AGENCY 

FINANCIAL 

REPORT

2023

USDA | 2023 Agency Financial Report i

Non-Discrimination Statement

In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA or the 

Department) civil rights regulations and policies, USDA, its Mission Areas, agencies, staff offices, 

employees, and institutions participating in or administering USDA programs are prohibited from 

discriminating based on race, color, national origin, religion, sex, gender identity (including gender 

expression), sexual orientation, disability, age, marital status, family/parental status, income derived 

from a public assistance program, political beliefs, or reprisal or retaliation for prior civil rights 

activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). 

Remedies and complaint filing deadlines vary by program or incident. 

Program information may be made available in languages other than English. Persons with disabilities 

who require alternative means of communication to obtain program information (e.g., Braille, large 

print, audiotape, or American Sign Language) should contact the responsible Mission Area, agency, 

or staff office - the USDA TARGET Center at (202) 720-2600 (voice and TTY).

To file a program discrimination complaint, a complainant should complete a Form AD-3027, USDA 

Program Discrimination Complaint Form, which can be obtained online from any USDA office, by 

calling (866) 632-9992, or by writing a letter addressed to USDA. The letter must contain the 

complainant’s name, address, telephone number, and a written description of the alleged discriminatory 

action in sufficient detail to inform the Assistant Secretary for Civil Rights about the nature and date of 

an alleged civil rights violation. The completed Form AD-3027 or letter must be signed and submitted 

to USDA by: 

(1) Mail: 

U.S. Department of Agriculture 

Executive Director

Office of the Assistant Secretary for Civil Rights 

Center for Civil Rights Enforcement

1400 Independence Avenue, SW

Mail Stop 9430

Washington, D.C. 20250-9410, or

(2) Efax: 

(833) 256-1665, or

(3) Email:

ProgramComplaints@usda.gov

Please attach a signed AD-3027 

complaint form or letter to the email.

USDA | 2023 Agency Financial Report iii

Table of Contents

Message from Secretary Vilsack.............................................................................. 1

Section I Management’s Discussion and Analysis................................................ 5

Organization Chart ............................................................................................................. 6

Mission Areas and Staff Offices.......................................................................................... 7

Program Performance .......................................................................................................10

Analysis of Systems, Control, and Legal Compliance........................................................13

Statement of Assurance ................................................................................................13

Federal Managers’ Financial Integrity Act Report on Management Control....................14

Federal Financial Management Improvement Act Report on 

Financial Management Systems....................................................................................17

Compliance with Laws and Regulations ........................................................................19

Financial Management Systems Strategy......................................................................21

Analysis of Financial Statements.......................................................................................29

Forward Looking Information.............................................................................................35

Section II Financial Information ............................................................................. 39

Message from the Office of the Chief Financial Officer.....................................................40

Independent Auditors Report.............................................................................................42

Financial Statements.........................................................................................................59

Notes to the Financial Statements.....................................................................................64

Required Supplementary Information ..............................................................................146

Section III Other Information ................................................................................ 159

Summary of Financial Statement Audit and Management Assurances ............................160

Management Challenges ................................................................................................162

Payment Integrity ............................................................................................................198

Civil Monetary Penalty Adjustment for Inflation................................................................218

Grants Programs.............................................................................................................233

Climate-Related Financial Risk........................................................................................234

Agency Audits Resolution Report ....................................................................................235

Abbreviations— Acronyms................................................................................... 246
iv Table of Contents
USDA | 2023 Agency Financial Report 1

Message from 

Secretary Vilsack

Attached you will find the U.S. Department of Agriculture’s Agency 

Financial Report for Fiscal Year 2023, which covers a pivotal year 

characterized by recovery, growth, and the unveiling of new economic 

opportunities for our citizens. The dedicated public servants of the U.S. 

Department of Agriculture (USDA), in collaboration with our many 

external partners, have been a driving force behind building an economy 

that thrives from the middle out and bottom up. 

Our focus has been particularly sharp on invigorating rural America, creating new opportunities for 

small- and mid-size farmers, who are the backbone of our agricultural community. USDA, called 

the People’s Department by President Lincoln, also serves every American, in every zip code, every 

day. This work relies on a strong operational foundation, whether to ensure nutrition security, fair 

and competitive markets for farmers, climate-smart agriculture, a strong bioeconomy, thriving 

community infrastructure, or equitable access for all who seek to participate in our programs and in 

agriculture. This report demonstrates significant successes within USDA and for our stakeholders. 

As a result of the work of the Biden-Harris Administration and Congress passing the American 

Rescue Plan, the Bipartisan Infrastructure Law, and the Inflation Reduction Act, along with the use 

of the Commodity Credit Corporation, USDA has invested in a system that works for farming, 

ranching, and forestry operations of all sizes; expands opportunity for underserved and minority 

farmers; puts nutritious food on the dinner table; reduces carbon output that causes climate change; 

and gives families and businesses in rural areas the tools they need to create a good life in the 

communities they love.

For example, with the backing of President Biden's Inflation Reduction Act, the USDA has been 

empowered to address the climate crisis with renewed vigor. Thanks to historic investments in 

FY2023 in voluntary conservation programs, USDA was able to enroll more farmers and more acres 

in conservation than at any other point in history. We also made the largest investment in rural 

electrification efforts since the Roosevelt Administration, with nearly $10 billion put towards the 

Empowering Rural America (“New ERA”) and Powering Affordable Clean Energy (PACE) 

programs that will help communities invest in clean energy infrastructure that is also affordable for 

rural customers. 

Through the Inflation Reduction Act and Bipartisan Infrastructure Law, we also were able to direct 

over $1.2 billion in FY 2023 towards mitigating wildfire risks across the West. Our efforts have 

been multifaceted, from boosting our Community Wildfire Defense Grants with nearly $200 million 
2 Message from the Secretary

awarded to help communities across 22 states and seven tribes boost their resiliency to wildfires, to 

setting a record for hazardous fuels mitigation, at 4.3 million acres treated, that represents our 

unprecedented level of commitment to protect communities, watersheds, and critical infrastructure 

from wildfire. 

Our endeavors also extend to bolstering local and regional food systems while leveling the playing 

field for small- and mid-sized producers. We've channeled over $75 million to enhance organic 

markets and support producers transitioning to organic farming. Investments to expand independent 

processing through programs like the Food Supply Chain Guaranteed Loan, Meat and Poultry 

Intermediary Lending, and Business and Industry Loan Guarantee have surpassed $320 million. 

Furthermore, our ReConnect program, fortified with an investment of over $700 million, is bridging 

the digital divide for hundreds of thousands rural Americans, including those in the hardest to reach 

communities.

All the while, our commitment to fostering diversity, equity, inclusion, and accessibility remains 

unwavering. The independent Equity Commission, created under the American Rescue Plan, has 

been pivotal in providing recommendations to enhance inclusivity. In parallel, USDA invested 

$262.5 million in the NextGen program, providing grants to minority serving institutions with the 

goal of developing a new generation of agricultural leaders. 

Our mission to end food and nutrition insecurity has also been front and center. Initiatives like our 

Healthy Meals Initiative have been strengthened with nearly $30 million, benefiting small and rural 

school districts. The Biden-Harris administration's allocation of $2.7 billion has further fortified our 

school meal programs and emergency food operations. Our commitment also extends to programs 

like Women, Infants, and Children (WIC), where we've directed an investment of $53 million to 

serve people in need.

In support of these initiatives, our mission support team persistently upholds its responsibility to 

evaluate internal controls within the USDA’s programmatic and operational spheres, alongside the 

vigorous examination of financial reporting processes. The USDA has made substantial headway in 

addressing previously identified material weaknesses, culminating in a fiscal year-end without 

material weaknesses for both the Commodity Credit Corporation (CCC) and the Natural Resources 

Conservation Service (NRCS). For NRCS, this is first time they have received an unmodified 

opinion with no material weaknesses, significant deficiencies, and/or non-compliances with laws 

and regulations. This accomplishment resonates with our commitment to maintaining the highest 

standards of financial management and accountability. Thanks to work behind the scenes, the 

Department has reduced our open audit inventory from 88 in FY 2020 to 52 in FY 2023. 

The challenges posed by the COVID-19 pandemic tested our staff and systems, but we persevered, 

ensuring the uninterrupted continuity of our operations. Our adept management of an impressive 

$61.1 billion in supplemental funding has fortified vital programs within the Coronavirus Aid, 

Relief and Economic Security Act, the Coronavirus Food Assistance Program, Inflation Reduction 

Act, and the American Rescue Plan. Our dedication to excellence is further exemplified by our 
USDA | 2023 Agency Financial Report 3

strides in addressing and closing audit recommendations. Earnest collaboration among USDA 

agencies the Office of Inspector General (OIG) and the Government Accountability Office (GAO), 

has contributed to meticulous accounting and effective utilization of every dollar.

We also depend on the Office of the Inspector General (OIG), whose USDA Management Challenges 

Report, which accompanies the Agency Financial Report, provides vital insight into our operations. 

OIG has recognized our positive steps and cooperation on addressing each recommendation. USDA 

has reduced from 3 to 1 the number of “high risk” areas for improper payments. All Food Safety 

recommendations dating back to June 2020 are now closed, a testament to the commitment of USDA 

employees to the safety of the food on our dinner table. We are actively addressing previously 

identified deficiencies, demonstrating our dedication to continuous improvement. 

OIG’s Management Challenges Report reminds us that we must continue to focus on program 

efficiency and management excellence. Consistent with OIG guidance, USDA will continue to 

expand the use of data analytics to support decision and policy making, deepen our outreach to 

underserved communities and tribal nations, and safeguard information from those who wish to do 

the nation harm. USDA remains committed to overseeing the assessment of internal controls over 

our programs, operations, financial systems, and financial reporting. We adhere to the provisions of 

the Federal Managers' Financial Integrity Act (FMFIA) and the Federal Financial Management 

Improvement Act (FFMIA) to mitigate material weaknesses and ensure compliance. 

USDA’s work is expansive—and it is crucial. It is about farms and the people who work them, and 

it is also about keeping businesses alive in small towns. It’s about school children having access to 

healthy food grown in their own communities. It’s about protecting our planet from droughts and 

wildfires and natural disasters.  It’s about America leading the way in what it means to be a 

sustainable, inclusive, resilient place. 

In FY 2023, USDA was tested, strengthened, and given many opportunities to prove our capabilities 

and vision. Together, we will continue to sow the seeds of hope, growth, and prosperity for all.

Thomas J. Vilsack

Secretary of Agriculture

January 16, 2024
4 Message from the Secretary
USDA | 2023 Agency Financial Report 5

Section I

Management’s Discussion 

and Analysis
USDA Organization Chart

SECRETARY

Deputy Secretary

Assistant Secretary for 

Civil Rights

Assistant Secretary for 

Congressional Relations

Assistant Secretary for 

Administration

Inspector 

General

General 

Counsel

Office of the 

Chief 

Financial 

Officer

Office of the 

Chief 

Economist

Office of the 

Executive 

Secretariat

Office of 

Budget and 

Program 

Analysis

Office of 

Communica

tions

-

Office of 

Tribal 

Relations

Office of 

Partnerships 

& Public 

Engagement

• Higher Education 

• Strategic Initiatives

• 2501 Grants 

Office of 

Hearings 

and Appeals

Office of the 

Chief 

Information 

Officer

Under Secretary for 

Farm Production 

and Conservation

• FPAC Business Center

• Farm Service Agency

• Risk Management 

Agency

• Natural Resources 

Conservation Service

Under Secretary for 

Food, Nutrition, 

and Consumer 

Services

• Food & Nutrition 

Service

Under Secretary for 

Food Safety

• Food Safety and 

Inspection Service

Under Secretary for 

Marketing and 

Regulatory 

Programs

• Agricultural 

Marketing Service

• Animal & Plant 

Health Inspection 

Service

Under Secretary for 

Natural Resources 

and Environment

• Forest Service

Under Secretary for 

Rural 

Development

• Rural Housing 

Service

• Rural Utility Service

• Rural Business 

Cooperative Service

Under Secretary for 

Research, 

Education, and 

Economics

• Office of the Chief 

Scientist

• Agricultural 

Research Service

• National Agricultural 

Statistical Service

• National Institute of 

Food & Agriculture

• Economic Research 

Service

Under Secretary for 

Trade and Foreign 

Agricultural Affairs

• Foreign Agricultural 

Service

• US Codex Office

6 Section I | Management’s Discussion and Analysis
USDA | 2023 Agency Financial Report 7

Mission Areas and Staff Offices

Farm Production and Conservation

Farm Production and Conservation (FPAC) is USDA’s focal point for the Nation’s farmers, ranchers, 

and other stewards of private agricultural and non-industrial private forest lands. FPAC agencies 

implement programs designed to mitigate the significant risks of farming through crop insurance, 

conservation programs, farm safety net programs, lending, and disaster programs.

• Farm Production and Conservation Business Center (FPAC-BC)

• Farm Service Agency (FSA)

• Natural Resources Conservation Service (NRCS)

• Risk Management Agency (RMA)

Food, Nutrition, and Consumer Services

Food, Nutrition, and Consumer Services works to harness the Nation’s agricultural abundance to reduce 

food insecurity and improve nutrition security in the United States. Its operating agency, the Food and 

Nutrition Service, administers Federal domestic nutrition assistance programs and includes the Center 

for Nutrition Policy and Promotion, which links scientific research to the nutrition needs of consumers 

through science-based dietary guidance, nutrition policy coordination, and nutrition education.

• Food and Nutrition Service (FNS)

Food Safety

Food Safety and Inspection Service (FSIS) is the USDA public health agency responsible for 

protecting the public’s health by ensuring the safety of meat, poultry, and egg products. FSIS ensures 

food safety through the authorities of the Federal Meat Inspection Act, the Poultry Products Inspection 

Act, and the Egg Products Inspection Act, as well as humane animal handling through the Humane 

Methods of Slaughter Act.

• Food Safety and Inspection Service (FSIS)
8 Section I | Management's Discussion and Analysis

Marketing and Regulatory Programs

Marketing and Regulatory Programs (MRP) facilitates domestic and international marketing of U.S. 

agricultural products, protects U.S. plant and animal health, regulates genetically engineered 

organisms, administers the Animal Welfare Act, and carries out wildlife damage management 

activities. MRP agencies are active participants in setting national and international standards.

• Agricultural Marketing Service (AMS)

• Animal and Plant Health Inspection Service (APHIS)

Natural Resources and Environment

The mission of Natural Resources and Environment is to sustain the health, diversity, and productivity 

of the Nation’s forests and grasslands to meet the needs of present and future generations. It carries out 

its mission in partnership with States, Tribes, and communities across the country who steward the 

Nation’s forest and grasslands.

• Forest Service (FS)

Research, Education, and Economics

USDA’s Research, Education, and Economics (REE) mission area is dedicated to creating a safe, 

sustainable, competitive, and equitable U.S. food and fiber system. We support American farmers, 

ranchers, and foresters, and help build stronger communities, families, and youth through sound 

integrated research, analysis, and education. REE delivers credible scientific research, economic data, 

statistical analysis, and scientific guidance through our five component organizations. Together, we 

serve as USDA’s core scientific enterprise and work to tackle the world’s most complex agricultural 

challenges with groundbreaking innovations and discoveries.

• Agricultural Research Service (ARS)

• Economic Research Service (ERS)

• National Agricultural Statistics Service (NASS)

• National Institute of Food and Agriculture (NIFA)

• Office of the Chief Scientist (OCS)
USDA | 2023 Agency Financial Report 9

Rural Development

Rural Development (RD) fosters opportunity and economic security for people and communities in 

rural America through a broad range of investments. These investments open doors to better jobs and 

create access to innovation and technology while promoting the promise of rural prosperity, equity, and 

climate resilience. The mission area is a catalyst for locally driven economic development strategies 

that build on the diverse assets and needs of rural places, including improving high-speed internet 

access; providing affordable rural housing; connecting rural skill sets to jobs of the future; modernizing 

roads, bridges, and water systems; and ensuring communities have access to healthcare. RD provides 

tools and resources, such as loans, grants, and strong community partnerships, that ensure rural 

families, businesses, and communities can prosper today and in the future.

• Rural Business-Cooperative Service

• Rural Utilities Service

• Rural Housing Service

Trade and Foreign Agricultural Affairs

Trade and Foreign Agricultural Affairs’ (TFAA) role is to provide our farmers and ranchers with 

opportunities to compete in the global marketplace. TFAA is the Department’s lead on trade policy, 

with the primary responsibility to ensure USDA speaks with a unified voice on international 

agriculture issues domestically and abroad. Within TFAA, the Foreign Agricultural Service is the lead 

U.S. agency tasked with promoting exports of U.S. agricultural products through market intelligence, 

trade policy, trade capacity building, and trade promotion programs. This work is carried out by staff in 

Washington as well as a global network of nearly 100 offices covering approximately 180 countries. 

Also within TFAA, the U.S. Codex Office coordinates U.S. participation in the Codex Alimentarius 

Commission, a joint intergovernmental body of the Food and Agriculture Organization of the United 

Nations and the World Health Organization that sets international food standards while protecting 

consumer health and ensuring fair trade practices.

• Foreign Agricultural Service (FAS)

• US Codex Office

Staff Offices

Our offices provide support to Department officials and employees at all levels, and they support our 

programs and services by working with our agencies, Congress, organizations, and tribal governments. 

To learn more about USDA staff offices, please visit the USDA Staff Offices website for the most 

current data and information.
10 Section I | Management's Discussion and Analysis

Program Performance

Mission, Vision, and Strategic Plan

Mission

To serve all Americans by providing effective, innovative, science-based public policy leadership in 

agriculture, food and nutrition, natural resource protection and management, rural development, and 

related issues with a commitment to deliver equitable and climate-smart opportunities that inspire and 

help America thrive.

Vision

An equitable and climate-smart food and agriculture economy that protects and improves the health, 

nutrition, and quality of life of all Americans; yields healthy land, forests, and clean water; helps rural 

America thrive; and feeds the world.

FY 2022–2026 Strategic Plan

In March 2022, USDA published its FY 2022-2026 Strategic Plan, which outlines the long-term goals 

and objectives USDA hopes to accomplish and what actions the Department will take to realize those 

goals. The Strategic Plan provides the context for decisions about performance goals, priorities, and 

budget planning, and the framework for the detail provided in the Annual Performance Report (APR) 

and Annual Performance Plan (APP). The Strategic Plan focuses on six strategic goals supported by 

21 strategic objectives, as highlighted below. In addition, the Strategic Plan is guided by five 

crosscutting priorities that inform USDA’s work and are woven through the Strategic Plan.
USDA |2023 Agency Financial Report 11

USDA FY 2022-2026 Strategic Plan

Priorities

Addressing Climate Change via 

Climate Smart Agriculture, Forestry 

& Renewable Energy

Advancing Racial Justice, 

Equity & Opportunity

Creating More & Better Market 

Opportunities for Producers and 

Consumers at Home and Abroad

Tackling Food & Nutrition 

Insecurity While 

Maintaining a Safe Food 

Supply

Making USDA a Great Place 

10 Work for Everyone

Strategic Goal

1 

Combat Climate Change 

to Support America’s 

Working Lands, Natural 

Resources, and 

Communities

2 

Ensure America’s 

Agricultural System is 

Equitable, Resilient, and 

Prosperous

3 

Foster an Equitable and 

Competitive Marketplace 

for All Agricultural 

Producers

4 

Make Safe, Nutritious 

Food Available to All 

Americans

5 

Expand Opportunities for 

Economic Development 

and Improve Quality of 

Life In Rural and Tribal 

Communities

6 

Attract, Inspire, and 

Retain an Engaged and 

Motivated Workforce 

that’s Proud to 

Represent USDA

Strategic Objectives

• Use Climate-Smart Management 

and Sound Science to Enhance 

the Health and Productivity of 

Agricultural Lands

• Lead Efforts to Adapt to the 

Consequences of Climate Change 

in Agriculture and Forestry

• Restore, Protect, and Conserve 

Watersheds to Ensure Clean, 

Abundant and Continuous 

Provisions of Water Resources

• Increase Carbon Sequestration, 

Reduce Greenhouse Gas 

Emissions, and Create Economic 

Opportunities (and Develop LowCarbon Energy Solutions)

• Protect Plant and Animal 

Health by Maximizing Major 

Diseases, Pests, and Wildlife 

Conflicts

• Build Resilient Food 

Systems, Infrastructure, and 

Supply Chain

• Foster Agricultural Innovation

• Foster Sustainable Economic Growth 

by Promoting Innovation, Building 

Resiliency to Climate Change, and 

Expanding Renewable Energy

• Expand Markets for Emerging 

Technologies, Sustainable Products, 

and Novel Products

• Expand All Producers’ Access to Global 

Markets Through Negotiation and 

Enforcement of Trade Agreements

• Expand International Marketing 

Opportunities and Build Demand in 

Developing Countries Through Delivery 

of Technical Assistance and Capacity 

Building

• Increase Food Security Through 

Assistance and Access to Nutritious 

and Affordable Food

• Encourage Healthy Dietary Choices 

Through Data-Driven, Flexible, 

Customer-Focused Approaches

• Prevent Foodborne Illness and 

Protect Public Health

• Improve Rural and Tribal Community 

Infrastructure, including Affordable EConnectivity, Cornerstone Community 

Facilities, Sustainable and Reliable 

Power, and Clean and Safe Water and 

Sewer Systems

• Boost the Financial Security of Rural 

and Tribal Communities through 

Access to Affordable Housing

• Increase Capacity, Sustainability, and 

Economic Vitality in Rural and Tribal 

Communities

• Promote Environmental Justice by 

Maximizing Sustainable and Green 

Economic Development in Rural and 

Tribal Communities

• Foster a Culture of Civil Rights, 

Diversity, Equity, Inclusion, 

Accessibility, Transparency, and 

Accountability

• Establish a Customer-Centric, 

Inclusive, High-Performing 

Workforce that is 

Representative of America and 

the Communities We Serve

• Promote USDA Operational 

Excellence Through Better Use 

of Technology and Shared 

Solutions

Performance Management Lifecycle

The Department’s performance management lifecycle, highlighted below, establishes a strategic 

planning process driven by data, supported with evidence, and focused on results.

Performance 

Management 

Lifecycle

Delivering Results for the American People

Planning

• Strategic Plan/Annual Priorities Memos

• Agency Priority Goals

Align ment

• Budget Formulation

• Annual Performance Plan/Report

• Learning Agenda/Capacity Assessment

• Annual Evaluation Plan

• Policy and Regulatory Agenda

• Human Capital Plan

• Enterprise Risk Management

• Agency-level Strategy, Budget, Perf., etc.

Im plem ent

• Budget Execution

M

onitor/Assess

• Quarterly APG/CAP Performance Updates

• Quarterly Strategic Reviews

• Strategic Objective Summary of Findings

• Business Process Improvements

• Annual Financial Report
12 Section I | Management’s Discussion and Analysis

Performance Measurement

The FY 2022-2026 Strategic Plan is supported by performance measures, or Key Performance 

Indicators (KPIs), that measure progress toward achieving the strategic goals and objectives. 

The following graph depicts the FY 2023 Q3 status of USDA’s KPIs, organized by strategic goal.

FY 2023 Q3 Status of USDA KPIs

Goal 1: Combat Climate Change to 

Support America’s Working Lands, 

Natural Resources 

and Communities

5 Achieved or On Target

6 Significantly Below Target (>10%)

10 

Unavailable 

Due to Annual 

Goal 2: Ensure America’s Agricultural Measure

System is Equitable, Resilient, and 

Prosperous

4 Achieved or On Target

1 Significantly Below Target (>10%)

Goal 3: Foster an Equitable and 

Competitive Marketplace for All 

Agricultural Producers

2 Significantly Below Target (>10%)

5 Unavailable Due to Annual Measure

Goal 4: Provide All Americans Safe, 

Nutritious Food

6 Unavailable Due to Annual Measure

Goal 5: Expand Opportunities for 

Economic Development and Improve 

Quality of Life in Rural 

and Tribal Communities

4 Achieved or On Target

2 Significantly Below Target (>10%)

1 Unavailable Due to Annual Measure

Goal 6: Attract, Inspire, and Retain 

an Engaged and Motivated 

Workforce that’s Proud to 

Represent USDA

3 Achieved or On Target

1 Slightly Below Target (<10%)

1 Unavailable Due to Annual Measure

Achieved or On Target

Significantly Below Target (>10%)

Slightly Below Target (<10%)

Unavailable Due to Annual Measure

USDA’s full FY 2023 performance results will be presented in the joint FY 2025 APP/FY 2023 APR. 

The joint APP/APR details USDA’s plans for progress toward achieving the strategic goals and 

objectives described in the USDA FY 2022-2026 Strategic Plan, including plans on agency priority 

goals. This report will be posted on the USDA Our Performance website concurrent with the 

publication of the FY 2025 President’s Budget in February 2024.
USDA | 2023 Agency Financial Report 13

Analysis of Systems, Control, and Legal 

Compliance

Statement of Assurance

USDA’s management is responsible for managing risks and maintaining effective internal control to meet 

the objectives of Sections 2 and 4 of the Federal Managers’ Financial Integrity Act. USDA conducted its 

assessment of risk and internal control in accordance with OMB Circular No. A-123, Management’s 

Responsibility for Enterprise Risk Management and Internal Control. Based on the results of the 

assessment, the Agency can provide reasonable assurance that internal control over operations, reporting, 

and compliance were operating effectively as of September 30, 2023, except for the following material 

weaknesses reported: (1) information technology (IT) and (2) financial management.

In addition, USDA continues to report instances of non-compliance with Anti-Deficiency Act violations, 

two of which were reported to the President and Congress this year, two are pending submission, and two 

are under review as potential violations.

We also assessed the compliance of USDA’s financial management systems with Federal Financial 

Management Systems’ requirements in accordance with FMFIA Section 4; FFMIA Section 803(a); 

and OMB Circular No. A-123, Appendix D. They require Federal agencies to implement and maintain 

financial management systems that comply with Federal financial management system requirements, 

applicable Federal accounting standards, and the U.S. Standard General Ledger at the transaction 

level. As a result of the assessments conducted, we are reporting non-compliance with FFMIA.

The details of the exceptions are provided in the FMFIA, FFMIA, Compliance with Laws and 

Regulations, and Summary of Financial Statement Audit and Management Assurances sections of 

this report. No other material weaknesses were found in the design of the internal control over (1) the 

effectiveness and efficiency of operations and compliance with applicable laws and regulations as of 

September 30, 2023, and (2) internal control over reporting as of September 30, 2023.

Thomas J. Vilsack

Secretary of Agriculture

January 16, 2024
14 Section I | Management's Discussion and Analysis

Federal Managers’ Financial Integrity Act Report on 

Management Control

Background

FMFIA requires ongoing evaluations of internal controls and financial management systems. 

These evaluations lead to an annual statement of assurance that:

• Obligations and costs comply with applicable laws and regulations;

• Federal assets are safeguarded against fraud, waste, abuse, and mismanagement;

• Transactions are accounted for and properly recorded; and

• Financial management systems conform to standards, principles, and other requirements to ensure 

that Federal managers have timely, relevant, and consistent financial information for decisionmaking purposes.

USDA evaluated its internal controls in accordance with OMB Circular No. A-123, Management’s 

Responsibility for Enterprise Risk Management and Internal Control.

USDA remains committed to reducing the risks associated with its deficiencies. It also strives to 

efficiently and effectively operate its programs in compliance with FMFIA and other applicable laws 

and regulations.

The Department operates a comprehensive internal control program. This program ensures compliance 

with the requirements of FMFIA, OMB Circular No. A-123, and its Appendices A through D, and other 

laws and regulations and conformance with FFMIA. All USDA managers must ensure their programs 

operate efficiently and effectively and comply with relevant laws. They must also ensure that financial 

management systems conform to applicable laws, standards, principles, and related requirements. In 

addition, USDA’s management works with the Office of Inspector General (OIG) and the Government 

Accountability Office (GAO) to remediate the root causes of material weaknesses.

The following results may reappear in multiple sections with greater context and content specific 

reporting.
USDA | 2023 Agency Financial Report 15

Fiscal Year 2023 Results

The Department has two material weaknesses in internal controls over information technology (IT) and 

financial management. The material weakness of IT is due to improvements needed in IT security and 

overall effectiveness (See Exhibit 1). The material weakness for financial management is due to 

improvements needed in the Food and Nutrition Service’s internal control structure for implementing 

the change in the Supplemental Nutrition Assistance Program’s obligation point in accordance with 

U.S. generally accepted accounting principles.

The Department reported two Anti-Deficiency Act (ADA) violations to the President and Congress 

during the fiscal year and has two pending issuances of a letters. The Office of the General Counsel 

(OGC) determined that two other potential instances were not ADA violations; and have been referred 

to GAO for a determination. A detailed description and summary of the Department’s ADAs can be 

found in the Compliance with Laws and Regulations section of this report.

The Secretary’s Statement of Assurance provides modified assurance that USDA’s system of internal 

control complies with FMFIA objectives. For additional details on the results reported in USDA’s 

Consolidated Financial Statements Audit Report, see the Summary of Financial Statement Audit and 

Management Assurances section of this report.
16 Section I | Management's Discussion and Analysis

Summary of Outstanding Material Weaknesses

Exhibit 1 provides FY 2023 accomplishments and FY 2024 planned actions toward resolving the 

outstanding material weaknesses.

Exhibit 1: Summary of Outstanding Material Weaknesses

USDA IT

Material Weaknesses Existing

The Department needs to continue its efforts to improve IT 

security and overall IT maturity to an effective level. In addition, 

the Department needs to continue remediation of its remaining 

outstanding audit recommendations.

Overall Estimated Completion Date FY 2024

FY 2023 Accomplishments: FY 2024 Planned Actions:

During FY 2023, the Office of the Chief 

Information Officer (OCIO):

• The Department finalized USDA FISMA 

Improvement Plan on September 12, 2022. 

This comprehensive 5-year strategic vision 

includes a detailed improvement plan that tracks 

projects and efforts to improve the USDA 

Information Security Program and practices. This 

is the department’s plan of action to migrate 

Cyber Security Assessment and Management 

System (CSAM) from National Institute of 

Standards and Technology (NIST) Special 

Publication (SP) 800-53 Revision 4 to SP 800-53 

Revision 5 controls. In addition, the department 

developed an Integrated Project Team to manage 

the project schedule. For the purpose of keeping 

all stakeholders abreast of the requirements 

needed to complete the mitigation, a series of 

meetings were held. The Department continues 

to migrate all systems towards NIST Rev 5.

OCIO will:

• Continue to refine operational processes to align 

with Cybersecurity Diagnostic and Migration 

(CDM) Phases.

• Deploy CDM Phase 3 tools (Network Security 

Management).

• Continue implementing audit recommendations 

from FY 2022 and FY 2023.

• Develop a risk management strategy that will 

align with USDA’s enterprise risk management 

governance.

• Deploy or implement the Security Posture 

Dashboard Report that will incorporate 

operational and compliance IT risk within one 

system.

• Publish Departmental Directives related to: 

Suitability Requirements Permitting Personnel 

Access to Information Systems, Information 

Systems Audit and Accountability, Firewall 

Technical Security Standard, and Security 

Assessment and Authorization.

• Continue to track, monitor, and enforce security 

configuration baselines for USDA servers.
USDA | 2023 Agency Financial Report 17

Federal Financial Management Improvement Act 

Report on Financial Management Systems

FFMIA is designed to improve financial and program managers’ accountability, provide better 

information for decision-making, and improve the efficiency and effectiveness of Federal programs. 

FFMIA requires that financial management systems provide reliable, consistent disclosure of financial 

data in accordance with generally accepted accounting principles and standards. These systems must also 

comply with (1) Federal Financial Management System (FFMS) requirements, (2) applicable Federal 

accounting standards, and (3) the U.S. Standard General Ledger (USSGL) at the transaction level. 

Failure to resolve prior year recommendations identified by USDA’s Office of Inspector General has 

prevented the Department from mitigating repeated deficiencies and receiving a quality rating on the 

five Cybersecurity Framework security functions. More detailed information on the status of corrective 

actions planned and to be completed to comply with the Federal Information Security Modernization 

Act (FISMA) is provided in the USDA Management Challenges section of this report.

The following results may reappear in multiple sections with greater context and content specific 

reporting.

FY 2023 Results

During FY 2023, the USDA evaluated its financial management systems to assess compliance with 

FFMIA. In assessing FFMIA compliance, USDA considered auditors’ opinions on component 

agencies’ financial statements and progress in addressing the material weaknesses identified in the 

FY 2022 Agency Financial Report (AFR). 

USDA is not compliant with USSGL at the transaction level due to deficiencies identified for CCC 

(See Exhibit 2). In addition, as reported in the FFMIA section of this report, USDA continues to have 

weaknesses in IT controls that result in non-compliance with the FISMA requirement. As part of its 

financial systems strategy, USDA agencies continue working to meet FFMIA and FISMA objectives.

The following exhibit contains the outstanding initiatives to achieve compliance.

Exhibit 2: Initiatives to be Completed

Outstanding Initiatives to Achieve FFMIA Compliance

Initiative Section of Non-Compliance Agency Target Completion Date

Information 

Technology

FFMS requirements and information 

security policies, procedures, and/or 

practices.

Multiple 9/30/2024

Financial 

Management USSGL at the transaction level. CCC 9/30/2026
18 Section I | Management's Discussion and Analysis

CCC Non-Compliance

CCC was non-compliant with USSGL. The financial management systems did not record certain 

obligations and accruals at the transaction level in accordance with the USSGL. The agency continues 

to implement compensating controls over the accounting for obligation activity, making significant 

progress. CCC continues implementing its program obligation activity into the Financial Management 

Modernization Initiative through a phased approach. 

CCC Timeline for Remediation:

FY2025: Resume CCC Financial Improvement Project (FFIP) interface with FPAC-BC owned 

applications and FMMI; completion of the Financial Intelligence Enterprise Transformation (FIET) 

initiative.

FY2026: Migration of remediated non-loan, non-fee-based program to FMMI from Core by 

9/30/2026; refine timeline for interface development for loan and fee-based programs and migration of 

programs from Core to FMMI.
USDA | 2023 Agency Financial Report 19

Compliance with Laws and Regulations

USDA has developed strategies to reduce and/or mitigate confirmed violations during FY 2023. 

USDA remains non-compliant with ADA.

The following exhibits provide further details of each violation.

Anti-Deficiency Act

Each agency within USDA conducts assessments on their own Anti-Deficiency Act compliance. Results 

are submitted monthly. Violations are reported to Congress, OIG, and the President.

Exhibit 3: Two ADA Violations were Reported to the President and Congress During 2023

Agency: Office of the Secretary

Violation: Two provisions in the Consolidated Appropriations Act were violated. 

USDA obligated and expended funds appropriated by the Act to prepare 

and deliver the Secretary’s statements and to develop and publish the 

associated press release. USDA’s obligation and expenditure of 

appropriated amounts for this prohibited purpose also violated the ADA, 

31 U.S.C. § 1341(a)(1)(A). The combined cost associated with the 

violation is $68.47.

Year Identified

FY 2017

Agency: CCC

Violation: Tree Assistance Program: 34 unrecorded contracts were signed and 

approved in FY 2021 totaling $1,611,127. In FY 2022, the contracts were 

recorded into the program application yet failed to be recorded into the 

Core Accounting System (CORE) due to being held by the Common 

Obligation Framework as a result of a lack of FY 2021 funds.

Year Identified

FY 2021
20 Section I | Management's Discussion and Analysis

Exhibit 4: ADA Violation Pending Submission to the President and Congress; Two ADA violations are pending 

issuance of letters.

Agency Description of Violation Status Phase

CCC FY 2022: Due to significant, interest rate changes beginning 

January 2022, the initial FY 2022 apportionment requested 

for Interest on Treasury Notes was insufficient. As a result, 

CCC exhausted the initial apportionment of $18,994,570 on 

March 23, 2022. CCC continued to borrow funds and repay 

interest until the funding deficiency was identified on May 17, 

2022. CCC borrowing was suspended immediately until a 

new interest apportionment was approved by OMB on 

May 20, 2022. 

OGC determined 

violation, letter 

pending.

In the final stages 

of the ADA 

process, pending 

updated Estimated 

Completion Date 

(ECD)

ERS USDA transferred about $170,000 from an appropriation for 

NIFA’s relocation expenses to the appropriation for the 

USDA Office of the Secretary. USDA complied with a 

notification requirement in Section 717(a) when it 

transferred to the Office of the Secretary amounts 

appropriated to NIFA. USDA never made the requisite 

notification under Section 717(a) when it transferred 

amounts appropriated to ERS. USDA thus violated the 

notification provision and, as a result, the Anti-deficiency 

Act, and it should report its violation as required by 

31 U.S.C. § 1351.

Reported as 

required by 13 

U.S. Code 1351.

Drafting an ADA 

letter.

Potential ADA Violations—two prior year violations were identified. These occurrences are pending 

results from research and investigation for a determination as to whether a violation occurred. Exhibit 

5 provides a description and status.

Exhibit 5: Prior Years' Identified Potential ADA Violations

Agency Description of Violation Status Phase

CCC FY 2018: Emergency Forestry Conservation 

Reserve Program — CCC failed to record the 

obligation for the full value of the long-term 

contract when the contract was signed. The 

ADA violation amount was $2,200,000.

OGC determined that the 

error was not an ADA 

violation but referred to 

GAO for determination.

In final stages of the 

ADA review process; 

no ECD at this time

CCC FY 2017: The prior year accounting treatment for 

obligations related to the Conservative Reserve 

Program -— Annual Rental contracts were 

determined to be in error with an ADA total of 

$9,921,859,680. Only the annual portion of the 

contract values was recorded as an obligation.

OGC determined that the 

error was not an ADA 

violation but referred to 

GAO for determination.

