federal trade commission

performance

& accountability

report

fiscal year 2012

I

introduction

fiscal year 2012

ABOUT THIS REPORT

The Federal Trade Commission’s (FTC) Fiscal Year (FY) 2012 Performance and Accountability report (PAR) 

provides the results of the agency’s program and financial performance and demonstrates to the Congress, the 

President, and the public, the FTC’s commitment to its mission and accountability over the resources entrusted to it.

This report, available at the FTC’s website (www.ftc.gov/par), includes information that satisfies the reporting 

requirements contained in the following legislation:

• Federal Managers’ Financial Integrity Act of 1982

• Government Performance and Results Act of 1993

• Government Management Reform Act of 1994

• Reports Consolidation Act of 2000

• Accountability of Tax Dollars Act of 2002

• Improper Payments Information Act of 2002 

• GPRA Modernization Act of 2010

The performance and financial information contained in this report is summarized in a “Summary of Financial and 

Performance Information” report available at www.ftc.gov/par by February 2013.

Certificates of Excell

Robert F. Dacey, CGFM, CPA 

Chair, Certificate of Excellence 

in Accountability Reporting Board

CERTIFICATE OF

EXCELLENCE IN

ACCOUNTABILITY

REPORTING®

BEST-IN-CLASS AWARD

Presented to the

In recognition for Providing the

Most Informative Performance Section

in your FY2011 Performance and Accountability report

Federal Trade 

Commission

Relmond P. Van Daniker, DBA, CPA 

Executive Director, AGA

 CERTIFICATE OF 

 EXCELLENCE IN 

ACCOUNTABILITY

 REPORTING®

Presented to the

In recognition of your outstanding efforts in

preparing the agency’s Performance and

Accountability Report and Summary of 

Performance and Financial Information for 

the fiscal year ended September 30, 2011.

A Certificate of Excellence in Accountability Reporting is presented 

by AGA to federal government agencies whose Annual 

Financial Reports achieve the highest standards demonstrating 

accountability and communicating results.

Federal Trade 

Commission

Relmond P. Van Daniker, DBA, CPA 

Executive Director, AGA

Robert F. Dacey, CGFM, CPA 

Chair, Certificate of Excellence 

in Accountability Reporting Board

 CERTIFICATE OF 

 EXCELLENCE IN 

ACCOUNTABILITY

 REPORTING®

Presented to the

In recognition of your outstanding efforts in

preparing the agency’s Performance and

Accountability Report and Summary of 

Performance and Financial Information for 

the fiscal year ended September 30, 2011.

A Certificate of Excellence in Accountability Reporting is presented 

by AGA to federal government agencies whose Annual 

Financial Reports achieve the highest standards demonstrating 

accountability and communicating results.

Federal Trade 

Commission

Relmond P. Van Daniker, DBA, CPA 

Executive Director, AGA

Robert F. Dacey, CGFM, CPA 

Chair, Certificate of Excellence 

in Accountability Reporting Board

The FTC received the Association of Government Accountants’ Certificate of Excellence in Accountability Reporting

for its FY 2011 PAR and a Best-In-Class award for Most Informative Performance Section.
introduction

II Federal Trade Commission | Performance and Accountability Report 

HOW THIS REPORT IS ORGANIZED

This report includes four major sections, plus supplemental information.

1. Management’s Discussion and Analysis Section 

The Management’s Discussion and Analysis (MD&A) Section provides 

an overview of the FTC’s mission and organization, an overview of key 

performance measures and efficiency measures, mission challenges, 

financial highlights, and management assurances on internal controls, 

financial systems, and compliance with laws and regulations.

2. Performance Section 

The Performance Section explains the FTC’s performance relative to 

its strategic goals and objectives, and includes an overview of how the 

performance data are verified and validated. 

3. Financial Section

The Financial Section provides financial details, including the 

independent auditor’s report and audited financial statements with 

accompanying notes. 

4. Other Accompanying Information Section 

The Other Accompanying Information Section provides management and 

performance challenges identified by the Inspector General along with 

the Chairman’s response and a summary of financial statement audit and 

management assurances. 

5. Appendices

Appendix A provides the data quality information for FTC’s performance 

measures; Appendix B lists the acronyms used throughout this report; 

Appendix C lists useful links for references; Appendix D provides contact 

information and acknowledgements.

management’s discussi

& analysis performanc

financial other accompany

information appendi
IIIintroduction

fiscal year 2012

THE FTC AT-A-GLANCE

History

The federal government created the Bureau of 

Corporations in 1903. In 1914, President Woodrow 

Wilson signed the Federal Trade Commission Act into 

law, and the Bureau of Corporations became the FTC.

Laws Enforced

The FTC is a law enforcement agency with both 

consumer protection and competition jurisdiction in 

broad sectors of the economy. The agency administers 

a wide variety of laws and regulations. Examples includ

the Federal Trade Commission Act, Telemarketing Sale

Rule, Identity Theft Act, Fair Credit Reporting Act, and

Clayton Act. In total, the Commission has enforcement

or administrative responsibilities under more than 70 

laws (see http://www.ftc.gov/ogc/stats.shtm for a listing).

e 

s 

Profile

• The agency is headquartered in Washington, 

DC, and operates with seven regions across the 

United States. 

• The agency had over 1,100 full-time equivalent 

employees at the end of FY 2012.

• Total new budget authority for FY 2012 was 

$313 million.

did you know?

Consumers are affected every day by the FTC’s activities. For example, consumers 

receive fewer telemarketing calls, obtain free credit reports, receive less spam, 

receive identity theft victim assistance, access truthful information about health 

and weight-loss products, pay lower prescription drug prices thanks to the 

availability of generic drugs, and enjoy competitive prices for goods as a result of 

merger reviews and actions taken by the FTC. In addition:

• The agency manages the National Do Not Call (DNC) Registry, which 

gives consumers the opportunity to limit telemarketing calls. At the end 

of the fiscal year, there were more than 217 million active registrations on 

the DNC Registry.

• In FY 2012, the FTC took action against mergers likely to harm 

competition in markets with a total of $20.2 billion in sales. The agency’s 

efforts to maintain aggressive competition among sellers benefit 

consumers through lower prices, higher quality products and services, 

additional choice, and greater innovation.

• The FTC shares the more than 20 million consumer fraud, identity theft, 

financial, and DNC Registry complaints it has collected during the past 

five years with more than 2,000 law enforcement partner agencies 

worldwide via the secure Consumer Sentinel Network website.
The Federal Trade Commission has a unique dual 

mission to protect consumers and to maintain 

competition in broad sectors of our economy. 

We safeguard consumers’ privacy, whether shopping 

online, using a social network, or applying for a job. 

We stop deceptive advertising, shady marketing 

practices, and financial scams. We promote competition 

for medical and dental care providers, health services, 

and prescription drugs. And, we work to stay informed 

about new technologies, which can bring tremendous 

benefits to consumers, but also pose challenges on both 

the competition and consumer protection fronts. 

In 2012, our staff has continued to exemplify 

good government, effective law enforcement, 

and outstanding outreach to consumers, businesses, 

and our law enforcement partners around the world. 

This Performance and Accountability Report illustrates 

how we managed our resources, highlights our major 

accomplishments, and outlines our plans to address 

the challenges ahead. 

FY 2012 PERFORMANCE HIGHLIGHTS

Consumer PrivaCy

The FTC protects consumer privacy through policy 

work, law enforcement, and consumer and business 

education. In March 2012, the Commission issued a 

final report outlining best practices for businesses to 

protect the privacy of American consumers and give 

them greater control over the collection and use of their

personal data. The FTC also brought actions charging 

that Facebook and Google did not keep promises they 

made about privacy. Settlement orders in both cases 

protect more than one billion users worldwide. Google 

subsequently agreed to pay a record $22.5 million civil 

penalty to resolve charges that it violated its FTC order 

by misrepresenting privacy assurances to Safari browser 

users; this settlement is pending court approval. 

MESSAGE FROM 

THE CHAIRMAN

Jon Leibowitz 

Chairman

introduction

IV Federal Trade Commission | Performance and Accountability Report 
companies to provide consumer refunds. 

The FTC also polices the internet for deceptive ads, 

and recently brought a slew of cases against marketers 

that allegedly created fake news web sites touting acai 

berry supplements as effective weight-loss products.

outreaCh and PartnershiPs 

Consumers, industry, and our law enforcement 

partners keep us informed about real-world trends and 

challenges in the marketplace. Consumers can contact 

us online or via toll-free phone numbers. Our public 

outreach also includes online resources, such as www.

ftc.gov (much of which is available in Spanish), as well 

as printed publications. We also provide updates on 

Facebook and Twitter, and host fun and educational 

videos on the FTC’s YouTube channel. The FTC’s 

online Business Center offers extensive guidance 

to businesses.

finanCial management

Of course, being diligent and responsible stewards 

of the public resources that the American taxpayers 

and the Congress provide to us is one of our 

most important jobs. For the FY 2012 independent 

financial audit, we received our 16th consecutive 

unqualified opinion, the highest audit opinion available. 

The independent auditors did not identify any material 

weaknesses, significant deficiencies, or instances of 

non-compliance with laws and regulations. I am pleased

to report that management’s assessment of risks and 

review of controls disclosed no material weaknesses 

(see Statement of Assurance, p. 26) and that the 

financial and performance data presented here is 

reliable and complete. 

Jon Leibowitz

November 15, 2012

Vintroduction

fiscal year 2012
introduction

VI Federal Trade Commission | Performance and Accountability Report 

PerformanCe seCtion ............................................................................................................... 35

Introduction to performance ........................................................................................................................ 36

 relationship of outputs to outcomes ............................................................................................ 36

 Verification and Validation of performance data ........................................................................... 36

 performance measure summary tables .......................................................................................... 39

strategic goal #1: protect consumers .......................................................................................................... 48

strategic goal #2: maintain competition .................................................................................................... 69

strategic goal #3: advance performance ..................................................................................................... 93
VIIintroduction

fiscal year 2012
MANAGEMENT’S DISCUSSION & ANALYSIS

VIII Federal Trade Commission | Performance and Accountability Report 

THIS PAGE INTENTIONALLY LEFT BLANk
fiscal year 2012

’

s

& 
MANAGEMENT’S DISCUSSION & ANALYSIS

2 Federal Trade Commission | Performance and Accountability Report 

MISSION AND 

ORGANIZATION

The work of the Federal Trade Commission (FTC) 

is critical to protecting and strengthening free and 

open markets and promoting informed consumer 

choice, both in the United States (U.S.) and 

around the world. The FTC performs its mission 

through the use of a variety of tools, including 

law enforcement, rulemaking, research, studies on 

marketplace trends and legal developments, and 

consumer and business education.

The FTC’s Vision

A U.S. economy characterized by vigorous 

competition among producers and consumer 

access to accurate information, yielding highquality products at low prices and encouraging 

efficiency, innovation, and consumer choice.

The FTC’s Mission

To prevent business practices that are 

anticompetitive or deceptive or unfair to 

consumers; to enhance informed consumer 

choice and public understanding of the 

competitive process; and to accomplish this 

without unduly burdening legitimate business 

activity.

www.culturaltourismdc.org/sites/default/files/Fed-Tri-Booklet-lores.pdf.
3

MANAGEMENT’S DISCUSSION & ANALYSIS

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The FTC: Our Purpose and History

Consumers and businesses are likely to be more 

familiar with the work of the FTC than they think. 

In the consumer protection area, the product 

warranties, care labels in clothes, and labels 

showing the energy costs of home appliances 

provide information that is required by the FTC. 

Likewise, businesses must be familiar with the laws 

requiring truthful advertising and protecting consumers’ 

personally identifiable and sensitive health information. 

These laws are enforced by the FTC.

Competition among independent businesses is good 

for consumers, the businesses themselves, and the 

economy. Competitive markets yield lower prices 

and better quality goods and services, and a vigorous 

marketplace provides the incentive and opportunity for 

the development of new ideas and innovative products 

and services. Many of the laws governing competition 

also are enforced by the FTC. 

The FTC has a long tradition of maintaining a 

competitive marketplace for both consumers and 

businesses. When the FTC was created in 1914, its 

purpose was to prevent unfair methods of competition

in commerce as part of the battle to “bust the trusts.” 

Over the years, the Congress passed additional laws 

giving the agency greater authority over anticompetitiv

practices. In 1938, the Congress passed a broad 

prohibition against “unfair or deceptive acts or practice

in or affecting commerce.” Since then, the FTC also 

has been directed to enforce a wide variety of other 

consumer protection laws and regulations, including th

Telemarketing Sales Rule, the Identity Theft Act, and 

the Equal Credit Opportunity Act.

e 

s 

e 

the ftC’s 

inCePtion and 

authority

The Bureau of Corporations, created i

1903, served as the FTC’s predecessor

agency. It was the Supreme Court’s 

1911 decision in the Standard Oil case 

(Standard Oil Co. v. U.S., 221 U.S. 1 (1911

that prompted the transformation 

from the Bureau of Corporations to th

FTC. The decision resulted in the FTC 

Act of 1914, where Congress created 

an administrative agency charged with preventing “unfair methods of competition,” giving

definition to that general prohibition, utilizing a number of quasi-judicial powers to enforce

that prohibition, and enforcing the Clayton Act. The FTC Act was later amended to prohibi

unfair or deceptive acts or practices and the FTC currently maintains enforcement and 

administrative responsibilities under 70 laws. For a description of and further information 

regarding each law, visit: www.ftc.gov/ogc/stats.shtm.

n 

)) 

e

t 
MANAGEMENT’S DISCUSSION & ANALYSIS

4 Federal Trade Commission | Performance and Accountability Report 

Our Organization

The FTC is an independent agency that reports to th

Congress on its actions. These actions include pursui

vigorous and effective law enforcement; advancing 

consumers’ interests by sharing its expertise with 

federal and state legislatures and U.S. and internationa

government agencies; developing policy and research 

tools through hearings, workshops, and conferences; 

and creating practical and plain-language educational 

programs for consumers and businesses in a global 

marketplace with constantly changing technologies. 

The FTC is headed by a Commission composed of 

five commissioners, nominated by the President and 

confirmed by the Senate, each serving a seven-year 

term. The President chooses one commissioner to 

act as Chairman. No more than three commissioners 

e 

ng 

l 

may be from the same political party. Chairman Jon 

Leibowitz was confirmed for a second term by the U.S. 

Senate on March 29, 2012. Previously, he was designated 

to serve as Chairman of the FTC on March 2, 2009, by 

President Barack H. Obama. Chairman Leibowitz was 

previously sworn in as a commissioner on September 

3, 2004, following his nomination by the President and 

confirmation by the U.S. Senate. At the end of the fiscal 

year, the commissioners were J. Thomas Rosch, Edith 

Ramirez, Julie Brill, and Maureen Ohlhausen.

The FTC’s mission is carried out by three bureaus: 

the Bureau of Consumer Protection, the Bureau of 

Competition, and the Bureau of Economics. Work 

is aided by offices, including the Office of General 

Counsel, the Office of Inspector General, the Office 

of International Affairs, the Office of the Executive 

Director, and seven regions.

The FTC Commission, as of September 30, 2012: (back row, left to right) Maureen Ohlhausen, 

Commissioner; Julie Brill, Commissioner (front row, left to right) J. Thomas Rosch, Commissioner; 

Jon Leibowitz, Chairman; Edith Ramirez, Commissioner.
5

MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

Office of 

Administrative Law Judges*

D. Michael Chappell

Office of 

Inspector General*

Scott E. Wilson

Office of Equal

Employment Opportunity

Kevin Williams

Office of the 

Executive Director

Eileen Harrington

Chairman

Jon Leibowitz

-----------

Chief of Staff

Joni Lupovitz

Commissioner

Edith Ramirez

Commissioner

J. Thomas Rosch

Commissioner

Julie Brill

Bureau of

Economics

Howard Shelanski

Office of the 

General Counsel

Willard K. Tom1

Commissioner

Maureen Ohlhausen

Office of 

International Affairs

Randolph W. Tritell

Office of 

Policy Planning

Andrew I. Gavil

Office of Public Affairs

Cecelia Prewett

Office of 

Congressional Relations

Jeanne Bumpus

Bureau of

Consumer Protection

David Vladeck

Bureau of

Competition

Richard Feinstein

Office of the Secretary

Donald S. Clark 

Regions

Federal Trade Commission Organization Chart

* An independent organization within the FTC

1

 Willard Tom left the agency on October 27, 2012
MANAGEMENT’S DISCUSSION & ANALYSIS

6 Federal Trade Commission | Performance and Accountability Report 

The agency is headquartered in Washington, DC, and operates with seven regions across the U.S. The graphic below 

illustrates the locations of the FTC regions.

Our People

The FTC’s workforce is its greatest asset. The agency’s workforce consists of over 1,100 civil service employees 

dedicated to addressing the major concerns of American consumers. The chart below shows workforce composition

by category.

FTC’S WORKFORCE COMPOSITIO

Attorneys; 613

Economists; 77

Paralegal; 75

Senior Management; 44

Other*; 362

*“Other” includes support staff, program management, investigators, and information technology-related

occupations.
7MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

PERFORMANCE 

OVERVIEW

This section explains the FTC’s strategic and 

performance planning framework and summarizes 

the key performance measures and efficiency measures 

reported in the Performance Section. The Performance 

Section contains details of program performance 

results, trend data by fiscal year, resources, strategies, 

factors affecting performance, and the procedures 

used to verify and validate the performance data. 

The financial data and performance results described in 

this report enable the FTC to administer its programs, 

gauge their success, and make adjustments necessary to 

improve program quality for the public. The steps the 

FTC has taken to ensure the performance information 

it reports is complete, accurate, and consistent are 

described in the Performance Section under Verification 

and Validation of Performance Data, and in Appendix 

A: Data Quality Information.

Strategic and Performance 

Planning Framework

The FY 2012 performance planning framework 

originates from the FTC’s Strategic Plan for Fiscal 

Years 2009 to 2014, available at www.FTC.gov/opp/

gpra/spfy09fy14.pdf and is supported by the FTC’s 

Performance Plan, available at www.FTC.gov/opp/

gpra/2013_performance_plan.pdf.

In FY 2012, the FTC released an addendum to the 

strategic plan that included several target increases 

and a minor measure change. The changes have been 

noted in this report next to each measure’s performance 

discussion, as applicable. The addendum is available at 

www.FTC.gov/opp/gpra/spfy09fy14add.pdf.

The FTC began operating under this updated strategic 

plan in FY 2010. The FTC’s work is structured around 

three strategic goals and 13 objectives. Performance 

measures are used to gauge the FTC’s success for each 

objective. The table below describes each element in the 

performance framework.

Strategic Goals

Statements of long-term aims outlined in the Strategic 

Plan, which define how the agency carries out its 

mission.

Objectives Statements of how the FTC plans to achieve the 

strategic goals.

Performance Measures Indicators used to gauge success in reaching strategic 

objectives.

Key Measures

Measures that best indicate whether agency activities 

are achieving the desired outcome associated with the 

related objective.

Targets

Expressions of desired performance levels or specific 

desired results targeted for a given fiscal year. Targets 

are expressed in quantifiable terms.
MANAGEMENT’S DISCUSSION & ANALYSIS

8 Federal Trade Commission | Performance and Accountability Report 

STraTeGic GOalS

(Numbers shown in millons.)

 

 

 

ObjecTiveS

PrOTecT cONSuMerS

Prevent fraud, deception, and u

business practices in the market

gross Costs: 

less earned revenue: 

net Costs: 

nfair 

place.

 $165 

($14)

 $151

Identify fraud, deception, and unfair practices that cause the 

greatest consumer injury.

Stop fraud, deception, unfairness, and other unlawful practices 

through law enforcement.

Prevent consumer injury through education.

Enhance consumer protection through research, reports, 

rulemaking, and advocacy.

Protect American consumers in the global marketplace by 

providing sound policy and technical input to foreign governments 

and international organizations to promote sound consumer policy.

MaiNTaiN cOMPeTiTiON

Prevent anticompetitive mergers 

anticompetitive business practice

marketplace.

gross Costs: 

less earned revenue: 

net Costs: 

and other 

s in the 

$121

($88)

 $33

Take action against anticompetitive mergers and practices that 

may cause significant consumer injury.

Prevent consumer injury through education.

Enhance consumer benefit through research, reports, and advocacy.

Protect American consumers in the global marketplace by 

providing sound policy recommendations and technical advice to 

foreign governments and international organizations to promote 

sound competition policy.

advaNce PerfOrMaNce

Advance the FTC’s performance 

through organizational, individual, and 

management excellence. 

Goal 3’s costs are distributed to Goal 1 and 

Goal 2 predominately by Goal 1’s and Goal 

2’s FTE usage, except for those non-pay 

costs that are clearly attributable to a 

specific goal.

Provide effective human resources management.

Provide effective infrastructure and security management.

Provide effective information resources management.

Provide effective financial and acquisition management.

Performance Measurement Process

Bureau and Office representatives serve as the 

Performance Measure Reporting Officials (PMROs), 

who act as data stewards for each of the agency’s 

publicly-reported performance measures. The PMROs 

report to the Deputy Performance Improvement 

Officer (PIO) on a monthly, quarterly, or annual basis 

via an internal data reporting tool. The Financial 

Management Office (FMO) also leads quarterly 

performance measure reviews that coincide with the 

budget execution reviews. The CFO/PIO, the Executive 

Director/Chief Operating Officer, and the Chief of 

Staff/Chairman are briefed on the results and any 

significant variances in planned versus actual results. 

The PIO and Deputy PIO then coordinate with the 

PMROs on any adjustments to strategies and tactics 

based on the performance results. 
9

MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

The FTC has established performance measures for 

assessing program performance against strategic goal

and objectives. Of the 40 measures, 16 are considere

“key” measures because they best indicate whether 

agency activities are achieving the desired outcome 

associated with the related objective. Additionally, 

four performance measures are considered efficiency 

measures because they are either ratios of outcomes 

to inputs or they capture administrative timeliness. 

For each measure, the FTC has established a 

performance target.

s 

d 

The following table summarizes actual performance 

during FY 2012 against established targets for all of the 

FTC’s key performance and efficiency measures and 

provides a synopsis of related highlights. The table also 

includes actual results from the past three fiscal years. 

The FTC met or exceeded 13 of the 16 key measures 

and two of the four efficiency measures.

leGeNd fOr uPcOMiNG TableS

✔ Signifies that the target is met or exceeded

✖ Signifies that the target is not met

Objective 1.1 identify fraud, deception, and unfair practices that cause the greatest 

consumer injury

key measure 1.1.2 the percentage of the ftC’s consumer protection law enforcement actions that target 

the subject of consumer complaints to the ftC. (output measure)

2012

*Target 70.0% 

of actions

PerfOrMaNce HiGHliGHTS

The FTC and the State of Connecticut temporarily halted 

Leanspa, LLC in November 2011 from allegedly using fake 

news sites to promote their products, making deceptive 

weight-loss claims, and falsely telling consumers they 

could receive “free” trials of acai berry and colon cleanse 

products. The defendants have allegedly taken in more 

than $25 million from consumers in the United States.

* Annual targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

actual

90.6% 

✔

2011 actual

80.4%

✔

2010 actual

95.9%

✔

STRATEGIC GOAL 1: PROTECT CONSUMERS
MANAGEMENT’S DISCUSSION & ANALYSIS

10 Federal Trade Commission | Performance and Accountability Report 

Performance measure 1.2.3: the percentage of redress cases in which the ftC distributes redress dollars 

designated for distribution to consumers within six months. (efficiency measure)

2012

Target 90.0% of 

cases

PerfOrMaNce HiGHliGHTS

The agency returns funds to victims of deceptive 

practices following the successful prosecution of 

defendants that result in judgments or settlements. 

For example, the FTC mailed 12,951 refund checks worth 

95.0% a total of $5 million to consumers who were allegedly 

actual ✔ overcharged by CVS Caremark. In May 2012, the FTC 

accepted a final order against CVS Caremark settling 

charges that it misrepresented the prices of certain 

Medicare Part D prescription drugs, including drugs 

100.0% used to treat breast cancer symptoms and epilepsy. 

2011 actual ✔ The settlement bars deceptive claims related to Medicare 

Part D drug prices and requires CVS Caremark to pay $5 

million to reimburse affected Medicare Part D consumers 

for the price discrepancy.

96.0%

2010 actual ✔

Objective 1.2: Stop fraud, deception, unfairness, and other unlawful practices 

through law enforcement

key measure 1.2.1 the percentage of all cases filed by the ftC that were successfully resolved through 

litigation, a settlement, or issuance of a default judgment. (outcome measure)

PerfOrMaNce HiGHliGHTS

*Target 80.0-90.0% of 

cases

In August 2012, at the request of the Federal Trade 

Commission, a U.S. district court ordered the marketers 

of three get-rich-quick systems, including “John Beck’s 

2012 Free & Clear Real Estate System,” to pay $478 million 

for deceiving close to one million consumers with phony 

claims that they could make easy money using their 

programs. The Order also imposes a lifetime ban that puts 

three of the defendants permanently out of the infomercial 

and telemarketing businesses.

The case is part of the FTC’s ongoing efforts to stop scams 

actual

100.0% 

✔

that prey upon financially distressed consumers. The Order 

2011 actual

100.0% 

✔

represents the largest litigated judgment ever obtained by 

the agency.

* Annual targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

99.2%

2010 actual ✔
11MANAGEMENT’S DISCUSSION & ANALYSIS

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Objective 1.3: Prevent consumer injury through education

key measure 1.3.2 Customer satisfaction rate with an ftC consumer education website or microsite. 

(outcome measure)

2012

Target

Exceed average 

citizen satisfaction 

rate as published in 

the E-Government 

Satisfaction Index.

PerfOrMaNce HiGHliGHTS

The FTC used the American Customer Satisfaction 

Index (ACSI) to measure how satisfied visitors to 

OnGuardOnline.gov are. Over 100 federal agencies 

use this survey to measure customer satisfaction. In 

FY 2012, OnGuardOnline.gov maintained an overall 

customer satisfaction score of 81, well above the 

benchmark score for government websites (74). The 

survey also allows the FTC to measure key website 

elements such as navigation, site information, look 

and feel, site performance and functionality. The 

OnGuardOnline.gov score for each of these elements 

was above the national benchmark for satisfaction. 

In addition, 73% of respondents said the site helped 

them do what they wanted and 54% said they learned 

something on the site that would change their online 

behavior in the future, a strong indication that the site 

is an effective and helpful tool for consumers.

actual

 81

✔

2011 actual

✔

FTC score of 81, 

benchmark score 74

2010 actual

✔

FTC score of 77, 

benchmark score 74

Objective 1.4: enhance consumer protection through research, reports, rulemaking, 

and advocacy

key measure 1.4.4 the percentage of proposed administrative Procedure act (aPa) rulemakings, 

conducted solely by the ftC, completed within nine months of receipt of final comments in the final 

notice of Proposed rulemaking. (efficiency measure)

2012

Target 75.0% of 

rulemakings

PerfOrMaNce HiGHliGHTS

There is no data to consider under this measure, as the 

FTC had no APA rulemakings to consider in FY 2012. 

actual N/A

83.3%

2011 actual ✔

100.0%

2010 actual ✔
MANAGEMENT’S DISCUSSION & ANALYSIS

12 Federal Trade Commission | Performance and Accountability Report 

Objective 1.5: Protect american consumers in the global marketplace by providing 

sound policy and technical input to foreign governments and international 

organizations to promote sound consumer policy

key measure 1.5.1 Policy advice provided to foreign consumer protection and privacy agencies, directly and 

through international organizations, through substantive consultations, written submissions, or comments. 

(output measure)

2012

*Target 60 policy inputs

PerfOrMaNce HiGHliGHTS

An increased focus on Internet policy and consumer 

privacy, both by foreign agencies and by a growing range 

of international organizations, has sustained a strong 

demand for the FTC’s policy advice and technical input 

on consumer policy and related issues. In FY 2012, the 

FTC provided policy advice in over 60 instances, through 

consultations, presentations, and written comments.

*Annual targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

actual

65

✔

2011 actual

52

✔

2010 actual

64

✔
13MANAGEMENT’S DISCUSSION & ANALYSIS

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STRATEGIC GOAL 2: MAINTAIN COMPETITION

Objective 2.1: Take action against anticompetitive mergers and practices that may 

cause significant consumer injury

key measure 2.1.1 actions to maintain competition, including litigated victories, consent orders, 

abandoned transaction remedies, restructured transaction remedies, or fix-it-first transaction remedies 

in a significant percentage of substantial merger and nonmerger investigations. (outcome measure)

2012

Target

40.0–60.0% 

of substantial 

investigations

PerfOrMaNce HiGHliGHTS

The FTC obtained a positive result in 25 of the 58 

significant merger and nonmerger (anticompetitive 

practices) investigations it concluded during FY 2012. 

Actions pertaining to mergers included successful second 

request or compulsory process investigations in a variety 

of matters across various industries: pharmaceuticals 

hospitals, long-term care pharmacies, and physician 

groups, high technology, manufacturing, and energy. 

In regard to anticompetitive practices, the FTC took action 

to stop and prevent anticompetitive tactics that harm 

consumers by thwarting competition. For example, during 

FY 2012, the FTC issued a settlement order prohibiting 

PoolCorp (the U.S.’s largest swimming pool products 

distributor) from restricting the purchase or sale of pool 

products to any other distributor. Additionally, the FTC 

successfully concluded its litigation against Realcomp II 

Ltd. (a Michigan-based realtor group) and Realcomp’s 

policy of blocking nontraditional, low-cost listings from 

being published through its realtor data service.

actual

 43.1%

✔

2011 actual

 34.1%*

✖

2010 actual

40.0%

✔

*This is a correction to results reported in the FY 2011 PAR. 

The results should have been based on 15 out of 44 cases, 

or 34%. The FY 2011 PAR reports actuals on 14 of 44 cases, 

or 32%.
MANAGEMENT’S DISCUSSION & ANALYSIS

14 Federal Trade Commission | Performance and Accountability Report 

Performance measure 2.1.4 Consumer savings of at least six times the amount of ftC resources allocated 

to the merger program. (efficiency measure)

*Target 1300.0% PerfOrMaNce HiGHliGHTS

During FY 2012, the agency saved consumers 

2012 approximately 13 times the amount of resources devoted 

1,492.4% to the merger program, as calculated using the five-year 

actual ✔ average consumer savings obtained under Performance 

Measure 2.1.2 ($504.9 million) divided into the amount of 

resources used in the merger program.

* Annual targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

** This is a correction to results reported in the FY 2011 PAR. 

The results should have been based on a savings of $532.2 

(million), or 1419%. The FY 2011 PAR reports savings of 

$531.5 (million), or 1417%.

2011 actual

1,419.2%** 

✔

2010 actual

1,670.0%

✔

Performance measure 2.1.7 Consumer savings of at least four times the amount of ftC resources allocated 

to the nonmerger program. (efficiency measure)

2012

*Target 2000.0%

PerfOrMaNce HiGHliGHTS

During FY 2012, as in 2011 and FY 2010 where the agency 

greatly exceeded its target, the agency saved consumers 

over 18 times the amount of resources devoted to the 

nonmerger enforcement program. This is largely attributable 

to the consumer savings from one particular case from FY 

2010 involving Intel Corporation. The targets for FY 2012 

through FY 2014 were modified in response to the agency 

greatly exceeding the target due to this case. Therefore, 

subsequent years’ results may not meet the target under this 

measure. The FTC will consider whether the new targets were 

appropriately set.

* Annual targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

actual

1,831.7%

✖

2011 actual

1917.7% 

✔

2010 actual

2,418.0% 

✔
15MANAGEMENT’S DISCUSSION & ANALYSIS

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Objective 2.2: Prevent consumer injury through education

key measure 2.2.1 Competition resources accessed via the ftC’s website. (output measure)

2012

*Target 24.0 million hits

PerfOrMaNce HiGHliGHTS

The FTC is committed to developing readily-available 

online competition content. Through its online 

presence, the FTC strives to provide content to 

serve its stakeholders, whether they are individual 

consumers, affected businesses, researchers, or 

practitioners and policy makers. During FY 2012, the 

FTC’s online competition resources registered over 

23 million hits. These resources include pages that 

relate to individual investigations (such as complaints, 

orders, comments, and press releases), policy and 

research oriented content (such as reports, policy 

guides, and fact sheets, workshop or conference 

webpages, the online competition enforcement 

database, advocacy filings, and amicus briefs), and 

business and consumer education material.

In FY 2011, the agency exceeded the target on this 

measure. Accordingly, new targets were set for FY 

2012 through FY 2014 based on past performance. 

The FTC will consider whether the new targets were 

appropriately set.

actual

23.2 million hits

✖

2011 actual

22.6 million hits

✔

2010 actual

21.5 million hits

✔

* Annual targets for FY12 - FY14 were increased based 

on projected future performance as reported in the 

FTC’s FY 2012 Strategic Plan Addendum.

Objective 2.3: enhance consumer benefit through research, reports, and advocacy

key measure 2.3.1 workshops, seminars, conferences, and hearings convened or cosponsored that involve 

significant competition-related issues. (output measure)

2012

Target

4 workshops, 

seminars, conferences, 

and hearings

PerfOrMaNce HiGHliGHTS

The FTC devotes resources to the creation of 

workshops, conferences, and hearings to foster 

an environment of discussion and analysis of 

competition-related issues. In FY 2012, the FTC held 

three major conferences, one of which was held 

jointly with the Department of Justice.

Of note was the Federal Trade Commission’s 

Microeconomics Conference, a conference held 

annually in November, which brought together 

researchers from universities throughout the world, 

other government agencies, and other organizations 

to discuss antitrust, consumer protection, and policy 

issues that the economists in the FTC’s Bureau of 

Economics encounter. 

