8) 

(1,225.9) 

$400.3 

---

$39.0 

12.6 

25.9 

4.5 

1.5 

1.2 

4.4 

12.2 

10·1.3 

1.9 

6.3 

3.8 

6.6 

3.2 

1.4 

11.6 

48.3 

8.1 

4.3 

1.2 

22.7 

4.9 

2.3 

4.2 

130.8 

11.0 

$(18.5) 

1976 

June 30 

$39.4. 

125.4 

65.2 

153.8 

19.1 

$402.9 

=== 

$ 46.2 

9.8 

481.8 

975.5 

26.1 

43.1 

1,582.5 

(1,042.0) 

(31.0) 

(106.6) 

(1,179.6) 

S402.9 

---

$135.4 

40.9 

95.4 

17.4 

5.4 

4.2 

10.1 

50.1 

358.9 

11.0 

18.1 

13.8 

18.4 

12.6 

4.4 

35.1 

178.3 

38.2 

12.4 

3.5 

67.5 

14.0 

6.9 

12.4 

446.6 

56.7 ---

$(31.0) 

1975 

June 30 

$30.9 

108.2 

63.1 

165.0 

18.4 

$385.6 

$ 50.0 

9.1 

421.1 

887.5 

16.6 

43.3 

1,427.6 

(976.7) 

26.3 

~ 

(1,042.0) 

$385.6 

$134.4 

41.0 

94.8 

18.2 

5.0 

4.1 

10.7 

44.4 

352.6 

15.9 

16.9 

6.8 

15.8 

8.7 

4.1 

29.7 

170.5 

35.9 

8.9 

3.1 

80.4 

8.6 

7.2 

10.3 

422.8 

96.5 

$26.3 

21 
SCHEDULE .Ill 

Effect of Tax Benefits on Federal Revenues 

tor Tax Years 1976 and 1975 

(amounts in billions) 

Individuals 

Income exclusions 

Payroll beneli1s and allowances (group lite. accident. and unemployment) 

Oisabilily and re!:rernent benefits (social security and private) 

Education allowances (scholarships and GI benefits) 

Medical care and insurance (employer premiums paid) 

Interest and dividends (state and local bonds, and lite insurclnce) 

Foreign earnings and investment incenlives (income earned abroad) 

Other (includes real estate. old age credit on home sales. and cooperatives) 

Income deferral 

Interest on savings bonds 

Real estate {home sales) 

Deductions and credits 

Old age. disability. and o!her personal exemptions 

lnveslments (commercial capital gains. depreciation. credits. 

and olher investment incentives) 

State and local non·business, property, and other taxes. 

Property damages and losses (casualty losses) . 

Medical. 

Con1ributions (charitable and political) 

Interest {mortgage and consumer). 

Dependent care and work incentives (child and dependent care) 

Real es1ate (new home purchases) 

Earned income 

·corporations 

Income exclusions 

Interest and dividends (state and local debt) 

Foreign earnings and investment incentives (domestic international sales 

corporations and western hemisphere trade corporations) 

Cooperatives 

Interest de!enal 

Taxes (shipping compan·1es) 

Real estate {capital gains) 

Deductions and credits 

Exemptions (credit unions and corporate surtax} 

Investments 

Commercial buildings and equipment (investment credit. deprecia1ron, 

cons1wction period interesl and laxes) 

Mining and timber {capital gains 1reatmen1 of royalties and certain income) 

Agriculture related (Cap·11a1 outlays and gains on certain income) 

Contributions {education and political) 

Work incentives (employment credits under work programs) 

Employee stock ownership plans (funded through investment and tax credits) 

Excess bad debt reserves (financial institutions) 

· Less than $100 million 

Commltments 

Long-1erm contracts 

Ship building ar-d operar1ons 

GSA building construction 

Energy 

Other 

Subtotal 

Undelivered orders 

SCHEDULE IV 

Commitments and Contingencies 

ot the U.S. Government 

as ot September 30, 1976 

(amounts in bi/lions) 

1976 

$2.2 

17.5 

2 

4.5 

3.7 

.1 

(1) 