In final stages of the 

ADA review process; 

no ECD at this time
USDA | 2023 Agency Financial Report 21

Financial Management Systems Strategy

USDA Financial Management Services (FMS) component of the Office of the Chief Financial Officer 

(OCFO) provides timely, accurate, and complete financial information to USDA agencies to execute 

their mission. Specifically, FMS provides cloud-based, commercial off-the-shelf enterprise resource 

planning (ERP) software equipping USDA staff offices and agencies with the functionality necessary 

to distribute, obligate, expend, and report on the funds entrusted to them by the U.S. Congress.

FMS operates as an internal Shared Services Provider (SSP) to USDA staff offices and agencies. FMS 

offers proactive, cost-effective services providing value-added management services, expertise, and 

consultation to Federal agencies to generate efficiencies and support through the consolidation and 

standardization of functions, standard processing, and repeatable processes. 

The OCFO leverages financial system successes to deliver efficient, cost-effective, mission-focused, 

collaboratively developed, and strategically aligned programs and tools. OCFO’s systems’ objectives in 

FY 2024 are to: 

• Build Financial System agility and visibility through integrated ERP systems capability and 

deploying emerging technology.

• Expand capabilities of the OCFO systems to share, reuse, and integrate business capabilities, 

technology, and data across the Department and with external partners and stakeholders.

• Increase application and system efficiencies by collaborating in Department-wide application 

rationalization efforts.

The OCFO will continue to advance its financial systems by implementing emerging ERP technology 

platforms, improving connectivity, reducing the marginal costs of accessing information, and providing 

new ways to aggregate and analyze information.

Financial Management Lines of Business

FMS’s mission as an internal SSP is to provide dependable, cost-effective, employee-centric systems 

and services to USDA organizations, thus enabling customers to focus on serving this great Nation 

through their mission delivery. FMS’s goal is to provide the necessary activities for executing the 

Financial Management Lines of Business vision. The three central components of this vision are 

(1) communication, (2) governance, and (3) operations.

FMS’s key activities include:

• Budget execution

• General ledger accounting

• Financial reporting

• Audit support

• Payroll accounting
22 Section I | Management's Discussion and Analysis

• Investment accounting

• Commercial vendor payments

• Temporary duty travel payments

• Permanent change of station employee relocation payments

• Grant payments

• Purchase card payments

• Lease accounting

• Intragovernmental payments

• Intragovernmental collections

• Receivable management

• Property accounting

• Grants management

FMS’s primary objectives are to:

• Enhance the enterprise financial management services to provide faster, less expensive, and lowrisk solutions to customers.

• Integrate with the National Finance Center payroll processing services.

• Provide an enterprise grants management service featuring a full life cycle management tool for 

grants administration to provide visibility to the Government and the grant recipient.

• Maintain a complete audit-compliant financial solution with full documentation meeting financial 

requirements. 

• Pursue continuous process, operational, and organizational improvements for shared services 

retained in the future state portfolio.

• Provide powerful and flexible financial management and reporting.

• Process administrative payments, collections, and certifications timely and accurately.

Successes During Fiscal Year 2023

For Fiscal Year 2023, FMS made significant strides in accomplishing our objectives and meeting 

milestones. Many of our successes came from implementing mandates from the Office of Personnel 

Management, U.S. Treasury, and achieving milestones in preparation for the Financial Intelligent 

Enterprise Transformation (FIET) implementation. The chart below depicts the initiatives and how 

they support the OCFO System objectives and the estimated completion date. The estimated 

completion date is for the completion of the entire project than spans multiple years. Majority of our 

successes are part of a larger effort or have dependencies that can affect the estimated completion date. 

The narratives describe the milestones achieved throughout FY 2023, as part of the bigger project. 

The following pages will provide additional information on our success throughout the year.
USDA | 2023 Agency Financial Report 23

Exhibit 6: Financial Management (FM) System Objectives

FM System Successes

FM System Objectives

Build Financial 

Systems Agility 

and ERP Visibility 

and Capability

Expand FM System 

Capabilities to 

Integrate Business 

Capabilities, 

Technology, and 

Data

Increase 

Application and 

System Efficiencies 

by Collaborating 

Department-wide

Estimated 

Completion 

Date

AgPay Xpress ✓ ✓ 4QFY23

BOC Initiative ✓ ✓ ✓ 4QFY23

Contract, Lease and Real 

Estate Management ✓ ✓ ✓ 4QFY25

FIET (FY23 Milestones) ✓ ✓ ✓ 2QFY24

Grants Management ✓ ✓ ✓ 4QFY23

Oracle Apex Design ✓ ✓ ✓ 4QFY24

SAP Analytics Cloud ✓ ✓ ✓ 1QFY24

Mobile Check Capture ✓ ✓ ✓ 4QFY23

FM Objectives listed in opening paragraph Financial Management Systems Strategy section.

Grants Management

The ezFedGrants (eFG) System manages grants online throughout a grant’s life cycle. Grant-seeking 

organizations use the eFG External Portal to view and apply for grant award opportunities, view grant 

award package documents, and submit claims and reports. The eFG program is designed for servicing 

grants to organizations such as educational institutions and research organizations.

OCFO’s FMS is the eFG system owner whose mission is to provide guidance and leadership in program 

management, governance, grants and agreements policy, and IT related to the eFG community. 

The enterprise grants and agreements management solution encompasses six USDA agencies and 

includes more than 50 Financial Assistance Listings while transforming USDA’s grants and agreements 

capabilities. The eFG system supports various Federal initiatives, such as homeownership opportunities 

to low-and moderate-income rural Americans, organic agriculture, and several other grant and 

agreement-related programs to serve the American public. 

In FY 2023, eFG initiatives:

• Completed the development and implementation of integration of six web services between the U.S. 

Department of Health and Human Services (HHS) GrantSolutions system and USDA Financial 

Management Modernization Initiative (FMMI) in August 2023. GrantsSolutions is a Grants Quality 

Service Management Office (QSMO) service provider. The integration provides USDA grantmaking agencies the option to migrate to GrantSolutions. The integration of web services from 

USDA FMMI to the HHS Payment Management System (PMS) will be completed in October 2023.
24 Section I | Management's Discussion and Analysis

• Provided system training to 781 internal and external users on eFG. In FY 2023, the eFG system 

has 10,077 users (7,849 external users and 2,228 internal users).

• Continued to maintain a robust user education site, WikiGrants, as an internal repository of eFGrelated materials—such as user guides, training modules, and frequently asked questions—and in 

FY 2023, received 906 unique visitors. The external website for eFG received an average of 7,756 

site visits per month in FY 2023.

• Deployed 2,447 new FY 2023 agreements. During the life of the eFG system, 28,900 agreements 

have been deployed, and 9,907 are active or in draft status.

• Resolved 3,406 tickets (2,847 Tier 1 and 559 Tier 2) through the OCFO eFG Helpdesk as a first 

responder to customer inquiries.

• Resolved 41 ezFedGrants system incidents (21 system defects and 20 enhancements) in FY 2023 

via the eFG Post-Production Support Team. In addition, 670 priority one-time system fixes were 

resolved in FY 2023 as of August 9, 2023.

Budget Object Class Initiative

The purpose of the Business Object Class (BOC) project is to support the USDA Budget Modernization 

effort. OCFO’s role is to ensure BOC code compliance with OMB Circular A-11, Section 83. The 

discovery phase of the BOC initiative ended on October 31, 2021, but continues to analyze and update 

BOCs as anomalies. OCFO determined that the BOC structure could not be restructured at this time due 

to the resources required to accomplish this task. The main objective of this initiative is to improve data 

quality, identify where improvements can be made, and facilitate or improve the agencies’ selection of 

appropriate BOCs for goods and services acquired.

The BOC initiative ensures the proper use of BOCs in FMMI. This initiative ensures BOCs accurately 

describe the goods or service, uses a standard crosswalk table to ensure consistency of BOCs reported 

to external regulatory agencies, and includes system edits and/or validation rules to ensure more 

accurate recordation of goods and services acquired. This effort includes:

• Continuing analysis of all BOC Series.

• Updating the BOC Manual.

• Performing analysis to ensure data quality.

• Gathering requirements on the impact of the BOC changes on the USDA interface systems, Adobe 

forms, and internal processes within FMMI to determine solutions.

• Adding BOC standards to policy and process flows to maintain compliance with OMB Circular A-11.

To reduce erroneous use of BOCs, the OCFO uses edits and/or validations in the SMARTPAY 

Interface program and the Integrated Acquisition System to prevent inappropriate use of BOCs from 

being applied to transactions. As a part of this initiative, OCFO added 20 new BOCs for Information 

Technology. These BOCs will improve cost transparency and quality of data and support Federal 

policies and priorities, such as the Federal Information Technology Acquisition Reform Act 
USDA | 2023 Agency Financial Report 25

(FITARA), Technology Business Management, and OMB reporting requirements. Ongoing efforts for 

the BOC initiative will continue to:

• Update the BOC manual. Once complete, OCFO will continue to improve the recording of data as 

it relates to the use of BOCs.

• Perform analysis to improve data quality.

• Correct SMARTPAY rejects due to inappropriate BOCs.

FMMI Intelligent Enterprise Transformation (FIET)

FMMI, USDA’s financial system of record, is based on a Systems, Applications, and Products (SAP) 

platform and will be obsolete in 2027. Consequently, FMS will migrate to a next-generation SAP 

intelligent enterprise platform leveraging SAP S/4 High-Performance Analytic Appliance (HANA) 

technology. The new S4/HANA system will be an in-memory platform allowing users to run real-time 

reports on operational and financial data. In preparation for the transition, FMS continued the 

Information Lifecycle Management project to develop and implement a data archival strategy and 

system prior to the S/4HANA migration, reducing the cost and improving efficiency of the new 

system. In addition, FMS completed seven strategy and assessment efforts, including business process 

performance optimization, analytics strategy, integration strategy, and S/4HANA security migration 

planning. These, in concert with other prerequisite assessments, will facilitate and inform the greater 

S/4HANA migration. The FIET S/4HANA transition effort will begin in the fourth quarter of FY 2023, 

and completion is scheduled for the second quarter of FY 2025.

SAP Contract, Lease, and Real Estate Management Module within USDA’s EnterpriseWide Financial System FMMI

The Federal Accounting Standards Advisory Board (FASAB) issued SFFAS 54 introducing a new 

model for lease accounting with a mandated implementation date of October 1, 2023. SFFAS 54 

addresses lease accounting standards by both lessees and lessors. For financial reporting purposes, all 

lease transactions must be recognized in accordance with SFFAS 54 when it becomes effective. FMS 

selected the SAP Contract and Lease Management (CLM) module as USDA’s enterprise-wide financial 

system solution. FMS continued SAP CLM implementation in FY 2023, successfully importing the 

framework code for right-to-use and long-term leases into FMMI and resolving six of seven solution 

gaps identified within the CLM solution. In addition, FMS initiated interface development between the 

Corporate Property Automated Information Systems (CPAIS) and FMMI to facilitate data transfer 

between the two systems in support of SFFAS 54. Implementation of CLM right-to-use and long-term 

leases along with the FMMI-CPAIS interface is anticipated in 2nd Quarter FY 2024, to be followed by 

short-term and intragovernmental leases and lessor capabilities in late FY 2024 and FY 2025. 

Treasury’s Mobile Check Capture Program

FMS implemented the use of Treasury’s Mobile Check Capture program, allowing agencies to deposit 

checks to the Electronic Check Processing (ECP) system, eliminating the need to mail the checks to 

the actual Treasury Lockbox. Instead, agencies will make deposits via a mobile phone app. Prior to 
26 Section I | Management's Discussion and Analysis

adopting the Mobile Check Capture program, FMS staff would mail checks to the Treasury Lockbox 

along with remittance information, and U.S. Bank staff would manually key the data into their system 

prior to interfacing with Treasury’s ECP system to process the deposit of funds. By using Mobile 

Check Capture, checks are recorded directly into the ECP system without the requirement of mailing 

checks to U.S. Bank, eliminating manual processing and postage costs. Additionally, deposits are 

recorded at Treasury the next business day, versus 7 to 10 business days when submitting a check 

mailed to the U.S. Bank Lockbox.

AgPay Xpress (AgPay XP)

AgPay XP is a streamlined enhanced payment process to increase USDA rebates by leveraging the 

General Services Administration’s (GSA) SmartPay3 tools for alternative payment options. AgPay XP 

implements U.S. Bank’s Payment Plus solution as USDA’s preferred electronic method for issuing 

payments. It offers contractors a card-less payment solution providing fast and secure payments while 

improving efficiency. A pilot for AgPay XP, which was limited to six vendors, is currently underway. A 

full rollout is projected to start on October 1, 2023.

Oracle Application Express (APEX) Proof of Concept / Redesign

FMS successfully implemented a Proof of Concept (POC) to transition CPAIS from Oracle Forms and 

Reports to Oracle APEX. CPAIS Real Property and CPAIS Personal Property use Oracle Forms and 

Reports 12c for application development. Support for this product will end in August 2025. The 

transition to Oracle APEX will remove a software dependency on the customer’s laptop/workstation 

and move CPAIS to a newer, supported technology. As part of the POC, FMS installed and configured 

the Oracle APEX environments and successfully updated the Real Property’s Maintenance Code form 

and two tabs of the Property Inventory form. An APEX Redesign project is currently underway with 2 

of the 17 planned sprints completed. The APEX Redesign project is projected to be completed by 

September 30, 2024.

SAP Analytics Cloud (SAC)

SAC is a unified analytics and planning solution equipping business intelligence users at all levels of 

USDA with comprehensive data exploration and self-service visualization capabilities. With SAC, 

users will be able to extend their analysis using their personal or agency Business Objects 

queries/universes as data sources, build user stories from local data files or connect live to on-premises 

HANA models, develop planning and forecasting scenarios, build what-if scenarios, and monitor key 

performance indicators. In addition, with its real-time analytics capabilities, users will be able to 

answer complicated business questions and visualize trends in budgeting and spending, for example. 

The implementation of SAC will jump-start the FMMI transition into an intelligent enterprise with a 

single-user experience. This implementation will provide customers the added features needed to make 

business decisions quickly. In addition, SAC will be used to redesign existing dashboards and serve as 

the foundation to replace the Budget Status and Forecasting functionality, which was developed with 

antiquated/unsupported technologies. Requirements, design, and development of SAC is complete, 

with implementation projected for the first quarter of FY 2024. 
USDA | 2023 Agency Financial Report 27

Other Initiatives 

Farm Service Agency/Commodity Credit Corporation Financial Improvement Program 

FSA’s financial accounting, including the Commodity Credit Corporation, whose programs are 

operated primarily by FSA, is not integrated into the FMMI system, creating reconciliation and other 

issues including additional costs to maintain a separate set of systems.

This project is a multi-phased, multi-year agile development project transferring all financial 

management processes from FSA accounting and feeder systems into FMMI. Simultaneously, FSA will 

align its feeder systems to produce auditable financial data to integrate with FMMI. In FY 2023, the 

Financial Improvement Program project migrated the code developed to date into the FMMI 

production environment in preparation for the FMMI migration to S/4HANA. Further code 

development, testing, and implementation activities will occur after the S/4HANA migration is 

complete in FY 2025.

Financial Management and Payroll Summit (FMPS)

The OCFO FMS team, in collaboration with National Finance Center, successfully organized and 

executed the FMPS offered to USDA agency personnel and Client agencies using the USDA’s payroll 

and financial management systems. The FMPS was held in Washington, D.C., on July 18–20, 2023, 

with over 700 participants, in-person and virtually. The FMPS provided financial management courses 

aimed at supporting agency personnel in processing transactional data in the FMMI environment and 

payroll information in the Human Resources/Payroll processing of data. This summit provided our 

customers the opportunity to learn about current financial management initiatives and impending 

changes to systems, processes, and policies. Topics included the transition of FIET, audit requirements, 

and system Security and Compliance in addition to meeting with customers face-to-face.

Enterprise Architecture Program

The OCFO Enterprise Architecture (EA) Program delivers cost-effective, mission-focused, 

collaboratively developed, and strategically aligned programs and services to our stakeholders. 

This ground-up effort achieved several focused objectives during FY 2023, including: 

• Improvement of the OCFO EA Program through increased skills and capabilities of the OCFO EA 

team and maturation of program procedures and governance. The increased program oversight 

ensures conformance to the Federal Legal Authorities and Regulatory Drivers, including the 

Clinger-Cohen Act of 1996, the E-Government Act of 2002, OMB Circular A-11, OMB Circular 

A-130, OMB policy memorandum M-07-11, the House of Representatives (H.R.) 1232—

FITARA, Capital Planning and Investment Control (CPIC), and the Federal Enterprise 

Architecture Framework.

• Clear EA oversight and accountability into decisions and governance of the OCFO IT system to 

align with USDA and OCFO missions.
28 Section I | Management's Discussion and Analysis

• Increased transparency and visibility regarding IT management as well as a line of sight from 

strategic goals to business processes and continuing into the technology architecture (for example, 

data, software, hardware, and technology infrastructure).

Capital Planning and Investment Control Program

CPIC is a systematic approach to selecting, managing, and evaluating IT investments. CPIC is 

mandated by the Clinger Cohen Act of 1996, which requires Federal agencies to focus on the results 

produced by IT investments. The OCFO CPIC Program identifies the processes and activities 

necessary to ensure OCFO’s IT investments are well-planned, cost-effective, and supportive of the 

missions and business goals of the agency and the Department. 

The CPIC team continually monitors OCFO’s IT portfolio, mitigating risks and ensuring the overall 

health of investments. In FY 2023, the CPIC team:

• Successfully retired the Pegasys Financial System Major Investment and transitioned Investment 

Management Activities to the General Services Administration.

• Maintained the health of 95 percent of OCFO’s Major and Non-Major Investments, achieving 

Chief Information Officer rating scores of 4 (Green) or higher.

• Maintained Investment Support Plans to monitor required artifacts for reporting purposes and 

eliminating identified weaknesses.

• In collaboration with EA, CPIC team provided guidance to the OCFO Project Management Office 

in the development of its Product Development Life Cycle.

• Completed the development and implementation of integration of six web services between HHS 

GrantSolutions system and USDA FMMI in August 2023. GrantsSolutions is a Grants QSMO 

service provider. The integration provides USDA grant-making agencies the option to migrate to 

GrantSolutions. The integration of web services from USDA FMMI to the HHS PMS will be 

completed in October 2023.
USDA | 2023 Agency Financial Report 29

Analysis of Financial Statements 

Analysis of Assets

Total assets for FY 2023 were $479,211 million, compared to $415,885 million for FY 2022, an 

increase of $63,326 million, or 15%.

Exhibit 7: Total Assets ($ in millions)

Assets ($ in million) FY 2023 FY 2022 Change % Change

Fund Balance with Treasury $ 339,197 $ 284,081 $ 55,116 19.40%

Direct Loans and Loan Guarantees, Net 125,273 118,254 7,019 5.94%

Accounts Receivable, Net 7,905 7,201 704 9.78%

Property, Plant and Equipment, Net 3,115 2,835 280 9.88%

Negative Liability for Loan Guarantees 2,325 1,939 386 19.91%

Investments, Net; Advances and Prepayments; 

Cash and Other Monetary; Commodity Loans, Net; 

Inventory and Related Property, Net; and Other

1,396 1,575 (179) -11.37%

Total Assets $ 479,211 $ 415,885 $ 63,326 15.23%

Total assets increased mainly due to appropriations for the Supplemental Nutrition Assistance Program 

and credit program activity which increased Fund Balance with Treasury and Direct Loans and Loan 

Guarantees, Net, respectively.

Direct Loans and Loan Guarantees, Net is one of the largest assets on the USDA Balance Sheet. RD 

offers both direct and guaranteed loan products for rural housing and rural business infrastructure. These 

products represent 86 percent of the total Department loan programs. Loan programs administered by the 

FSA represent 12 percent of the total. FSA supports farmers who are temporarily unable to obtain private, 

commercial credit. The remaining 2 percent represents commodity loans and credit programs 

administered by CCC. These loans are used to improve economic stability and provide an adequate 
30 Section I | Management's Discussion and Analysis

supply of agricultural commodities. CCC credit programs provide international food assistance, expand 

international markets, and provide domestic low-cost financing to protect farm income and prices.

Analysis of Liabilities

Total liabilities for FY 2023 were $204,287 million, compared to $192,890 million for FY 2022, and 

increase of $11,397 million, or 6%.

Exhibit 8: Total Liabilities ($ in millions)

Liabilities ($ in millions) FY 2023 FY 2022 Change % Change

Debt $ 151,834 $ 139,187 $ 12,647 9.09%

Insurance and Guarantee Program 17,337 17,325 12 0.07%

Benefits Due and Payable 8,684 8,479 205 2.42%

Accounts Payable 4,397 2,524 1,873 74.21%

Federal Employee Benefits Payable 1,364 1,334 30 2.25%

Advances from Others and Deferred Revenue; 

Environmental and Disposal; and Other 20,671 24,041 (3,370) -14.02%

Total Liabilities $ 204,287 $ 192,890 $ 11,397 5.91%

Total liabilities increased mainly due to debt related to credit programs and reclassification of a 

repayable advance to Treasury from other liabilities for the Disaster Relief Trust Fund.

Debt is the single largest liability on USDA’s balance sheet. It represents amounts owed primarily to 

Treasury by CCC, FSA and RD. For RD, the debt primarily represents financing to support electric and 

housing loan programs which represent 73 percent of the total debt. For CCC, the debt primarily 

represents financing for price support, export credit guarantees, disaster programs and loans related to 

farm storage facilities which represent 13 percent of the total debt. For FSA, the debt primarily 

represents financing to support direct and guaranteed loan programs, with the majority supporting 

operating, ownership, and emergency loans which represent 14 percent of the total debt.
USDA | 2023 Agency Financial Report 31

Other liabilities decreased mainly due to reclassification of repayable advance to debt. Other liabilities 

include Liquidating Fund Balances Due to the General Fund; Grants, Subsidies, and Contributions; and 

Conservation Reserve Program. See Note 17: Other Liabilities for additional information.

Analysis of Net Cost

Net cost for FY 2023 was $230,968 million, compared to $244,628 million for FY 2022, a decrease of 

$13,660 million, or 6%.

Exhibit 9: Net Costs by Mission Area ($ in millions)

Net Cost ($ in millions) FY 2023 FY 2022 Change % Change

Farm Production and Conservation $ 36,465 $ 32,073 $ 4,392 13.69%

Food, Nutrition, and Consumer Services 172,048 192,370 (20,322) -10.56%

Food Safety 1,213 1,128 85 7.54%

Marketing and Regulatory Programs 3,860 3,731 129 3.46%

Natural Resources and Environment 8,717 8,291 426 5.14%

Rural Development 2,608 1,597 1,011 63.31%

Research, Education and Economics 3,814 3,413 401 11.75%

Trade and Foreign Agricultural Affairs 513 447 66 14.77%

Staff Offices 1,730 1,578 152 9.63%

Net Cost by Mission Area $ 230,968 $ 244,628 $ (13,660) -5.58%

Net cost decreased mainly due to fewer benefits delivered for the Supplemental Nutrition Assistance 

and Child Nutrition Programs.
32 Section I | Management's Discussion and Analysis

Stewardship Investments

Stewardship investments are substantial investments made by the Federal Government for the benefit 

of the Nation but are not physical assets owned by the Federal Government. When incurred, they are 

treated as expenses in determining the net cost of operations. However, these items merit special 

treatment so that users of Federal financial reports know the extent of investments that are made for 

long-term benefit. Such investments are measured in terms of expenses incurred for research and 

development, human capital, and non-Federal physical property. The following exhibit presents a 

comparison of stewardship investments.

Exhibit 10:Stewardship Investments ($ in millions)

Stewardship Investments ($ in millions) FY 2023 FY 2022 Change % Change

Research and Development $ 3,125 $ 2,962 $ 163 5.50%

Human Capital 871 800 71 8.88%

Non-Federal Physical Property 91 80 11 13.75%

Total Stewardship Investments $ 4,087 $ 3,842 $ 245 6.38%

Research and Development represents the largest investment by USDA to develop and transfer solutions 

to agricultural problems of high national priority and provide information access and dissemination to 

ensure high quality, safe food, and other agricultural products; assess the nutritional needs of Americans; 

sustain a competitive agricultural economy; enhance the natural resource base and the environment; and 

provide economic opportunities for rural citizens, communities, and society as a whole.

Investments in Human Capital are mostly made by the National Institute of Food and Agriculture for 

higher education programs. These programs enable universities to broaden their curricula, increase 

faculty development and student research projects. and increase the number of new scholars recruited 

in the food and agriculture sciences.

State and local governments obtain computer systems and other equipment from the Food and 

Nutrition Service for the purpose of administering the Supplemental Nutrition Assistance Program 

which represents most of the non-Federal physical property investments.
USDA | 2023 Agency Financial Report 33

Analysis of Net Position

Net Position is comprised of unexpended appropriations and cumulative results of operations. Net 

position increased $51,929 million, or 23%. mainly due to unexpended appropriations for the 

Supplemental Nutrition Assistance Program.

Exhibit 11: Net Position ($ in millions)

Net Position ($ in millions) FY 2023 FY 2022 Change % Change

Unexpended Appropriations $ 218,658 $ 169,264 $ 49,394 29.18%

Cumulative Results of Operations 56,266 53,731 2,535 4.72%

Net Position $ 274,924 $ 222,995 $ 51,929 23.29%

Analysis of Budgetary Resources

USDA receives most of its funding from appropriations authorized by Congress and administered by 

the U.S. Department of the Treasury. Total budgetary resources consist of the balance at the beginning 

of the year, appropriations received during the year, borrowing authority, and spending authority from 

offsetting collections.

Total budgetary resources were $508,280 million for FY 2023 compared to $465,116 million in 

FY 2022, an increase of $43,164 million, or 9 percent.

Exhibit 12: Budgetary Resources ($ in millions)

Budgetary Resources ($ in millions) FY 2023 FY 2022 Change % Change

Unobligated Balance from Prior Year Budget Authority, Net $ 167,559 $ 120,480 $ 47,079 39.08%

Appropriations 287,272 293,959 (6,687) -2.27%

Borrowing Authority 29,680 29,028 652 2.25%

Spending Authority from Offsetting Collections 23,769 21,649 2,120 9.79%

Total Budgetary Resources $ 508,280 $ 465,116 $ 43,164 9.28%

New Obligations and Upward Adjustments 319,917 298,515 21,402 7.17%

Unobligated Balance, End of Year 188,363 166,601 21,762 13.06%

Status of Budgetary Resources $ 508,280 $ 465,116 $ 43,164 9.28%
34 Section I | Management's Discussion and Analysis

Total budgetary resources increased mainly due to higher Unobligated Balance from Prior Year Budget 

Authority, Net compared to the previous year across multiple agencies representing both expired and 

unexpired balances. 

The status of budgetary resources increased relative to total budgetary resources comprised of new 

obligations and upward adjustments and unobligated balance.

COVID-19

USDA received additional funding of $34,500 million to prevent, prepare for, or respond to COVID-19 

(i.e., coronavirus disease 2019) through the Consolidated Appropriations Act, 2021.

The Consolidated Appropriations Act, 2021 provided funding for, extended, and set out policies for 

various programs and activities, including COVID-19 economic relief measures. It extended 

modifications to Federal nutrition assistance programs for children, pregnant women, and older adults 

and provided funding for programs to support agricultural producers, growers, and processors.

This funding was in addition to funding received through the Coronavirus Aid, Relief, and Economic 

Security (CARES) Act, Families First Coronavirus Response Act in FY 2020, and American Rescue 

Plan Act of 2021. The unobligated unexpired balances from prior year, new budgetary authority and 

recissions and other changes to budgetary resources was $40,982 million. Total obligations and outlays 

were $28,619 million and $14,997 million, respectively. Total amount remaining to be obligated is 

$12,363 million. 

See Note 27, COVID-19 Activity for impact to financial statements.

Limitations of Financial Statements

The financial statements are prepared to report the financial position, financial condition, and results of 

operations, consistent with the requirements of 31 U.S. Code (U.S.C.) § 3515(b). The statements are 

prepared from records of Federal entities in accordance with Federal generally accepted accounting 

principles and the formats prescribed by OMB. Reports used to monitor and control budgetary 

resources are prepared from the same records. Users of the statements are advised that the statements 

are for a component of the U.S. Government.
USDA | 2023 Agency Financial Report 35

Forward Looking Information

The purpose of this section is to reflect on known and anticipated risks, uncertainties, future events or 

conditions, and trends that could significantly affect the Department’s future financial position, 

condition, or operating performance. Farmers and ranchers operate in highly competitive markets, both 

domestically and internationally. Rapid shifts in consumer demands associated with quality, 

convenience, taste, and nutrition dictate that farming, ranching, and marketing infrastructures become 

more fluid and responsive. National security is a significant, ongoing priority for USDA. The 

Department’s science research, education, and extension services will continue to be the foundation for 

understanding developments and making advances in solving agricultural and societal challenges. 

USDA is working with the U.S. Department of Homeland Security to help protect agriculture from 

intentional and accidental acts that may impact America’s food supply or natural resources. 

External Factors that Challenge USDA’s Ability to Achieve its Goals

a. Operational complications in human capital, including hiring and recruitment, training, and an 

increasing gap between opportunities and candidate pools;

b. Record-breaking wildfires and other weather-related hardships, including disasters related to the 

increasing intensity and duration of extreme weather and climate change, both domestically and 

internationally; 

c. The risk of catastrophic fire, depending on weather, drought conditions, and the expanding 

number of communities in the wildland-urban interface;

d. Non-weather-related hardships and other uncontrollable events, both domestically and 

internationally;

e. Domestic and international macroeconomic factors, including inflation, consumer purchasing 

power, the strength of the U.S. dollar, and political changes abroad that could impact domestic 

and global markets significantly at any time;

f. Sharp fluctuations in farm prices, interest rates, and unemployment that could impact the ability 

of farmers, other rural residents, communities, and businesses to qualify for credit and manage 

debt; 

g. The increased movement of people and goods, which provides the opportunity for crop and 

animal pests and diseases to move quickly across domestic and international boundaries; and 

h. The ability of the public and private sectors to collaborate effectively on food safety, security, 

and related emergency preparedness efforts.
36 Section I | Management's Discussion and Analysis

Mitigation Strategies 

USDA made progress in FY 2023 toward mitigating known and anticipated risks and uncertainties that 

could impact its ability to accomplish the strategic goals and objectives in the FY 2022-2026 Strategic 

Plan, including external factors, through its Enterprise Risk Management (ERM) program. Specifically, 

the Department has led large-scale efforts across mission areas to identify the top USDA enterprise risks, 

risk drivers, mitigation strategies, and key risk indicators. In FY 2024, USDA will continue to strengthen 

its ERM program and update the Department-wide risk profile, including risk drivers and risk mitigation 

strategies. Moving forward, USDA will continue to advance its mitigation strategies and reduce risks 

with periodic updates to the Deputy Secretary during Quarterly Strategic Reviews.

Summary of Efforts to Assess, Measure, and Mitigate 

Climate-Related Risks

In 2023, USDA and its agencies have made significant progress department-wide to address the 

priority actions outlined in the USDA Action Plan for Climate Adaptation and Resilience and the 

12 Agency-Level Climate Adaptation Plans. 

Climate risks to physical assets continue to be important considerations across the Department and 

examples of recent progress to address these risks include:

• Revision of USDA’s Continuity of Operations Plan by USDA’s Office of Homeland Security. 

The new Plan will include content related to the impacts of climate change and precautions which 

agencies and offices can take to prepare and respond.

• Release of a beta version of the Forest Service Climate Risk Viewer, to assess climate risks and 

vulnerabilities within the National Forest System. Developed with 28 high-quality datasets, this 

tool delivers information on wildfire and climate exposure to key resources and values including 

water and watersheds, biodiversity and species at risk, forest carbon, and mature and old growth 

characteristics. This will allow forest managers to assess the potential gaps between climate 

pressures and current management and identify the need for climate adaptation to maintain valued 

forest ecosystems and watersheds.

• In August 2022 and May 2023, USDA announced investments stemming from the Bipartisan 

Infrastructure Law in the Legacy Roads and Trails Program and the Collaborative Aquatic 

Landscape Restoration Program. Through these investments, USDA is ensuring that roads and 

bridges on national forests and grasslands and aquatic habitats are climate resilient for the benefit 

of visitors and surrounding communities.

• To adapt recreation facilities to a changing climate, USDA’s Forest Service is developing recreationfocused vulnerability assessments and adaptation planning tools for several national forests.
USDA | 2023 Agency Financial Report 37

Recent measures to manage climate-related financial risk at USDA include:

• Inclusion of Forest Service projections of future wildfire area and suppression expenditures in the 

White House OMB’s comprehensive Climate Risk Exposure Assessment for FY 2023. 

Researchers from the Forest Service provided this information using state-of-the-art climate data, 

developing new projections of future wildfire areas burned and increases in Federal Government 

spending needed to suppress those fires. Forthcoming Economic Research Service analysis on the 

Farm Service Agency’s Livestock Forage Program will be included in reporting with the FY 2025 

President’s Budget.

• Continued contribution of RD’s Rural Housing Service (RHS) to the White House National 

Initiative to Advance Building Codes, Building Codes Task Force. This interagency effort led by 

the Federal Emergency Management Agency (FEMA) is working to ensure buildings are built to 

modern resilient codes.

• Development of an internal-facing new “Weather-Adjusted Portfolio Risk Dashboard” to assess 

RD’s risk of financial loss due to the portfolio’s exposure to five hydrometeorological hazards: 

coastal flooding, river flooding, hurricane, tornado, and wildfire. In addition to disaster-type, risk 

is evaluated by program area and geography (National, State, county, and census tract). The total 

risk scoring reflects the geometric mean of up to three factors: unpaid principal at risk, social 

vulnerability, and rurality. The dashboard was developed to better contextualize the climate risk 

exposure in the communities RD programs serve and help RD staff better meet mission goals and 

program priorities.

• Section 5c of Executive Order 14030 requires the U.S. Department of Housing and Urban 

Development, USDA, and U.S. Department of Veterans Affairs to better integrate climate-related 

risk into their lending programs and practices. OMB is leading the agencies’ efforts to better 

understand the climate-related financial risk exposure of the single-family housing mortgage 

portfolios. Last year these efforts resulted in a three-part analysis that included: 

▪ Retrospective analysis assessing changes in the agencies’ 90-day delinquency rates 

following 18 disasters that resulted in Presidentially Declared Major Disaster Areas.

▪ Current exposure analysis utilizing the FEMA National Risk Index to measure current 

portfolio exposure and to estimate the expected annual loss from different natural disasters 

based upon unpaid principal balances.

▪ Prospective analysis projecting financial loss over the next 30 years given different 

economic and climate conditions as specified in base case and severe adverse scenarios. 

The final report submitted to OMB also included a qualitative assessment and risk matrix. This year we 

are updating and strengthening the analyses with current data and additional, recent-year historical data.
38 Section I | Management's Discussion and Analysis
USDA | 2023 Agency Financial Report 39

Section II

Financial Information
40 Section II | Financial Information

Message from 

the Office of the Chief Financial Officer

Dear Valued Stakeholders,

I am pleased to present the FY 2023 Financial Statements on behalf 

of USDA. Our Department remains committed to overseeing the 

assessment of internal control over USDA's programs, operations, 

financial systems, and financial reporting. I am delighted to share 

that USDA has made significant progress in addressing material 

weaknesses; ending the fiscal year with no material weaknesses in 

any of our standalone financial statement audits. This 

accomplishment would not have been possible without our 

dedicated and hardworking employees. 

Amidst the challenges brought about by the COVID-19 pandemic, our dedicated staff at OCFO has 

demonstrated remarkable resilience and adaptability, ensuring the continuity of operations. We 

have successfully managed $61.13 billion in supplemental funding for various USDA programs, 

providing guidance on process controls, accounting, and financial reporting related to the funding. 

This has helped us to effectively support and allocate resources to programs under the Coronavirus 

Aid, Relief and Economic Security Act, Infrastructure Investment and Jobs Act, the American 

Rescue Plan and Inflation Reduction Act.

Additionally, we have made significant progress in closing audit recommendations, further 

strengthening our internal controls and compliance. Our commitment to improving internal controls 

and accountability is evident in the reduction of audit inventories and the diligent collaboration with 

USDA agencies, OIG, and GAO. In USDA’s most recent GAO letter, we were recognized for 

achieving a recommendation implementation rate of 86 percent; exceeding GAO’s 80% goal. 

We are also very excited about our award of services to upgrade USDA’s core financial system to 

SAP S/4 High-Performance Analytic Appliance (S/4HANA). This upgrade meets the evolving and 

increasingly complex financial system needs of USDA. Once completed, our financial system will 

provide enhanced reporting capabilities, faster processing times, an improved customer experience, 

and a host of other benefits expanding USDA’s financial management capabilities. As one of the 

first federal agencies to make the transformational upgrade to S/4HANA, USDA is well positioned 

to be a leader within the greater federal financial management community.

At the OCFO, we remain dedicated to sound financial stewardship and continuously strive to 

maintain and improve our systems for proper accounting and effective utilization of funds. 

Our ultimate goal is to support USDA’s mission and serve you, the American public.
USDA | 2023 Agency Financial Report 41

We would like to express our sincere gratitude for your continued support and partnership. It is 

through your trust and collaboration that we are able to fulfill USDA’s mission and serve the 

American public. We look forward to another successful year ahead, as we remain committed to 

upholding the highest standards of financial management and accountability.

Thank you once again for your continued support.