Another highlight was a joint conference with the 

Department of Justice’s Antitrust Division held in 

September 2012 on most-favored-nation clauses 

(MFNs), which explored the use of MFN clauses and 

the implications for antitrust enforcement and policy.

actual

 3

✖

2011 actual

4

✔

2010 actual

6

✔
MANAGEMENT’S DISCUSSION & ANALYSIS

16 Federal Trade Commission | Performance and Accountability Report 

key measure 2.3.2 reports and studies issued on key competition-related topics. (output measure)

PerfOrMaNce HiGHliGHTS

Target 8 reports and 

studies A key component to the FTC’s competition related 

strategy objective is studying and issuing working papers 

2012 on competition-related topics. During FY 2012, the FTC 

published working papers on the economics of competition, 

actual

9

✔

market structures, and organizational form. The FTC also 

published reports covering health care and energy topics. 

Additionally, the agency filed two annual reports, one 

recognizing the agency’s continued efforts to protect 

11 consumers and competition, and the Hart-Scott-Rodino 

2011 actual ✔ Annual Report on the premerger notification program and 

merger enforcement.

9

2010 actual ✔

key measure 2.3.3 advocacy comments and amicus briefs on competition issues filed with entities 

including federal and state legislatures, agencies or courts. (output measure)

PerfOrMaNce HiGHliGHTS

*Target 10 comments 

and briefs In FY 2012, the FTC filed advocacy comments and amicus 

briefs on a wide variety of competition issues such as 

2012 pay-for-delay pharmaceutical settlements, the regulation 

of medical, dental, and veterinary professionals, the 

actual

18 

✔

intersection of competition and intellectual property law, 

electricity, and the agency’s Funeral Rule.

*Annual targets for FY12 - FY14 were increased based on 

2011 actual

16 

✔

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

17 

2010 actual ✔
17MANAGEMENT’S DISCUSSION & ANALYSIS

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Objective 2.4: Protect american consumers in the global marketplace by providing 

sound policy recommendations and technical advice to foreign governments and 

international organizations to promote sound competition policy

key measure 2.4.1 Policy advice provided to foreign competition agencies, directly and through 

international organizations, through substantive consultations, written submissions, or comments. 

(output measure)

PerfOrMaNce HiGHliGHTS

*Target 60 policy inputs The FTC’s policy advice remains highly regarded and sought 

2012 after by new and more experienced competition agencies, 

including in international fora. In FY 2012, the FTC provided 

policy advice to foreign competition agencies in over 100 

instances through consultations, written submissions, or actual

146 

✔

comments.

* Annual targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s FY 

2012 Strategic Plan Addendum.

2011 actual

112 

✔

76

2010 actual ✔

STRATEGIC GOAL 3: ADVANCE PERFORMANCE

Objective 3.1: Provide effective human resources management

key measure 3.1.2 the extent employees think the organization has the talent necessary to achieve 

organizational goals. (outcome measure)

2012

Target

Exceed the 

government-wide 

results on the Federal 

Human Capital 

Survey’s Talent 

Management Index

PerfOrMaNce HiGHliGHTS

The Federal Human Capital Survey includes 98 questions 

that measure how effectively agencies manage their 

workforces. The FTC was at least five points higher than 

the government-wide average on 65 of the 98 questions, 

and only one item fell more than five points below the 

government-wide average on any question. In Talent 

Management, the government-wide results were 59% and 

the FTC received 70%, which is third place compared to 

37 other departments and agencies with more than 1,000 

full-time employees.

actual ✔

2011 actual ✔

2010 actual ✔
MANAGEMENT’S DISCUSSION & ANALYSIS

18 Federal Trade Commission | Performance and Accountability Report 

Objective 3.2: Provide effective infrastructure and security management

key measure 3.2.1 a favorable Continuity of operations (CooP) rating. (output measure)

PerfOrMaNce HiGHliGHTS

Target 75.0% rating The FTC participated in the government-wide Eagle 

Horizon Exercise to test and verify the effectiveness of 

2012 the FTC COOP. The FTC’s overall score of 90% for the 

actual

90.0%

✔

Eagle Horizon 2012 Exercise reflects the strong overall 

commitment and continued support of the FTC COOP. 

This score was the highest achieved by the FTC for any 

previous COOP testing exercise conducted by the Federal 

Emergency Management Agency (FEMA). Continued 

2011 actual

75.0% 

✔

efforts to better define the FTC’s essential functions and 

ensure that effective procedures are in place are reflected in 

the outstanding overall exercise score.

85.0% 

2010 actual ✔

key measure 3.2.2 availability of information technology systems. (outcome measure)

PerfOrMaNce HiGHliGHTS

Target 99.00% system 

availability In FY 2012, the information technology services pool 

averaged 99.86% availability, exceeding the target.

2012

99.86%

actual ✔

99.82% 

2011 actual ✔

99.77%

2010 actual ✔
19MANAGEMENT’S DISCUSSION & ANALYSIS

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Objective 3.3: Provide effective information resources management

key measure 3.3.1 the percentage of Commission-approved documents in the ftC’s ongoing and newly 

initiated proceedings available via the internet within 15 days of becoming part of the public record. 

(output measure)

PerfOrMaNce HiGHliGHTS

Target 80.0% rating Making public documents easily available on the 

public FTC website in a timely manner increases public 

2012 awareness of the FTC’s activities. Examples of public 

actual

80.2%

✔

documents approved by the FTC and placed on the 

website include (1) complaints and the FTC’s opinions and 

orders filed in adjudicative proceedings; (2) the Federal 

Register notices in rulemaking, guide issuance, regulatory 

review, consent agreement, and other proceedings in 

2011 actual

82.0%

✔

which the FTC solicits public comments; (3) reports by 

the FTC and its staff; (4) advocacy filings; (5) final consent 

orders and accompanying complaints; and (6) the FTC’s 

complaints, briefs, and proposed orders filed in federal 

court litigation.

In FY 2012, the agency posted 80.2% of documents 

tracked under this measure on the FTC’s public website 2010 actual within 15 days of becoming part of the public record.

93.8%

✔

Objective 3.4: Provide effective financial and acquisition management

key measure 3.4.2 the percentage of Bureaus/offices that establish and maintain an effective, risk-based 

internal control environment. (outcome measure)

2012

Target 100.0% PerfOrMaNce HiGHliGHTS

The Statements of Assurance submitted by the agency’s 

major components provide the basis for measuring the 

100.0% effectiveness of the agency’s risk-based internal control 

actual ✔ environment. Based on these Statements of Assurance, 

100% of the major components establish and maintain an 

effective, risk-based internal control environment.

100.0% 

2011 actual ✔

100.0% 

2010 actual ✔

Performance Measures Summary

The Performance Measure Summary Table in the 

Performance Section of this report shows actual 

results for all performance measures and shows unit 

of measure. Of the 40 total performance measures, 21 

were exceeded, 8 were met, 9 were not met, and data 

was not available for 2 measures. Based on these results, 

the FTC has made significant progress toward reaching 

its objectives, as fully described in the Performance 

Section.
MANAGEMENT’S DISCUSSION & ANALYSIS

20 Federal Trade Commission | Performance and Accountability Report 

The FTC stands prepared to face the challenges of 

today’s marketplace as a champion for consumers 

and competition. As a small law enforcement agency 

with a broad mandate, many of the FTC’s challenges

are defined by the conditions of the marketplace, an

thus are ever changing. For example, as consumers 

and businesses encounter difficulties with financial 

scams, deceptive or fraudulent advertising, online 

privacy and data security, and anticompetitive busine

practices in the technology, health care and other 

industries, the FTC steps forward to protect consum

and maintain competition. Agency management has 

identified significant mission challenges in Strategic 

Goal 1 (Protect Consumers) and Strategic Goal 2 

(Maintain Competition). Management’s identification

was performed separately from the Inspector Genera

(IG) assessment of management and performance 

challenges (see the Other Accompanying Informatio

Section). However, because management concurs wit

the IG assessment, certain aspects of the challenges 

described below are also addressed by the IG. Agenc

mission challenges are presented below as they relate

to the agency’s strategic goals. A reference to the 

most applicable strategic objectives is also provided 

so that readers may refer to descriptions of related 

performance targets and actual results listed by objec

within the Performance Section.

Strategic Goal 1: Protect 

Consumers: Prevent Fraud, 

Deception, and Unfair Business 

Practices in the Marketplace

Under the Protect Consumers goal, the FTC will 

continue to give priority to addressing the following 

challenges: protecting consumer privacy and improvi

data security, stopping harmful uses of technology, 

promoting compliance in new media, protecting 

vulnerable Americans from fraud, protecting 

consumers in the financial services marketplace, 

combating identity theft, targeting deceptive advertisi

affecting consumers’ health, protecting children in th

marketplace, and evaluating environmental marketing

claims.

d 

ss 

ers 

l’s 

n 

h 

y 

tive 

ng 

ng 

e 

PROTECTING CONSUMER PRIVACY AND 

IMPROVING DATA SECURITY: 

The FTC will continue to take a leading role in efforts 

to protect consumers from unfair, deceptive, or other 

illegal practices related to their privacy, while preserving 

the many benefits that technological advances offer. 

The agency will stop unfair and deceptive consumer 

privacy and data security practices through law 

enforcement. It will promote stronger privacy 

protections through policy initiatives on a range 

of topics such as data brokers, mobile devices, and 

comprehensive online data collection. The FTC will 

also participate in interagency groups, promote selfregulatory efforts, provide technical assistance to 

the Congress on draft legislation, and participate in 

international privacy initiatives. (Objectives 1.1, 1.2, 1.3, 

and 1.4)

STOPPING HARMFUL USES OF 

TECHNOLOGY: 

Technology provides countless benefits to consumers, 

including choice, convenience, and increased access 

to goods, services, and information. It also enables, 

however, new vehicles for fraudulent, deceptive, and 

unfair practices in the marketplace. If consumers are 

not adequately protected, not only can they suffer 

economic injury, but they can lose confidence in these 

new technologies. To respond to these challenges, 

the FTC will examine malware and spyware threats 

to mobile devices, promote technologies to protect 

consumers online, and target online and mobile threats 

for enforcement, including mobile spam, mobile 

cramming, deceptive and unfair apps, and malware 

distributed through social networks. 

Technological advances have made it difficult for 

consumers and law enforcement to identify the location 

of fraudsters pitching scams over the telephone. Some 

companies remain virtually anonymous by falsifying 

the phone number on a caller ID display. At the same 

time, technology has made it cheap and efficient to 

make large numbers of illegal pre-recorded calls, often 

from overseas. The FTC will continue to take aggressive 

law enforcement action to stop illegal “robocalls” 

AGENCY MISSION CHALLENGES
21MANAGEMENT’S DISCUSSION & ANALYSIS

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that deliver prerecorded messages and to halt other 

telemarketing calls that violate the National Do Not 

Call Registry. Further, the FTC will work with 

consumer groups, legitimate industry, technologists, 

policymakers, and other stakeholders to develop 

solutions to the rise in illegal robocalls. (Objectives 1.1, 

1.2, 1.3, and 1.4)

PROMOTING COMPLIANCE IN NEW 

MEDIA:

As new media open new avenues for companies to 

communicate with consumers, the FTC will promote 

compliance. The agency will conduct outreach to 

businesses that engage in viral, mobile, and affiliate 

marketing, stressing that existing advertising principles 

apply to new media and methods of marketing. The 

FTC will also monitor the marketplace and initiate 

investigations where appropriate. (Objectives 1.1, 1.2, 

1.3, and 1.4)

PROTECTING VULNERABLE 

AMERICANS FROM FRAUD:

Frauds such as those offering health insurance or 

income opportunities through jobs, investment, 

government grants, or other scams affect everyone 

but pose an even greater risk to those from poor and 

underserved communities. The FTC will continue to 

combat such frauds. The FTC also will work to protec

vulnerable consumers from deceptive work-at-home, 

get-rich-quick, and related schemes, including promises

of non-existent jobs and phony government grants. It 

also will combat fraud targeting seniors and examine 

ways to better assist older victims. (Objectives 1.1, 1.2, 

1.3, and 1.4)

PROTECTING CONSUMERS IN THE 

FINANCIAL SERVICES MARKETPLACE: 

Fraud operators have seized upon new schemes to 

take advantage of consumers in the financial services 

marketplace. The FTC will continue to use the tools 

and authorities available to it to protect consumers 

of financial services. Agency law enforcement actions 

will target firms that make deceptive offers to assist 

consumers in reducing or renegotiating secured debt, 

such as mortgage or car loans, and unsecured debt, suc

as credit card bills. The FTC will work to stop payday 

lending operations that employ deceptive conduct to 

take advantage of financially distressed consumers 

t 

h 

seeking these loans. The FTC will combat deceptive 

and other illegal practices involving mortgage 

advertising, servicing, lending, and other financial 

services. These practices can have severe consequences 

for consumers, including unanticipated high-cost 

mortgages, ruined credit histories, and loss of their 

homes. The agency also will fight deceptive and abusive 

debt collection practices. The FTC will continue to 

gather information on the consumer protection issues 

related to buying or leasing motor vehicles, and when 

appropriate, take action against deceptive practices in 

this area. The FTC will also continue to work to protect 

consumers from financial frauds that emanate from 

outside the United States, including phantom payday 

loan scams and fake mortgage relief scams. Further, 

the FTC will continue to closely coordinate with the 

Consumer Financial Protection Bureau to ensure that 

consumers are protected in the financial marketplace 

and to avoid any duplicative efforts between the 

agencies. (Objectives 1.1, 1.2, 1.3, and 1.4)

COMBATING IDENTITY THEFT: 

Identity theft exacts a heavy financial and emotional 

toll from its victims, and the FTC will continue to 

assist the millions of Americans who are victimized 

each year. The FTC will continue to be the repository 

for identity theft complaints and make them available 

to federal criminal law enforcement agencies. Our 

trained counselors will continue to advise identity theft 

victims who call our toll free number about rights 

and remedies available to them under federal law. The 

agency also will publicize its victim assistance guide for 

pro-bono attorneys, train local law enforcement to spot 

and prosecute identity theft, and update educational 

materials to address new and emerging issues, such as 

medical and children’s identity theft. (Objectives 1.1, 1.2, 

1.3, and 1.4)

TARGETING DECEPTIVE ADVERTISING 

AFFECTING CONSUMERS’ HEALTH: 

Consumers can fall prey to fraudulent health advertising 

when they are desperate for medical help. The 

FTC, therefore, will continue to challenge deceptive 

advertising of health products. The agency will focus on 

disease prevention and treatment claims; claims aimed 

at baby boomers, seniors, and the uninsured; and claims 

exploiting emerging health threats. (Objectives 1.1, 1.2, 

1.3, and 1.4)
MANAGEMENT’S DISCUSSION & ANALYSIS

22 Federal Trade Commission | Performance and Accountability Report 

PROTECTING CHILDREN IN THE 

MARKETPLACE:

Children and teens are particularly vulnerable to 

deceptive, unfair, and age-inappropriate advertising. 

The agency is conducting a review of the Children’s 

Online Privacy Protection Act (COPPA) Rule that 

requires websites to get verifiable parental consent 

before collecting information from children under 13

years old. Agency staff is assessing new technologies, 

including mobile applications, to determine whether 

they are encompassed by, and conducted in accordan

with, COPPA’s parameters. In the alcohol advertising 

arena, the FTC plans to propose improvements to 

self-regulatory standards, bring enforcement actions 

targeting unfair or deceptive practices, and issue anot

report to the Congress on self-regulation. Further, 

the agency will monitor the marketing of violent 

entertainment to children and the ability of teens und

age 17 to purchase age-restricted products containing

ce 

her 

er 

violent content. (Objectives 1.1, 1.2, 1.3, and 1.4)

EVALUATING ENVIRONMENTAL 

MARKETING CLAIMS: 

Green claims, such as carbon offset, renewable 

material, and renewable energy claims, have increased 

in popularity. These claims can be extremely useful 

for consumers; however, the complexity of the issues 

involved creates the potential for confusing, misleading, 

and fraudulent claims. In October 2012, the FTC 

revised and updated the “FTC Guides for the Use of 

Environmental Marketing Claims,” commonly known as 

the Green Guides. The agency will bring cases and law 

enforcement sweeps to address deceptive environmental 

marketing claims, working where possible with state and 

local partners. (Objectives 1.1, 1.2, 1.3, and 1.4)
23MANAGEMENT’S DISCUSSION & ANALYSIS

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Strategic Goal 2: Maintain 

Competition: Prevent 

Anticompetitive Mergers and 

Other Anticompetitive Business 

Practices in the Marketplace

Under the Maintain Competition goal, the FTC will 

continue to give priority to the challenges of promoti

competition and preventing anticompetitive activity 

in the health care and pharmaceutical industries, high 

technology sectors, and energy industries. The agency

will also work on promoting sound competition polic

at the international level and advocating for competiti

before the U.S. courts, legislatures, and government 

agencies.

PROMOTING COMPETITION 

IN HEALTH CARE AND 

PHARMACEUTICALS: 

The rapidly rising cost of health care, which continue

to account for an increasingly significant share of the

gross domestic product, is a matter of concern for 

consumers, employers, insurers, and the nation as a 

whole. To ensure that consumers receive the benefits 

of competition in health care, the FTC has made 

antitrust enforcement in this area a priority. Pay-fordelay patent settlement agreements between brand 

and generic drug manufacturers to delay generic 

competition are causing consumers significant harm 

because they deprive consumers of access to lower 

cost generic drugs. According to FTC economists, 

these anticompetitive deals, unless stopped, will cost 

consumers $35 billion over ten years. When appropri

the FTC investigates and challenges patent settlement

between brand and generic companies and supports 

legislation to eliminate this problem. The agency also 

addresses rising prescription drug prices by monitorin

pharmaceutical and medical device company mergers.

In addition, the FTC stops anticompetitive agreement

between physicians and hospital service organizations

and monitors hospital and other mergers that may rai

the cost of health care. The agency issues guidance 

about antitrust law to prevent groups of health 

care providers from creating and exercising market 

power, which undermines efforts to improve quality 

and control costs. The FTC focuses these efforts so 

that misunderstandings about the law do not deter 

potentially beneficial collaborations among health 

ng 

y 

on 

s 

ate, 

s 

g 

s 

se 

care competitors. The Affordable Care Act of 2010 

encourages healthcare providers to create integrated 

health care delivery systems, called Accountable Care 

Organizations, to improve the quality of care and lowe

health care costs. The FTC worked with the other 

relevant U.S. agencies (the Antitrust Division of the 

Department of Justice and the Centers for Medicare 

and Medicaid Services) to develop a Joint Statement 

of Antitrust Enforcement Policy for Accountable Car

Organizations, which makes clear that the antitrust 

laws are not a barrier to bona fide collaboration to 

improve healthcare and reduce costs. Upon request, 

FTC staff reviews certain proposed ACOs. The FTC 

retains the ability to challenge collaborations that are 

anticompetitive. (Objectives 2.1, 2.2, and 2.3)

CONTINUING EMPHASIS ON HIGH 

TECHNOLOGY: 

The continuing importance of technology is a 

crucial marketplace challenge that is placing greater 

demands on antitrust enforcement. The FTC antitrust 

investigations increasingly involve high-technology 

sectors of the economy. In enforcing the antitrust laws

the FTC analyzes mergers and acquisitions filed under 

the Hart-Scott-Rodino (HSR) Act, and also monitors 

the industry for non-reportable transactions that might

raise antitrust concerns. The FTC takes action against 

those mergers that are likely to reduce or eliminate 

competition in the high technology sector. In addition,

the FTC is vigilant where a firm may be illegally using 

a dominant market position to stifle competition and 

strengthen an existing monopoly in order to raise price

reduce the quality or choice of goods and services, 

or reduce innovation. Furthermore, issues in antitrust 

matters increasingly intersect with intellectual property

concerns, raising difficult questions about how to 

harmonize these two bodies of law. (Objective 2.1 

and 2.3)

PREVENTING ANTICOMPETITIVE 

ACTIVITY IN ENERGY INDUSTRIES: 

The price of gasoline and other energy sources 

continues to be a great concern for consumers, 

businesses, and governments. The agency meets this 

challenge by closely monitoring gasoline markets and 

moving quickly to address any anticompetitive merger 

or nonmerger activity. Through its review of HSR 

merger filings and investigation of non-reportable 

transactions, the FTC protects consumers in these 

r 

e 

, 

s, 
MANAGEMENT’S DISCUSSION & ANALYSIS

24 Federal Trade Commission | Performance and Accountability Report 

markets. The FTC also continuously examines price 

movements and other activity through its Gasoline and 

Diesel Price Monitoring Project to identify any conduct 

that may not reflect purely competitive decisions based 

on the forces of supply and demand. The FTC also 

monitors energy markets for anticompetitive nonmerger 

activity such as illegal agreements among competitors, 

agreements between manufacturers and product dealers, 

monopolization, and other anticompetitive activities. 

The FTC continues to investigate whether certain oil 

producers, refiners, transporters, marketers, physical or 

financial traders, or others (1) have engaged in practices, 

including manipulation, that have lessened or may lessen 

competition in the production, refining, transportation, 

distribution, or who

petroleum products

misleading informat

lesale supply of crude oil or 

; or (2) have provided false or 

ion related to the wholesale price of 

crude oil or petroleum products to a federal department 

or agency. Such actions could violate Section 5 of the 

FTC Act, the Commission’s Prohibition of Energy 

Market Manipulation Rule, or Section 811 or Section 

812 of the Energy Independence and Security Act 

of 2007. To prepare and support agency staff in 

meeting these challenges, the FTC devotes considerable 

resources to monitoring and studying energy markets—

often in response to congressionally mandated 

requirements—thus developing the professional 

expertise and body of knowledge needed to address 

emerging concerns. The FTC has issued reports on 

the factors that influence the prices that American 

consumers pay for gas. These reports, the most recent 

of which was released in 2011, show that the price 

of oil is still the most important factor in gas prices. 

(Objectives 2.1 and 2.3)
25MANAGEMENT’S DISCUSSION & ANALYSIS

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MANAGEMENT 

ASSURANCES

(On Internal Controls, Financial 

Systems, and Compliance with 

Laws and Regulations) 

IMPLEMENTATION OF THE FEDERAL 

MANAGERS’ FINANCIAL INTEGRITY 

ACT (FMFIA) AT THE FTC

The FTC considers internal controls to be an integral 

part of all systems and processes that the agency utiliz

in managing its operations and carrying out activities 

toward achieving strategic goals and objectives. The 

FTC holds agency managers accountable for efficientl

and effectively performing their duties in compliance 

with applicable laws and regulations and for maintaini

the integrity of their activities through the use of 

controls. 

The FTC’s Senior Assessment Team (SAT) provides 

strategic direction and oversight over the agency’s 

internal control program, to promote and facilitate 

compliance with applicable guidance (e.g., Office of 

Management and Budget [OMB] Circular A-123, 

“Management’s Responsibility for Internal Control”), 

and communicates the results of reviews to senior 

management and the head of the agency.

Some of the functions of the SAT are developing and 

documenting an internal control review plan, identifyi

key processes and related control activities, performin

a preliminary risk assessment of such processes, 

reviewing and assessing the overall control environme

ensuring timely implementation of any corrective 

actions needed to address identified weaknesses, 

and establishing guidance for program managers in 

monitoring and assessing management controls within

their areas of responsibility. 

es

y 

ng

ng

g 

nt, 

During FY 2012, the SAT updated guidance 

for program managers to use in completing selfassessments of the processes and controls within their 

areas of responsibility. Senior managers throughout the

agency completed self-assessments that disclosed no 

significant control weaknesses. The SAT evaluated the 

results of the managers’ assessments and concurred 

that no material weaknesses or nonconformances were 

identified. The results of these evaluations and other 

information—such as independent audits or reviews 

performed by the Office of Inspector General (OIG) 

and the Government Accountability Office (GAO) (e.g.

Federal Information Security Management Act review), 

independent audits of service providers’ operations 

and financial systems (e.g., reviews conducted in 

accordance with Statement on Standards for Attestatio

Engagements (SSAE) No. 16), internal analyses, and 

other relevant evaluations and control assessments—

were considered by the SAT and the agency head in 

determining whether there are any management control

deficiencies or nonconformances that must be disclose

in the annual assurance statement. 

In FY 2012, the FTC continued to follow its Internal 

Control Review Plan established in FY 2010 to conduct

internal control reviews of agency bureaus and offices 

at least once every three years. The objective of the 

reviews is to assist management in identifying highrisk areas and implement appropriate risk management 

strategies where necessary. Three additional reviews 

were initiated or underway this year. The Chairman’s 

assurance statement that follows is supported by the 

processes and reviews described above, which were 

carried out in FY 2012. Management assurances tables 

appear in the Other Accompanying Information 

Section.

, 

n 

d 
MANAGEMENT’S DISCUSSION & ANALYSIS

26 Federal Trade Commission | Performance and Accountability Report 

CHAIRMAN’S FMFIA STATEMENT OF ASSURANCE
27MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

SUMMARY OF MATERIAL WEAKNESSES 

AND NONCONFORMANCES

As noted in the Chairman’s FMFIA Statement of 

Assurance, the FTC has no material weaknesses or 

nonconformances to report for FY 2012. No new 

material weaknesses or significant nonconformances 

were identified for the past eight years, nor were there 

any existing unresolved weaknesses requiring corrective 

action.

FEDERAL INFORMATION SECURITY 

MANAGEMENT ACT (FISMA)

As mandated by FISMA, the agency continues to 

maintain an information security program to manage 

information technology in accordance with National 

Institute of Standards and Technology (NIST) 

requirements. Continuous monitoring is one of many 

approaches that the FTC employs to protect agency 

information systems and the data that is collected, 

stored, and transmitted during the course of business. 

The Office of the Chief Information Officer (OCIO) 

continues to protect agency information 

and information assets by:

• Participating in the Department of Homeland 

Security (DHS) Cyber Assurance Program (CAP). 

The FTC participates in the DHS Cyber Hygiene 

program that assesses and validates the FTC’s 

external network for known vulnerabilities and 

configuration errors. DHS provides the FTC with a

full report of weaknesses and suggested mitigations

• Deploying redundant networking capabilities at 

FTC Regional Offices. During FY 2012, bandwidth

upgrades and redundant communication links 

have been completed. This change facilitates 

the movement of data to and from the regional 

offices while reducing the possibility of network 

disruptions.

• Moving the FTC’s public-facing websites to offsite hosting facilities. The FTC has contracted with 

a GSA Certified Cloud Provider (CSP) to host all 

FTC public websites, and will benefit from the 

increased availability and scalability the solution 

provides. Additionally, the FTC is compliant with 

the “cloud first” mandate as required by the “25 

Point Implementation Plan to Reform Federal 

Information Technology Management.”

. 

Additionally, the FTC has performed four Assessing 

and Authorizing (A&A) efforts and currently has twent

one systems authorized to operate. 

DEBT COLLECTION IMPROVEMENT 

ACT

The Debt Collection Improvement Act of 1996 

prescribes standards for the administrative collection, 

compromise, suspension, and termination of federal 

agency collection actions and referrals to the proper 

agency for litigation. The FTC monitors, administers 

and collects on debts less than 180 days delinquent. 

All eligible debts more than 180 days old have been 

transferred to the U.S. Department of the Treasury 

for cross-servicing. In addition, recurring payments 

were processed by Electronic Funds Transfer (EFT) 

in accordance with the EFT provisions of the Debt 

Collection Improvement Act.

PROMPT PAYMENT ACT

The Prompt Payment Act requires federal agencies to 

make timely payments to vendors, including any interes

penalties for late invoice payments. In FY 2012, the 

FTC processed 13,850 invoices totaling nearly 

$89 million that were subject to prompt payment. 

Of these invoices, 99.5 percent were paid on time. 

During FY 2012, the FTC paid a total of $1,949 in 

interest penalties, or .002 percent of the total dollar 

amount invoiced.

AGENCY FINANCIAL MANAGEMENT 

SYSTEMS STRATEGY

The FTC’s overall strategy for its financial management

systems framework is driven by the objectives of 

operational effectiveness and efficiency, reliability and 

timeliness of data, and support of requirements of the 

agency’s strategic goals. The agency continues to work 

with its shared service provider in enhancing its Core 

Financial System (CFS) and the related feeder systems 

and business processes. In FY 2012, the FTC upgraded

its Oracle-based CFS to Release 12, which has provided

operational efficiencies through a new centralized rules

based accounting engine.

The FTC also plans to fully integrate its procurement 

system with its CFS. Such integration will strengthen 

internal controls, improve efficiency of the 

procurement process, and provide agency staff with 

timely information regarding budget execution and the 

availability of funds.

y 

t 

-
MANAGEMENT’S DISCUSSION & ANALYSIS

28 Federal Trade Commission | Performance and Accountability Report 

Introduction 

The financial highlights presented below are an analysis 

of the information that appears in the FTC’s FY 2012 

financial statements. The agency’s financial statements, 

which appear in the Financial Section of this report, are 

audited by an independent accounting firm. The FTC 

management is responsible for the fair presentation 

of information contained in the principal financial 

statements. The financial statements and financial data 

presented below have been prepared from the agency’s 

accounting records in accordance with Generally 

Accepted Accounting Principles (GAAP). GAAP for 

federal agencies are the standards prescribed by the 

Federal Accounting Standards Advisory Board 

(FASA B). For the 16th straight year, the FTC is proud

to have received an unqualified (clean) opinion on our 

audited financial statements. The chart below presents 

a snapshot of the changes in key financial statement li

items that occurred during FY 2012 and is followed by

an explanation of the more significant fluctuations in 

each of FTC’s financial statements.

ne 

Differences between amounts presented in this section and the financial statements are due to rounding.

CONDENSED BALANCE SHEET (Dollars shown in thousands) FY 2012 FY 2011 Percentage

Change

Assets:

 fund balance with treasury $192,786 $112,225 72%

 cash and other monetary assets 28,360 44,944 -37%

 investments - 35,443 -100%

 accounts receivable,net 31,986 11,400 181%

 General property & equipment, net 18,385 19,371 -5%

Total Assets $271,517 $223,383 22%

Liabilities:

 accrued redress receivables due to claimants $27,219 $11,229 142%

 redress collected not yet disbursed 84,935 84,190 1%

 accounts payable and other 30,609 34,768 -12%

Total Liabilities $142,763 $130,187 10%

Net Position:

 cumulative results of operations-other funds 128,754 93,196 38%

Total Net Position $128,754 $93,196 38%

Total Liabilities and Net Position $ 271,517 $223,383 22%

COST SUMMARY (Dollars shown in thousands) FY 2012 FY 2011 Percentage

Change

 Gross costs $286,054 $298,649 -4%

 less: earned revenue (101,619) (106,217) -4%

Net Cost of Operations $184,435 $192,432 -4%
29MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

Financial Analysis

assets. 

The FTC’s Balance Sheet shows total assets of $271 

million at the end of FY 2012, an increase of $48 million 

or 22 percent compared to total assets of $223 million in 

FY 2011. The increase is explained through the analysis 

of the individual asset categories. 

Fund balance with Treasury increased by $80 million, 

due primarily to $45 million in funds being reserved 

for the planned relocation of the FTC offices currently 

at 1800 M Street and 601 New Jersey Avenue and $21 

million that was returned to the FTC’s deposit account 

from its discontinued redress investment account. Cash 

and other monetary assets decreased by $17 million, due 

primarily to the remaining funds of a prior large judgment 

distributed in FY 2012. Accounts receivable, net increased 

by $21 million, which was primarily due to the estimated 

collectability of two large redress judgments and one large 

civil penalty that were incurred in FY 2012. 

Investments decreased by $35 million due to the 

discontinuation of the redress investment account. 

General property & equipment, net decreased as 

depreciation and disposals exceeded capital asset additions 

during the year. These additions included data storage 

expansion and network infrastructure enhancements. 

ASSETS BY TYPE (Dollars shown in millions)

Fund balance with 

treasury, $193

General Property and

equipment, net, $18

Cash and other 

monetary assets, $28

Accounts 

receivable, net, $32

71%

7%

10%

12%
MANAGEMENT’S DISCUSSION & ANALYSIS

30 Federal Trade Commission | Performance and Accountability Report 

Redress collected not yet disbursed is the liability offset 

to collections made on redress cases and is basically 

unchanged from the prior year. $57 million in collections 

is held in the FTC’s deposit account and $28 million in 

collections is held at financial institutions.

Accounts payable and other decreased by $4 million in FY 

2012, due to two obligations totaling $4 million that were 

accrued in FY 2011, but did not incur accruals for FY 

2012.

LIABILITIES BY TYPE (Dollars shown in millions)

Redress collected not yet

disbursed, $85

Accrued redress

receivables due to

claimants, $27

Accounts payable and 

Other, $31

59%

22%

19%
31MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

FY 2012 NET COSTS BY STRATEGIC GOAL

(Dollars shown in thousands)

Strategic Goal 1

Protect Consumers

Strategic Goal 2

Maintain Competition Total

 Gross costs $164,767 $ 121,287 $ 286,054 

 less: earned revenue (13,794) (87,825) (101,619)

Net Cost of Operations $150,973 $ 33,462 $ 184,435 
MANAGEMENT’S DISCUSSION & ANALYSIS

32 Federal Trade Commission | Performance and Accountability Report 

Budgetary resourCes. 

The Statement of Budgetary Resources (SBR) provides 

information on budgetary resources made available 

to the agency and the status of these resources at the 

end of the fiscal year. New budgetary authority (total 

budgetary resources excluding unobligated balances 

brought forward and prior year recoveries) was $313 

million in FY 2012, an increase of $21 million or seven 

percent from the $292 million received in FY 2011. 

The increase in the new budget authority was primarily 

for funding the planned relocation of FTC offices. 

In FY 2012, spending authority derived from offsetting 

collections totaled $103 million ($88 million for HSR 

fees, $14 million for DNC Registry fees and $1 million 

from a federal agency receivable) and general fund 

appropriations totaled $210 million, comprising 33 and 

67 percent of new budget authority, respectively. 

This compares to offsetting collections of $106 million 

and general fund appropriations of $186 million, 

comprising 36 and 64 percent of new budget authority, 

respectively, in FY 2011.

