PART 2: Annual Financial Report

Table presented on page 59

(PDF Page 22)

Consolidated Statement of Changes in Net Position 

For the Fiscal Year Ended September 30, 2012

(In Millions)

Combined

Earmarked

Funds

Combined

All Other

Funds

EliminationConsolidated

Total

CUMULATIVE RESULTS OF OPERATIONS

Beginning Balance $ 43,611 $ (306,451) $ - $ (262,840)

Budgetary Financing Sources

Appropriations Used (Note 22) 492 427,987 - 428,479

Non-Exchange Revenue 423 200 (3) 620

Donations and Forfeitures of Cash/Equivalent 186 - - 186

Transfers In/Out Without Reimbursement (129) 129 - -

Other 15 133 - 148

Other Financing Sources (Non-Exchange)

Donation/Forfeiture of Property 174 - - 174

Accrued Interest and Discount on Debt (Note 22) - 95,877 - 95,877

Transfers In/Out Without Reimbursement (87) 40 - (47)

Imputed Financing Sources (Note 21) 64 1,266 (518) 812

Transfers to the General Fund and Other (Note 20) 101 (46,442) - (46,341)

Total Financing Sources 1,239 479,190 (521) 479,908

Net Cost of Treasury Operations and Non-Entity Costs (1,827) (143,875) 521 (145,181)

Net Change (588) 335,315 - 334,727

Cumulative Results of Operations 43,023 28,864 - 71,887

UNEXPENDED APPROPRIATIONS

Beginning Balance 200 342,778 - 342,978

Budgetary Financing Sources

Appropriations Received (Notes 20 and 22) 492 418,638 - 419,130

Appropriations Transferred In/Out - 142 - 142

Other Adjustments - (16,262) - (16,262)

Appropriations Used (Note 22) (492) (427,987) - (428,479)

Total Budgetary Financing Sources - (25,469) - (25,469)

Total Unexpended Appropriations 200 317,309 - 317,509

Net Position $ 43,223 $ 346,173 $ - $ 389,396

The accompanying notes are an integral part of these financial statements.
Table presented on page 60

(PDF Page 23)

Consolidated Statement of Changes in Net Position 

For the Fiscal Year Ended September 30, 2011

(In Millions)

Combined

Earmarked

Funds

Combined

All Other

Funds

Elimination Consolidated

Total

CUMULATIVE RESULTS OF OPERATIONS

Beginning Balance $ 41,426 $ (340,887) $ - $ (299,461)

Budgetary Financing Sources

Appropriations Used 536 547,593 - 548,129

Non-Exchange Revenue 230 154 (5) 379

Donations and Forfeitures of Cash/Equivalent 586 - - 586

Transfers In/Out Without Reimbursement (51) 51 - -

Other - 4,550 - 4,550

Other Financing Sources (Non-Exchange)

Donation/Forfeiture of Property 163 - - 163

Accrued Interest and Discount on Debt - 14,042 - 14,042

Transfers In/Out Without Reimbursement (97) 37 - (60)

Imputed Financing Sources (Note 21) 75 1,265 (415) 925

Transfers to the General Fund and Other (Note 20) 249 (128,187) - (127,938)

Total Financing Sources 1,691 439,505 (420) 440,776

Net Cost of Treasury Operations and Non-Entity Costs 494 (405,069) 420 (404,155)

Net Change 2,185 34,436 - 36,621

Cumulative Results of Operations 43,611 (306,451) - (262,840)

UNEXPENDED APPROPRIATIONS

Beginning Balances 200 400,357 - 400,557

Budgetary Financing Sources

Appropriations Received (Note 20) 536 498,187 - 498,723

Appropriations Transferred In/Out - 129 - 129

Other Adjustments - (8,302) - (8,302)

Appropriations Used (536) (547,593) - (548,129)

Total Budgetary Financing Sources - (57,579) - (57,579)

Total Unexpended Appropriations 200 342,778 - 342,978

Net Position $ 43,811 $ 36,327 $ - $ 80,138

The accompanying notes are an integral part of these financial statements.
Table presented on page 61

(PDF Page 24)

Combined Statement of Budgetary Resources 

For the Fiscal Year Ended September 30, 2012

(In Millions)