Sincerely,

Lynn Moaney

Deputy Chief Financial Officer

January 16, 2024
42 Section II | Financial Information

Independent Auditors Report 

OFFICE OF INSPECTOR GENERAL 

United States Department of Agriculture 

DATE: January 16, 2024 

AUDIT 

NUMBER: 50401-0022-11 

TO: Lynn Moaney 

Deputy Chief Financial Officer 

Office of the Chief Financial Officer 

ATTN: Christopher Simmons 

Director 

Internal Controls Division 

FROM: Janet Sorensen 

Assistant Inspector General for Audit 

SUBJECT: USDA’s Consolidated Financial Statements for Fiscal Years 2023 and 2022 

This report presents the results of our audits of the United States Department of Agriculture’s 

(USDA) consolidated financial statements for the fiscal years ending September 30, 2023, and 

2022. The report contains a qualified opinion on the financial statements, as well as the results of 

our assessments of USDA’s internal control over financial reporting and compliance with laws 

and regulations. Your written response is included in its entirety in Exhibit A. We have 

incorporated an excerpt from your response, and the Office of Inspector General’s position into 

the relevant section of the report. Based on your written response, we are accepting management 

decision for the recommendation in the report, and no further response to this office is necessary. 

In accordance with Departmental Regulation 1720-1, final action needs to be taken within 1 year 

of each management decision to prevent being listed in the Department’s annual Agency 

Financial Report. Please follow your internal agency procedures in forwarding final action 

correspondence to the Office of the Chief Financial Officer. 

We appreciate the courtesies and cooperation extended to us by members of your staff during our 

audit fieldwork and subsequent discussions. This report contains publicly available information 

and will be posted in its entirety to our website (https://usdaoig.oversight.gov) in the near future. 
USDA |2023 Agency Financial Report	 43

AUDIT REPORT 50401-0022-11 

Independent Auditor’s Report 

Lynn Moaney 

Deputy Chief Financial Officer 

Office of the Chief Financial Officer 

The United States Department of Agriculture’s (USDA) Office of Inspector General (OIG) 

audited the consolidated financial statements of the USDA for fiscal years (FY) 2023 and 2022. 

We also considered USDA’s internal control over financial reporting and tested USDA’s 

compliance with certain provisions of applicable laws, regulations, contracts, and grant 

agreements that could have a direct effect on the determination of material financial statement 

amounts and disclosures on these consolidated financial statements. 

Section 1 presents the material weaknesses and Section 2 presents the instances of 

noncompliance with laws and regulations, as of and for the year ended September 30, 2023. 

Exhibit A presents USDA’s response in its entirety. 

Report on the Consolidated Financial Statements 

Qualified Opinion 

We have audited the accompanying consolidated financial statements of USDA, which comprise 

the consolidated balance sheets as of September 30, 2023 and 2022, and the related consolidated 

statements of net cost, and changes in net position; and the combined statements of budgetary 

resources for the fiscal years then ended and the related notes to the consolidated financial 

statements (hereinafter referred to as the “consolidated financial statements”). 

In our opinion, except for the possible effects on the FY 2023 consolidated financial statements 

of the matter described in the Basis for Qualified Opinion section of our report, the consolidated 

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

position of USDA, as of September 30, 2023 and 2022, and its net costs, changes in net position, 

and budgetary resources for the year then ended, in accordance with United States of America 

(U.S.) generally accepted accounting principles. 

Basis for Qualified Opinion 

In September 2023, USDA changed the obligation recognition point for the Supplemental 

Nutrition Assistance Program (SNAP) benefits and included obligations of more than $11 billion 

related to the October 2023 benefits in the New Obligations and Upward Adjustments (Total) 

line of the Combined Statements of Budgetary Resources (SBR) for the year ended September 

30, 2023. These obligations also impacted the balances reported on the Apportioned, Unexpired 

Accounts and Expired Unobligated Balance, End of Year lines of the Combined SBR. However, 

management was unable to provide adequate evidential matter to support compliance with U.S. 
44 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

generally accepted accounting principles after the change. As a result, we were unable to 

determine whether any adjustments to the consolidated financial statements were necessary. 

We conducted our audits in accordance with U.S. generally accepted government auditing 

standards, the standards applicable to financial statement audits contained in Government 

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

Management and Budget (OMB) Bulletin No. 24-01, Audit Requirements for Federal Financial 

Statements. Our responsibilities under those standards and OMB Bulletin No. 24-01 are further 

described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial 

Statements section of our report. We are required to be independent of the USDA and to meet 

our other ethical responsibilities, in accordance with the relevant ethical requirements relating to 

our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to 

provide a basis for our qualified audit opinion on the consolidated financial statements. 

Other Matter 

Interactive Data 

Management has elected to reference information on websites or other forms of interactive data 

outside the FY 2023 Agency Financial Report (AFR) to provide additional information for the 

users of its consolidated financial statements. Such information is not a required part of the basic 

consolidated financial statements or supplementary information required by the Federal 

Accounting Standards Advisory Board (FASAB). The information on these websites has not 

been subjected to any of our auditing procedures, and accordingly we do not express an opinion 

or provide any assurance on it. 

Responsibilities of Management 

Management is responsible for: 

• the preparation and fair presentation of the consolidated financial statements in 

accordance with U.S. generally accepted accounting principles; 

• preparing, measuring, and presenting required supplementary information (RSI) in 

accordance with U.S. generally accepted accounting principles; 

• preparing and presenting other information included in USDA’s AFR, and ensuring the 

consistency of that information with the audited financial statements and the RSI; 

• designing, implementing, and maintaining effective internal control over financial 

reporting relevant to the preparation and fair presentation of the consolidated financial 

statements that are free from material misstatement, whether due to fraud or error; and 

• compliance with laws, regulations, contract, and grant agreements applicable to USDA. 
USDA |2023 Agency Financial Report	 45

AUDIT REPORT 50401-0022-11 

Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements 

Our objectives are to (1) obtain reasonable assurance about whether the consolidated financial 

statements as a whole are free from material misstatement, whether due to fraud or error, and (2) 

issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of 

assurance but is not absolute assurance and therefore is not a guarantee that an audit of the 

financial statements conducted in accordance with U.S. generally accepted government auditing 

standards, and OMB Bulletin No. 24-01 will always detect a material misstatement or a material 

weakness when it exists. The risk of not detecting a material misstatement resulting from fraud is 

higher than for one resulting from error, as fraud may involve collusion, forgery, intentional 

omissions, misrepresentations, or the override of internal control. Misstatements, including 

omissions, are considered to be material if there is a substantial likelihood that, individually or in 

the aggregate, they would influence the judgment made by a reasonable user based on the 

consolidated financial statements. 

In performing an audit of financial statements in accordance with U.S. generally accepted 

government auditing standards and OMB Bulletin No. 24-01 we: 

• Exercise professional judgment and maintain professional skepticism throughout the 

audit. 

• Identify and assess the risks of material misstatement of the consolidated financial 

statements, whether due to fraud or error, and design and perform audit procedures 

responsive to those risks. Such procedures include examining, on a test basis, evidence 

regarding the amounts and disclosures in the consolidated financial statements. 

• Obtain an understanding of internal control relevant to our audit of the consolidated 

financial statements in order to design audit procedures that are appropriate in the 

circumstances, but not for the purpose of expressing an opinion on the effectiveness of 

USDA’s internal control over financial reporting. Accordingly, no such opinion is 

expressed. 

• Evaluate the appropriateness of accounting policies used and the reasonableness of 

significant accounting estimates made by management, as well as evaluate the overall 

presentation of the consolidated financial statements. 

• Perform other procedures we consider necessary in the circumstances. 

We are required to communicate with those charged with governance regarding, among other 

matters, the planned scope and timing of the audit, significant audit findings, and certain internal 

control-related matters that we identified during the consolidated financial statement audit. 

Required Supplementary Information 

U.S. generally accepted accounting principles issued by FASAB require that the RSI, which 

includes the Management’s Discussion and Analysis (MD&A), be presented to supplement the 
46 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

consolidated financial statements. Such information is the responsibility of management and, 

although not part of the financial statements, is required by FASAB, which considers it to be an 

essential part of financial reporting for placing the consolidated financial statements in 

appropriate operational, economic, or historical context. 

We have applied certain limited procedures to the RSI in accordance with U.S. generally 

accepted auditing standards. These procedures consisted of (1) inquiring of management about 

the methods used to prepare the RSI and (2) comparing the RSI for consistency with 

management’s responses to our inquiries, the consolidated financial statements, and other 

knowledge we obtained during the audits of the consolidated financial statements, in order to 

report omissions or material departures from FASAB guidelines, if any, identified by these 

limited procedures. We did not audit and we do not express an opinion or provide any assurances 

on the RSI because the limited procedures we applied do not provide sufficient evidence to 

express an opinion or provide any assurance. 

Other Information 

USDA’s other information contains a wide range of information, some of which is not directly 

related to the financial statements. This information is presented for the purpose of additional 

analysis and is not a required part of the financial statements or the RSI. Management is 

responsible for the other information included in USDA’s AFR. The other information comprises 

USDA’s Non-Discrimination Statement, Table of Contents, Message from the Secretary, 

Message from the Office of the Chief Financial Officer, Other Information, and AbbreviationsAcronyms sections, but does not include the consolidated financial statements and our auditor’s 

report thereon. Our opinion on the consolidated financial statement does not cover the other 

information, and we do not express an opinion or any form of assurance thereon. 

In connection with our audits of the consolidated financial statements, our responsibility is to 

read the other information and consider whether a material inconsistency exists between the 

other information and the financial statements, or the other information otherwise appears to be 

materially misstated. If, based on the work performed, we conclude that an uncorrected material 

misstatement of the other information exists, we are required to describe it in our report. 

Report on Internal Control Over Financial Reporting 

In connection with our audits of USDA’s consolidated financial statements, we considered 

USDA’s internal control over financial reporting, consistent with our auditor’s responsibilities 

discussed below. 

Our consideration of internal control was for the limited purpose described below and was not 

designed to identify all deficiencies in internal control that might be material weaknesses or 

significant deficiencies or to express an opinion on the effectiveness of USDA’s internal control 

over financial reporting. Therefore, material weaknesses or significant deficiencies may exist 

that have not been identified. As described below, we identified certain deficiencies in internal 

control over financial reporting that we consider to be material weaknesses. 
USDA |2023 Agency Financial Report	 47

AUDIT REPORT 50401-0022-11 

A deficiency in internal control exists when the design or operation of a control does not allow 

management or employees, in the normal course of performing their assigned functions, to 

prevent, or detect and correct, misstatements on a timely basis. A material weakness is a 

deficiency or a combination of deficiencies, in internal control over financial reporting, such that 

there is a reasonable possibility that a material misstatement of USDA’s consolidated financial 

statements will not be prevented, or detected and corrected on a timely basis. We consider the 

deficiencies in overall financial management and the information technology (IT) security 

program, described in “Findings” Section 1, to be material weaknesses. 

A significant deficiency is a deficiency, or combination of deficiencies, in internal control that is 

less severe than a material weakness, yet important enough to merit attention by those charged 

with governance. 

In planning and performing our audit of USDA’s consolidated financial statements as of and for 

the year ended September 30, 2023, in accordance with U.S. generally accepted government 

auditing standards and OMB Bulletin No. 24-01, we considered USDA’s internal control 

relevant to the consolidated financial statement audit in order to design audit procedures that are 

appropriate in the circumstances, but not for the purpose of expressing an opinion on the 

effectiveness of USDA’s internal control over financial reporting. Accordingly, we do not 

express an opinion on USDA’s internal control over financial reporting. 

We are required to report all deficiencies that are considered to be significant deficiencies or 

material weaknesses. We did not consider all internal controls relevant to operating objectives, 

such as those controls relevant to operating objectives as broadly defined by the Federal 

Managers’ Financial Integrity Act of 1982 (FMFIA). 

Report on Compliance with Laws, Regulations, Contracts, and Grant 

Agreements 

In connection with our audits of UDSA’s consolidated financial statements, we tested 

compliance with certain provisions of laws, regulations, contracts, and grant agreements. 

Noncompliance with these provisions could have a direct and material effect on the consolidated 

financial statements. However, the objective of our tests was not to provide an opinion on 

compliance with laws, regulations, contracts, and grant agreements. Accordingly, we do not 

express such an opinion. 

Our tests for compliance with selected provisions of applicable laws, regulations, contracts, and 

grant agreements disclosed instances of noncompliance that are reportable under U.S. generally 

accepted auditing standards or OMB Bulletin No. 24-01. 

Federal Financial Management Improvement Act of 1996 (FFMIA) 

We also performed tests of USDA’s compliance with certain provisions referred to in 

Section 803(a) of FFMIA. Providing an opinion on compliance with FFMIA was not an 

objective of our engagement and, accordingly, we do not express such an opinion. The results of 

our tests of FFMIA disclosed instances, described in more detail in Section 2, of this report, 
48 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

where USDA was not substantially compliant with Federal Financial Management System 

Requirements (FFMSR) and the U.S. Standard General Ledger (USSGL) at the transaction level. 

Antideficiency Act (ADA) 

Title 31 U.S. Code (U.S.C.) §1517 states that an officer or an employee of the United States 

Government may not make or authorize an expenditure or obligation exceeding an 

apportionment or an amount permitted by regulations as prescribed by Title 31 U.S.C. § 1514. In 

FY 2023, the Department reported four confirmed1 and two potential ADA violations in its AFR. 

Payment Integrity Information Act of 2019 (PIIA) 

During FY 2023, the results of our tests disclosed instances of noncompliance with the 

requirements of PIIA.2 Four Phase 2 programs did not meet the PIIA compliance requirements 

on at least two of the following: reduction targets, corrective action plans, or improper payment 

rate of less than 10 percent. We also found that USDA did not ensure that one Phase 1 program 

completed a FY 2022 risk assessment, as required by PIIA, and reporting in the accompanying 

materials incorrectly stated that the program did not need to complete a FY 2022 risk 

assessment.

3 

Our responsibility is to test compliance with selected provisions of applicable laws, regulations, 

contracts, and grant agreements applicable to USDA that have a direct effect on the 

determination of material amounts and disclosures in USDA’s consolidated financial statements, 

and to perform certain other limited procedures. Accordingly, we did not test compliance with all 

provisions of laws, regulations, contracts, and grant agreements applicable to USDA. We caution 

that noncompliance may occur and not be detected by these tests. 

Purpose of the Report on Internal Control Over Financial Reporting and the Report on 

Compliance with Laws, Regulations, Contracts, and Grant Agreements 

The purpose of the “Report on Internal Control Over Financial Reporting” and the “Report on 

Compliance with Laws, Regulations, Contracts, and Grant Agreements” sections is solely to 

describe the scope of our testing of internal control over financial reporting and compliance and 

the results of that testing, and not to provide an opinion on the effectiveness of USDA’s internal 

control over financial reporting or compliance. These reports are an integral part of an audit 

performed in accordance with U.S. generally accepted government auditing standards and OMB 

Bulletin No. 24-01 in considering USDA’s internal control over financial reporting and 

compliance. Accordingly, these reports are not suitable for any other purpose. 

1 Of the four confirmed ADA violations, two have been reported to the President and Congress and two are pending 

submission. 2 Payment Integrity Information Act of 2019 (PIIA), Pub. L. No. 116-117, 134 Stat. 113. 3 Audit Report 50024-0003-24, USDA’s Compliance with Improper Payment Requirements for Fiscal Year 2022, 

issued May 2023. 
USDA |2023 Agency Financial Report	 49

AUDIT REPORT 50401-0022-11 

Management’s Response 

Management’s response to the report is presented in Exhibit A. USDA’s response was not 

subjected to the other auditing procedures applied in the audit of the consolidated financial 

statements, and accordingly we express no opinion on it. 

Janet Sorensen 

Assistant Inspector General for Audit 

Washington, D.C. 

January 16, 2024 
50 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

Findings 

Section 1: Material Weaknesses in Internal Control Over Financial 

Reporting 

Finding 1: Improvements are Needed in Overall Financial Management 

Background 

The material weakness in this finding is related to SNAP which is administered by the Food and 

Nutrition Service. 

SNAP is funded by “appropriated mandatory” spending, also known as “appropriated 

entitlement” spending. The authorization law controls the amount of spending but does not 

contain the necessary appropriations to fund it. The appropriations are provided through the 

annual appropriation process.4

 Annual appropriations, also called fiscal year or 1-year 

appropriations, are made for a specified fiscal year and are available for obligation only during 

the fiscal year for which made.5 

All appropriations are presumed to be annual appropriations unless the appropriation act 

expressly provides otherwise. Annual appropriations are available only to meet bona fide needs 

of the fiscal year for which they were appropriated. An appropriation for a given fiscal year is 

not available for the needs of a future fiscal year. Thus, where an obligation is made toward the 

end of a fiscal year and it is clear from the facts and circumstances that the need relates to the 

following fiscal year, the bona fide needs rule has been violated and the obligation is not a proper 

charge against the earlier appropriation, but must be charged against the following year’s funds.6 

Material Weakness 

The Consolidated Appropriations Act, 2023,7 hereinafter referred to as the Act, appropriated 

more than $153 billion for SNAP for the fiscal year ending September 30, 2023, of which $3 

billion was to remain available through September 2025, in a reserve or contingency fund. As 

stated in the Act, “No part of any appropriation contained in this Act shall remain available for 

obligation beyond the current fiscal year unless expressly so provided herein.”8

 Other than the 

limited contingency funds, there was no specifically expressed availability beyond September 

30, 2023. 

In September 2023, USDA determined and changed the obligation recognition point for SNAP 

benefits. Previously, USDA recorded an obligation when Electronic Benefit Transfer (EBT) 

benefits became available to the program beneficiary to spend – i.e., the benefit “effective date.” 

4 Congressional Research Service, Overview of Funding Mechanisms in the Federal Budget Process, and Selected 

Examples, R44582 (Feb. 2021). 5 U.S. General Accounting Office, Principles of Federal Appropriation Law, GAO-04-261SP (3d ed. 2004). 6 U.S. General Accounting Office, Principles of Federal Appropriation Law, GAO-04-261SP (3d ed. 2004). 7 Consolidated Appropriations Act, 2023, Pub. L. No. 117-328, 136 Stat. 4459. 8 Consolidated Appropriations Act, 2023, Pub. L. No. 117-328, 136 Stat. 4459. 
USDA |2023 Agency Financial Report	 51

AUDIT REPORT 50401-0022-11 

The new process recognizes the obligation of funds for SNAP benefits at the point at which 

USDA authorizes the Federal Reserve Bank, through its Account Management Agent, to begin 

processing State issuance of SNAP benefits. USDA recorded obligations of more than 

$11 billion for October 2023 SNAP benefits on September 19, 2023. As a result, USDA changed 

the method of implementing an accounting principle and moved from an entirely automated 

process for recording SNAP obligations and disbursements for the 53 SNAP EBT states and 

territories to a labor-intensive manual process with increased risk. This change occurred despite 

the fact that USDA had funding available on October 1st for the October 2023 SNAP benefits 

from the Continuing Appropriations Act, 2024 and Other Extensions Act.9 

The change in accounting principle was implemented without first performing adequate analysis 

of the change, including sufficient analysis that accounting for SNAP obligations complied with 

U.S. generally accepted accounting principles after the change, or designing controls for the new 

activities being performed. We further noted controls were being designed as the activities are 

performed. As a result, OIG was unable to obtain sufficient and appropriate evidence that the 

more than $11 billion obligation was a proper charge against the FY 2023 appropriation. 

31 U.S.C. § 1502(a) states, “The balance of an appropriation or fund limited for obligation to a 

definite period is available only for payment of expenses properly incurred during the period of 

availability . . . . However, the appropriation or fund is not available for expenditure for a period 

beyond the period otherwise authorized by law.” 

OMB, Circular No. A-123, identifies management as responsible for developing and maintaining 

effective internal control. The Circular further identifies internal control as the process for 

assuring achievement of the following objectives: effectiveness and efficiency of operations, 

reliability of reporting for internal and external use, and compliance with applicable laws and 

regulations. 

The U.S. Government Accountability Office’s, Standards for Internal Control in the Federal 

Government (Green Book): Green Book, Principle 9, Identify, Analyze and Respond to Change, 

states, in relevant part: 

• 9.04. Management analyzes the effect of identified changes on the internal control system 

and responds by revising the internal control system on a timely basis, when necessary, to 

maintain its effectiveness. 

• 9.05 As part of analyzing and responding to change, management performs a risk 

assessment to identify, analyze, and respond to any new risks prompted by the changes. 

USDA has not adequately identified, analyzed, and responded to the risk significant changes 

pose to the organization in accordance with Green Book Principle 9. There was no formalized 

policy or process to follow when implementing a change in accounting principle and controls 

were not designed and implemented before the change occurred. 

As a result, USDA changed the method of implementing an accounting principle and moved 

from an entirely automated process for recording SNAP obligations and disbursements for the 53 

9 Continuing Appropriations Act, 2024 and Other Extensions Act, Pub. L. No. 118-15, 137 Stat. 71. 
52 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

SNAP EBT states and territories to a labor-intensive manual process with increased risk that the 

financial statements could be materially misstated. 

In December 2023, USDA drafted a Departmental Regulation, Voluntary Changes in Accounting 

Principles, to assist agencies in implementing a structured process for analyzing changes to 

accounting principles, including changes in the method of applying those principles; assessing 

compliance with U.S. generally accepted accounting principles and impacts to financial reporting 

based on the change; and designing controls prior to the implementation of a change. The Office 

of the Chief Financial Officer plans to issue a bulletin by the end of January 2024 while the 

Departmental Regulation is finalized. 

The Food and Nutrition Service has agreed to complete the analysis of the compliance with U.S. 

generally accepted accounting principles and prepare a position paper by March 31, 2024. 

Additionally, in December 2023, USDA provided a document containing legal analysis on the 

permissibility of obligating SNAP benefits for future period eligibility using a 1-year 

appropriation. This document is still under review by OIG. As this document will be a 

component of the position paper, we plan to complete our review once the position paper is 

finalized. 

Recommendation 1 to the Food and Nutrition Service 

Complete analysis on compliance with U.S. generally accepted accounting principles and 

prepare a position paper addressing accounting theory and practice for the accounting for the 

change in obligation recognition implemented in September 2023. 

Agency Response 

In its response, the Food and Nutrition Service stated: 

FNS will complete the analysis recommended by OIG and prepare a position paper 

addressing accounting theory and practice for the accounting for the change in obligation 

recognition implemented in September 2023. 

The estimated completion date is March 31, 2024. 

OIG Position 

We accept the Food and Nutrition Service’s management decision on this recommendation. 
USDA |2023 Agency Financial Report	 53

AUDIT REPORT 50401-0022-11 

Finding 2: Improvements are Needed in Overall Information Technology 

Security Program 

As required by the Federal Information Security Modernization Act of 2014 (FISMA), OIG 

reviewed USDA’s ongoing efforts to improve its IT security program and practices during 

FY 2023.10

 USDA has worked diligently to improve its security posture, but some weaknesses 

remain. Of the 23 prior year recommendations, 1 remains open; 4 were closed by management, 

but the independent certified public accounting firm did not have sufficient time to test whether 

the recommendations were implemented effectively; 2 were closed by management, but testing 

identified deficiencies related to the recommendations; and the remaining 16 closed by 

management were validated by the independent certified public accounting firm as effectively 

remediated. OMB establishes standards for an effective level of security and considers level 4, 

“Managed and Measurable,” to be sufficient. However, we found the Department’s maturity 

level to be at level 3, “Consistently Implemented,” which is ineffective according to OMB’s 

criteria. The Department and its agencies must develop and implement an effective plan to 

mitigate security weaknesses identified in the prior FY recommendations. 

The Office of the Chief Information Officer generally concurred with the findings and 

recommendations in the report. 

10 Audit Report 50503-0011-12, U.S. Department of Agriculture, Office of the Chief Information Officer, Fiscal 

Year 2023 Federal Information Security Modernization Act, issued July 2023. 
54 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

Section 2: Noncompliance with Laws and Regulations 

Finding 3: Lack of Substantial Compliance with FFMIA Requirements 

FFMIA requires agencies to annually assess whether their financial management systems comply 

substantially with (1) FFMSR, (2) applicable Federal accounting standards, and (3) the USSGL 

at the transaction level. FFMIA also requires auditors to report in their Chief Financial Officer 

Act financial statement audit reports whether financial management systems substantially 

comply with FFMIA’s system requirements. In addition, FISMA deficiencies are a component of 

FFMIA compliance. 

During FY 2023, USDA evaluated its financial management systems to assess compliance with 

FFMIA. USDA reported that it was not compliant with FFMSR and USSGL at the transaction 

level. As noted in its MD&A, USDA continues its work to meet FFMIA and FISMA objectives. 

Specifically, in its FFMIA and FMFIA reports, the Department reported an ineffective 

information security program due to many longstanding weaknesses with outstanding 

recommendations. See Finding 2 of this report for more details. 

Additionally, in its FFMIA report, the Department noted noncompliance with the Commodity 

Credit Corporation where the financial management systems did not record certain obligations 

and accruals at the transaction level in accordance with the USSGL. 

Due to planned actions, we are making no further recommendations in this report. 
USDA |2023 Agency Financial Report	 55

AUDIT REPORT 50401-0022-11 

Abbreviations 

ADA............................ Antideficiency Act 

AFR............................. Agency Financial Report 

EBT............................. Electronic Benefits Transfer 

FASAB ........................ Federal Accounting Standards Advisory Board 

FFMIA ........................ Federal Financial Management Improvement Act of 1996 

FFMSR........................ Federal Financial Management System Requirements 

FISMA ........................ Federal Information Security Modernization Act of 2014 

FMFIA ........................ Federal Managers’ Financial Integrity Act of 1982 

FY ............................... fiscal year 

IT................................. information technology 

MD&A ........................ Management’s Discussion and Analysis 

OIG ............................. Office of Inspector General 

OMB ........................... Office of Management and Budget 

PIIA............................. Payment Integrity Information Act of 2019 

RSI .............................. required supplementary information 

SBR............................. Statement of Budgetary Resources 

SNAP .......................... Supplemental Nutrition Assistance Program 

U.S . ............................. United States of America 

U.S.C . .......................... U.S. Code 

USSGL ........................ U.S. Standard General Ledger 

USDA.......................... United States Department of Agriculture 
56 Section II | Financial Information

AUDIT REPORT 50401-0022-11 

Exhibit A: Agencies’ Response 

Agencies’ 

Response to Audit Report 
USDA	|2023	Agency	Financial	Report	 57

Agency Response to Auditors Report

United States

Department of

Agriculture

Office of the Chief

Financial Officer

1400 Independence

Avenue, SW

Washington, DC

20250

January 16, 2024 

TO: Ms. Janet Sorensen

Assistant Inspector General for Audit 

Office of Inspector General

FROM: Lynn Moaney 

Deputy Chief Financial Officer

SUBJECT: U.S. Department of Agriculture’s Financial Statements for Fiscal Years 

2023 and 2022 

The Department is pleased to respond to your audit report on the financial statements 

for fiscal years 2023 and 2022. 

We concur with the findings in the report. We will continue with actions planned and in 

progress to address the findings. 

I would like to express my appreciation for the cooperation and professionalism 

displayed by your staff and your contract auditors during the audit. 

AN EQUAL OPPORTUNITY EMPLOYER
58 Section II | Financial Information

USDA is an Equal Opportunity Provider, Employer and Lender 

DATE: 

INSPECTION 

NUMBER: 50401-0022-11 

TO: Janet Sorenson 

 Assistant Inspector General for Audit 

FROM: Cindy Long 

 Administrator 

 Food and Nutrition Service 

SUBJECT: USDA’s Consolidated Financial Statements for Fiscal Years 2023 and 

2022 

This letter responds to the discussion draft report for audit number 50401-0022-11, USDA’s 

Consolidated Financial Statements for Fiscal Years 2023 and 2022. Specifically, the Food and 

Nutrition Service (FNS) is responding to the one recommendation in the report. 

OIG Recommendation 1: 

Complete analysis on compliance with U.S. generally accepted accounting principles and 

prepare a position paper addressing accounting theory and practice for the accounting for the 

change in obligation recognition implemented in September 2023. 

FNS Response: 

FNS will complete the analysis recommended by OIG and prepare a position paper addressing 

accounting theory and practice for the accounting for the change in obligation recognition 

implemented in September 2023. 

Estimated Completion Date: 

March 31, 2024 

Food and 

Nutrition 

Service 

1320 

Braddock 

Place 

Alexandria 

, VA 

22314 
USDA | 2023 Agency Financial Report 59

Financial Statements

Consolidated Balance Sheets

As of September 30, 2023 and 2022 ($ in millions)

Item FY 2023 FY 2022

Assets (Note 2): 

Intragovernmental Assets: 

Fund Balance with Treasury (Note 3) $ 339,197 $ 284,081

Investments, Net (Note 5) 280 268

Accounts Receivable, Net (Note 6) 606 495

Advances and Prepayments 63 54

Other Assets (Note 11) 9 —

Total Intragovernmental Assets 340,155 284,898

Other than Intragovernmental Assets:

Cash and Other Monetary Assets (Note 4) 388 492

Accounts Receivable, Net (Note 6) 7,299 6,706

Loans Receivable, Net

Commodity Loans, Net 197 239

Direct Loans and Loan Guarantees, Net (Note 7) 125,273 118,254

Subtotal 125,470 118,493

Negative Liability for Loan Guarantees (Note 7) 2,325 1,939

Inventory and Related Property, Net (Note 8) 27 28

Property, Plant, and Equipment, Net (Note 9) 3,115 2,835

Advances and Prepayments 429 491

Investments, Net (Note 5) 3 3

Total Other than Intragovernmental Assets 139,056 130,987

Total Assets 479,211 415,885

Stewardship Property, Plant, and Equipment (Note 10) 

Liabilities (Note 12): 

Intragovernmental Liabilities: 

Accounts Payable 68 —

Debt (Note 13) 151,834 139,187

Advances from Others and Deferred Revenue 24 24

Other Liabilities (Note 17) 9,766 14,236

Total Intragovernmental Liabilities 161,692 153,447

Other than Intragovernmental Liabilities:

Accounts Payable 4,329 2,524

Federal Employee Benefits Payable (Note 14) 1,364 1,334

Environmental and Disposal Liabilities (Note 15) 248 241

Benefits Due and Payable 8,684 8,479

Insurance and Guarantee Program Liabilities (Note 16) 17,337 17,325

Advances from Others and Deferred Revenue 194 153

Other Liabilities (Notes 17, 18 & 19) 10,439 9,387

Total Other than Intragovernmental Liabilities 42,595 39,443

Total Liabilities 204,287 192,890

Commitments and Contingencies (Note 19) 

Net Position: 

Unexpended Appropriations - Funds from Dedicated Collections (Note 20) 818 661

Unexpended Appropriations - Funds from Other Than Dedicated Collections 217,840 168,603

Total Unexpended Appropriations (Consolidated) 218,658 169,264

Cumulative Results of Operations - Funds from Dedicated Collections (Note 20) 4,247 3,878

Cumulative Results of Operations - Funds from Other Than Dedicated Collections 52,019 49,853

Total Cumulative Results of Operations (Consolidated) 56,266 53,731

Total Net Position 274,924 222,995

Total Liabilities and Net Position $ 479,211 $ 415,885

The accompanying notes are an integral part of these statements.
60 Section II | Financial Information

Consolidated Statements of Net Cost

For the Years Ended September 30, 2023 and 2022 ($ in millions)

Item FY 2023 FY 2022

Farm Production and Conservation: 

Gross Costs $ 42,863 $ 37,006

Less: Earned Revenue 6,398 4,933

Net Costs 36,465 32,073

Food, Nutrition, and Consumer Services: 

Gross Costs 172,167 192,464

Less: Earned Revenue 119 94

Net Costs 172,048 192,370

Food Safety: 

Gross Costs 1,444 1,374

Less: Earned Revenue 231 246

Net Costs 1,213 1,128

Marketing and Regulatory Programs: 

Gross Costs 5,192 4,893

Less: Earned Revenue 1,332 1,162

Net Costs 3,860 3,731

Natural Resources and Environment:

Gross Costs 9,622 9,076

Less: Earned Revenue 905 785

Net Costs 8,717 8,291

Rural Development: 

Gross Costs 6,177 4,814

Less: Earned Revenue 3,569 3,217

Net Costs 2,608 1,597

Research, Education, and Economics: 

Gross Costs 3,919 3,495

Less: Earned Revenue 105 82

Net Costs 3,814 3,413

Trade and Foreign Agricultural Affairs: 

Gross Costs 532 467

Less: Earned Revenue 19 20

Net Costs 513 447

Staff Offices:

Gross Costs 1,962 1,821

Less: Earned Revenue 232 243

Net Costs 1,730 1,578

Total Gross Costs 243,878 255,410

Less: Total Earned Revenue 12,910 10,782

Net Cost of Operations (Notes 21 & 25) $ 230,968 $ 244,628

The accompanying notes are an integral part of these statements.
USDA | 2023 Agency Financial Report 61

Consolidated Statement of Changes in Net Position

For the Year Ended September 30, 2023 ($ in millions)

Item Funds from 

Dedicated 

Collections 

(Consolidated 

Totals) (Note 20)

Funds from Other 

Than Dedicated 

Collections 

(Consolidated 

Totals) Consolidated Total

Unexpended Appropriations: 

Beginning Balances $ 661 $ 168,603 $ 169,264

Appropriations Received 11 269,206 269,217

Appropriations Transferred In (Out) 285 (121) 164

Other Adjustments — (8,177) (8,177)

Appropriations Used (139) (211,671) (211,810)

Net Change in Unexpended Appropriations 157 49,237 49,394

Total Unexpended Appropriations 818 217,840 218,658

Cumulative Results of Operations: 

Beginning Balances 3,878 49,853 53,731

Other Adjustments — (691) (691)

Appropriations Used 139 211,671 211,810

Non-exchange Revenue 269 25,533 25,802

Donations and Forfeitures of Cash and Cash Equivalents 1 2 3

Transfers In (Out) without Reimbursement 952 (1,602) (650)

Imputed Financing 40 1,277 1,317

Other (88) (4,000) (4,088)

Net Cost of Operations (944) (230,024) (230,968)

Net Change in Cumulative Results of Operations 369 2,166 2,535

Total Cumulative Results of Operations 4,247 52,019 56,266

Net Position $ 5,065 $ 269,859 $ 274,924

The accompanying notes are an integral part of these statements.
62 Section II | Financial Information

Consolidated Statement of Changes in Net Position

For the Year Ended September 30, 2022 ($ in millions)

Item Funds from 

Dedicated 

Collections 

(Consolidated 

Totals) (Note 20)

Funds from Other 

Than Dedicated 

Collections 

(Consolidated 

Totals) Consolidated Total

Unexpended Appropriations: 

Beginning Balances $ 468 $ 127,658 $ 128,126

Appropriations Received 12 285,236 285,248

Appropriations Transferred In (Out) 285 (358) (73)

Other Adjustments — (21,650) (21,650)

Appropriations Used (104) (222,283) (222,387)

Net Change in Unexpended Appropriations 193 40,945 41,138

Total Unexpended Appropriations 661 168,603 169,264

Cumulative Results of Operations: 

Beginning Balances 3,473 44,854 48,327

Other Adjustments — (553) (553)

Appropriations Used 104 222,283 222,387

Non-exchange Revenue 623 31,306 31,929

Donations and Forfeitures of Cash and Cash Equivalents 1 2 3

Transfers In (Out) without Reimbursement 1,151 (1,429) (278)

Imputed Financing 30 975 1,005

Other (234) (4,227) (4,461)

Net Cost of Operations (1,270) (243,358) (244,628)

Net Change in Cumulative Results of Operations 405 4,999 5,404

Total Cumulative Results of Operations 3,878 49,853 53,731

Net Position $ 4,539 $ 218,456 $ 222,995

The accompanying notes are an integral part of these statements.
USDA | 2023 Agency Financial Report 63

Combined Statements of Budgetary Resources

For the Years Ended September 30, 2023 and 2022 ($ in millions)

Item

FY 2023 FY 2022

Budgetary

Non-Budgetary 

Credit Reform 

Financing Accounts Budgetary

Non-Budgetary 

Credit Reform 

Financing Accounts

Budgetary Resources:

Unobligated Balance from Prior Year Budget Authority, Net 

(Discretionary and Mandatory)(Note 22) $ 162,779 $ 4,780 $ 115,631 $ 4,849

Appropriations (Discretionary and Mandatory) 287,253 19 293,956 3

Borrowing Authority (Discretionary and Mandatory) 13,298 16,382 11,978 17,050

Spending Authority from Offsetting Collections (Discretionary 

and Mandatory) 11,916 11,853 10,665 10,984

Total Budgetary Resources 475,246 33,034 432,230 32,886

Status of Budgetary Resources:

New Obligations and Upward Adjustments (Total) 297,840 22,077 276,458 22,057

Unobligated Balance, End of Year:

Apportioned, Unexpired Accounts 81,082 10,123 60,926 10,303

Exempt from Apportionment, Unexpired Accounts 46 — 276 —

Unapportioned, Unexpired Accounts 15,456 834 39,041 526

Unexpired Unobligated Balance, End of Year 96,584 10,957 100,243 10,829

Expired Unobligated Balance, End of Year 80,822 — 55,529 —

Unobligated Balance, End of Year (Total) 177,406 10,957 155,772 10,829

Total Budgetary Resources 475,246 33,034 432,230 32,886

Outlays, Net, and Disbursements, Net:

Outlays, Net (Total) (Discretionary and Mandatory) 232,446 251,031

Distributed Offsetting Receipts (-) (3,559) (5,796)

Agency Outlays, Net (Discretionary and Mandatory) (Note 25) $ 228,887 $ 245,235

Disbursements, Net (Total) (Mandatory) $ 5,628 $ 6,899

The accompanying notes are an integral part of these statements.
64 Section II | Financial Information

Notes to the Financial Statements

As of September 30, 2023, and 2022 ($ in millions)

NOTE 1: Summary of Significant Accounting Policies

Reporting Entity

USDA provides a wide variety of services in the United States and around the world. USDA is 

organized into eight distinct mission areas and their agencies that execute these missions, including 

staff offices for reporting listed below:

Farm Production and Conservation

• Farm Production and Conservation Business Center

• Farm Service Agency

• Commodity Credit Corporation

• Risk Management Agency

• Natural Resources Conservation Service

Food, Nutrition, and Consumer Services

• Food and Nutrition Service

Food Safety

• Food Safety and Inspection Service

Marketing and Regulatory Programs

• Agricultural Marketing Service

• Animal and Plant Health Inspection Service

Natural Resources and Environment

• Forest Service

Rural Development (Rural Housing Service, Rural Utility Service and Rural Business 

Cooperative Service)

Research, Education, and Economics 

• Agricultural Research Service

• National Agricultural Statistics Service

• National Institute of Food and Agriculture

• Economic Research Service

Trade and Foreign Agricultural Affairs

• Foreign Agricultural Service

▪ U.S. Codex Office

Staff Offices
USDA | 2023 Agency Financial Report 65

The Commodity Credit Corporation listed above is not separately identified in the Organization Chart 

but is a component required to prepare financial statements. The Office of the Chief Scientist is 

reported in staff offices for financial statements but is listed with the Under Secretary for Research, 

Education, and Economics in the USDA Organization Chart because the agencies that comprise the 

mission area fund its operations.