The SBR includes distributed offsetting receipts, which 

are the non-entity and non-budgetary funds recorded in 

the FTC’s miscellaneous receipt account. These receipts 

are composed of disgorgements to the Treasury from 

undistributed funds from the redress program and 

court-appointed receivers. Distributed offsetting receipts 

were $15 million in FY 2012, compared to $13 million 

in FY 2011.

NEW BUDGET AUTHORITY FOR FY 2011 (Dollars shown in millions)

General fund

appropriations, $210

Spending authority 

from ofsetting 

collections, $103

67%

33%
33MANAGEMENT’S DISCUSSION & ANALYSIS

fiscl ye

Limitations of Financial 

Statements

FTC management has prepared its FY 2012 financial 

statements from the books and records of the agency 

in accordance with the requirements of OMB Circular 

A-136, financial reporting requirements, as amended. 

The financial statements represent the financial position 

and results of operations of the agency pursuant 

to the requirements of chapter 31 of the U.S. Code 

Section 3515(b). While these statements have been 

prepared from the agency’s books in accordance with 

the formats prescribed by the OMB, the statements are 

in addition to the financial reports used to monitor and 

control budgetary resources, which are prepared from 

the same books and records. These statements should 

be read with the understanding that they are for a 

component of the U.S. government, a sovereign entity. 

One implication is that unfunded liabilities cannot be 

liquidated without legislation that provides resources to 

do so.

Financial Management Indicators

The following table shows standard indicators 

developed by the Chief Financial Officers Council 

and used by the OMB to monitor agencies’ financial 

management practices.

fiNaNcial MaNaGeMeNT iNdicaTOrS fOr fY 2012

debT MaNaGeMeNT

Debt Transferred to Treasury 100%

fuNdS MaNaGeMeNT

Fund Balance with Treasury (identifies the difference 

between the fund balance reported in Treasury reports 

and the agency fund balance with Treasury recorded 

in its general ledger on a net basis) 

100% reconciled

PaYMeNT MaNaGeMeNT

Percentage Invoices Paid on Time (per Prompt 

Payment Act) 

99.5%

Percentage Interest Penalties Paid to Total Dollars 

Invoiced 

0.002%

Percentage of total dollars outstanding in current 

status* (good standing) for Individually Billed Travel 

Account holders 

100%

Percentage of total dollars outstanding in current 

status* (good standing) for Centrally Billed Travel 

accounts 

100%

Percentage of total dollars outstanding in current 

status* (good standing) for Purchase Cards 

100%
performance section

34 Federal Trade Commission | Performance and Accountability Report 

THIS PAGE INTENTIONALLY LEFT BLANk
fiscal year 2012

performance 

I
performance section

36 Federal Trade Commission | Performance and Accountability Report 

The Performance Section presents, by goals and 

objectives, detailed information on the performance 

results of the Federal Trade Commission’s (FTC) 

programs. This section also includes: a discussion of 

strategies and factors affecting performance, a summa

of methods used to verify and validate performance 

data, trend data, performance targets, and resources 

utilized data for Goal 1 and Goal 2. Since Goal 3 appli

to overall performance across the agency, the resource

utilized for Goal 3 are distributed to Goal 1 and Goal 

21

. This section also contains the results of a program 

evaluation in the Office of International Affairs. 

For a summary of the agency’s mission and a 

description of the organizational structure, see the 

Management’s Discussion and Analysis Section.

The goals, objectives, and performance measures 

reported in this PAR are based on the agency’s 

strategic plan, which became effective in FY 2010. 

In FY 2012 the agency updated the strategic plan 

with an addendum, reflecting interim adjustments 

to several performance measures and targets. 

The performance tables that follow present seven 

fiscal years of performance results and targets, 

except for those performance measures first added 

in the latest strategic plan update. These newest 

performance measures are presented starting in FY 

2010. Measures or performance targets that changed 

as a result of the addendum are noted throughout the 

section where applicable. The addendum to the 

strategic plan is available at 

www.ftc.gov/opp/gpra/spfy09fy14add.pdf.

Relationship of Outputs 

to Outcomes

The FTC continuously reviews its performance 

framework and focuses on tracking and reporting the 

most appropriate and meaningful outcome measures t

show effectiveness, efficiency, and results. For example

outcome-based Performance Measures 2.1.2 and 2.1.5 

estimate the millions of dollars in consumer savings 

1

goal 3’s costs are distributed to goal 1 and goal 2 predominatel

by goal 1’s and goal 2’s fte usage, except for those non-pay cost

that are clearly attributable to a specific goal.

ry 

es 

s 

o 

, 

that result from merger and nonmerger actions taken 

to maintain competition. The FTC, however, has not 

developed outcome measures in all cases, and uses input 

and output measures that either support outcomes, lead 

to outcomes, or otherwise provide valuable indicators 

of how the FTC is progressing toward achieving its 

strategic goals and objectives. Under the consumer 

protection goal, for example, Performance Measure 

1.1.1 counts consumer complaints added to the FTC’s 

database, and Performance Measure 1.1.2 indicates 

the percentage of the agency’s consumer protection 

law enforcement actions that targeted the subject 

of consumer complaints. While these measures are 

not outcome-oriented, they bring the FTC closer to 

determining its role in the ultimate desired outcome 

of a marketplace free of unfair practices that cause 

consumer injury and free of fraud and deception.

Verification and Validation of 

Performance Data

The financial data and performance results described in 

this report enable the FTC to administer its programs, 

gauge their success, and make adjustments necessary to 

improve program quality for the public. The Message 

from the Chairman on p. IV provides that the FTC’s 

financial and performance data presented in this 

report are complete and reliable. New for FY 2012, 

Appendix A provides details on the data quality of 

each performance measure. Additionally, the following 

steps outline how the agency ensures the performance 

information it reports is complete and reliable:

• The FTC has adopted a central internal 

repository for performance data entry, 

reporting and review. The electronic data tool 

reduces human error, increases transparency, 

and increases review by senior management.

• The Office of the Inspector General holds 

annual meetings with BC and BCP to review 

their performance measure methodology and 

analysis. 

INTRODUCTION TO PERFORMANC

y 

s 
37performance section

fiscal year 2012

• The agency has developed policy and 

documented the procedures used to ensure 

timely reporting of complete, accurate, 

and reliable actual results relative to the key 

performance measures.

• The agency holds program managers 

accountable to set meaningful and realistic 

targets that also challenge the agency to lever

its resources. This includes ensuring ongoing 

monitoring of performance targets so they 

are updated to reflect changes in key factors 

that impact the agency’s ability to achieve suc

results. Further, when appropriate, program 

managers are required to explain how they wi

improve performance when targets are not m

• The agency conducts quarterly performance 

measurement reviews with management 

as well as periodic senior management and 

commission review throughout the fiscal year

This process includes substantiating that actu

results reported are indeed correct whenever 

those results reveal significant discrepancies o

variances from the target.

Agency program managers also monitor and maintai

automated systems and databases that collect, track, 

and store performance data, with support provided b

the FTC’s Office of the Chief Information Officer. 

In addition to the general controls in place over the 

network that ensure only authorized staff can access 

key systems, each application (system)—such as the 

Consumer Sentinel Network—incorporates internal 

validation edits to ensure the accuracy of data contai

therein. These application edits include checks for 

reasonableness, consistency, and accuracy. Crosscheck

between other internal automated systems also provi

assurances of data reasonableness and consistency. 

In addition to internal monitoring of each system, 

experts outside of the business units (e.g., the Bureau

of Consumer Protection and Competition) routinely 

monitor the data collection. For example, senior 

economists from the Bureau of Economics review 

statistical data used by the Bureau of Competition to 

calculate performance results. 

The Financial Management Office is responsible for 

providing direction and support on data collection 

methodology and analysis, ensuring that data 

age

h 

ll 

et.

. 

al 

r 

n 

y 

ned

s 

de 

s 

quality checks are in place, and accurately reporting 

performance management data.

Strategic Human Capital 

Management

The FTC’s strategic human capital management 

ensures that the agency has the diverse, skilled 

workforce needed to advance its mission, achieve its 

strategic goals and objectives, and meet performance 

measure targets. The agency conducts human capital 

planning in concert with long-term strategic planning 

and annual performance planning to keep human 

capital goals, policies, programs, and initiatives aligned 

with the strategic and performance plans.

Human capital planning encompasses leadership and 

knowledge management, a results-oriented performanc

culture, talent management, and job satisfaction, which 

are evaluated annually by the U.S. Office of Personnel 

Management’s Employee Viewpoint Survey. More 

detailed information on human capital performance 

goals and results are provided on page 94.

Program Evaluation: ASEAN 

Competition and Consumer 

Protection Program 

The Association of Southeast Asian Nations 

(ASEAN) Competition and Consumer Protection 

Program, funded by the U.S. Agency for International 

Development (USAID) and implemented by the FTC 

and the Department of Justice, provided technical 

assistance to ASEAN and certain of its member states 

to develop sound competition and consumer protection

policy and law enforcement capacity. USAID found 

that the Program was very effective, especially in 

Vietnam, and was well utilized by institutions such 

as the Vietnam Competition Authority (VCA) and 

the ASEAN Secretariat. Particular strengths of the 

project that were identified included the utilization of 

internal U.S. government technical expertise; the use 

of a regional approach, in this case by working through 

ASEAN to institutionalize competition policy and law 

as a key ASEAN objective; using that to garner interest 

and create multilateral pressure for the adoption of 

international best practices in the field; and the costeffective combination of different technical assistance 

mechanisms such as resident advisors, training, and 

e 
performance section

38 Federal Trade Commission | Performance and Accountability Report 

workshops, and an internship/fellowship opportunity at 

the FTC.

Providing technical assistance to develop effective 

competition and consumer protection law and policy 

in less developed countries is important because 

competition and consumer protection law and policy 

can enhance consumer welfare by facilitating lower 

prices, market entry, consumer choice, and innovation. 

Sound competition enforcement also helps realize the 

goals of trade agreements by helping define the “rules 

of the game” for foreign investors and providing 

some assurance that competition law will not be used 

to punish successful businesses or protect domestic 

interests.

In addition to the high marks given to the Program 

by its recipient institutions, evidence of beneficial 

impact at the outcome level is provided by the World 

Economic Forum’s Global Competitiveness Index, 

in which Vietnam improved its rank for “Effectiveness 

of Anti-Monopoly Policy” from 100th out of 131 

countries in 2007-2008 when the ACCP first began its 

focus there, to 58th out of 139 countries in the 

2010-2011 rankings. However, other variables that 

effective competition policy is expected to affect, 

including scores for “intensity of local competition,” 

remained largely unchanged in Vietnam over that 

period.

leGeNd fOr uPcOMiNG PerfOrMaNce SecTiON TableS 

✔ Signifies that the target is met or exceeded

✖ Signifies that the target is not met
39performance section

fiscal year 2012

Objective 1.1 identify fraud, deception, and unfair practices that cause the greatest 

consumer injury

Performance measure 1.1.1 Complaints collected and 

entered into the Consumer Sentinel Network database.

Target 3.0 million complaints 

actual

5.8 million complaints 

✔

 key measure 1.1.2 The percentage of the FTC’s 

consumer protection law enforcement actions that 

target the subject of consumer complaints to the FTC.

Target 70.0% of actions

actual

90.6% of actions 

✔

Performance measure 1.1.3 The rate of customer 

satisfaction with the FTC’s Consumer Response Center.

Target See (a) and (B) below

actual

(a) Exceeded 

✔

(B) Exceeded 

✔

Target: (a) For the website, exceed average citizen satisfaction rate as published in the E-Government 

Satisfaction Index

(B) For the call center, meet or exceed standards for call centers developed by the Citizen Service Levels 

Interagency Committee

Performance Measure Summary Tables

The tables that follow capture FY 2012 targeted performance compared to actual results and units of measure.

STRATEGIC GOAL 1: PROTECT CONSUMERS
performance section

40 Federal Trade Commission | Performance and Accountability Report 

Objective 1.2: Stop fraud, deception, unfairness, and other unlawful practices through 

law enforcement

 key measure 1.2.1 The percentage of all cases Target 80.0–90.0% of cases

filed by the FTC that were successfully resolved 

through litigation, a settlement, or issuance of a default 

judgment. actual

100.0% of cases 

✔

Performance measure 1.2.2 The FTC’s effectiveness in Target Statistically significant decrease in the 

prevalence of the practice.

stopping prohibited business practices in three high 

priority areas over the next five years.

actual On track

Performance measure 1.2.3 The percentage of redress Target 90.0% of cases

cases in which the FTC distributes redress dollars 

designated for distribution to consumers within six 

months. actual

95.0% of cases 

✔

Performance measure 1.2.4 Investigations or cases Target 30 investigations or cases

in which the FTC obtains foreign-based evidence or 

engages in mutual assistance that contributes to FTC 

law enforcement actions, or in which we cooperate with 

foreign agencies and/or multilateral organizations. actual

56 investigations or cases 

✔
41performance section

fiscal year 2012

Objective 1.3: Prevent consumer injury through education

Target 50 million messages

Performance measure 1.3.1 Consumer protection 

messages accessed online or in print.

39.4 million messages 

actual ✖

Exceed average citizen satisfaction rate 

as published in the American Customer Target Satisfaction Index E-Government 

Satisfaction Index key measure 1.3.2 Customer satisfaction rate 

with an FTC consumer education website or microsite.

Exceeded 

actual ✔

Target 12,000 organizations

Performance measure 1.3.3 Organizations requesting 

consumer education publications. 

11,298 organizations 

actual ✖
performance section

42 Federal Trade Commission | Performance and Accountability Report 

Objective 1.4: enhance consumer protection through research, reports, rulemaking, 

and advocacy

Target 8 workshops and conferences 

Performance measure 1.4.1 Workshops and conferences 

convened or cosponsored that address consumer 

protection problems.

actual 14 workshops and conferences

✔

Target 6 comments and briefs

Performance measure 1.4.2 Advocacy comments and 

amicus briefs on consumer protection issues filed with 

entities including federal and state legislatures, agencies, 

or courts.

actual

8 comments and briefs

✔

Target 75.0% of respondents

Performance measure 1.4.3 The percentage of 

respondents finding the FTC’s advocacy comments and 

amicus briefs “useful.”

actual N/A

 key measure 1.4.4 The percentage of proposed Target 75.0% of rulemakings

Administrative Procedure Act (APA) rulemakings, 

conducted solely by the FTC, completed within nine 

months of receipt of final comments in the Final Notice 

of Proposed Rulemaking. actual N/A
43performance section

fiscal year 2012

Objective 1.5: Protect american consumers in the global marketplace by providing 

sound policy and technical input to foreign governments and international 

organizations to promote sound consumer policy

 key measure 1.5.1 Policy advice provided to Target 60 policy inputs

foreign consumer protection and privacy agencies, 

directly and through international organizations, 

through substantive consultations, written submissions, 

or comments. actual 65 policy inputs

✔

Target 8 technical assistance missions or 

international Fellows hosted 

Performance measure 1.5.2 Technical assistance to 

foreign consumer protection and privacy authorities.

actual

18 technical assistance missions or 

international Fellows hosted 

✔

national do not Call 

registry

The FTC manages the National Do Not Call 

Registry, which protects consumers from 

receiving unwanted commercial telemarketing 

calls from legitimate marketers, who honor 

the system and recognize the importance of 

respecting consumer choice. The Registry 

empowers consumers to take charge of the commercial telemarketing calls they receive, and 

currently has over 217 million active telephone number registrations. It’s fast and free to register 

a number and registrations never expire. Consumers can register online at: www.donotcall.gov, or 

call toll-free: 888-382-1222 (TTY 866-290-4236), from the number they wish to register.
performance section

44 Federal Trade Commission | Performance and Accountability Report 

STRATEGIC GOAL 2: MAINTAIN COMPETITION

Objective 2.1: Take action against anticompetitive mergers and practices that may 

cause significant consumer injury

 key measure 2.1.1 Actions to maintain 

competition, including litigated victories, consent 

orders, abandoned transaction remedies, restructured 

transaction remedies, or fix-it-first transaction remedies 

in a significant percentage of substantial merger and 

nonmerger investigations.

Target 40.0–60.0% of substantial investigations

actual 43.1% of substantial investigations

✔

Performance measure 2.1.2 Consumer savings of at 

least $500 million through merger actions to maintain 

competition.

Target $500.0 million

actual

$504.9 million

✔

Performance measure 2.1.3 Actions against mergers 

likely to harm competition in markets with a total of at 

least $25 billion in sales.

Target $25.0 billion

actual

$20.2 billion 

✖

Performance measure 2.1.4 Consumer savings of at least 

six times the amount of FTC resources allocated to the 

merger program. (Efficiency Measure)

Target 1300.0%

actual

1492.4% 

✔

Performance measure 2.1.5 Consumer savings of at 

least $80 million through nonmerger actions taken to 

maintain competition. 

Target $450 million

actual

$439.8 million

✖

Performance measure 2.1.6 Actions against 

anticompetitive conduct in markets with a total of at 

least $8 billion in annual sales.

Target $12 billion

actual

$11.7 billion

✖

Performance measure 2.1.7 Consumer savings of at least 

four times the amount of FTC resources allocated to the 

nonmerger program. (Efficiency Measure)

Target 2000.0%

actual

1,831.7%

✖

Performance measure 2.1.8 The percentage of cases 

in which the FTC had at least one substantive contact 

with a foreign antitrust authority in which the agencies 

followed consistent analytical approaches and reached 

compatible outcomes.

Target 90.0% of cases

actual

100.0% 

✔
45performance section

fiscal year 2012

Objective 2.2: Prevent consumer injury through education

Target 24.0 million hits

 key measure 2.2.1 Competition resources 

accessed via the FTC’s website. 23.2 million hits 

actual ✖

Objective 2.3: enhance consumer benefit through research, reports, and advocacy

Target 4 workshops, seminars, conferences, and 

hearings

key measure 2.3.1 Workshops, seminars, 

conferences, and hearings convened or cosponsored 

that involve significant competition-related issues. 3 workshops, seminars, conferences, 

actual and hearings 

✖

Target 8 reports and studies

 key measure 2.3.2 Reports and studies issued 

on key competition-related topics.

actual 9 reports and studies

✔

 key measure 2.3.3 Advocacy comments and Target 10 comments and briefs

amicus briefs on competition issues filed with entities 

including federal and state legislatures, agencies or 

courts. actual

18 comments and briefs 

✔

Target 75.0% of respondents

Performance measure 2.3.4 The percentage of 

respondents finding the FTC’s advocacy comments and 

amicus briefs “useful.”

actual 83.3% of respondents 

✔

Target 1.7 million hits

Performance measure 2.3.5 The volume of traffic on 

www.ftc.gov relating to competition research, reports, 

and advocacy. 

actual

3.4 million hits

✔
performance section

46 Federal Trade Commission | Performance and Accountability Report 

Objective 2.4: Protect american consumers in the global marketplace by providing 

sound policy recommendations and technical advice to foreign governments and 

international organizations to promote sound competition policy

 key measure 2.4.1 Policy advice provided to Target 60 policy inputs

foreign competition agencies, directly and through 

international organizations, through substantive 

consultations, written submissions, or comments. actual 146 policy inputs

✔

Target 10 technical assistance missions or 

international Fellows hosted

Performance measure 2.4.2 Technical assistance 

provided to foreign competition authorities.

actual

27 technical assistance missions or 

international Fellows hosted 

✔

STRATEGIC GOAL 3: ADVANCE PERFORMANCE

Objective 3.1: Provide effective human resources management

Exceed the government-wide results 

Performance measure 3.1.1 The extent employees Target on the Federal Human Capital Survey’s 

Results-Oriented Performance Culture 

believe their organizational culture promotes Index

improvement in processes, products and services, 

and organizational outcomes. Exceeded

actual ✔

Exceed the government-wide results 

Target on the Federal Human Capital Survey’s 

 key measure 3.1.2 The extent employees think Talent Management Index

the organization has the talent necessary to achieve 

organizational goals. Exceeded 

actual ✔
47performance section

fiscal year 2012

Objective 3.2: Provide effective infrastructure and security management

Target 75.0% rating

 key measure 3.2.1 A favorable Continuity of 

Operations (COOP) rating.

actual 90.0% rating 

✔

Target 99.00% system availability

 key measure 3.2.2 Availability of information 

technology systems.

actual 99.86% system availability

✔

Objective 3.3: Provide effective information resources management

 key measure 3.3.1 The percentage of Target 80.0% of documents

Commission-approved documents in the FTC’s ongoing 

and newly initiated proceedings available via the 

Internet within 15 days of becoming part of the public 

record. actual

80.2% of documents 

✔

Objective 3.4: Provide effective financial and acquisition management

Target Unqualified opinion on the financial 

statements

Performance measure 3.4.1 Independent auditor’s 

financial statement audit results.

actual

Unqualified opinion

✔

Target 100.0% of Bureaus/Offices

key measure 3.4.2 The percentage of Bureaus/

Offices that establish and maintain an effective, riskbased internal control environment.

100.0% of Bureaus/Offices 

actual ✔

Target 23.0% of total small business 

eligible dollars 

Performance measure 3.4.3 Performance against the 

Small Business Administration’s government-wide small 

business procurement goals. 57.7% of total small business 

actual eligible dollars 

✔
performance section

48 Federal Trade Commission | Performance and Accountability Report 

STRATEGIC 

GOAL 1: PROTECT

CONSUMERS

Prevent fraud, deception, and unfair business practices 

in the marketplace.

I. Strategic View

As the nation’s premier consumer protection agency, 

the FTC strives to protect consumers by preventing 

fraud, deception, and unfair business practices in the 

marketplace. The agency implements five objectives to 

achieve this goal. 

oBJeCtive 1.1: identify fraud, deCePtion, 

and unfair PraCtiCes that Cause the 

greatest Consumer inJury.

The FTC identifies practices that cause consumer injury

by analyzing consumer complaint data it collects and 

maintains in its Consumer Sentinel Network database, 

holding public discussions, and monitoring the 

marketplace.

oBJeCtive 1.2: stoP fraud, deCePtion, 

unfairness, and other unlawful 

PraCtiCes through law enforCement. 

The FTC uses information gathered under Objective 

1.1 to target its law enforcement efforts. Its law 

enforcement program aims to stop and deter fraud 

and deception, protect consumers’ privacy, increase 

compliance with its consumer protection statutes and 

rules, and return funds to harmed consumers.

oBJeCtive 1.3: Prevent Consumer inJury 

through eduCation.

The FTC targets its education efforts to give consumers

the information they need to protect themselves from 

injury and to explain to businesses how to comply with 

applicable laws. 
49performance section

fiscal year 2012

To fulfill this objective, the FTC is using new 

technologies creatively and building on its broad base of 

private and public sector partners. The agency continues 

to collect consumer complaint information directly 

through four principal sources: (1) a toll-free helpline 

(1-877-FTC-HELP); (2) an identity theft hotline 

(1-877-ID-THEFT); (3) the National Do Not Call 

Registry (1-888-382-1222); and (4) the online consumer 

complaint forms that support each of these efforts, 

as well as online forms dedicated to complaints from 

members of the U.S. armed forces and to cross-border 

fraud complaints. In addition, the FTC continues to 

gather consumer complaint information from other 

sources, including other law enforcement agencies, 

the Better Business Bureaus, and private entities. 

The agency makes this and other information accessible 

through the secure website of the Consumer Sentinel 

Network (CSN), a unique investigative database of 

consumer complaints that is accessible to over 2,000 

law enforcement partner agencies worldwide. The 

CSN encompasses more than 20 million consumer 

fraud, identity theft, financial, and Do Not Call (DNC) 

complaints that the agency has collected since July 2006. 

The FTC staff and law enforcement partners also have 

the ability to search more than 312 million spam records 

collected by the FTC via spam@uce.gov. Consumer 

complaint and spam records older than five years are 

purged biannually. The agency augments identification 

of targets from its databases with other strategies for 

generating enforcement leads, such as ad monitoring, 

internet surfs (monitoring the internet for potentially 

false or deceptive advertising for a targeted product 

or service), and direct referrals from government and 

private sector partners.

Performance Results

Performance Measure 1.1.1 ensures that the agency 

assimilates a large number of consumer complaints, 

including complaints about DNC violations. The agenc

receives these complaints from a variety of sources, 

including direct consumer complaints to the FTC and 

complaints received by the FTC’s partners. In this 

manner, the FTC collects robust information to inform 

its law enforcement efforts. Key Measure 1.1.2 ensures 

that FTC law enforcement actions target the subject 

of concerns identified by consumers. Performance 

Measure 1.1.3 ensures that the agency’s consumer 

response center is providing satisfactory service 

responding to consumers.

y 
performance section

50 Federal Trade Commission | Performance and Accountability Report 

raNK caTeGOrY NuMber Of 

cOMPlaiNTS

PerceNT 

Of TOTal 

cOMPlaiNTS

cOMPared 

TO 2010

1 identity Theft 279,156 15% i From 19%

2 debt collection 180,928 10% i From 11%

3 Prizes, Sweepstakes and 

lotteries 100,208 6% h From 5%

4 Shop-at-Home and catalog Sales 98,306 5% h From 4%

5 banks and lenders 89,341 5% h From 2%

6 internet Services 81,805 5% fg

7 auto related complaints 77,435 4% h From 1%

8 impostor Scams 73,281 4% fg

9 Telephone and Mobile Services 70,024 4% h From 3%

10

advance-fee loans and credit 

Protection/repair 47,414 3% h From 2%
51performance section

fiscal year 2012

2014 *Target 3.0

TarGeT exceeded. 

In FY 2012, the FTC added 5.8 million entries into its database, 

exceeding the target of 3.0 million.

The increased number of complaints in FY 2012 was driven by a 

continuing increase in the number of external data contributors 

and consumers continuing to contact the FTC in ever increasing 

numbers. 

2013 *Target 3.0

2012

*Target 3.0

actual 5.8

2011

Target 2.6 * Targets for FY12 - FY14 were increased based on projected future 

performance as reported in the FTC’s FY 2012 Strategic Plan 

Addendum.

**Effective FY 2011, “and inquiries” was dropped from this 

performance measure. 

actual 4.0

2010

Target 2.5

actual 3.1

2009

Target 1.8

actual 3.3

2008

Target 1.8

actual 3.1

2007

Target 1.0

actual 1.1

2006

Target 1.0

actual 1.0

PERFORMANCE MEASURE 1.1.1

ComPlaints ColleCted and entered into the Consumer sentinel 

network dataBase. (inPut measure – numBers shown in millions)**
performance section

52 Federal Trade Commission | Performance and Accountability Report 

2014 *Target 70.0%

TarGeT exceeded. 

In FY 2012, 90.6%, or 58 of 64, of BCP’s actions targeted the subject 

of consumer complaints to the FTC. Because BCP augments 

identification of targets from its databases with other strategies for 

generating enforcement leads—such as ad monitoring, Internet surfs, 

and direct referrals from government and private sector partners—

the results vary from year to year.

* Targets for FY12 - FY14 were increased based on projected future 

performance as reported in the FTC’s FY 2012 Strategic Plan 

Addendum.

2013 *Target 70.0%

2012

*Target 70.0%

actual 90.6%

2011

Target 65.0%

actual 80.4%

2010

Target 65.0%

actual 95.9%

2009

Target 65.0%

actual 79.0%

2008

Target 65.0%

actual 71.0%

2007

Target 50.0%

actual 76.0%

2006

actual n/a

Target n/a
53performance section

fiscal year 2012

PERFORMANCE MEASURE 1.1.3

the rate of Customer satisfaCtion with the ftC’s Consumer resPonse Center. 

(outCome measure)

2014 Target See (A) and (B)

TarGeT MeT. 

In FY 2012, the average citizen satisfaction score for 

participating federal government websites was 74, and the 

score for the FTC’s website was 75. The standard for call 

centers was 74, and the FTC’s score was 79.

2013 Target See (A) and (B)

2012

Target see (a) and (B)

actual

(a) exceeded 

(ftC score of 

75, benchmark 

score of 74)

(B) exceeded 

(ftC score of 

79, benchmark 

score of 74)

2011

Target see (a) and (B)

actual

(a) exceeded 

(ftC score of 

75, benchmark 

score of 74)

(B) exceeded 

(ftC score of 

77, benchmark 

score of 74)

2010

Target see (a) and (B)

actual

(a) exceeded 

(ftC score of 

75, benchmark 

score of 74)

(B) exceeded 

(ftC score of 

76, benchmark 

score of 74)

Target: (a) For the website, exceed average citizen satisfaction rate as published in the ACSI’s E-Government 

Satisfaction Index.

(B) For the call center, meet or exceed standards for call centers developed by the Citizen Service Levels 

Interagency Committee.
performance section

54 Federal Trade Commission | Performance and Accountability Report 

Ob

Performance Results

Key Measure 1.2.1 ensures that the FTC successfully 

resolves cases, though it aims to file large, precedent 

setting cases when appropriate, including cases that 

raise challenging legal and factual issues. Performance 

Measure 1.2.2 ensures the agency’s success in 

changing business practices within priority areas and 

demonstrates the change through research methods. 

Performance Measure 1.2.3 ensures that the FTC 

returns redress dollars to consumers as quickly as 

possible. Dollars are considered “designated for 

distribution” when the FTC is in receipt of all funds, 

legal issues are resolved, and a usable claimant list is 

ready. Performance Measure 1.2.4 helps gauge law 

enforcement efforts from an international perspective, 

including continuing to use and further develop powers 

authorized under the Undertaking Spam, Spyware, and 

Fraud Enforcement With Enforcers beyond Borders 

Act of 2006 (U.S. SAFE WEB Act) to achieve the 

objective.

2014 *Target 80.0-90.0%

TarGeT exceeded. 

2013 *Target 80.0-90.0% Of the 128 cases resolved in FY 2012, all were successfully resolved 

through litigation, a settlement, or issuance of a default judgment. 

At the end of FY 2012, an additional 92 cases had not been resolved, 

and remained in litigation.

2012

*Target 80.0-90.0%

actual 100.0% While the agency significantly exceeded the target, setting the 

target too high could discourage the filing of large, difficult, or 

precedent-setting cases, including cases that raise challenging legal 

Target 75.0-85.0% and factual issues.

2011 * Targets for FY12 - FY14 were increased based on projected future 

performance as reported in the FTC’s FY 2012 Strategic Plan 

Addendum.

actual 100.0%

Target 75.0-85.0%

2010

actual 99.2%
55performance section

fiscal year 2012

PERFORMANCE MEASURE 1.2.2

the ftC’s effeCtiveness in stoPPing ProhiBited Business PraCtiCes in three hig

Priority areas over the next five years. (outCome measure)

h 

2014 Target

Statistically significant 

decrease in the 

prevalence of the 

practice.

TarGeT ON TracK, NOT YeT MeT.

The FTC is making progress to meet this 5-year target 

going forward as described below. 

The three high priority areas fall under the realm of 

deceptive “green” marketing claims. They are stopping 

false and misleading claims for: bamboo textiles, energyefficient windows, and “zero-VOC” paint.

The FTC is currently conducting two studies to examine 

the agency’s effectiveness in stopping such misleading 

advertising claims. The first study involves websites 

marketing textiles purportedly made from bamboo. The 

FTC reviewed websites to establish a baseline of those 

marketing “bamboo textiles,” charged four sellers with 

making false claims about their products, and then sent 78 

warning letters to companies that continued making these 

claims. The FTC decided to undertake additional work in 

this area before capturing the sample again. Because this 

additional work is continuing, the FTC does not have final 

results to report. 

The FTC’s second study involves energy efficiency and cost 

savings claims for replacement windows. The FTC staff 

created a baseline by identifying 29 websites that made 

deceptive energy and cost savings claims for replacement 

windows. The FTC issued complaints and entered consent 

orders against five of the largest firms that allegedly made 

these claims. The FTC staff then reviewed the websites, 

finding 15 sellers were still making deceptive claims. The 

FTC issued warning letters to those marketers and FTC 

staff followed those letters with telephone calls. The FTC 

staff surveyed the websites again and found that not only 

has there been a statistically significant decrease in the 

prohibited practices, but the project has put an end to 

inflated energy and cost savings claims for replacement 

windows on the Internet.

The FTC’s third study will examine the agency’s 

effectiveness in stopping misleading “zero-VOC” claims for 

paint.

2013 Target

Statistically significant 

decrease in the 

prevalence of the 

practice

2012

Target

statistically 

significant decrease 

in the prevalence of 

the practice.

actual on track.

2011

Target

statistically 

significant decrease 

in the prevalence of 

the practice.

actual n/a

2010

Target

statistically 

significant decrease 

in the prevalence of 

the practice.

actual n/a
performance section

56 Federal Trade Commission | Performance and Accountability Report 

PERFORMANCE MEASURE 1.2.3

the PerCentage of redress Cases in whiCh the ftC distriButes redress 

dollars designated for distriBution to Consumers within six months. 

(effiCienCy measure)

2014 Target 90.0%

TarGeT exceeded. 

2013 Target 90.0% In FY 2012, in 19 of 20 cases or 95.0%, the FTC distributed redress dollars 

designated for distribution to consumers within six months.

After multiple years of measuring the distribution of redress dollars, the target 

appears to be appropriate. 2012

Target 90.0%

actual 95.0%

Target 90.0%

2011

actual 100%

Target 90.0%

2010

actual 96.0%

ftC targets overhyPed 

advertising Claims

In May 2012, the FTC announced that Skechers 

USA, Inc. agreed to pay $40 million to settle 

charges that the company deceived consumers 

by making unfounded claims that Shape-ups 

athletic shoes would help people lose weight 

and strengthen and tone their buttocks, legs, 

and abdominal muscles. The FTC also alleged 

Skechers made deceptive claims about its 

Resistance Runner, Toners, and Tone-ups shoes. 

