U.S. OCCUPATIONAL SAFETY & HEALTH 

REVIEW COMMISSION 

PERFORMANCE AND ACCOUNTABILITY REPORT, 

INDEPENDENT AUDITOR’S REPORT 

AND 

FINANCIAL STATEMENTS 

FOR THE YEARS ENDED 

SEPTEMBER 30, 2012 AND 2011 

Prepared By 

Brown & Company CPAs, PLLC 

November 5, 2012 
U.S. OCCUPATIONAL SAFETY & HEALTH REVIEW COMMISSION 

FINANCIAL STATEMENTS 

FOR THE YEAR ENDED SEPTEMBER 30, 2012 AND 2011 

TABLE OF CONTENTS 

AGENCY HEAD MESSAGE 

MANAGEMENT DISCUSSION AND ANALYSIS . .......................................................... 1 

FINANCIAL SECTION 

INDEPENDENT AUDITOR'S REPORT ON THE FINANCIAL STATEMENTS ............ 13 

INDEPENDENT AUDITOR’S REPORT ON INTERNAL CONTROL OVER 

 FINANCIAL REPORTING ................................................................................................. 15 

INDEPENDENT AUDITOR'S REPORT ON COMPLIANCE WITH LAWS AND 

 REGULATIONS................................................................................................................... 16 

BALANCE SHEET ............................................................................................................... 17 

STATEMENT OF NET COST ............................................................................................. 18 

STATEMENT OF CHANGES IN NET POSITION ............................................................. 19 

STATEMENT OF BUDGETARY RESOURCES ................................................................ 20 

STATEMENT OF CUSTODIAL ACTIVITY ..................................................................... 21 

NOTES TO THE FINANCIAL STATEMENTS .................................................................. 22 
 

1 

Occupational Safety and Health Review Commission 

FY 2012 Performance and Accountability Report 

Management Discussion and Analysis 

Overview 

The Occupational Safety and Health Review Commission (OSHRC or Review Commission) is 

an independent, adjudicatory agency created by the Occupational Safety and Health Act of 1970. 

Its sole statutory mandate is to serve as an administrative court providing fair and expeditious 

resolution of disputes involving the Occupational Safety and Health Administration (OSHA), 

employers charged with violations of Federal safety and health standards, and employees and/or 

their representatives. The Review Commission was created by Congress as an agency 

completely independent of the Department of Labor to ensure that OSHA’s enforcement actions 

are carried out in accordance with the law and that all parties are treated consistent with due 

process when disputes arise. 

The Occupational Safety and Health Act and the Review Commission’s Rules of Procedure 

provide for two levels of adjudication when an employer contests an OSHA citation for alleged 

violations of the Act or failure to abate such alleged violations. The first is a trial level, which 

affords an opportunity for a hearing before a Review Commission Administrative Law Judge 

(ALJ). The Judge’s decision becomes final unless the decision is directed for review to the 

Commission by an individual Commissioner. The second level of review is by Commission 

members who are appointed by the President with the advice and consent of the Senate. Both 

before its Judges and the Commissioners, the Review Commission provides fair and impartial 

adjudication of cases concerning the safety and health of employees’ working conditions in the 

United States. 

Mission and Organizational Structure

The mission of the Review Commission is to provide an impartial forum for the just and prompt 

adjudication of workplace safety and health disputes involving the Department of Labor, 

employers, and employees and/or their representatives under the Occupational Safety and Health 

Act of 1970. 

The Review Commission has three members, who serve six-year terms, each of whom is 

appointed by the President and confirmed by the Senate. One of the members also serves as 

Chairman of the agency. The Review Commission has three major functions: the Commission 

function, the Administrative Law Judge function, and the Office of the Executive Director 

function. 

The principal (national) office of the Review Commission is located in Washington, D.C. There 

are two regional offices, one in Atlanta, Georgia, and the other in Denver, Colorado. 
2 

Our vision is simple, direct and performance oriented. We strive to be: 

• A quasi-judicial body that is -- and is recognized for being -- objective, fair, 

prompt, and professional; 

• An agency that creates a body of law through its decisions that define and 

explain the rights and responsibilities of employers and employees under the 

Occupational Safety and Health Act of 1970; 

• A model Federal agency with highly effective processes, a highly motivated, 

qualified and diverse workforce, and modern information management, 

communications, and administrative systems; and; 

• An agency that values team work, develops its employees, and strives to 

improve its performance, service, and value to the American people. 

Challenges and Opportunities 

The Review Commission’s ability to meet its case disposition goals depend on a variety of 

factors. These include: (1) continued presence of a quorum at the Commission level; (2) the 

magnitude and nature of the cases received; (3) the success of the parties’ settlement negotiations 

and the Agency’s Simplified Proceedings and Mandatory Settlement programs in reducing the 

number of hearings needed; and (4) the number, location, length and complexity of hearings 

held. Although these factors are largely outside the Review Commission’s control, the Review 

Commission is committed to working within such constraints to improve its service to the public. 

The Commission consists of three members appointed by the President with the advice and 

consent of the Senate. The Occupational Safety and Health Act requires a quorum of two 

Commissioners. By statute, decisions can only be decided on the affirmative vote of two 

Commissioners. During periods when the Commission lacks a quorum, no cases can be decided. 

In addition, with only two Commissioners, it may be more difficult to reach agreement sufficient 

to dispose of some cases. In cases where such agreement cannot be reached, deadlocks result. 

Consequently, action on important issues may be postponed and issuance of some pending cases 

will be delayed. 

The Commission operated with only two Commissioners during FY 2012 due to the third 

Commissioner’s term expiring in FY 2011. 

The number of safety and health inspections carried out by OSHA each year, the nature of those 

inspections, and the rate at which employers choose to contest the citations issued and penalties 

proposed by OSHA all have an impact on the number of cases contested before the Review 

Commission. In addition, OSHA’s targeting during recent years of workplaces experiencing 

more serious workplace hazards, and the consequent increase in proposed penalties, has resulted 

in a greater number of complex cases, and more extensive pretrial and trial processes. 

Consequently, both the size and complexity of the cases at both the Administrative Law Judge 

and Commission levels has increased in recent years. 
3 

OSHA conducted 40,961 inspections in FY 2012. The number of OSHA inspections and their 

likely focus on the highest hazard workplaces affects the Review Commission’s ALJ caseload. 

These inspections have tended to result in more complex and contentious cases, which consume 

extensive judicial time. For such cases, the discovery process is lengthy and time consuming, 

motion practice is expanded, legal research and decision-writing time is protracted and, of 

necessity, the trial process is elongated and complicated. 

The Commission utilizes two alternative procedures to facilitate case adjudication in appropriate 

circumstances – Settlement Part, for certain relatively complex cases, and Simplified 

Proceedings, for certain relatively simple cases. 

Under Commission Rule 2200.120, where the parties consent thereto, the Chief Administrative 

Law Judge may assign a Settlement Judge to a pending proceeding to aid the parties in disposing 

of cases. Where the aggregate amount of the penalty sought by the Secretary of Labor is 

$100,000 or greater, the Mandatory Settlement procedure goes into effect. The Settlement Judge 

appointed by the Chief Administrative Law Judge has full control of the proceeding and may 

require that the parties’ representatives be accompanied by officials having full settlement 

authority. This procedure has aided the Commission in disposing of some extremely complex 

cases, with the approval of all parties. 

The Simplified Proceedings process has been expanded to include cases where proposed 

penalties are not more than $20,000, and up to $30,000, when found eligible by the Chief Judge. 

The Simplified Proceedings process allows parties with relatively simple cases to have their “day 

in court” unencumbered by the formal Rules of Procedure and evidence, while ensuring that due 

process requirements will be maintained. Under this process, a business, with or without 

counsel, can present its case before an administrative law judge and receive a prompt decision. 