The reporting entity is a component of the U.S. Government. For this reason, some of the assets and 

liabilities reported by the entity may be eliminated for Government-wide reporting because they are 

offset by assets and liabilities of another U.S. Government entity. These financial statements should be 

read with the realization that they are for a component of the U.S. Government. See Note 26 for 

Disclosure Entities and Related Parties that are not part of consolidation.

Consolidation

The financial statements consolidate results of all agencies and staff offices. The effects of 

intradepartmental activity and balances are eliminated, except for the Statement of Budgetary 

Resources (SBR) which is presented on a combined basis. The financial statements are prepared in 

accordance with generally accepted accounting principles for the Federal Government.

Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that 

affect the amounts reported in the financial statements and accompanying notes. Actual results could 

differ from those estimates.

Fund Balance with Treasury (FBWT) and Funds from Dedicated Collections

FBWT is an asset of a reporting entity and a liability of the General Fund. Similarly, investments in 

Federal Government securities that are held by Dedicated Collections accounts are assets of the 

reporting entity responsible for the Dedicated Collections and liabilities of the General Fund. In both 

cases, the amounts represent commitments by the Government to provide resources for particular 

programs, but they do not represent net assets to the Government as a whole. 

When the reporting entity seeks to use FBWT or investments in Government securities to liquidate 

budgetary obligations, Treasury will finance the disbursements in the same way it finances all other 

disbursements, using some combination of receipts, other inflows, and borrowing from the public 

(if there is a budget deficit).

Revenue and Other Financing Sources

As a component of the Government-wide reporting entity, the entity is subject to the Federal budget 

process, which involves appropriations that are provided annually and appropriations that are provided 

on a permanent basis. The financial transactions that are supported by budgetary resources, which 
66 Section II | Financial Information

include appropriations, are generally the same transactions reflected in entity and the 

Government‐wide financial reports. 

The reporting entity’s budgetary resources reflect past congressional action and enable the entity to 

incur budgetary obligations, but they do not reflect assets to the Government as a whole. Budgetary 

obligations are legal obligations for goods, services, or amounts to be paid based on statutory 

provisions (e.g., Social Security benefits). After budgetary obligations are incurred, Treasury will make 

disbursements to liquidate the budgetary obligations.

Revenue from exchange transactions is recognized when persuasive evidence of an arrangement exists, 

delivery has occurred or services have been rendered, sales price is fixed or determinable, and collection 

is reasonably assured. In certain cases, the prices charged by the Department are set by law or 

regulation, which for program and other reasons may not represent full cost. Prices set for products and 

services offered through the Department’s working capital funds are intended to recover the full costs 

incurred by these activities. Revenue from non-exchange transactions is recognized when a specifically 

identifiable, legally enforceable claim to resources arises, to the extent that collection is probable and 

the amount is reasonably estimable. Appropriations are recognized as a financing source when used. An 

imputed financing source is recognized for costs subsidized by other Government entities.

Budgetary Terms

The purpose of Federal budgetary accounting is to control, monitor, and report on funds made 

available to Federal agencies by law and help ensure compliance with the law.

The following budget terms are commonly used:

Appropriation means a provision of law (not necessarily in an appropriations act) authorizing the 

expenditure of funds for a given purpose. Usually, but not always, an appropriation provides budget 

authority.

Budgetary resources mean amounts available to incur obligations in a given year. Budgetary resources 

consist of new budget authority and unobligated balances of budget authority provided in previous years. 

Offsetting collections mean payments to the Government that, by law, are credited directly to 

expenditure accounts and deducted from gross budget authority and outlays of the expenditure account, 

rather than added to receipts. Usually, offsetting collections are authorized to be spent for the purposes 

of the account without further action by Congress. They usually result from business-like transactions 

with the public, including payments from the public in exchange for goods and services, 

reimbursements for damages, and gifts or donations of money to the Government and from 

intragovernmental transactions with other Government accounts. The authority to spend offsetting 

collections is a form of budget authority.
USDA | 2023 Agency Financial Report 67

Offsetting receipts mean payments to the Government that are credited to offsetting receipt accounts 

and deducted from gross budget authority and outlays, rather than added to receipts. Usually they are 

deducted at the level of the agency and subfunction, but in some cases they are deducted at the level of 

the Government as a whole. They are not authorized to be credited to expenditure accounts. The 

legislation that authorizes the offsetting receipts may earmark them for a specific purpose and either 

appropriate them for expenditure for that purpose or require them to be appropriated in annual 

appropriations acts before they can be spent. Like offsetting collections, they usually result from 

business-like transactions with the public, including payments from the public in exchange for goods 

and services, reimbursements for damages, and gifts or donations of money to the Government, and 

from intragovernmental transactions with other Government accounts.

Obligation means a binding agreement that will result in outlays, immediately or in the future. 

Budgetary resources must be available before obligations can be incurred legally.

Outlay means a payment to liquidate an obligation (other than the repayment of debt principal or other 

disbursements that are "means of financing" transactions). Outlays generally are equal to cash 

disbursements but also are recorded for cash-equivalent transactions, such as the issuance of 

debentures to pay insurance claims, and in a few cases are recorded on an accrual basis such as interest 

on public issues of the public debt. Outlays are the measure of Government spending.

For further information about budget terms and concepts, see the "Budget Concepts" chapter of the 

Analytical Perspectives volume of the President’s Budget.

Investments

The Department is authorized to invest certain funds in excess of its immediate needs in Treasury 

securities. Investments in non-marketable par value Treasury securities are classified as held to 

maturity and are carried at cost. Investments in market-based Treasury securities are classified as held 

to maturity and are carried at amortized cost. The amortized cost of securities is based on the purchase 

price adjusted for amortization of premiums and accretion of discounts using the straight-line method 

over the term of the securities.

Accounts Receivable

Accounts receivable are reduced to net realizable value by an allowance for uncollectible accounts. 

The adequacy of the allowance is determined based on past experience and age of outstanding balances.

Direct Loans and Loan Guarantees

Direct loans obligated and loan guarantees committed after FY 1991 are reported based on the present 

value of the net cash-flows estimated over the life of the loan or guarantee. The difference between the 

outstanding principal of the loans and the present value of their net cash inflows is recognized as a 

subsidy cost allowance; the present value of estimated net cash outflows of the loan guarantees is 

recognized as a liability for loan guarantees. The subsidy expense for direct or guaranteed loans 
68 Section II | Financial Information

disbursed during the year is the present value of estimated net cash outflows for those loans or 

guarantees. A subsidy expense also is recognized for modifications made during the year to loans and 

guarantees outstanding and for reestimates made as of the end of the year to the subsidy allowances or 

loan guarantee liability for loans and guarantees outstanding.

Direct loans obligated and loan guarantees committed before FY 1992 are valued using either the 

present-value or net realizable methods. Under the present-value method, the outstanding principal of 

direct loans is reduced by an allowance equal to the difference between the outstanding principal and 

the present value of the expected net cash flows. The liability for loan guarantees is the present value 

of expected net cash outflows due to the loan guarantees. Under the net realizable value method, the 

average rate of the last five years of write-offs is used.

Inventories and Related Property

Commodity inventory, referred to as goods held under price support and stabilization programs in SFFAS 

No. 3, Accounting for Inventory and Related Property, issued by FASAB, represent commodities 

acquired by CCC for donation or price support purposes. Commodities are eventually sold or otherwise 

disposed of to help satisfy economic goals. Acquisition is generally made through commodity loan 

forfeitures, use of Commodity Certificate Exchange, or by purchase of commodities on the open market.

Inventory purchases are initially recorded at acquisition cost, including transportation, plus processing 

and packaging costs incurred after acquisition. Acquisition cost for loan forfeitures is the amount of the 

loan settlement, excluding interest. The commodity is revalued at the lower of cost or the net realizable 

value in accordance with SFFAS No. 3.

Commodity inventory is not held in reserve for future sale. All commodity inventory on hand at yearend is anticipated to be donated or transferred during the next fiscal year. CCC has no excess, obsolete 

or unserviceable inventory.

Property, Plant and Equipment (PP&E)

PP&E are stated at cost less accumulated depreciation. Depreciation is determined using the straightline method over the estimated useful lives of the assets. Useful lives for PP&E are disclosed in Note 

9. Capitalization thresholds for personal property and real property are $25,000; and $100,000 for 

internal use software. There are no restrictions on the use or convertibility of PP&E.

Pension and Other Retirement Benefits

Pension and other retirement benefits (primarily retirement health care benefits) expense is recognized 

at the time the employees’ services are rendered. The expense is equal to the actuarial present value of 

benefits attributed by the pension plan’s benefit formula, less the amount contributed by the 

employees. An imputed cost is recognized for the difference between the expense and contributions 

made by and for employees.
USDA | 2023 Agency Financial Report 69

Workers’ Compensation Benefits

The Federal Employees’ Compensation Act (FECA) provides wage replacement and medical cost 

protection to covered Federal civilian employees injured on the job, employees who have incurred a 

work-related occupational disease, and beneficiaries of employees whose death is attributable to a 

job‐related injury or occupational disease. The FECA program is administered by the U.S. Department 

of Labor (DOL), which initially pays valid claims and subsequently seeks reimbursement from the 

Federal agencies employing the claimants. DOL provides the actuarial liability for claims outstanding 

at the end of each fiscal year. This liability includes the estimated future costs of death benefits, 

workers’ wage replacement, medical, and miscellaneous costs for approved compensation cases.

Funds from Dedicated Collections

In accordance with SFFAS 43, Funds from Dedicated Collections which became effective October 1, 

2012, USDA has reported the funds from dedicated collections for which it has program management 

responsibility when the following three criteria are met: 1) a statute committing the Federal 

Government to use specifically identified revenues and/or other financing sources that are originally 

provided to the Federal Government by a non-Federal source only for designated activities, benefits or 

purposes; 2) explicit authority for the fund to retain revenues and/or other financing sources not used in 

the current period for future use to finance the designated activities, benefits, or purposes; and 3) a 

requirement to account for and report on the receipt, use, and retention of the revenues and/or other 

financing sources that distinguishes the fund from the Federal Government’s general revenues. 

Contingencies

Contingent liabilities are recognized when a past event or exchange transaction has occurred, a future 

outflow or other sacrifice of resources is probable, and the future outflow or sacrifice of resources is 

measurable.

Allocation Transfers

USDA is a party to allocation transfers with other Federal agencies as both a transferring (parent) 

entity and/or a receiving (child) entity. Allocation transfers are legal delegations by one department of 

its authority to obligate budget authority and outlay funds to another department. A separate fund 

account (allocation account) is created in the U.S. Treasury as a subset of the parent fund account for 

tracking and reporting purposes. All allocation transfers of balances are credited to this account, and 

subsequent obligations and outlays incurred by the child entity are charged to this allocation account as 

they execute the delegated activity on behalf of the parent entity.

USDA allocates funds, as the parent, to the Department of the Interior, Department of Defense, 

Department of Housing and Urban Development, Agency for International Development, and the 

Small Business Administration. USDA receives allocation transfers, as the child, from the Department 

of Labor, Department of Transportation, Department of the Interior, Agency for International 
70 Section II | Financial Information

Development, Economic Development Administration, Appalachian Regional Commission, and the 

Delta Regional Authority.

Inter-Entity Costs 

Goods and services are received from other Federal entities at no cost or at a cost less than the full cost 

to the providing Federal entity. Consistent with accounting standards, certain costs of the providing 

entity that are not fully reimbursed by the Department are recognized as imputed cost [in the Statement 

of Net Cost] and are offset by imputed revenue [in the Statement of Changes in Net Position]. Such 

imputed costs and revenues relate to business-type activities (if applicable), employee benefits, and 

claims to be settled by the Treasury Judgment Fund. However, unreimbursed costs of goods and 

services other than those identified above are not included in our financial statements.

Fiduciary Activities

Fiduciary activities are the collection or receipt, and the management, protection, accounting, 

investment, and disposition by the Federal Government of cash or other assets in which non-Federal 

individuals or entities have an ownership interest that the Federal Government must uphold. Fiduciary 

assets are not assets of the Federal Government and are not recognized on the balance sheet.

Asbestos-Related Cleanup Costs

Effective October 1, 2012, Technical Bulletin 2006-1, Recognition and Measurement of AsbestosRelated Cleanup Costs, as amended, requires an estimate of both friable and non-friable asbestos-related 

cleanup costs; recognition of a liability and related expense for those costs that are both probable and 

reasonably estimable; and disclosure of information related to friable and non‐friable asbestos-related 

cleanup costs that are probable but not reasonably estimable in a note to the financial statements. 

Deferred Maintenance and Repairs

Deferred maintenance and repairs are such that were not performed when they should have been or 

were scheduled to be and which are put off or delayed for a future period. Maintenance and repairs are 

activities directed toward keeping fixed assets in an acceptable condition. Activities include preventive 

maintenance; replacement of parts, systems, or components; and other activities needed to preserve or 

maintain the asset. Maintenance and repairs, as distinguished from capital improvements, exclude 

activities directed towards expanding the capacity of an asset or otherwise upgrading it to serve needs 

different from, or significantly greater than, its current use. SFFAS 42, Deferred Maintenance and 

Repairs became effective October 1, 2014. Estimates for deferred maintenance and repairs are 

disclosed in required supplementary information.
USDA | 2023 Agency Financial Report 71

Reconciliation of Net Cost to Net Outlays

SFFAS 53, Budget and Accrual Reconciliation (BAR) became effective October 1, 2018. The BAR 

explains the relationship between the entity’s net outlays on a budgetary basis and the net cost of 

operations during the reporting period.

Insurance Programs

The Federal Crop Insurance Program is considered a short-duration exchange transaction insurance 

program. The crop insurance policies insure against unexpected declines in yield and/or price due to 

natural causes. The insurance policies are structured as a contract between Approved Insurance 

Providers (AIPs) and producers, with the FCIC providing reinsurance to AIPs. Crop insurance policies 

automatically renew each year, unless producers cancel them by a published annual deadline. Under 

the reinsurance agreements, AIPs agree to deliver insurance products to eligible entities under certain 

terms and conditions. The administrative and operating subsidy compensates the AIPs for selling and 

servicing crop insurance policies, including the direct settling of claims. Producers pay a portion of 

premium and fees to participate in the insurance program benefit payments. FCIC and AIPs share in 

underwriting gains or losses. The underwriting risk for the crop insurance program is shared by FCIC 

and the AIPs. The AIPs generally retain approximately 80 to 85 percent of the premium, and the risk 

associated with the premium. FCIC provides AIPs stop-loss reinsurance for the risk associated with 

their retained premium.

Classified Activities

Accounting standards require all reporting entities to disclose that accounting standards allow certain 

presentations and disclosures to be modified, if needed, to prevent the disclosure of classified 

information.

Accounting Change

The Food and Nutrition Service improved financial accounting records by changing when it recognizes 

and records the obligation for Supplemental Nutrition Assistance Program (SNAP) benefits from the 

time recipients receive their Electronic Benefits Transfer (EBT) benefits to the point when funds are 

made available to the Federal Reserve Bank for benefits processing.

Reclassifications

Note 7: Loans Receivable, Net and Loan Guarantee Liabilities, Table 15: Loans Receivables, Net was 

reclassified to conform to OMB Circular A-136, Financial Reporting Requirements. Note 9: Property, 

Plant & Equipment (PP&E), Net was reclassified to disclose actual Useful Life (Years). Note 19: 

Commitments and Contingencies was reclassified to remove environmental and disposal liabilities 

disclosed in Note 15: Environmental and Disposal Liabilities.
72 Section II | Financial Information

Note Disclosures Related to the Balance Sheet

NOTE 2: Non-Entity Assets

Non-entity assets include proceeds from the sale of timber payable to the U.S. Treasury, timber 

contract performance bonds, employer contributions and payroll taxes withheld for agencies serviced 

by the National Finance Center, rural housing escrow, interest, fines, and penalties.

Item FY 2023 FY 2022

Intragovernmental Assets: 

 Fund Balance with Treasury $ 381 $ 379

 Accounts Receivable 552 323

Total Intragovernmental Assets 933 702

Cash and Other Monetary Assets 78 55

Accounts Receivable 578 408

Total Non-Entity Assets 1,589 1,165

Total Entity Assets 477,622 414,720

Total Assets $ 479,211 $ 415,885
USDA | 2023 Agency Financial Report 73

NOTE 3: Fund Balance with Treasury

Borrowing Authority Not Yet Converted to Fund Balance represents unobligated and obligated 

amounts recorded at year-end that will be funded by future borrowings. Non-Budgetary Fund Balance 

with Treasury includes special fund receipt accounts, and clearing and suspense account balances 

awaiting disposition or reclassification.

On September 30, 2022, CCC recorded non-expenditure transfers to outside agencies. Due to the 

timing of the transactions, the financing (executed borrowings from Treasury) for these transfers was 

not processed until the next business day, October 3, 2022, effective in FY 2023. As a result, CCC has 

recognized a liability (Due to the General Fund) related to the financing event that did not occur until 

FY 2023. This results in a discrepancy with balances reported to Treasury of $3,197 million as of 

September 30, 2022.

Item FY 2023 FY 2022

Status of Fund Balance with Treasury

Unobligated Balance

Available $ 91,251 $ 71,505

Unavailable 97,210 95,097

Obligated Balance Not Yet Disbursed 142,910 107,017

Borrowing Authority Not Yet Converted to Fund Balance (44,827) (47,175)

Authority Granted Prior to Credit Reform for Rental Assistance Grants (13) (15)

Non-Budgetary Fund Balance with Treasury 52,666 57,652

Total $ 339,197 $ 284,081

NOTE 4: Cash and Other Monetary Assets

For FY 2023 and FY 2022, cash and other monetary assets consists of Federal crop insurance escrow 

of $277 million and $398 million, deposits in transit of $33 million and $39 million, and single‐family 

housing escrow of $78 million and $55 million, respectively.

Item FY 2023 FY 2022

Cash $ 388 $ 492
74 Section II | Financial Information

NOTE 5: Investments, Net

FY 2023

Item Cost/ Acquisition 

Value

Amortization 

Method

Amortized 

(Premium) 

Discount

Interest 

Receivable

Net 

Investments Market Value

Intragovernmental Securities and Investments:

Non-marketable - Market-based $ 277 Straight Line $ 1 $ 2 $ 280 $ 266

Total Intragovernmental Securities and Investments 277 1 2 280 266

Fair Value Measurement of Non-Intragovernmental Investments Total

Equity Securities 3

Total Fair Value Measurement of Non-Intragovernmental Investments $ 3

FY 2022

Item Cost/ Acquisition 

Value

Amortization 

Method

Amortized 

(Premium) 

Discount

Interest 

Receivable

Net 

Investments Market Value

Intragovernmental Securities and Investments:

Non-marketable - Market-based $ 266 Straight Line $ 1 $ 1 $ 268 $ 255

Total Intragovernmental Securities and Investments 266 1 1 268 255

Fair Value Measurement of Non-Intragovernmental Investments Total

Equity Securities 3

Total Fair Value Measurement of Non-Intragovernmental Investments $ 3
USDA | 2023 Agency Financial Report 75

Fair value measurement of non-intragovernmental investments include equity securities held by the 

Alternative Agricultural Research and Commercialization Corporation (AARCC). These securities 

represent shares the AARCC program purchased as part of the original investment into non-publicly 

traded companies. The program along with the investments is currently going through a review process 

with regards to the viability of the remaining investments and their value.

The U. S. Treasury does not set aside assets to pay future expenditures associated with funds from 

dedicated collections; instead the cash generated from funds from dedicated Treasury securities are 

issued to the funds from dedicated collections as evidence of the dedicated receipts; Treasury securities 

held by the funds for dedicated collections are an asset of the fund(s) and a liability of the U. S. Treasury, 

and will be eliminated by consolidation in the U. S. Government-wide financial statements; and when the 

funds from dedicated collections redeems their Treasury securities to make expenditures, the U. S. 

Treasury will finance those expenditures in the same manner that it finances all other expenditures.

NOTE 6: Accounts Receivable, Net

FY 2023

Item

Accounts Receivable, 

Gross

Allowance for 

Uncollectible Accounts

Accounts Receivable, 

Net

Intragovernmental $ 606 $ — $ 606

Other than Intragovernmental 7,372 (73) 7,299

Total $ 7,978 $ (73) $ 7,905

FY 2022

Item

Accounts Receivable, 

Gross

Allowance for 

Uncollectible Accounts

Accounts Receivable, 

Net

Intragovernmental $ 495 $ — $ 495

Other than Intragovernmental 6,770 (64) 6,706

Total $ 7,265 $ (64) $ 7,201

NOTE 7: Loans Receivable, Net and Loan Guarantee 

Liabilities

Direct loan obligations and loan guarantee commitments made after fiscal year 1991, and the resulting 

direct loans or loan guarantees, are governed by the Federal Credit Reform Act of 1990, as amended.

Direct loan obligations or loan guarantee commitments made pre-1992 are reported at either net 

present-value or net realizable value. 

The net present value of Direct Loan and Loan Guarantees, Net is not necessarily representative of the 

proceeds that might be expected if these loans were sold on the open market.
76 Section II | Financial Information

The Department offers direct and guaranteed loans through credit programs in the FPAC mission area 

through the FSA and the CCC, and in the RD mission area. 

Farm Production and Conservation Mission Area

The FPAC mission area helps keep America’s farmers and ranchers in business as they face the 

uncertainties of weather and markets. FPAC delivers commodity, credit, conservation, disaster, and 

emergency assistance programs that help strengthen and stabilize the agricultural economy. FPAC 

contributes to the vitality of the farm sector with programs that encourage the expansion of export 

markets for U.S. agriculture. 

FSA offers direct and guaranteed loans to farmers who are temporarily unable to obtain private, 

commercial credit, and nonprofit entities that are engaged in the improvement of the nation’s 

agricultural community. Often, FSA borrowers are beginning farmers who cannot qualify for 

conventional loans due to insufficient financial resources. Additionally, the agency helps established 

farmers who have suffered financial setbacks from natural disasters or have limited resources to 

maintain profitable farming operations. FSA officials also provide borrowers with supervision and 

credit counseling.

FSA’s mission is to provide supervised credit. FSA works with each borrower to identify specific 

strengths and weaknesses in farm production and management, and provides alternatives to address 

weaknesses. FSA is able to provide certain loan servicing options to assist borrowers whose accounts 

are distressed or delinquent. These options include reamortization, restructuring, loan deferral, 

lowering interest rates, acceptance of easements, and debt write-downs. The eventual goal of FSA’s 

farm credit programs is to graduate its borrowers to commercial credit.

CCC’s foreign programs provide economic stimulus to both the U.S. and foreign markets, while giving 

humanitarian assistance to the most disadvantaged people throughout the world. CCC offers both 

credit guarantee and direct credit programs for buyers of U.S. exports, suppliers, and sovereign 

countries in need of food assistance.

CCC permits debtor nations to reschedule debt under the aegis of the Paris Club. The Paris Club is an 

informal group of official creditors whose role is to facilitate debt treatments based on an 

internationally recognized set of rules and principles, facilitated by the senior officials of the French 

Treasury. Its sole purpose is to assess, on a case-by-case basis, liquidity problems faced by 

economically disadvantaged countries. The general premise of Paris Club is to provide disadvantaged 

nations short-term liquidity relief to enable them to reestablish their credit worthiness. The U.S. 

Departments of State and Treasury lead the U.S. Delegation and negotiations for all U.S. agencies.

CCC also provides loans for farm and sugar storage facilities through the Farm Storage Facility Loan 

Program (FSFL). FSFL provides low interest financing for producers to build or upgrade farm storage 

and handling facilities. FSFL program regulations were amended during FY 2017 to add eligibility for 

portable storage structures, portable equipment, and storage and handling trucks, and to reduce the 

down payment and documentation requirements for a “microloan” category of FSFLs up to $50,000.
USDA | 2023 Agency Financial Report 77

Exhibit 13: Farm Production and Conservation List of Direct Loan and Loan Guarantee Programs

Farm Service Agency Commodity Credit Corporation

Direct Farm Ownership

Direct Farm Operating

Direct Emergency Loans

Direct Indian Land Acquisition

Direct Boll Weevil Eradication

Direct Seed Loans to Producers

Direct Conservation

Guaranteed Farm Operating Subsidized/Unsubsidized

Guaranteed Farm Ownership Unsubsidized

Guaranteed Conservation

American Recovery and Reinvestment Fund 

General Sales Manager Export Credit Guarantee 

Program

Facility Program Guarantee

Public Law (P.L.) 480 Title 1 Program

Direct Farm Storage Facility

Direct Sugar Storage Facilities

Rural Development Mission Area

RD offers both direct and guaranteed loans administered through three agencies with unique missions to 

bring prosperity and opportunity to rural areas. Each year, RD programs create or preserve tens of 

thousands of rural jobs and provide or improve the quality of rural housing, business, and utilities. 

To leverage the impact of its programs, RD is working with State, local, and Tribal Governments, as well 

as private and nonprofit organizations and user-owned cooperatives. RD is able to provide certain loan 

servicing options to borrowers whose accounts are distressed or delinquent. These options include 

reamortization, restructuring, loan deferral, lowering interest rate, acceptance of easements, and debt 

write-downs. The choice of servicing options depends on the loan program and the individual borrower. 

Rural Housing programs provide affordable, safe, and sanitary housing and essential community 

facilities to rural communities. They also help finance new or improved housing for moderate, low, and 

very low-income families each year. Other programs help rural communities to finance, construct, 

enlarge or improve fire stations, libraries, hospitals and medical clinics, industrial parks, and other 

community facilities. 

Rural Business programs promote a dynamic business environment in rural America. These programs 

work in partnership with the private sector and community-based organizations to provide financial 

assistance and business planning. They also provide technical assistance to rural businesses and 

cooperatives, conduct research into rural economic issues, and provide cooperative educational 

materials to the public. 

Rural Utilities programs help to improve the quality of life in rural America through a variety of loan 

programs for electric energy, telecommunications, and water and environmental projects. These 

programs leverage scarce Federal funds with private capital for investing in rural infrastructure, 

technology, and development of water resources.
78 Section II | Financial Information

Exhibit 14: Rural Development List of Direct Loan and Loan Guarantee Programs

Rural Housing Program Rural Business Program Rural Utilities Program

Single Family Housing Direct 

Loans (including Self-Help 

Loans)

Single Family Housing Loan 

Guarantees

Single Family Housing Repair 

Loans

Rural Rental Housing Direct Loan

Rural Rental Housing Loan 

Guarantees

Farm Labor Housing Loans

Community Facilities Direct 

Loans and Loan Guarantees

Business and Industry Loan 

Guarantees

Intermediary Relending Program 

Loans

Rural Microentrepreneur Assistance 

Program 

Rural Economic Development 

Loans

Rural Energy for America Program 

Loan Guarantees

Biorefinery Renewable Chemical, 

and Bio-based Product 

Manufacturing Assistance Program 

Loan Guarantees 

Water and Environmental Direct 

Loans, Loan Guarantees

Rural Broadband Direct Loans 

Electric and Telecommunications 

Direct Loans and Loan 

Guarantees

Loan Modifications

Multi-Family Housing direct loan modifications related to the revitalization program, which began in 

FY 2006, continued through FY 2023. In this program, RD provides restructured loans and grants to 

development owners to revitalize multi-family housing development projects in order to extend the 

affordable use without displacing tenants due to the increased rent.

Payments to distressed borrowers and associated modifications for the Agricultural Credit Insurance 

Fund were authorized by the Inflation Reduction Act Section 22006 for loan programs authorized by the 

Consolidated Farm and Rural Development Act, subtitles A, B, and C (farm ownership, farm operating, 

and emergency). Total funding is $3.1 billion for both payments and modification costs and is available 

until FY 2031. Approximately two-thirds of the funding was obligated during FY 2023.

The Debt Reduction Fund is used to account for CCC’s “modified debt.” Debt is considered to be 

modified if the original debt has been reduced or the interest rate of the agreement changed. 

In contrast, when debt is “rescheduled,” only the date of payment is changed. Rescheduled debt is 

carried in the original fund until paid. With one exception, all outstanding CCC modified debt is 

carried in the Debt Reduction Fund and is governed by the Federal Credit Reform Act of 1990, as 

amended. CCC modified debt for several P.L. 480 loans in the direct financing and liquidating 

accounts during FY 2022. 
USDA | 2023 Agency Financial Report 79

Foreclosed Property

As of September 30, 2023 and 2022, foreclosed property consisted of 262 and 307 rural single-family 

housing dwellings, with an average holding period of 17 months for FY 2023 and FY 2022, 

respectively. As of September 30, 2023 and 2022, FSA-Farm Loan Program properties consist 

primarily of 134 and 125 farms, respectively. The average holding period for these properties in 

inventory for FY 2023 and FY 2022 was 92 and 89 months, respectively. The approximate number of 

borrowers for which foreclosure proceedings were in process at the end of FY 2023 and FY 2022 was 

9,635 and 10,143, respectively. Certain properties can be leased to eligible individuals.

Other Information

Non-performing loans are defined as receivables that are in arrears by 90 or more days or are on 

rescheduling agreements until such time two consecutive payments have been made following the 

rescheduling. When RD, FSA and CCC calculate loan interest income, however, the recognition of 

revenue is deferred. Late interest is accrued on arrears. 

Approximately $12,938 million and $12,949 million of Rural Housing borrowers’ unpaid loan 

principal as of September 30, 2023 and 2022 were receiving interest credit. If those loans receiving 

interest credit had accrued interest at the full‐unreduced rate, interest income would have been 

approximately $568 million and $592 million higher for FY 2023 and FY 2022, respectively.

At the end of FY 2023 and FY 2022, the RD portfolio contained approximately 45,802 and 50,050 

restructured loans with an outstanding unpaid principal balance of $3,072 million and $3,331 million, 

respectively. At the end of FY 2023 and FY 2022, the farm loan portfolio contained approximately 

11,734 and 12,508 restructured loans with an outstanding unpaid principal balance of $992 million and 

$1,086 million, respectively. Direct credit and credit guarantee principal receivables in the food aid and 

export programs under rescheduling agreements as of September 30, 2023 and 2022, were 

$823 million and $923 million, respectively.

Beginning in FY 2012, advance payments surpassed the loans receivable balance in the Rural Utilities 

Liquidating Fund. This was due to an increased volume in advance payments and a normal reduction to 

the Liquidating Portfolio. The Omnibus Budget Act of 1987, section 313, authorized the accumulation 

of Cushion of Credit (CoC) in the Revolving Fund. Borrowers were able to make advance payments up 

to their liquidating and financing total Rural Utilities Service debt. The enactment of the 2018 

Agriculture Improvement Act had provided the borrowers the opportunity to prepay outstanding loans 

using the CoC balances without penalty through September 30, 2020. As of September 30, 2020 the 

CoC account is no longer accepting borrower deposits and the remaining balances are used to repay 

outstanding loan balances. To accurately represent the value of Electric and Telecommunication assets, 

RD reports the CoC amounts as a separate line item in Tables 1 and 2.
80 Section II | Financial Information

Table 1: Direct Loans Obligated Prior to FY 1992

FY 2023 Direct Loan Programs Loans 

Receivable, 

Gross

Interest 

Receivable

Foreclosed 

Property

Present Value 

Allowance

Direct Loans, 

Net

Farm $ 72 $ 33 $ 7 $ (35) $ 77

Food Aid 175 5 — (75) 105

Housing 4,802 843 3 (778) 4,870

Community Facility 4 — — — 4

Electric 187 2 — — 189

Telecommunications 14 — — — 14

Water and Environmental 120 — — — 120

Cushion of Credit (5) — — — (5)

Total $ 5,369 $ 883 $ 10 $ (888) $ 5,374

FY 2022 Direct Loan Programs Loans 

Receivable, 

Gross

Interest 

Receivable

Foreclosed 

Property

Present Value 

Allowance

Direct Loans, 

Net

Farm $ 114 $ 87 $ 7 $ (84) $ 124

Food Aid 208 4 — (73) 139

Housing 5,078 784 1 (712) 5,151

Community Facility 5 — — — 5

Electric 1,643 2 — (1,427) 218

Telecommunications 20 — — — 20

Water and Environmental 137 2 — — 139

Intermediary Relending 1 — — — 1

Cushion of Credit (54) — — — (54)

Total $ 7,152 $ 879 $ 8 $ (2,296) $ 5,743
USDA | 2023 Agency Financial Report 81

Table 2: Direct Loans Obligated Post-1991

FY 2023 Direct Loan Programs

Loans 

Receivable, 

Gross

Interest and 

Fees Receivable

Foreclosed 

Property

Allowance for 

Subsidy Cost 

(Present Value)

Direct Loans, 

Net

Farm $ 16,564 $ 281 $ 9 $ 168 $ 17,022

Food Aid 306 6 — (51) 261

Housing 17,810 460 20 (1,416) 16,874

Community Facility 11,975 74 — (252) 11,797

Electric 56,352 218 — 655 57,225

Telecommunications 2,275 6 — (12) 2,269

Water and Environmental 13,529 65 — 167 13,761

Intermediary Relending 288 1 — (49) 240

Business and Industry 41 — — (2) 39

Economic Development 207 — — (10) 197

Cushion of Credit (269) — — — (269)

Total $ 119,078 $ 1,111 $ 29 $ (802) $ 119,416

FY 2022 Direct Loan Programs

Loans 

Receivable, 

Gross

Interest and 

Fees Receivable

Foreclosed 

Property

Allowance for 

Subsidy Cost 

(Present Value)

Direct Loans, 

Net

Farm $ 16,124 $ 363 $ 9 $ 180 $ 16,676

Food Aid 369 9 — (88) 290

Housing 17,156 444 23 (1,183) 16,440

Community Facility 11,550 110 — (228) 11,432

Electric 52,251 31 — (737) 51,545

Telecommunications 2,418 2 — (38) 2,382

Water and Environmental 13,090 83 — 303 13,476

Intermediary Relending 302 2 — (58) 246

Business and Industry 42 — — (5) 37

Economic Development 177 — — (12) 165

Cushion of Credit (491) — — — (491)

Total $ 112,988 $ 1,044 $ 32 $ (1,866) $ 112,198

Table 3: Total Amount of Direct Loans Disbursed (Post-1991)

Direct Loan Programs

FY 2023 FY 2022

Farm $ 2,973 $ 3,036

Housing 1,657 1,125

Community Facility 823 946

Electric 6,350 5,749

Telecommunications 185 181

Water and Environmental 866 1,005

Intermediary Relending 16 10

Business and Industry 3 2

Economic Development 66 22

Total $ 12,939 $ 12,076
82 Section II | Financial Information

Table 4: Subsidy Expense for Direct Loan Programs by Component

FY 2023 Direct Loan Programs

Interest 

Differential Defaults

Fees and 

Other 

Collections Other

Subtotal 

Subsidy

Total 

Modifications

Interest Rate 

Reestimates

Technical 

Reestimates

Total 

Reestimates

Total Subsidy 

Expense

Farm $ (30) $ 36 $ (1) $ 3 $ 8 $ (10) $ 502 $ (542) $ (40) $ (42)

Export — — — — — — 9 (52) (43) (43)

Food Aid — — — — — — — 10 10 10

Housing 10 69 — (12) 67 2 61 148 209 278

Community Facility (97) 33 — 15 (49) — 3 63 66 17

Electric (192) 20 (24) (27) (223) — (506) (534) (1,040) (1,263)

Telecommunications — 20 — — 20 — 9 (56) (47) (27)

Water and Environmental 36 1 — (30) 7 — — 201 201 208

Intermediary Relending 2 — — — 2 — 25 (31) (6) (4)

Business and Industry — — — — — — 4 (6) (2) (2)

Economic Development 5 — — — 5 — 14 (18) (4) 1

Total $ (266) $ 179 $ (25) $ (51) $ (163) $ (8) $ 121 $ (817) $ (696) $ (867)

FY 2022 Direct Loan Programs

Interest 

Differential Defaults

Fees and 

Other 

Collections Other

Subtotal 

Subsidy

Total 

Modifications

Interest Rate 

Reestimates

Technical 

Reestimates

Total 

Reestimates

Total Subsidy 

Expense

Farm $ (23) $ 38 $ (1) $ 2 $ 16 $ — $ 481 $ (687) $ (206) $ (190)

Export — — — — — — 206 (184) 22 22

Food Aid — — — — — — — 15 15 15

Housing 3 48 — (4) 47 — (135) (380) (515) (468)

Community Facility (107) 36 — 15 (56) — (99) 165 66 10

Electric (203) 16 (19) (22) (228) — (1,413) 2,295 882 654

Telecommunications — 18 — (1) 17 3 49 6 55 75

Water and Environmental 47 1 — (33) 15 — 53 132 185 200

Intermediary Relending 2 — — — 2 — — — — 2

Business and Industry — — — — — — — (1) (1) (1)

Economic Development 2 — — — 2 — (4) — (4) (2)

Total $ (279) $ 157 $ (20) $ (43) $ (185) $ 3 $ (862) $ 1,361 $ 499 $ 317
USDA | 2023 Agency Financial Report 83

The following is a discussion of events and changes that had significant and measurable effect on the 

subsidy expense, reestimates, and allowances.