Consumers who bought these “toning” shoes will be eligible for refunds. The Skechers settlement 

is part of FTC’s ongoing effort to stop overhyped advertising claims, and follows a similar 

settlement with Reebok International Ltd. in September 2011, in which Reebok paid $25 million for 

refunds as part of its settlement agreement with the agency. In August 2012, the FTC announced 

that a settlement administrator is mailing approximately 315,000 checks to consumers who 

bought these allegedly deceptively advertised toning shoes and apparel from the company. For 

more information, please visit: www.ftc.gov/opa/2012/05/consumerrefund.shtm (Skechers) and

www.ftc.gov/opa/2012/08/reebok.shtm.
57performance section

fiscal year 2012

PERFORMANCE MEASURE 1.2.4

investigations or Cases in whiCh the ftC oBtains foreign-Based evidenCe 

or engages in mutual assistanCe that ContriButes to ftC law enforCement 

aCtions or in whiCh we CooPerate with foreign agenCies and/or multilateral 

organizations. (outPut measure)

2014 Target 30

TarGeT exceeded. 

In FY 2012, the FTC cooperated with its foreign counterparts on consumer 

protection and privacy matters to obtain evidence and other assistance for 

2013 Target 30

2012

Target 30

the FTC’s investigations and litigation with numerous jurisdictions including 

Australia, Canada, Costa Rica, the Dominican Republic, Germany, Ireland, Israel, 

and the United Kingdom. Foreign agencies assisted the FTC in activities such 

as locating investigative targets and defendants, obtaining corporate records, 

obtaining witness statements, and providing investigative information. The FTC 

actual 56 also provided assistance to numerous foreign entities, including pursuant to the 

information sharing and investigative assistance provisions of the U.S. SAFE 

WEB Act of 2006. In several instances, the information the FTC provided to the 

Target 30 foreign entity resulted in a parallel proceeding or reciprocal assistance to the 

FTC. 

2011

actual 53

Target 30

2010

actual 39

ftC targets ComPanies 

that misrePresent 

PrivaCy assuranCes

Google Inc. agreed to pay a record $22.5 

million civil penalty in August 2012 to settle 

FTC charges that it misrepresented to users of 

Apple Inc.’s Safari Internet browser that it would 

not place tracking “cookies” or serve targeted 

ads to those users, violating an earlier privacy 

settlement between the company and the FTC. 

The settlement is part of the FTC’s ongoing efforts to make sure companies live up to the privacy 

promises they make to consumers, and is the largest penalty the agency has ever obtained 

for a violation of a Commission order. In addition to the civil penalty, the order also requires 

Google to disable all the tracking cookies it had previously said it would not place on consumers’ 

computers. For more information, visit: www.ftc.gov/opa/2012/08/google.shtm.
performance section

58 Federal Trade Commission | Performance and Accountability Report 

Performance Results

Consumer and business education is crucial to prevent 

and reduce consumer harm. Performance Measure 

1.3.1 ensures that the FTC continue to promote 

educational activity and that the educational materials 

are aimed at new trends and at particularly vulnerable 

populations. Key Measure 1.3.2 ensures that the 

agency’s consumer education websites are effective 

and helpful for consumers. Performance Measure 1.3.3 

ensures that the FTC is publicizing its activities in the 

best way possible and that the agency has a wide array 

of partners to leverage resources.

identity theft 

eduCational 

materials

If your identity is stolen, what will you do? Do 

you know your rights? An identity thief can hijack 

your tax refund, alter your medical records, or 

prevent you from getting credit or a job. Kids 

can also be victims of identity theft, and thieves 

can even borrow money in your child’s name. In 

June 2012, the FTC offered updated information 

explaining how to protect your child’s information and your own, and the immediate steps to 

take to limit the damage identity theft can cause. “Taking Charge: What To Do If Your Identity 

Is Stolen” is a step-by-step guide that includes sample letters, forms, and essential contact 

information. A brochure, “Identity Theft: What To Know, What To Do” explains the basic steps of 

protecting information and responding to identity theft. “Safeguarding Your Child’s Future” tells 

parents how to protect their children’s information, find out if a credit report has been created for 

them, and respond to problems. Information is also available in three new one-minute videos. For 

more information, visit: www.ftc.gov/bcp/edu/microsites/idtheft2012.
59performance section

fiscal year 2012

PERFORMANCE MEASURE 1.3.1

Consumer ProteCtion messages aCCessed online or in Print. (outPut measure – 

numBers shown in millions)

2014 Target 50.0

TarGeT NOT MeT. 

In FY 2012, the FTC accomplished approximately 80% of its target of 

50 million messages. Of the nearly 39.4 million consumer protection 

messages accessed, more than 27.5 million were accessed online, 

more than 1.1 million were accessed via video, and more than 10.7 

million were print publications distributed by the FTC. Of the 

messages accessed, identity theft information perennially is the most 

popular, followed by credit-based information. The mid-summer 

release of new identity theft materials has boosted print distribution 

numbers, as these materials are being marketed to libraries and 

community organizations.

While the number of print publications distributed remained 

relatively static over many years, as more consumers and businesses 

went online, the number of publications accessed through the 

Internet soared before leveling off in recent years. Also, the 

results underestimate the FTC’s impact. The agency’s partners 

are increasingly opting to post the FTC’s information on their own 

websites, and the agency has also increasingly taken advantage of 

the outreach potential of the “blogosphere.” The FTC is unable to 

measure the number of its consumer protection messages accessed 

on partner websites or blogs.

2013 Target 50.0

2012

Target 50.0

actual 39.4

2011

Target 50.0

actual 41.4

2010

Target 50.0

actual 43.9

2009

Target 55.0

actual 43.1

2008

Target 50.0

actual 49.2

2007

Target 45.0

actual 47.0

2006

Target 25.0

actual 53.0
performance section

60 Federal Trade Commission | Performance and Accountability Report 

Phantom deBt 

ColleCtion Cases

The FTC has taken action against two operations 

that allegedly collected payday loan “phantom 

debts” that consumers did not owe. In February 

2012, the FTC brought a case against American 

Credit Crunchers, LLC, and in April 2012, the 

FTC brought a case against Broadway Global 

Master Inc., to halt their alleged fraudulent debt 

collection practices. In the American Credit 

Crunchers case, the FTC alleges consumers 

received millions of collections calls from India, and that since January 2010, the operation took 

in more than $5 million from victims. In the Broadway Global Master case, the FTC alleges that 

the defendant made more than 2.7 million calls to at least 600,000 different phone numbers 

nationwide, fraudulently collecting more than $5.2 million from consumers. Court orders have 

temporarily stopped the illegal conduct and frozen both operations’ assets while the FTC moves 

ahead with the cases and seeks refunds for consumers. For more information, visit: 

www.ftc.gov/opa/2012/02/acc.shtm and www.ftc.gov/opa/2012/04/broadway.shtm.
61performance section

fiscal year 2012

e. 

Exceed average citizen satisfaction 

2014 Target rate as published in the TarGeT MeT. 

E-Government Satisfaction Index

In FY 2012, the FTC continued to evaluate 

www.OnGuardOnline.gov, a joint effort of 

2013 Target

Exceed average citizen satisfaction 

rate as published in the the federal government and the technology 

industry, created, maintained, and marketed by E-Government Satisfaction Index the FTC to help computer users guard against 

Internet fraud, secure their computers, and 

exceed average citizen satisfaction protect their personal information. The average 

Target rate as published in the 

e-government satisfaction index 

citizen satisfaction score for participating 

federal government websites was 74, and the 

(a score of 74) score for www.OnGuardOnline.gov was 81. 

2012 The continued measurement of the website 

over time has allowed the FTC to assess the 

effect of website improvements on customer 

actual satisfaction.

exceeded 

(ftC score of 81)

exceed average citizen satisfaction 

Target rate as published in the 

e-government satisfaction index 

(a score of 74)

2011

actual exceeded 

(ftC score of 81)

exceed average citizen satisfaction 

Target rate as published in the 

e-government satisfaction index 

(a score of 74)

2010

actual exceeded 

(ftC score of 77)
performance section

62 Federal Trade Commission | Performance and Accountability Report 

PERFORMANCE MEASURE 1.3.3 

organizations reQuesting Consumer eduCation PuBliCations. (outPut measure)

2014 *Target 12,600

TarGeT NOT MeT. 

2013 *Target 12,300 In FY 2012, 11,298 organizations requested publications 

from the FTC, down from expected levels. It should be 

noted, however that the order site was inoperable for 

*Target 12,000 six weeks to protect against a security threat. Based 

on estimates of orders lost during that time period, the 

2012 goal would likely have been met had this action not 

been necessary. Nonetheless, in FY 2012 the agency did 

actual 11,298 see increased interest in new identity theft materials 

developed, including, “Taking Charge: What to Do If 

Your Identity Is Stolen.” 

* Targets for FY12 - FY14 were increased based on 

projected future performance as reported in the FTC’s 

FY 2012 Strategic Plan Addendum. 2011

Target 11,300

actual 14,818

Target 11,000

2010

actual 15,372
63performance section

fiscal year 2012

Performance Results

Public policy that enhances consumer protection 

is based on a thorough understanding of complex 

issues, which arises from dialogue, study, and empirical 

research. Such policy also appreciates that stakeholders 

other than government, such as industry associations 

or private standard-setting organizations, are at 

times better positioned to address certain consumer 

protection issues. Performance Measures 1.4.1 through 

1.4.3, and Key Measure 1.4.4, allow the agency to gauge

the success of this objective and help ensure that the 

agency augments its enforcement and education efforts 

by encouraging discussions among all interested parties,

through careful study of and empirical research on 

novel or challenging consumer protection problems, 

by urging adoption of policies and legal principles 

that promote consumers’ interest, and by conducting 

rulemaking as appropriate. These activities help guide 

the FTC’s consumer protection policy decisions, as 

well as those of other state, federal, and international 

policymakers.
performance section

64 Federal Trade Commission | Performance and Accountability Report 

PERFORMANCE 

MEASURE 1.4.1 

workshoPs and 

ConferenCes Convened or 

CosPonsored that address 

Consumer ProteCtion 

ProBlems. (outPut measure)

2014 *Target 8

TarGeT exceeded. 

2013 *Target 8 In FY 2012, the FTC exceeded 

its target and convened or 

cosponsored 14 workshops and 

conferences that addressed 

consumer protection problems. 

These events brought together 

approximately 1,500 participants. 

* Targets for FY12 - FY14 were 

increased based on projected 

future performance as reported in 

the FTC’s FY 2012 Strategic Plan 

Addendum.

** This target change took effect for 

FY 2011 reporting.

2012

*Target 8

actual 14

2011

**Target 8

actual 14

2010

Target 6

actual 11

2009

Target 6

actual 9

2008

Target 6

actual 16

2007

Target 6

actual 10

2006

Target n/a

actual n/a
65performance section

fiscal year 2012

PERFORMANCE 

MEASURE 1.4.2 

advoCaCy Comments 

and amiCus Briefs on 

Consumer ProteCtion 

issues filed with 

entities inCluding 

federal and state 

legislatures, agenCies, 

or Courts. 

(outPut measure)

2014 Target 6

TarGeT exceeded. 

In FY 2012, the FTC filed advocacy 

2013 Target 6 comments and amicus briefs on 

consumer protection issues such 

as mortgage disclosures, the 

placement of unauthorized charges 

Target 6 on telephone bills, the regulation 

of reloadable prepayment cards, 

debt collection practices under the 

2012 Fair Debt Collection Act, and the 

actual 8

constitutionality of the Fair Credit 

Reporting Act.

The agency exceeded the target 

for filing consumer protectionrelated briefs and comments. By 

contrast, in FY 2011 the agency filed 

Target 6 only three consumer protectionrelated briefs and comments, and 

2011 did not meet the target. These 

performance results highlight the 

inherent unpredictability of the 

actual 3 types and number of issues that 

might arise before state and federal 

government bodies and therefore 

the types of comments and briefs 

that the agency might file in 

Target 6 response.

The agency will continue to monitor 

2010 the target of this relatively new 

measure and will reassess it after 

additional performance cycles.

actual 6
performance section

66 Federal Trade Commission | Performance and Accountability Report 

PERFORMANCE 

MEASURE 1.4.3 

the PerCentage of 

resPondents finding the 

ftC’s advoCaCy Comments 

and amiCus Briefs “useful.” 

(outCome measure)

2014 *Target 75.0% daTa NOT available. 

The FTC mails advocacy recipients 

a survey designed to gauge the 

usefulness of agency advocacy 

comments and amicus briefs. 

“Usefulness” is assessed by the 

2013 *Target 75.0%

recipient. The target percentage 

*Target 75.0% recognizes that comments 

critiquing a recipient’s proposed 

2012 action may not be assessed 

positively. In FY 2012, no survey 

actual n/a responses were received regarding 

the four advocacy comments. 

Consideration of these four 

comments by advocacy recipients 

had not concluded by the end 

Target 50.0% of FY 2012, highlighting the 

unpredictability of whether a 

2011 survey response will be received. 

The FTC also provided four 

actual 100.0% amicus briefs to courts regarding 

consumer protection matters; 

as noted in the Data Quality 

Information Appendix, surveys are 

Target 50.0%

not sent to courts. The agency will 

continue to monitor the target of 

this relatively new measure and 

will reassess it after additional 

2010

performance cycles.

* Targets for FY12 - FY14 were 

increased based on projected 

future performance as reported in 

actual 100.0% the FTC’s FY 2012 Strategic Plan 

Addendum.

2014 Target 75.0%

There is no data to consider under 

this measure, as the FTC had no 

APA rulemakings to consider in FY 

2012.

2013 Target 75.0%

Target 75.0%

2012

actual n/a

Target 75.0%

2011

actual 83.3%

Target 75.0%

2010

actual 100.0%
67performance section

fiscal year 2012

The agency also focuses on understanding cutting-edge 

issues in technology and globalization that present 

challenges to American consumer interests. The agency 

influences policy development and implementation by 

advising multilateral organizations, regional entities, and 

foreign government agencies through substantive 

consultations and written comments. And finally, the 

FTC provides technical assistance to newer consumer 

protection agencies to enhance their ability to apply 

sound consumer protection policies.

Performance Results

The FTC uses two measures to assess the performance 

of this objective. Key Measure 1.5.1 and Performance 

Measure 1.5.2 address the scope of agency contact with 

international counterparts and help determine if agency 

efforts are sufficiently broad-based.

2014 *Target 60

TarGeT exceeded. 

In FY 2012, the FTC provided 

2013 *Target 60 policy advice in over 60 

instances, through consultations, 

presentations, and written 

comments. An increased focus 

*Target 60 on Internet policy and consumer 

privacy, both by foreign agencies 

2012 and by a growing range of 

international organizations, has 

actual 65 sustained a strong demand for the 

FTC’s policy advice and technical 

input on consumer policy and 

related issues. 

Target 40 * Targets for FY12 - FY14 were 

2011 increased based on projected 

future performance as reported in 

actual 52 the FTC’s FY 2012 Strategic Plan 

Addendum.

2010

Target 40

actual 64
performance section

68 Federal Trade Commission | Performance and Accountability Report 

2007 2008 2009 2010 2011

Full-Time 570 591 597 621 633 Equivalents

Obligations $126 $140 $152 $168 $166

Net Cost $105 $124 $131 $144 $155

Note: Differences between these obligations and net costs an

financial statements are due to rounding.

2012

625

$161

$151

Resources Utilized—

Strategic Goal 1

(DOLLARS SHOwN IN 

MILLIONS.)

PERFORMANCE 

MEASURE 1.5.2 

teChniCal assistanCe 

to foreign Consumer 

ProteCtion and 

PrivaCy authorities. 

(outPut measure)

2014 Target 8 TarGeT exceeded. 

In FY 2012, the FTC conducted 

13 technical assistance missions 

and hosted five international 

2013 Target 8 fellows supporting the consumer 

protection mission. The FTC 

received funding from the 

U.S. Agency for International 

Development to conduct consumer 

Target 8 protection technical assistance 

missions in Central America, the 

2012 Dominican Republic, Vietnam, 

and the ASEAN region as well 

actual 18 as to place a resident advisor in 

South Africa. Four of the technical 

assistance missions, the resident 

advisor, and one international 

Target 8 fellow were funded by the 

U.S. Agency for International 

2011 Development.

actual 15

Target 8

2010

actual 23

d the 
69performance section

fiscal year 2012

STRATEGIC 

GOAL 2: MAINTAIN

COMPETITION

Prevent anticompetitive mergers and other 

anticompetitive business practices in the marketplace.

I. Strategic View

A key function of the FTC is to protect and strengthen 

the free and open markets that are the cornerstone of a 

vibrant economy. Aggressive competition among sellers 

in an open marketplace gives consumers the benefit 

of lower prices, higher quality products and services, 

maximum choice, and innovation leading to beneficial 

new products and services. The FTC seeks to promote 

vigorous competition by using the antitrust laws to 

prevent anticompetitive mergers and to stop business 

practices that diminish competition, such as agreements 

among competitors about prices or other aspects of 

competition (referred to as nonmerger enforcement). 

The agency applies four related objectives to achieve 

this broad-reaching goal.

the ftC ProteCts 

against 

antiComPetitive 

taCtiCs that keeP out 

ComPetition

The FTC is particularly vigilant where a firm may 

be illegally using a dominant market position 

to stifle competition and raise prices, reduce product quality or choice, or reduce innovation. 

For example, in November 2011, the FTC settled charges that PoolCorp, the largest distributor 

of swimming pool products in the United States, used its monopoly power to thwart new 

distributors from entering the market by blocking them from buying pool products directly from 

manufacturers. According to the FTC, PoolCorp threatened manufacturers of pool products that 

PoolCorp would not sell their products at any of its distribution centers if the manufacturers 

sold their products to new distributor-rivals. The FTC charged that these anticompetitive tactics 

raised the costs incurred by its distributor-rivals, resulting in higher prices and reduced choices 

for consumers. The FTC’s settlement order prohibits PoolCorp from conditioning the purchase or 

sale of pool products, coercing manufacturers to stop selling or to limit their sales to any other 

distributor, and discriminating or retaliating against a manufacturer for selling, or intending to 

sell pool products to any other distributor. The FTC also required that PoolCorp put in place an 

antitrust compliance program to ensure it does not violate the terms of the order.
performance section

70 Federal Trade Commission | Performance and Accountability Report 

II. Strategic Analysis

oBJeCtive 2.1: take aCtion against 

antiComPetitive mergers and PraCtiCes

that may Cause signifiCant Consumer 

inJury.

Taking action against anticompetitive mergers and 

anticompetitive business conduct is the first step in 

effective antitrust enforcement.

Our Strategy

The FTC seeks to identify and take action against 

anticompetitive mergers and practices with as much 

accuracy as possible. While certain business conduct 

(such as price fixing among competitors) is clearly 

anticompetitive, mergers and many other forms of 

business conduct can benefit, harm, or have no effect 

on consumers. Consequently, both under- and over 

enforcement can harm consumers’ interests. The 

agency seeks to take enforcement action against 

transactions or practices that harm, or are likely to 

harm, consumers. At the same time, the agency seeks 

to avoid taking actions that prevent businesses from 

completing transactions or engaging in practices 

that fundamentally benefit consumers or have no 

competitive effect. The FTC also tries to identify 

enforcement targets as efficiently as possible so that 
71performance section

fiscal year 2012

it can devote the bulk of its resources to further 

investigation of, and possible challenge to, the most 

problematic mergers and practices. A related, but 

important, consideration is to conduct each inquiry 

in a way that minimizes the cost or inconvenience to 

businesses, while still enabling the agency to gather 

sufficient information to support each enforcement 

decision. Given the agency’s limited resources, the 

FTC directs much of its attention and resources to 

certain segments of the economy that are particularly 

important to consumers and in which it has particular 

expertise. These include health care, pharmaceuticals, 

technology, energy, and real estate.

MERGER ACTIVITIES

The premerger notification requirements of the 

Hart-Scott-Rodino (HSR) Act provide the FTC with 

an effective starting point for identifying potentially 

anticompetitive mergers, acquisitions, and joint 

ventures (collectively referred to as mergers) before 

they are consummated. The HSR Act requires 

companies to report certain proposed mergers to the 

FTC and the DOJ, which jointly enforce the HSR 

Act, and wait for a specified period (usually 30 days) 

to allow for antitrust review. FTC staff examines each 

transaction to determine whether it poses a threat to 

competition. In most cases, a reasonable judgment can 

be made about whether the merger has the potential to 

be anticompetitive based on the materials filed with the 

HSR Act notification. In other cases, a formal request 

for additional information may be issued by the FTC. 

This is referred to as a “second request.” Because the 

parties may consummate a transaction after substantially 

complying with the second request and waiting for a 

short time period (usually 30 days), a second request 

investigation typically requires a significant investment 

of resources by the FTC. The agency must act quickly 

to gather and review information to make a decision 

on whether to pursue enforcement action to block a 

merger within the timeframe set out by the HSR Act 

and rules.

To stop potentially anticompetitive mergers and 

practices through law enforcement, the FTC seeks 

legal remedies under the antitrust laws through 

federal court action, administrative proceedings, 

or negotiated settlements. For mergers, the most 

effective and cost efficient strategy has been to prevent 

anticompetitive mergers before they occur. The agency 

has implemented this strategy primarily through its 

authority to seek federal court injunctions preventing 

these transactions. In many cases, the merging parties 

elect not to defend a court challenge and instead 

agree to resolve competitive concerns through a 

consent agreement. This approach is suitable when 

the competitive problem relates to only a portion of 

the transaction, such that a divestiture of assets will 

be sufficient to preserve or restore competition while 

allowing other competitively neutral or beneficial 

aspects of the merger to go forward. In other instances, 

the parties may abandon a transaction after assessing 

the likely outcome of an FTC court challenge. 

sCrutinizing energy 

mergers

The Federal Trade Commission is committed 

to promoting competition in the energy sector. 

In May 2012, the FTC accepted a consent order 

which required Kinder Morgan, Inc., one of the 

largest U.S. transporters of natural gas and 

other energy products, to sell three natural gas 

pipelines, two gas processing plants and associated storage capacity in the Rocky Mountain 

region. This divestiture settled FTC charges that Kinder Morgan’s $38 billion acquisition of El 

Paso Corporation would be anticompetitive, harming competition in the markets for the pipeline 

transportation and processing of natural gas.
performance section

72 Federal Trade Commission | Performance and Accountability Report 

When a merger already has been consummated, the 

FTC generally relies on administrative litigation to 

restore competition lost as a result of the merger. 

While the major HSR Act amendments in 2001 

reduced the number of mergers subject to the 

advance reporting requirement, they did not change 

the standard of legality for mergers. Whereas the vast 

majority of potentially problematic mergers continue 

to be subject to the revised HSR filing requirements, 

smaller merger transactions may still be anticompetitive

Consequently, the FTC continues to devote attention t

the identification of unreported, usually consummated,

mergers that could harm consumers. In FY 2012, the 

agency successfully resolved a challenge to one such 

transaction. This effort involves monitoring trade press

industry sources, and the internet to stay informed of 

industry developments; following up on case leads fro

Congressional offices, other Executive Branch agencies

and state and local governments; and encouraging 

consumers, businesses, and attorneys to notify the 

FTC of possible anticompetitive mergers.

.

o 

, 

m

, 

NONMERGER ACTIVITIES

In the nonmerger area, agency staff reviews complaints 

received from consumers, businesses, Congressional 

offices, and elsewhere to identify potentially 

anticompetitive nonmerger business practices. 

In addition, the FTC has pursued a “positive agenda” 

of planned initiatives; that is, the agency has taken a 

systematic and proactive approach to identify specific 

conduct likely to pose the greatest threat to consumer 

welfare. The focus continues to be on the types of 

practices, such as agreements among competitors, which 

are most likely to harm consumers.

In deploying its enforcement resources, the agency 

focuses on sectors of the economy, such as health 

care, energy, real estate, or high technology, that have 

a significant impact on consumers’ daily lives. Also, 

the agency considers the deterrent effects of antitrust 

enforcement on businesses and whether the FTC has 

enforcement experience in an area that will enable the 

agency to make an impact quickly and efficiently. Finally, 

consideration is given to whether the matter presents an 

opportunity to contribute positively to the development 

of antitrust law.

prices that were otherwise likely to result from the acquisitions.
73performance section

fiscal year 2012

In nonmerger matters, the FTC seeks to take action 

against ongoing activity that harms competition. The 

FTC may initiate administrative proceedings before an

Administrative Law Judge to adjudicate the issues and 

establish a basis for an order that the parties “cease an

desist” from anticompetitive conduct. The FTC also h

the authority to seek relief in federal courts, although i

historically has used this option sparingly in nonmerge

matters. Again, the agency is often able to negotiate a 

consent agreement with the parties that remedies the 

problem without need for litigation.

In both merger and nonmerger matters, thorough 

investigation and sophisticated legal and economic 

analysis are of critical importance to ensure accurate 

assessment of the potential 

resulting from the transactio

and, if necessary, demonstra

for competitive harm 

n or conduct in question 

te the likelihood of 

d 

as 

t 

r 

harm before an adjudicative body. When the FTC 

concludes that the likelihood of such harm indicates 

a law violation, and no settlement is possible, the FTC 

authorizes its staff to litigate the matter. The frequency 

with which the agency prevails in litigation or secures 

a consent order to restore competition is an important 

indicator of its success in producing tangible benefits 

for consumers.

This is not to say that the FTC, or any law enforcement 

agency, should win every case. The FTC issues 

complaints when, based on the findings of staff 

investigations, it has “reason to believe” a merger or 

conduct is anticompetitive. Some cases involve very 

close issues, on which reasonable minds can and do 

differ. Other cases may be very difficult from a litigation 

standpoint, but are still worth pursuing. 

key ruling in a 

“Pay-for-delay” 

PharmaCeutiCal 

Patent settlements 

Case

One of the FTC’s top priorities is restricting 

anticompetitive “pay-for-delay” patent 

settlements, as these agreements between branded manufacturers and generic competitors 

delay the availability of low-cost generic drugs. As a part of this effort in 2011, the FTC filed an 

amicus brief before the U.S. Court of Appeals for the Third Circuit in support of private class 

action plaintiffs that challenged the legality of these patent settlements between branded and 

generic manufacturers of the high blood pressure medication K-Dur 20. The FTC’s brief argued 

that the district court’s analysis conflicted with basic antitrust principles because it would allow 

branded companies to pay generic companies to stay out of the market until patent expiration. In 

July 2012, the Third Circuit reversed the district court ruling, as the FTC had urged, and held that 

a reverse payment from a branded drug manufacturer to a generic competitor is “prima facie 

evidence of an unreasonable restraint of trade.” 

FTC Chairman Jon Leibowitz issued the following statement about the ruling: “The Third Circuit 

Court of Appeals seems to have gotten it just right: These sweetheart deals are presumptively 

anticompetitive. As our Bureau of Economics has estimated, they cost American consumers $3.5 

billion a year in higher health care costs. Restricting these arrangements, as many in Congress 

have proposed, would reduce federal government debt by $5 billion over 10 years, according to 

the Congressional Budget Office. It’s time for the pharmaceutical companies to return to the side 

of consumers.”
performance section

74 Federal Trade Commission | Performance and Accountability Report 

The FTC’s antitrust challenges are defended by highly 

competent and well-financed counsel. In addition, the 

FTC’s responsibilities include taking action to help 

shape the development of the antitrust laws. To fulfill 

this duty, the agency inevitably must bring cases that 

pose litigation risks, especially where there is no clear 

precedent and the FTC is seeking to establish a new 

legal principle. The FTC also helps consumers and 

businesses by bringing cases to clarify, or improve upon

existing precedent.

Performance Results

The key performance measure under this objective 

relates to actions taken in a significant percentage of 

substantial merger and nonmerger investigations. 

This translates into obtaining a positive result (i.e., 

litigated victories, consent orders, or abandoned 

transactions) in 40 to 60 percent of investigations that 

involved a second request or compulsory process, in 

the case of merger investigations, or which involved at 

least 150 hours of investigative effort, in the case of 

nonmerger investigations.

Success on this key outcome measure indicates that 

the FTC is effectively screening HSR reported mergers 

and nonmerger investigations to identify those that 

raise significant antitrust issues and warrant further 

investigation and possible enforcement action, while 

at the same time permitting deals or conduct that 

are neutral or beneficial to consumers to proceed 

unimpeded. This measure evaluates appropriate 

investigation, case selection, and resolution, as well as 

the crafting of sufficient and effective remedies.

The target range of 40 to 60 percent set for key 

Performance Measure 2.1.1 reflects the reality that 

the FTC conducts substantial merger and nonmerger 

investigations when it believes that a merger or 

conduct may be anticompetitive, but that not all such 

investigations should lead to an enforcement action or 

a positive result. Indeed, the existence of a minimum 

and maximum value recognizes the possibility that 

the FTC may find itself under- or over-enforcing 

the competition laws, while the magnitude of the 

spread between these two values serves to identify a 

band within which the agency’s performance can be 

reasonably expected to vary. From this perspective, 

, 

setting the range at too high a level could be detrimental 

if the effect were to deter the agency from bringing 

important, but risky, cases, while setting the range at 

too low a level could be detrimental as well, if the effect 

were to incentivize the agency to bring marginal cases.

Of the remaining measures under this objective, six 

relate directly to Performance Measure 2.1.1 in that 

they measure the impact of the agency’s actions, in 

terms of the magnitude of the affected markets and the 

associated consumer benefits, as well as the efficiency 

with which these same actions were undertaken. 

Whereas the consumer savings measures are designed 

to assess the ultimate outcome, or impact, of the 

FTC’s actions in protecting consumers and promoting 

vigorous competition, by quantifying the impact of the 

FTC’s enforcement actions on consumer welfare, the 

volume of commerce measures are intended to give an 

indication of the economic significance of the relevant 

product markets.

For both merger and nonmerger actions, the FTC 

measures the volume of commerce and estimates 

consumer savings in markets in which it obtains a 

positive result as an indicator of the scope of the FTC’s 

antitrust enforcement activities. External factors, such 

as level of merger activity, and internal ones, such as 

the duration of nonmerger investigations, may cause 

these results to fluctuate significantly from year to year. 

Consequently, the two volume-of-commerce targets 

(Performance Measures 2.1.3 and 2.1.6) and the two 

consumer savings targets (Performance Measures 2.1.2 

and 2.1.5) are assessed each year by calculating the 

average of current year plus the previous four years. 

In addition to measuring consumer savings in absolute 

terms, the agency uses efficiency measures that state 

the FTC will try to save consumers more than the 

amount of agency resources allocated to the merger and 

nonmerger programs (Performance Measures 2.1.4 and 

2.1.7).

The final measure under this objective addresses 

the international dimension of the agency’s law 

enforcement efforts by tracking the percentage of cases 

in which the FTC had at least one substantive contact 

with a foreign antitrust authority in which the agencies 

followed consistent analytical approaches and reached 

compatible outcomes.
75performance section

fiscal year 2012

2014 Target 40.0–60.0% TarGeT MeT. 

The agency took action to maintain competition in 25 of the 58 

substantial merger and nonmerger investigations that were closed 

in FY 2012. These 25 actions consist of 19 consents, five merger 

2013 Target 40.0–60.0% transactions that were withdrawn or abandoned as a consequence 

of the antitrust concerns raised during the investigation, and one 

matter won on appeal. This corresponds to 20 merger matters and five 

nonmerger matters. 

On the merger side this includes successful second request or 

Target 40.0–60.0% compulsory process investigations in matters involving, for example, 

pharmaceuticals (Valeant/OrthoDermatologists/Dermik Laboratories, 

and Teva/Cephalon), hospitals, long-term care pharmacies, and 

2012 physician groups (Rockford Memorial/St. Anthony Medical Center, 

Omnicare/PharMerica and Renown Health/Reno Heart Physicians), 

high technology (Western Digital/Hitachi), manufacturing (Graco/

actual 43.1% Illinois Tool Works) and energy mergers (Kinder Morgan/El Pasoand 

Amerigas/ETP).

On the nonmerger side, the FTC took action against anticompetitive 

tactics that harmed consumers by thwarting competition. In November 

2011, the FTC issued a settlement order prohibiting PoolCorp (the 

U.S.’s largest swimming pool products distributor) from restricting the 

Target 40.0–60.0% purchase or sale of pool products to any other distributor. In August 

2012, the FTC settled price-fixing charges with a group of pharmacy 

owners in Puerto Rico. Also, in FY 2012 the FTC successfully concluded 

2011 its litigation against Realcomp II Ltd. (a Michigan-based realtor group) 

when the U.S. Supreme Court denied Realcomp’s request to reconsider 

an FTC finding that the realtor group violated competition law by 

restricting the publication of certain low-cost real estate listings. The 

actual 34.1%* denial leaves in place a Sixth Circuit ruling from April 2011 backing the 

FTC’s decision that Realcomp’s policy of blocking nontraditional, lowcost listings from being published through their realtor data service 

narrowed consumer choice and hindered the competitive process by 

improperly limiting consumers’ access to information about those 

properties. 

Target 40.0-60.0% Of the 33 substantial investigations that were closed without an action, 

which includes litigation losses, 21 involved a nonmerger matter and 12 

a merger matter.

2010 *This is a correction to results reported in the FY 2011 PAR. The results 

should have been based on 15 out of 44 cases, or 34%. The FY 2011 PAR 

reports actuals on 14 of 44 cases, or 32%.

actual 40.0%
performance section

76 Federal Trade Commission | Performance and Accountability Report 

2014 Target $500.0

TarGeT exceeded. 

In FY 2012, the FTC has saved consumers an estimated 

$504.9 million, as calculated using the average consumer 

savings for the current fiscal year and the previous four 

years.

* This is a correction to results reported in the FY 2011 

PAR. The results should have been based on a savings 

of $532.2 (million). The FY 2011 PAR reports savings of 

$531.5 (million).

2013 Target $500.0

2012

Target $500.0 

actual $504.9

2011

Target $500.0 

actual $532.2*

2010

Target $500.0

actual $586.0

2009

Target $500.0

actual $791.0

2008

Target $500.0

actual $360.0

2007

Target $500.0

actual $805.0

2006

Target n/a

actual n/a
77performance section

fiscal year 2012

PERFORMANCE MEASURE 2.1.3 

aCtions against mergers likely to harm ComPetition in markets with a total of 

at least $25 Billion in sales. (outCome measure - numBers shown in Billions)

2014 Target $25.0

TarGeT NOT MeT. 