Most paperwork, including legal filings, has been eliminated so that justice can be rendered 

swiftly and inexpensively. The process is intended to reduce the time and legal expenses to 

employers contesting relatively small penalty cases. 

Performance Goals and Results

OSHRC’s case resolution strategic goal is straightforward: To ensure fair, just, and expeditious 

adjudication of disputes brought before the Commission and its Administrative Law Judges. The 

Review Commission’s Strategic Plan covering the period FY 2010 - 2015 reflects this objective. 

It also reflects the Review Commission’s overall goal of management excellence. 

Commission Function

The function of the Commissioners is to review and decide cases contested under the Act, 

following an initial decision by an Administrative Law Judge. This higher level of review must 

be prompt, fair, and protective of the parties’ rights, consistent with our overall strategic goals. 

In FY 2012, the Commission had 35 cases pending at the beginning of the year. It received 19 

new cases and resolved 23 cases by year-end. Thus, the Commission entered FY 2013 with 31 

cases pending review. 

The Commission operated with only two Commissioners in FY 2012 due to one Commissioner’s 

term expiring in FY 2011. 
4 

New performance goals have been developed for fiscal years 2010, 2011, and 2012 to support 

the FY 2010 – 2015 Strategic Plan. The following table provides the performance goals and 

results for FY 2008 – FY 2012: 

Outcome 

Goals 

Performance 

Measures 

FY 2008 

Actual 

(Target) 

FY 2009 

Actual 

(Target) 

FY 2010 

Actual 

(Target) 

FY 2011 

Actual 

(Target) 

FY 2012 

Actual 

(Target) 

Reduce the 

length of time 

to resolve 

Commissionlevel cases 

Percent of 

cases over 2 

years old 

disposed of 

at the 

Commission 

level 

23% 

Target not 

met 

(100%) 

18% 

Target not 

met 

(75%) 

New Goal 

developed 

for FY 

2010 

New Goal 

developed 

for FY 2011 

New Goal 

developed 

for FY 

2012 

Reduce the 

length of time 

to resolve 

priority cases 

Percent of 

priority cases 

disposed of 

within 6 

months 

100% 

Target 

met 

(100%) 

100% 

Target 

met 

(100%) 

New Goal 

developed 

for FY 

2010 

New Goal 

developed 

for FY 2011 

New Goal 

developed 

for FY 

2012 

Resolve the 

oldest cases 

on the Review 

Commission’s 

docket. 

All cases 

docketed at 

the 

Commission 

level prior to 

2008 

resolved. 

New Goal 

developed 

to support 

FY 2010 – 

2015 

Strategic 

Plan 

New Goal 

developed 

to support 

FY 2010 – 

2015 

Strategic 

Plan 

20% 

Target not 

met 

(30% of 

oldest 

cases) 

80% 

Target met 

(70% of 

oldest cases) 

Complete

d by end 

of 

 FY 2011 

Reduce the 

average age of 

open cases at 

the 

Commissionlevel.* 

Average age 

of open 

cases. 

New Goal 

developed 

to support 

FY 2010 – 

2015 

Strategic 

Plan 

New Goal 

developed 

to support 

FY 2010 – 

2015 

Strategic 

Plan 

32 Months 

Target met 

(41 

months or 

less) 

15 months 

Target met 

(36 months 

or 

less) 

18 months 

Target 

Met 

(33 

months or 

less) 

Resolve all 

priority cases 

in a timely 

manner. 

Percent of 

priority cases 

disposed of 

within 6 

months. 

New Goal 

developed 

to support 

FY 2010 – 

2015 

Strategic 

Plan 

New Goal 

developed 

to support 

FY 2010 – 

2015 

Strategic 

Plan 

100% 

Target met 

(100%) 

100% 

Target met 

(100%) 

100% 

Target 

Met 

(100%) 

 * As of September 30, 2009, and September 30, 2010, the average (mean) period of time for a case on the 

Review Commission’s docket was 46 months, and 32 months, respectively. The Review Commission’s revised 

Strategic Plan (FY 2010- 2015) anticipated reducing this average to 24 months by the end of FY 2015. 

The Commission met all of its Commission-level case resolution targets in FY 2012. 
5 

The following table summarizes actual Commission case activity for fiscal years 2009, 2010, 

2011, and 2012, and provides estimated case activity for fiscal years 2013 and 2014. 

Commission Case Activity 

FY 2009 

Actual 

FY 2010 

Actual 

FY2011

Actual 

FY 2012 

Actual 

FY 2013 

Estimate 

FY 2014 

Estimate 

New Cases: 

Cases Directed for 

Review: 16 24 24 14 15 20 

Other New Cases: 

 Interlocutory 

 Appeals 0 0 6 2 2 2 

 Remands 6 0 0 3 2 2 

 Other 0 0 0 0 0 0 

 Total Other New 

 Cases: 6 0 6 5 4 4 

Total New Cases: 22 24 30 19 19 24 

Case Inventory 

from Prior Year: 20 22 31 35 31 35 

Total Caseload: 42 46 61 54 50 59 

Dispositions: 20 15 26 23 15 25 

Case Inventory, 

End of Year: 22 31 35 31 35 34 

 

Administrative Law Judge Function

The function of the Review Commission’s Administrative Law Judges is to conduct formal 

hearings and related proceedings in a fair, just, and expeditious manner, consistent with 

OSHRC’s overall strategic goals. 

The Administrative Law Judge function began the fiscal year with 1,345 cases in its inventory 

and received 2,696 new cases during the year, for a total of 4,041 cases. A total of 2,887 cases 

were disposed of, leaving 1,154 cases in the inventory at the end of the fiscal year. 

The following table provides the performance goals and results for this function for FYs 2008-

2012. 

Outcome Goals Performance 

Measures 

FY 2008 

Actual 

(Target) 

FY 2009 

Actual 

(Target) 

FY 2010 

Actual 

(Target) 

FY 2011 

Actual 

(Target) 

FY 2012

Actual 

(Target)

Ensure that a 

significant 

proportion of noncomplex cases at 

the ALJ level are 

Percent 

within one 

year. 

99% 

Target met

(99%) 

98% 

Target met 

(98%) 

98% 

Target 

met 

(98%) 

98% 

Target 

met 

(98%) 

96% 

Target not 

met 

(98%) 
6 

Outcome Goals Performance 

Measures 

FY 2008 

Actual 

(Target) 

FY 2009 

Actual 

(Target) 

FY 2010 

Actual 

(Target) 

FY 2011 

Actual 

(Target) 

FY 2012

Actual 

(Target)

resolved in less 

than one year. 

Ensure that a 

significant 

proportion of 

complex cases at 

the ALJ level are 

resolved in less 

than one year. 

Percent 

within one 

year.* 

99% 

Target met

(99%) 

98% 

Target 

exceeded 

(95%) 

89% 

Target not 

met 

(95%) 

84% 

Target not 

met 

(95%) 

87% 

Target not 

met 

(95%) 

*Note: For FY 2008 – 2009, the target case resolution period for complex cases at the ALJ level was 18 months 

(540 days). In accordance with the Review Commission’s revised Strategic Plan (FY 2010- 2015), the target period 

has been reduced to one year commencing in FY 2010. 

In the last year, the Office of the Chief Administrative Law Judge has operated at less than full 

capacity due to vacancies which have occurred over the past two years. This, along with the 

significant increase in our caseload, has impacted the time to resolve cases. However, as of May 

2012, all the judicial vacancies have been filled and we are now operating with a full 

complement of ALJs. Nevertheless, our end-of-the fiscal year case inventory was 49 percent 

higher than it was in FY 2009. Furthermore, the number of new cases in FY 2012, while lower 

than in FY 2011, was still 31 percent over the level in FY 2009. In addition, this workload 

included a 42% increase in the number of cases disposed of with hearings compared to FY 2009. 

Hearings are necessarily time consuming, and this had an effect on case disposal. 