BUDGETARY RESOURCES Budgetary

NonBudgetary

Financing 

2012

Total

Unobligated balance brought forward, October 1 $ 340,384 $ 28,570 $ 368,954

Recoveries of prior year unpaid obligations 2,818 10,531 13,349

Other changes in unobligated balance (3,542) (37,484) (41,026)

Unobligated balance from prior year budget authority, net 339,660 1,617 341,277

Appropriations (discretionary and mandatory) (Notes 20 and 22) 429,535 - 429,535

Borrowing authority (discretionary and mandatory) (Note 22) - 11,019 11,019

Spending authority from offsetting collections 9,727 24,503 34,230

Total Budgetary Resources 778,922 $ 37,139 $ 816,061

STATUS OF BUDGETARY RESOURCES

Obligations incurred (Note 22) $ 458,137 $ 18,326 $ 476,463

Unobligated balance, end of year:

 Apportioned 227,587 3,948 231,535

 Exempt from apportionment 23,692 - 23,692

 Unapportioned 69,506 14,865 84,371

Total unobligated balance brought forward, end of year 320,785 18,813 339,598

Total Status of Budgetary Resources $ 778,922 $ 37,139 $ 816,061

CHANGE IN OBLIGATED BALANCE

Unpaid obligations, gross, brought forward, October 1 $ 148,351 $ 123,802 $ 272,153

Uncollected customer payments from federal sources, brought 

forward, October 1 (201) (969) (1,170)

Obligated balance, net, start of year 148,150 122,833 270,983

Obligations incurred (Note 22) 458,137 18,326 476,463

Outlays, gross (461,363) (20,731) (482,094)

Change in uncollected customer payments from federal 

 sources 15 151 166

Recoveries of prior year unpaid obligations (2,818) (10,531) (13,349)

Obligated balance, end of year:

 Unpaid obligations, gross, end of year 142,307 110,866 253,173

 Uncollected customer payments from federal sources, end 

 of year (186) (818) (1,004)

Obligated Balance, End of Year $ 142,121 $ 110,048 $ 252,169

BUDGET AUTHORITY AND OUTLAYS, NET

Budget authority, gross (discretionary and mandatory) $ 439,262 $ 35,522 $ 474,784

Actual offsetting collections (discretionary and mandatory) (9,743) (157,152) (166,895)

Change in uncollected customer payments from federal sources 

(discretionary and mandatory) 15 151 166

Budget Authority, net (Discretionary and Mandatory) $ 429,534 $ (121,479) $ 308,055

Outlays, gross (discretionary and mandatory) $ 461,363 $ 20,731 $ 482,094

Actual offsetting collections (discretionary and mandatory) (9,743) (157,152) (166,895)

Outlays, net (discretionary and mandatory) 451,620 (136,421) 315,199

Distributed offsetting receipts (73,881) - (73,881)

Agency Outlays, Net (Discretionary and Mandatory) $ 377,739 $ (136,421) $ 241,318
Table presented on page 62

(PDF Page 25)

Combined Statement of Budgetary Resources 

For the Fiscal Year Ended September 30, 2011

(In Millions)

BUDGETARY RESOURCES Budgetary

NonBudgetary

Financing 

2011

Total

Unobligated balance brought forward, October 1 $ 348,424 $ 23,819 $ 372,243

Recoveries of prior year unpaid obligations 11,058 5,671 16,729

Other changes in unobligated balance (329) (22,697) (23,026)

Unobligated balance from prior year budget authority, net 359,153 6,793 365,946

Appropriations (discretionary and mandatory) (Note 20) 508,591 (12,403) 496,188

Borrowing authority (discretionary and mandatory) (Note 22) 1 157,059 157,060

Spending authority from offsetting collections 11,048 58,759 69,807

Total Budgetary Resources $ 878,793 $ 210,208 $ 1,089,001

STATUS OF BUDGETARY RESOURCES

Obligations incurred (Note 22) $ 538,409 $ 181,638 $ 720,047

Unobligated balance, end of year:

 Apportioned 246,296 510 246,806

 Exempt from apportionment 23,980 - 23,980

 Unapportioned 70,108 28,060 98,168

Total unobligated balance brought forward, end of year 340,384 28,570 368,954

Total Status of Budgetary Resources $ 878,793 $ 210,208 $ 1,089,001

CHANGE IN OBLIGATED BALANCE

Unpaid obligations, gross, brought forward, October 1 $ 182,707 $ 49,491 $ 232,198