2013 Target $25.0 The FTC’s positive merger results affected markets in which t

volume of commerce was approximately $20.2 billion, or 80.8

annual target, as calculated using the average of the current Target $25.0 commerce year and the previous four years. During FY 2012, 2012 positive results in 20 merger matters, resulting in 15 consent 

actual $20.2 five transactions that were either abandoned or restructured 

antitrust concerns raised by staff during the course of the inv

Target $25.0 case of consent agreements, the actions taken by the FTC co

structural remedies, accompanied in some cases by conditio 2011 future conduct of the merged entity. actual $22.7

It should be noted that there were four additional merger inv

which were resolved with a consent, fix-it-first, restructured, Target $25.0 transactions, but were excluded from this measure because t

2010 involve the use of compulsory process.

actual $22.5

Target $25.0

2009

actual $22.3

Target $25.0

2008

actual $14.9

Target $25.0

2007

actual $42.6

Target $40.0

2006

he total estimated 

% of the 

fiscal volume of 

the FTC obtained 

agreements, and 

based on the 

estigation. In the 

nsist primarily of 

ns restricting the 

estigations, 

or abandoned 

hey did not 

Actual $13.
performance section

78 Federal Trade Commission | Performance and Accountability Report 

2014 *Target 1300.0%

TarGeT exceeded. 

During FY 2012, the agency saved consumers over 14 times the amount of 

resources devoted to the merger program, as calculated using the five-year 

average consumer savings obtained under Performance Measure 2.1.2 ($504.9 

million) divided into the amount of resources used in the current fiscal year. 

This result is in large part determined by the presence of several enforcement 

actions over the last four years in the pharmaceutical industry, which involved 

significantly sized relevant product markets.

* Targets for FY12 - FY14 were increased based on projected future 

performance as reported in the FTC’s FY 2012 Strategic Plan Addendum.

** This is a correction to results reported in the FY 2011 PAR. The results should 

have been based on a savings of $532.2 (million), or 1419%. The FY 2011 PAR 

reports savings of $531.5 (million), or 1417%.

2013 *Target 1300.0%

2012

*Target 1300.0%

actual 1,492.4%

2011

Target 600.0%

actual 1,419.0**%

2010

Target 600.0%

actual 1,670.0%

2009

Target 600.0%

actual 2,132.0%

2008

Target 600.0%

actual 1,121.0%

2007

Target 600.0%

actual 2,500.0%

2006

Target n/a

actual n/a
79performance section

fiscal year 2012

2014 *Target $450.0

TarGeT NOT MeT. 

In FY 2012, the FTC obtained estimated savings to consumers of 

approximately $439.8 million, as calculated using the average consumer 

savings of the current fiscal year and the previous four years. 

In FY 2011 and FY 2010, the agency exceeded the target on this measure by 

more than 455%, and 533% respectively. The reason that the agency exceeded 

the target by such a large margin is attributable to one particular case, which 

involved Intel Corporation, the world’s leading computer chip maker, who was 

charged with illegally using its dominant market position for a decade to stifle 

competition and strengthen its monopoly. The targets for FY 2012 through FY 

2014 were modified in response to the agency greatly exceeding the target 

due to this case. Therefore, subsequent years’ results may not meet the target. 

Additionally, nonmerger/conduct cases historically take a longer time than 

merger cases to investigate and bring to a final enforcement action. For 

example, we are currently in the midst of litigation in four nonmerger cases 

which did not conclude in FY 2012. In the coming years, the FTC will consider 

whether the new targets were appropriately set.

* Targets for FY12 - FY14 were increased based on projected future 

performance as reported in the FTC’s FY 2012 Strategic Plan Addendum.

2013 *Target $450.0

2012

*Target $450.0

actual $439.8

2011

Target $80.0 

actual $444.9

2010

Target $80.0

actual $508.0

2009

Target $80.0

actual $188.0

2008

Target $80.0

actual $28.0

2007

Target $80.0

actual $75.0

2006

Target n/a

actual n/a
performance section

80 Federal Trade Commission | Performance and Accountability Report 

2014 *Target $12.0

TarGeT NOT MeT. 

The FTC’s positive nonmerger results affected markets 

in which the total estimated volume of commerce was 

approximately $11.7 billion. During FY 2012, the FTC 

obtained positive results in four nonmerger matters. 

In FY 2011 and FY 2010, the agency exceeded the target on 

this measure by more than 45% each year. As mentioned 

under Performance Measure 2.1.5, the reason the agency 

had exceeded the target by such a margin is in large part 

attributable to one particular case, which involved Intel 

Corporation. The targets for FY 2012 through FY 2014 were 

modified in response to the agency greatly exceeding the 

target due to this case. Therefore, subsequent years’ results 

may not meet the target under this measure. 

Additionally, as mentioned in Measure 2.1.5, nonmerger/

conduct cases historically take a longer period of time 

than merger cases to investigate and bring to a final 

enforcement action. For example, we are currently in the 

midst of litigation in four nonmerger cases which did not 

conclude in FY 2012.

In the coming years, the FTC will consider whether the new 

targets were appropriately set.

* Targets for FY12 - FY14 were increased based on projected 

future performance as reported in the FTC’s FY 2012 

Strategic Plan Addendum.

2013 *Target $12.0

2012

*Target $12.0

actual $11.7

2011

Target $8.0

actual $11.6

2010

Target $8.0

actual $11.7

2009

Target $8.0

actual $14.6

2008

Target $8.0

actual $0.4

2007

Target $8.0

actual $2.6

2006

Target $20.0

actual $1.4
81performance section

fiscal year 2012

2014 *Target 2000.0%

TarGeT NOT MeT. 

During FY 2012, as in FY 2011 and FY 

2010 where the agency greatly exceeded 

its target, the agency saved consumers 

over 18 times the amount of resources it 

devoted to the nonmerger enforcement 

program. As mentioned under 

Performance Measure 2.1.5, the reason 

the agency had previously exceeded the 

target by such a margin is in large part 

attributable to one particular case, which 

involved Intel Corporation. The targets for 

FY 2012 through FY 2014 were modified in 

response to the agency greatly exceeding 

the target due to this case. Therefore, 

subsequent years’ results may not meet 

the target under this measure. 

Additionally, as mentioned in Measure 

2.1.5, nonmerger/conduct cases historically 

take a longer period of time then merger 

cases to investigate and bring to a final 

enforcement action. For example, we are 

currently in the midst of litigation in four 

nonmerger cases which did not conclude 

in FY 2012.

In the coming years, the FTC will 

consider whether the new targets were 

appropriately set.

* Targets for FY12 - FY14 were increased 

based on projected future performance 

as reported in the FTC’s FY 2012 Strategic 

Plan Addendum.

2013 *Target 2000.0%

2012

*Target 2000.0%

actual 1831.7%

2011

Target 400.0%

actual 1917.7%

2010

Target 400.0%

actual 2418.0.0%

2009

Target 400.0%

actual 1,035.0%

2008

Target 400.0%

actual 164.0%

2007

Target 400.0%

actual 424.0%

2006

Target n/a

actual n/a

2014 Target 90.0%

TarGeT exceeded. 

2013 Target 90.0% In FY 2012, the FTC had 51 substantive 

contacts in 26 enforcement matters 

with counterpart agencies around the 

Target 90.0% world including in Australia, Canada, 

2012 China, France, Germany, Japan, Korea, 

Mexico, Singapore, Turkey, and the United 

actual 100.0% Kingdom. The reviewing agencies reached 

compatible outcomes in the 15 cases that 

were completed within the fiscal year. While 

the agency will continue to strive for 100% 

success, the target reflects the possibility 

2011 of inconsistent outcomes, particularly as 

Target 90.0%

actual 100.0% new antitrust agencies begin to assert their 

jurisdiction. 

The agency will continue to monitor the 

Target 90.0% target of this relatively new measure and 

will reassess it after additional performance 

2010 cycles.

actual 100.0%
performance section

82 Federal Trade Commission | Performance and Accountability Report 

in this area. The FTC advocates market-based solutions 

through the publication of studies and reports, 

and participation in state and federal legislative and 

regulatory fora.

The agency also participates as an amicus curiae 

(friend of the court) in judicial proceedings when 

substantial questions of antitrust law or competition 

policy are involved, especially when the FTC may add a 

different perspective to the deliberations because of its 

specialized knowledge or experience.

Finally, in an effort to continue educating consumers 

and businesses on the important role of competition in 

providing the most valuable and efficient mix of price, 

choice, and innovation, the FTC continues to publish 

reference and case-related documents. Another way 

the FTC achieves this goal is to improve how topical 

information, case materials, and reference documents 

are organized on its web site in an effort to aid visitors 

in searching for and finding relevant information and 

to continuously update the growing body of reference 

material.

Performance Results

The FTC uses one measure to assess its performance 

in preventing consumer injury through education. 

The key measure (Performance Measure 2.2.1) tracks 

the volume of traffic on the FTC website on antitrustrelated pages that are relevant to policymakers, the 

business and legal communities, and the public at 

large. This performance measure is an indicator of 

the flow of information provided to the public. 

Successful outreach and education efforts, as reflected 

by this measure, will help consumers, because increased 

knowledge and understanding of the antitrust laws will 

help businesses stay in compliance. This measure also 

will help ensure that the agency engages in consumer, 

business, and international education that advances 

the culture of competition, which enhances consumer 

welfare. 

The results of this measure would seem to indicate a 

significant continued public interest in the FTC and its 

Maintain Competition strategic goal. In addition, the 

broad and increasing distribution of educational and 

policy materials through electronic channels represents 

important leveraging of the agency’s resources.
83performance section

fiscal year 2012

kEY MEASURE 2.2.1 

ComPetition resourCes aCCessed via the ftC’s weBsite. (outPut measure - 

numBers shown in millions)

2014 *Target 24.0

TarGeT NOT MeT.

During FY 2012, the FTC’s online competition resources 

registered nearly 23.2 million hits. These resources include 

pages that relate to individual investigations (such as 

complaints, orders, comments, and press releases), policy 

and research oriented content (such as reports, policy 

guides, and fact sheets, workshop or conference webpages, 

the online competition enforcement database, advocacy 

filings, and amicus briefs), and business and consumer 

education material.

In FY 2011, the agency exceeded the target on this 

measure by more than 100 percent. Accordingly, higher 

targets were set for FY 2012 through FY 2014 based on 

past performance. The FTC will consider whether the new 

targets were appropriately set.

* Targets for FY12 - FY14 were increased based on projected 

future performance as reported in the FTC’s FY 2012 

Strategic Plan Addendum.

2013 *Target 24.0

2012

*Target 24.0

actual 23.2

2011

Target 10.0

actual 22.6

2010

Target 10.0

actual 21.5

2009

Target 15.0

actual 11.9

2008

Target 15.0

actual 12.5

2007

Target 15.0

actual 15.7

2006

Target 10.0

actual 10.6
performance section

84 Federal Trade Commission | Performance and Accountability Report 

strategy to enhance consumer welfare. The agency 

uses the information it develops internally to refine 

the theoretical framework for analyzing competition 

issues and the empirical understanding of industry 

practices, which contributes substantially to an effective 

response to changing marketplace conditions. The 

information gained through this authority, combined 

with the agency’s professional expertise on competition 

issues, also contributes to a better understanding of 

business practices and their competitive and economic 

implications by various entities, including the business 

sector, the legal community, other enforcement 

authorities, the judiciary, foreign competition agencies, 

and governmental decision makers and policymakers 

at the federal, state, and local levels. And finally, the 

FTC files comments with federal and state government 

bodies advocating policies that promote the interests 

of consumers and highlight the role of consumer and 

empirical research in their decision making. The FTC 

also files amicus briefs to aid courts’ considerations of 

consumer protection issues.
85performance section

fiscal year 2012

Performance Results

The key measures used to gauge the FTC’s 

success under this objective are the ones relating 

to conducting public hearings, conferences, and 

workshops (Performance Measure 2.3.1), issuing 

reports and studies on competition related issues 

(Performance Measure 2.3.2), and making advocacy 

filings (Performance Measure 2.3.3). These measures, 

in conjunction with Performance Measures 2.3.

.3.5, help to ensure that the agency is engaging

ppropriate types and sufficient levels of resear

eports, and advocacy and that they are relevant

onsumers, policymakers, businesses, and the le

ommunity. The target for these measures sets 

inimum level of activity that the agency is ex

chieve.

4, and 

2 in 

a ch, 

r to 

c gal 

c a 

m pected to 

a

kEY MEASURE 2.3.1 

workshoPs, seminars, 

ConferenCes, and 

hearings Convened 

or CosPonsored that 

involve signifiCant 

ComPetition-related 

issues. (outPut measure)

2014 Target 4

TarGeT NOT MeT. 

During FY 2012, the FTC held three 

competition and economics-related 

conferences. Held annually in November, 

the FTC’s Microeconomics Conference 

brings together scholars and leaders 

from universities throughout the world, 

other government agencies, and other 

organizations to discuss antitrust, 

consumer protection, and policy issues 

which FTC economists encounter in their 

work. During FY 2012 the FTC organized 

a conference on the economics of drip 

pricing. 

Additionally, in September 2012, the 

FTC hosted a joint conference with 

the Department of Justice’s Antitrust 

Division on most-favored-nation clauses 

(MFNs), which explored the use of 

MFN clauses and the implications for 

antitrust enforcement and policy. The 

most commonly used MFN provisions 

guarantee a customer that it will receive 

prices that are at least as favorable as 

those provided to other buyers of the 

same seller, for the same products or 

services. 

Although the agency did not meet the 

target in FY 2012, it should be noted 

that a fourth conference, the planning 

and organization for which was done in 

FY 2012, was held on October 2, 2012 

to discuss competition and consumer 

protection issues in the pet medications 

industry.

2013 Target 4

2012

Target 4

actual 3

2011

Target 4

actual 4

2010

Target 4

actual 6

2009

Target 4

actual 8

2008

Target 4

actual 5

2007

Target 4

actual 7

2006

Target n/a

actual n/a
performance section

86 Federal Trade Commission | Performance and Accountability Report 

kEY MEASURE 2.3.2 

rePorts and studies 

issued on key 

ComPetition-related 

toPiCs. (outPut measure)

2014 Target 8

TarGeT exceeded. 

During FY 2012, the FTC published 

working papers on the economics of 

competition, market structures, and 

organizational form. The FTC also 

published reports covering health care 

and energy. Additionally, the agency 

filed two annual reports, one recognizing 

the agency’s continued efforts to 

protect consumers and competition, and 

the Hart-Scott-Rodino Annual Report on 

the premerger notification program and 

merger enforcement.

2013 Target 8

2012

Target 8

actual 9

2011

Target 8

actual 11

2010

Target 8

actual 9

2009

Target 8

actual 20

2008

Target 8

actual 7

2007

Target 8

actual 18

2006

Target n/a

actual n/a
87performance section

fiscal year 2012

kEY MEASURE 2.3.3 

advoCaCy Comments 

and amiCus Briefs on 

ComPetition issues filed 

with entities inCluding 

federal and state 

legislatures, agenCies or

2014 *Target 10

TarGeT exceeded. 

2013 *Target 10 In FY 2012, the FTC filed advocacy 

comments and amicus briefs on 

competition issues such as pay-fordelay pharmaceutical settlements, 

the regulation of medical, dental, and 

*Target 10 veterinary professionals, the intersection 

of competition and intellectual property 

2012 law, electricity, and the agency’s Funeral 

Rule.

The target for filing competitionactual 18 related briefs and comments was 

increased to ten because the agency 

had greatly exceeded the target in 

both FY 2010 and 2011. The agency 

exceeded the FY 2012 target as well. 

Target 6 These performance results highlight the 

inherent unpredictability of the types 

of and number of competition issues 

2011 that might arise before federal and state 

actual 16

government bodies and therefore the 

types of comments and briefs that the 

agency might file in response.

The agency will continue to monitor the 

target of this relatively new measure 

and will reassess it after additional 

Target 6 performance cycles.

* Targets for FY12 - FY14 were increased 

2010 based on projected future performance 

as reported in the FTC’s FY 2012 

Strategic Plan Addendum. actual 17

Courts. (outPut measure)
performance section

88 Federal Trade Commission | Performance and Accountability Report 

PERFORMANCE 

MEASURE 2.3.4 

the PerCentage of 

resPondents finding 

the ftC’s advoCaCy 

Comments and amiCus 

Briefs “useful.” (outCome 

measure)

2014 *Target 75.0%

TarGeT exceeded. 

The FTC mails advocacy recipients 

a survey designed to gauge the 

2013 *Target 75.0%

2012

*Target 75.0%

usefulness of agency advocacy 

comments and amicus briefs. 

“Usefulness” is assessed by the 

actual 83.3% recipient. The target percentage 

recognizes that comments critiquing 

2011

Target 50.0%

a recipient’s proposed action may not 

be assessed positively. In FY 2012, 5 of 

6 survey responses classified the FTC’s 

submissions as useful. The agency 

actual 100.0% will continue to monitor the target of 

this relatively new measure and will 

reassess it after additional performance 

cycles.

* Targets for FY12 - FY14 were 

increased based on projected future 

performance as reported in the FTC’s 

FY 2012 Strategic Plan Addendum.

2010

Target 50.0%

actual 100.0%
89performance section

fiscal year 2012

the ftC BloCks 

antiComPetitive 

hosPital mergers

Preserving competition in the health care 

industry is important to the FTC. In 2012, the 

Commission ruled that ProMedica Health 

System, Inc.’s consummated acquisition of rival 

St. Luke’s hospital in Lucas County, Ohio, was 

anticompetitive and would likely result in higher health care costs for patients, employers, and 

employees. The Commission’s order requires ProMedica to divest St. Luke’s Hospital to an FTCapproved buyer.

In a second case, the FTC secured a preliminary injunction in Federal District Court blocking 

OSF Healthcare System’s acquisition of rival health care provider Rockford Health System. The 

FTC alleged that the merger would raise prices for hospital services in Rockford, Illinois. OSF 

abandoned its acquisition plans after the district court ruling.

Finally, the Supreme Court recently agreed that this fall it will hear arguments in the FTC’s 

challenge to Phoebe Putney Health System, Inc.’s proposed acquisition of its sole rival in Albany 

Georgia, Palmyra Park Hospital, Inc. The FTC and the Attorney General of the State of Georgia 

allege that the deal will create a monopoly and allow the combined Phoebe/Palmyra to raise 

prices for general acute-care hospital services charged to commercial health plans, harming 

patients and local employers and employees. 

PERFORMANCE 

MEASURE 2.3.5 

the volume of traffiC on 

www.ftC.gov relating to 

ComPetition researCh, 

rePorts, and advoCaCy. 

(outPut measure – 

numBers shown in 

millions)

2014 Target 1.7

TarGeT exceeded. 

This performance measure relates 

to the volume of traffic on the FTC’s 

web pages that relate to competition 

research, reports, and advocacy. In FY 

2012, approximately 3.4 million visits met 

the criteria set by this measure.

2013 Target 1.7

2012

Target 1.7

actual 3.4

2011

Target 1.7

actual 1.8

2010

Target 1.7

actual 2.2

2009

Target 1.1

actual 1.6

2008

Target 1.1

actual 1.2

2007

Target 1.1

actual 1.1

2006

Target n/a

actual n/a
performance section

90 Federal Trade Commission | Performance and Accountability Report 

initiatives. The FTC also pursues the development of 

an international market-based competition model that 

focuses on the maximization of consumer benefit. 

The agency influences policy development and 

implementation by advising multilateral organizations, 

regional entities, and foreign government agencies 

through substantive consultations and written 

comments. And finally, the FTC provides technical 

assistance to newer competition agencies to enhance 

their ability to apply sound competition policies. 

Performance Results

The FTC uses two performance measures to assess 

performance for this objective. Key Measure 2.4.1 

and Performance Measure 2.4.2 address the scope of 

our contact with international counterparts and help 

determine if our efforts are sufficiently broad-based.

ftC Joines aPeC 

Cross-Border PrivaCy 

rules system

In July 2012, the Asia Pacific Economic 

Cooperation (APEC) approved the United States 

as the first participant in the Cross-Border Privacy 

Rules System, and named the FTC as its first 

privacy enforcement authority. The APEC privacy system is a cross-border initiative designed to 

enhance the protection of consumer data that moves between the United States and other APEC 

members, through a voluntary but enforceable code of conduct implemented by participating 

businesses. President Obama and representatives from the other APEC economies endorsed the 

system in November 2011 “to reduce barriers to information flows, enhance consumer privacy, 

and promote interoperability across regional data privacy regimes.” The FTC, the Department of 

Commerce, U.S. corporations, and privacy advocacy organizations worked together with their 

counterparts in other APEC economies to formulate the APEC privacy rules. These rules will 

be enforced pursuant to the APEC Cross-Border Privacy Enforcement Arrangement, which is a 

multilateral mechanism that facilitates information sharing and assistance for cross-border data 

privacy enforcement. In addition to the United States, the 21 APEC members include Australia, 

Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Korea, Malaysia, Mexico, New Zealand, 

Papua New Guinea, Peru, the Philippines, Russia, Singapore, Taiwan, Thailand, and Vietnam.
91performance section

fiscal year 2012

kEY MEASURE 2.4.1 

PoliCy adviCe Provided 

to foreign ComPetition 

agenCies, direCtly and 

through international 

organizations, 

through suBstantive 

Consultations, 

written suBmissions, 

or Comments. (outPut 

measure) 

2014 *Target 60 TarGeT exceeded. 

In FY 2012, the FTC provided policy 

advice to foreign competition 

agencies in over 100 instances through 

2013 *Target 60 consultations, written submissions, or 

comments. The FTC’s policy advice 

remains highly regarded and sought 

after by new and more experienced 

*Target 60 competition agencies, including in 

international fora.

2012 * Targets for FY12 - FY14 were increased 

actual 146

based on projected future performance 

as reported in the FTC’s FY 2012 

Strategic Plan Addendum.

Target 40

2011

actual 112

Target 40

2010

actual 76

PERFORMANCE 

MEASURE 2.4.2 

teChniCal assistanCe 

Provided to foreign 

ComPetition authorities. 

(outPut measure)

2014 Target 10

TarGeT exceeded. 

In FY 2012, the FTC conducted 21 

2013 Target 10 technical assistance missions and hosted 

six international Fellows. Thirteen of 

the technical assistance missions and 

two international Fellows were funded 

Target 10 through outside sources such as the U.S. 

2012 Agency for International Development 

and the U.S. Trade and Development 

actual 27 Agency.

Target 10

2011

actual 27

2010

Target 10

actual 60
performance section

92 Federal Trade Commission | Performance and Accountability Report 

RESOURCES UTILIZED—ST

(DOLLARS SHOwN IN MILLIONS.)

2

2007 2008 2009 2010 2011 2012

Full-Time 

Equivalents 489 502 509 512 522 506

Obligations $94 $103 $113 $123 $123 $119

Net Cost ($47) $2 $68 $43 $43 $33

Note: Differences between these obligations and net costs and the financial statements are due to rounding.
93performance section

fiscal year 2012

GOAL 3: ADVANCE

PERFORMANCE 

Advance the FTC’s Performance Through 

Organizational, Individual, And Management 

Excellence.

I. Strategic View

The FTC recognizes that a strong foundation of 

organizational, individual, and management excellence 

is a driver of mission success. The agency applies 

four objectives to achieve this goal. The objectives 

align with four key functional areas: human resources, 

infrastructure and security, information resources, and 

finance and acquisition.

oBJeCtive 3.1: Provide effeCtive human 

resourCes management.

The FTC uses an integrated approach that ensures 

human capital programs and policies are linked to 

our mission, goals, and strategies, while providing for 

continuous improvement in efficiency and effectiveness.
performance section

94 Federal Trade Commission | Performance and Accountability Report 

Our Strategy

The FTC recognizes that its employees are its 

greatest asset and places great emphasis on the 

importance of human resources management to the 

successful accomplishment of its mission. One of 

the key strategies used to achieve this objective entail

implementing programs and processes that will enabl

the agency to recruit quickly, develop, and retain a 

qualified, diverse workforce through an integrated 

workforce plan. The FTC also uses the integrated 

workforce plan to identify and fulfill current and futu

human resources needs to carry out its mission and 

creates an agency-wide performance culture focused 

on individual and organizational accountability towar

the achievement of the FTC’s programmatic goals an

priorities. Finally, the agency achieves this objective b

providing human resources management training and

outreach to staff.

The agency continues to enhance its performance 

culture focused on accountability toward achieving th

FTC’s programmatic goals and priorities. In FY 2012,

we revised the employee performance management 

system and implemented new performance standards

agency-wide to help employees better understand ho

their work contributes to the organization’s ability to 

achieve its goals and fulfill its mission. The revised 

system encourages rating officials to select and focus 

on those Strategic Plan goals and objectives that are 

most relevant to an employee’s performance and 

formalize the connection in the performance plan. 

The employee performance plan and appraisal form 

was also updated to show how each employee’s plan 

links to the agency’s Strategic Plan, Chairman’s goals 

and initiatives, Bureau or Office objectives and 

initiatives, or other management or accountability 

initiatives in support of the FTC mission. 

Rating officials are responsible for describing the 

relationship between the employee’s principle duties 

andresponsibilities and the agency’s goals and objecti

or the Bureau or Office organizational goals and 

objectives. In this way, the FTC focuses on duties 

that contribute toward accomplishing organizational 

goals and objectives, ensures that each employee’s 

performance plan aligns with the agency’s goals 

and objectives and furthers the objectives of the 

organization, and involves employees in management

ongoing effort to improve overall effectiveness in 

accomplishing the agency’s mission and goals.

s 

e 

re 

d 

d 

y 

e 

w 

ves 

’s 

Performance Results

Two performance measures, Performance Measure 

3.1.1 and Performance Measure 3.1.2, are used to 

gauge achievement of this objective. These measures 

are based on results from the Federal Employee 

Viewpoint Survey administered by the U.S. Office of 

Personnel Management. The survey focuses on federal 

employees’ perceptions of critical areas of their work 

life and workforce management, and measures factors 

that influence whether employees want to join, stay, 

and help their agency meet its mission. In FY 2012, the 

FTC had a survey response rate of 54.9 percent (541 of 

986 employees responded) and, compared to 37 other 

federal agencies with over 1,000 employees, received 

first place marks on Results-Oriented Performance 

Culture, third place marks on both Leadership and 

Knowledge Management and on Talent Management, 

and sixth place marks on Job Satisfaction. Of the 98 

items on the survey, the FTC had 59 items with high 

positive ratings that are considered strengths; and zero 

items with a negative rating that would be considered a 

challenge. Additionally, 65 items were five percentage 

points or more above the government-wide average, 

and only one item was five percentage points or more 

below the government-wide average.
95performance section

fiscal year 2012

PERFORMANCE MEASURE 3.1.1

the extent emPloyees Believe their organizational Culture Promotes 

imProvement in ProCesses, ProduCts and serviCes, and organizational outComes. 

(outCome measure)

2014 Target

Exceed the government-wide 

results on the Federal Human 

Capital Survey’s Results-Oriented 

Performance Culture Index

TarGeT MeT. 

The government-wide results were 52% and 

the FTC received 66%.

Exceed the government-wide Compared to 37 other departments and 

2013 Target results on the Federal Human 

Capital Survey’s Results-Oriented 

agencies with more than 1,000 full-time 

employees, the FTC took third place in 

Performance Culture Index Leadership and Knowledge Management and 

first place in Results-Oriented Performance 

Culture. exceed the government-wide 

Target results on the federal human 

Capital survey’s results-oriented 

Performance Culture index

2012

actual exceeded

exceed the government-wide 

Target results on the federal human 

Capital survey’s results-oriented 

Performance Culture index

2011

actual exceeded

exceed the government-wide 

Target results on the federal human 

Capital survey’s results-oriented 

Performance Culture index

2010

actual exceeded
performance section

96 Federal Trade Commission | Performance and Accountability Report 

kEY MEASURE 3.1.2 

the extent emPloyees think the organization has the talent neCessary to aChiev

organizational goals. (outCome measure)

e 

2014 Target

Exceed the government-wide results on 

the Federal Human Capital Survey’s Talent 

Management Index

TarGeT MeT. 

The government-wide results were 

59% and the FTC received 70%.

Compared to 37 other departments 

and agencies with more than 1,000 

full-time employees, the FTC took 

third place in Talent Management.

2013 Target

Exceed the government-wide results on 

the Federal Human Capital Survey’s Talent 

Management Index

2012

Target

exceed the government-wide results on 

the federal human Capital survey’s talent 

management index

actual exceeded

2011

Target

exceed the government-wide results on 

the federal human Capital survey’s talent 

management index

actual exceeded

2010

Target

exceed the government-wide results on 

the federal human Capital survey’s talent 

management index

actual exceeded

e 

Ensuring that the FTC has optimal information 

technology (IT) infrastructure operations and 

performance is key to meeting the agency’s business 

goals. The ability of the agency’s Office of the Chief 

Information Officer (OCIO) to deliver value to the 

agency is dependent upon its ability to identify and 

provide a host of critical services of improved quality, 

at lower business risk, and with increased agility. To this 

end, OCIO is working to deploy a sophisticated suite 

of infrastructure operations performance monitoring 

tools, technology, and processes that will help achieve 

the agency goals.

Measuring and improving service delivery to bring 

positive business experiences and outcomes for the 

FTC is imperative. With ever-changing technology, 

including the potential for use of cloud computing, 

this must be accomplished in a growing, complex, and 

dynamic IT infrastructure and application environment.
97performance section

fiscal year 2012

Performance Results

Two performance measures are used to gauge 

achievement of this objective. First, the FTC utilizes 

a comprehensive program comprised of tests, training, 

and exercises to validate our COOP capabilities. 

The annual government-wide Eagle Horizon exercise 

serves to assess and validate all the components of 

continuity plans, policies, procedures, systems, and 

facilities used to respond to and recover from an 

emergency situation and identify issues for subsequent 

improvement. An analysis of the plan and exercise 

is conducted with a combination of Federal Emergency 

Management Agency (FEMA), self and peer review. 

An overall score is derived for the exercise using 

the average numeric rating for each element of the 

review. The FTC’s target is based on prior performance 

and the target of 75 percent represents management’s 

commitment to reaching a realistic yet ambitious 

milestone. 

A second Performance Measure, Key Measure 3.2.2, 

assesses performance of this objective by collecting and

tracking the availability of key information technology 

applications, systems, and components. By tracking 

unplanned outage periods, the agency monitors the 

reliability and availability of 31critical information 

technology services.

kEY MEASURE 3.2.1 

a favoraBle Continuity of oPerations (CooP) rating. (outPut measure)

2014 Target 75.0%

TarGeT exceeded.

2013 Target 75.0% The FTC’s overall score of 90% for the Eagle Horizon 2012 Exercise reflects the 

strong overall commitment and continued support of the FTC COOP. Continued 

2012

Target 75.0% efforts to better define FTC’s essential functions and ensure that effective 

procedures are in place are reflected in the outstanding overall exercise score.

actual 90.0%

Target 75.0%

2011

actual 75.0%

Target 75.0%

2010

actual 85.0%
performance section

98 Federal Trade Commission | Performance and Accountability Report 

d 

, 

step in the transition, the FTC has developed an 

electronic recordkeeping certification review (ERC

process that is being used to review the ability of 

the FTC’s information systems to house agency 

records with authenticity, reliability, and integrity fo

the mandated retention period. During FY 2012, th

agency completed its review of and certified the M

Management System (a system that records, tracks, 

and reports administrative and statistical informatio

on FTC law enforcement and regulatory matters). 

In FY 2012, the FTC continued its review of Senti

Network Services (formerly the Consumer Respon

Systems and Services), a collection of online consu

protection services.

R) 

r 

e 

atter 

n 

nel 

se 

mer 

kEY MEASURE 3.2.2

availaBility of 

information teChnolog

systems. (outCome 

measure)

y 

2014 Target 99.50%

TarGeT exceeded. 

2013 Target 99.50% The FTC’s information technology 

services pool averaged 99.86% 

availability, exceeding the target of 

Target 99.00% 99.00%. During FY 2012, the FTC 

upgraded our network storage syst

2012 and continued making enhanceme

to our infrastructure-monitoring to

Completing these initiatives helped

actual 99.86% to facilitate expanding storage for t

FTC’s critical applications and also 

provided early warning notification

regarding changes to application 

Target 98.50% performance. Infrastructure Suppor

reflected by this performance metr

2011 is one of the OCIO’s strategic focus

areas. To maintain this level of supp

the OCIO will continue to replace actual 99.82% outdated hardware and software w

new components that provide grea

availability and quicker recovery.

Target 98.0% Note: Results for this performance 

measure are presented to two deci

because rounding the number 

2010

actual 99.77%

materially changes the result.

em 

nts 

ol. 

he 

s 

t, 

ic, 

ort, 

ith 

ter 

mals 
99performance section

fiscal year 2012

In addition, as part of effective information resources 

management, the FTC is identifying and implementing 

business process improvements through effective use of

technology. For example, the FTC has developed and 

is using a web based e-filing system for public filings in 

all administrative litigation proceedings under Part 3 of 

the FTC Rules of Practice. Designed in the footprint 

of systems used by the federal courts, the FTC’s e-filing 

system enables parties to the agency’s administrative 

proceedings to file public documents electronically 

rather than in paper format. 

Performance Results

One performance measure, Performance Measure 3.3.1, 

is used to gauge success of this objective. This key 

performance measure is the percentage of Commissionapproved documents in the FTC’s ongoing and newly 

initiated proceedings available on www.ftc.gov within 

15 days of becoming part of the public record. The 

FTC selected this measure because timely availability 

of public documents facilitates public awareness of and 

participation in Commission activities. Examples of 

documents approved by the Commission are Federal 

Register notices in rulemakings and other proceedings 

that seek public comments, consent agreements, 

complaints and orders in administrative litigation, 

and complaints and proposed orders in litigation in the 

federal courts.

kEY MEASURE 3.3.1

the PerCentage of 

Commission-aPProved 

doCuments in the ftC’s 

ongoing and newly 

initiated ProCeedings 

availaBle via the 

internet within 15 days 

of BeComing Part of the 

PuBliC reCord. 