The following table provides actual Administrative Law Judge workloads for fiscal years 2009, 

2010, 2011, and 2012, and estimated workloads for fiscal years 2013 and 2014. 

FY 2009

Actual

FY 2010

Actual

FY 2011

Actual

FY2012

Actual

FY 2013 

Estimate

FY 2014 

Estimate 

OSHA Inspections*: 40,549 40,942 40,648 40,961 40,100 39,170 

Administrative Law Judge Workload: 

a. Case Inventory, 

Start of Year 739 777 983 1,345 1,154 1,179 

b. New Cases 2,058 2,565 3,175 2,696 2,800 2,800 

c. Total Caseload 2,797 3,342 4,158 4,041 3,954 3,979 

d. Disposals 

(1) With 

 Hearing 

67 107 111 95 110 120 

(2) Without 

Hearing 1,953 2,252 2,702 2,792 2,665 2,655 

e. Total Dispositions 2,020 2,359 2,813 2,887 2,775 2,775 

 

 

Total Case Inventory, 

End of Year 777 983 1,345 1,154 1,179 1,204 

*Provided by Directorate of Evaluation and Analysis, OSHA. 
7 

Office of the Executive Director Function

The Office of the Executive Director provides administrative services to support the Review 

Commission in fulfilling its mission. 

The Executive Director function provides strategic planning and operational management for the 

organization. The Office of the Executive Director also includes: technology management, 

computer and information security, financial, and administrative services. The day-to-day work 

performed under the direction of the Executive Director includes: 

• Supporting the development and implementation of the Agency’s strategic goals; 

• Maintaining and enhancing a website to provide the public with access to Review 

Commission information; 

• Providing agency-wide support in the areas of finance, budget, procurement and contracting, 

human resources, equal opportunity and general administrative services; 

• Providing personnel, payroll, benefits, reproduction, mail services, and travel assistance to 

agency employees; 

• Procuring goods and services, maintenance and needed repairs of equipment, training, 

reference materials, supplies and office space; 

• Implementing case management and administrative systems through information technology 

hardware and software; 

• Developing and maintaining computer systems and information security enhancements; and 

• Enhancing telecommunications and improving technology efficiency and effectiveness. 

The following performance goals have been developed for fiscal years 2011, 2012, 2013, and 

2014 to support the FY 2010 – 2015 Strategic Plan: 

Outcome 

Goals 

Performance 

Measures 

FY 

 2011 

Actual 

(Target) 

FY 

 2012 

Actual 

(Target) 

FY 

2013 

(Target) 

FY 

2014 

(Target) 

Invest in human 

capital by 

increasing staff 

development and 

training 

opportunities 

and increasing 

employees’ 

capabilities and 

potential. 

One percent of basic 

payroll devoted to 

staff training and 

development by FY 

2015, and no fewer 

than 24 hours 

training per staff 

member per year. 

.45% 

Target Partially 

Met 

(.45% of basic 

payroll to training 

and 10 hours) 

 .54% of basic 

payroll to 

training/62% of 

staff had 12 

hours of 

training* 

Target Not Met 

(.55% of basic 

payroll to 

training and 12 

hours) 

(.55 of 

basic payroll 

to training 

and 12 

hours) 

(.55 of basic 

payroll to 

training and 

12 hours) 
8 

Outcome 

Goals 

Performance 

Measures 

FY 

 2011 

Actual 

(Target) 

FY 

 2012 

Actual 

(Target) 

FY 

2013 

(Target) 

FY 

2014 

(Target) 

Examine and 

identify 

contracted 

positions 

appropriate for 

insourcing. 

Percentage of 

positions identified 

appropriate for 

insourcing that are 

insourced 

One position 

identified 

Target Met 

(Positions 

identified) 

One position 

insourced. No 

other position 

eligible. 

Target Met 

(Insource 

position 

identified and 

identify 

additional 

positions to 

insource) 

(Insource 

any 

additional 

positions 

identified) 

(Insource any 

additional 

positions 

identified) 

Use of 360 

degree 

employeesupervisor 

feedback 

mechanisms. 

All supervisors 

subject to 360 degree 

feedback, and 

feedback is used to 

ensure that 

individual and 

organizational 

effectiveness goals 

are being met. 

Feedback 

Instrument 

developed 

Target Met 

(Appropriate 

feedback 

instrument 

developed) 

Feedback 

Instrument used 

to evaluate 

supervisors 

Target Met 

(Feedback 

mechanism used 

to evaluate all 

supervisors) 

(Feedback 

mechanism 

used to 

evaluate all 

supervisors) 

(Feedback 

mechanism 

used to 

evaluate all 

supervisors) 

*$39,589, or .54 percent of basic payroll, was devoted to staff training and development in FY 2012. We were challenged in 

fully meeting this goal due in part to being under a continuing resolution the first quarter of FY 2012, during which spending on 

training was severely constrained. Tracking of the number of hours devoted to employee training was implemented in FY 

2012. Approximately 62 percent of employees received twelve or more hours of training. 

Analysis of Financial Statements 

The Review Commission had biennial audits of its financial statements from 1996 through 2002. 

Consistent with the Accountability of Tax Dollars Act of 2002, OSHRC began annual audits in 

FY 2003. OSHRC has received an “unqualified” opinion for each biennial and annual review 

conducted by an independent auditor. 

Since 2002, the Review Commission has contracted with the Treasury Franchise Fund, 

Administrative Resources Center (Bureau of the Public Debt – BPD), for accounting services. 

The Administrative Resources Center prepared the Review Commission’s FY 2012 financial 

statements, which include comparative data for FY 2011. The principal financial statements 

include the Balance Sheet, Statement of Net Cost, Statement of Changes in Net Position, and 

Statement of Budgetary Resources. 

The changes described in the analyses below generally indicate that the budget execution process 

has become more effective, given improved budget management, higher payroll costs, the costs 
9 

of improving our IT infrastructure, and higher costs for goods and services to maintain 

operations and fulfill our mission.

Analysis of the Balance Sheet 

OSHRC’s assets in fiscal year 2012 were $3,476,133 as of September 30, 2012. This represents 

an increase of $222,377 from fiscal year 2011. The Fund Balance with Treasury of $3,420,650 

represents OSHRC’s largest asset as of September 30, 2012. This is an increase of 

approximately 8 percent from fiscal year 2011 and represents approximately 98 percent of the 

agency’s total assets. General Property, Plant, and Equipment account for approximately 1.60 

percent of OSHRC’s total assets as of September 30, 2012. The net fixed asset value of $55,248 

equals the cost less accumulated depreciation and represents the current book value of those 

assets. 

OSHRC’s liabilities in fiscal year 2012 totaled $1,252,244 as of September 30, 2012. This is a 

decrease of $406 from fiscal year 2011. The accounts payable balance at September 30, 2012, 

was $86,514, a decrease of $94,823 from September 30, 2011. Unfunded annual leave increased 

$23,540 in 2012 from 2011. Unfunded annual leave represents approximately 50 percent of total 

agency liabilities. 

Net Position is the difference between total assets and total liabilities. The total net position for 

fiscal year 2012 increased by $222,783 from fiscal year 2011. 

Analysis of Statement of Net Cost 

The Statement of Net Cost shows the net cost of operations for the agency, and it is broken out 

between OSHRC’s two major programs, Administrative Law Judge and Commission. The Total 

net cost of operations in 2012 was $11,931,704, a decrease of $209,522, or 1.73 percent less than 

the 2011 net cost of operations of $12,141,226 

Analysis of the Statement of Changes in Net Position 

The Statement of Changes in Net Position reports the change in the agency’s net position during 

the reporting period. The net position consists of two components, the unexpended 

appropriations and the cumulative results of operations. The Net Position increased $222,783 in 

2012 from 2011, a change of approximately 11 percent. 