The Housing program has an upward reestimate of $209 million. The key drivers of the upward impact 

were the updated full and partial payoff prepayments, subsidy interest, recaptures, and other outflows 

from FY 2022. The forecasted recapture recoveries decreased which resulted in an upward impact on 

the total reestimate amount. Another driver of the overall upward reestimate was an increase in full and 

partial prepayments and other outflows which resulted in an upward impact.

The Electric program had an overall downward reestimate of $(1,040) million, which is comprised of a 

$(970) million downward reestimate in the FFB program, a $(55) million downward reestimate in the 

FFB Underwriter program, and a downward reestimate of $(42) million in the FFB Electric 

Modification program. Those downward reestimates were offset by a $14 million upward reestimate in 

the Electric Municipal program, $13 million upward reestimate in the Electric Treasury. The main 

driver for the downward reestimate in the Direct Electric FFB program was the increase in forecasted 

interest payments and inflows due to updated data from FY2022. The main driver in the downward 

reestimate in the FFB Underwriter program was a model update to expand the model’s functionality to 

include new amortization types, prepayments, and updating the credit ratings by advance.

The Direct Water and Waste Disposal program had an overall upward reestimate of $201 million. 

The main driver for the overall upward reestimate was less projected interest payments and inflows, as 

well as an increase in projected losses due to updated data from FY 2022.
84 Section II | Financial Information

Table 5: Subsidy Rates for Direct Loans by Program and Component (percentage)

FY 2023 Direct Loan Programs

Interest 

Differential Defaults

Fees and Other 

Collections Other Total

Farm Ownership (7.38) 0.44 — 0.25 (6.69)

Farm Operating (3.17) 4.23 — 0.38 1.44

Emergency Disaster (4.17) 10.03 — 0.27 6.13

Indian Tribe Land Acquisition (37.74) — — — (37.74)

Boll Weevil Eradication (0.48) — — (0.14) (0.62)

Indian Highly Fractionated Land 18.19 0.64 — (0.95) 17.88

Heirs Property Relending Program 18.19 0.64 — (0.95) 17.88

Farm Storage Facility Loan (0.99) — (0.27) (0.05) (1.31)

Sugar Storage Facility Loan Program (2.88) — — 0.01 (2.87)

Community Facility Loans (13.56) 4.45 — 1.65 (7.46)

Section 502 Single-Family Housing 0.04 4.52 — (0.85) 3.71

Section 515 Multi-Family Housing 19.53 1.25 — (1.67) 19.11

Section 504 Housing Repair 11.73 (0.03) — (3.40) 8.30

Section 514 Farm Labor Housing 20.69 0.17 — (0.44) 20.42

Section 524 Site Development (0.06) 3.77 — 0.45 4.16

Section 523 Self-Help Housing 0.42 4.84 — 0.07 5.33

Single-Family Housing Credit Sales (7.91) 2.82 — 1.52 (3.57)

Multi-Family Housing Revitalization Seconds 48.30 0.63 — (0.04) 48.89

Multi-Family Housing Revitalization Zero 43.35 0.48 — (0.27) 43.56

Native American Single Family Relending Pilot 24.86 9.93 — (1.89) 32.90

Rural Microenterprise Direct Loans 2.68 2.66 — — 5.34

Intermediary Relending Program 17.17 1.67 — (1.30) 17.54

Rural Economic Development Loans 10.31 0.01 — (0.45) 9.87

Water and Waste Disposal Loans 3.03 0.16 — (5.38) (2.19)

Water and Waste 1% 25.04 0.14 — (11.56) 13.62

Treasury Electric Loans — — — (2.96) (2.96)

FFB Electric Loans (4.73) 0.01 — (1.15) (5.87)

Treasury Telecommunications Loans 0.05 0.61 — (0.12) 0.54

FFB Guaranteed Underwriting — 1.26 (1.82) — (0.56)

Rural Energy Savings Program 9.94 0.79 — (0.37) 10.36

IRA Section 22001 35.88 0.01 — (0.28) 35.61

Broadband Treasury Loans 0.04 14.02 — (0.43) 13.63

Reconnect Direct Loans 4.27 10.05 — (0.68) 13.64

Reconnect Grant Assisted Loans — 10.05 — 0.05 10.10

The subsidy rates disclosed pertain only to the current year’s cohorts. These rates cannot be applied to 

the direct loans disbursed during the current reporting year to yield the subsidy expense. The subsidy 

expense for new loans reported in the current year could result from disbursements of loans from both 

current year cohorts and prior year(s) cohorts. The subsidy expense reported in the current year also 

includes modifications and reestimates.
USDA | 2023 Agency Financial Report 85

Table 6: Schedule for Reconciling Subsidy Cost Allowance Balances (Post-1991 Direct Loans)

Item FY 2023 FY 2022

Beginning Balance of the Subsidy Cost Allowance $ 2,841 $ 3,739

Add: Total Subsidy Expense for Direct Loans Disbursed During the Year As Shown in Table 4 (163) (185)

Adjustments

Loan Modifications (194) 3

Fees Received 82 84

Loans Written Off (140) (214)

Subsidy Allowance Amortization (101) (19)

Other 62 (1,066)

Ending Balance of the Subsidy Cost Allowance Before Reestimates 2,387 2,342

Add or Subtract Total Subsidy Reestimates As Shown in Table 4 (696) 499

Ending Balance of the Subsidy Cost Allowance $ 1,691 $ 2,841

Table 7: Defaulted Guaranteed Loans from Post-1991 Guarantees

FY 2023 Loan Guarantee Programs Defaulted Guaranteed 

Loans Receivable, Gross

Interest and Fees 

Receivable Foreclosed Property

Allowance for Subsidy Cost 

(Present Value)

Value of Assets Related to 

Defaulted Guaranteed 

Loans Receivable, Net

Farm $ 133 $ 39 $ — $ (136) $ 36

Export 128 2 — (15) 115

Housing 664 — — (629) 35

Community Facility 10 — — — 10

Business and Industry 396 — — (109) 287

Total $ 1,331 $ 41 $ — $ (889) $ 483

FY 2022 Loan Guarantee Programs Defaulted Guaranteed 

Loans Receivable, Gross

Interest and Fees 

Receivable Foreclosed Property

Allowance for Subsidy Cost 

(Present Value)

Value of Assets Related to 

Defaulted Guaranteed 

Loans Receivable, Net

Farm $ 280 $ 106 $ — $ (382) $ 4

Export 347 11 — (223) 135

Housing 348 — — (309) 39

Community Facility 5 — — — 5

Business and Industry 192 — — (62) 130

Total $ 1,172 $ 117 $ — $ (976) $ 313
86 Section II | Financial Information

Table 8: Guaranteed Loans Outstanding

FY 2023 Loan Guarantee Programs Pre-1992 Outstanding 

Principal, Face Value

Post-1991 Outstanding 

Principal, Face Value

Total Outstanding 

Principal, Face Value

Pre-1992 Outstanding 

Principal, Guaranteed

Post-1991 Outstanding 

Principal, Guaranteed

Total Outstanding 

Principal, Guaranteed

Farm $ — $ 18,460 $ 18,460 $ — $ 16,793 $ 16,793

Export — 2,798 2,798 — 2,735 2,735

Housing — 113,024 113,024 — 101,685 101,685

Community Facility — 1,288 1,288 — 1,121 1,121

Electric — 122 122 — 122 122

Water and Environmental — 111 111 — 97 97

Business and Industry — 11,367 11,367 — 8,478 8,478

Total $ — $ 147,170 $ 147,170 $ — $ 131,031 $ 131,031

FY 2022 Loan Guarantee Programs Pre-1992 Outstanding 

Principal, Face Value

Post-1991 Outstanding 

Principal, Face Value

Total Outstanding 

Principal, Face Value

Pre-1992 Outstanding 

Principal, Guaranteed

Post-1991 Outstanding 

Principal, Guaranteed

Total Outstanding 

Principal, Guaranteed

Farm $ — $ 18,879 $ 18,879 $ — $ 17,140 $ 17,140

Export — 3,210 3,210 — 3,136 3,136

Housing — 116,252 116,252 — 105,061 105,061

Community Facility — 1,193 1,193 — 1,055 1,055

Electric — 131 131 — 131 131

Water and Environmental — 111 111 — 98 98

Business and Industry — 9,948 9,948 — 7,506 7,506

Total $ — $ 149,724 $ 149,724 $ — $ 134,127 $ 134,127

Table 9: New Guaranteed Loans Disbursed

Loan Guarantee Programs

FY 2023 FY 2022

Principal, Face Value 

Disbursed

Principal, Guaranteed 

Disbursed

Principal, Face Value 

Disbursed

Principal, Guaranteed 

Disbursed

Farm $ 2,013 $ 1,831 $ 3,256 $ 2,956

Export 2,913 2,847 3,292 3,217

Housing 7,157 6,441 14,060 12,654

Community Facility 147 129 174 154

Water and Environmental 14 13 12 10

Business and Industry 2,564 1,998 2,119 1,625

Total $ 14,808 $ 13,259 $ 22,913 $ 20,616
USDA | 2023 Agency Financial Report 87

Table 10: Liability for Loan Guarantees (Present Value)

FY 2023 Loan Guarantee Programs Liabilities for Losses on Pre- 1992 

Guarantees Present Value

Liabilities for Post- 1991 Guarantees 

Present Value Liabilities for Loan Guarantees

Farm $ — $ 151 $ 151

Export — 9 9

Housing — (2,840) (2,840)

Community Facility — 16 16

Water and Environmental — 1 1

Business and Industry — 338 338

Total $ — $ (2,325) $ (2,325)

FY 2022 Loan Guarantee Programs Liabilities for Losses on Pre- 1992 

Guarantees Present Value

Liabilities for Post- 1991 Guarantees 

Present Value Liabilities for Loan Guarantees

Farm $ — $ 141 $ 141

Export — 14 14

Housing — (2,538) (2,538)

Community Facility — 24 24

Water and Environmental — 1 1

Business and Industry — 419 419

Total $ — $ (1,939) $ (1,939)

Table 11: Subsidy Expense for Loan Guarantees by Program and Component

FY 2023 Loan Guarantee Programs

Interest 

Supplement Defaults

Fees and Other 

Collections Other Subtotal

Total 

Modifications

Interest Rate 

Reestimates

Technical 

Reestimates

Total 

Reestimates

Total Subsidy 

Expense

Farm $ — $ 54 $ (51) $ — $ 3 $ (229) $ (38) $ (22) $ (60) $ (286)

Export — — 14 (8) 6 — — (7) (7) (1)

Housing — 246 (309) — (63) — (5) (182) (187) (250)

Community Facility — 5 (6) — (1) — (2) (5) (7) (8)

Business and Industry — 154 (90) — 64 — (5) (110) (115) (51)

Total $ — $ 459 $ (442) $ (8) $ 9 $ (229) $ (50) $ (326) $ (376) $ (596)

FY 2022 Loan Guarantee Programs

Interest 

Supplement Defaults

Fees and Other 

Collections Other Subtotal

Total 

Modifications

Interest Rate 

Reestimates

Technical 

Reestimates

Total 

Reestimates

Total Subsidy 

Expense

Farm $ — $ 15 $ (9) $ — $ 6 $ — $ (5) $ (33) $ (38) $ (32)

Export — — 15 (3) 12 — — (1) (1) 11

Housing — 482 (677) — (195) — (120) (1,291) (1,411) (1,606)

Community Facility — 7 (5) — 2 — — (6) (6) (4)

Business and Industry — 124 (85) — 39 — (8) 53 45 84

Total $ — $ 628 $ (761) $ (3) $ (136) $ — $ (133) $ (1,278) $ (1,411) $ (1,547)
88 Section II | Financial Information

The following is a discussion of events and changes that had significant and measurable effect on the 

subsidy expense, reestimates, and allowances.

The Guaranteed Housing program has an overall downward reestimate of $(187) million. Majority of 

the downward reestimate is attributed to the Guaranteed Single-Family Housing Section 502 program. 

The downward reestimate of $(184) million in the Blended component of the program and a downward 

reestimate of $(18) million in the Purchase component. The majority of the total reestimate is 

explained by the Blended component’s change, which is attributed to a decrease in forecasted default 

claims. These changes were driven by the updated borrower source data which created an improved 

macroeconomic outlook. The downward reestimates in the Guaranteed Single-Family Housing Section 

502 program were offset by an upward reestimate of $15 million in the Guaranteed Multi-Family 

Section 538 Housing program.

The Guaranteed Business and Industry program has an overall downward reestimate of $(115) million. 

Majority of the downward reestimates are attributed to the Guaranteed Business and Industry program 

which had an overall downward reestimate of $(84) million. The Guaranteed Renewable Energy 

program has a downward reestimate of $(22) million and the Guaranteed Biorefinery program had a 

downward reestimate of $(9) million. The cause of the downward reestimates is attributable to the 

update of the coefficients in the model to project defaults.

Table 12: Subsidy Rates for Loan Guarantees by Program and Component (percentage)

FY 2023 Guaranteed Loan Programs

Interest 

Supplements Defaults

Fees and 

Other 

Collections Other Total

Food Processing Supply Chain Loan Guarantees — 6.91 — — 6.91

Farm Ownership—Unsubsidized — 0.75 (1.18) — (0.43)

Farm Operating—Unsubsidized — 1.69 (1.17) — 0.52

Conservation—Guaranteed — 0.62 (1.16) — (0.54)

GSM 102 — 0.24 (0.50) — (0.26)

Export Guarantee Program—Facilities — 0.62 (2.39) — (1.77)

Community Facility Loan Guarantees — 3.38 (4.04) — (0.66)

Guaranteed 538 Multi-Family Housing — 2.08 (5.05) — (2.97)

Guaranteed 502 Single-Family Housing — 3.45 (4.21) — (0.76)

Business and Industry Loan Guarantees — 6.41 (4.27) — 2.14

Renewable Energy Loan Guarantees — 2.59 (2.50) — 0.09

Section 9003 Loan Guarantees — 37.35 (4.56) 0.18 32.97

Water and Waste Disposal Loans — 0.86 (0.88) (0.02)

The subsidy rates disclosed pertain only to the current year’s cohorts. These rates cannot be applied to 

the guarantees of loans disbursed during the current reporting year to yield the subsidy expense. 

The subsidy expense for new loan guarantees reported in the current year could result from 

disbursements of loans from both current year cohorts and prior year(s) cohorts. The subsidy expense 

reported in the current year also includes modifications and reestimates.
USDA | 2023 Agency Financial Report 89

Table 13: Schedule for Reconciling Loan Guarantee Liability Balances 

(Post-1991 Loan Guarantees)

Item FY 2023 FY 2022

Beginning Balance of the Loan Guarantee Liabilities $ (1,939) $ (601)

Less Claim Payments to Lenders 181 130

Add Fees Received 579 658

Less Interest Supplements Paid 7 8

Add Foreclosed Property and Loans Acquired 29 61

Add Subsidy Expense 73 59

Less Negative Subsidy Payments 70 203

Add Upward Reestimate (7) 44

Less Downward Reestimates 369 1,455

Loan Guarantee Modifications 4 —

Other (437) (364)

Ending Balance of the Loan Guarantee Liabilities $ (2,325) $ (1,939)

Table 14: Administrative Expenses

Item FY 2023 FY 2022

Direct Loan Programs $ 584 $ 521

Guaranteed Loan Programs 481 449

Total $ 1,065 $ 970

Table 15: Loans Receivable, Net

Item FY 2023 FY 2022

Beginning Balance of Loans Receivable, Net $ 118,254 $ 113,057

Add: Loan disbursements 13,934 13,161

Less: Principal and interest payments received 7,847 8,523

Add: Interest accruals 22 19

Less: Fees received 82 2

Add: Foreclosed property acquired — 24

Less: Sale of foreclosed property 25 54

Less: Loans written off 97 240

Less: Subsidy expense 99 109

Add: Negative subsidy payments 423 496

Less: Upward reestimates 1,517 1,276

Add: Downward reestimates 2,229 1,903

Other increase/(decrease) to the subsidy allowance (434) (306)

Other changes to the loan modifications 243 1

Allowance for loan and interest loss adjustments 281 100

Other non-cash reconciling items (12) 3

Ending Balance of Loans Receivable, Net $ 125,273 $ 118,254
90 Section II | Financial Information

NOTE 8: Inventory and Related Property, Net

Commodity inventory is restricted for the purpose of alleviating distress caused by natural disasters, providing emergency food assistance in 

developing countries, and providing price support and stabilization.

Commodities: Unit of Measure FY 2023 Beginning Inventory Acquisitions Collateral Acquired Donations Others FY 2023 Ending Inventory

Quantity Value Quantity Value Quantity Value Quantity Value Quantity Value Quantity Value

Corn Meal Pounds — $ — 19 $ 8 — $ — (19) $ (8) — $ — — $ —

Blended Foods Pounds 1 1 78 76 — — (75) (72) — — 4 5

Dry Whole Peas Cwt. — 5 2 75 — — (2) (77) — — — 3

Grain Sorghum Bushels 1 10 9 79 — — (9) (83) — 1 1 7

Lentils Dry Cwt. — 1 — 9 — — — (10) — — — —

Rice Products Cwt., Pounds — — — 15 — — — (15) — — — —

Vegetable Oil Pounds 7 7 104 113 — — (111) (115) — 1 — 6

Wheat Products Bushels, Pounds — — 18 292 — — (18) (292) — — — —

Soybeans Bushels, Pounds — — 263 63 — — (263) (63) — — — —

Other Various — 4 — 12 — — — (10) — — — 6

Total $ 28 $ 742 $ — $ (745) $ 2 $ 27

Commodities: Unit of Measure FY 2022 Beginning Inventory Acquisitions Collateral Acquired Donations Others FY 2022 Ending Inventory

Quantity Value Quantity Value Quantity Value Quantity Value Quantity Value Quantity Value

Corn Meal Pounds — $ — 108 $ 32 — $ — (108) $ (32) — $ — — $ —

Blended Foods Pounds 4 4 83 55 — — (86) (58) — — 1 1

Dry Whole Peas Cwt. — 5 2 91 — — (2) (91) — — — 5

Grain Sorghum Bushels — — 12 102 — — (11) (94) — 2 1 10

Lentils Dry Cwt. — 3 — 17 — — — (19) — — — 1

Rice Products Cwt., Pounds — 2 1 31 — — (1) (33) — — — —

Vegetable Oil Pounds 8 8 141 141 — — (142) (141) — (1) 7 7

Wheat Products Bushels, Pounds — — 20 338 — — (20) (338) — — — —

Peanuts Pounds — — — — 10 2 (4) (1) (6) (1) — —

Soybeans Bushels, Pounds — — 123 43 — — (123) (43) — — — —

Other Various — 1 — 14 — — — (11) — — — 4

Total $ 23 $ 864 $ 2 $ (861) $ — $ 28
USDA | 2023 Agency Financial Report 91

NOTE 9: Property, Plant & Equipment (PP&E), Net

Information concerning deferred maintenance and repairs and estimated land acreage is discussed in 

unaudited required supplementary information.

FY 2023

Category Useful Life (Years) Cost

Accumulated 

Depreciation Net Book Value

Land and Land Rights $ 73 $ — $ 73

Improvements to Land 10 759 (757) 2

Construction-in-Progress 506 — 506

Buildings, Improvements and Renovations 15 – 30 3,276 (2,353) 923

Other Structures and Facilities 8 – 50 1,903 (1,708) 195

Equipment 5 – 25 2,338 (1,490) 848

Assets Under Capital Lease 10 – 25 16 (15) 1

Leasehold Improvements 3 – 15 105 (78) 27

Internal-Use Software 5 1,830 (1,361) 469

Internal-Use Software in Development 71 — 71

Total $ 10,877 $ (7,762) $ 3,115

Total PP&E and Accumulated Depreciation Net PP&E

Balance Beginning of Year $ 2,835

Capitalized Acquisitions 678

Revaluations (2)

Depreciation Expense (396)

Balance at End of Year $ 3,115

FY 2022

Category Useful Life (Years) Cost

Accumulated 

Depreciation Net Book Value

Land and Land Rights $ 73 $ — $ 73

Improvements to Land 10 759 (756) 3

Construction-in-Progress 438 — 438

Buildings, Improvements and Renovations 15 – 30 3,199 (2,282) 917

Other Structures and Facilities 8 – 50 1,879 (1,692) 187

Equipment 5 – 25 2,170 (1,428) 742

Assets Under Capital Lease 10 – 25 18 (16) 2

Leasehold Improvements 4 – 15 104 (74) 30

Internal-Use Software 5 1,595 (1,232) 363

Internal-Use Software in Development 80 — 80

Total $ 10,315 $ (7,480) $ 2,835

Total PP&E and Accumulated Depreciation Net PP&E

Balance Beginning of Year $ 2,588

Capitalized Acquisitions 596

Dispositions (1)

Revaluations (7)

Depreciation Expense (341)

Balance at End of Year $ 2,835
92 Section II | Financial Information

NOTE 10: Stewardship Property, Plant & Equipment

Stewardship PP&E consist of assets whose physical properties resemble those of general PP&E that 

are traditionally capitalized in the financial statements. Due to the nature of these assets, valuation 

would be difficult and matching costs with specific periods would not be meaningful. Stewardship 

PP&E include heritage assets and stewardship land. Information concerning deferred maintenance and 

repairs and estimated land acreage is discussed in unaudited required supplementary information.

Heritage Assets

Heritage assets are unique and are generally expected to be preserved indefinitely. Heritage assets may 

be unique because they have historical or natural significance, are of cultural, educational, or artistic 

importance, or have significant architectural characteristics. The assets are reported in terms of 

physical units rather than cost, fair value, or other monetary values. No amounts are shown on the 

Balance Sheet for heritage assets, except for multi-use heritage assets in which the predominant use of 

the asset is in general government operations. The costs of acquisition, betterment, or reconstruction of 

multi-use heritage assets is capitalized as general PP&E and depreciated. The costs of acquiring, 

constructing, improving, reconstructing, or renovating heritage assets, other than multi-use, is 

considered an expense in the period incurred when determining the net cost of operations. Heritage 

assets consist of collection type, such as objects gathered and maintained for exhibition, such as library 

collections, and non-collection type, such as memorials, monuments, and buildings.

National Forests, National Grasslands and Other Sites

FS manages its heritage assets by site. Sites include national forests, national grasslands, other FSmanaged sites, and non-FS-managed sites such as museums and university laboratories. The mission of 

the FS is to sustain the health, diversity, and productivity of the Nation’s forests and grasslands to meet 

the needs of present and future generations. The FS strives to achieve quality land management under 

the sustainable multiple-use management concept, to deliver the necessary products and services that 

are essential for enhancing natural resource stewardship, and to meet the diverse needs of people. 

Heritage Asset categories can include the following:

Priority Heritage Assets (PHA): Heritage assets of distinct public value that are, or should be, actively 

maintained, and meet one or more of the following criteria:

• The property is recognized through an official designation, such as a listing on the National 

Register of Historic Places, State register, etc.

• The property is recognized through prior investment in preservation, interpretation, and use. Any 

improvement to a PHA that meets real property designation criteria is considered real property.

• The property is recognized in an Agency-approved management plan.

• The property exhibits critical deferred maintenance needs, and those needs have been documented. 
USDA | 2023 Agency Financial Report 93

Other Heritage Assets: Assets that may have potential important historical or cultural significance but 

lack formal listing and the demonstrated need for active maintenance.

Assemblage Assets: Any grouping of artifacts or archival materials aggregated through donation, 

agency events, site-specific or other field collection, other acquisition method, or combination therein. 

Research Centers

ARS was established on November 2, 1953. Congress first authorized federally supported agricultural 

research in the Organic Act of 1862. The statute directed the Commissioner of Agriculture “to acquire 

and preserve in his department all information he can obtain by means of books and correspondence, 

and by practical and scientific experiments.” The scope of USDA’s agricultural research has been 

expanded and extended more than 60 times since the Department was created.

NRCS owns one heritage asset, the Tucson Plant Materials Center (TPMC), which is included in general 

PP&E as a multi-use asset. It was listed in the National Register of Historic Places on July 2, 1997. 

The TPMC develops and evaluates native plants and addresses an array of resource issues relating to 

rangeland, mines, urban land, cropland riparian areas, and desert land. The TPMC provides technical 

assistance to NRCS field offices; Resource Conservation and Development groups; conservation 

districts; Federal, State, or Tribal agencies; and private landowners through the Southwest. 

Library Collections

NAL supports agricultural research through the acquisition, curation, and dissemination of information 

needed to solve today’s agricultural challenges. NAL’s content ranges from special collections 

materials dating from the early 16th century to near-real time observational research data. The Library 

holds more than 3.5 million items. NAL was created as the departmental library for USDA in 1862 and 

became a national library in 1990. One of five national libraries of the U.S., it is also a key member of 

the Agriculture Network Information Collaborative partnership. In its international role, NAL 

participates, as appropriate, in international agricultural information initiatives. 

Acquisition and Withdrawal of Heritage Assets

The FS generally does not construct heritage assets, although in some circumstances important sitestructural components may be rehabilitated or reconstructed into viable historic properties to provide 

forest visitors with use and interpretation. Heritage assets may be acquired through the procurement 

process, but this rarely occurs. Normally, heritage assets are part of the land acquisition and inventory 

process. Withdrawal occurs through land exchange or natural disasters. Most additions occur through 

inventory activities where previously undocumented sites are discovered and added to the total.
94 Section II | Financial Information

Stewardship Land

Stewardship land is land and land rights not acquired for or in connection with items of general PP&E. 

Land is defined as the solid surface of the earth, excluding natural resources. Stewardship land is 

valued for its environmental resources, recreational and scenic value, cultural and paleontological 

resources, vast open spaces, and resource commodities and revenue provided to the Federal 

Government, States, and counties. These assets are reported in terms of physical units rather than cost, 

fair value, or other monetary values. No asset amount is shown on the balance sheet for stewardship 

land. The acquisition cost of stewardship land is considered an expense in the period acquired when 

determining the net cost of operations. Stewardship land consists primarily of the national forests and 

grasslands owned by the FS and conservation easements purchased by NRCS.

National Forests

National forests are formally established and permanently set aside and reserved for national forest 

purposes, including National Wilderness, National Primitive, National Wild and Scenic River, National 

Recreation, National Scenic Research, National Game Refuges and Wildlife Preserve, and National 

Monument areas.

National Grasslands

National grasslands are designated by the Secretary of Agriculture and permanently held by the USDA 

under Title III of the Bankhead-Jones Farm Tenant Act.

Research and Experimental Areas

Research and experimental areas are reserved and dedicated by the Secretary of Agriculture for forest 

and range research experimentation. Areas reported are located outside the exterior boundaries of a 

national forest or national grassland.

National Preserves and Other Areas

National preserves are established to protect and preserve scientific, scenic, geologic, watershed, fish, 

wildlife, historic, cultural, and recreational values; and provide for multiple use and sustained yield of 

renewable resources. Other areas include areas administered by the FS that are not included in one of 

the above groups.

Research Centers

ARS has public domain land used to support scientific solutions to national and global agricultural 

challenges. ARS invests in stewardship land supporting research, development, and outreach of new 

varieties and technologies to mitigate animal/plant diseases and increase productivity, sustainability, 

and product quality. USDA research supports America’s farmers and ranchers in their work to produce 

a safe and abundant food supply, with an additional focus to establish more sustainable systems to 

enhance crop and animal health.
USDA | 2023 Agency Financial Report 95

Conservation Easements

NRCS’ mission objectives in administering the conservation easement programs are to provide 

landowners with financial and technical assistance in return for maintaining and improving high 

quality productive soils, clean and abundant water, healthy plant and animal communities, clean air, an 

adequate energy supply, and working farm and ranch land.

NRCS’ objectives in managing, monitoring, and enforcing the terms and conditions of easement deeds 

are to ensure that: 1) taxpayer investments are properly used in accordance with the intent of the 

program; 2) the agency is a good steward of the land; and 3) the land is properly maintained and 

managed compliant with agreed upon terms and conditions of the easement deed. 

Stewardship resources involve substantial investment in order to gain long-term benefits for the 

American public and help the agency satisfy its mission. The purpose of purchasing easements is to 

restore or enhance wetlands, farmland, grasslands, forest ecosystems, and restore, protect, maintain, 

and enhance the functions of floodplains.

NRCS, on behalf of USDA, administers and owns conservation easements on private lands through a 

variety of programs. The specific uses for the land are identified under each program. Landowners are 

not allowed to withdraw from the program. However, termination or expiration may occur.

For the purpose of reporting, all easements where NRCS (or a variant of the United States 

administered through NRCS authorities) is listed as a grantee of the easement are included in the 

agency’s stewardship land count. The NRCS stewardship land easements include conservation 

easements enrolled through program authorities and other easements administered by NRCS. As not all 

stewardship land conservation easements are permanent in duration, adjustments to end of year count 

and acreage balances may be made to account for expired or extinguished easements. 

Acquisition and Withdrawal of Stewardship Lands

The Land and Water Conservation Fund (L&WCF) Land Acquisition Program acquires land for the FS 

National Forest System (NFS). The program coordinates with a variety of partners, including State, 

local, and Tribal Governments, and private landowners through statewide planning for development of 

a land-adjustment strategy.

The Land Acquisition Program preserves, develops, and maintains access to NFS lands and waters for 

the public and provides permanent access to public lands for recreation, commodity production, 

resource management, public safety, and community economic viability. 

The L&WCF statutory authority specifically defines the purpose to also include protecting the quality 

of scientific, scenic, historical, ecological, environmental, air and atmospheric, water resource, 

archeological values, as well as food and habitat for fish and wildlife, and managing the public lands 

for minerals, food, timber, and fiber. 
96 Section II | Financial Information

From these several allowable uses of program funding, the program concentrates on protecting habitat 

for priority species identified in the national forest and grassland’s Land Management Plans and 

enhancing recreational opportunities for areas with high demand for recreation. The program focuses 

acquisitions on inholdings and areas adjacent to existing NFS lands.

FY 2023 (In Units) Beginning Balance Additions Withdrawals Ending Balance

Heritage Assets

National Forests 154 — — 154

National Grasslands 20 — — 20

Other Sites 171 — — 171

Research Centers 34 — — 34

Library Collections 1 — — 1

Total 380 — — 380

Stewardship Land

National Forests 154 — — 154

National Grasslands 20 — — 20

Research and Experimental Areas 3 — — 3

National Preserves and Other Areas 2 — — 2

Research Centers 33 — — 33

Conservation Easements 19,421 203 (1) 19,623

Total 19,633 203 (1) 19,835

FY 2022 (In Units) Beginning Balance Additions Withdrawals Ending Balance

Heritage Assets

National Forests 154 — — 154

National Grasslands 20 — — 20

Other Sites 171 1 (1) 171

Research Centers 34 — — 34

Library Collections 1 — — 1

Total 380 1 (1) 380

Stewardship Land

National Forests 154 — — 154

National Grasslands 20 — — 20

Research and Experimental Areas 3 — — 3

National Preserves and Other Areas 2 — — 2

Research Centers 33 — — 33

Conservation Easements 19,207 214 — 19,421

Total 19,419 214 — 19,633
USDA | 2023 Agency Financial Report 97

NOTE 11: Other Assets

Item FY 2023 FY 2022

Intragovernmental Assets

Reimbursement Work Asset $ 9 $ —

Total Intragovernmental Assets $ 9 $ —

Total Other Assets $ 9 $ —

NOTE 12: Liabilities Not Covered by Budgetary 

Resources

In FY 2023 and FY 2022, other intragovernmental liabilities not covered by budgetary resources 

included accruals for FECA of $119 million and $120 million, contract disputes claims payable to 

Treasury’s Judgment Fund of $27 million and $27 million, unemployment compensation of $11 million 

and $10 million, and Technology Modernization Fund of $47 million and $9 million, respectively.

In FY 2023 and FY 2022, other liabilities with the public not covered by budgetary resources included 

contingent liabilities of $75 million and $79 million, Payments to States of $316 million and 

$329 million, single-family housing escrow of $78 million and $55 million, loans paid in advance for 

multi-family housing of $26 million and $25 million, and stewardship contracting product sales of 

$5 million and $4 million, respectively.

Item FY 2023 FY 2022

Intragovernmental

Other $ 204 $ 166

Subtotal Intragovernmental 204 166

Other than Intragovernmental

Federal Employee Benefits Payable 1,364 1,332

Environmental and Disposal Liabilities 240 236

Insurance and Guarantee Program Liabilities 13,823 12,611

Other 500 492

Subtotal Other than Intragovernmental 15,927 14,671

Total Liabilities Not Covered by Budgetary Resources 16,131 14,837

Total Liabilities Covered by Budgetary Resources 185,079 172,090

Total Liabilities Not Requiring Budgetary Resources 3,077 5,963

Total Liabilities $ 204,287 $ 192,890
98 Section II | Financial Information

NOTE 13: Debt

FY 2023 Beginning Balance Net Borrowing Ending Balance

Source of Debt

Debt Owed to the Federal Financing Bank $ 51,845 $ 3,076 $ 54,921

Debt Owed to Treasury other than FFB 87,342 9,571 96,913

Total Debt $ 139,187 $ 12,647 $ 151,834

FY 2022 Beginning Balance Net Borrowing Ending Balance

Source of Debt

Debt Owed to the Federal Financing Bank $ 48,772 $ 3,073 $ 51,845

Debt Owed to Treasury other than FFB 84,049 3,293 87,342

Total Debt $ 132,821 $ 6,366 $ 139,187

NOTE 14: Federal Employee Benefits Payable

Other than Intragovernmental: FY 2023 FY 2022

Employer Contributions and Payroll Taxes Payable $ — $ 2

Unfunded Leave 756 707

Actuarial FECA Liability 608 625

Total Federal Employee Benefits Payable $ 1,364 $ 1,334

NOTE 15: Environmental and Disposal Liabilities

USDA is subject to the Comprehensive Environmental Response, Compensation, and Liability Act, the 

Clean Water Act, and the Resource Conservation and Recovery Act for cleanup of hazardous waste. 

In FY 2023 and FY 2022, FS estimates the liability for total cleanup costs for sites known to contain 

hazardous waste to be $1 million and $2 million, respectively, based on actual cleanup costs at similar 

sites. In FY 2023 and FY 2022, CCC estimates the liability for total cleanup costs for sites known to 

contain hazardous waste to be $47 million and $45 million, respectively, based on actual cleanup costs 

at similar sites. CCC estimates the range of potential future losses due to remedial actions to be 

between $47 million and $665 million. These estimates will change as new sites are discovered, 

remedy standards change, and new technology is introduced. 

In FY 2023 and FY 2022, ARS estimated the liability for cleanup of the Beltsville Agricultural 

Research Center (BARC) to be $50 million and $46 million, respectively. Remediation costs are 

calculated for each site utilizing costs presented in a feasibility study, engineering estimate, actual 

costs, etc. Ground water monitoring and/or reporting costs are calculated for each site, assuming 

annual monitoring, where the annual monitoring costs are projected over a 30-year period (assuming 
USDA | 2023 Agency Financial Report 99

indefinite long-term monitoring or remedial action operation period/phase). Where monitoring costs 

have already been paid for (contract executed) and/or where modeling or testing has deemed a period 

shorter than 30-years, those long-term management costs were not included in the 30-year period. 

Adjustments for inflation are also included in the estimates. ARS is evaluating and remediating areas 

of concern on BARC that are contaminated or threaten to contaminate ground and surface water with 

pesticides, solvents, metals, and other hazardous substances.

USDA is also subject to Asbestos National Emissions Standards for Hazardous Air Pollutants. 

In FY 2023 and FY 2022, the Department estimated its liability for asbestos-related cleanup of real 

property to be $150 million and $148 million, respectively. The liability is calculated using total square 

footage of real property expected to contain asbestos times a cost factor based on historical actual 

cleanup costs, adjusted for inflation, including any other identifiable costs, e.g., survey cost. 

As additional information becomes available, key assumptions will be reevaluated, cost estimates will 

be revised, and necessary adjustments will be made to the liability recognition.

NOTE 16: Insurance Programs

In crop year 2023, there were approximately 1.2 million standard reinsurance and livestock policies 

totaling approximately $206.06 billion insurance in-force, however, there is a remote likelihood that 

claims equal to the entire insurance in-force will be filed at the same time.

The AIPs for FY 2023 are as follows:

• Ace American Insurance Company

• American Agri-Business Insurance Company

• American Agricultural Insurance Company

• CGB Insurance Company

• Church Mutual Insurance Company

• Country Mutual Insurance Company

• Farmers Mutual Hail Insurance Company of Iowa

• Great American Insurance Company

• Hudson Insurance Company

• NAU Country Insurance Company

• Palomar Specialty Insurance Company

• Producers Agriculture Insurance Company

• Rural Community Insurance Company

• Stratford Insurance Company

• XL Reinsurance America Inc.
100 Section II | Financial Information

The funds within the Federal Crop Insurance Program can be used to pay any authorized expense of 

the program. The following table lists the type of funds received and the resources used by the program 

for 2023 and 2022. 