(outPut measure)

2014 Target 80.0% TarGeT MeT. 

In FY 2012, the target for this 

performance measure increased to 

2013 Target 80.0% 80.0%. In FY 2012, 80.2% of documents 

tracked under this measure were 

posted to the Internet within 15 days 

of becoming part of the public record. 

Target 80.0% The performance actual is based on 

comprehensive counts as it was in FY 

2012 2011. The FTC does not plan to adjust 

the target for FY 2013.

actual 80.2%

Target 75.0%

2011

actual 82.0%

Target 75.0%

2010

actual 93.8%
performance section

100 Federal Trade Commission | Performance and Accountability Report 

were conducted as part of our Internal Control Review 

Plan established in FY 2010. These planned reviews 

of agency Bureaus and Offices occur at least once 

every three years. The objective of the reviews is to 

assist management in identifying high risk areas and 

implement appropriate risk management strategies 

where necessary. The third review was initiated on an 

ad hoc basis.

Performance Results

Three performance measures that assess internal 

administrative and programmatic operations and 

acquisition procedures are used to gauge the 

achievement of this objective. Performance Measure 

3.4.1 tracks the independent auditor’s financial 

statement audit results, and Key Measure 3.4.2 tracks 

the percentage of bureaus/offices that establish and 

maintain an effective, risk-based internal control 

environment. Strong internal controls over financial 

and business processes are critical to the integrity of the 

data reported through the financial reporting system. 

Performance Measure 3.4.3 monitors performance 

against the Small Business Administration’s 

government-wide small business procurement goals.
101performance section

fiscal year 2012

2014 Target Unqualified opinion on the 

financial statements TarGeT MeT. 

The agency received a “clean” opinion on its financial 

statements. The opinion is determined by the 

independent auditor’s review and tests of internal 

controls over operations and financial reporting and the 

auditor’s determination that the financial statements and 

notes are fairly presented.

2013 Target Unqualified opinion on the 

financial statements

2012

Target unqualified opinion on the 

financial statements

actual unqualified opinion

Target unqualified opinion on the 

financial statements

2011

actual unqualified opinion

Target unqualified opinion on the 

financial statements

2010

actual unqualified opinion
performance section

102 Federal Trade Commission | Performance and Accountability Report 

kEY MEASURE 3.4.2 

the PerCentage of 

Bureaus/offiCes that 

estaBlish and maintain 

an effeCtive, riskBased internal Control

environment. (outCome 

measure)

2013 Target 100.0%

TarGeT MeT. 

2012 Target 100.0% The agency’s components perform 

assessments of the internal controls 

that have been placed into operation Target 100.0% within their areas of responsibility. 

2011 These assessments address the 

“Standards of Internal Control” issued 

actual 100.0% by the Government Accountability 

Office and are documented. The 

Financial Management Office (FMO) 

Target 100.0% reviews the assessments and the 

Chairman considers these when 2010 preparing his annual Statement 

actual 100.0% of Assurance. These assessments 

submitted by the agency’s major 

components coupled with FMO’s review 

Target 100.0% provide the basis for the measurement 

of the effectiveness of the FTC’s risk2010 based internal control environment.

actual 100.0%

2014 Target 23.0%

TarGeT exceeded. 

This measure encompasses contracts 

to organizations classified as small 

2013 Target 23.0%

2012

Target 23.0% businesses in accordance with 

Federal Acquisition Regulation Part 

19 Small Business Programs. The FY 

2012 performance result reflects the 

agency’s full commitment to utilizing 

small businesses wherever possible 

based on the nature of the acquisition.

actual 57.7%

2011

Target 23.0%

actual 46.3% The agency has not raised the target 

for this performance measure because 

the target is established nationwide by 

the Small Business Administration.

2010

Target 23.0%

actual 58.9%
fiscal year 2012

financia 
financial section

104 Federal Trade Commission | Performance and Accountability Report 

I am pleased to once again present the Financial section

of this Performance and Accountability Report (PAR). 

This report serves as a snapshot of the progress we 

made in Fiscal Year (FY) 2012 and as a roadmap to 

performance in the future. During this fiscal year, the 

Federal Trade Commission (FTC) continued to protect 

consumers and promote competition while remaining 

fiscally responsible; FY 2012 marks the 16th consecutiv

year that the FTC has received an unqualified (clean) 

opinion on our financial statements. 

Our commitment to effective financial management and

to upholding high standards of accountability in FY 

2012 included the following key accomplishments: 

• Returning more than $36 million directly to 

consumers who were victims of fraud, following 

successful prosecution of defendants resulting in 

court-ordered judgments or settlements. 

• Receiving, for the fifth consecutive year, the 

association of Government Accountants’ 

Certificate of Excellence in Accountability 

Reporting, given to agencies with the most 

transparent, innovative, and user-friendly PARs. 

In 2012 the agency also received a “Best in Class” 

award for the most informative Performance 

Section. 

• Substantially exceeding the Small Business 

Administration’s Government-wide goal to ensure 

that small businesses get their fair share of work 

with the federal government by awarding over 57 

percent of “eligible dollars” to small businesses.

e 

• Continuing our record of no material 

weaknesses, significant control deficiencies, or 

nonconformances with the Federal Managers’ 

Financial Integrity Act and other applicable laws 

and regulations. 

• Establishing new procedures to further accelerate 

payments to small businesses (in accordance with 

guidance issued by the Office of Management and 

Budget) and achieving a prompt pay rate of 99.5 

percent for all invoices processed. 

This section also includes our financial information 

as of September 30, 2012 and shows, through our 

performance results, how we used our financial 

resources to protect consumers and maintain 

competition. 

Although budgets continue to be tight, our talented and 

dedicated staff remains committed to the importance 

of good financial management and cost-saving efforts 

that enhance operational efficiency. We will continue 

to strive for financial and performance management 

excellence to benefit American consumers.

Steven A. Fisher

Chief Financial Officer

November 15, 2012

MESSAGE FROM THE CHIEF

FINANCIAL OFFICER
105financial section

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106 Federal Trade Commission | Performance and Accountability Report 
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108 Federal Trade Commission | Performance and Accountability Report 
109financial section

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110 Federal Trade Commission | Performance and Accountability Report 
111financial section

fiscal year 2012

PRINCIPAL FINANCIAL STATEMENTS

FINANCIAL STATEMENT DESCRIpTIONS

A brief description of the five principal financial statements presented on the following pages is provided:

• Balance Sheet – Presents the combined amounts the agency had to use or distribute (assets) versus the 

amounts the agency owed (liabilities), and the difference between the two (net position).

• Statement of Net Cost – Presents the annual cost of agency operations. The gross cost less any offsetting 

revenue is used to determine the net cost.

• Statement of Changes in Net Position – Reports the accounting activities that caused the change in net 

position during the reporting period.

• Statement of Budgetary Resources – Reports how budgetary resources were made available and the status 

of those resources at fiscal year-end.

• Statement of Custodial Activity – Reports collections and their disposition by the agency on behalf of the 

Treasury General Fund and one other federal agency. The FTC acts as custodian and does not have use of 

these funds. 

The accompanying notes to the financial statements describe significant accounting policies as well as detailed 

information on select statement lines.
financial section

112 Federal Trade Commission | Performance and Accountability Report 

FEDERAL TRADE COMMISSION

BALANCE SHEET 

AS OF SEpTEMBER 30, 2012 AND 2011

(Dollars shown in thousands)

2012 2011

Assets (Note 2):

 Intragovernmental:

 fund balance with treasury (note 3) $ 192,786 $ 112,225 

 Investments (note 5) - 35,443 

 accounts receivable, net (note 6) 995 26 

 total intragovernmental 193,781 147,694 

 cash and other monetary assets (note 4) 28,360 44,944 

 accounts receivable, net (note 6) 30,991 11,374 

 General property and equipment, net (note 7) 18,385 19,371 

Total Assets $ 271,517 $ 223,383 

 Liabilities:

intragovernmental:

accounts payable $ 1,030 $ 444

other (note 9) 4,706 1,430

 total intragovernmental 5,736 1,874 

 accounts payable 8,353 15,416 

 accrued redress receivables due to claimants 27,219 11,229 

 redress collected but not yet disbursed 84,935 84,190 

 other (note 9) 16,520 17,478 

Total Liabilities (Notes 8 and 9) $ 142,763 $ 130,187 

 Net Position (Note 1(o)):

 cumulative results of operations - other funds 128,754 93,196 

Total Net Position $ 128,754 $ 93,196 

Total Liabilities and Net Position $ 271,517 $ 223,383 

The accompanying notes are an integral part of these statements.
113financial section

fiscal year 2012

FEDERAL TRADE COMMISSION

STATEMENT OF NET COST 

FOR THE YEARS ENDED SEpTEMBER 30, 2012 AND 2011

(Dollars shown in thousands)

2012 2011

Costs by Strategic Goal:

 protect consumers (pc) strategic goal:

 gross costs (note 12) $ 164,767 $ 169,334

 less: earned revenue (note 13) (13,794) (14,233) 

 net pc strategic goal costs 150,973 155,101 

 maintain competition (mc) strategic goal:

 gross costs (note 12) 121,287 129,315

 less: earned revenue (note 13) (87,825) (91,984) 

 net mc strategic goal costs 33,462 37,331 

Net Cost of Operations $ 184,435 $ 192,432

The accompanying notes are an integral part of these statements.
financial section

114 Federal Trade Commission | Performance and Accountability Report 

FEDERAL TRADE COMMISSION

STATEMENT OF CHANGES IN NET pOSITION

FOR THE YEARS ENDED SEpTEMBER 30, 2012 AND 2011

(Dollars shown in thousands)

 

 

2012 2011 

Cumulative Results of Operations:

 Beginning balance, adjusted $ 93,196 $ 87,650 

 Budgetary financing sources:

 appropriations used 210,267 186,219

 other financing sources (non-exchange): 

 Imputed financing 9,726 11,759 

 total financing sources 219,993 197,978 

 less: net cost of operations (184,435) (192,432) 

 net change 35,558 5,546 

Total Cumulative Results of Operations $ 128,754 $ 93,196 

Unexpended Appropriations:

 Beginning balance, adjusted $ - $ - 

 Budgetary financing sources:

 appropriations received 210,267 186,219 

 less: appropriations used (210,267) (186,219) 

 total Budgetary financing sources - - 

Total Unexpended Appropriations $ - $ - 

Net Position (Note 1(o)) $ 128,754 $ 93,196 

The accompanying notes are an integral part of these statements.
115financial section

fiscal year 2012

The accompanying notes are an integral part of these statements.

FEDERAL TRADE COMMISSION

STATEMENT OF BUDGETARY RESOURCES

FOR THE YEARS ENDED SEPTEMBER 30, 2012 AND 2011

(Dollars shown in thousands)

2012 2011

Budgetary Resources: 

 unobligated balance, brought forward, october 1 $ 20,575 $ 13,128 

 recoveries of prior year unpaid obligations 4,341 8,231 

 unobligated balance from prior year budget authority, net 24,916 21,359 

 appropriations 210,267 186,219 

 spending authority from offsetting collections 102,610 106,056 

Total Budgetary Resources $ 337,793 $ 313,634 

Status of Budgetary Resources: 

 obligations incurred (note 14): $ 280,015 $ 293,059 

 unobligated balance, end of period: 

 apportioned (note1(r)) 56,434 17,882 

 unapportioned 1,344 2,693 

 total unobligated balance, end of period 57,778 20,575 

Total Status of Budgetary Resources $ 337,793 $ 313,634 

Change in Obligated Balance: 

 unpaid obligations, brought forward, october 1 $ 87,672 $ 90,622 

 uncollected customer payments from federal sources, brought forward, october 1 (115) (320)

 obligated balance, start of year, net 87,557 90,302 

 obligations incurred (note 14): 280,015 293,059 

 outlays, gross (283,770) (287,778)

 change in uncollected customer payments from federal sources (983) 205 

 recoveries of prior year unpaid obligations (4,341) (8,231)

 obligated balance, end of period, net:

 unpaid obligations, end of period 79,576 87,672 

 uncollected customer payments from federal sources, end of period (1,098) (115)

 obligated balance, end of period, net $ 78,478 $ 87,557 

Budget Authority and Outlays, Net: 

 Budget authority, gross $ 312,877 $ 292,275 

 actual offsetting collections (101,627) (106,261)

 change in uncollected customer payments from federal sources (983) 205 

 Budget authority, net $ 210,267 $ 186,219 

 outlays, gross $ 283,770 $ 287,778 

 actual offsetting collections (101,627) (106,261)

 outlays, net 182,143 181,517 

 distributed offsetting receipts (15,478) (13,417)

 agency outlays, net $ 166,665 $ 168,100 
financial section

116 Federal Trade Commission | Performance and Accountability Report 

FEDERAL TRADE COMMISSION

STATEMENT OF CUSTODIAL ACTIvITY

FOR THE YEARS ENDED SEpTEMBER 30, 2012 AND 2011 

(Dollars shown in thousands)

 

 

 

PC MC 2012 2011

Revenue Activity (Note 17):

 sources of collections

 premerger filing fees (net of refunds) $ - $ 87,544 $ 87,544 $ 91,424 

 civil penalties and fines 6,602 - 6,602 23,275 

 redress (note 18) 15,261 - 15,261 13,177 

 other miscellaneous receipts 217 - 217 240 

 total cash collections 22,080 87,544 109,624 128,116 

 accrual adjustments 3,634 - 3,634 (9,908)

Total Custodial Revenue $ 25,714 $ 87,544 $ 113,258 $ 118,208 

Disposition of Collection (Note 17):

 transferred to others:

 treasury general fund $ 22,080 $ - $ 22,080 $ 36,692 

 department of Justice - 87,544 87,544 91,424 

 Increase/(decrease) in amounts yet to be transferred 3,634 - 3,634 (9,908)

Total Disposition of Collections $ 25,714 $ 87,544 $ 113,258 $ 118,208 

Net Custodial Activity $ - $ - $ - $ - 

The accompanying notes are an integral part of these statements.
117financial section

fiscal year 2012

NOTES TO THE FINANCIAL 

STATEMENTS

Note 1—Summary of Significant 

Accounting Policies 

(a) REpORTING ENTITY 

The Federal Trade Commission (FTC) is an 

independent United States Government agency, 

established by the Federal Trade Commission Act of 

1914. The FTC enforces a variety of federal antitrust 

and consumer protection laws. The agency is headed 

by five Commissioners, nominated by the President 

and confirmed by the Senate, each serving a seven-year 

term. The President chooses one Commissioner to act 

as Chairman. No more than three Commissioners can 

be of the same political party. 

The FTC has three major bureaus: The Bureau of 

Consumer Protection (BCP), which supports the 

strategic goal of protecting consumers, the Bureau of 

Competition (BC), which supports the strategic goal of 

maintaining competition, and the Bureau of Economics 

(BE), which supports both bureaus and strategic goals. 

Additionally, various Offices provide mission support 

functions and services. 

The majority of the FTC’s staff is located in 

Washington DC; however, the FTC’s regions cover 

seven geographic areas. The regional offices work 

with BCP and BC to conduct investigations and 

litigation; provide advice to state and local officials 

on the competitive implications of proposed actions; 

recommend cases; provide local outreach services 

to consumers and business persons; and coordinate 

activities with local, state, and regional authorities. 

The regional offices frequently sponsor conferences 

for small businesses, local authorities, and consumer 

groups. 

The financial statements and notes include the 

accounts of all funds under the FTC’s control. 

As further described throughout these notes, in 

addition to appropriations received for salaries and 

necessary expenses, the FTC maintains control over 

funds that are primarily comprised of proceeds derived 

from court ordered judgments and settlements held for 

subsequent distribution to approved claimants. These 

funds are considered non-entity and are reported as 

such on the Balance Sheet. 

(b) FUND ACCOUNTING STRUCTURE 

The FTC’s financial activities are accounted for using 

various funds (i.e., Treasury Account Symbols (TAS)). 

They include the following for which the FTC maintains 

financial records: 

general fund 

TAS 29X0100 consists of a salaries and expense 

appropriation used to fund agency operations and 

capital expenditures. Offsetting collections received 

during the year are also recorded in the general fund. 

(See Note 13 Exchange Revenues.) 

dePosit fund 

TAS 29X6013 consists of monies held temporarily by 

the FTC as an agent for others (e.g., redress funds) prior 

to distribution through the consumer redress program. 

susPense fund 

TAS 29F3875 consists of premerger filing fees collected 

by the FTC under the Hart-Scott-Rodino (HSR) 

Antitrust Improvement Act of 1976 that are distributed 

equally to the FTC as a funding source and to the 

Department of Justice (DOJ). (See Note 1(p) Revenues 

and Other Financing Sources). 

misCellaneous reCeiPt aCCounts 

TAS 29 1040 and TAS 29 3220 consist of civil penalties, 

redress disgorgements to the Department of the 

Treasury (Treasury) and other miscellaneous receipts 

that by law are not retained by the FTC. Cash balances 

are automatically transferred to the general fund of the 

Treasury at the end of each fiscal year. 
financial section

118 Federal Trade Commission | Performance and Accountability Report 

(c) BASIS OF ACCOUNTING AND 

pRESENTATION

The accompanying financial statements present the 

financial position, net cost of operations, changes in net

position, budgetary resources, and custodial activities of

the FTC. They have been prepared from the accounting

records of the FTC. These financial statements may 

differ from other financial reports submitted pursuant 

to the Office of Management and Budget (OMB) 

directives for the purpose of monitoring and controllin

the use of the FTC’s budgetary resources. 

As noted above, the FTC maintains a single fund to 

account for salaries and all necessary expenses. Further, 

there are no intra-entity transactions with any other 

fund (e.g., deposit fund) that would require eliminating 

entries to present consolidated statements. Accordingly, 

the statements are not labeled consolidated nor is the 

Statement of Budgetary Resources (SBR) presented as 

combined. 

Transactions are recorded on both an accrual accountin

basis and a budgetary accounting basis. Under the 

accrual method, revenues are recognized when earned, 

and expenses are recognized when a liability is incurred,

without regard to receipt or payment of cash. Budgetar

accounting facilitates compliance with legal constraints 

and controls on the use of Federal funds.

Assets, liabilities, revenues and costs are classified 

in these financial statements according to the 

type of entity associated with the transactions. 

Intragovernmental assets and liabilities are those due 

from or to other Federal entities. Intragovernmental 

revenues are earned from other Federal entities. 

Intragovernmental costs are payments or accruals due 

to other Federal entities. Transactions and balances not 

associated with Federal entities are classified as with the 

public.

The financial statements have been prepared in 

conformity with generally accepted accounting 

principles (GAAP) of the United States of America 

for federal entities and with the form and content of 

financial statements specified by the OMB Circular 

A-136, Financial Reporting Requirements (as revised 

August 2012). GAAP for federal entities incorporate 

the standards prescribed by the Federal Accounting 

Standards Advisory Board (FASAB). 

g 

g 

y 

(d) USE OF ESTIMATES 

The preparation of financial statements in conformity 

with GAAP requires management to make estimates 

and assumptions that affect the reported amounts 

of assets and liabilities at the date of the financial 

statements and the reported amounts of revenues and 

expenses during the reporting period. Actual results 

could differ from those estimates. 

(e) BUDGET AUTHORITY 

The Congress passes appropriations annually that 

provide the FTC with authority to obligate funds 

for necessary expenses to carry out mandated 

program activities. These funds are available until 

expended, subject to the OMB apportionment and to 

Congressional restrictions on the expenditure of funds. 

In addition, the FTC places internal restrictions on fund 

expenditures to ensure the efficient and proper use of 

all funds. Appropriated funding is derived from various 

revenues and financing sources. The SBR reflects the 

single general fund (i.e. TAS 29X0100) for which the 

FTC has budget authority. 

(f) ENTITY/NON-ENTITY ASSETS 

Assets that an agency is authorized to use in its 

operations are entity assets. Assets that an agency holds 

on behalf of another federal agency or a third party 

and are not available for the agency’s use are non-entity 

assets. 

(g) FUND BALANCE wITH TREASURY 

The FTC’s Fund Balance with Treasury (FBWT) 

includes appropriated funds, deposit funds for 

subsequent disbursement to claimants, and premerger 

filing fees awaiting disbursement to the DOJ. Funds 

are carried forward until such time as goods or services 

are received and payment is made. All cash receipts 

are deposited with the Treasury and all disbursements 

for payroll and vendor invoices are disbursed by the 

Treasury. 
119financial section

fiscal year 2012

(h) CASH AND OTHER MONETARY ASSET

The FTC’s consumer redress agents process claims 

and disburse redress proceeds to approved claimants. 

Upon approval of the redress office, amounts necessar

to cover current disbursement schedules are held as 

cash in interest bearing accounts. These funds are 

considered non-entity assets and are reported on the 

Balance Sheet along with an offsetting non-entity 

liability. 

(i) INvESTMENTS 

In protecting consumers, the FTC collects proceeds 

from defendants in accordance with court ordered 

judgments and settlement agreements for consumer 

redress and holds these proceeds in the deposit 

fund (TAS 29X6013) established with the Treasury. 

Under an agreement with the Treasury, the portion 

of such judgments and settlements that were not 

immediately needed for cash disbursements were 

invested in Treasury securities. These investments 

were considered non-entity assets and were reported 

on the Balance Sheet along with an offsetting 

non-entity liability. After performing an analysis of 

the yield versus the related costs, the FTC discontinued

this practice in August 2012 and all funds that were 

invested in Treasury securities were returned to FTC’s 

deposit fund as FBWT. 

(j) ACCOUNTS RECEIvABLE, NET 

Entity accounts receivable consist of amounts due 

from other federal entities and from current and 

former employees and vendors. Non-entity accounts 

receivable include uncollected civil monetary penalties 

imposed as a result of the FTC’s enforcement activities

and uncollected redress judgments. These non-entity 

accounts receivable are reported on the Balance Sheet 

along with an offsetting non-entity liability. 

Gross receivables are reduced to net realizable value 

by an allowance for uncollectible accounts. (See Note 

6 Accounts Receivable, Net.) 

s

y 

(k) ACCRUED LIABILITIES AND 

ACCOUNTS pAYABLE 

Accrued liabilities and accounts payable represent a 

probable future outflow or other sacrifices of resources 

as a result of past transactions or events. Liabilities 

are recognized when they are incurred, regardless 

of whether they are covered by budgetary resources. 

Liabilities cannot be liquidated without legislation 

that provides the resources to do so. In addition, 

the government, acting in its sovereign capacity, can 

abrogate the FTC liabilities (other than contracts). 

(See Note 8 Liabilities Not Covered by Budgetary 

Resources and Note 9 Other Liabilities.) 

(l) EMpLOYEE HEALTH BENEFITS AND 

LIFE INSURANCE 

FTC employees are eligible to participate in the 

contributory Federal Employees Health Benefit 

Program (FEHBP) and the Federal Employees 

Group Life Insurance Program (FEGLIP). The FTC 

contributes a percentage to each program to pay for 

current benefits. 

(m) EMpLOYEE RETIREMENT BENEFITS 

FTC employees participate in either the Civil Service 

Retirement System (CSRS) or the Federal Employees 

Retirement System (FERS). Employees hired after 

December 31, 1983, are covered by FERS and Social 

Security, while employees hired prior to January 1, 

1984, were allowed to elect joining FERS or remaining 

in CSRS. For employees participating in CSRS, the 

FTC contributes seven percent of the employee’s 

gross earnings to the CSRS Retirement and Disability 

Fund. For employees participating in FERS, the FTC 

contributes 11.9 percent to the Federal Employees’ 

Retirement Fund. Employees participating in FERS 

are covered under the Federal Insurance Contributions 

Act (FICA) for which the FTC contributes a matching 

amount to the Social Security Administration. FTC 

contributions are recognized as current operating 

expenses. 
financial section

120 Federal Trade Commission | Performance and Accountability Report 

The Thrift Savings Plan (TSP) is a defined contribution 

retirement savings and investment plan for employees 

covered by either CSRS or FERS. Participating 

employees may contribute any dollar amount or 

percentage of basic salary to the TSP, not to exceed 

an annual dollar amount of $17,000 for 2012. CSRS 

participating employees do not receive a matching 

contribution from the FTC. FERS employees receive 

an agency automatic one percent contribution of gross 

pay to the TSP. The FTC also matches 100 percent 

of the first three percent contributed and 50 percent 

of the next two percent contributed. Such the FTC 

contributions are recognized as current operating 

expenses. 

Although the FTC contributes a portion for pension 

benefits and makes the necessary payroll withholdings, 

it is not responsible for managing contribution refunds, 

employee’s retirement benefits, or the retirement 

plan assets. Therefore, the FTC financial statements 

do not report CSRS and FERS assets, accumulated 

plan benefits, or unfunded liabilities, if any, which 

may be applicable to employees. Such reporting is the 

responsibility of the Office of Personnel Management 

(OPM). However, the FTC recognizes the full cost of 

providing future pension benefits to covered employees 

at the time the employees’ services are rendered. OPM 

has provided the FTC with certain cost factors that 

estimate the true service cost of providing the pension 

benefits to covered employees. During FYs 2012 and 

2011, the cost factors used to arrive at the service cost 

for CSRS covered employees were 29.8 percent and 

30.1 percent of basic pay, respectively. During FYs 

2012 and 2011, the cost factors for FERS covered 

employees were 13.7 percent and 13.8 percent of basic 

pay, respectively. The pension expense recognized 

in the financial statements equals this service cost to 

covered employees less amounts contributed by these 

employees. If the pension expense exceeds the amount 

contributed by the FTC as employer, the excess is 

recognized as an imputed financing cost. The excess 

total pension expense over the amount contributed by 

the agency must be financed by OPM and is recognized 

as an imputed financing source on the records of the 

FTC. 

(n) OTHER pOST-EMpLOYMENT BENEFITS 

The FTC employees eligible to participate in the 

FEHBP and the FEGLIP may continue to participate 

in these programs after their retirement. The OPM has 

provided the FTC with certain cost factors that estimate 

the true cost of providing the post-retirement benefit 

to current employees. The FTC recognizes a current 

cost for these and Other Retirement Benefits (ORB) 

at the time the employee’s services are rendered. The 

ORB expense is financed by OPM, and offset by the 

FTC through the recognition of an imputed financing 

source. During FYs ended 2012 and 2011, the cost 

factors relating to FEHBP were $5,817 and $6,027, 

respectively, per employee enrolled. During FYs 2012 

and 2011, the cost factor relating to FEGLIP was 0.02 

percent of basic pay per employee enrolled. 

(o) NET pOSITION 

Cumulative results of operations represent the net 

results of operations since inception, the cumulative 

amount of prior period adjustments, the remaining 

book value of capitalized assets, and future funding 

requirements. 

The portion of the FTC’s budget authority that is 

funded by a direct appropriation is fully expended 

during the year. Therefore, there is no unexpended 

appropriation balance in net position at the end of the 

year. (See Statement of Changes in Net Position.) 

(p) REvENUES AND OTHER FINANCING 

SOURCES 

The FTC’s funding is derived from spending authority 

from offsetting collections revenue and from direct 

appropriation. Spending authority from offsetting 

collections is comprised of collections of premerger 

filing fees under the authority of the HSR Act, 

collection of fees related to the Do-Not-Call (DNC) 

Implementation Act, and amounts received for services 

performed under reimbursable agreements with other 

federal agencies. All of the FTC’s offsetting collections 

are exchange revenues. (See Note 13 Exchange 

Revenues.) 
121financial section

fiscal year 2012

In addition to exchange revenue, the FTC receives 

funding through a direct appropriation from the 

general fund of the Treasury to support its operations. 

The direct appropriation represented approximately 

62 percent of total budgetary resources in FY 2012 

and 59 percent in FY 2011. 

(q) METHODOLOGY FOR ASSIGNING 

COSTS AND ExCHANGE REvENUES 

Total net costs are allocated to the Protect Consumers 

strategic goal and the Maintain Competition strategic 

goal. (See Statement of Net Cost.) Costs and exchange 

revenues that are identified specifically with each of 

these two strategic goals are charged or credited directly. 

Other costs not directly attributable to these two goals 

are allocated based on the percentage of direct fulltime 

equivalents used by each of these two goals. These 

other indirect costs include costs related to the Advance 

Performance strategic goal.

(r) UNOBLIGATED BALANCE 

The amount reported on the Statement of Budgetary 

Resources as Unobligated balance, end of period, 

Apportioned for FY 2012 includes $45.1 million that 

was designated to fund costs associated with replacing 

leases for office space located at 601 New Jersey 

Avenue and 1800 M Street and for relocating affected 

staff into a new single facility. The FTC experienced 

certain delays that were outside of its direct control, 

but recently secured a new lease working in partnership 

with the General Services Administration and the 

Office of Management and Budget. Current plans call 

for these funds to be obligated in FY 2013 with the 

anticipated occupancy of the FTC’s new leased space in 

FY 2014. 
financial section

122 Federal Trade Commission | Performance and Accountability Report 

Note 3—Fund Balance with Treasury 

Fund balance includes appropriated funds, which are also includes non-entity funds arising from undisbursed 

either unobligated, or obligated as an account payable or HSR filing fees due to the DOJ and collections of 

undelivered order and not yet disbursed. Fund balance redress judgments not yet disbursed to claimants.

Non-entity assets consisted of the following as of September 30, 2012 and 2011 (in thousands):

2012 2011

Intragovernmental:

 fund balance with treasury $ 56,575

 Investments - 

 $ 4,093 

 35,443 

total intragovernmental:

 cash and other monetary assets

 accounts receivable, net

 56,575 

 28,360 

 30,944 

 39,536 

 44,944 

 11,321 

Total non-entity assets 115,879 95,801 

Total entity assets 155,638 127,582 

Total assets $ 271,517 $ 223,383 

Fund Balance with Treasury consisted of the following as of September 30, 2012 and 2011 (in thousands):

2012 2011

Fund balance with Treasury:

 appropriated funds $ 136,256 $ 108,132 

 desposit funds - redress 56,575 3,803 

 suspense fund - hsr filing fees (45) 290 

Total fund balance with Treasury $ 192,786 $ 112,225 

Status of fund balance with Treasury:

 unobligated balance

 apportioned $ 56,434 $ 17,882 

 unavailable 1,344 2,693 

 obligated balance not yet disbursed 78,478 87,557 

 non-Budgetary fund balance with treasury

 deposit funds - redress 56,575 3,803 

 suspense fund - hsr filing fees (45) 290 

Total status fund balance with Treasury $ 192,786 $ 112,225 

Note 2—Non-entity Assets

Non-entity Fund Balance with Treasury is comprised of redress. Cash and other Monetary Assets consist of 

undisbursed premerger filing fees and deposits held for amounts on deposit with FTC distribution agents. 

the consumer redress program. Investments represent Accounts receivable represent amounts due from 

funds not required for current distribution for consumer consumer redress judgments and civil penalties.
123financial section

fiscal year 2012

Note 4—Cash 

and Other 

Monetary Assets

In connection with the consumer 

redress program, cash amounts 

necessary to cover current disbursement 

schedules are held at financial 

institutions in interest bearing 

accounts pursuant to court orders 

and are reported as non-entity 

assets. A corresponding liability is 

recorded for these assets. The FTC’s 

consumer redress agents process 

claims and disburse redress proceeds 

to claimants upon approval of the 

redress office. (See Note 18 Redress 

and Divestiture Activities.) 

Note 5—Investments

After performing an analysis of the yield versus the related costs, the FTC discontinued this practice in 

August 2012 and all funds that were invested in Treasury securities were returned to FTC’s deposit fund as 

FBWT. Previously, funds not needed to cover immediate disbursements for consumer redress were invested 

Government Account Series (GAS) securities under an agreement with the Bureau of Public Debt. GAS secu

are non-marketable, market-based Treasury securities that are not traded on any securities exchange but mirror

the prices of particular Treasury securities trading in the government securities market. Additionally, in FY 20

the investments balance at the beginning of the year included long-time reserved funds that had been from on

judgment related to the FTC’s maintaining competition mission. The invested funds from this judgment were 

returned to the defendants during FY 2011. (See Note 18 Redress and Divestiture Activities.)

in 

rities 

11 

e 

Cash and other monetary assets consisted of the following as 

of September 30, 2012 and 2011 (in thousands):

2012 2011

cash and other monetary assets:

 redress contractors $ 28,360 $ 44,944 

Total cash and other monetary assets $ 28,360 $ 44,944 

As of September 30, 2012, investments consisted of the following (in thousands):

 

 

Amortized Amortization Interest Cost (Premium) Method Receivable Discount

Investment

Net

Other 

Adjustments

Market

Value

Disclosure

 Intragovernmental 

 securities: 

 non-marketable: 

 market-Based $ - n/a - - $ - - $ - 

 Total investments $ - n/a - - $ - - $ - 

As of September 30, 2011, investments consisted of the following (in thousands):

Amortized Market Amortization Interest Investment Other Cost (Premium) Value Method Receivable Net Adjustments Discount Disclosure

 Intragovernmental 

 securities: 

 non-marketable: 

 market-Based $ 35,443 n/a - - $ 35,443 - $ 35,443 

 Total investments $ 35,443 n/a - - $ 35,443 - $ 35,443 
financial section

124 Federal Trade Commission | Performance and Accountability Report 

Note 6—Accounts Receivable, Net

Accounts receivable, net balances reflect the FASAB 

standard for the recognition of losses using the 

collection criterion of “more likely than not.” 