Uncollected customer payments from federal sources, brought 

forward, October 1 (192) (23,817) (24,009)

Obligated balance, net, start of year 182,515 25,674 208,189

Obligations incurred (Note 22) 538,409 181,638 720,047

Outlays, gross (561,707) (101,655) (663,362)

Change in uncollected customer payments from federal 

 sources (9) 22,847 22,838

Recoveries of prior year unpaid obligations (11,058) (5,671) (16,729)

Obligated balance, end of year:

 Unpaid obligations gross, end of year 148,351 123,802 272,153

 Uncollected customer payments from federal sources, end 

 of year (201) (969) (1,170)

Obligated balance, End of Year $ 148,150 $ 122,833 $ 270,983

BUDGET AUTHORITY AND OUTLAYS, NET

Budget authority, gross (discretionary and mandatory) $ 519,640 $ 203,415 $ 723,055

Actual offsetting collections (discretionary and mandatory) (11,048) (219,002) (230,050)

Change in uncollected customer payments from federal 

sources (discretionary and mandatory) (9) 22,847 22,838

Budget Authority, net (Discretionary and Mandatory) $ 508,583 $ 7,260 $ 515,843

Outlays, gross (discretionary and mandatory) $ 561,707 $ 101,655 $ 663,362

Actual offsetting collections (discretionary and mandatory) (11,048) (219,002) (230,050)

Outlays, net (discretionary and mandatory) 550,659 (117,347) 433,312

Distributed offsetting receipts (119,958) - (119,958)

Agency Outlays, Net (Discretionary and Mandatory) $ 430,701 $ (117,347) $ 313,354
Table presented on page 63

(PDF Page 26)

Statements of Custodial Activity 

For the Fiscal Years Ended September 30, 2012 and 2011

(In Millions)

2012 2011

Sources of Custodial Revenue (Note 23)

Individual Income and FICA Taxes $ 2,159,990 $ 2,102,030

Corporate Income Taxes 281,462 242,848

Estate and Gift Taxes 14,450 9,079

Excise Taxes 79,554 72,794

Railroad Retirement Taxes 4,773 4,692

Unemployment Taxes 7,159 6,893

Deposit of Earnings, Federal Reserve System 81,957 82,546

Fines, Penalties, Interest, and Other Revenue 623 591

Total Revenue Received 2,629,968 2,521,473

Less Refunds (373,752) (416,221)

Net Revenue Received 2,256,216 2,105,252

Non-Cash Accrual Adjustment 5,543 (150)

Non-TARP Investments in American International Group, Inc. (Note 26):

Cash Proceeds from Sale of Stock 12,992 1,973

Non-Cash Market Adjustments (8,251) (9,944)

Total Custodial Revenue 2,266,500 2,097,131

Disposition of Custodial Revenue (Note 23)

Amounts Provided to Fund Non-Federal Entities 386 462

Amounts Provided to Fund the Federal Government 2,255,830 2,104,790

Non-Cash Accrual Adjustment

 Amounts to be Provided to the General Fund 4,000 -

 Accrual Adjustment 1,543 (150)

Non-TARP Investments in American International Group, Inc. (Note 26):

Cash Proceeds from Stock Sales Provided to Fund the Federal Government 12,992 1,973

Non-Cash Market Adjustment (8,251) (9,944)

Total Disposition of Custodial Revenue 2,266,500 2,097,131

Net Custodial Revenue $ - $ -

The accompanying notes are an integral part of these financial statements.
Table presented on page 79 

(PDF Page 42)

Fund Balance As of September 30, 2012 and 2011, 

fund balance consisted of the following (in millions):

2012 2011

Appropriated Funds $ 315,690 $ 344,913

Revolving Funds 26,698 35,464

Special Funds 976 721

Clearing Funds 681 392

Deposit Funds 163 170

Other Funds (principally Receipt, Trust, and Suspense Funds) 138 124

Total Fund Balance $ 344,346 $ 381,784

Table presented on page 80 

(PDF Page 43)