Federal Crop Insurance Program Resource and Resources Used

Resource Fiscal Year 2023 Uses Fiscal Year 2023

Producer Premiums Collected $ 7,029 Obligations for Delivery Costs $ 2,431

Producer Fees Collected 47 Obligations for Indemnities 18,722

Underwriting Loss Collected from AIPs 136 Obligations for Underwriting Gain 1,354

Appropriations 15,378 Obligations for Initiatives & Other Costs 70

Appropriations Transfers (13)

Unobligated Balance Beginning of Year 594 Unobligated Balance End of Year 594

Total $ 23,171 Total $ 23,171

Resource Fiscal Year 2022 Uses Fiscal Year 2022

Producer Premiums Collected $ 6,252 Obligations for Delivery Costs $ 2,206

Producer Fees Collected 49 Obligations for Indemnities 13,637

Underwriting Loss Collected from AIPs 4 Obligations for Underwriting Gain 2,731

Appropriations 12,353 Obligations for Initiatives & Other Costs 73

Appropriations Transfers (13)

Unobligated Balance Beginning of Year 594 Unobligated Balance End of Year 592

Total $ 19,239 Total $ 19,239

In addition to the mandatory FCIC fund, RMA obligated $73.5 million in Salaries and Expenses funds 

to administer the Federal Crop Insurance Program in 2023. The Federal Crop Insurance Act requires 

the total premium, including producer paid premium and premium subsidy, to be established to achieve 

an overall projected loss ratio of not greater than 1.0 over an extended period of time. The FCIC Act 

dictates the percentage of subsidized premium. The estimation of expected indemnities is generally 

based on the observed historical rate of loss often referred to as the ‘loss cost’ method.

In fiscal year 2023 there was widespread drought and excessive heat in many parts of the nation, 

causing catastrophic damage to crops. To provide relief, RMA deferred collection of any unpaid 

producer premium without interest by two months. The total amount of deferred collections was 

approximately $4.7 billion. 

FCIC collects administrative fees from producers in return for catastrophic risk protection coverage 

and additional levels coverage. The rates are set by statute. For reinsurance year 2023, the catastrophic 

risk protection fees were $655 per crop per county and $30 for additional levels coverage per crop 

per county.

FCIC may request the Secretary of Agriculture to provide borrowing authority funds of the CCC if at 

any time the amounts in the insurance fund are insufficient to allow FCIC to carry out its duties. Even 

though the authority exists, FCIC did not request CCC funds in the reporting period. Instead, FCIC 

uses such sums as are necessary from the U.S. Treasury to cover program costs that exceed collections.
USDA | 2023 Agency Financial Report 101

Loss Recognition

The end of the government’s fiscal year, on September 30, occurs while many crops are still in the field 

and subject to ongoing natural risks causing significant uncertainty for the end-of-fiscal-year estimates 

of claims. Estimates can often vary by 20 percent or more from results.

Estimates of claims are based on current crop conditions and historical trends for a given crop 

condition. Therefore, it is assumed the expected claims will be like levels observed historically.

Estimates assume there is a relationship between crop yields, harvest prices, and the resulting loss 

ratios. The indemnity for an individual producer is based on the difference between the producer’s 

actual yield and his/her average yield. Similarly, for revenue plans, the indemnity is based on the 

difference between the actual harvest price and the “base” price which is the estimated harvest price at 

the time the crop is planted. 

Regression analyses are calculated based on the historic relationships between the crop yields and 

harvest prices (when necessary) for each crop in each State and the resulting loss ratios in each of those 

years. The resulting regression coefficients are used in conjunction with the most recent NASS forecasts 

and commodity futures prices to calculate a projected loss ratio for each crop/State combination.

There are uncertainties associated with these assumptions including:

• Actual yields, which may be different than those provided by the NASS estimates; 

• Changes in weather patterns close to harvesting dates, which could affect yields but not be 

reflected in the NASS estimates; 

• Commodity prices, which may change from those in the market because of many factors (such as 

weather, yields, and economic conditions); and 

• Significant catastrophic weather events (i.e. hurricanes and freezes) occurring near the balance 

sheet date, which could affect estimated crop yields and crop prices. 

There are uncertainties associated with assumptions used to estimate losses on insurance claims. As a 

result, the ultimate liability may differ significantly from the recorded estimate. Indemnity costs are 

paid from premium proceeds, including producer paid premium and premium subsidies. If indemnity 

costs exceed funds available, additional funds will be requested and apportioned to FCIC. 
102 Section II | Financial Information

Insurance Liabilities

The following table shows the insurance liabilities as of September 30, 2023 and September 30, 2022.

Item 2023 2022

Estimated Losses on Insurance Claims

Liability for Unpaid Insurance Claims $ 3,053 $ 3,007

Liability for Losses on Remaining Coverage 8,904 8,574

Total Estimated Losses on Insurance Claims $ 11,957 $ 11,581

Unearned Revenue 1,843 1,694

Underwriting Gain 3,517 4,030

Other Insurance Liabilities 20 20

Total Insurance Liabilities $ 17,337 $ 17,325

Reported insurance liabilities increased from fiscal year 2022 to fiscal year 2023. This increase is 

attributed to: 

• Higher coverage amounts resulting from higher crop prices

• Higher level of losses caused by widespread drought and excessive heat

• Increased participation in certain insurance products

Estimated Losses on Insurance Claims

The following tables show information for changes in the estimated losses on insurance claims for 

fiscal year 2023 and fiscal year 2022. 

Changes in Estimated Losses on Insurance Claims 2023 2022

Beginning Balance $ 11,581 $ 9,985

Claims Expenses 18,647 13,638

Payments to Settle Claims (18,823) (13,403)

Adjustment of Accruals for Estimated Losses 552 1,361

Ending Balance $ 11,957 $ 11,581

In fiscal year 2023, the actual claims reported were $5.0 billion more than fiscal year 2022. This was a 

result of higher losses related to higher commodity prices and widespread drought and excessive heat. 

Payments to Settle Claims are the actual payments to producers. 

The Adjustment of Accrual for Estimated Losses is the reversal of the prior year accrual combined with 

the current year accrual for estimated losses. The indemnity projection is based on two major factors: 

losses due to a shortfall in yield and changes in commodity prices impacting revenue plans. The 

principal data source for yield projections is the NASS Crop Production report. The NASS Crop 

Production report is considered to represent USDA’s official perspective on the current state of 

agricultural production. It is based on a survey of growers along with inspections of randomly selected 

sections of farms. Although the NASS Crop Production report is scrutinized by multiple sources, it is 

still an estimate and is subject to some uncertainty.
USDA | 2023 Agency Financial Report 103

The revenue plans of insurance base their indemnities on the futures prices for specific contracts and 

exchanges. The best prediction of the final price for the futures contract is the most current price of the 

relevant commodities exchange. At the time the indemnity projection is made, up-to-date futures prices 

are taken from multiple exchanges. Again, this is subject to uncertainty due to fluctuations in markets. 

Liability for Unpaid Insurance Claims 

Liability for unpaid insurance claims are claims for adverse events that occurred before the end of the 

reporting period. Under SFFAS 51, for the claim to be considered incurred, a single event or a series of 

events must be completed by the end of the reporting period to be considered an adverse event of the period. 

The liability for unpaid insurance claims is comprised of the following:

• Funds in the Escrow accounts to cover payments to producers who have not cashed their 

indemnity payments 

• Claims reported but not paid as of the end of the reporting period

• Incurred but Not Reported (IBNR) is estimated claims from events that have occurred as of the 

end of the reporting period but have not yet been reported for settlement. 

FCIC uses a historical trend analysis based upon the data from the prior years to determine the value of 

claims incurred for the current reinsurance year as of the financial statement reporting date. When the 

Summary of Business (SOB) is higher than the estimate at year end, the SOB amount is used. 

Liability for Losses on Remaining Coverage

The liability for losses on remaining coverage as of the end of the reporting period represents the 

estimated amounts to be paid to settle claims for the remaining open arrangement period exceeding 

losses associated with the related unearned premiums as of the end of the reporting period. 

The liability for losses on remaining coverage is the total projected losses minus actual losses reported, 

IBNR, and losses associated with unearned premium. 

Liability for Unearned Insurance Premiums 

Premium revenue is comprised of producer paid premium. Producer paid premium is recognized as 

earned proportionately over each crop’s growing season. The portion of producer paid premium not 

recognized at the conclusion of the fiscal year is classified as insurance and guarantee program 

liabilities in the balance sheet. Most of the increase in fiscal year 2023 was due to higher premiums 

caused by higher crop prices.

Item 2023 2022

Liability for Unearned Insurance Premiums $ 1,843 $ 1,694
104 Section II | Financial Information

Underwriting Gain/Loss

Underwriting gain/loss is the AIPs portion of earnings or losses on the insurance book of business due 

from or to FCIC. A periodic settlement, as stipulated in the Standard Reinsurance Agreement, is 

calculated where results of business written by AIPs are determined and an experience-rated gain or 

loss on business ceded from AIPs is computed. Payments due to AIPs for a net gain are paid in the 

second fiscal year following the reinsurance year. Underwriting losses are paid to FCIC periodically.

Underwriting Gain 2023 2022

Current Year Estimated Gains $ 2,175 $ 1,517

Actual Underwriting Gains 1,342 2,513

Total Underwriting Gain Liability $ 3,517 $ 4,030

At the end of fiscal year 2023, the underwriting gain liability includes amounts for reinsurance years 

2022 and 2023. The reinsurance year 2023 estimated underwriting gain was $2,175 million based on a 

loss ratio of .92. The actual reinsurance year 2022 Underwriting Gain of $1,342 million was based on 

an actual loss ratio of 1.05 and will be paid in fiscal year 2024.

At the end of fiscal year 2022, the underwriting gain liability includes amounts for reinsurance years 

2021 and 2022. The reinsurance year 2022 estimated underwriting gain was $1,517 million based on a 

loss ratio of 1.01 for standard reinsurance agreements. The actual reinsurance year 2021 Underwriting 

Gain of $2,513 million was based on an actual loss ratio of .68 and was paid in fiscal year 2023.

NOTE 17: Other Liabilities

Intragovernmental Liabilities:

Other Debt

In FY 2022, other debt represents a repayable advance to Treasury of $2,595 million for the 

Agricultural Disaster Relief Trust Fund.

Liability for Non-Entity Assets Not Reported as Custodial Activities

In FY 2023 and FY 2022, liability for non-entity assets not reported as Custodial Activities represents 

liquidating fund balances of $8,893 million and $7,800 million, respectively due to the General Fund.

Other Liabilities Without Related Budgetary Obligations

In FY 2022, other liabilities without related budgetary obligations includes amount due to the General 

Fund of $3,197 million for a financing event that did not occur until FY 2023.
USDA | 2023 Agency Financial Report 105

Other than Intragovernmental Liabilities:

Other Liabilities With Related Budgetary Obligations

In FY 2023, other liabilities with related budgetary obligations with the public included Agricultural 

Risk Coverage of $272 million; Grants, Subsidies, and Contributions of $5,564 million; Conservation 

Reserve Program of $1,789 million; and other accrued liabilities of $1,070 million.

In FY 2022, other liabilities with related budgetary obligations with the public included Agricultural 

Risk Coverage of $97 million; Price Loss Coverage of $216 million; Grants, Subsidies, and 

Contributions of $4,872 million; Conservation Reserve Program of $1,772 million; and other accrued 

liabilities of $754 million.

Other Liabilities Without Related Budgetary Obligations

In FY 2023, other liabilities without related budgetary obligations with the public included Payments 

to States of $316 million, single-family housing escrow of $78 million, loans paid in advance for 

multi-family housing of $26 million, and other accrued liabilities of $6 million.

In FY 2022, other liabilities without related budgetary obligations with the public included Payments 

to States of $329 million, single-family housing escrow of $55 million, loans paid in advance for 

multi-family housing of $25 million, and other accrued liabilities of $4 million.

FY 2023

Non-Current Current Total

Intragovernmental Liabilities:

Other Liabilities With Related Budgetary Obligations $ — $ 66 $ 66

Employer Contributions and Payroll Taxes — 176 176

Unfunded FECA Liability 67 52 119

Other Unfunded Employment Related Liability — 11 11

Liability for Clearing Accounts — 14 14

Custodial Liability — 414 414

Liability for Non-Entity Assets Not Reported as Custodial Activities — 8,893 8,893

Other Liabilities Without Related Budgetary Obligations — 73 73

Total Intragovernmental Liabilities $ 67 $ 9,699 $ 9,766

Other than Intragovernmental Liabilities:

Other Liabilities With Related Budgetary Obligations — 8,695 8,695

Accrued Funded Payroll and Leave — 655 655

Liability for Nonfiduciary Deposit Funds and Undeposited Collections — 600 600

Liability for Clearing Accounts — (13) (13)

Contingent Liabilities (Note 19) — 75 75

Capital Lease Liability (Note 18) — 1 1

Other Liabilities Without Related Budgetary Obligations 26 400 426

Total Other than Intragovernmental Liabilities $ 26 $ 10,413 $ 10,439

Total Other Liabilities $ 93 $ 20,112 $ 20,205
106 Section II | Financial Information

FY 2022

Non-Current Current Total

Intragovernmental Liabilities:

Other Liabilities With Related Budgetary Obligations $ — $ 41 $ 41

Employer Contributions and Payroll Taxes — 161 161

Unfunded FECA Liability 66 54 120

Other Unfunded Employment Related Liability — 10 10

Liability for Clearing Accounts — 18 18

Other Debt — 2,595 2,595

Custodial Liability — 257 257

Liability for Non-Entity Assets Not Reported as Custodial Activities — 7,800 7,800

Other Liabilities Without Related Budgetary Obligations — 3,234 3,234

Total Intragovernmental Liabilities $ 66 $ 14,170 $ 14,236

Other than Intragovernmental Liabilities:

Other Liabilities With Related Budgetary Obligations — 7,711 7,711

Accrued Funded Payroll and Leave — 611 611

Liability for Nonfiduciary Deposit Funds and Undeposited Collections — 588 588

Liability for Clearing Accounts — (18) (18)

Contingent Liabilities (Note 19) — 79 79

Capital Lease Liability (Note 18) 1 1 2

Custodial Liability — 1 1

Other Liabilities Without Related Budgetary Obligations 25 388 413

Total Other than Intragovernmental Liabilities $ 26 $ 9,361 $ 9,387

Total Other Liabilities $ 92 $ 23,531 $ 23,623

NOTE 18: Leases

Capital Leases

USDA enters into leasing agreements through leasing authority delegated by GSA. USDA acquires use 

of various general facilities (buildings and plant material centers), equipment, and land with renewal 

options that range from 0 to 10 years and which are located mainly in urban areas. The portfolio 

includes leases with escalation clauses based on the Consumer Price Index (CPI), and amortization 

periods with a range of 10 to 25 years.

Operating Leases

USDA enters into leasing agreements through leasing authority delegated by GSA. USDA leases 

various land, buildings, and equipment. 

Major non-cancelable operating leases consists primarily of office space, most with renewal options 

with escalation clauses based on the CPI, and lease periods with a range of 1 to 59 years.

The USDA Headquarters complex (Whitten Building and South Building) is a government owned 

facility, which is part of the GSA Federal Buildings Inventory. As the result of a 1998 agreement 

between GSA and USDA, a moratorium was placed on the rental billings for the Headquarters complex 
USDA | 2023 Agency Financial Report 107

beginning in FY 1999. At current market rate, the estimated yearly rental payment for the above 

mentioned space would be $69 million. This agreement is still in effect and as a result, USDA activities 

located in the Headquarters complex are not billed for rental costs. Imputed costs are not recognized.

FY 2023

Capital Leases

Summary of Assets Under Capital Leases Federal Non-Federal Total

Land and Building $ — $ 16 $ 16

Accumulated Amortization — (15) (15)

Total $ — $ 1 $ 1

Future Payments Due Land & Buildings Machinery & Equipment Totals

Federal Non-Federal Federal Non-Federal Federal Non-Federal

Fiscal Year 2024 $ — $ 1 $ — $ — $ — $ 1

Fiscal Year 2025 — 1 — — — 1

Fiscal Year 2026 — — — — — —

Fiscal Year 2027 — — — — — —

Fiscal Year 2028 — — — — — —

After 5 Years — — — — — —

Total Future Lease Payments — 2 — — — 2

Less: Imputed Interest — 1 — — — 1

Net Capital Lease Liability — 1 — — — 1

Capital Lease Liabilities Covered by Budgetary Resources $ — $ 1 $ — $ — $ — $ 1

Operating Leases

Future Payments Due for Non-Cancellable 

Operating Leases Land & Buildings Machinery & Equipment Totals

Federal Non-Federal Federal Non-Federal Federal Non-Federal

Fiscal Year 2024 $ 13 $ 61 $ — $ 1 $ 13 $ 62

Fiscal Year 2025 2 41 — — 2 41

Fiscal Year 2026 1 34 — — 1 34

Fiscal Year 2027 1 28 — — 1 28

Fiscal Year 2028 1 21 — — 1 21

After 5 Years 2 94 — — 2 94

Total Future Lease Payments $ 20 $ 279 $ — $ 1 $ 20 $ 280
108 Section II | Financial Information

FY 2022

Capital Leases

Summary of Assets Under Capital Leases Federal Non-Federal Total

Land and Building $ — $ 18 $ 18

Accumulated Amortization — (16) (16)

Total $ — $ 2 $ 2

Future Payments Due Land & Buildings Machinery & Equipment Totals

Federal Non-Federal Federal Non-Federal Federal Non-Federal

Fiscal Year 2023 $ — $ 3 $ — $ — $ — $ 3

Fiscal Year 2024 — 1 — — — 1

Fiscal Year 2025 — — — — — —

Fiscal Year 2026 — — — — — —

Fiscal Year 2027 — — — — — —

After 5 Years — — — — — —

Total Future Lease Payments — 4 — — — 4

Less: Imputed Interest — 2 — — — 2

Net Capital Lease Liability — 2 — — — 2

Capital Lease Liabilities Covered by Budgetary Resources $ — $ 2 $ — $ — $ — $ 2

Operating Leases

Future Payments Due for Non-Cancellable 

Operating Leases Land & Buildings Machinery & Equipment Totals

Federal Non-Federal Federal Non-Federal Federal Non-Federal

Fiscal Year 2023 $ 11 $ 56 $ — $ 1 $ 11 $ 57

Fiscal Year 2024 — 36 — 2 — 38

Fiscal Year 2025 — 30 — — — 30

Fiscal Year 2026 — 26 — — — 26

Fiscal Year 2027 — 20 — — — 20

After 5 Years — 102 — — — 102

Total Future Lease Payments $ 11 $ 270 $ — $ 3 $ 11 $ 273
USDA | 2023 Agency Financial Report 109

NOTE 19: Commitments and Contingencies

The Department is subject to various contingencies related to legal claims as well as commitments 

under contractual and other commercial obligations.

No amounts have been accrued in the financial statements for claims where the amount is uncertain or 

where the probability of judgment is remote. 

Item Accrued Liabilities Estimated Range of Loss

Lower End Upper End

FY 2023

Legal Contingencies:

Probable $ 75 $ 75 $ 75

Reasonably Possible 1,087 1,728

Item Accrued Liabilities Estimated Range of Loss

Lower End Upper End

FY 2022

Legal Contingencies:

Probable $ 79 $ 79 $ 548

Reasonably Possible 143 755

Commitments to extend loan guarantees are estimated to be $3,731 million and $4,605 million in 

FY 2023 and FY 2022, respectively.

NOTE 20: Funds from Dedicated Collections

Funds from dedicated collections are financed by specifically identified revenues, often supplemented 

by other financing sources, which remain available over time. These specifically identified revenues 

and other financing sources are required by statute to be used for designated activities or purposes and 

must be accounted for separately from the Government’s general revenues. 

Financial information for all significant funds from dedicated collections follows the descriptions of 

each fund’s purpose shown below.

Agricultural Marketing Service (AMS)

Expenses and Refunds, Inspection and Grading of Farm Products

The commodity grading programs provide grading, examination, and certification services for a wide 

variety of fresh and processed food commodities using federally approved grade standards and purchase 

specifications. This fund is financed by the collection of fees charged to producers of various food 

commodities who request, on a voluntary basis, inspection and grading of agricultural food commodities. 

This program is authorized by the Agricultural Marketing Act of 1946 (7 U.S.C. 1621–1627).
110 Section II | Financial Information

Funds for Strengthening Markets, Income, and Supply 

The funds for strengthening markets, income, and supply are used to purchase commodities for schools 

and elderly feeding programs, to provide goods and other necessities in emergencies and disasters, and to 

purchase agricultural commodities to stabilize markets. The fund is permanently financed by statutory 

transfer of an amount equal to 30 percent of customs receipts collected during each calendar year and is 

automatically appropriated for expanding outlets for perishable, non-price supported commodities. An 

amount equal to 30 percent of receipts collected on fishery products is transferred to the Department of 

Commerce’s National Oceanic and Atmospheric Administration. All remaining funding in excess of the 

amount made available under the 2008 Farm Bill to carry out Section 32 activities is transferred to the 

Food and Nutrition Service and is used to purchase commodities under section 6 of the National School 

Lunch Act and other authorities specified in the child nutrition appropriation. Funds are available under 

section 32 of the Act of August 24, 1935, as amended (7 U.S.C. 612c).

Animal and Plant Health Inspection Service (APHIS)

Agricultural Quarantine Inspection User Fee Account 

This fund is used to record and report expenditures and revenue associated with operating Agricultural 

Quarantine Inspection (AQI) activities at ports of entry. The Farm Bill of 1990, as amended by the 

Federal Agriculture Improvement and Reform Act of 1996, gave APHIS the authority to charge user 

fees for AQI services and to use the revenue to fund AQI activities. In March of 2003, a portion of the 

AQI program was transferred to the Department of Homeland Security (DHS); however, APHIS 

retained the authority to collect AQI revenue. APHIS transfers a portion of the revenue to DHS 

periodically throughout the year to fund its expenditures. The revenue in the fund is collected from 

airlines, air passengers, vessels, trucks, and railroad cars that are subject to AQI inspection at ports of 

entry. These user fees are an inflow of revenue from the public that is used to fund AQI inspections 

that are required by APHIS and DHS. The authority is codified in 21 U.S.C. 136(a). 

Forest Service (FS)

Acquisition of Lands to Complete Land Exchanges

Land Exchange Acquisitions is authorized by the Act of December 4, 1967, as amended (16 U.S.C. 

484a), commonly known as The Sisk Act. All deposits received during the previous fiscal year are 

made available by the annual appropriation act. The authorizing legislation provides for cash deposits 

of a portion or all of the value of the selected lands in exchange cases with States, local governments, 

and public school districts or other public school authority, to be used to purchase similar lands, or in 

cases of special legislation, for authorized expenditures from funds deposited by non-Federal parties.

Cooperative Work

Cooperative contributions are deposited for disbursement in compliance with the terms and provisions 

of the agreement between the cooperator and the FS. Cooperators include timber purchasers, not-forprofit organizations, and local hunting and fishing clubs. The governing authorities are the Cooperative 

Funds Act of July 31, 1914 (16 U.S.C. 498) and the Knutson Vandenberg Act.
USDA | 2023 Agency Financial Report 111

Land Acquisition

Funds are appropriated annually from Interior’s Land and Water Conservation Fund, but are no-year 

appropriations to the Forest Service for acquisition of land pursuant to the Land and Water Conservation 

Act, as amended and other land acquisition authorities of the Forest Service (section 40.12).

National Grasslands Receipts

Title III, Bankhead-Jones Farm Tenant Act (Act) of July 22, 1937, as amended (7 U.S.C. 1012) 

authorizes annual payments on a calendar year basis to counties, equal to 25 percent of revenues 

received during the year from sales activities and fees on lands designated as national grasslands or 

land utilization projects. Counties use these payments for public schools and roads.

The administrative process of aggregating the receipts on a calendar year basis (involving two fiscal years) 

and disbursing the payments requires an unavailable receipt account (National Grasslands Receipts, Forest 

Service) and an available receipt account (Payments to Counties, National Grasslands, Forest Service).

National Forest Fund Receipts

The Act of May 23, 1908, as amended (16 U.S.C. 500), requires (with a few exceptions) that all receipts 

from national forest activities be aggregated each fiscal year in order to calculate the portion which is 

paid to the States in which the national forests are located. The payments must be used for public schools 

and roads in the county or counties in which the national forests are situated. Originally, the States’ 

portion of receipts was 25 percent, but past statutory amendments have changed the calculation factors 

from time to time. Receipts include revenues from the sale of timber and other forest products; fees for 

grazing, special-use permits, power and mineral leases; and recreation user fees. 

National Parks and Public Land Legacy Restoration Fund 

The Great American Outdoors Act (GAOA) (P.L. 116-152) provides authority to establish the National 

Parks and Public Land Legacy Restoration Fund to address the maintenance backlog on public lands. 

The funds are allocated across GAOA-specified bureaus/agencies including the USDA Forest Service 

for fiscal years 2021 through 2025.

Payments to States, National Forest Fund 

The Act of May 23, 1908, as amended (16 U.S.C. 500), commonly known as Payments to States, requires 

with a few exceptions, that 25 percent of all monies received from the national forests and deposited into 

the National Forest Fund during a fiscal year from timber, grazing, special-use permits, power and mineral 

leases, and admission and user fees be paid to the States in which the national forests are located, for 

public schools and public roads in the county or counties in which the national forests are situated. 

Recreation Fee Demonstration Program 

The Recreation Fee Demonstration Program fund receives deposits of recreation fees collected from 

projects that are part of the Recreation Fee Demonstration Program. These monies are retained and 

used for backlog repair and maintenance of recreation areas, sites, or projects. These funds are also 

used for interpretation, signage, habitat or facility enhancement, resource preservation, annual 
112 Section II | Financial Information

operation, maintenance, and law enforcement related to public use of recreation areas and sites. 

The Recreation Fee Demonstration Program is authorized by 16 U.S.C. 4601-6(a).

Reforestation Trust Fund

The Reforestation Trust Fund, 16 U.S.C. 1606a, receives its budgetary resources from periodic 

transfers by the U.S. Treasury of tariffs from exported timber. Amounts may be invested and reinvested 

by the FS in U.S. Treasury interest bearing Government securities. The funds are available for use by 

the Secretary of Agriculture to obligate for reforestation and timber-stand improvement activities.

Restoration of Forest Lands and Improvements

The Restoration of Forest Lands and Improvements Acts (16 U.S.C. 579(c)) states any monies received by 

the United States with respect to lands under the administration of the Forest Service (a) as a result of the 

forfeiture of a bond or deposit by a permittee or timber purchaser for failure to complete performance of 

improvement, protection, or rehabilitation work required under the permit or timber sale contract or (b) as 

a result of a judgment, compromise, or settlement of any claim, involving present or potential damage to 

lands or improvements, shall be deposited into the Restoration of Forest Lands and Improvements 

Account. The monies are then made available until expended to cover the cost to the United States of any 

improvement, protection, or rehabilitation work on lands under the administration of the Forest Service 

rendered necessary by the action which led to the forfeiture, judgment, compromise, or settlement, 

provided that any portion of the monies received in excess of the amount expended in performing the 

work necessitated by the action which led to their receipt shall be transferred to miscellaneous receipts.

State and Private Forestry 

The FY 2004 Department of the Interior and Related Agencies Appropriation Act (P.L. 108-108) 

authorizes the Forest Service to receive a transfer of receipts from the Department of the Interior’s 

Land and Water Conservation Fund to finance the existing Forest Legacy Program. Treasury 

established a new special fund, “State and Private Forestry” to accommodate for this program, and the 

funding is available until expended. The program expenditures include grants and an occasional land 

purchase, but no real property will be procured or constructed.

Stewardship Contracting Product Sales

Stewardship End Result Contracting Projects (16 U.S.C. 6591c), amends the Healthy Forests 

Restoration Act of 2003, and states the Forest Service, via agreement or contract as appropriate, may 

enter into stewardship contracting projects with private persons or other public or private entities to 

perform services to achieve land management goals for the national forests and the public lands that 

meet local and rural community needs. The value of timber or other forest products removed may be 

applied as an offset against the cost of services received under the agreements or contracts. Monies 

earned from such agreements or contracts may be retained by the Forest Service and shall be available 

for expenditure without further appropriation at the project site from which the monies are collected or 

at another project site. In addition, if the offset value of the forest products exceeds the value of the 

resource improvement treatments, the Forest Service may collect any residual receipts under the Act of 

June 9, 1930 (commonly known as the Knutson-Vandenberg Act, 16 U.S.C. 576); and apply the excess 
USDA | 2023 Agency Financial Report 113

to other authorized stewardship projects. Finally, the Forest Service is required to annually report to the 

Committee of Agriculture, Nutrition, and Forestry of the Senate and the Committee on Agriculture of 

the House of Representatives on the status and accomplishments of these agreements and contracts.

Timber Salvage Sales

The Salvage Sale Fund was established to facilitate the timely removal of timber damaged by fire, 

wind, insects, diseases, or other events. Amounts collected from the sale of salvaged timber are used on 

other qualifying salvage sales to cover the cost of preparing and administering the sales. The Timber 

Salvage Sales program is authorized by 16 U.S.C. 472(a).

National Institute of Food and Agriculture (NIFA)

Native American Institutions Endowment Fund

The Native American Institutions Endowment Fund was authorized by P.L. 103-382 and provided an 

initial installment to establish an endowment to benefit the 1994 land-grant institutions. The public law 

states that “This program will enhance educational opportunities for Native Americans by building 

educational capacity at these institutions in the areas of student recruitment and retention, curricula 

development, faculty preparation, instruction delivery systems, and scientific instrumentation for 

teaching.” While the principal (corpus) of the fund cannot be used, the interest that is earned on the 

endowment fund investments in Treasury instruments can be used for the purposes described above. 

After the close of a fiscal year, the income is distributed after making adjustments for the cost of 

administering the fund.

Other

Financial information is summarized for all other funds from dedicated collections with total assets 

less than $50 million listed below.

Natural Resources Conservation Service

• Damage Assessment and Restoration Revolving Fund

• Miscellaneous Contributed Funds 

Food Safety and Inspection Service

• Expenses and Refunds, Inspection of Farm Products

Agricultural Marketing Service

• Inspection and Weighing Services

• Perishable Agricultural Commodities Act 

• Wool Research, Development and Promotion Trust Fund

Animal Plant Health Inspection Service

• Miscellaneous Contributed Funds
114 Section II | Financial Information

Forest Service

• Acquisition of Lands for National Forests, Special Acts

• Administration of Rights-of-Way and Other Land Uses Fund

• Communications Site Administration

• Expenses, Brush Disposal

• Gifts and Bequests

• Donations for Forest and Rangeland Research

• Hardwood Technology Transfer and Applied Research Fund

• Land Between the Lakes Management Fund

• Land Between the Lakes Trust Fund

• Licensee Program

• Midewin National Prairie (MNP) Rental Fee Account

• Operation and Maintenance of Quarters

• Payment to Minnesota (Cook, Lake and Saint Louis Counties) from the National Forests Fund

• Quinault Special Management Area

• Range Betterment Fund

• Receipts for Construction of Administrative Improvements- Arizona and Taos, New Mexico Land 

Conveyance 

• Roads and Trails for States, National Forest Fund

• Timber Roads, Purchaser Elections

• Timber Sales Pipeline Restoration Fund 

Rural Development

• Alternative Agricultural Research and Commercialization Revolving Fund 

Agricultural Research Service

• Concessions Fees and Volunteer Services

• Gifts and Bequests

• Miscellaneous Contributed Funds 

National Agricultural Statistics Service

• Miscellaneous Contributed Funds

Economic Research Service

• Miscellaneous Contributed Funds

Foreign Agricultural Service

• Foreign Service National Separation Liability Trust Fund 

• Gifts and Bequests

• Miscellaneous Contributed Funds

Office of the Secretary

• Gifts and Bequests
USDA | 2023 Agency Financial Report 115

Office of Partnerships and Public Engagement

• Gifts and Bequests

Office of Communications

• Gifts and Bequests

Office of General Counsel

• Gifts and Bequests

Office of the Inspector General

• Inspector General Assets Forfeiture, Department of Justice

• Inspector General Assets Forfeiture, Department of Treasury
116 Section II | Financial Information

FY 2023 AMS AMS APHIS FS

Funds from Dedicated Collections

Expenses and Refunds, 

Inspection and Grading 

of Farm Products

Funds for 

Strengthening Markets, 

Income, and Supply

Agricultural 

Quarantine Inspection 

User Fee Account

Acquisition of 

Lands to Complete 

Land Exchanges

Cooperative 

Work

Land 

Acquisition

National 

Grasslands 

Receipts

National 

Forest Fund 

Receipts

National Parks and 

Public Land Legacy 

Restoration Fund

BALANCE SHEET

Intragovernmental

Fund Balance with Treasury $ 133 $ 916 $ 397 $ 57 $ 437 $ 315 $ 205 $ 181 $ 44

Investments, Net — — — — — — — — —

Accounts Receivable, Net — — — — — — — — 555

Advances and Prepayments — — — — — — — — 2

Other Assets — — 9 — — — — — —

Total Intragovernmental Assets 133 916 406 57 437 315 205 181 601

Other than Intragovernmental

Accounts Receivable, Net 24 — 163 — — — — 4 —

General Property, Plant, and Equipment, Net — — 3 46 8 40 — — 18

Advances and Prepayments — — — — — — — — —

Investments, Net — — — — — — — — —

Total Other than Intragovernmental 24 — 166 46 8 40 — 4 18

 Total Assets 157 916 572 103 445 355 205 185 619

Intragovernmental

Other Liabilities 10 — 3 — 1 — — — —

Total Intragovernmental Liabilities 10 — 3 — 1 — — — —

Other than Intragovernmental

Accounts Payable — 14 1 — 3 — — — 8

Federal Employee Benefits Payable 53 — — — — — — — —

Advances From Others and Deferred Revenue — — 56 — 77 — — — —

Other Liabilities 7 83 6 — 1 — 59 — 1

Total Other than Intragovernmental 60 97 63 — 81 — 59 — 9

 Total Liabilities 70 97 66 — 82 — 59 — 9

Unexpended Appropriations — — — — — — — — 592

Cumulative Results of Operations 87 819 506 103 363 355 146 185 18

 Total Liabilities and Net Position 157 916 572 103 445 355 205 185 619

STATEMENT OF NET COST

Gross Program Costs 233 1,293 235 5 86 80 68 — 126

Less Earned Revenues 204 7 817 16 114 — 88 1 —

Net Cost of Operations 29 1,286 (582) (11) (28) 80 (20) (1) 126

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

 Beginning Balance — — — — — — — — 446

 Appropriations Received — — — — — — — — —

 Appropriations Transferred In/Out — — — — — — — — 285

 Appropriations Used — — — — — — — — (139)

Total Unexpended Appropriations — — — — — — — — 592

Cumulative Results of Operations:

 Beginning Balances 76 828 438 92 335 311 210 188 4

 Appropriations Used — — — — — — — — 139

 Other than Intragovernmental Non-exchange Revenue:

 Miscellaneous Taxes and Receipts — — — — — — — — —

 Total Other than Intragovernmental Non-exchange Revenue — — — — — — — — —

 Intragovernmental Non-exchange Revenue — — — — — — — — —

 Donations and Forfeitures of Cash & Property — — — — — — — — —

 Transfers-In/out Without Reimbursement — 1,277 (514) — — 124 — — 1

 Imputed Financing 40 — — — — — — — —

 Other — — — — — — (84) (4) —

Net Cost of Operations (29) (1,286) 582 11 28 (80) 20 1 (126)

Net Change in Cumulative Results of Operations 11 (9) 68 11 28 44 (64) (3) 14

Total Cumulative Results of Operations 87 819 506 103 363 355 146 185 18

Net Position $ 87 $ 819 $ 506 $ 103 $ 363 $ 355 $ 146 $ 185 $ 610
USDA | 2023 Agency Financial Report 117

FY 2023 FS NIFA

Other Funds 

from 

Dedicated 

Collections

Total Funds 

from 

Dedicated 

Collections

Funds from Dedicated Collections

Payments to 

States, National 

Forests Fund

Recreation Fee 

Demonstration 

Program

Reforestation 

Trust Fund

Restoration of 

Forest Lands and 

Improvements

State and 

Private 

Forestry

Stewardship 

Contracting 

Product Sales

Timber 

Salvage 

Sales

Native American 

Institutions 

Endowment Fund

BALANCE SHEET

Intragovernmental

Fund Balance with Treasury $ 148 $ 200 $ 344 $ 340 $ 301 $ 94 $ 100 $ 14 $ 303 $ 4,529

Investments, Net — — — — — — — 274 6 280

Accounts Receivable, Net — — — — — — — — — 555

Advances and Prepayments — — — — — — — — — 2

Other Assets — — — — — — — — — 9

Total Intragovernmental Assets 148 200 344 340 301 94 100 288 309 5,375

Other than Intragovernmental

Accounts Receivable, Net — 2 — 5 — 26 — — 7 231

General Property, Plant, and Equipment, Net 2 1 1 1 — — 1 — 4 125

Advances and Prepayments — — — 1 5 — — — — 6

Investments, Net — — — — — — — — 3 3

Total Other than Intragovernmental 2 3 1 7 5 26 1 — 14 365

 Total Assets 150 203 345 347 306 120 101 288 323 5,740

Intragovernmental

Other Liabilities — — — — — — — — 1 15

Total Intragovernmental Liabilities — — — — — — — — 1 15

Other than Intragovernmental

Accounts Payable — 1 3 — — 1 — — 1 32

Federal Employee Benefits Payable — — — — — — — — — 53

Advances From Others and Deferred Revenue — — — — — — — — 14 147

Other Liabilities 252 2 1 — — 6 — — 10 428

Total Other than Intragovernmental 252 3 4 — — 7 — — 25 660

 Total Liabilities 252 3 4 — — 7 — — 26 675

Unexpended Appropriations — — — — — — — 225 1 818

Cumulative Results of Operations (102) 200 341 347 306 113 101 63 296 4,247

 Total Liabilities and Net Position 150 203 345 347 306 120 101 288 323 5,740

STATEMENT OF NET COST

Gross Program Costs 136 122 49 22 53 44 30 4 152 2,738

Less Earned Revenues 155 136 — — — 41 36 6 173 1,794

Net Cost of Operations (19) (14) 49 22 53 3 (6) (2) (21) 944

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — — — — — — — 214 1 661

Appropriations Received — — — — — — — 11 — 11

Appropriations Transferred In/Out — — — — — — — — — 285

Appropriations Used — — — — — — — — — (139)