Analysis of the Statement of Budgetary Resources 

The Statement of Budgetary Resources presents how the budgetary resources were made 

available and the status of the budgetary resources at the end of the reporting period. The total 

budgetary resources must always equal the total status of budgetary resources. For fiscal year 

2012, OSHRC had total budgetary resources of $12,710,857, which is $66,211 less than in 2011. 
10 

Management Assurances 

Systems, Controls, and Legal Compliance

The Review Commission is in compliance with the Federal Managers Financial Integrity Act and 

OMB Circular A-123, Management’s Responsibility for Internal Control. The system of internal 

controls for this agency is functioning well. It provides reasonable assurance as to the efficiency 

and effectiveness of programs and operations, reliability of financial and performance 

information, and compliance with laws and regulations. These controls satisfy the requirements 

of the Federal Managers’ Financial Integrity Act. 

The Review Commission is a small agency and does not have a separate Inspector General 

Office. Therefore, the Review Commission’s management team assumes the responsibility for 

assessing the Agency’s internal operations and determining if there are any weaknesses that need 

correction. In FY 2012, two program reviews took place: an audit of FY 2012 financial 

statements, and an audit of computer and information security. 

Financial Audit 

The Review Commission has had annual audits of its financial statements since FY 2003, 

including reviews of the adequacy of the Review Commission’s internal control systems. The 

Review Commission has received an unqualified opinion for each financial audit conducted, 

including FY 2012.

With regard to financial management, the National Finance Center (NFC) provided payroll 

services, and the Bureau of Public Debt (BPD) provided accounting, disbursement, and financial 

statement preparation services for the agency. Accordingly, certain aspects of the Review 

Commission’s financial management system are largely influenced by the practices and 

procedures of the NFC and the BPD. 

In addition to the practices and procedures of the NFC and BPD, the Review Commission has 

established certain internal controls and procedures that safeguard assets and ensure that 

obligations and disbursements are made consistent with management’s direction. For example, 

BPD reports are reviewed and reconciled to assure that the agency’s obligation and disbursement 

actions are properly recorded and that the year-end financial statements are correctly stated. The 

agency’s Budget and Finance Office also prospectively certifies funds availability for all 

obligations and conducts periodic reviews of internal systems including travel, payroll, and 

procurement. 

The financial audit resulted in an “unqualified” opinion with no reported material weaknesses or 

other significant deficiencies. Generally, the system of internal controls for this Agency is 

functioning well. It provides reasonable assurance as to the efficiency and effectiveness of 

programs and operations, reliability of financial and performance information, and compliance 

with laws and regulations. These controls satisfy the requirements of the Federal Managers' 

Financial Integrity Act. As previously mentioned, the Review Commission has had annual 

audits of its financial statements since 2003, including reviews of the adequacy of the Review 

Commission’s internal control systems. The Review Commission has received an unqualified 

opinion for each audit conducted.
11 

The Review Commission contracts with the Treasury Franchise Fund, Administrative Resource 

Center, (Bureau of Public Debt (BPD)), for accounting, disbursement, and travel services and 

with the National Finance Center for payroll and personnel services. In addition to the Agency’s 

internal controls and procedures that safeguard assets and ensure that obligations and 

disbursements are made consistent with management’s direction, the BPD and the National 

Finance Center have established practices and procedures that assure appropriate internal 

controls. The two agencies’ internal control systems are evaluated independently. 

Improper Payments 

The Review Commission did not have any improper payments in FY 2012. Prior to awarding 

procurement actions, the Review Commission matched against the General Services 

Administration (GSA) Excluded Parties List (EPLS) and the Central Contractor Registry (CCR) 

to determine vendor’s eligibility to receive payments. All payments were verified using this 

method with the exception of payments to Federal vendors, payroll and credit card payments. 

In FY 2012, the Review Commission’s “Do Not Pay Implementation Plan” was developed. This 

plan outlines the Agency’s proposed strategy to develop and implement a robust, centralized 

fraud-detection and prevention solution. Specifically, the plan is based on the Agency’s 

systematic review of current pre-payment and pre-award procedures to reduce and eliminate 

improper payments pursuant to Executive Order 13520 dated November 20, 2009. This plan will 

be implemented in FY 2013. 

Computer and Information Security Program 

Since FY 2003, the Review Commission has contracted for annual independent evaluations of its 

computer and information security programs, consistent with the Federal Information Security 

Management Act (December 17, 2002) which was signed into law as part of the E-Government 

Act (Public Law 107-347). These evaluations are conducted under the requirements of the 

Government Information Security Reform Act (the predecessor to Federal Information Security 

Management Act (FISMA)), as well as the Office of Management and Budget’s (OMB) 

implementing guidelines, and National Institute of Standards and Technology (NIST) guidance. 

Our FISMA audits have revealed a weakness in supporting policies. In response, OSHRC has 

upgraded its Certification and Authorization (C&A). OSHRC maintains updated security 

processes, and maintains a system security plan that complies with NIST standards. OSHRC 

tested its continuity of operations plan (COOP) in June 2012 and August 2012 during a 

Department of Homeland Security exercise and is in the process of fine-tuning the plan to fully 

incorporate all newly adopted technologies. 

The executive summary for the current (FY 2012) FISMA Program Review Report reveals that 

the Review Commission continues to take steps to enhance its computer security posture. 

The provisions of the Review Commission’s security policy directive apply to all employees and 

contractors who use our computer and network systems or gain access to our computer generated 

information. 

The agency’s information security program will, at a minimum, continue to implement 

appropriate recommendations made by the independent evaluator; incorporate performance 
12 

measures to ensure that the security plan is practiced throughout the life cycle of the agency’s 

system; establish additional personnel controls for sensitive information; monitor procedures for 

program effectiveness and compliance with security requirements; assure that systems and 

applications operate effectively and provide appropriate confidentiality, integrity and 

availability; and protect information commensurate with the level of risk and magnitude of harm 

resulting from loss, misuse, unauthorized access, or modification.

Performance Data Verification 

For each strategic goal and its related objectives, the Review Commission formulated 

performance measures and numerical annual targets, whenever possible. A few measures are 

necessarily qualitative in nature. Case processing and adjudication measurements are used for 

several objectives contained in our Public Service Goal. Most of the data related to the Public 

Service Goal resides in the Review Commission’s case management/tracking system. In FY 

2012, each of the 2,696 new cases docketed at the Administrative Law Judge level were entered 

into the case management system, and progress on all cases was tracked. In order to assure the 

quality of the data, management periodically reviews the information in the case 

management/tracking system. The agency conducts test runs of the data to ensure that 

information is entered and updated on a timely basis. The reports are used to assess workload 

and make workload adjustments, when necessary. At the end of the year, this data is used by the 

offices to measure performance related to the goals and to improve management. 

Human resource measurements are used for the goals in the Office of the Executive Director 

function. The data related to these goals is maintained and tracked in the Human Resource 

system, which includes spreadsheets to track training costs and hours, employee performance 

files, and personnel files. Management reviews the information to ensure that the information is 

accurate. 

Limitations of the Financial Statements

The principal financial statements have been prepared to report the financial position and results 

of operations of the Review Commission, pursuant to the requirements of 31 U.S.C. 3515(b). 

The statements have been prepared from the books and records of the Review Commission in 

accordance with generally accepted accounting principles (GAAP) for Federal entities and 

formats prescribed by the Office of Management and Budget (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 realization 

that they are for a component of the United States Government, a sovereign entity. 
U.S. OCCUPATIONAL SAFETY & HEALTH 

REVIEW COMMISSION 

INDEPENDENT AUDITOR’S REPORT

AND 

FINANCIAL STATEMENTS 

FOR THE YEARS ENDED 

SEPTEMBER 30, 2012 AND 2011 

 

Prepared By 

Brown & Company CPAs, PLLC 

November 5, 2012 
13 

1101 MERCANTILE LANE, SUITE 122 ● LARGO, MD 20774 

PHONE: (240) 770-4900 ● FAX: (301) 773-2090 ● mail@brownco-cpas.com ● www.brownco-cpas.com

INDEPENDENT AUDITOR'S REPORT ON THE FINANCIAL STATEMENTS 

U.S. Occupational Safety and Health Review Commission 

Washington, D.C. 