Status of Fund Balance As of September 30, 2012 and 2011, 

the status of the fund balance consisted of the following (in millions):

2012 2011

Unobligated Balance – Available $ 255,227 $ 270,786

Unobligated Balance - Not Available 84,371 98,168

Unpaid Obligations 252,169 270,983

Subtotal 591,767 639,937

Adjustment for Borrowing Authority (109,930) (123,844)

Adjustment for ESF (103,763) (105,026)

Adjustment for IMF (32,093) (27,065)

Adjustment for Intra-Treasury Investments (7,251) (7,024)

Adjustment for Non-Budgetary Funds 973 674

Adjustment for Authority Unavailable for Obligations 3,706 3,721

Other Adjustments 937 411

Total Status of Fund Balance $ 344,346 $ 381,784
Table presented on page 81 

(PDF Page 44)

As of September 30, 2012 and 2011, 

entity intra-governmental loans (issued by the FFB) and interest receivable consisted of 

the following 

(in millions):

Loans

Receivable

Interest

Receivable

2012

Total

Loans 

Receivable

Interest 

Receivable

2011

Total

Department of Agriculture $ 37,750 $ 343 $ 38,093 $ 34,178 $ 48 $ 34,226

United States Postal Service(1) 15,000 48 15,048 13,000 47 13,047

Department of Energy 12,171 35 12,206 6,929 15 6,944

General Services Administration 1,819 32 1,851 1,898 33 1,931

Other Agencies 1,123 7 1,130 1,083 8 1,091

Total Entity Intra-governmental $ 67,863 $ 465 $ 68,328 $ 57,088 $ 151 $ 57,239

(1) The United States Postal Service (USPS) experienced an operating deficit in fiscal year 2012. The Department, Congress, and other 

stakeholders are aware of the current and long-term financial issues of the USPS. Congress is considering legislative solutions for 

returning the USPS to financial stability. 
Table presented on page 96 

(PDF Page 59)

Trouble Asset Relief Program Direct Loans and Equity Investments

As of September 30, 2012 (in millions) CPP AIG AIFP PPIP

Other 

Programs 2012

Direct Loans and Equity Investment Programs:

Direct Loans and Equity Investment Outstanding, Gross $ 8,664 $ 6,727 $ 37,252 $ 9,763 $ 667 $ 63,073

Subsidy Cost Allowance (2,930) (1,658) (19,706) 1,015 437 (22,842)

Direct Loans and Equity Investments

 Outstanding, Net $ 5,734 $ 5,069 $ 17,546 $ 10,778 $ 1,104 $ 40,231

New Loans or Investments Disbursed $ - $ - $ - $ 1,048 $ - $ 1,048

Obligations for Loans and Investments Not Yet 

 Disbursed $ - $ - $ - $ 3,058 $ 1,300 $ 4,358

Reconciliation of Subsidy Cost Allowance: 

Balance, Beginning of Period $ 4,857 $ 20,717 $ 19,440 $ (2,434) $ (279) $ 42,301

 Subsidy Cost for Disbursements and Modifications 973 - - (31) - 942

 Interest and Dividend Revenue 572 191 534 1,426 10 2,733

 Net Proceeds from Sales and Repurchases of Assets in 

 Excess (Less than) Cost (285) (9,735) 9 223 - (9,788)

 Net Interest Income (Expense) on Borrowings from BPD 

 and Financing Account Balance (290) (349) (507) (439) (41) (1,626)

Balance, End of Period, Before Reestimates 5,827 10,824 19,476 (1,255) (310) 34,562

Subsidy Reestimates (2,897) (9,166) 230 240 (127) (11,720)

Balance, End of Period $ 2,930 $ 1,658 $ 19,706 $ (1,015) $ (437) $ 22,842

Reconciliation of Subsidy Cost: 

 Subsidy Cost for Disbursements $ - $ - $ - $ (31) $ - $ (31)

 Subsidy Cost for Modifications 973 - - - - 973

 Subsidy Reestimates (2,897) (9,166) 230 240 (127) (11,720)

Total Direct Loans and Equity Investment 

 Programs Subsidy Cost (Income) $ (1,924) $ (9,166) $ 230 $ 209 $ (127) $ (10,778)