Total Unexpended Appropriations — — — — — — — 225 1 818

Cumulative Results of Operations:

Beginning Balances (121) 186 232 257 280 116 95 61 290 3,878

Appropriations Used — — — — — — — — — 139

Other than Intragovernmental Non-exchange Revenue: —

Miscellaneous Taxes and Receipts — — — 5 — — — — — 5

Total Other than Intragovernmental Non-exchange Revenue — — — 5 — — — — — 5

Intragovernmental Non-exchange Revenue — — 158 106 — — — — — 264

Donations and Forfeitures of Cash & Property — — — — — — — — 1 1

Transfers-In/out Without Reimbursement — — — 1 79 — — — (16) 952

Imputed Financing — — — — — — — — — 40

Other — — — — — — — — — (88)

Net Cost of Operations 19 14 (49) (22) (53) (3) 6 2 21 (944)

Net Change in Cumulative Results of Operations 19 14 109 90 26 (3) 6 2 6 369

Total Cumulative Results of Operations (102) 200 341 347 306 113 101 63 296 4,247

Net Position $ (102) $ 200 $ 341 $ 347 $ 306 $ 113 $ 101 $ 288 $ 297 $ 5,065
118 Section II | Financial Information

FY 2022 AMS AMS APHIS FS

Funds from Dedicated Collections

Expenses and Refunds, 

Inspection and Grading 

of Farm Products

Funds for 

Strengthening Markets, 

Income, and Supply

Agricultural 

Quarantine Inspection 

User Fee Account

Acquisition of 

Lands to Complete 

Land Exchanges

Cooperative 

Work

Land 

Acquisition

National 

Grasslands 

Receipts

National 

Forest Fund

Receipts

National Parks and 

Public Land Legacy 

Restoration Fund

BALANCE SHEET

Intragovernmental

Fund Balance with Treasury $ 118 $ 904 $ 374 $ 45 $ 397 $ 271 $ 285 $ 182 $ 15

Investments, Net — — — — — — — — —

Accounts Receivable, Net — 1 — — — — — — 431

Advances and Prepayments — — — — — — — — 2

Total Intragovernmental Assets 118 905 374 45 397 271 285 182 448

Other than Intragovernmental

Accounts Receivable, Net 26 — 92 — — — — 6 —

General Property, Plant, and Equipment, Net — — 3 46 8 41 — — 5

Advances and Prepayments — — — — — — — — —

Investments, Net — — — — — — — — —

Total Other than Intragovernmental 26 — 95 46 8 41 — 6 5

 Total Assets 144 905 469 91 405 312 285 188 453

Intragovernmental

Other Liabilities 10 — 2 — — — — — —

Total Intragovernmental Liabilities 10 — 2 — — — — — —

Other than Intragovernmental

Accounts Payable — 6 1 — 2 — — — 2

Federal Employee Benefits Payable 51 — — — — — — — —

Advances From Others and Deferred Revenue — — 22 — 67 — — — —

Other Liabilities 6 70 6 — 1 — 74 — 1

Total Other than Intragovernmental 57 76 29 — 70 — 74 — 3

 Total Liabilities 67 76 31 — 70 — 74 — 3

Unexpended Appropriations — — — — — — — — 446

Cumulative Results of Operations 76 828 438 92 335 311 210 188 4

 Total Liabilities and Net Position 143 904 469 92 405 311 284 188 453

STATEMENT OF NET COST

Gross Program Costs 227 1,246 244 4 79 36 92 — 100

Less Earned Revenues 198 6 658 1 91 — 55 (5) —

Net Cost of Operations 29 1,240 (414) 3 (12) 36 37 5 100

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — — — — — — — — 265

Appropriations Received — — — — — — — — —

Appropriations Transferred In/Out — — — — — — — — 285

Appropriations Used — — — — — — — — (104)

Total Unexpended Appropriations — — — — — — — — 446

Cumulative Results of Operations:

Beginning Balances 75 870 261 95 323 226 134 182 —

Appropriations Used — — — — — — — — 104

Other than Intragovernmental Non-exchange Revenue:

Miscellaneous Taxes and Receipts — — — — — — — — —

Total Other than Intragovernmental Non-exchange Revenue — — — — — — — — —

Intragovernmental Non-exchange Revenue — — — — — — 331 26 —

Donations and Forfeitures of Cash & Property — — — — — — — — —

Transfers-In/out Without Reimbursement — 1,198 (236) — — 122 — — —

Imputed Financing 30 — — — — — — — —

Other — — — — — (1) (218) (15) —

Net Cost of Operations (29) (1,240) 413 (3) 12 (36) (37) (5) (100)

Net Change in Cumulative Results of Operations 1 (42) 177 (3) 12 85 76 6 4

Total Cumulative Results of Operations 76 828 438 92 335 311 210 188 4

Net Position $ 76 $ 828 $ 438 $ 92 $ 335 $ 311 $ 210 $ 188 $ 450
USDA | 2023 Agency Financial Report 119

FY 2022 FS NIFA

Other Funds 

from 

Dedicated 

Collections

Total Funds 

from 

Dedicated 

Collections

Funds from Dedicated Collections

Payments to 

States, National 

Forests Fund

Recreation Fee 

Demonstration 

Program

Reforestation 

Trust Fund

Restoration of 

Forest Lands and 

Improvements

State and 

Private 

Forestry

Stewardship 

Contracting 

Product Sales

Timber 

Salvage 

Sales

Native American 

Institutions 

Endowment Fund

BALANCE SHEET

Intragovernmental

Fund Balance with Treasury $ 126 $ 184 $ 232 $ 250 $ 277 $ 93 $ 94 $ 13 $ 300 $ 4,160

Investments, Net — — — — — — — 263 6 269

Accounts Receivable, Net — — — — — — — — — 432

Advances and Prepayments — — — — — — — — — 2

Total Intragovernmental Assets 126 184 232 250 277 93 94 276 306 4,863

Other than Intragovernmental

Accounts Receivable, Net — 2 — 5 — 28 — — 5 164

General Property, Plant, and Equipment, Net 2 1 — 1 — — 1 — 4 112

Advances and Prepayments — — — — 7 — — — — 7

Investments, Net — — — — — — — — 3 3

Total Other than Intragovernmental 2 3 — 6 7 28 1 — 12 286

 Total Assets 128 187 232 256 284 121 95 276 318 5,149

Intragovernmental

Other Liabilities — — — — — — — — 1 13

Total Intragovernmental Liabilities — — — — — — — — 1 13

Other than Intragovernmental

Accounts Payable — 1 1 — — — — — 1 14

Federal Employee Benefits Payable — — — — — — — — — 51

Advances From Others and Deferred Revenue — — — — — — — — 14 103

Other Liabilities 249 1 — — 5 5 1 — 10 429

Total Other than Intragovernmental 249 2 1 — 5 5 1 — 25 597

 Total Liabilities 249 2 1 — 5 5 1 — 26 610

Unexpended Appropriations — — — — — — — 214 1 661

Cumulative Results of Operations (121) 186 232 257 280 116 95 61 290 3,878

 Total Liabilities and Net Position 128 188 233 257 285 121 96 275 317 5,149

STATEMENT OF NET COST

Gross Program Costs 319 100 63 16 53 34 25 6 152 2,796

Less Earned Revenues 149 132 — — — 43 33 5 160 1,526

Net Cost of Operations 170 (32) 63 16 53 (9) (8) 1 (8) 1,270

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — — — — — — — 202 1 468

Appropriations Received — — — — — — — 12 — 12

Appropriations Transferred In/Out — — — — — — — — — 285

Appropriations Used — — — — — — — — — (104)

Total Unexpended Appropriations — — — — — — — 214 1 661

Cumulative Results of Operations:

Beginning Balances 48 154 33 268 249 107 87 62 299 3,473

Appropriations Used — — — — — — — — — 104

Other than Intragovernmental Non-exchange Revenue:

Miscellaneous Taxes and Receipts — — — 1 — — — — — 1

Total Other than Intragovernmental Non-exchange Revenue — — — 1 — — — — — 1

Intragovernmental Non-exchange Revenue — — 262 3 — — — — — 622

Donations and Forfeitures of Cash & Property — — — — — — — — 1 1

Transfers-In/out Without Reimbursement — — — 1 84 — — — (18) 1,151

Imputed Financing — — — — — — — — — 30

Other — — — — — — — — — (234)

Net Cost of Operations (169) 32 (63) (16) (53) 9 8 (1) 8 (1,270)

Net Change in Cumulative Results of Operations (169) 32 199 (11) 31 9 8 (1) (9) 405

Total Cumulative Results of Operations (121) 186 232 257 280 116 95 61 290 3,878

Net Position $ (121) $ 186 $ 232 $ 257 $ 280 $ 116 $ 95 $ 275 $ 291 $ 4,539
120 Section II | Financial Information

Note Disclosures Related to the Statement of Net Cost

NOTE 21: Suborganization Program Costs

FY 2023 FPAC Business 

Center FSA CCC RMA NRCS FNS FSIS AMS APHIS FS

Farm Production and Conservation:

Gross Costs $ 344 $ 6,550 $ 10,897 $ 21,860 $ 5,104 $ — $ — $ — $ — $ —

Less: Earned Revenue 9 554 293 5,518 52 — — — — —

Net Costs 335 5,996 10,604 16,342 5,052 — — — — —

Food, Nutrition, and Consumer Services:

Gross Costs — — — — — 173,440 — — — —

Less: Earned Revenue — — — — — 120 — — — —

Net Costs — — — — — 173,320 — — — —

Food Safety:

Gross Costs — — — — — — 1,530 — — —

Less: Earned Revenue — — — — — — 232 — — —

Net Costs — — — — — — 1,298 — — —

Marketing and Regulatory Programs:

Gross Costs — — — — — — — 3,155 2,213 —

Less: Earned Revenue — — — — — — — 321 1,106 —

Net Costs — — — — — — — 2,834 1,107 —

Natural Resources and Environment:

Gross Costs — — — — — — — — — 9,861

Less: Earned Revenue — — — — — — — — — 919

Net Costs — — — — — — — — — 8,942

Rural Development:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Research, Education, and Economics:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Trade and Foreign Agricultural Affairs:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Staff Offices:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Total Gross Costs 344 6,550 10,897 21,860 5,104 173,440 1,530 3,155 2,213 9,861

Less: Total Earned Revenue 9 554 293 5,518 52 120 232 321 1,106 919

Net Cost of Operations $ 335 $ 5,996 $ 10,604 $ 16,342 $ 5,052 $ 173,320 $ 1,298 $ 2,834 $ 1,107 $ 8,942
USDA | 2023 Agency Financial Report 121

FY 2023

RD ARS NASS NIFA ERS FAS Staff Offices

Combined 

Total

Intra-entity 

Eliminations

Consolidated 

Total

Farm Production and Conservation:

Gross Costs $ — $ — $ — $ — $ — $ — $ — $ 44,755 $ (1,892) $ 42,863

Less: Earned Revenue — — — — — — — 6,426 (28) 6,398

Net Costs — — — — — — — 38,329 (1,864) 36,465

Food, Nutrition, and Consumer Services:

Gross Costs — — — — — — — 173,440 (1,273) 172,167

Less: Earned Revenue — — — — — — — 120 (1) 119

Net Costs — — — — — — — 173,320 (1,272) 172,048

Food Safety:

Gross Costs — — — — — — — 1,530 (86) 1,444

Less: Earned Revenue — — — — — — — 232 (1) 231

Net Costs — — — — — — — 1,298 (85) 1,213

Marketing and Regulatory Programs:

Gross Costs — — — — — — — 5,368 (176) 5,192

Less: Earned Revenue — — — — — — — 1,427 (95) 1,332

Net Costs — — — — — — — 3,941 (81) 3,860

Natural Resources and Environment:

Gross Costs — — — — — — — 9,861 (239) 9,622

Less: Earned Revenue — — — — — — — 919 (14) 905

Net Costs — — — — — — — 8,942 (225) 8,717

Rural Development:

Gross Costs 6,267 — — — — — — 6,267 (90) 6,177

Less: Earned Revenue 3,579 — — — — — — 3,579 (10) 3,569

Net Costs 2,688 — — — — — — 2,688 (80) 2,608

Research, Education, and Economics:

Gross Costs — 1,959 251 1,837 104 — — 4,151 (232) 3,919

Less: Earned Revenue — 177 35 40 1 — — 253 (148) 105

Net Costs — 1,782 216 1,797 103 — — 3,898 (84) 3,814

Trade and Foreign Agricultural Affairs:

Gross Costs — — — — — 558 — 558 (26) 532

Less: Earned Revenue — — — — — 65 — 65 (46) 19

Net Costs — — — — — 493 — 493 20 513

Staff Offices:

Gross Costs — — — — — — 2,104 2,104 (142) 1,962

Less: Earned Revenue — — — — — — 1,419 1,419 (1,187) 232

Net Costs — — — — — — 685 685 1,045 1,730

Total Gross Costs 6,267 1,959 251 1,837 104 558 2,104 248,034 (4,156) 243,878

Less: Total Earned Revenue 3,579 177 35 40 1 65 1,419 14,440 (1,530) 12,910

Net Cost of Operations $ 2,688 $ 1,782 $ 216 $ 1,797 $ 103 $ 493 $ 685 $ 233,594 $ (2,626) $ 230,968
122 Section II | Financial Information

FY 2022 FPAC Business 

Center FSA CCC RMA NRCS FNS FSIS AMS APHIS FS

Farm Production and Conservation:

Gross Costs $ 333 $ 8,246 $ 8,522 $ 17,399 $ 4,311 $ — $ — $ — $ — $ —

Less: Earned Revenue 4 422 181 4,302 58 — — — — —

Net Costs 329 7,824 8,341 13,097 4,253 — — — — —

Food, Nutrition, and Consumer Services:

Gross Costs — — — — — 193,675 — — — —

Less: Earned Revenue — — — — — 95 — — — —

Net Costs — — — — — 193,580 — — — —

Food Safety:

Gross Costs — — — — — — 1,456 — — —

Less: Earned Revenue — — — — — — 248 — — —

Net Costs — — — — — — 1,208 — — —

Marketing and Regulatory Programs:

Gross Costs — — — — — — — 2,861 2,228 —

Less: Earned Revenue — — — — — — — 332 928 —

Net Costs — — — — — — — 2,529 1,300 —

Natural Resources and Environment:

Gross Costs — — — — — — — — — 9,305

Less: Earned Revenue — — — — — — — — — 797

Net Costs — — — — — — — — — 8,508

Rural Development:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Research, Education, and Economics:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Trade and Foreign Agricultural Affairs:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Staff Offices:

Gross Costs — — — — — — — — — —

Less: Earned Revenue — — — — — — — — — —

Net Costs — — — — — — — — — —

Total Gross Costs 333 8,246 8,522 17,399 4,311 193,675 1,456 2,861 2,228 9,305

Less: Total Earned Revenue 4 422 181 4,302 58 95 248 332 928 797

Net Cost of Operations $ 329 $ 7,824 $ 8,341 $ 13,097 $ 4,253 $ 193,580 $ 1,208 $ 2,529 $ 1,300 $ 8,508
USDA | 2023 Agency Financial Report 123

FY 2022

RD ARS NASS NIFA ERS FAS Staff Offices

Combined 

Total

Intra-entity 

Eliminations

Consolidated 

Total

Farm Production and Conservation:

Gross Costs $ — $ — $ — $ — $ — $ — $ — $ 38,811 $ (1,805) $ 37,006

Less: Earned Revenue — — — — — — — 4,967 (34) 4,933

Net Costs — — — — — — — 33,844 (1,771) 32,073

Food, Nutrition, and Consumer Services:

Gross Costs — — — — — — — 193,675 (1,211) 192,464

Less: Earned Revenue — — — — — — — 95 (1) 94

Net Costs — — — — — — — 193,580 (1,210) 192,370

Food Safety:

Gross Costs — — — — — — — 1,456 (82) 1,374

Less: Earned Revenue — — — — — — — 248 (2) 246

Net Costs — — — — — — — 1,208 (80) 1,128

Marketing and Regulatory Programs:

Gross Costs — — — — — — — 5,089 (196) 4,893

Less: Earned Revenue — — — — — — — 1,260 (98) 1,162

Net Costs — — — — — — — 3,829 (98) 3,731

Natural Resources and Environment:

Gross Costs — — — — — — — 9,305 (229) 9,076

Less: Earned Revenue — — — — — — — 797 (12) 785

Net Costs — — — — — — — 8,508 (217) 8,291

Rural Development:

Gross Costs 4,904 — — — — — — 4,904 (90) 4,814

Less: Earned Revenue 3,227 — — — — — — 3,227 (10) 3,217

Net Costs 1,677 — — — — — — 1,677 (80) 1,597

Research, Education, and Economics:

Gross Costs — 1,751 236 1,624 93 — — 3,704 (209) 3,495

Less: Earned Revenue — 174 19 32 3 — — 228 (146) 82

Net Costs — 1,577 217 1,592 90 — — 3,476 (63) 3,413

Trade and Foreign Agricultural Affairs:

Gross Costs — — — — — 488 — 488 (21) 467

Less: Earned Revenue — — — — — 79 — 79 (59) 20

Net Costs — — — — — 409 — 409 38 447

Staff Offices:

Gross Costs — — — — — — 1,980 1,980 (159) 1,821

Less: Earned Revenue — — — — — — 1,439 1,439 (1,196) 243

Net Costs — — — — — — 541 541 1,037 1,578

Total Gross Costs 4,904 1,751 236 1,624 93 488 1,980 259,412 (4,002) 255,410

Less: Total Earned Revenue 3,227 174 19 32 3 79 1,439 12,340 (1,558) 10,782

Net Cost of Operations $ 1,677 $ 1,577 $ 217 $ 1,592 $ 90 $ 409 $ 541 $ 247,072 $ (2,444) $ 244,628
124 Section II | Financial Information

Note Disclosures Related to the Statement of Budgetary Resources

NOTE 22: Statement of Budgetary Resources

Adjustments to Prior Year’s Ending Unobligated Balance Reported on Line 1020 

of the SF-133

In FY 2023, AMS made adjustments of $4 million to the Unobligated Balance Brought Forward, 

October 1 that will be reported on Line 1020 of the SF-133, Report on Budget Execution and 

Budgetary Resources. In FY 2022, CCC and RD made adjustments of $17 million and $4 million, 

respectively to the Unobligated Balance Brought Forward, October 1 that will be reported on line 1020 

of the SF-133, Report on Budget Execution and Budgetary Resources.

Terms of Borrowing Authority Used

The Secretary of Agriculture has the authority to make and issue notes to the Secretary of the Treasury 

for the purpose of discharging obligations for RD’s insurance funds and CCC’s non-reimbursed 

realized losses and debt related to foreign assistance programs. The permanent indefinite borrowing 

authority includes both interest bearing and non-interest bearing notes. These notes are drawn upon 

daily when disbursements exceed deposits. Notes payable under the permanent indefinite borrowing 

authority have a term of one year. On January 1 of each year, USDA refinances its outstanding 

borrowings, including accrued interest, at the January borrowing rate.

In addition, USDA has permanent indefinite borrowing authority for the foreign assistance and export 

credit programs to finance disbursements on post-credit reform, direct credit obligations, and credit 

guarantees. In accordance with the Federal Credit Reform Act of 1990, as amended, USDA borrows from 

Treasury on October 1, for the entire fiscal year, based on annual estimates of the difference between the 

amount appropriated (subsidy) and the amount to be disbursed to the borrower. Repayment under this 

agreement may be, in whole or in part, prior to maturity by paying the principal amount of the 

borrowings plus accrued interest to the date of repayment. Interest is paid on these borrowings based on 

weighted average interest rates for the cohort, to which the borrowings are associated. Interest is earned 

on the daily balance of uninvested funds in the credit reform financing funds maintained at Treasury. The 

interest income is used to reduce interest expense on the underlying borrowings.

USDA has authority to borrow from the Federal Financing Bank (FFB) in the form of Certificates of 

Beneficial Ownership (CBOs) or loans executed directly between the borrower and FFB with an 

unconditional USDA repayment guarantee. CBOs outstanding with FFB are generally secured by 

unpaid loan principal balances. CBOs outstanding are related to pre-credit reform loans and no longer 

used for program financing.

FFB CBOs are repaid as they mature and are not related to any particular group of loans. Borrowings 

made to finance loans directly between the borrower and FFB mature and are repaid as the related 

group of loans become due. Interest rates on the related group of loans are equal to interest rates on 
USDA | 2023 Agency Financial Report 125

FFB borrowings, except in those situations where an FFB funded loan is restructured and the terms of 

the loan are modified. Prepayments can be made on Treasury borrowings without a penalty; however, 

they cannot be made on FFB CBOs, without a penalty.

Funds may also be borrowed from private lending agencies and others. USDA reserves a sufficient 

amount of its borrowing authority to purchase, at any time, all notes and other obligations evidencing 

loans made by agencies and others. All bonds, notes, debentures, and similar obligations issued by the 

Department are subject to approval by the Secretary of the Treasury. Reservation of borrowing 

authority for these purposes has not been required for many years.

Available Borrowing Authority, End of Period

Available borrowing authority at September 30, 2023 and 2022 was $44,827 million and 

$47,175 million, respectively.

Undelivered Orders at the End of the Period

FY 2023 Federal Non-Federal FY 2022 Federal Non-Federal

Paid $ 104 $ 430 Paid $ 102 $ 493

Unpaid 26,309 95,021 Unpaid 4,287 83,055

Total $ 26,413 $ 95,451 Total $ 4,389 $ 83,548

Permanent Indefinite Appropriations

USDA has permanent indefinite appropriations available to fund (1) subsidy costs incurred under credit 

reform programs, (2) certain costs of the crop insurance program, (3) certain commodity program costs, 

(4) certain costs associated with FS programs, and (5) dairy indemnity payment program.

The permanent indefinite appropriations for credit reform are mainly available to finance any 

disbursements incurred under the liquidating accounts. These appropriations become available pursuant 

to standing provisions of law without further action by Congress after transmittal of the budget for the 

year involved. They are treated as permanent the first year they become available, as well as in 

succeeding years. However, they are not stated as specific amounts but are determined by specified 

variable factors, such as cash needs for liquidating accounts, and information about the actual 

performance of a cohort or estimated changes in future cash flows of the cohort in the program accounts.

The permanent indefinite appropriation for the crop insurance program is used to cover premium 

subsidy, delivery expenses, losses in excess of premiums, and research and delivery costs.

The permanent indefinite appropriation for commodity program costs is used to encourage the 

exportation of agricultural commodities and products, to encourage domestic consumption of agricultural 

products by diverting them, and to reestablish farmers’ purchasing power by making payments in 

connection with the normal production of any agricultural commodity for domestic consumption.
126 Section II | Financial Information

FS has multiple permanent indefinite appropriations which are used to make improvements to national 

forests and grasslands. These include Payments to Counties (National Grasslands), Restoration of Forest 

Lands and Improvements, Reforestation Trust Fund, Recreation Fee Demonstration Program, Brush 

Disposal, Timber Roads, Timber Salvage Sales, and Maintenance of Quarters. All permanent indefinite 

appropriations are funded by receipts made available by law and are available until expended.

The FSA has a permanent indefinite appropriation for the Dairy Indemnity Payment Program to 

provide payments to dairy producers when a public regulatory agency directs them to remove their raw 

milk from the commercial market because it has been contaminated by pesticides and other residues. 

Legal Arrangements Affecting Use of Unobligated Balances

Any information about legal arrangements affecting the use of the unobligated balance of budget 

authority is specifically stated by program and fiscal year in the appropriation language or in the 

alternative provisions section at the end of the appropriations act.

Explanation of Differences Between the SBR and the Budget of the U.S. 

Government

The differences between the FY 2022 Statement of Budgetary Resources and the FY 2022 actual 

numbers presented in the FY 2024 Budget of the United States Government (Budget) are 

summarized below.

FY 2022

Item

Budgetary 

Resources

New Obligations 

& Upward 

Adjustments 

(Total)

Distributed 

Offsetting 

Receipts Net Outlays

Combined Statement of Budgetary Resources $ 465,116 $ 298,515 $ (5,796) $ 257,930

Reconciling Items:

Expired Accounts (58,962) (3,435)

Adjustment to Correct Borrowing Authority Withdrawn and 

Obligations (CCC) (114) (106) — —

Timing Difference for Rural Housing Assistance Grants (RD) (3) (3) — —

Milk Market Orders Fund 66 66

Rounding (8) (6) — 1

Budget of the United States Government $ 406,095 $ 295,031 $ (5,796) $ 257,931

A comparison between the FY 2023 SBR and the FY 2023 actual numbers presented in the FY 2025 

Budget cannot be performed as the FY 2025 Budget is not yet available. The Budget with the actual 

amounts for the current year (i.e., FY 2023) will be available at a later date on the President’s OMB 

Budget website. 
USDA | 2023 Agency Financial Report 127

Note Disclosures Not Pertaining to a Specific Statement

NOTE 23: Incidental Custodial Collections

Custodial collections represent collections on land leases for resource extraction, National Forest Fund 

receipts from the sale of timber and other forest products, miscellaneous general fund receipts such as 

collections on accounts receivable related to canceled year appropriations, civil monetary penalties and 

interest, and commercial fines and penalties. Custodial collection activities are considered immaterial 

and incidental to the mission of the Department.

Item FY 2023 FY 2022

Total Custodial Revenue:

Sources of Cash Collections:

Miscellaneous $ 322 $ 199

Total Cash Collections 322 199

Accrual Adjustments 135 128

Total Custodial Revenue 457 327

Disposition of Collections:

Transferred to Others:

Treasury (442) (321)

(Increase)/Decrease in Amounts Yet to be Transferred (15) (6)

Total Disposition of Collections (457) (327)

Net Custodial Activity $ — $ —
128 Section II | Financial Information

NOTE 24: Fiduciary Activities

The department is responsible for one fiduciary fund. The Rural Housing Insurance Fund was 

established by P.L 89-117 pursuant to section 517 of title V of the Housing Act of 1949, which 

authorized RD to collect escrow payments on behalf of new and existing Single Family Housing 

borrowers. Other fiduciary activities by RD include but are not limited to collections from borrowers, 

interest paid on escrow accounts, and payments to insurance agencies and taxing authorities.

Schedule of Fiduciary Activity

For the years ended September 30, 2023 and 2022

Item Rural Housing Insurance Fund FY 2023 Rural Housing Insurance Fund FY 2022

Fiduciary Net Assets, Beginning of Year $ 99 $ 117

Contributions 458 456

Disbursements To and On Behalf of Beneficiaries (469) (474)

Increases/(Decrease) in Fiduciary Net Assets (11) (18)

Fiduciary Net Assets, End of Year $ 88 $ 99

Fiduciary Net Assets 

As of September 30, 2023 and 2022

Item Rural Housing Insurance Fund FY 2023 Rural Housing Insurance Fund FY 2022

Fiduciary Assets:

Cash and Cash Equivalents $ 88 $ 99

Total Fiduciary Net Assets $ 88 $ 99

NOTE 25: Reconciliation of Net Cost to Net Outlays 

(Budget to Accrual Reconciliation)

Budgetary and financial accounting information differ. Budgetary accounting is used for planning and 

control purposes and relates to both the receipt and use of cash, as well as reporting the Federal deficit. 

Financial accounting is intended to provide a picture of the government’s financial operations and 

financial position so it presents information on an accrual basis. The accrual basis includes information 

about costs arising from the consumption of assets and the incurrence of liabilities. The reconciliation 

of net outlays, presented on a budgetary basis, and the net cost, presented on an accrual basis, provides 

an explanation of the relationship between budgetary and financial accounting information. 

The reconciliation serves not only to identify costs paid for in the past and those that will be paid in the 

future, but also to assure integrity between budgetary and financial accounting. 
USDA | 2023 Agency Financial Report 129

The reconciliation explains the relationship between the net cost of operations and net outlays by 

presenting (1) components of net cost that are not part of net outlays (e.g. depreciation and 

amortization expenses of assets previously capitalized, change in asset/liabilities); (2) components of 

net outlays that are not part of net cost (e.g. acquisition of capital assets); and (3) other temporary 

timing difference (e.g. prior period adjustments due to correction of errors). The analysis below 

illustrates this reconciliation by listing the key differences between net cost and net outlays.

FY 2023 Intragovernmental

Other than 

Intragovernmental Total

Net Cost $ 6,074 $ 224,894 $ 230,968

Components of Net Cost Not Part of the Budgetary Outlays:

Property, Plant and Equipment Depreciation Expense — (396) (396)

Property, Plant and Equipment Disposals and Revaluations — (2) (2)

Year-End Credit Reform Subsidy Accrual Reestimates 3,736 — 3,736

Loan Modification Adjustment Transfers (3) — (3)

Exchange Revenue not Part of the SBR Outlays 102 703 805

Increase/(Decrease) in Assets:

Accounts Receivable, Net 102 423 525

Loans Receivable, Net (Non-FCRA) — (189) (189)

Securities and Investments 1 — 1

Other Assets 10 (44) (34)

(Increase)/Decrease in Liabilities

Accounts Payable 89 (1,798) (1,709)

Insurance and Guarantee Program Liabilities — (12) (12)

Environmental and Disposal Liabilities — (6) (6)

Benefits Due and Payable — (204) (204)

Federal Employee and Veteran Benefits Payable — (31) (31)

Other Liabilities (47) (1,044) (1,091)

Financing Sources:

Imputed Cost (1,317) — (1,317)

Total Components of Net Operating Cost Not Part of the Budgetary Outlays: 2,673 (2,600) 73

Components of the Budget Outlays That Are Not Part of the Net Operating Cost:

Acquisition of Capital Assets 1 677 678

Acquisitions of Inventory — (2) (2)

Financing Sources:

Donated Revenue — (3) (3)

Transfers Out (In) Without Reimbursements (135) — (135)

Total Components of the Budget Outlays that are not part of Net Operating Cost (134) 672 538

Miscellaneous Items:

Distributed Offsetting Receipts (268) (17) (285)

Custodial/Non-exchange revenue (420) 341 (79)

Non-Entity Activity (2,348) — (2,348)

Other Temporary Timing Differences — 20 20

Total Other Reconciling Items (3,036) 344 (2,692)

Total Net Outlays 5,577 223,310 228,887

Budgetary Agency Outlays, Net $ 228,887

In FY 2023, significant line items include Year-End Credit Reform Subsidy Accrual Reestimates 

mainly due to RD; Increase in Accounts Payable mainly due to payments for FSA Emergency Relief 

Program; Increase in Other Liabilities mainly due to payments for FSA Pandemic Assistance Revenue 

Program, Farm Loan Borrower Relief Program, and Emergency Grain Storage Facility Assistance 

Program; and payments for NRCS Partnership for Climate-Smart Commodities Program; and NonEntity Activity mainly due to RD downward reestimates and negative subsidy.
130 Section II | Financial Information

FY 2022 Intragovernmental

Other than 

Intragovernmental Total

Net Cost $ 5,144 $ 239,484 $ 244,628

Components of Net Cost Not Part of the Budgetary Outlays:

Property, Plant and Equipment Depreciation Expense — (341) (341)

Property, Plant and Equipment Disposals and Revaluations — (8) (8)

Cost of Goods Sold — (2) (2)

Year-End Credit Reform Subsidy Accrual Reestimates 4,081 — 4,081

Exchange Revenue not Part of the SBR Outlays 102 517 619

Increase/(Decrease) in Assets:

Accounts Receivable, Net 114 1,211 1,325

Loans Receivable, Net (Non-FCRA) — 30 30

Other Assets 18 (82) (64)

(Increase)/Decrease in Liabilities

Accounts Payable 59 (167) (108)

Insurance and Guarantee Program Liabilities — (3,099) (3,099)

Environmental and Disposal Liabilities — 17 17

Benefits Due and Payable — 101 101

Federal Employee and Veteran Benefits Payable — 42 42

Other Liabilities 44 3,566 3,610

Financing Sources:

Imputed Cost (1,005) — (1,005)

Total Components of Net Operating Cost Not Part of the Budgetary Outlays: 3,413 1,785 5,198

Components of the Budget Outlays That Are Not Part of the Net Operating Cost:

Acquisition of Capital Assets 1 595 596

Acquisitions of Inventory — 6 6

Financing Sources:

Donated Revenue — (3) (3)

Transfers Out (In) Without Reimbursements (155) — (155)

Total Components of the Budget Outlays that are not part of Net Operating Cost (154) 598 444

Miscellaneous Items:

Distributed Offsetting Receipts (175) (7) (182)

Custodial/Non-exchange revenue (360) 205 (155)

Non-Entity Activity (4,708) — (4,708)

Other Temporary Timing Differences 10 — 10

Total Other Reconciling Items (5,233) 198 (5,035)

Total Net Outlays 3,170 242,065 245,235

Budgetary Agency Outlays, Net $ 245,235

In FY 2022, significant line items include Year-End Credit Reform Subsidy Accrual Reestimates 

mainly due to RD; Increase in Accounts Receivable, Net mainly due to RMA higher reported 

premiums for certain crops and Forest Service Great American Outdoors Act; Increase in Insurance 

and Guarantee Program Liabilities mainly due to RMA higher coverage amounts resulting from higher 

crop prices, higher level of losses caused by widespread drought and excessive heat, and increased 

participation in certain insurance products; Decrease in Other Liabilities mainly due to CCC accrual 

for ARC/PLC and FSA accrual for socially disadvantage borrowers under the American Rescue Plan; 

and Non-Entity Activity mainly due to RD downward reestimates and negative subsidy. 
USDA | 2023 Agency Financial Report 131

NOTE 26: Disclosure Entities and Related Parties 

Disclosure Entities

Research and Promotion Boards

Research and Promotion (“checkoff”) programs are authorized by the Commodity Promotion, 

Research, and Information Act of 1996 and various Acts for specific commodities. Research and 

Promotion Board members are appointed by the Secretary. AMS is responsible for administrative 

oversight of Research and Promotion Programs to ensure fiscal accountability and program integrity. 

AMS also conducts rulemaking and oversees the activities of Fruit, Vegetable, and Specialty Crop 

Marketing Order Commodity Boards, Councils, or Committees to ensure compliance with all legal and 

regulatory requirements. Marketing orders and agreements are authorized by the Agricultural 

Marketing Agreement Act of 1937. 

These programs are not federally funded. In FY 2023, the non-Federal costs of oversight for the 

Research and Promotion activities, including salaries and expenses, travel, and rent for office space 

were estimated to be $5.4 million. Industry boards collect and manage assessments from industry 

members to conduct program activities. 

Foundation for Food and Agricultural Research (FFAR)

The Secretary of Agriculture (Secretary) was authorized by the Agricultural Act of 2014 (Act), to 

establish a nonprofit corporation known as the Foundation for Food and Agriculture Research. FFAR 

was established by the Secretary on July 23, 2014. To establish the funding, on the date of the 

enactment of this Act, the Secretary transferred $200 million of the Commodity Credit Corporation 

funds, to the FFAR, to remain available until expended under the conditions stipulated. On the date on 

which the strategic plan was submitted, the Secretary transferred $185 million of the Commodity 

Credit Corporation Funds, to the FFAR, to remain available until expended. The FFAR may use the 

funds made available to carry out the purposes of the FFAR only to the extent that the FFAR secures an 

equal amount of non-Federal matching funds for each expenditure. None of the funds made available 

may be used for construction. 

The purposes of FFAR shall be (a) to advance the research mission of the USDA by supporting 

agricultural research activities focused on addressing key problems of national and international 

significance; and (b) to foster collaboration with agricultural researchers from the Federal Government, 

State (as defined in section 1404 of the National Agricultural Research, Extension, and Teaching Policy 

Act of 1977 (7 U.S.C. 3103)) governments, institutions of higher education (as defined in section 101 of 

the Higher Education Act of 1965 (20 U.S.C. 1001)), industry, and nonprofit organizations. The 

activities of the FFAR shall be supplemental to any other activities at USDA and shall not preempt any 

authority or responsibility of USDA under another provision of law; (c) to advance other incidental 

activities necessary to carry out and accomplish the foregoing missions enumerated.
132 Section II | Financial Information

FFAR is managed under the direction of the Board of Directors (Board), which may exercise all such 

authority and powers of the Foundation and do all such lawful acts and things as provided by statute, 

the Articles of Incorporation, or the By-laws. The Board is composed of designated or appointed Ex 

Officio Directors (non-voting) and Appointed Directors (voting), appointed in accordance with the 

Agricultural Act or these By-Laws. The number of Appointed Directors may increase or decrease, from 

time to time, but at no time be less than 15 and no more than 21 members. No employee of the Federal 

Government shall be an Appointed Director.