6 

8 

3.7 

11.6 

12.0 

3 

2.3 

4.9 

7.0 

3 

7 

2 

3.1 

1.5 

1 

5 

4.3 

11.4 

3 

5 

Estimated amount 

of revenue loss 

1975 

$1.7 

13.2 

5 

3.3 

3.1 

.1 

.5 

.8 

35 

9.0 

13.B 

.3 

2.3 

4.9 

6.6 

.3 

u 

1.4 

.7 

3.5 

96 

2 

.2 

.6 

Amount 

outstanding 

$4,2 

2.1 

4.7 

2.0 

13.0 

Rural development . .. . .. . . .. . . . . . . . .. .. . . . . .. . . . . . . . . . . . . .. . .. . . . . . . . . . . . .. . . . . . . . . . . . . . . .. .. .. . . . . .. .. .. . .. .. .. .. . . .. .. .. .. . .. .. .. .. . . . .. .. .. . . . 2.0 

Export-Import Bank . . . . . . . . . . . .. . . .. . . .. .. .. .. .. .. .. . .. .. .. . .. .. . .. .. .. . .. .. . .. . .. .. .. .. . .. .. . . .. .. .. . . .. .. .. .. .. .. . .. .. .. .. .. .. . .. .. .. .. .. .. . . . .. 2.6 

Other ............................................................................... :............................................................. .4 

Subtotal . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . • . . . . . . . . . . . • .. . . • .. . . . . . . . . • . • • . • . . . • . • . .. • • . . . • . . • . . . . . . . • . .. • . . . . . . . . • • 5.0 

Total commitments . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . .. . . . . . . . . . . . .. . ... .. . . . . .. . . . . . . ... . . . . . . .. . . . .. . $18.0 

22 
Contingencies 

Government loan and credit guarantees 

Housing ... 

Export-Import Bank 

Business loan and investment fund 

Farm ownership 

Rural development 

Ship building and operations 

Non-Federal loans ... 

Other. 

Subtotal 

Insurance in force 

Federal Deposit Insurance Corp. 

Federal Savings and Loan Insurance Corp. 

Federal Insurance Administration .. 

Other. 

Subtotal 

Unadjudicated claims 

Health .. 

Transportation . 

Treasury. 

Other .. 

Subtotal 

International contingencies 

Inter-American Development Bank 

International Bank lor Reconstruction 

and Development 

Other. 

Subtotal 

Other contingencies 

Veterans readjustment benefits 

Other 

Subtotal 

Total contingencies . 

Total loss reserves 1. .. 

• Less than $100 million. 

· Reported Budget Outlays over Receipts (Cash Basis) .. 

Add: 

Schedule IV-Continued 

Contingent 

liability 

(maximum risk exposure) 

$153.5 

6.0 

5.5 

5.8 

8.7 

5.0 

4.0 

5.9 

~ 

587.8 

316.2 

520.8 

142.1 

1,566,9 

4.1 

5.4 

2.6 

1.9 

14.0 

3.0 

7.1 

.2 

10.3 

23.8 

5.1 

28.9 

$1,814.5 

---

SCHEDULE V 

Reconclllatlon Schedule of Accrual Operating Results to 

the Cash Basis Budget 

tor the Transition Quarter (TC) ended September 30, 1976, 

and the Year ended June 30, 1976 

(amounts in billions) 

Noncash provisions lor retirement and disability benefits 

Depreciation 

Net expenses of oil-budget agencies 

Guarantee and insurance program losses 

Noncash purchases and operating expenses 

Deduct: 

Capital outlays 

Net loan disbursements 

Seigniorage ... 

Net ellect of other accrual adjustments 

Current period liscal delicit per Consolidated Statement 

of Operations (accrual basis) ......................................................... . 