As of September 30, 2011 (in millions) CPP AIG AIFP PPIP

Other 

Programs 2011

Direct Loans and Equity Investment Programs: 

Direct Loans and Equity Investment Outstanding, Gross $ 17,299 $ 51,087 $ 37,278 $ 15,943 $ 798 $ 122,405

Subsidy Cost Allowance (4,857) (20,717) (19,440) 2,434 279 (42,301)

Direct Loans and Equity Investments 

 Outstanding, Net $ 12,442 $ 30,370 $ 17,838 $ 18,377 $ 1,077 $ 80,104

New Loans or Investments Disbursed $ - $ 20,292 $ - $ 3,421 $ 126 $ 23,839

Obligations for Loans and Investments Not Yet 

 Disbursed $ - $ - $ - $ 4,279 $ 4,200 $ 8,479

Reconciliation of Subsidy Cost Allowance: 

Balance, Beginning of Period $ 1,546 $ 21,405 $ 14,529 $ (676) $ (59) $ 36,745

 Subsidy Cost for Disbursements and Modifications (1,010) 20,085 (174) (15) 1 18,887

 Interest and Dividend Revenue 1,283 450 1,280 428 20 3,461

 Fee Income - 165 - - - 165

 Net Proceeds from Sales and Repurchases of Assets in 

 Excess of (Less than) Cost 4,540 (1,918) (5,165) 91 190 (2,262)

 Net Interest Income (Expense) on Borrowings from BPD 

 and Financing Account Balance (686) (938) (945) (418) (29) (3,016)

Balance, End of Period, Before Reestimates 5,673 39,249 9,525 (590) 123 53,980

Subsidy Reestimates (816) (18,532) 9,915 (1,844) (402) (11,679)

Balance, End of Period $ 4,857 $ 20,717 $ 19,440 $ (2,434) $ (279) $ 42,301

Reconciliation of Subsidy Cost: 

 Subsidy Cost for Disbursements $ - $ 20,085 $ - $ (15) $ 1 $ 20,071

 Subsidy Cost for Modifications (1,010) - (174) - - (1,184)

 Subsidy Reestimates (816) (18,532) 9,915 (1,844) (402) (11,679)

Total Direct Loans and Equity Investment 

 Programs Subsidy Cost (Income) $ (1,826) $ 1,553 $ 9,741 $ (1,859) $ (401) $ 7,208
Table presented on page 99 

(PDF Page 62)

As of September 30, 2012 and 2011, 

the Department’s investments in the GSEs consisted of the following (in 

millions):

GSEs Investments

Gross

Investments

As of 9/30/12

Cumulative

Valuation

Loss

9/30/12

Fair Value

Fannie Mae Senior Preferred Stock $ 116,989 $ (51,331) $ 65,658

Freddie Mac Senior Preferred Stock 72,160 (30,224) 41,936

Fannie Mae Warrants Common Stock 3,104 (1,956) 1,148

Freddie Mac Warrants Common Stock 2,264 (1,664) 600

Total GSEs Investments $ 194,517 $ (85,175) $ 109,342

Table presented on page 101 

(PDF Page 64)

As of September 30, 2012 and 2011, 

the summarized unaudited aggregated financial condition of the GSEs was as follows (in 

millions):

2012 2011

Combined Assets

Investment Securities $ 338,974 $ 422,741

Mortgage Loans 4,641,231 4,715,057

Other 262,548 248,415

Total Combined Assets 5,242,753 5,386,213

Combined Liabilities

Long-Term Debt 4,963,297 4,974,759

Other 272,137 425,236

Total Combined Liabilities 5,235,434 5,399,995

Combined Net Equity (Deficit) $ 7,319 $ (13,782)

For the Nine Months Ended September 30 

Combined Net Interest Income $ 29,097 $ 28,832

Combined Provisions for Loan Losses (3,628) (28,672)

Combined Net Interest Income After Provision for Loan Losses $ 25,469 $ 160

Combined Regulatory Capital - Minimum Capital Deficit as of September 30 $ (231,949) $ (231,531)
Table presented on page 141 under Multilateral Development Banks

(PDF Page 104)