This criterion results in receivable balances that are 

more conservatively stated than those valued by 

the private sector under GAAP. FASAB states that 

it is appropriate to recognize the nature of federal 

receivables, which, unlike trade accounts of private 

firms or loans made by banks, are not created through 

credit screening procedures. Rather, these receivables 

arise because of the assessment of fines from 

regulatory violations. In these circumstances, historical 

experience and economic realities indicate that these 

types of claims are frequently not fully collectible.

The method used to estimate the allowance for 

uncollectible receivables consists of individual case 

analysis by the attorney case manager with respect to the 

debtor’s ability and willingness to pay, the defendant’s 

payment record, and the probable recovery amount 

including the value of the sale of assets. Based on the 

aforementioned, cases are referred to the Treasury 

Offset Program for collection activities after the 

receivable becomes six months delinquent in payment.

Accounts receivable, net consisted of the following as of September 30, 2012 and 2011 (in thousands):

 Allowance for Gross Uncollectible 2012 Net Receivables Accounts 

 2011 Net 

 entity accounts receivable: 

 Intragovernmental $ 995 $ - $ 995 $ 26 

 With the public 47 - 47 53 

 

 total entity acounts receivable, net $ 1,042 $ - $ 1,042 $ 79 

 non-entity accounts receivable: 

 consumer redress $ 983,278 $956,059 $ 27,219 $11,229 

 civil penalties 33,719 29,994 3,725 92 

total non-entity accounts receivable, net $1,016,997 $986,053 $ 30,944 $11,321 

 Total accounts receivable, net $1,018,039 $986,053 $ 31,986 $11,400 
125financial section

fiscal year 2012

Note 7—General Property and 

Equipment, Net

FTC capitalizes property and equipment with an 

initial cost of $100 thousand or greater and a useful 

life over two years. Such assets are depreciated using 

the straight-line method of depreciation with service 

lives ranging from five to twenty years. Leasehold 

improvements that cost $100 thousand or greater are 

capitalized and amortized over the remaining life of the 

lease. Additionally, internal use software development 

and acquisition costs of $100 thousand or greater are 

capitalized as software development-in-progress until the 

development stage has been completed and the software 

successfully tested. Upon completion and testing, 

software development-in-progress costs are reclassified 

as internal use software costs and amortized using the 

straight-line method over the estimated useful life of 

three to five years. Purchased commercial software that 

does not meet the capitalization criteria is expensed.

Amounts reported as equipment are comprised 

mostly of computer hardware and other building 

equipment. The FTC does not own buildings, 

but rather, in partnership with General Services 

Administration (GSA) leases both federally owned 

(by GSA) and commercial space. (See Note 10 Leases.) 

The leasehold improvements below consist 

of improvements made to the FTC headquarters 

building (owned by the GSA), located in Washington, 

DC, and to the FTC commercially leased space also 

located in Washington, DC. 

Depreciation expense was $3,766 and $3,783 thousand 

for fiscal years ending September 30, 2012 and 2011, 

respectively, and is contained in the accumulated 

depreciation.

As of September 30, 2011, general property and equipment, net consisted of the following (in thousands):

Service Acquisition Accumulated Asset Class Life Value Depreciation

equipment 5-20 yrs. $ 10,357 $ 7,003 

leasehold improvements lease term 14,403 4,787 

software 3-5 yrs. 16,187 9,786 

Net 

Book Value

 $ 3,354 

 9,616 

 6,401 

Total general property and equipment, net $ 40,947 $ 21,576 $ 19,371 

As of September 30, 2012, general property and equipment, net consisted of the following (in thousands):

Service Acquisition Accumulated Asset Class Life Value Depreciation

equipment 5-20 yrs. $ 13,447 $ 7,363 

leasehold improvements lease term 14,351 5,742 

software 3-5 yrs. 15,275 11,583 

Net 

Book Value

 $ 6,084 

 8,609 

 3,692 

Total general property and equipment, net $ 43,073 $ 24,688 $ 18,385 
financial section

126 Federal Trade Commission | Performance and Accountability Report 

Note 8—Liabilities Not Covered by Budgetary Resources

Liabilities not covered by budgetary resources consisted of the following as of September 30, 2012 and 2011 (in thousands):

 

2012 2011

Intragovernmental:

 undisbursed premerger fees liability $ - $ 290 

 civil penalty collections due to treasury 3,725 92 

 feca liability 390 372 

 other unfunded employment related liability 7 15 

total intragovernmental liabilities not covered by budgetary resources $ 4,122 $ 769 

accrued redress receivables due to claimants 27,219 11,229 

redress collected not yet disbursed 84,935 84,190 

unfunded leave 11,529 11,013 

actuarial feca 2,080 2,208 

Total liabilities not covered by budgetary resources $ 129,885 $ 109,409 

Total liabilities covered by budgetary resources 12,878 20,778 

Total liabilities $ 142,763 $ 130,187 
127financial section

fiscal year 2012

Note 9—Other Liabilities

Other liabilities consisted of the following as of September 30, 2012 (in thousands):

 

2012

Non-Current

2012

Current 2012 Total

Intragovernmental:

 accrued benefits $ - $ 591 $ 591 

 civil penalty collection due to treasury - 3,725 3,725 

 feca liability 390 - 390 

total Intragovernmental 390 4,316 4,706 

accrued salary - 2,911 2,911 

accrued leave - 11,529 11,529 

actuarial feca 2,080 - 2,080 

Total Other Liabilities $ 2,470 $ 18,756 $ 21,226 

Other liabilities consisted of the following as of September 30, 2011 (in thousands):

 

2011

Non-Current

2011

Current 2011 Total

Intragovernmental:

 accrued benefits $ - $ 676 $ 676 

 undisbursed premerger liability - 290 290 

 civil penalty collection due to treasury - 92 92 

 feca liability 372 - 372 

total Intragovernmental 372 1,058 1,430 

accrued salary - 4,257 4,257 

accrued leave - 11,013 11,013 

actuarial feca 2,208 - 2,208 

Total Other Liabilities $ 2,580 $ 16,328 $ 18,908 
financial section

128 Federal Trade Commission | Performance and Accountability Report 

Note 10—Leases

Leases of commercial property are made through 

and managed by GSA. The FTC has leases on four 

government-owned properties and nine commercial 

properties. The FTC’s current leases expire at 

various dates through 2023. Certain leases provide 

for tenant improvement allowances and that these 

costs be amortized over the length of the leases. 

Under the terms of the leases, the FTC agrees to 

reimburse the landlord for the principal balance of 

the unamortized portion of the tenant improvement 

allowance in the event the agency vacates the space 

before lease expiration. The FTC rents approximately 

636,000 square feet of space in both commercial and 

government-owned properties for use as offices, storage

and parking. All FTC leases are operating leases. Rent 

expenditures for the years ended September 30, 2012 

and 2011, were approximately $24,374 and $22,006 

thousand, respectively.

Note 11—Commitments and 

Contingencies

The FTC is a party in various administrative proceedings, 

legal actions, and claims brought by or against it. 

In the opinion of the FTC management and legal 

counsel, the ultimate resolution of these proceedings, 

actions, and claims, will not materially affect the financial 

position or the results of operations of the FTC. 

Note 12—Intragovernmental Costs 

and Exchange Revenues

Intragovernmental costs represent costs incurred for 

goods or services provided by another federal entity. 

Public costs represent costs incurred for goods or 

services from a nonfederal entity. Intragovernmental 

earned revenue represents goods or services provided 

by the FTC to another federal entity. Public earned 

revenue represents goods or services provided by 

the FTC to a nonfederal entity. The purpose of this 

classification is to enable the federal government to 

provide consolidated financial statements.

Future minimum lease payments due under leases 

of government-owned property as of September 

30, 2012, are as follows (in thousands):

Fiscal Year

2013 $ 6,854 

2014 6,567 

2015 268 

2016 270 

2017 247 

Thereafter 420 

Total Future Minimum Lease Payments $ 14,626 

Future minimum lease payments under leases of commercial 

property due as of September 30, 2012, are as follows (in 

thousands):

Fiscal Year

2013 $ 16,251 

2014 16,486 

2015 14,458 

2016 14,481 

2017 12,112 

Thereafter 4,321 

Total Future Minimum Lease Payments $ 78,109 
129financial section

fiscal year 2012

Note 13—Exchange Revenues

Exchange revenues are earned through the collection of 

fees under the HSR Act. This Act, in part, requires the 

filing of premerger notifications with the FTC and the 

Antitrust Division of the DOJ and establishes a waiting 

period before certain acquisitions may be consummated. 

Mergers with transaction valuation above $68.2 million 

require the acquiring party to pay a filing fee. The filing 

fees are based on the transaction amount and follow 

a three-tiered structure: $45, $125 and $280 thousand. 

The FTC collects all HSR premerger fees, retains 

one-half, and remits 50 percent to the DOJ Antitrust 

Division pursuant to public law. Revenue is recognized 

upon collection of the appropriate fee and verification 

of proper documentation. 

Exchange revenues are also earned through the 

collection of fees for the National DNC Registry. 

This Registry operates under Section 5 of the FTC 

Act, which enforces the Telemarketing Sales Rule. 

Public Law (P.L.) No. 110-188, the Do- Not-Call 

Extension Act of 2007, amended the Do-Not-Call 

Implementation Act (P.L. No. 108-010) and established 

a permanent fee structure. Fees are reviewed annually 

and adjusted for inflation as appropriate in accordance 

with P.L. 110-188. Telemarketers are required to pay 

an annual subscription fee and download from the 

DNC Registry database a list of telephone numbers of 

consumers who do not wish to receive calls. Fees are 

based on the number of area codes downloaded. On 

October 1, 2011, the minimum charge was raised from 

$55 to $56 to download one area code. The maximum 

charge was raised from $15,058 to $15,503 for all area 

codes within the United States. Revenue is recognized 

when collected and the telemarketer is given access to 

the requested data. 

For the FYs ended September 30, 2012 and 2011, intragovernmental and public costs and exchange revenues are as 

follows (in thousands): 

2012 2011

Protect Consumers (PC) Strategic Goal:

 Intragovernmental gross costs $ 43,660 $ 43,116 

 public costs 121,107 126,218 

total pc strategic goal costs 164,767 169,334 

 Intragovernmental earned revenue (42) (513)

 public earned revenue (13,752) (13,720)

total pc strategic goal earned revenue (13,794) (14,233)

Total PC strategic goal net costs 150,973 155,101 

Maintain Competition (MC) Strategic Goal:

 Intragovernmental gross costs 32,139 32,926 

 public costs 89,148 96,389 

total mc strategic goal costs 121,287 129,315 

 Intragovernmental earned revenue (281) (560)

 public earned revenue (87,544) (91,424)

total mc strategic goal earned revenue (87,825) (91,984)

Total MC strategic goal net costs 33,462 37,331 

Net Cost of Operations $ 184,435 $ 192,432 
financial section

130 Federal Trade Commission | Performance and Accountability Report 

Note 14—Apportionment 

Categories of Obligations 

Incurred: Direct vs. Reimbursable 

Obligations

Note 15—Explanation of 

Differences between the 

Statement of Budgetary 

Resources and the Budget of the 

United States Government

There are no material differences between amounts 

reported in the FY 2011 Statement of Budgetary 

Resources and the FY 2011 actual amounts as 

reported in the FY 2013 Budget of the United States 

Government. The FY 2014 Budget of the United 

States is not available to compare FY 2012 actual 

amounts to the FY 2012 Statement of Budgetary 

Resources. 

Note 16—Undelivered Orders at 

the End of the Period

The amount of budgetary resources obligated for 

undelivered orders as of September 30, 2012 and 

2011, is $66,697 and $66,895 thousand respectively. 

For the FYs ended September 30, 2012 and 2011, obligations 

incurred consisted of the following (in thousands):

2012 2011

obligations incurred:

category a - direct obligations $ 279,646 $ 292,146 

category B - reimbursable obligations 369 913 

Total obligations incurred $ 280,015 $ 293,059 

For the FYs ended September 30, 2012 and 2011, exchange 

revenues consisted of the following (in thousands):

2012 2011

hsr premerger filing fees $ 87,544 $ 91,424 

do not call registry fees 13,752 13,720 

reimbursable agreements 323 1,073 

Total obligations incurred $ 101,619 $ 106,217 

Exchange revenue is also earned for services provided 

to other government agencies through reimbursable 

agreements. The FTC recovers the full cost of services, 

primarily salaries and related expenses. Revenue is 

earned at the time the expenditures are incurred against 

the reimbursable order. Exchange revenues are deducte

from the full cost of the FTC’s strategic goals to arrive 

d 

at net strategic goal cost.
131financial section

fiscal year 2012

Note 17—Custodial Activities 

The primary custodial activities of the FTC are:

pREMERGER FILING FEES

All HSR premerger filing fees are collected by the FTC 

pursuant to 15 U.S.C. 18a notes, as amended, and are 

divided evenly between the FTC and the DOJ. During 

FY 2012 and FY 2011, the FTC collected $175,088 and 

$182,848 thousand respectively, in HSR premerger filing 

fees. The amounts designated for the DOJ as reported 

on the Statement of Custodial Activity (SCA) were 

$87,544 thousand for FY 2012 and $91,424 thousand 

for FY 2011. Fees to be credited back from DOJ and 

the Department of Treasury at September 30, 2012 

were $45 thousand; undistributed fees due the DOJ 

at September 30, 2011 were $290 thousand. 

CIvIL pENALTIES AND FINES

Civil penalties collected in connection with the 

settlement or litigation of the FTC’s administrative 

or federal court cases are collected by either the FTC 

or the DOJ as provided for by law. The FTC deposits 

these collections into the Treasury. Civil penalties 

collected also include amounts collected for undecided 

civil penalty cases that are held until final disposition 

of the case. All civil penalties collected are disgorged to 

the general fund of the Treasury at the end of the year. 

REDRESS

Collections for redress reported on the SCA are limited to 

those collections that have been disgorged to the Treasury. 

Collections disgorged to the Treasury were $15,261 

thousand for FY 2012 and $13,177 thousand for FY 2011. 

Other line items on the SCA include: 

ACCRUAL ADjUSTMENTS

The accrual adjustments represent the difference 

between the opening and closing balances for civil 

penalty accounts receivable, net of allowance. 

(DECREASE)/INCREASE IN AMOUNTS YET 

TO BE TRANSFERRED

This represents the difference between the opening 

and closing balances for the offsetting liability is that 

is established for the civil penalty funds due to be 

collected (receivable). 

Note 18—Redress and Divestiture 

Activities

REDRESS 

The FTC obtains consumer redress in connection with 

the settlement or litigation of both its administrative 

proceedings and its federal court cases. The FTC 

attempts to distribute funds thus obtained to consumers 

whenever possible. If consumer redress is not practical, 

the funds are paid (disgorged) to the Treasury, or 

on occasion, other alternatives, such as consumer 

education, are permitted. Major components of the 

program include eligibility determination, disbursing 

redress to claimants, and accounting for the disposition 

of these funds. Collections made against court-ordered 

judgments totaled $53,442 and $41,596 thousand during 

FYs 2012 and 2011, respectively. 

DIvESTITURE FUND 

The divestiture fund consisted of one judgment 

(obtained by the FTC in support of its strategic goal 

to maintain competition) that required the defendants 

to place funds in reserve under the FTC control. The 

funds were available for development opportunities by 

a competing company that had received divested assets 

from the defendants. A subsequent court decision 

allowed the funds to be returned to the defendants 

in FY 2011.
financial section

132 Federal Trade Commission | Performance and Accountability Report 

2012 2011

Redress:

 Fund Balance with Treasury

 Beginning balance $ 3,803 $ 5,471 

 collections 53,442 41,596 

 disbursements to claimants, net 1 (48)

 disgorgements to treasury (15,261) (13,177)

 transfers, expenses, refunds 14,590 (30,039)

 Total fund balance with Treasury, ending $ 56,575 $ 3,803 

 Cash and Other Monetary Assets

 Beginning balance $ 44,944 $ 21,473 

 disbursements to claimants, net (36,231) (116,089)

 transfers, expenses, interest income 19,647 139,560 

 Total cash and other monetary assets, ending $ 28,360 $ 44,944 

 Investments

 Beginning balance $ 35,443 $ 153,582 

 transfers, expenses, interest income (14,269) (118,139)

 return to deposit fund (21,174) - 

 Total investments, ending $ - $ 35,443 

 Accounts receivable, net

 Beginning balance $ 11,229 $ 38,170 

 net activity 15,990 (26,941)

 Total accounts receivable, ending $ 27,219 $ 11,229 

Divestiture Fund:

 Investments

 Beginning balance $ - $ 45,523 

 Interest, net of (expenses) - (4)

 return of funds - (45,519)

 Total investments, ending $ - $ - 

Redress and divestiture fund activities consisted of the following for September 30, 2012 and 2011 (in thousands):
133financial section

fiscal year 2012

Note 19 — Reconciliation of Net Cost of Operations to Budget

For the FYs ended September 30, 2012 and 2011 (in thousands):

2012 2011

Resources Used to Finance Activities:

Budgetary resources obligated:

 obligations incurred $ 280,015 $ 293,059 

 less: spending authority from offsetting collections and recoveries (106,951) (114,287)

obligations net of offsetting collections and recoveries 173,064 178,772 

other resources:

Imputed financing from costs absorbed by others 9,726 11,759 

 net other resources used to finance activities 9,726 11,759 

Total resources used to finance activities 182,790 190,531 

Resources Used to Finance Items not Part of the Net Cost of Operations:

 change in budgetary resources obligated for goods,

 services and benefits ordered but not yet provided 256 2,936 

 resources that finance the acquisition of assets (5,283) (5,093)

Total resources used to finance items not part of the net cost of operations (5,027) (2,157)

Total resources used to finance the net cost of operations 177,763 188,374 

Components of the Net Cost of Operations that will not Require or

Generate Resources in the Current Period:

 components requiring or generating resources in future periods:

 Increase in annual leave liability 516 330 

 other (113) (55)

 total components of net cost of operations that will require or

 generate resources in future periods 403 275

 components not requiring or generating resources:

 depreciation and amortization 3,766 3,783 

 losses on disposition of assets - other 2,503 - 

 total components of net cost of operations that will not require or 

 generate resources 6,269 3,783 

Total components of net cost of operations that will not require or

 generate resources in the current period 6,672 4,058 

Net Cost of Operations $ 184,435 $ 192,432 
other accompanying information

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other accompany ng

nf

i ormat o
other accompanying information

136 Federal Trade Commission | Performance and Accountability Report 
137other accompanying information

fiscal year 2012

INSpECTOR GENERAL-IDENTIFIED MANAGEMENT AND pERFORMANCE 

CHALLENGES (CONTINUED)
other accompanying information

138 Federal Trade Commission | Performance and Accountability Report 

INSpECTOR GENERAL-IDENTIFIED MANAGEMENT AND pERFORMANCE 

CHALLENGES (CONTINUED)
139other accompanying information

fiscal year 2012

INSpECTOR GENERAL-IDENTIFIED MANAGEMENT AND pERFORMANCE 

CHALLENGES (CONTINUED)
other accompanying information

140 Federal Trade Commission | Performance and Accountability Report 

INSpECTOR GENERAL-IDENTIFIED MANAGEMENT AND pERFORMANCE 

CHALLENGES (CONTINUED)
141other accompanying information

fiscal year 2012

INSpECTOR GENERAL-IDENTIFIED MANAGEMENT AND pERFORMANCE 

CHALLENGES (CONTINUED)
other accompanying information

142 Federal Trade Commission | Performance and Accountability Report 

INSpECTOR GENERAL-IDENTIFIED MANAGEMENT AND pERFORMANCE 

CHALLENGES (CONTINUED)
143other accompanying information

fiscal year 2012

Chairman’s resPonse to ig Challenges
other accompanying information

144 Federal Trade Commission | Performance and Accountability Report 

Summary of Financial Statement Audit and Management Assurances

audit oPinion Unqualified

restatement No

material weaknesses

Beginning 

Balance new resolved Consolidated ending 

Balance

0 0 0 0 0

total material 

weaknesses 0 0 0 0 0

TABLE 1: SUMMARY OF FINANCIAL STATEMENT AUDIT

effectiveness of internal control Over financial reporting (federal Managers’ 

financial integrity act (fMfia) Para. 2)

statement of 

assuranCe Unqualified

material weaknesses

Beginning 

Balance new resolved Consolidated ending 

Balance

0 0 0 0 0

total material 

weaknesses 0 0 0 0 0

effectiveness of internal control Over Operations (fMfia Para. 2)

statement of 

assuranCe Unqualified

material weaknesses

Beginning 

Balance new resolved Consolidated ending 

Balance

0 0 0 0 0

total material 

weaknesses 0 0 0 0 0

conformance with financial Management System requirements (fMfia Para. 4)

statement of 

assuranCe Systems conform to financial management system requirements

non-ConformanCes

Beginning 

Balance new resolved Consolidated ending 

Balance

0 0 0 0 0

total nonConformanCes 0 0 0 0 0

TABLE 2: SUMMARY OF MANAGEMENT ASSURANCES
145other accompanying information

fiscal year 2012

IMPROPER PAYMENTS ELIMINATION 

AND RECOVERY ACT 

The Improper Payments Elimination and Recovery 

Act (IPERA) (Public Law No. 111-204) defines 

requirements to reduce improper and erroneous 

payments made by the federal government. In addition, 

the Office of Management and Budget (OMB) issued 

guidance (Memorandum M-11-16) which defines 

“significant improper payments” and prescribes the 

reporting requirements for agencies with programs 

that are susceptible to significant improper payments. 

Memorandum M-11-16 also provide guidance to 

agencies for implementing payment recapture audits, 

for programs and activities that expend $1 million 

or more annually, provided it is cost-effective to do 

so. The FTC reviewed its programs and activities 

in accordance with the prescribed guidance and 

determined that none of the agency’s programs 

or activities is susceptible to making significant 

improper payments as defined by OMB and that the 

implementation of payment recapture audit would not 

be cost-effective for the agency.

In FY 2012, OMB issued Memorandum M-12-11 

to further reduce improper payments by using the 

Department of Treasury’s Do Not Pay List. The Do 

Not Pay List combines multiple databases (e.g. Death 

Master File and Excluded Parties List System) against 

which agencies are able to validate vendor payments. 

The FTC’s shared service provider, the Department 

of Interior’s National Business Center, is enrolled in 

the Do Not Pay List and continuously monitors the 

database to identify and prevent improper payments 

before they are made. NBC matches the FTC’s vendor 

and employee records, which are maintained in the 

Oracle Federal Financials system, to the Do Not Pay 

List, on a weekly basis.

Additionally, the FTC has incorporated in its pre-award 

process a procedure to match potential contractors 

against the Do Not Pay List.
endic app es

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append

ice
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148 Federal Trade Commission | Performance and Accountability Report 

STRATEGIC GOAL 1: PROTECT 

CONSUMERS

OBjECTIVE 1.1: IDENTIFY FRAUD, 

DECEPTION, AND UNFAIR PRACTICES 

THAT CAUSE THE GREATEST 

CONSUMER INjURY.

Performance Measure 1.1.1: Complaints collected an

entered into the Consumer Sentinel Network Database.

Definition and background: This measure tracks 

complaints entered into the FTC’s Consumer Sentinel 

Network (CSN) Database. Consumer Sentinel is an 

investigative tool that provides access to millions of 

consumer complaints to member law enforcement 

agencies. More information about CSN can be found 

at www.ftc.gov/sentinel/index.shtm. 

Data sources: The FTC’s CSN database.

Verification and validation: Reports are run at least 

quarterly to determine the number of complaints that 

are entered into the CSN database.

Data limitations: The data in the CSN database is 

dependent on the complainant providing accurate and 

complete information. CSN data may be underreporte

because some people choose not to file a formal 

complaint, and some people may not know they are 

able to file a complaint with the FTC.

Performance Measure 1.1.2: The percentage of the 

FTC’s consumer protection law enforcement actions 

that target the subject of consumer complaints to the 

FTC. 

Definition and background: This measure gauges 

how well the FTC’s consumer protection law 

enforcement actions target the subject of concerns 

identified by consumers.

Data sources: The FTC’s CSN database, LexisNexis 

CourtLink, the FTC website, and reports from the 

agency, Bureau Director’s Office, divisions, and regiona

offices. 

Verification and validation: A list of all federal court 

actions filed in the current fiscal year is compiled in a 

spreadsheet. For each case, CSN database searches by 

the defendants’ names are completed to determine if 

d 

d 

l 

the cases target subjects of consumer complaints to 

the FTC. The results of the searches are also recorded 

on the spreadsheet, and the percentage is calculated 

based on this information. This information is reviewed 

periodically by staff and management for completeness 

and accuracy. 

Data limitations: The spreadsheet may not capture a 

case if it is missed during the internal review process.

Performance Measure 1.1.3: The rate of customer 

satisfaction with the FTC’s Consumer Response Center.

Definition and background: This measure ensures 

the FTC is providing satisfactory service to consumers 

through the complaint website and call center.

Data sources: Reports from the U.S. Department of 

the Interior’s Federal Consulting Group, the executive 

agent for the American Customer Satisfaction Index 

(ACSI).

Verification and validation: Measurement is generated 

by an outside source based on industry standard 

practices.

Data limitations: There are no significant data 

limitations.

OBjECTIVE 1.2: STOP FRAUD, 

DECEPTION, UNFAIRNESS, AND OTHER 

UNLAWFUL PRACTICES THROUGH LAW 

ENFORCEMENT.

Performance Measure 1.2.1: The percentage of all 

cases filed by the FTC that were successfully resolved 

through litigation, a settlement, or issuance of a default 

judgment.

Definition and background: This measure gauges 

how well the FTC successfully resolves cases, including 

those that raise challenging legal and factual issues.

Data sources: LexisNexis CourtLink, the FTC 

website, and reports from the Bureau Director’s Office, 

divisions, and regional offices.

Verification and validation: A list of all federal court 

cases resolved in the current fiscal year is compiled in a 

spreadsheet, and the percentage of successfully resolved 

cases is calculated based on this information. The 

report is sent to the Associate Directors and regional 

APPENDIX A: DATA qUALITY 

INFORMATION
149appendices

fiscal year 2012

managers on a quarterly basis to verify the accuracy of 

the report and ensure all resolutions are included in the 

report.

Data limitations: The spreadsheet may not capture a 

case if it is missed during the internal review process. 

Performance Measure 1.2.2: The FTC’s effectiveness 

in stopping prohibited business practices in three high 

priority areas over the next five years. 

Definition and background: This measure gauges the 

FTC’s success in changing business practices related to 

misleading advertising claims within priority areas and 

demonstrates the change through research methods.

Data sources: Evaluations of the prevalence of 

prohibited business practices in targeted areas. The 

Internet is used to examine advertising claims.

Verification and validation: Attorneys assigned to the 

subject area work with FTC economists to validate the 

methodology and quality control.

Data limitations: Advertising claims in other types of 

media are not captured.

Performance Measure 1.2.3: The percentage of 

redress cases in which the FTC distributes redress 

dollars designated for distribution to consumers within 

six months. 

Definition and background: This measure ensures 

that the FTC returns redress dollars to consumers as 

quickly as possible.

Data sources: Bureaus’ open redress case status 

reports.

Verification and validation: When a redress 

distribution occurs, the date of the distribution is 

checked and verified to determine whether or not the 

redress occurred within six months. 

Data limitations: There are no significant data 

limitations. 

Performance Measure 1.2.4: Investigations or cases 

in which the FTC obtains foreign-based evidence or 

engages in mutual assistance that contributes to FTC 

law enforcement actions or in which we cooperate with 

foreign agencies and/or multilateral organizations.

Definition and background: This measure tracks 

investigations or cases in which the FTC obtains 

foreign-based evidence or engages in mutual assistance 

that contributes to FTC law enforcement actions or 

in which we cooperate with foreign agencies and/or 

multilateral organizations.

Data sources: Office of International Affairs (OIA) 

weekly reports and internal tracking sheets.

Verification and validation: Consumer Protection 

team members report matters they worked on in which 

information was shared. Staff review and compile the 

matters reported. Managers review these matters to 

ensure that they qualify as part of the measure and have 

not been previously counted.

Data limitations: Review is necessary to avoid double 

counting of particular matters.

OBjECTIVE 1.3: PREVENT CONSUMER 

INjURY THROUGH EDUCATION.

Performance Measure 1.3.1: Consumer protection 

messages accessed online or in print. 

Definition and background: This measure gauges 

whether the agency is producing a sufficient amount 

of educational activity and educational materials that 

are aimed at new trends and at particularly vulnerable 

populations.

Data sources: The measure is determined using 

the agency’s web statistics software (for messages 

accessed online) and the FTC publication inventory 

(for messages accessed in print). Print distribution 

numbers are derived from three sources: distribution 

center; distribution from the FTC warehouse; and 

distribution directly from printers when publications 

are printed or reprinted. A full recap for FY12 is 

available upon request.

Verification and validation: The publication inventory 

is tracked to determine the number of print messages 

distributed. The agency’s IT office compiles statistics 

for all FTC websites.

Data limitations: It is possible that distribution is 

much higher than reported, as online users may be 

printing and disseminating copies. 

Performance Measure 1.3.2: Customer satisfaction 

rate with the FTC consumer education websites or 

microsites. 

Definition and background: This measure gauges the 

effectiveness, helpfulness, and usability of the FTC’s 

consumer education websites and microsites.

Data sources: Reports from the U.S. Department of 

the Interior’s Federal Consulting Group, the executive 

agent for the American Customer Satisfaction Index 

(ACSI).

Verification and validation: Measurement is generated 
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150 Federal Trade Commission | Performance and Accountability Report 

by an outside source based on industry standard 

practices.

Data limitations: There are no significant data 

limitations. 

Performance Measure 1.3.3: Organizations requesting 

consumer education publications.

Definition and background: This measure helps the 

FTC ensure that it is publicizing its activities in the best 

way possible, and that the agency has a wide array of 

partners to leverage resources.

Data sources: The measure is derived from the 

agency’s database of online customer orders, maintained 

by the Division of Consumer and Business Education.

Verification and validation: The data includes 

customers who have ordered materials during the fiscal 

year and provided a valid organization. Orders from 

individuals and duplicate organizations are not included.

Data limitations: The accuracy of the calculations 

depends in part on customers entering their 

organization name into the order form with consistent 

spelling and formatting; otherwise data may be slightly 

over-reported.

OBjECTIVE 1.4: ENHANCE CONSUMER 

PROTECTION THROUGH RESEARCH, 

REPORTS, RULEMAKING, AND 

ADVOCACY.

Performance Measure 1.4.1: Workshops and 

conferences convened or cosponsored that address 

consumer protection problems.

Definition and background: This measure helps the 

FTC ensure that enforcement and education efforts 

are augmented by encouraging discussions among 

all interested parties, through careful study of and 

empirical research on novel or challenging consumer 

protection problems.

Data sources: The FTC website and reports from the 

agency, Bureau Director’s Office, division, and regional 

offices.

Verification and validation: A list of all workshops 

and conferences is maintained in a spreadsheet. The 

spreadsheet is reviewed quarterly by headquarters and 

regional office management to verify the accuracy 

of the report and to ensure that all conferences and 

workshops are included in the report.

Data limitations: Review is necessary to avoid underreporting any workshops or conferences.

Performance Measure 1.4.2: Advocacy comments and 

amicus briefs on consumer protection issues filed with 

entities including federal and state legislatures, agencies, 

or courts.

Definition and background: The measure tracks 

the number of advocacy comments and amicus briefs 

on consumer protection matters filed with entities 

including federal and state legislatures, agencies, and 

courts to measure the output of the FTC’s advocacy 

activities relating to consumer protection matters.

Data sources: Internal matter records of advocacy 

comments and amicus briefs filed (e.g., records available 

in the FTC’s document management system).

Verification and validation: Review of internal matter 

records of advocacy comments and amicus briefs 

filed (e.g., records available in the FTC’s document 

management system) and confirmation of data with 

staff having responsibilities for advocacy matters.

Data limitations: There are no significant data 

limitations.

Performance Measure 1.4.3: The percentage of 

respondents finding the FTC’s advocacy comments and 

amicus briefs “useful.”

Definition and background: This measure tracks the 

percentage of respondents finding the FTC’s advocacy 

comments and amicus briefs to be “useful,” in order 

to assess the effect of consumer protection advocacy 

comments.

Data sources: Responses to a written survey, sent by 

agency staff to advocacy recipients (except courts), to 

evaluate the usefulness of an advocacy.

Verification and validation: Agency staff review 

written responses in order to determine percentage of 

respondents describing the FTC’s advocacy comments 

as “useful.”

Data limitations: There are no significant data 

limitations.

Performance Measure 1.4.4: The percentage of 

proposed Administrative Procedure Act (APA) 

rulemakings, conducted solely by the FTC, completed 

within nine months of receipt of final comments in the 

Final Notice of Proposed Rulemaking.

Definition and background: This measure helps the 

FTC ensure that the agency augments its enforcement 

and education efforts by conducting appropriate 

rulemakings.

Data sources: The Federal Register and the FTC 

website.

Verification and validation: A list of all rulemakings, 
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fiscal year 2012

the comment period close date, and the completion date 

of APA rulemakings is maintained in a spreadsheet. 

The spreadsheet is reviewed quarterly by headquarters 

and regional office management to verify the accuracy 

of the report and to ensure that all rulemakings are 

included in the report. 

Data limitations: Review is necessary to avoid underreporting any rulemakings.

OBjECTIVE 1.5: PROTECT AMERICAN 

CONSUMERS IN THE GLOBAL 

MARKETPLACE BY PROVIDING SOUND 

POLICY AND TECHNICAL INPUT 

TO FOREIGN GOVERNMENTS AND 

INTERNATIONAL ORGANIzATIONS TO 

PROMOTE SOUND CONSUMER POLICY.

Performance Measure 1.5.1: Policy advice provided 

to foreign consumer protection and privacy agencies, 

directly and through international organizations, 

through substantive consultations, written submissions, 

or comments. 

Definition and background: This measure tracks 

policy advice provided to foreign consumer protection 

and privacy agencies, directly and through international 

organizations. Policy advice is defined as substantive 

consultations, written submissions, or comments.