Loss ratio Loss 

(percent) reserves 

2.08% $3.2 

.07 

7.27 .4 

.69 

.23 

.40 

1.75 .1 

28.81 1.7 

--5.4-

.06 .4 

3.26 10.3 

.04 .2 

4.16 5.9 

16.8 

100.00 4.1 

1.00 .1 

23.08 .6 

21.05 .4 

5.2 

-0- -0-

-0- -0-

-0- -0-

-0-

1.45 .4 

1.96 .1 

.5 

$27,.9 

TO June 30 

$13.0 $66.4 

4.8 29.9 

2.1 8.6 

1.8 7.2 

2.6 10.2 

9.0 2.4 

20.3 58.3 

6.0 24.6 

3.7 10.9 

.1 .7 

9.8 36.2 

-- 6.1 (3.3) 

$29.6 $85.2 

--

23 
SCHEDULE VI 

Federal Debt Maturity Schedule 

as of June 30, 1976, and September 30, 1976 

(amounts in billions) 

September 30 

June 30 Average within one to 

Total Total interest one five 

debt debt rate year years 

Marketable 

Bills $159.5 $159.7 5.518% $159.7 S:- Notes 182.8 198.5 7.366 42.5 120.8 

Bonds. , 28.8 29.7 5.861 3.5 

371,1 387.9 6.490 202.2 124.3 

Nonmarketable 

Foreign government 

series 21.5 20.9 6.468 8.8 9.1 

Government account 

series 1.3 1.2 6.871 .8 .4 

Investment series . .2 .2 2.750 .2 

U.S. savings bonds 69.7 70.8 5.218 3.3 21.1 

Other ... 2.7 3.4 6.978 

95.4 96.5 5.566 12.9 30.8 

Other 

Agency securities . 8.9 9.1 6.177 .9 2.5 

Other. 1.2 1.1 -

10.1 ..., 10.2 6.177% .9 2.5 

Net borrowings from the public 

Current period .. 476.6 494.6 216,0 157.6 

Prior period 394.4 476.6 NIA NIA, -- Net increase (decrease) . , $82.2 $18.0 $NIA_ $NIA -- -- --

SCHEDULE VII 

Additions to Non-Federal Economic Resources 

for the Transition Quarter (TQ) ended September 30, 1976, 

and Years ended June 30, 1976, 1975, and 1974 

(amounts in billions) 

Additions to State, _Local, and Private Assets 

Conservation .. 

Economic development . 

Environment 

Health 

Housing 

Transportation 

Highways .......................................... , , , , ....... , . , , • • , , , , • • • • • • • · · · · · · · · · · · · 

Mass transit .............................................................................. .. 

Aviation and other ........................................................................ .. 

Other ....................................................................................... . 

Total additions ........................................................................... .. 

Other Developmental Expenditures 

Agricultural research . 

Conservation 

Education. 

Employment assistance and training . 

Environment .. 

Health. 

Human development 

National defense 

Science and humanities 

Social services . 

Transportation . 

Other. 

Total development expenditures 

Total investment outlays 

• Less than $100 million. 

24 

TO 

$.2 

.2 

1.0 

,1 

.1 

1.6 

.2 

.1 

3.5 

.1 

.7 

1.5 

1.7 

.1 

1.4 

2.4 

1.4 

2.3 

.1 

.2 

11,9 

$15.4 

--

Maturity 

live to ten to 

ten twenty 

years years 

$- $-

35.2 

6.0 9.4 

41.2 9.4 

3.0 

2.7 

5.7 

1.0 1.6 

1.0 1.6 

47,9 11.0 

NIA ,NIA 

-- $NIA $NIA 

1976 

June 30 

$.9 

.6 

2.5 

,6 

.1 

6.1 

1.0 

.3 

,2 

12.3 

.5 

2.3 

5.9 

6.1 

.2 

5.1 

.8 

9.3 

5.1 

9.0 

.3 

.8 

45.4 

$57.7 

twenty 

years or no fixed 

longer maturity 

$- $-

10.8 

10.8 

43.7 

3.4 

47.1 

1.6 1.5 

1.1 

1.6 2.6 

12.4 49.7 

NIA NIA 

-- $NIA $NIA 

--

1975 1974 

June 30 June 30 

$.9 $.5 

.7 .6 

2.0 1.6 

.5 .4 

.3 

4.6 4.3 

.7 .5 

.3 .3 

.2 .4 

9.9 8.9 

.4 .4 

1.5 1.5 

5.4 4.0 

3.9 2.7 

.6 .1 

4.5 3.5 - .6 .6 

9.4 9.0 

4.6 4.4 

7.2 6.2 

.3 .3 

.9 1,1 --

39.3 33.8 

$49.2 $42.7 

--
Pension Llabllllles 

Accrued liability, July 1, 1975 

Add: 

Accruals 

Deduct: 

Benelits paid 

Accrued liability: September 30, 1976 . 