We have audited the accompanying balance sheet of the U.S. Occupational Safety and Health Review 

Commission (OSHRC) as of September 30, 2012 and 2011, and the related statements of net cost, 

changes in net position, and budgetary resources, for the years then ended (collectively referred to as the 

financial statements). These financial statements are the responsibility of OSHRC’s management. Our 

responsibility is to express an opinion on these financial statements based on our audits. 

We conducted our audits in accordance with auditing standards generally accepted in the United States of 

America and the standards applicable to financial audits contained in U.S. Government Auditing 

Standards, issued by the Comptroller General of the United States; and, Office of Management and 

Budget (OMB) Bulletin No. 07-04 as amended, Audit Requirements for Federal Financial Statements.

Those standards and OMB Bulletin No. 07-04 as amended, require that we plan and perform the audit to 

obtain reasonable assurance about whether the financial statements are free of material misstatement. An 

audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial 

statements. An audit also includes assessing the accounting principles used and significant estimates 

made by management, as well as evaluating the overall financial statement presentation. We believe that 

our audits provide a reasonable basis for our opinion. 

In our opinion, the financial statements referred to above present fairly, in all material respects, the 

financial position of the OSHRC as of September 30, 2012 and 2011 and its net costs, changes in net 

position, and budgetary resources for the years then ended in conformity with accounting principles 

generally accepted in the United States of America. 

In accordance with U.S. Government Auditing Standards and OMB Bulletin No. 07-04 as amended, we 

have also issued reports dated November 5, 2012 on our consideration of the OSHRC internal control 

over financial reporting and its compliance with provisions of laws and regulations. Those reports are an 

integral part of an audit performed in accordance with U.S. Government Auditing Standards and should 

be read in conjunction with this report in considering the results of our audit. 

Accounting principles generally accepted in the United States of America require that the Management 

Discussion and Analysis (MD&A) be presented to supplement the basic financial statements. Such 

information, although not a part of the basic financial statements, is required by OMB Circular A-136, 

Financial Reporting Requirements, as revised, that considers it to be an essential part of financial 

reporting for placing the basic financial statements in an appropriate operational, economic, or historical 

context. We have applied certain limited procedures to the required supplementary information in 

accordance with auditing standards generally accepted in the United States of America, which consisted 

of inquiries of management about the methods of preparing the information and comparing the 

information for consistency with management's responses to our inquiries, the basic financial statements, 

and other knowledge we obtained during our audit of the basic financial statements. We do not express an 

opinion or provide any assurance on the information because the limited procedures do not provide us 

with sufficient evidence to express an opinion or provide any assurance. 
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FINANCIAL STATEMENTS AND NOTES 
The accompanying notes are an integral part of these financial statements. 

17 

2012 2011

Assets :

Intragovernmental

Fund Balance With Treasury (Note 2) 3,420,650 $ 3,158,051 $ 

Accounts Receivable (Note 3) - 13,719 

Total Intragovernmental 3,420,650 3,171,770 

Accounts Receivable, Net (Note 3) (96) 6,438 

Property, Equipment, and Software, Net (Note 4) 55,248 75,548 

Other - 331 

Total Assets 3,476,133 $ 3,253,756 $ 

Liabilities:

Intragovernmental

Accounts Payable 28,696 $ 3,696 $ 

Other (Note 6) 88,838 80,499 

Total Intragovernmental 117,534 84,195 

Accounts Payable 86,514 181,337 

Other (Note 6) 1,048,196 987,118 

Total Liabilities 1,252,244 $ 1,252,650 $ 

Commitments and Contingencies 

Net Position:

Unexpended Appropriations - Other Funds 2,794,929 2,526,322 

Cumulative Results of Operations - Other Funds (571,040) (525,216) 

Total Net Position 2,223,889 $ 2,001,106 $ 

Total Liabilities and Net Position 3,476,133 $ 3,253,756 $ 

OCCUPATIONAL HEALTH AND SAFETY REVIEW COMMISSION

BALANCE SHEET

AS OF SEPTEMBER 30, 2012 AND 2011

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

18 

2012 2011

Program Costs:

Administrative Law Judge (Note 8) 5,393,130 $ 5,299,556 $ 

Less: Earned Revenue - (5,981) 

Net Program Costs 5,393,130 $ 5,293,575 $ 

Commission (Note 8) 6,538,574 $ 6,855,389 $ 

Less: Earned Revenue - (7,738) 

Net Program Costs 6,538,574 $ 6,847,651 $ 

Net Cost of Operations 11,931,704 $ 12,141,226 $ 

OCCUPATIONAL HEALTH AND SAFETY REVIEW COMMISSION

STATEMENT OF NET COST

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2012 AND 2011

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

19 

2012 2011

Consolidated Total Consolidated Total

Cumulative Results of Operations:

Beginning Balances (525,216) $ (651,326) $ 

Budgetary Financing Sources:

Other Adjustments - - 

Appropriations Used 11,225,366 11,519,037 

Other Financing Sources (Non-Exchange):

Imputed Financing Sources (Note 9) 660,514 748,299 

Total Financing Sources 11,885,880 12,267,336 

Net Cost of Operations (11,931,704) (12,141,226) 

Net Change (45,824) 126,110 

Cumulative Results of Operations (571,040) $ (525,216) $ 

Unexpended Appropriations:

Beginning Balances 2,526,321 $ 2,582,875 $ 

Budgetary Financing Sources:

Appropriations Received 11,689,000 11,712,000 

Other Adjustments (195,026) (249,516) 

Appropriations Used (11,225,366) (11,519,037) 

Total Budgetary Financing Sources 268,608 (56,553) 

Total Unexpended Appropriations 2,794,929 $ 2,526,322 $ 

Net Position 2,223,889 $ 2,001,106 $ 

OCCUPATIONAL HEALTH AND SAFETY REVIEW COMMISSION

STATEMENT OF CHANGES IN NET POSITION

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2012 AND 2011

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

20 

2012 2011

Budgetary Resources:

Unobligated Balance Brought Forward, October 1 1,185,633 $ 1,192,210 $ 

Adjustment to Unobligated Balance Brought Forward, October 1 - - 

 Unobligated Balance Brought Forward, October 1, as adjusted 1,185,633 1,192,210 

Recoveries of Prior Year Unpaid Obligations 31,250 108,655 

Other changes in unobligated balance (172,934) (226,092) 

Unobligated balance from prior year budget authority, net 1, 1,074,773 043,949 

Appropriations 11,666,908.00 11,688,576.00 

Borrowing authority - - 

Contract Authority - - 

Spending authority from offsetting collections - 13,719.00 

Total Budgetary Resources 12,710,857 $ 12,777,068 $ 

Status of Budgetary Resources:

Obligations Incurred (Note X) 11,488,109 11,591,435 

Unobligated balance, end of year:

 Apportioned 213,987 $ 246,666 $ 

 Exempt from apportionment - $ - $ 

 Unapportioned 1,008,761 $ 938,967 $ 

Total unobligated balance, end of year 1,222,748 1,185,633 

Total Budgetary Resources 12,710,857 $ 12,777,068 $ 

Change in Obligated Balance:

Unpaid Obligations, Brought Forward, October 1 1,986,137 1,997,131 

Uncollected customer payments from Federal sources, brought forward, October 1 (13,719) - 

 Obligated balance, start of year 1,972,418 1,997,131 

Adjustment to obligated balance, start of year (2,197,903) (1,972,418) 

Obligated balance, start of year, as adjusted (225,485) 24,713 

Obligations Incurred 11,488,109 11,591,435 

Outlays (gross) (11,245,093) (11,493,774) 

Change in uncollected customer payments from Federal Sources 13,719 (13,719) 

Recoveries of Prior Year Unpaid (31,250) (108,655) 

Obligated balance, end of year

 Unpaid obligations, end of year 2,197,903 1,986,137 

Obligated balance, end of year 2,197,903 1,972,418 

Budget Authority and Outlays, Net:

Budget authority, gross 11,666,908 $ 11,702,295 $ 

Actual offsetting collections (13,719) - 

Change in uncollected customer payments from Federal sources 13,719 (13,719) 

Budget Authority, net 11,666,908 $ 11,688,576 $ 

Outlays, gross 11,245,093 11,493,774 

Actual offsetting collections (13,719) 

Outlays, net $ 11,493,774 11,231,374 $ 

Distributed Offsetting Receipts (2, (177,255) 401) 

Agency outlays, net 11,228,973 11,316,519 

OCCUPATIONAL HEALTH AND SAFETY REVIEW COMMISSION

STATEMENT OF BUDGETARY RESOURCES

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2012 AND 2011

(In Dollars)
The accompanying notes are an integral part of these financial statements. 