Data sources: Office of International Affairs (OIA) 

weekly reports and internal tracking sheets.

Verification and validation: OIA staff report 

policy advice provided in weekly reports and internal 

logs. Staff review and compile the matters reported. 

Managers review these matters to ensure that they are 

sufficiently substantive to qualify for the measure and 

have not previously been counted. 

Data limitations: Review is necessary to avoid double 

counting of particular matters and to ensure the 

instances of policy advice reported are sufficiently 

substantive.

Performance Measure 1.5.2: Technical assistance to 

foreign consumer protection and privacy authorities.

Definition and background: This measure tracks 

technical assistance provided to foreign consumer 

protection and privacy authorities.

Data sources: Office of International Affairs weekly 

reports and Technical Assistance calendar.

Verification and validation: OIA staff report technical 

assistance workshops, conferences, and other missions 

conducted. Staff review and compile the matters 

reported, and managers review these reports.

Data limitations: Review is necessary to ensure that 

reported items qualify as technical assistance missions.

STRATEGIC GOAL 2: MAINTAIN 

COMPETITION

OBjECTIVE 2.1: TAKE ACTION AGAINST 

ANTICOMPETITIVE MERGERS 

AND PRACTICES THAT MAY CAUSE 

SIGNIFICANT CONSUMER INjURY.

Performance Measure 2.1.1: Actions to maintain 

competition, including litigated victories, consent 

orders, abandoned transaction remedies, restructured 

transaction remedies, or fix-it-first transaction remedies 

in a significant percentage of substantial merger and 

nonmerger investigations.

Definition and background: This measure ensures 

that FTC actions promote vigorous competition by 

preventing anticompetitive mergers and stopping 

business practices that diminish competition. This 

measure reflects actions to maintain competition, 

including litigated victories, consent orders, abandoned 

transaction remedies, restructured transaction remedies, 

or fix-it-first transaction remedies in a significant 

percentage of substantial merger and nonmerger 

investigations. The measure is calculated by taking 

the number of substantial investigations closed with 

an action divided by the total number of substantial 

investigations closed.

Data sources: Press releases are the source of 

information for public actions, such as consent orders 

and the results of judicial review, while internal 

communications from staff attorneys are used to 

identify those investigations that were closed because 

parties abandoned a transaction or because staff did not 

find that the transaction is likely to harm competition. 

This information is then used to populate the bureau’s 

enforcement database and is cross referenced with 

both the list of known second request and compulsory 

process merger investigations as recorded in an 

agency database of matters and the list of nonmerger 

investigations with more than 150 hours, as identified 

using the agency’s time and attendance reporting 

database.

Verification and validation: The data is entered into 

a bureau database by staff, and reviewed monthly by 
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152 Federal Trade Commission | Performance and Accountability Report 

analysts, attorneys, economists, and senior management.

Data limitations: This measure does not include 

actions taken in investigations that did not involve the 

use of compulsory process, and therefore did not fall 

under the definition of substantial as specified by this 

measure. Compulsory process refers to a resolution, or 

vote, adopted by the Commission that authorizes staff 

to issue subpoenas and civil investigative demands. This

measure also does not include actions that are still in 

litigation or on appeal.

Performance Measure 2.1.2: Consumer savings of at 

least $500 million through merger actions to maintain 

competition.

Definition and background: This measure ensures 

that the Commission’s merger actions are in part guided

by the prospective effect these actions will have on 

consumer savings. The measure is calculated by taking 

the sum of “Consumer Savings” of individual merger 

actions for the current fiscal year plus the previous four

fiscal years and dividing the sum by five. 

Data sources: The lead attorney estimates consumer 

savings for a particular case using the appropriate 

applicable estimation formula and submits it to the 

Bureau of Economics for concurrence. If available, 

staff will use case-specific data to generate the estimate 

of consumer savings. Otherwise, staff uses a formulaic 

approach taking one percent of the volume of 

commerce for two years.

Verification and validation: See measure 2.1.1.

Data limitations: The data is dependent on the 

estimates of consumer savings made by staff in 

accordance with the appropriate applicable estimation 

formulas. Additionally, a - five year average is used 

because an individual year may be heavily influenced by 

significant cases in that year.

Performance Measure 2.1.3: Actions against mergers 

likely to harm competition in markets with a total of at 

least $25 billion in sales.

Definition and background: This measure ensures 

that the Commission’s merger actions are guided in part

by the size of the relevant product markets involved. 

The measure is calculated by taking the sum of the 

estimated volume of commerce for the current fiscal 

year plus the previous four fiscal years divided by five.

Data sources: The lead attorney who worked on the 

investigation estimates the volume of commerce using 

the appropriate applicable estimation formula and 

submits the information to the Bureau of Economics 

for concurrence.

Verification and validation: See measure 2.1.1.

Data limitations: The data is dependent on the 

estimates of volume of commerce made by staff in 

accordance with the appropriate applicable estimation 

formulas. Additionally, a five year average is used 

because an individual year may be heavily influenced by 

significant cases in that year.

Performance Measure 2.1.4: Consumer savings of 

at least thirteen times the amount of FTC resources 

allocated to the merger program.

Definition and background: This measure ensures 

that the Commission’s actions are in part guided by the 

requirement that estimated consumer savings exceed 

how much is spent on the merger program. Estimated 

consumer savings generated under measure 2.1.2 

are divided by the amount of resources spent on the 

merger program for the current fiscal year.

Data sources: The lead attorney estimates consumer 

savings for a particular case using the appropriate 

applicable estimation formula and submits it to the 

Bureau of Economics for concurrence. The FTC’s 

financial system provides the amount of resources 

expended on the merger program. 

Verification and validation: See measure 2.1.1.

Data limitations: See measure 2.1.2.

Performance Measure 2.1.5: Consumer savings of at 

least $80 million through nonmerger actions taken to 

maintain competition.

Definition and background: This measure ensures 

that the Commission’s nonmerger actions are in 

part guided by the prospective effect they will have 

on consumer savings. The measure is calculated by 

taking the sum of the estimated consumer savings in 

nonmerger actions for the current fiscal year plus the 

previous four fiscal years, and dividing the sum by five.

Data sources: The lead attorney estimates consumer 

savings for a particular case using the appropriate 

applicable estimation formula and submits it to the 

Bureau of Economics for concurrence. If available, 

staff will use case-specific data to generate the estimate 

of consumer savings. Otherwise, staff uses a formulaic 

approach taking one percent of the volume of 

commerce for one year. 

Verification and validation: See measure 2.1.1.

Data limitations: See measure 2.1.2.

Performance Measure 2.1.6: Actions against 
153appendices

fiscal year 2012

anticompetitive conduct in markets with a total of at 

least $8 billion in annual sales.

Definition and background: This measure ensures 

that the Commission’s nonmerger actions are in part 

guided by the size of the relevant product markets 

involved. The measure is calculated by taking the sum 

of the estimated volume of commerce for the current 

fiscal year plus the previous four fiscal years and 

dividing the sum by five.

Data sources: The lead attorney who worked on the 

investigation estimates the volume of commerce using 

the appropriate applicable estimation formula and 

submits the information to the Bureau of Economics 

for concurrence.

Verification and validation: See measure 2.1.1.

Data limitations: See measure 2.1.3.

Performance Measure 2.1.7: Consumer savings of 

at least twenty times the amount of FTC resources 

allocated to the nonmerger program.

Definition and background: This measure ensures 

that the Commission’s actions are in part guided by the 

requirement that estimated consumer savings exceed 

how much is spent on the nonmerger program. This 

measure is calculated by taking the estimated consumer 

savings generated under measure 2.1.5 divided by the 

amount of resources spent on the nonmerger program. 

Data sources: The lead attorney estimates consumer 

savings for a particular case using the appropriate 

applicable estimation formula.) The FTC’s financial 

system provides the amount of resources expended on 

the nonmerger program.

Verification and validation: See measure 2.1.1. 

Data limitations: See measure 2.1.2.

Performance Measure 2.1.8: The percentage of 

cases in which the FTC had at least one substantive 

contact with a foreign antitrust authority in which the 

agencies followed the analytical approach and reached 

compatible outcomes.

Definition and background: This measure tracks the 

cases in which the Bureau of Competition or foreign 

agency staff notify OIA that a substantial contact 

has taken place, compared with cases where, in the 

judgment of OIA management, no consistent analytical 

approaches were observed. The phrase “reached 

compatible outcomes” means that the reviewing 

agencies do not impose inconsistent obligations on 

parties; professional judgment from OIA senior 

management is used to make a final decision on 

compatibility for FTC measurement purposes. 

Data sources: Office of International Affairs (OIA) 

weekly reports and internal logs.

Verification and validation: International Antitrust 

team members report matters they worked on in which

substantial contact took place. Staff review and compil

the matters reported, overseen by an International 

Antitrust team member. Managers review and ensure 

that the matters reported qualify for the measure.

Data limitations: Review is necessary to ensure that 

the matters reported included sufficiently substantial 

contact with a foreign antitrust authority.

OBjECTIVE 2.2: PREVENT CONSUMER 

INjURY THROUGH EDUCATION.

Performance Measure 2.2.1: Competition resources 

accessed via the FTC’s website.

Definition and background: This measure ensures 

that consumer injury is prevented by educating antitrus

practitioners and consumers. This measure is calculate

by taking the sum of the views recorded on antitrust 

related web pages on the Commission’s external 

website.

Data sources: The primary data source is software tha

monitors traffic on the FTC’s external website.

Verification and validation: Bureau staff identify 

relevant FTC web-based resources to track. Internet 

traffic data is received and entered into a bureau 

database by staff, and reviewed monthly by analysts, 

attorneys, and senior management.

Data limitations: The analysis is dependent on the 

accuracy of measurements made by the web tracking 

software and the presence of internal and external 

traffic filters. The data is also dependent on the accurat

identification of relevant FTC web-based materials.

OBjECTIVE 2.3: ENHANCE CONSUMER 

BENEFIT THROUGH RESEARCH, 

REPORTS, AND ADVOCACY.

Performance Measure 2.3.1: Workshops, seminars, 

conferences, and hearings convened or cosponsored 

that involve significant competition-related issues.

Definition and background: This measure ensures 

that consumer benefits are enhanced through policy 

related activities such as workshops, seminars, 

conferences, and hearings convened or cosponsored 

that involve significant competition-related issues. 

The measure is calculated by counting the number 

e 

t 

d 

t 

e 
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154 Federal Trade Commission | Performance and Accountability Report 

of competition-related workshops, hearings and 

conferences hosted by the FTC.

Data sources: Information on conferences involving 

significant competition related issues is taken from the 

FTC’s website (www.ftc.gov/ftc/workshops.shtm) and 

from press releases.

Verification and validation: Data is received from 

staff attorneys, internal databases and press releases. 

The data is entered into a bureau database by staff, and 

reviewed monthly by analysts, attorneys, economists, 

and senior management.

Data limitations: Review is necessary to ensure 

that all competition-related workshops, hearings and 

conferences are identified.

Performance Measure 2.3.2: Reports and studies 

issued on key competition-related topics.

Definition and background: The measure tracks 

competition policy related activities such as research, 

reports, and studies that enhance consumers’ knowledge

of competition issues. The measure is calculated by 

counting the number of the reports and studies issued 

by the FTC.

Data sources: Information on studies and reports on 

significant competition-related issues is taken from the 

FTC’s website (www.ftc.gov/be/research.shtm and 

www.ftc.gov/reports/index.shtm).

Verification and validation: See measure 2.3.1.

Data limitations: See measure 2.3.1.

Performance Measure 2.3.3: Advocacy comments and

amicus briefs on competition issues filed with entities 

including federal and state legislatures, agencies or 

courts.

Definition and background: This measure tracks the 

number of advocacy comments and amicus briefs on 

competition matters filed with entities including federal 

and state legislatures, agencies, or courts to measure 

the output of the FTC’s advocacy activities relating to 

competition matters.

Data sources: Internal matter records of advocacy 

comments and amicus briefs filed (e.g., records available

in the FTC’s document management system).

Verification and validation: Review internal matter 

records of advocacy comments and amicus briefs 

filed (e.g., records available in the FTC’s document 

management system) and confirm data with staff 

having responsibilities for advocacy matters.

Data limitations: There are no significant data 

limitations. 

Performance Measure 2.3.4: The percentage of 

respondents finding the FTC’s advocacy comments and 

amicus briefs “useful.”

Definition and background: This measure tracks the 

percentage of respondents finding the FTC’s advocacy 

comments and amicus briefs to be “useful,” in order to 

assess the effect of competition advocacy comments.

Data sources: Responses to a written survey, sent by 

agency staff to advocacy recipients (except courts), to 

evaluate the usefulness of an advocacy.

Verification and validation: Agency staff review 

written responses in order to determine percentage of 

respondents describing the FTC’s advocacy comments 

as “useful.”

Data limitations: There are no significant data 

limitations.

Performance Measure 2.3.5: The volume of traffic on 

www.ftc.gov relating to competition research, reports, 

and advocacy.

Definition and background: This measure ensures 

the agency’s policy related activities enhance consumer 

benefit by providing practitioners and consumers with 

opportunities to interact with the staff and to learn 

about the agency’s enforcement and policy priorities. 

The measure is calculated by summing the views 

registered on the website of a subset of the competition 

related pages that pertain to advocacy, research, and 

international activities.

Data sources: The agency’s software that monitors 

traffic on the FTC’s external website, the Office of 

International Affairs, and the Office of Policy Planning.

Verification and validation: See measure 2.3.1.

Data limitations: The analysis is dependent on the 

accuracy of the measurements made by the web 

tracking software, and the presence of internal and 

external traffic filters. The data is also dependent on 

the accurate identification of relevant FTC web-based 

materials.
155appendices

fiscal year 2012

OBjECTIVE 2.4: PROTECT AMERICAN 

CONSUMERS IN THE GLOBAL 

MARKETPLACE BY PROVIDING SOUND 

POLICY RECOMMENDATIONS AND 

TECHNICAL ADVICE TO FOREIGN 

GOVERNMENTS AND INTERNATIONAL

ORGANIzATIONS TO PROMOTE SOUND

COMPETITION POLICY.

Performance Measure 2.4.1: Policy advice provided 

to foreign competition agencies, directly and through 

international organizations, through substantive 

consultations, written submissions, or comments.

Definition and background: This measure tracks the 

policy advice provided to foreign competition agencies, 

directly and through international organizations, 

through substantive consultations, written submissions, 

or comments excluding casual contacts.

Data sources: OIA weekly reports. 

Verification and validation: Agency staff create a 

draft list of events that fall within the scope of the 

measure, which is then submitted to attorneys for 

review. Managers review and ensure that the matters 

reported qualify as substantive policy advice.

Data limitations: Review is necessary to ensure that 

instances of policy advice reported are sufficiently 

substantive.

Performance Measure 2.4.2: Technical assistance 

provided to foreign competition authorities.

Definition and background: This measure tracks 

the number of long term and short term technical 

assistance missions and international fellows and intern

hosted.

Data sources: OIA weekly reports and Technical 

Assistance calendar. 

Verification and validation: See measure 2.4.1. 

Data limitations: Review is necessary to ensure that 

reported items qualify as technical assistance missions.

s 

STRATEGIC GOAL 3: ADVANCE 

PERFORMANCE

OBjECTIVE 3.1: PROVIDE EFFECTIVE 

HUMAN RESOURCES MANAGEMENT.

Performance Measure 3.1.1: The extent to which 

employees believe their organizational culture promotes 

improvement in processes, products and services, and 

organizational outcomes.

Definition and background: This measure gauges the 

extent employees believe their organizational culture 

promotes improvement in processes, products and 

services, and organizational outcomes so that the FTC 

has a strong foundation of organizational, individual, 

and management excellence driving mission success.

Data sources: The Federal Employee Viewpoint 

Survey is administered annually by the U.S. Office of 

Personnel Management (OPM). The Federal Employee 

Viewpoint Survey is a tool that measures employees’ 

perceptions of whether, and to what extent, conditions 

that characterize successful organizations are present. 

This survey was administered for the first time in 2002, 

and then repeated in 2004, 2006, 2008, 2010, 2011, 

and most recently in 2012. OPM transmits the agency 

results to the FTC’s Human Capital Management 

Office.

Verification and validation: Data collected is 

weighted by statisticians to produce survey estimates 

that accurately represent the survey population and 

adjust for differences between the characteristics of 

the survey respondents and the population of federal 

employees surveyed. The weights developed take into 

account the variable probabilities of selection across 

sample domains, nonresponse, and known demographic 

characteristics of the survey population.

Data limitations: The survey results represent a 

snapshot in time of the perceptions of the workforce. 

The Government-wide results have a plus or minus 1 

percent margin of error.

Performance Measure 3.1.2: The extent employees 

think the organization has the talent necessary to 

achieve organizational goals.

Definition and background: This measure gauges 

the extent employees think the organization has the 

talent necessary to achieve organizational goals so that 

the FTC has a strong foundation of organizational, 

individual, and management excellence driving mission 

success.
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156 Federal Trade Commission | Performance and Accountability Report 

Data sources: See measure 3.1.1.

Verification and validation: See measure 3.1.1.

Data limitations: See measure 3.1.1.

OBjECTIVE 3.2: PROVIDE EFFECTIVE 

INFRASTRUCTURE AND SECURITY 

MANAGEMENT.

Performance Measure 3.2.1: A favorable Continuit

of Operations (COOP) rating.

Definition and background: The FTC ensures a sa

and secure workplace through the development and 

implementation of the FTC COOP. The FTC COO

defines the necessary planning and actions that are 

required to ensure the preservation and performance 

of the FTC Mission Essential Functions (MEFs). 

Continuity planning facilitates the performance of 

FTC MEFs during all-hazards emergencies or other 

situations that may disrupt or potentially disrupt nor

operations. The FTC participated in the governmentwide Eagle Horizon Exercise to test and verify the 

effectiveness of the FTC COOP. An analysis of the 

plan and exercise is conducted with a combination of

Federal Emergency Management Agency (FEMA), 

self and peer review. An overall score is derived for 

the exercise using the average numeric rating for each

element of the review.

Data sources: The data on performance of the CO

exercise is generated using standard evaluation protoc

developed by FEMA.

Verification and validation: The review of the FTC

COOP was conducted independently by a FEMA 

representative and the evaluation of the Eagle Horiz

Exercise was conducted by an internal FTC team, wh

then submitted the data to FEMA. The FTC Health 

and Safety Officer provided an overall review to mak

sure that the data is complete and accurate.

Data limitations: The overall score is based on 

subjective analysis of the COOP and performance of

the exercise designed to give an overall evaluation of 

the COOP and identify improvement opportunities. 

The subjective nature of the data limits its usefulness

trend or comparative analysis.

Performance Measure 3.2.2: Availability of 

information technology systems.

Definition and background: This measure 

tracks unplanned service outages and monitors the 

reliability of 31 critical information technology 

services including: email, FTC-specific applications 

y 

fe 

P 

mal 

OP 

ol 

on 

en 

e 

 in 

and systems, BlackBerry servers, Internet/Intranet, 

telecommunications (includes phone and voicemail 

services), Wide Area Network, the agency’s primary 

public website (www.ftc.gov), remote employee access, 

printing, and enterprise-wide applications.

Data sources: System and network engineers record 

system or component outage data as part of the 

OCIO’s Change Management procedure.

Verification and validation: Outage timeframes are 

verified by correlating outages to system alerts and data 

recorded in the change management database.

Data limitations: The agency uses a manual tracking 

process to record the outage data in a spreadsheet. 

The reliability of the data depends on compliance with 

the change management procedure. The agency is 

currently working to implement SolarWinds, a network 

performance monitoring tool that will provide early 

warning notifications regarding changes to application 

performance and generate outage and downtime data.

OBjECTIVE 3.3: PROVIDE EFFECTIVE 

INFORMATION RESOURCES 

MANAGEMENT.

Performance Measure 3.3.1: The percentage of 

Commission-approved documents in the FTC’s 

ongoing and newly initiated proceedings available via 

the Internet within 15 days of becoming part of the 

public record.

Definition and background: This performance 

measure was created in an effort to promote 

agency transparency and ensure that documents the 

Commission approves are made available to the public 

in a timely manner. The Commission approves public 

documents by majority vote. These votes are tracked 

by the Office of the Secretary (OS) and are counted 

each quarter. Once the Commission approves a public 

document, the Office of Public Affairs works with 

agency staff to determine whether to publish a news 

release announcing the document. OS works to make 

sure the document is posted to ftc.gov at the same time 

as the news release or, if there is no news release, as 

soon as feasible. The agency sometimes waits to post 

a specific document to ftc.gov in order to maximize 

consumer impact by posting it in conjunction with 

several related matters. To arrive at the performance 

measure, we count the total number of Commission 

votes on public documents. Next, we count the number 

of public documents that were posted to ftc.gov within 
157appendices

fiscal year 2012

15 days after Commission approval. Then, we divide 

this number by the total number of public documents 

to arrive at a percentage. We do not include any 

documents that a court has placed under seal until the 

court lifts the seal, because documents under seal are 

not available to the public. Also, we do not count as 

“posted to the Internet” documents that are unavailable 

on ftc.gov, even if they are available elsewhere on the 

Internet (e.g., in electronic filing systems used by the 

federal courts).

Data sources: The data is compiled from Commission 

voting records, FTC news releases, and FTC Web Team 

confirmations that documents have been posted to 

www.ftc.gov. 

Verification and validation: Agency staff and 

management verify that the data showing all 

Commission-approved public documents for a specific 

quarter is complete and accurate by reviewing the 

actual Commission votes. We verify the accuracy of the 

date a document is posted to ftc.gov by checking the 

date against the FTC Web Team confirmation that the 

document has been posted. At the time a document is 

posted to ftc.gov, we test the web link to the document 

to confirm it is operational. FTC’s OS management 

reviews the source materials and counts to make sure 

the data is complete and accurate. 

Data limitations: This measure only includes 

Commission-approved public documents.

OBjECTIVE 3.4: PROVIDE EFFECTIVE 

FINANCIAL AND ACqUISITION 

MANAGEMENT.

Performance Measure 3.4.1: Independent auditor’s 

financial statement audit results.

Definition and background: Independent auditor’s 

opinion based on auditor’s review and tests of internal 

controls over operations and financial reporting and the 

determination that the financial statements and notes 

are fairly presented. The measure formula is 100% if an 

unqualified or “clean” opinion (the financial statements 

are fairly presented) is achieved or 0% for all other 

opinion types (qualified, adverse, disclaimer).

Data sources: Independent auditor’s opinion of yearend financial statements.

Verification and validation: FTC’s independent 

auditors render their opinion to the agency. 

Data limitations: There are no significant data 

limitations.

Performance Measure 3.4.2: The percentage of 

Bureaus/Offices that establish and maintain an 

effective, risk-based internal control environment.

Definition and background: This measure tracks 

the percentage of Bureaus/Offices that establish 

and maintain an effective, risk-based internal control 

environment.

Data sources: FMFIA Annual Statement of Assurance

Verification and validation: As basis for the FTC’s 

annual statement of assurance, agency staff distribute 

an annual survey to key agency management and 

staff which includes detailed questions about their 

internal controls. Staff verify that survey responses 

have been received by each of the Bureaus/Offices 

(assessable units), verify the percentage of the Bureaus/

Offices that indicate they maintain an effective internal 

control environment (supported by an internal control 

assessment), and staff and management review the final 

compilation of assessments. 

Data limitations: Internal control survey responses are 

dependent on the respondent’s understanding of their 

programs.

Performance Measure 3.4.3: Performance against the 

Small Business Administration’s government-wide small 

business procurement goals.

Definition and background: This measure identifies 

quarterly and annual awards of contract dollars to small 

business entities as a ratio against total dollars available 

for a set-aside for small business awards in whole or 

part. The accumulation, ratio analysis, and agency 

targets are managed by SBA. The internal operations of 

the Federal Procurement Data System- Next Generation 

(FPDS-NG) application, through which the measure is 

reported, are managed by GSA.

Data sources: FPDS-NG, found at www.fpds.gov

Verification and validation: FTC’s acquisition staff 

performs a statistical analysis annually and certifies the 

statistical validity of the FPDS-NG data.

Data limitations: There are no significant data 

limitations.
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158 Federal Trade Commission | Performance and Accountability Report 

APPENDIX B: ACRONYMS

ACO Accountable Care Organization 

APA Administrative Procedure Act 

APEC Asia Pacific Economic Cooperation

ACSI American Customer Satisfaction Index 

BC Bureau of Competition 

BCP Bureau of Consumer Protection 

BE Bureau of Economics 

COOP Continuity of Operations Plan 

COPPA Children’s Online Privacy Protection Act 

CRSS Consumer Response Systems and Services 

CSN Consumer Sentinel Network 

CSRS Civil Service Retirement System 

DNC Do Not Call 

DOJ Department of Justice 

DOL Department of Labor 

ERCR Electronic Recordkeeping Certification Review 

FASAB Federal Accounting Standards Advisory Board 

FBWT Fund Balance with Treasury 

FECA Federal Employee’s Compensation Act 

FEGLIP Federal Employees Group Life Insurance Program 

FEHBP Federal Employees Health Benefit Program 

FEMA Federal Emergency Management Agency 

FERS Federal Employees Retirement System 

FICA Federal Insurance Contributions Act 

FISMA Federal Information Security Management Act 

FMFIA Federal Managers’ Financial Integrity Act 

FTC Federal Trade Commission 

FTE Full-Time Equivalent 

FY Fiscal Year 

GAAP Generally Accepted Accounting Principles 

GAO Government Accountability Office 

GPRA Government Performance and Results Act 

GSA General Services Administration 

HSR Hart-Scott-Rodino Act 

IG Inspector General 

IPERA Improper Payments Elimination and Recovery Act
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fiscal year 2012

MC Maintain Competition 

MD&A Management’s Discussion and Analysis 

N/A Not Applicable or Not Available 

NIST National Institute of Standards and Technology 

OCIO Office of the Chief Information Officer 

OIG Office of Inspector General 

OMB Office of Management and Budget 

OPM Office of Personnel Management 

ORB Other Retirement Benefits 

PAR Performance and Accountability Report 

PC Protect Consumers 

SBR Statement of Budgetary Resources 

SOA Statement of Assurance 

TAS Treasury Account Symbol 

TSP Thrift Savings Plan 

TTY Text Telephone or Telephone Typewriter 

U.S. United States 

U.S. SAFE WEB Act Undertaking Spam, Spyware, And Fraud Enforcement with Enforcers beyon

 Borders Act of 2006

d
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160 Federal Trade Commission | Performance and Accountability Report 

APPENDIX C: OTHER USEFUL LINkS

INTRODUCTION:

• Accountability of Tax Dollars Act of 2002: 

http://www.whitehouse.gov/sites/default/files/omb/assets/about_omb/107-2891.pdf

• Association for Government Accountant’s Certificate of Excellence in Accountability Reporting (CEAR): 

http://www.agacgfm.org/Advocacy---Accountability/Certification-of-Excellence-in-Accountability-Repo.

aspx

• Clayton Act: http://www.law.cornell.edu/uscode/html/uscode15/usc_sec_15_00000012----000-.html

• Fair Credit Reporting Act: http://www.ftc.gov/os/statutes/031224fcra.pdf

• Federal Managers’ Financial Integrity Act of 1982 (FMFIA): 

http://www.whitehouse.gov/omb/financial_fmfia1982

• Federal Trade Commission Act: http://www.ftc.gov/ogc/ftcact.shtm

• Government Management Reform Act of 1994: 

http://govinfo.library.unt.edu/npr/library/misc/s2170.html

• Government Performance and Results Act of 1993 (GPRA): 

http://www.whitehouse.gov/omb/mgmt-gpra/gplaw2m

• GPRA Modernization Act of 2010: 

http://www.gpo.gov/fdsys/pkg/PLAW-111publ352/pdf/PLAW-111publ352.pdf

• Identity Theft Act: http://www.ftc.gov/os/statutes/itada/itadact.htm

• Improper Payments Information Act of 2002: http://www.whitehouse.gov/omb/financial_fia_improper/

• Reports Consolidation Act of 2000: 

http://www.gpo.gov/fdsys/pkg/PLAW-106publ531/pdf/PLAW-106publ531.pdf

• Telemarketing Sales Rule: http://www.ftc.gov/bcp/rulemaking/tsr/index.shtml

MD&A:

• Accountable Care Organizations (ACOs) overview: https://www.cms.gov/ACO

• Affordable Care Act: http://www.gpo.gov/fdsys/pkg/PLAW-111publ148/pdf/PLAW-111publ148.pdf

• American Customer Satisfaction Index (ACSI): http://www.theacsi.org

• Children’s Online Privacy Protection Act (COPPA) Rule: 

http://business.ftc.gov/privacy-and-security/children%E2%80%99s-online-privacy

• Circular A-123, “Management’s Responsibility for Internal Control”: 

http://www.whitehouse.gov/omb/circulars_a123_rev/

• Commission’s Prohibition of Energy Market Manipulation Rule: 

http://www.ftc.gov/os/2009/08/P082900mmr_finalrule.pdf

• Debt Collection Improvement Act of 1996: http://www.dol.gov/ocfo/media/regs/DCIA.pdf

• Equal Credit Opportunity Act: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre15.shtm

• Federal Human Capital Survey: http://www.fedview.opm.gov

• Federal Information Security Management Act (FISMA): 

http://csrc.nist.gov/drivers/documents/FISMA-final.pdf

• FTC Guides for the Use of Environmental Marketing Claims: 

http://www.ftc.gov/bcp/edu/microsites/energy/about_guides.shtml

• Gasoline and Diesel Price Monitoring Project: http://www.ftc.gov/ftc/oilgas/gas_price.htm

• Government Accountability Office (GAO) Auditing Resources: http://www.gao.gov/aac.html

• International Competition Network: http://www.internationalcompetitionnetwork.org

• Managed Trusted Internet Protocol Service: http://www.gsa.gov/portal/content/104213

• Mortgage Assistance Relief Services Rule: 

http://business.ftc.gov/documents/bus76-mortgage-assistance-relief-services-rule
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fiscal year 2012

• Office of Inspector General (OIG): http://www.ftc.gov/oig/

• Prompt Payment Act: http://www.fms.treas.gov/prompt/regulations.html

• Trusted Internet Connection: http://www.dhs.gov/files/programs/gc_1268754123028.shtm 

• We Don’t Serve Teens: http://www.dontserveteens.gov

PERFORMANCE:

• Asia Pacific Economic Cooperation: http://www.apec.org/ 

• Complaint Assistant: https://www.ftccomplaintassistant.gov

• Consumer Sentinel: http://www.ftc.gov/sentinel/

• Hart-Scott-Rodino (HSR) Act: http://www.ftc.gov/bc/hsr

• Home Mortgage Disclosure Act: http://www.fdic.gov/regulations/laws/rules/6500-3030.html

• Human Capital Assessment and Accountability Framework: 

http://www.opm.gov/hcaaf_resource_center/2-1.asp

• National Do Not Call Registry: www.donotcall.gov 

• Net Cetera: Chatting with Kids about Being Online: 

http://onguardonline.gov/features/feature-0004-featured-net-cetera-toolkit

• Undertaking Spam, Spyware, And Fraud Enforcement With Enforcers beyond Borders Act of 2006 

SAFE WEB Act): http://www.gpo.gov/fdsys/pkg/PLAW-109publ455/pdf/PLAW-109publ455.pdf

(U.S

OTHER ACCOMPANYING INFORMATION:

• Improper Payments Elimination and Recovery Act (IPERA): 

http://www.gpo.gov/fdsys/pkg/BILLS-111s1508enr/pdf/BILLS-111s1508enr.pdf 

. 
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162 Federal Trade Commission | Performance and Accountability Report 

CONSUMER RESpONSE CENTER

General Complaints 877-FTC-HELP (877-382-4357)

Identity Theft Complaints 877-ID-THEFT (877-438-4338)

Online General Complaints www.ftc.gov/complaint

Identity Theft Education www.ftc.gov/idtheft

and Complaints

National Do Not Call Registry www.donotcall.gov

APPENDIX D: CONTACT INFORMATION

AND ACkNOWLEDGEMENTS

FEDERAL TRADE COMMISSION 600 Pennsylvania Avenue, NW

Washington, DC 20580

General Information Number 202-326-2222

Internet Home Page www.ftc.gov

FTC Spanish Home Page www.ftc.gov/espanol

Strategic Plan Internet Site www.ftc.gov/strategicplan

FTC Press Releases www.ftc.gov/opa/pressold.shtm
163appendices

fiscal year 2012

ACkNOwLEDGEMENTS

The FTC gratefully acknowledges the following indiduals who made a significant contribution in 

producing this report: Joni Lupovitz of the Office of the Chairman; James Baker, Benjamin Besse, 

William Black, Chloe Collins, Steven Fisher, Ted Franklin, Antonio Gomez, Valerie Green, James Hale, 

Eileen Harrington, Karen Leydon, Nancy Lux, Mary Kate Markano, Kimberly Mayo, Jeff Nakrin, 

Mark Oemler, Mary Beth Richards, Randall Salzer, Jon Schroeder, Lori Walsh-Van Wey, and Milissa 

Young-Loiselle of the Office of the Executive Director; Don Clark and April Tabor of the Office of 

the Secretary; Jeanine Balbach, Brittany Bryant, Nathan Hawthorne and Joseph Remy of the Bureau 

of Competition; Gregory Fortsch and Jenny Kellogg of the Bureau of Consumer Protection; Russell 

Damtoft and Lauren Skerrett of the Office of International Affairs; and Christopher Grengs of the 

Office of Policy Planning for contributing to the development of this report. Editorial and design work 

supported by LMI and Fathom Creative.
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164 Federal Trade Commission | Performance and Accountability Report 

commission

is critical to protecting and strengthen

free & open markets

and promoting informe

consumer choice,

both in the united states

and around the world

www.ftc.go

/federaltradecommission

@

ftc.gov

federal trade

The work of th