Accrued liability, September 30, 1976 

Cumulative trust fund transactions through end ol period 

Receipts · · 

Expenditures (net ol unamortized discount and 

premium on investments) ... 

Total assets of the trust fund 

Liability net of trust lund balance, 

September 30, 1976 

SCHEDULE VIII 

. Analysis ol Pension Llabllllles 

as ot September 30, 1976 

(amounts in bill,ons} 

Social 

security 

$499.5 

209.5 

78.2 

$630.8 

$630.8 

643.0 

599.5 

43.5 

$587.3 

Military 

Military Civilian 

personnel employees 

$96,6 $118.0 

30.0 24.2 

7,3 8.3 

$119.3 $)33.9 

--

$119,3 $133.9 

102.0 

59.3 

42,7 

$119.3 $91.2 

Number Social security personnel Civil Service Employees 

ol years %of contribution 

covered taxable payroll amount amount rate :amount 

Projected Cash Receipts and 

Disbursements 

Cash receipts 

1976 ····················· 9.90% $71.6 $7,3 7.0% $12.8 

1977-1980 4 9.90 377.3 37.4 7.0 67.2 

1981-1990. 10 9.90 1,651.0 163.8 7.0 259.9 

1991-2000. 10 9.90 3,059.4 295.0 7.0 447.5 

Subtotal ~5 9.90 5,159.3 503.5 7,0 787.4 

2001-2025 25 11.10 26,498.0 7.0 2,736.4 

2026-2050. 25 11,90 108,484.5 7.0 2,283.5 

Total 140,141.8 503.5 5,807.3 

Cash disbursements 

1976 ... 10.78 78.2 7.3 8.3 

1977-1980. 4 10,72 408.3 37.4 51.8 

1981-1990 10 11.28 1,894.5 163,8 194.8 

1991-2000 . 10 12.88 4,000.0 . 295.0 342.8 

Subtotal 25 11.81 6,381.0 503,5 597.7 

2001-2025 .. 25 17,95 44,7~9.1 2,362.8 

2026-2050 .... 25 27.04 250,130.5 2,201.1 

Total ...... 301,240.6 503.5 5,161.6 -- Net receipts or (disbursements) $(161,098.8) $0 $645.7 

Calendar Year 

1976 1975 1974 1973 1972 1971 1970 1969 

Beneficiaries 

Number receiving benelits (thousands) 

Social security 33,024 32,085 30,854 29,872 28,345 27,289 26,235 25,312 

Military personnel .. 1,129 1,070 1,007 946 890 831 773 714 

Civilian employees 1,432 1,372 1,302 1,192 1,092 1,026 959 910 

Veterans and survivors 2,270 2,269 2,309 2,344 2,313 2,264 2,250 2,236 

Other plans N/A N/A N/A N/A N/A NIA N/A N/A 

Average monthly benefit (dollars) 

Social security $194 $179 $162 $143 $137 $112 $100 $85 

Military personnel 772 713 626 528 502 488 440 412 

Civilian employees .. : ...... ,, ...... 495 439 366 308 276 266 231 212 

Veterans and survivors , , .. , ... , .... 272 206 190 187 186 175 168 161 

Other plans .......... , , , , , , ....... N/A N/A 'N/A N/A N/A NIA N/A N/A 

Veterans Other 

$117,3 SN/A 

(.2) N/A 

3.7 N/A 

$113.4 $NIA 

-- $113.4 $NIA 

N/A. 