21 

2012 2011

Revenue Activity:

Sources of Cash Collections:

Miscellaneous 2,401 $ 177,255 $ 

Total Cash Collections 2,401 177,255 

Disposition of Collections:

Transferred to Others (by Recipient) 2,401 177,255 

Net Custodial Activity - $ - $ 

OCCUPATIONAL HEALTH AND SAFETY REVIEW COMMISSION

STATEMENT OF CUSTODIAL ACTIVITY

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2012 AND 2011

(In Dollars)
U.S. OCCUPATIONAL SAFETY & HEALTH REVIEW 

COMMISSION 

 NOTES TO THE FINANCIAL STATEMENTS 

22 

NOTE 1. SUMMARY OF SIGNIFICANT 

ACCOUNTING POLICIES 

A. Reporting Entity 

The Occupational Safety and Health Review 

Commission (The Review Commission) is an 

independent, adjudicatory agency created by 

the Occupational Safety and Health Act 

(OSHA) of 1970. Its sole statutory mandate is 

to serve as an administrative court providing 

just and expeditious resolution of disputes 

involving OSHA, employers charged with 

violations of Federal safety and health 

standards, and employees and/or their 

representatives. The Review Commission was 

created by Congress as an agency completely 

independent of the Department of Labor to 

ensure that OSHA’s enforcement actions are 

carried out in accordance with the law and that 

all parties are treated consistent with due 

process should a dispute arise. 

The Review Commission reporting entity is 

comprised of General Funds and General 

Miscellaneous Receipts. 

General Funds are accounts used to record 

financial transactions arising under 

congressional appropriations or other 

authorizations to spend general revenues. 

General Fund Miscellaneous Receipts are 

accounts established for receipts of nonrecurring activity, such as miscellaneous 

receipts for services and benefits. 

The Review Commission receives custodial 

collections and holds custodial receivables that 

are non-entity assets and are transferred to 

Treasury at fiscal year end. 

B. Basis of Presentation 

The financial statements have been prepared to 

report the financial position and results of 

operations of the Review Commission. The 

Balance Sheet presents the financial position 

of the agency. The Statement of Net Cost 

presents the agency’s operating results; the 

Statement of Changes in Net Position displays 

the changes in the agency’s equity accounts. 

The Statement of Budgetary Resources 

presents the sources, status, and uses of the 

agency’s resources and follow the rules for the 

Budget of the United States Government.

The statements are a requirement of the Chief 

Financial Officers Act of 1990, the 

Government Management Reform Act of 1994 

and the Accountability of Tax Dollars Act of 

2002. They have been prepared from, and are 

fully supported by, the books and records of 

the Review Commission in accordance with 

the hierarchy of accounting principles 

generally accepted in the United States of 

America, standards issued by the Federal 

Accounting Standards Advisory Board 

(FASAB), Office of Management and Budget 

(OMB) Circular A-136, Financial Reporting 

Requirements, as amended, and the Review 

Commission’s accounting policies which are 

summarized in this note. These statements, 

with the exception of the Statement of 

Budgetary Resources, are different from 

financial management reports, which are also 

prepared pursuant to OMB directives that are 

used to monitor and control the Review 

Commission’s use of budgetary resources. 

The financial statements and associated notes 

are presented on a comparative basis. Unless 

specified otherwise, all amounts are presented 

in dollars. 
23 

C. Basis of Accounting 

Transactions are recorded on both an accrual 

accounting basis and a budgetary 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. Budgetary 

accounting facilitates compliance with legal 

requirements on the use of federal funds. 

D. Fund Balance with Treasury 

Fund Balance with Treasury is the aggregate 

amount of the Review Commission’s funds 

with Treasury in expenditure, receipt, and 

deposit fund accounts. Appropriated funds 

recorded in expenditure accounts are available 

to pay current liabilities and finance authorized 

purchases. 

The Review Commission does not maintain 

bank accounts of its own, has no disbursing 

authority, and does not maintain cash held 

outside of Treasury. Treasury disburses funds 

for the agency on demand. 

E. Accounts Receivable 

Accounts receivable consists of amounts owed 

to the Review Commission by other Federal 

agencies and the general public. Amounts due 

from Federal agencies are considered fully 

collectible. Accounts receivable from the 

public include reimbursements from 

employees. An allowance for uncollectible 

accounts receivable from the public is 

established when, based upon a review of 

outstanding accounts and the failure of all 

collection efforts, management determines that 

collection is unlikely to occur considering the 

debtor’s ability to pay. 

F. Property, Equipment, and Software 

Property, equipment and software represent 

furniture, fixtures, equipment, and information 

technology hardware and software which are 

recorded at original acquisition cost and are 

depreciated or amortized using the straight-line 

method over their estimated useful lives. 

Major alterations and renovations are 

capitalized, while maintenance and repair costs 

are expensed as incurred. The Review 

Commission’s capitalization threshold is 

$50,000 for individual purchases and $500,000 

for bulk purchases. Property, equipment, and 

software acquisitions that do not meet the 

capitalization criteria are expensed upon 

receipt. Applicable standard governmental 

guidelines regulate the disposal and 

convertibility of agency property, equipment, 

and software. The useful life classifications 

for capitalized assets are as follows: 

Description Useful Life (years) 

Office Furniture 7 

Office Equipment 5 

G. Advances and Prepaid Charges 

Advance payments are generally prohibited by 

law. There are some exceptions, such as 

reimbursable agreements, subscriptions and 

payments to contractors and employees. 

Payments made in advance of the receipt of 

goods and services are recorded as advances or 

prepaid charges at the time of prepayment and 

recognized as expenses when the related goods 

and services are received. 

H. Liabilities 

Liabilities represent the amount of funds likely 

to be paid by the Review Commission as a 

result of transactions or events that have 

already occurred. 

The Review Commission reports its liabilities 

under two categories, Intragovernmental and 

With the Public. Intragovernmental liabilities 

represent funds owed to another government 

agency. Liabilities With the Public represents 

funds owed to any entity or person that is not a 

federal agency, including private sector firms 

and federal employees. Each of these 

categories may include liabilities that are 

covered by budgetary resources and liabilities 

not covered by budgetary resources. 
24 

Liabilities covered by budgetary resources are 

liabilities funded by a current appropriation or 

other funding source. These consist of 

accounts payable and accrued payroll and 

benefits. Accounts payable represent amounts 

owed to another entity for goods ordered and 

received and for services rendered except for 

employees. Accrued payroll and benefits 

represent payroll costs earned by employees 

during the fiscal year which are not paid until 

the next fiscal year. 

Liabilities not covered by budgetary resources 

are liabilities that are not funded by any 

current appropriation or other funding source. 

These liabilities consist of accrued annual 

leave and Unemployement Insurance. 