2012 2011

Inter-American Development Bank $ 32,786 $ 28,687

International Bank for Reconstruction and Development 31,805 29,966

Asian Development Bank 11,027 8,469

European Bank for Reconstruction and Development 3,055 1,803

African Development Bank 2,053 1,545

North American Development Bank 1,275 1,275

Multilateral Investment Guarantee Agency(1) 315 293

Total $ 82,316 $ 72,038
 PART 3: Other Accompanying Information

 Table Presented on Page 214 – 215

(PDF pages 68 -69)

Details of the Audit Reports with Potential Monetary Benefits

on Which Management Decisions Were Made On or Before September 30, 2011,

But Final Actions Have Not Been Taken as of September 30, 2012

(Dollars In Millions)

(Table presented on Next Page of this document)
Report No. Report 

Issue Date Brief Description

Disallowed 

Costs

Funds

Put to

Better Use

Revenue

EnhancementTotal Due Date

IRS 2006-1c-142 9/25/2006

The IRS Contracting Officer (CO) 

should use the results of the Defense 

Contract Audit Agency (DCAA) report 

to fulfill his/her duties in awarding 

and administering contracts.

$ 32.4 - - $ 32.4 10/15/2012

FY 2006 1 $ 32.4 $ 32.4

FY 2007 N/A - - - - N/A

FY 2008 N/A - - - - N/A

IRS 2009-10-107 7/24/2009

IRS should develop procedures 

requiring that workstation sharing 

levels are included in space needs 

assessments. When implementing 

these procedures, IRS should adjust its 

space needs to reflect workstation 

sharing and take action to release any 

unneeded space identified, where 

appropriate.

- 30.0 - 30.0 1/15/2014

IRS 2009-1c-134 9/28/2009

The IRS CO should use the results of 

the DCAA report to fulfill his/her 

duties in awarding and administering 

contracts.

0.1 - - 0.1 10/15/2012

FY 2009 2 $ 0.1 $ 30.0 $ 0 $30.1 

IRS 2010-40-117 9/14/2010

IRS should revise the criteria used to 

determine who will receive a notice to 

include individuals identified by the 

Duplicate TIN Use database when (1) a 

TIN is used as a secondary taxpayer on 

one tax return and as a dependent 

and/or for the EITC on another tax 

return, and (2) a TIN is used as a 

qualifying child for the child and 

dependent care credit, adoption credit, 

education credits, and child tax credit.

- 1,297.6 - 1,297.6 1/15/2013

FY 2010 1 $ 0 $ 1,297.6 $0 $1,297.6 

IRS 2011-1c-017 2/24/2011

IRS should use the DCAA audit report 

to fill his/her duties in awarding and 

administering contracts. When 

negotiations are completed, the CO 

will provide the TIGTA a copy of the 

Price Memorandum or other 

documentation of the actual cost 

savings achieved.

0.2 - - 0.2 2/24/2016

IRS 2011-1c-080 8/23/2011

The IRS CO should use the DCAA 

report in the administration of the 

contract and determine whether the 

questioned costs should be recovered. 0.1 - - 0.1 8/31/2016

IRS 2011-41-083 9/16/2011

IRS should revise the Form 8863 to 

require taxpayers to provide 

identifying information for the 

educational institution that the 

student(s) being claimed for the 

education credits attended.

- 6,829.5 - 6,829.5 1/15/2013

IRS 2011-30-112 9/26/2011

IRS should consider reducing the time 

between each Master File notice by 

seven days.

- - 1,800.0 1,800.0 1/15/2013

IRS 2011-1c-122 9/28/2011

The IRS CO should use the DCAA 

report in the administration of the 

contract and determine whether the 

questioned costs should be recovered.

28.6 - - 28.6 9/30/2016

OFS SIG-AR-11-

003 4/14/2011

OFS should review previously paid 

legal fee bills to identify unreasonable 

or unallowable charges, and seek 

reimbursement for those charges, as 

appropriate.

0.7 - - 0.7 4/30/2013

OFS SIG-AR-11-

004 9/28/2011

OFS should determine the allowability 

in questioned, unsupported legal fees 

and expenses paid to specified law 

firms.

8.1 - - 8.1 11/11/2012

FY 2011 7 $37.7 $6,829.5 $1,800.0 $8,667.2

Total 11 $70.2 $8,157.1 $1,800.0 $10,027.3