N/A 

N/A 

$113.4 $NIA 

Veterans Other 

· amount amount 

$3,7 $NIA 

10.9 N/A 

35.2 N/A 

17.2 N/A 

67.0 N/A 

N/A 

N/A 

67,0 N/A 

3.7 N/A 

10.9 N/A 

35.2 N/A 

17.2 N/A 

67,0 NIA 

N/A 

N/A 

67.0 N/A 

$0 $NIA 

1968 1967 

24,562 23,707 

651 590 

872 831 

2,218 2,193 

N/A N/A 

$84 $73 

394 380 

200 188 

153 148 

N/A N/A 

25 
Agencx__and Program 

Direct loans 

Funds appropriated to the President 

International security assistance ... 

International development assistance 

Agriculture 

Price support 

CCC: Public Law 480 

Rural Electrilication Administration 

Health, Education and Welfare 

Education and health education 

Medical facilities ...... . 

Student loan funds . 

Housing and Urban Development 

Urban renewal 

Low rent public housing 

Housing for elderly . 

Veterans Administration 

Insurance policy loans 

Export-Import Bank 

Smalt Business Administration 

Business and investment loans 

Disaster loan fund 

• Less than $100 million. 

Items 

Gold 

Valuation methods identified 

by the Task Force 

and the Advisory Committee 

·Record at the statutory price 

SCHEDULE IX 

Estimated lnlerest Subsidy 

on Loans Outstanding 

as of September 30, 1976 

(amounts in billions) 

Average 

life 

of 

loan 

NIA 

NIA 

25.0 

NIA 

.7 

.7 

NIA 

NIA 

Average 

Treasury 

borrowing 

rate for 

comparable 

maturities 

NIA 

NIA 

6.388 

NIA 

6.436 

6.436 

NIA 

NIA 

SCHEDULE X 

Valuatton Methods 

Record at the market price as ol the balance sheet date 

Loans Cost, net of allowances 

Rate 

charged 

borrower 

NIA 

NIA 

6.003 

NIA 

3.081 

3.501 

NIA 

NIA 

Total 

amount 

loaned 

outstanding 

$NIA 

NIA 

.1 

NIA 

1.9 

56.7 

NIA 

NIA 

$58.7 

Inventories Cost for stockpiled materials for which no ready market is available and for material and supply stocks used and 

purchased on a regular basis 

Land 

Buildings, 

structures. 

and 

facilities 

Equipment 

26 

Indexed cost for all stockpiled materials 

Current value for excess stockpiled materials and for inventoried stockpiled materials and supplies for which 

there is a market 

__ Current value for all inventories 

Discounted cash flow for offshore (Continental shell) tor proven reserves 

A second tier cash flow based on lease value for unproven reserves 

The best measure of current value for recreation, and forest and timber lands 

The best measure of current value for alt other land 

Market price less cost to market proven reserve 

Capitalize future income flow and' recognize depletion 

Historical cost for all land 

Appraised or current value 

Indexed historical cost 

Historical cost 

Historical cost for power systems and utility systems when there is a revenue limitation based on cost, otherwise 