I. Annual, Sick, and Other Leave 

Annual leave is accrued as it is earned, and the 

accrual is reduced as leave is taken. The 

balance in the accrued leave account is 

adjusted to reflect current pay rates. Liabilities 

associated with other types of vested leave, 

including compensatory, restored leave, and 

sick leave in certain circumstances, are accrued 

at year-end, based on latest pay rates and 

unused hours of leave. Funding will be 

obtained from future financing sources to the 

extent that current or prior year appropriations 

are not available to fund annual and other 

types of vested leave earned but not taken. 

Nonvested leave is expensed when used. Any 

liability for sick leave that is accrued but not 

taken by a Civil Service Retirement System 

(CSRS)-covered employee is transferred to the 

Office of Personnel Management (OPM) upon 

the retirement of that individual. Credit is 

given for sick leave balances in the 

computation of annuities upon the retirement 

of Federal Employees Retirement System 

(FERS)-covered employees effective at 50% 

beginning FY 2010 and 100% in 2014. 

J. Accrued and Actuarial Workers’ 

Compensation 

The Federal Employees' Compensation Act 

(FECA) administered by the U.S. Department 

of Labor (DOL) addresses all claims brought 

by the Review Commission’s employees for 

on-the-job injuries. The DOL bills each 

agency annually as its claims are paid, but 

payment of these bills is deferred for two years 

to allow for funding through the budget 

process. Similarly, employees that the Review 

Commission terminates without cause may 

receive unemployment compensation benefits 

under the unemployment insurance program 

also administered by the DOL, which bills 

each agency quarterly for paid claims. Future 

appropriations will be used for the 

reimbursement to DOL. The liability consists 

of (1) the net present value of estimated future 

payments calculated by the DOL and (2) the 

unreimbursed cost paid by DOL for 

compensation to recipients under the FECA. 

K. Retirement Plans

The Review Commission employees 

participate in either the CSRS or the FERS. 

The employees who participate in CSRS are 

beneficiaries of the Review Commission’s 

matching contribution, equal to seven percent 

of pay, distributed to their annuity account in 

the Civil Service Retirement and Disability 

Fund. 

Prior to December 31, 1983, all employees 

were covered under the CSRS program. From 

January 1, 1984 through December 31, 1986, 

employees had the option of remaining under 

CSRS or joining FERS and Social Security. 

Employees hired as of January 1, 1987 are 

automatically covered by the FERS program. 

Both CSRS and FERS employees may 

participate in the federal Thrift Savings Plan 

(TSP). FERS employees receive an automatic 

agency contribution equal to one percent of 

pay and the Review Commission matches any 

employee contribution up to an additional four 

percent of pay. For FERS participants, the 

Review Commission also contributes the 

employer’s matching share of Social Security. 

FERS employees and certain CSRS 

reinstatement employees are eligible to 

participate in the Social Security program after 

retirement. In these instances, the Review 
25 

Commission remits the employer’s share of the 

required contribution. 

The Review Commission recognizes the 

imputed cost of pension and other retirement 

benefits during the employees’ active years of 

service. OPM actuaries determine pension 

cost factors by calculating the value of pension 

benefits expected to be paid in the future and 

communicate these factors to the Review 

Commission for current period expense 

reporting. OPM also provides information 

regarding the full cost of health and life 

insurance benefits. The Review Commission 

recognized the offsetting revenue as imputed 

financing sources to the extent these expenses 

will be paid by OPM. 

The Review Commission does not report on its 

financial statements information pertaining to 

the retirement plans covering its employees. 

Reporting amounts such as plan assets, 

accumulated plan benefits, and related 

unfunded liabilities, if any, is the responsibility 

of the OPM, as the administrator. 

L. Other Post-Employment Benefits 

The Review Commission employees eligible to 

participate in the Federal Employees' Health 

Benefits Plan (FEHBP) and the Federal 

Employees' Group Life Insurance Program 

(FEGLIP) may continue to participate in these 

programs after their retirement. The OPM has 

provided the Review Commission with certain 

cost factors that estimate the true cost of 

providing the post-retirement benefit to current 

employees. The Review Commission 

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 

Review Commission through the recognition 

of an imputed financing source. 

M. Use of Estimates 

The preparation of the accompanying financial 

statements in accordance with generally 

accepted accounting principles requires 

management to make certain estimates and 

assumptions that affect the reported amounts 

of assets, liabilities, revenues, and expenses. 

Actual results could differ from those 

estimates. 

N. Imputed Costs/Financing Sources 

Federal Government entities often receive 

goods and services from other Federal 

Government entities without reimbursing the 

providing entity for all the related costs. In 

addition, Federal Government entities also 

incur costs that are paid in total or in part by 

other entities. An imputed financing source is 

recognized by the receiving entity for costs 

that are paid by other entities. The Review 

Commission recognized imputed costs and 

financing sources in fiscal years 2012 and 

2011 to the extent directed by accounting 

standards 

O. Reclassification 

Certain fiscal year 2011 balances have been 

reclassified, retitled, or combined with other 

financial statement line items for consistency 

with the current year presentation. 
26 

NOTE 2. FUND BALANCE WITH TREASURY

Fund balance with Treasury account balances as of September 30, 2012 and 2011 were as 

follows: 

The available unobligated fund balances represent the current-period amount available for 

obligation or commitment. At the start of the next fiscal year, this amount will become part of the 

unavailable balance as described in the following paragraph. 

The unavailable unobligated fund balances represent the amount of appropriations for which the 

period of availability for obligation has expired. These balances are available for upward 

adjustments of obligations incurred only during the period for which the appropriation was 

available for obligation or for paying claims attributable to the appropriations. 

The obligated balance not yet disbursed includes accounts payable, accrued expenses, and 

undelivered orders that have reduced unexpended appropriations but have not yet decreased the 

cash balance on hand (see also Undelivered Orders at the End of the Period, Note 13). 

No discrepancies exist between the Fund Balance reflected on the Balance Sheet and the balances 

in the Treasury accounts. 

NOTE 3. ACCOUNTS RECEIVABLE 

Accounts receivable balances as of September 30, 2012 and 2011 were as follows:

Historical experience has indicated that most of the receivables are collectible. There are no 

material uncollectible accounts as of September 30, 2012 and 2011. 

2012 2011

Fund Balances:

Appropriated Funds $ 3,420,650 $ 3,158,051 

Total $ 3,420,650 $ 3,158,051 

Status of Fund Balance with Treasury:

Unobligated Balance

 Available $ 213,987 $ 246,666 

 Unavailable 1,008,761 938,967 

Obligated Balance Not Yet Disbursed 2,197,902 1,972,418 

Total $ 3,420,650 $ 3,158,051 

2012 2011

Intragovernmental

Accounts Receivable - $ 13,719 $ 

Total Intragovernmental Accounts Receivable $ 13,719 - $ 

With the Public

Accounts Receivable (96) $ 6,438 $ 

Total Public Accounts Receivable (96) $ 6,438 $ 

Total Accounts Receivable $ 20,157 (96) $ 
27 

NOTE 4. PROPERTY, EQUIPMENT, AND SOFTWARE 

Schedule of Property, Equipment, and Software as of September 30, 2012 

Schedule of Property, Equipment, and Software as of September 30, 2011 

NOTE 5. OTHER ASSETS 

Other asset account balances as of September 30, 2012 and 2011, were as follows: 

The 2012 balance consists of a one time travel advance. 

NOTE 6. LIABILITIES NOT COVERED BY BUDGETARY RESOURCES 

The liabilities for The Review Commission as of September 30, 2012 and 2011, include liabilities 

not covered by budgetary resources. Congressional action is needed before budgetary resources 

can be provided. Although future appropriations to fund these liabilities are likely and 

anticipated, it is not certain that appropriations will be enacted to fund these liabilities. 

Unemployment Insurance liabilities represent the unfunded liability for actual unemployment 

benefits paid on The Review Commission's behalf and payable to the DOL. 