use indexed cost 

Current value based on GSA rentals for federally owned office buildings 

Indexed cost for public buildings 

Indexed cost for military facilities 

Monuments to be written ofl when purchased 

Indexed cost for monuments 

Appraisal value or market value for art objects 

Cost 

Indexed cost for military hardware 

Total 

cost to 

Government 

$NIA 

NIA 

NIA 

.1 

.2 

NIA 

NIA 

$.3 

Valuation 

method 

currently 

used 

X 

X 

X 

X 

X 

X 

Annual· 

cost to 

Government 

$NIA 

NIA 

NIA 

.1 

.2 

NIA 

NIA 

$.3 

Advisory 

Committee 

preference 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 

X 
SCHEDULE XI 

Federal Facts and Figures 

Unit of 

Measure 1976 1975 1974 

Gross National Producl 

Current dollars billions 1,691 1,516 1,413 

Per capita dollars 7,851 7,016 6,640 

1972 dollars ... billions 1,265 1,192 1,214 

Per capita dollars_ 5,883 5,552 5,714 

Population (includes Armed Forces) millions 215.4 213.5 211.9 

Consumer Price Index 

All items (1967 = 100). ············ 170.5 161.2 147.7 

Purchasing power (1967 = $1.00) . .58 .62 .68 

Employment 

Total labor force millions 95.2. 94.8 93.2 

Total employed . millions 87.8 84.8 85.9 

Federal employment 

Armed Forces ... millions 2.2 2.1 2.2 

Civilian millions 2.9 2.9 2.9 

Federal emploY.ment as a percent 

of total U.S. employment percent 5.8 5.9 5.9 

Federal Debi 

Gross debt .... billions 645.7 544.1 486.2 

1972 dollars . billions 482.9 427.6 417.7 

Held by public (current dollars) billions 494.6 394.4 343.6 

1972 dollars .. billions 369.8 309.9 295.2 

Percent ol GNP percent 29.2 26.0 24.3 

Per capita dollars 2,296 1,847 1,622 

Interest on the Federal debt (current dollars) billions 45.2 32.7 29.3 

1972 dollars (interest) billions 34 26 25 

Per capita dollars 210 153 138 

Percent of GNP percent 2.6 2.2 2.1 

Percent of total Federal expenses percent 6:5 7.0 7.3 

Total Federal Expenses (accrual) 

Current dollars billions 695.6 468.7 399.8 

Percent of GNP percent 41.1 30.9 28.3 

Per capita dollars 3,229 2,195 1,887 

Personal Income 

Current dollars billions 1,392 1,254 1,148 

Percent of GNP percent 82.3 82.7 81.2 

Per capita dollars 6,460 5,832 5,450 

1972 dollars . billions 1,037 996 985 

Percent of GNP percent 82.0 83.6 81.1 

Per capita dollars 4,814 4,663 4,646 

Tola/ Income Taxes Paid for 

Adiusted Income Levels 

Under $5,000 ··········· billions N/A 1,2 2.2 

Number of taxpayers . thousands N/A 7,269 11,709 

$5,000 - $9,999 , .... billions N/A 10.8 13.6 

Number of taxpayers . thousands N/A 17,506 19,740 

$10,000 - $14,999 billions N/A 19.2 21.5 

Number of taxpayers .. thousands N/A 14.720 15,539 

$15,000 - $24,999 billions N/A 38.2 37.8 

Number of taxpayers . thousands N/A 15,837 14,944 

$25,000 - $49,999 billions N/A 29.6 25.0 

Number of taxpayers . thousands N/A 5.458 4,451 

$50,000 - $99,999 billions N/A 13.4 12.2 

Number of taxpayers . thousands N/A 776 699 

$100,000 - $999,999 . billions N/A 11.3 10.2 

Number of taxpayers thousands N/A 185 165 

$1,000,000 and over billions N/A 1.1 (1 

Number of taxpayers thousands N/A 

Federal Participalion in Domestic 

Credi/ Markels 

Total funds advanced in U.S. credit 

markets (non-financial sectors) . billions 239.4 183.3 191.4 

Total funds advanced under Federal guidance 

(direct and guaranteed loans) . billions 26.6 26.9 26.6 

Federal participation rate percent 11.0 14.7 13.9 

Total funds raised in U.S. credit markets 

(non-financial sectors) billions 239.4 183.3 191.4 

Total funds raised under Federal guidance (includes Federal 

borrowing from the public, guaranteed borrowing, 

and sponsored agency borrowing) . billions 97.5 64.7 24.1 

Federal participation rate percent 40.7 35.3 12.6 

27 
DEPARTIVIENT OF THE TREASURY 

FISCAL SERVICE 

BUREAU OF GOVERNMENT FINANCIAL OPERATIONS 

WASHINGTON, D.C. 20226 

OFFICIAL BUSINESS 

PENALTY FOR PRIVATE USE, $300 

POSTAGE AND FEES PAID 

DEPARTMENT OF THE TREASURY 

TREAS 553 

~-~I 

I 

! 

I 

I 

-t