Major Class

Acquisition 

Cost

Accumulated 

Amortization/

Depreciation

Net Book 

Value

Furniture & Equipment 441,237 $ 385,989 $ 55,248 $ 

Total 441,237 $ 385,989 $ 55,248 $ 

Major Class

Acquisition 

Cost

Accumulated 

Amortization/

Depreciation

Net Book 

Value

Furniture & Equipment 441,237 $ 365,689 $ 75,548 $ 

Total 441,237 $ 365,689 $ 75,548 $ 

2012 2011

With the Public

Advances and Prepayments 331 $ - $ 

Total Public Other Assets 331 $ - $ 

2012 2011

Intragovernmental – Unemployment Insurance - $ 4,550 $ 

Unfunded Leave 626,192 602,652 

Total Liabilities Not Covered by Budgetary Resources 626,192 $ 607,202 $ 

Total Liabilities Covered by Budgetary Resources 626,052 645,448 

Total Liabilities 1,252,244 $ 1,252,650 $ 
28 

Unfunded leave represents a liability for earned leave and is reduced when leave is taken. The 

balance in the accrued annual leave account is reviewed quarterly and adjusted as needed to 

accurately reflect the liability at current pay rates and leave balances. Accrued annual leave is 

paid from future funding sources and, accordingly, is reflected as a liability not covered by 

budgetary resources. Sick and other leave is expensed as taken. 

NOTE 7. OTHER LIABILITIES 

NOTE 8. OPERATING LEASES 

The Review Commission occupies office space under a lease agreements that are accounted for as 

operating leases. Annual rent for each location is charged by the General Services 

Administration (GSA), which acts as the leasing agent for The Review Commission. There is not 

a lease contract in place beyond April 2013, for the Washington D.C office, however the intent is 

to renew the agreement. The lease locations and terms are listed below: 

Lease payments are increased annually based on the adjustments for operating cost and real estate 

tax escalations. Below is a schedule of future payments for the term of the lease. 

Current Year: 2012

Current

Intragovernmental

Payroll Taxes Payable 88,838 $ 

Total Intragovernmental Other Liabilities 88,838 $ 

With the Public

 Payroll Taxes Payable 12,708 $ 

 Accrued Funded Payroll and Leave 409,296 

 Unfunded Leave 626,192 

Total Public Other Liabilities 1,048,196 $ 

Prior Year: 2011

Current

Intragovernmental

Unemployment Insurance Liability 4,550 $ 

Payroll Taxes Payable 75,949 

Total Intragovernmental Other Liabilities 80,499 $ 

With the Public

 Payroll Taxes Payable 11,014 $ 

 Accrued Funded Payroll and Leave 373,452 

 Unfunded Leave 602,652 

Total Public Other Liabilities 987,118 $ 

Location Term Lease Expiration Date

Washington DC 60 months 04/23/2013

Atlanta, GA 59 months 01/31/2014

Denver, CO 120 months 09/30/2018
29 

The operating lease amount does not include estimated payments for leases with annual renewal 

options. 

NOTE 9. INTRAGOVERNMENTAL COSTS AND EXCHANGE REVENUE 

Intragovernmental costs and revenue represent exchange transactions between The Review 

Commission and other federal government entities, and are in contrast to those with non-federal 

entities (the public). Such costs and revenue are summarized as follows: 

NOTE 10. IMPUTED FINANCING SOURCES 

The Review Commission recognizes as imputed financing the amount of accrued pension and 

post-retirement benefit expenses for current employees. The assets and liabilities associated with 

such benefits are the responsibility of the administering agency, OPM. For the fiscal years ended 

September 30, 2012 and 2011, respectively, imputed financing was as follows. 

Fiscal Year Building

2013 $ 849,493 

2014 124,520 

2015 95,770 

2016 96,604 

2017 97,457 

Thereafter 98,330 

Total Future Payments $ 1,362,174 

2012 2011

Administrative Law Judge

 Intragovernmental Costs 1,748,031 $ 1,784,469 $ 

 Public Costs 3,645,099 3,515,087 

 Total Program Costs 5,393,130 5,299,556 

 Intragovernmental Earned Revenue - (5,981) 

 Net Program Costs 5,393,130 $ 5,293,575 $ 

Commission

 Intragovernmental Costs 2,119,294 $ 2,308,350 $ 

 Public Costs 4,419,280 4,547,039 

 Total Program Costs 6,538,574 6,855,389 

 Intragovernmental Earned Revenue - (7,738) 

 Net Program Costs 6,538,574 $ 6,847,651 $ 

Total Intragovernmental costs 3,867,325 $ 4,092,819 $ 

Total Public costs 8,064,379 8,062,126 

 Total Costs 11,931,704 12,154,945 

 Total Intragovernmental Earned Revenue (13,719) 

Total Net Cost 11,931,704 $ 12,141,226 $ 

2012 2011

Office of Personnel Management $ 660,514 $ 748,299 

Total Imputed Financing Sources $ 660,514 $ 748,299 
30 

NOTE 11. BUDGETARY RESOURCE COMPARISONS TO THE BUDGET OF THE 

UNITED STATES GOVERNMENT 

The President’s Budget that will include fiscal year 2012 actual budgetary execution information 

has not yet been published. The President’s Budget is scheduled for publication in February 2013 

and can be found at the OMB Web site: http://www.whitehouse.gov/omb/. The 2013 Budget of 

the United States Government, with the "Actual" column completed for 2011, has been 

reconciled to the Statement of Budgetary Resources and there were no material differences. 

NOTE 12. APPORTIONMENT CATEGORIES OF OBLIGATIONS INCURRED 

Obligations incurred and reported in the Statement of Budgetary Resources in 2012 and 2011 

consisted of the following: 

Category A apportionments distribute budgetary resources by fiscal quarters. 

NOTE 13. UNDELIVERED ORDERS AT THE END OF THE PERIOD 

For the fiscal years ended September 30, 2012 and 2011, budgetary resources obligated for 

undelivered orders amounted to $1,571,852 and $1,340,688, respectively. 

NOTE 14. CUSTODIAL ACTIVITY 

The Review Commission is an administrative agency collecting for the General Fund. The 

Review Commission reports cash collections and refunds as custodial activity. The type of cash 

collected primarily consists of Freedom of Information Act fees. However, during fiscal year 

2011, The Review Commission received a large custodial receipt for a refund of tenant 

improvement allowance. While these collections are considered custodial, they are neither 

primary to the mission of The Review Commission nor material to the overall financial 

statements. The Review Commission's total custodial collections are $2,401 and $177,255 for the 

fiscal years ended September 30, 2012, and 2011, respectively. 

 

2012 2011

Direct Obligations, Category A 11,488,109 $ 11,577,716 $ 

Reimbursable Obligations, Category A - 13,719 

Total Obligations Incurred 11,488,109 $ 11,591,435 $ 
31 

NOTE 15. RECONCILIATION OF NET COST OF OPERATIONS TO BUDGET 

The Review Commission has reconciled its budgetary obligations and non-budgetary resources 

available to its net cost of operations. 

2012 2011

Resources Used to Finance Activities:

Budgetary Resources Obligated

Obligations Incurred 11,488,109 $ 11,591,435 $ 

Spending Authority From Offsetting Collections and Recoveries (31,250) (122,374) 

Offsetting Receipts (2,401) (177,255) 

Net Obligations 11,454,458 11,291,806 

Other Resources

Imputed Financing From Costs Absorbed By Others 660,514 748,299 

Net Other Resources Used to Finance Activities 660,514 748,299 

Total Resources Used to Finance Activities 12,114,972 12,040,105 

Resources Used to Finance Items Not Part of the Net Cost of Operations (227,108) 52,417 

Total Resources Used to Finance the Net Cost of Operations 11,887,864 12,092,522 

Components of the Net Cost of Operations That Will Not Require or

Generate Resources in the Current Period: 43,840 48,704 

Net Cost of Operations 11,931,704 $ 12,141,226 $