The ex-officio members of the Board consist of the following:

(i) The Secretary 

(ii) The Under Secretary of Agriculture for Research, Education, and Economics

(iii) The Administrator of the Agricultural Research Service

(iv) The Director of the National Institute of Food and Agriculture

(v) The Director of the National Science Foundation

The ex-officio members by majority-vote appoint 15 individuals to the Board. The Board elects from 

among the members of the Board, an individual to serve as Chair of the Board. The Board hires an 

Executive Director who shall carry out such duties and responsibilities as the Board may prescribe. 

The Executive Director shall ensure that any funds received are held in separate accounts from funds 

received from nongovernmental entities.

To ensure integrity in the operations of the FFAR, the Board developed and enforced procedures 

relating to standards of conduct, financial disclosure statements, conflicts of interest (including recusal 

and waiver rules), audits, and any other matters determined appropriate by the Board.

Any individual who is an officer, employee, or member of the Board is prohibited from any 

participation in deliberations by the FFAR of a matter that would directly or predictably affect any 

financial interest of—

(i) the individual;

(ii) a relative (as defined in section 109 of the Ethics in Government Act of 1978 

(5 U.S.C. App.109)) of that individual; or

(iii) a business organization or other entity in which the individual has an interest, including an 

organization or other entity with which the individual is negotiating employment.

Members of the Board may not receive compensation for service on the Board but may be reimbursed 

for travel, the reasonable cost of meals and lodging, and other necessary expenses incurred in carrying 

out the duties of the Board.

The Board of Directors designate and appoint standing committees of the Board: an Executive 

Committee, a Governance and Federal Relations Committee, a Finance, Risk and Audit Committee, a 

Development Committee, and a Scientific Programs Committee. Committees consist of at least four 
USDA | 2023 Agency Financial Report 133

appointed Directors possessing the qualifications determined necessary by the Board and shall be 

comprised solely of Members of the Board. The Finance, Risk and Audit Committee provides annual 

audits of its financial condition to the Secretary of Agriculture and the Comptroller General of the 

United States for examination or audit.

Additional FFAR governance, financial, and audit reports can be located on the Foundation for Food & 

Agriculture Research website.

Related Party

Milk Market Orders Assessment Fund

The Secretary of Agriculture is authorized by the Agricultural Marketing Agreement Act of 1937, as 

amended under certain conditions to issue Federal milk marketing orders establishing minimum prices 

which handlers are required to pay for milk purchased from producers. There are currently 11 federally 

sanctioned milk market orders in operation. Market administrators are appointed by the Secretary and are 

responsible for carrying out the terms of specific marketing orders. Their operating expenses are financed 

by assessments on regulated handlers and partly by deductions from producers, which are reported to 

AMS. Most of these funds are collected and deposited in checking and savings accounts in local banks 

and disbursed directly for direct disbursement by the market administrator. A portion of the funds 

collected may be invested in securities such as certificates of deposit. Expenses of local offices are met 

from an administrative fund and a marketing service fund, which are prescribed in each order. The 

administrative fund is derived from prorated handler assessments. The marketing service fund of the 

individual order disseminates market information to producers who are not members of a qualified 

cooperative. It also provides for the verification of the weights, sampling, and testing of milk from these 

producers. The cost of these services is borne by such producers. The maximum rates for administrative 

assessment and for marketing services are set forth in each order and adjustments below these rates are 

made from time to time upon recommendations by the market administrator and upon approval of the 

AMS to provide reserves at about a six-month operating level. Upon termination of any order, the statute 

provides for distributing the proceeds from net assets pro rata to contributing handlers or producers.

The AMS reports this account in the President’s Budget because milk marketing administration staff 

are excepted service. Salaries, health insurance, Thrift Savings Plan contributions and all other Federal 

benefits are paid by the marketing order funds and as a result there are no costs to the Federal 

Government. As a result, corresponding dollars are reported for presentation purposes only. 

In FY 2023, the non-Federal costs of administrating Federal milk marketing orders, including salaries 

and expenses, travel, and rent for office space were estimated to be $64.6 million. The Secretary’s 

oversight responsibilities of marketing orders by AMS is funded by the Funds for Strengthening 

Markets, Income and Supply (Section 32) account.
134 Section II | Financial Information

NOTE 27: COVID-19 Activity

The tables below summarize supplemental funding for COVID-19 and its financial statement impact.

FY 2023

Account Name

Treasury 

Account 

Symbol Purpose

Budgetary 

Resources: 

Unobligated (and 

unexpired) 

Balance Carried 

Forward from 

Prior Year

New Budget 

Authority 

Rescissions/ 

Other 

Changes to 

Budgetary 

Resources

Budgetary 

Resources 

Obligated

Budgetary 

Resources: Ending 

Unobligated (and 

unexpired) 

Balance to 

be Carried 

Forward

Outlays, 

Net (Total)

FNS-Supplemental Nutrition Assistance Program (SNAP) 1233505 Consolidated Appropriations Act, 2021 $ — $ 34,500 $ — $ (23,107) $ 11,393 $ 12,704

FNS-SNAP 12X3505 Consolidated Appropriations Act, 2021 3 — — — 3 —

FNS-SNAP 121/33505 American Rescue Plan Act 507 — 114 (607) 14 547

FNS-SNAP 121/63505 American Rescue Plan Act 25 — — (7) 18 1

FNS-SNAP 121/73505 American Rescue Plan Act 23 — — (23) — 28

FNS-Special Supplemental Nutrition Program for Women, Infants 

and Children (WIC) 121/43510 American Rescue Plan Act 308 — — (300) 8 31

AMS - Marketing Services 12X2500 Consolidated Appropriations Act, 2021 397 — (389) (8) — 45

AMS - Payments to States and Possessions 12X2501 Consolidated Appropriations Act, 2021 — — — — — 23

APHIS- Salaries and Expenses 12X1600 American Rescue Plan Act 257 — (11) (246) — 26

Rural Development- Distance Learning, Telemedicine, and 

Broadband Program 12X1232 CARES Act 1 — — — 1 4

Rural Development- Rural Community Facilities Program Account 121/31951 American Rescue Plan Act 133 — 43 (176) — 68

Rural Development Rural Housing Insurance Fund Program Account 121/32081 American Rescue Plan Act 35 — (5) (29) 1 26

Rural Development Rural Cooperative Development Grants 12X1900 Consolidated Appropriations Act, 2021 1 — (1) — — 11

NIFA - Farming Opportunities Training and Outreach Program; Farm 

Stress Program; Gus Schumacher Nutrition Incentive Program 12X0502 Consolidated Appropriations Act, 2021 — — — — — 43

Office of the Secretary 12X0115 CARES Act 1,452 — 11 (645) 818 558

Office of the Secretary 12X0115

CARES Act and Consolidated 

Appropriations Act, 2021 2,355 — (254) (1,999) 102 641

Office of the Secretary 12X0115 American Rescue Plan Act 31 — (4) (23) 4 25

Office of the Secretary 12X0408 American Rescue Plan Act 1,778 — (328) (1,449) 1 216

Total $ 7,306 $ 34,500 $ (824) $ (28,619) $ 12,363 $ 14,997
USDA | 2023 Agency Financial Report 135

FY 2023

Item

Account Name FNS-Supplemental 

Nutrition Assistance 

Program (SNAP) FNS-SNAP FNS-SNAP FNS-SNAP FNS-SNAP

FNS-Special 

Supplemental 

Nutrition Program for 

Women, Infants and 

Children (WIC)

AMS-Marketing 

Services

AMS-Payments to 

States and 

Possessions

Treasury Account Symbol 1233505 12X3505 121/33505 121/63505 121/73505 121/43510 12X2500 12X2501

Purpose

Consolidated 

Appropriations Act, 

2021

Consolidated 

Appropriations Act, 

2021

American Rescue 

Plan Act

American Rescue 

Plan Act

American Rescue 

Plan Act

American Rescue Plan 

Act

Consolidated 

Appropriations Act, 

2021

Consolidated 

Appropriations Act, 

2021

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ 21,796 $ 3 $ 226 $ 24 $ 30 $ 358 $ 51 $ 70

Advances and Prepayments — — — — — — — —

Total Intragovernmental Assets 21,796 3 226 24 30 358 51 70

Accounts Receivable, Net (Note 6) — — — — — — — —

Property, Plant, and Equipment, Net (Note 9) — — — — — — — —

Advances and Prepayments — — — — — — — —

Total Assets 21,796 3 226 24 30 358 51 70

Accounts Payable — — — — — — — —

Benefits Due and Payable 415 — 209 5 30 — — —

Other Liabilities (Notes 17, 18 & 19) — — — — — 268 — —

Total Liabilities 415 — 209 5 30 268 — —

Unexpended Appropriations 21,381 3 17 19 — 90 51 70

Cumulative Results of Operations — — — — — — — —

Total Liabilities and Net Position 21,796 3 226 24 30 358 51 70

STATEMENT OF NET COST

Gross Program Costs 13,119 — 482 6 23 244 45 23

Less: Earned Revenues — — — — — — — —

Net Cost of Operations (Notes 21 & 25) 13,119 — 482 6 23 244 45 23

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — 3 507 25 23 334 487 93

Appropriations Received 34,500 — — — — — — —

Other Adjustments — — (8) — — — (391) —

Appropriations Used (13,119) — (482) (6) (23) (244) (45) (23)

Net Change in Unexpended Appropriations 21,381 — (490) (6) (23) (244) (436) (23)

Total Unexpended Appropriations 21,381 3 17 19 — 90 51 70

Cumulative Results of Operations:

Beginning Balance — — — — — — — —

Appropriations Used 13,119 — 482 6 23 244 45 23

Net Cost of Operations (13,119) — (482) (6) (23) (244) (45) (23)

Net Change in Cumulative Results of Operations — — — — — — — —

Total Cumulative Results of Operations — — — — — — — —

Net Position $ 21,381 $ 3 $ 17 $ 19 $ — $ 90 $ 51 $ 70
136 Section II | Financial Information

FY 2023

Account Name

APHIS- Salaries and 

Expenses

Rural DevelopmentDistance Learning, 

Telemedicine, and 

Broadband Program

Rural DevelopmentRural Community 

Faculties Program 

Account

Rural Development 

Rural Housing 

Insurance Fund 

Program Account

Rural Development 

Rural Cooperative 

Development Grants

NIFA-Farming Opportunities 

Training and Outreach 

Program; Farm Stress Program; 

Gus Schumacher Nutrition 

Incentive Program

Office of the 

Secretary

Treasury Account Symbol 12X1600 12X1232 121/31951 121/32081 12X1900 12X0502 12X0115

Purpose American Rescue 

Plan Act CARES Act

American Rescue 

Plan Act

American Rescue 

Plan Act

Consolidated 

Appropriations Act, 

2021

Consolidated Appropriations 

Act, 2021 CARES Act

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ 253 $ 15 $ 353 $ 5 $ 12 $ 63 $ 1,088

Advances and Prepayments 1 — — — — — —

Total Intragovernmental Assets 254 15 353 5 12 63 1,088

Accounts Receivable, Net (Note 6) — — — — — — 25

Property, Plant, and Equipment, Net (Note 9) 3 — — — — — —

Advances and Prepayments — — — — — — —

Total Assets 257 15 353 5 12 63 1,113

Accounts Payable 1 — — — — — 6

Benefits Due and Payable — — — — — — —

Other Liabilities (Notes 17, 18 & 19) — — — — — — 67

Total Liabilities 1 — — — — — 73

Unexpended Appropriations 253 15 353 5 12 63 37

Cumulative Results of Operations 3 — — — — — 1,003

Total Liabilities and Net Position 257 15 353 5 12 63 1,113

STATEMENT OF NET COST

Gross Program Costs 22 4 83 26 11 43 601

Less: Earned Revenues — — (15) — — — —

Net Cost of Operations (Notes 21 & 25) 22 4 68 26 11 43 601

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance 294 19 423 36 24 106 310

Appropriations Received — — — — — — —

Other Adjustments (16) — (2) (5) (1) — (23)

Appropriations Used (25) (4) (68) (26) (11) (43) (250)

Net Change in Unexpended Appropriations (41) (4) (70) (31) (12) (43) (273)

Total Unexpended Appropriations 253 15 353 5 12 63 37

Cumulative Results of Operations:

Beginning Balance — — — — — — 1,354

Appropriations Used 25 4 68 26 11 43 250

Net Cost of Operations (22) (4) (68) (26) (11) (43) (601)

Net Change in Cumulative Results of Operations 3 — — — — — (351)

Total Cumulative Results of Operations 3 — — — — — 1,003

Net Position $ 256 $ 15 $ 353 $ 5 $ 12 $ 63 $ 1,040
USDA | 2023 Agency Financial Report 137

FY 2023

Account Name Office of the 

Secretary

Office of the 

Secretary

Office of the 

Secretary

Treasury Account Symbol 12X0115 12X0115 12X0408

Purpose

CARES Act and 

Consolidated 

Appropriations Act, 

2021

American Rescue Plan 

Act

American Rescue Plan 

Act Total

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ 1,602 $ 91 $ 2,029 $ 28,069

Advances and Prepayments — — — 1

Total Intragovernmental Assets 1,602 91 2,029 28,070

Accounts Receivable, Net (Note 6) 3 — — 28

Property, Plant, and Equipment, Net (Note 9) 1 — — 4

Advances and Prepayments 1 — 3 4

Total Assets 1,607 91 2,032 28,106

Accounts Payable 1 — — 8

Benefits Due and Payable — — — 659

Other Liabilities (Notes 17, 18 & 19) 326 — 253 914

Total Liabilities 327 — 253 1,581

Unexpended Appropriations 1,277 91 1,779 25,516

Cumulative Results of Operations 3 — — 1,009

Total Liabilities and Net Position 1,607 91 2,032 28,106

STATEMENT OF NET COST

Gross Program Costs 958 25 358 16,073

Less: Earned Revenues — — — (15)

Net Cost of Operations (Notes 21 & 25) 958 25 358 16,058

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance 2,547 120 2,467 7,818

Appropriations Received — — — 34,500

Other Adjustments (311) (4) (330) (1,091)

Appropriations Used (959) (25) (358) (15,711)

Net Change in Unexpended Appropriations (1,270) (29) (688) 17,698

Total Unexpended Appropriations 1,277 91 1,779 25,516

Cumulative Results of Operations:

Beginning Balance 2 — — 1,356

Appropriations Used 959 25 358 15,711

Net Cost of Operations (958) (25) (358) (16,058)

Net Change in Cumulative Results of Operations 1 — — (347)

Total Cumulative Results of Operations 3 — — 1,009

Net Position $ 1,280 $ 91 $ 1,779 $ 26,525
138 Section II | Financial Information

FY 2022

Item

Account Name

Treasury 

Account 

Symbol Purpose

Budgetary 

Resources: 

Unobligated (and 

unexpired) 

Balance Carried

Forward from 

Prior Year

New Budget 

Authority

Rescissions/ 

Other 

Changes to 

Budgetary 

Resources

Budgetary 

Resources 

Obligated

Budgetary 

Resources: Ending 

Unobligated (and 

unexpired) 

Balance to

be Carried 

Forward

Outlays, 

Net (Total)

Farm Service Agency / Commodity Credit Corporation (CCC) -

Assistance for Socially Disadvantaged Farmers and Ranchers 12X0172 American Rescue Plan Act $ — $ — $ — $ — $ — $ (1)

CCC- Food for Peace Title II Grants (Foreign Agricultural Service) 121/22278 American Rescue Plan Act 152 — 3 (151) 4 560

FNS-Supplemental Nutrition Assistance Program (SNAP) 1223505 Consolidated Appropriations Act, 2021 — 29,300 — (25,971) 3,329 25,603

FNS-SNAP 12X3505 Consolidated Appropriations Act, 2021 5 — — (2) 3 2

FNS-SNAP 121/33505 American Rescue Plan Act 909 — 43 (445) 507 326

FNS-SNAP 121/63505 American Rescue Plan Act 25 — — — 25 —

FNS-SNAP 121/73505 American Rescue Plan Act 34 — — (11) 23 766

FNS-Commodities Assistance Program (CAP) 121/23507 American Rescue Plan Act — — 1 — 1 22

FNS-Special Supplemental Nutrition Program for Women, Infants 

and Children (WIC) 121/23510 American Rescue Plan Act — — 263 (47) 216 159

FNS-WIC 121/43510 American Rescue Plan Act 390 — — (82) 308 1

AMS - Marketing Services 12X2500 Consolidated Appropriations Act, 2021 515 — — (118) 397 33

AMS - Payments to States and Possessions 12X2501 Consolidated Appropriations Act, 2021 97 — — (97) — 6

APHIS- Salaries and Expenses 121/21600 Consolidated Appropriations Act, 2021 102 — (102) — — —

APHIS- Salaries and Expenses 12X1600 American Rescue Plan Act 300 — — (43) 257 5

APHIS- Salaries and Expenses 122/31600 Consolidated Appropriations Act, 2021 — — — — — —

Rural Development- Distance Learning, Telemedicine, and 

Broadband Program 12X1232 CARES Act — — 1 — 1 5

Rural Development- Rental Assistance Program 121/20137 American Rescue Plan Act — — — — — 63

Rural Development- Rural Community Facilities Program Account 121/31951 American Rescue Plan Act 475 — — (342) 133 52

Rural Development Rural Housing Insurance Fund Program 

Account 121/32081 American Rescue Plan Act 38 — — (3) 35 2

Rural Development Rural Cooperative Development Grants 12X1900 Consolidated Appropriations Act, 2021 3 — 1 (3) 1 11

NIFA - Farming Opportunities Training and Outreach Program; Farm 

Stress Program; Gus Schumacher Nutrition Incentive Program 12X0502 Consolidated Appropriations Act, 2021 18 — (1) (17) — 34

Office of the Secretary 12X0115 CARES Act 3,886 — (550) (1,884) 1,452 1,662

Office of the Secretary 12X0115

CARES Act and Consolidated 

Appropriations Act, 2021 3,298 — (384) (559) 2,355 683

Office of the Secretary 12X0115 American Rescue Plan Act 4,656 (3,600) (929) (96) 31 8

Office of the Secretary 12X0408 American Rescue Plan Act — 3,600 (1,000) (822) 1,778 25

Total $ 14,903 $ 29,300 $ (2,654) $ (30,693) $ 10,856 $ 30,027
USDA | 2023 Agency Financial Report 139

FY 2022

Account Name

Farm Service Agency / 

Commodity Credit 

Corporation (CCC) - Assistance 

for Socially Disadvantaged 

Farmers and Ranchers

CCC- Food for Peace 

Title II Grants 

(Foreign Agricultural 

Service)

FNS-Supplemental 

Nutrition 

Assistance 

Program (SNAP) FNS-SNAP FNS-SNAP FNS-SNAP FNS-SNAP

FNS-Commodity 

Assistance 

Program (CAP)

Treasury Account Symbol 12X0172 121/22278 1223505 12X3505 121/33505 121/63505 121/73505 121/23507

Purpose

American Rescue Plan Act

American Rescue 

Plan Act

Consolidated 

Appropriations 

Act, 2021

Consolidated 

Appropriations 

Act, 2021

American Rescue 

Plan Act

American Rescue 

Plan Act

American Rescue 

Plan Act

American Rescue 

Plan Act

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ — $ 31 $ 3,697 $ 3 $ 781 $ 25 $ 58 $ —

Total Intragovernmental Assets — 31 3,697 3 781 25 58 —

Accounts Receivable, Net (Note 6) — — — — — — — —

Inventory and Related Property, Net (Note 8) — 8 — — — — — —

Total Assets — 39 3,697 3 781 25 58 —

Accounts Payable — 1 — — — — — —

Benefits Due and Payable — — 368 — 274 — 35 —

Other Liabilities (Notes 17, 18 & 19) — 4 — — — — — —

Total Liabilities — 5 368 — 274 — 35 —

Unexpended Appropriations — 26 3,329 3 507 25 23 —

Cumulative Results of Operations — 8 — — — — — —

Total Liabilities and Net Position — 39 3,697 3 781 25 58 —

STATEMENT OF NET COST

Gross Program Costs (1,960) 463 25,971 2 402 — 11 21

Net Cost of Operations (Notes 21 & 25) (1,960) 463 25,971 2 402 — 11 21

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — 483 — 5 909 25 34 21

Appropriations Received — — 29,300 — — — — —

Appropriations Transferred in/out — — — — — — — —

Other Adjustments (1,960) — — — — — — —

Appropriations Used 1,960 (457) (25,971) (2) (402) — (11) (21)

Net Change in Unexpended Appropriations — (457) 3,329 (2) (402) — (11) (21)

Total Unexpended Appropriations — 26 3,329 3 507 25 23 —

Cumulative Results of Operations:

Beginning Balance — 14 — — — — — —

Appropriations Used (1,960) 457 25,971 2 402 — 11 21

Net Cost of Operations 1,960 (463) (25,971) (2) (402) — (11) (21)

Net Change in Cumulative Results of Operations — (6) — — — — — —

Total Cumulative Results of Operations — 8 — — — — — —

Net Position $ — $ 34 $ 3,329 $ 3 $ 507 $ 25 $ 23 $ —
140 Section II | Financial Information

FY 2022

Account Name

FNS-Special 

Supplemental 

Nutrition Program 

for Women, Infants 

and Children (WIC) FNS-WIC

AMS-Marketing 

Services

AMS-Payments to 

States and 

Possessions

APHIS- Salaries and 

Expenses

APHIS- Salaries and 

Expenses

APHIS- Salaries and 

Expenses

Rural DevelopmentDistance Learning, 

Telemedicine, and 

Broadband Program

Treasury Account Symbol 121/23510 121/43510 12X2500 12X2501 121/21600 12X1600 122/31600 12X1232

Purpose American Rescue 

Plan Act

American Rescue 

Plan Act

Consolidated 

Appropriations Act, 

2021

Consolidated 

Appropriations Act, 

2021

Consolidated 

Appropriations Act, 

2021

American Rescue 

Plan Act

Consolidated 

Appropriations Act, 

2021 CARES Act

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ 217 $ 389 $ 487 $ 93 $ — $ 295 $ — $ 19

Total Intragovernmental Assets 217 389 487 93 — 295 — 19

Accounts Receivable, Net (Note 6) — — — — — — — —

Inventory and Related Property, Net (Note 8) — — — — — — — —

Total Assets 217 389 487 93 — 295 — 19

Accounts Payable — — — — — — — —

Benefits Due and Payable — — — — — — — —

Other Liabilities (Notes 17, 18 & 19) — 55 — — — — — —

Total Liabilities — 55 — — — — — —

Unexpended Appropriations 217 334 487 93 — 295 — 19

Cumulative Results of Operations — — — — — — — —

Total Liabilities and Net Position 217 389 487 93 — 295 — 19

STATEMENT OF NET COST

Gross Program Costs (217) 56 33 6 — 5 — 5

Net Cost of Operations (Notes 21 & 25) (217) 56 33 6 — 5 — 5

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — 390 520 99 102 300 — 24

Appropriations Received — — — — — — 250 —

Appropriations Transferred in/out — — — — (102) — (250) —

Other Adjustments — — — — — — — —

Appropriations Used 217 (56) (33) (6) — (5) — (5)

Net Change in Unexpended Appropriations 217 (56) (33) (6) (102) (5) — (5)

Total Unexpended Appropriations 217 334 487 93 — 295 — 19

Cumulative Results of Operations:

Beginning Balance — — — — — — — —

Appropriations Used (217) 56 33 6 — 5 — 5

Net Cost of Operations 217 (56) (33) (6) — (5) — (5)

Net Change in Cumulative Results of Operations — — — — — — — —

Total Cumulative Results of Operations — — — — — — — —

Net Position $ 217 $ 334 $ 487 $ 93 $ — $ 295 $ — $ 19
USDA | 2023 Agency Financial Report 141

FY 2022

Account Name Rural DevelopmentRental Assistance 

Program

Rural DevelopmentRural Community 

Faculties Program 

Account

Rural Development 

Rural Housing 

Insurance Fund 

Program Account

Rural Development 

Rural Cooperative 

Development 

Grants

NIFA-Farming 

Opportunities Training and 

Outreach Program; Farm 

Stress Program; Gus 

Schumacher Nutrition 

Incentive Program

Office of the 

Secretary

Office of the 

Secretary

Office of the 

Secretary

Treasury Account Symbol 121/20137 121/31951 121/32081 12X1900 12X0502 12X0115 12X0115 12X0115

Purpose American Rescue 

Plan Act

American Rescue 

Plan Act

American Rescue 

Plan Act

Consolidated 

Appropriations Act, 

2021

Consolidated 

Appropriations Act, 2021 CARES Act

CARES Act and 

Consolidated 

Appropriations 

Act, 2021

American Rescue 

Plan Act

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ 20 $ 423 $ 36 $ 24 $ 106 $ 1,676 $ 2,555 $ 120

Total Intragovernmental Assets 20 423 36 24 106 1,676 2,555 120

Accounts Receivable, Net (Note 6) — — — — — 30 2 —

Inventory and Related Property, Net (Note 8) — — — — — — — —

Total Assets 20 423 36 24 106 1,706 2,557 120

Accounts Payable — — — — — 6 2 —

Benefits Due and Payable — — — — — — — —

Other Liabilities (Notes 17, 18 & 19) 2 — — — — 29 6 —

Total Liabilities 2 — — — — 35 8 —

Unexpended Appropriations 20 423 36 24 106 310 2,547 120

Cumulative Results of Operations (2) — — — — 1,361 2 —

Total Liabilities and Net Position 20 423 36 24 106 1,706 2,557 120

STATEMENT OF NET COST

Gross Program Costs 65 52 2 11 34 1,682 404 9

Net Cost of Operations (Notes 21 & 25) 65 52 2 11 34 1,682 404 9

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance 83 475 38 35 140 2,382 3,353 4,658

Appropriations Received — — — — — — — (3,600)

Appropriations Transferred in/out — — — — — — — —

Other Adjustments — — — — — (600) (400) (929)

Appropriations Used (63) (52) (2) (11) (34) (1,472) (406) (9)

Net Change in Unexpended Appropriations (63) (52) (2) (11) (34) (2,072) (806) (4,538)

Total Unexpended Appropriations 20 423 36 24 106 310 2,547 120

Cumulative Results of Operations:

Beginning Balance — — — — — 1,571 — —

Appropriations Used 63 52 2 11 34 1,472 406 9

Net Cost of Operations (65) (52) (2) (11) (34) (1,682) (404) (9)

Net Change in Cumulative Results of Operations (2) — — — — (210) 2 —

Total Cumulative Results of Operations (2) — — — — 1,361 2 —

Net Position $ 18 $ 423 $ 36 $ 24 $ 106 $ 1,671 $ 2,549 $ 120
142 Section II | Financial Information

FY 2022

Account Name Office of the 

Secretary

Treasury Account Symbol 12X0408

Purpose American Rescue 

Plan Act Total

BALANCE SHEET

Intragovernmental:

Fund Balance with Treasury (Note 3) $ 2,575 $ 13,630

Total Intragovernmental Assets 2,575 13,630

Accounts Receivable, Net (Note 6) — 32

Inventory and Related Property, Net (Note 8) — 8

Total Assets 2,575 13,670

Accounts Payable — 9

Benefits Due and Payable — 677

Other Liabilities (Notes 17, 18 & 19) 108 204

Total Liabilities 108 890

Unexpended Appropriations 2,467 11,411

Cumulative Results of Operations — 1,369

Total Liabilities and Net Position 2,575 13,670

STATEMENT OF NET COST

Gross Program Costs 133 27,190

Net Cost of Operations (Notes 21 & 25) 133 27,190

STATEMENT OF CHANGES IN NET POSITION

Unexpended Appropriations:

Beginning Balance — 14,076

Appropriations Received 3,600 29,550

Appropriations Transferred in/out — (352)

Other Adjustments (1,000) (4,889)

Appropriations Used (133) (26,974)

Net Change in Unexpended Appropriations 2,467 (2,665)

Total Unexpended Appropriations 2,467 11,411

Cumulative Results of Operations:

Beginning Balance — 1,585

Appropriations Used 133 26,974

Net Cost of Operations (133) (27,190)

Net Change in Cumulative Results of Operations — (216)

Total Cumulative Results of Operations — 1,369

Net Position $ 2,467 $ 12,780
USDA | 2022 Agency Financial Report 143

RMA took numerous actions to provide relief in the face of the pandemic to ensure crop insurance 

continued to provide a farm safety net under such unprecedented times. RMA did not initially receive 

direct budgetary resources to respond to COVID-19 and most of the actions provided reporting 

flexibilities to AIP’s and producers.

Beginning FY 2021, RMA was assigned to administer the Pandemic Cover Crop Program as part of 

USDA’s Pandemic Assistance for Producers initiative, a bundle of programs to bring financial 

assistance to farmers, ranchers and producers who felt the impact of COVID-19 market disruptions.

NOTE 28: Subsequent Events

Management is not aware of any events or transactions that have occurred subsequent to the balance 

sheet date, but prior to the issuance of the financial statements, that have a material effect on the 

financial statements and therefore require adjustment or disclosure in the statements.

Note Disclosure Related to the Statement of Net Cost and 

Statement of Changes in Net Position

NOTE 29: Reclassification of Financial Statement Line 

Items for Financial Report Compilation Process 

To prepare the Financial Report (FR) of the U.S. Government, the Department of the Treasury requires 

agencies to submit an adjusted trial balance, which is a listing of amounts by U.S. Standard General 

Ledger account that appear in the financial statements. Treasury uses the trial balance information 

reported in the Governmentwide Treasury Account Symbol Adjusted Trial Balance System (GTAS) to 

develop a Reclassified Statement of Net Cost, and a Reclassified Statement of Changes in Net Position 

for each agency, which are accessed using GTAS.

Treasury eliminates all intragovernmental balances from the reclassified statements and aggregates 

lines with the same title to develop the FR statements. This note shows the USDA’s financial 

statements and the USDA’s reclassified statements prior to elimination of intragovernmental balances 

and prior to aggregation of repeated FR line items.

A copy of the 2022 FR can be found on the Treasury’s Reports, Statements and Publications website 

and a copy of the 2023 FR will be posted to this site as soon as it is released.

The term “intragovernmental” is used in this note to refer to amounts that results from other 

components of the Federal Government.

The term “non-Federal” is used in this note to refer to Federal Government amounts that result from 

transactions with non-Federal entities. These include transactions with individuals, businesses, 

nonprofit entities, and State, local, and foreign Governments.
144 Section II | Financial Information

Reclassification of Statement of Net Cost to Line Items Used for the Government-wide Statement of Net Cost for the Year Ending September 30, 2023

FY 2023 USDA SNC Line Items Used to Prepare FY 2023 Government-wide SNC 

Financial Statement Line Amounts Amounts Reclassified Financial Statement Line

Gross Costs Gross cost

$ 233,103 Non-federal gross cost

Federal gross cost

2,319 Benefit program costs (RC 26)/2

1,317 Imputed costs (RC25)/2

1,859 Buy/Sell Cost (RC24)/2

1 Purchase of assets (RC 24)/2

4,672 Borrowing and other interest expense (RC05)/2

608 Other expenses (without reciprocals) (RC 29)

(1) Reconciling Item - Purchase of assets

10,775 Total federal gross cost

Total Gross Costs $ 243,878 243,878 Department total gross cost

Earned Revenue Earned revenue

11,675 Non-federal earned revenue

(2) Reconciling Item - Custodial revenue - Non-federal earned revenue

11,673 Adjusted Non-federal earned revenue

Federal earned revenue

538 Buy/sell revenue (exchange) (RC24)/2

1 Purchase of assets offset (RC 24) / 2

11 Federal securities interest revenue including associated gains and losses (exchange) (RC 03)/2

590 Borrowing and other interest revenue (exchange) (RC 05)/2

101 Collections transferred in to a TAS other than the general fund of the U.S. Government - exchange (RC 13)

(1) Reconciling item - Purchase of assets

(3) Reconciling Item - Custodial revenue - Buy/sell revenue (exchange) (RC24)/2

1,237 Total federal earned revenue

Less: Total Earned Revenue 12,910 12,910 Department total earned revenue

Net Cost of Operations $ 230,968 $ 230,968 Net cost of operations
USDA | 2023 Agency Financial Report 145

Reclassification of Statement of Changes in Net Position to Line Items Used for Government-wide Statement of Operations and Changes in Net Position for 

the Year Ending September 30, 2023

FY 2023 USDA SCNP Line Items Used to Prepare FY 2023 Government-wide SCNP

Financial Statement Line Amounts Amounts Reclassified Financial Statement Lines

Unexpended Appropriations:

Beginning Balances $ 169,264 $ 169,264 Net position, beginning of period

Appropriations Received 269,217 269,217 Appropriations received as adjusted (rescissions and other adjustments) (RC 41)/1

307 Non-expenditure transfers-in of unexpended appropriations and financing sources (RC 08) /1

Appropriations Transferred In (Out) 164 143 Non-expenditure transfers-out of unexpended appropriations and financing sources (RC 08) /1

Other Adjustments (8,177) (8,177) Appropriations received as adjusted (rescissions and other adjustments) (RC 41)/1

Appropriations Used (211,810) 211,810 Appropriations used (RC 39)

Net Change in Unexpended Appropriations 49,394 49,394 Net change in unexpended appropriations

Total Unexpended Appropriations 218,658 218,658 Total unexpended appropriations

Cumulative Results of Operations:

Beginning Balances 53,731 53,731 Net position, beginning of period

702 Collections for others transferred to the General Fund of the U.S. Government (RC 44)

Other Adjustments (691) 11 Reconciling - Custodial activity - collections for others transferred to the General Fund of the U.S. Government (RC 44)

Appropriations Used 211,810 211,810 Appropriations expended (RC 38)/1

35 Other taxes and receipts

Non-exchange Revenue 25,802 25,767 Collections transferred into a TAS other than the General Fund of the U.S. Government - Nonexchange (RC 15)

Donations and Forfeitures of Cash and Cash Equivalents 3 3 Other taxes and receipts

215 Appropriation of unavailable special or trust fund receipts transfers-in (RC 07)/1

12 Appropriation of unavailable special or trust fund receipts transfers-out (RC 07) /1

10 Non-expenditure transfers-in of unexpended appropriations and financing sources (RC 08)/1i

877 Non-expenditure transfers-out of unexpended appropriations and financing sources (RC 08)/1

12 Transfers-in without reimbursement (RC 18)/1

(3) Transfers-out without reimbursement (RC 18)/1

Transfers In (Out) Without Reimbursement (650) (1) Reconciling item - rounding

Imputed Financing 1,317 1,317 Imputed financing sources (RC 25)/1

85 Other taxes and receipts

459 Reconciling item - custodial activity - other taxes and receipts

286 Collections transferred into a TAS Other Than the General Fund of the U.S. Government - Nonexchange (RC 15)

3,202 Non-entity collections transferred to the General Fund of the U.S. Government (RC 44)

295 Reconciling item - Custodial revenue - Non-entity collections transferred to the General Fund of the U.S. Government (RC 44)

1,251 Accrual for non-entity amounts to be collected and transferred to the General Fund of the U.S. Government (RC48)

157

Reconciling item - Custodial activity - accrual for non-entity amounts to be collected and transferred to the General Fund 

of the U.S. Government (RC 48)

Other (4,088) 1 Reconciling item - rounding

Net Cost of Operations (230,968) 230,968 Net cost of operations

Net Change and Cumulative Results of Operations 2,535 2,535 Net change and cumulative results of operations

Total Cumulative Results of Operations 56,266 56,266 Total Cumulative results of operations

Net Position $ 274,924 $ 274,924 Net position, end of period
146 Section II | Financial Information

Required Supplementary Information

Deferred Maintenance and Repairs (Unaudited)

The Forest Service is steward to nearly 193 million acres of national forests and grasslands within the 

NFS. On these NFS lands, the agency manages major assets that are categorized as PP&E, including 

nearly 40,000 administrative, recreation, and research buildings, over 1,100 communication systems, 

and approximately 30,000 recreational sites, such as campgrounds, picnic areas, trailheads, and 

interpretive sites.

Across the NFS, the agency also manages over 370,000 miles of roads, of which 65,000 miles are for 

passenger vehicles; over 159,000 miles of trails for motorized and non-motorized use; nearly 13,400 road 

and trail bridges; and over 1,700 Forest Service owned and Special Use Permitted dam structures.

ARS owns/manages approximately 15 million gross square feet of facility space in 2,973 buildings on 

405,783 acres of land. APHIS operates approximately 28 facilities, which includes 378 buildings, in the 

United States and 14 facilities/buildings internationally. The NRCS portfolio of owned assets 

encompasses 27 sites, including 12 parcels of owned land, 218 buildings, and about 215 other structures.

Deferred Maintenance & Repairs (DM&R) estimates include capitalized PP&E, non-capitalized 

heritage assets, and non-capitalized or fully depreciated PP&E. 

No DM&R is reported for stewardship land because land is considered to be in acceptable condition 

unless an environmental contamination or liability is identified and the land cannot be used for its 

intended purpose. Stewardship land easements are excluded from DM&R since ownership is retained 

by the landowner.

Defining and Implementing Maintenance and Repairs Policies in Practice 

Policies for ranking and prioritizing DM&R activities for most assets, except roads, trails, and bridges, 

are based on condition surveys performed on a 5-year revolving schedule. Roads, trails and bridges 

have separate schedules. The agency’s DM&R for NFS passenger car roads is determined every year 

from random sample surveys providing a moderate level of confidence that the DM&R total being 

reported represents the true DM&R. DM&R is not reported for roads that are not part of the passenger 

car system because maintenance needs on those roads are not as recurring and cyclical year over year. 

Bridge inspections occur on a 2-year or 4-year revolving schedule. To date, scheduled surveys of all 

administrative buildings, dams, bridges, roads open to passenger cars, and recreation sites have 

been accomplished.

ARS, APHIS, and NRCS use similar condition surveys to estimate DM&R on all major classes of its 

PP&E and heritage assets.
USDA | 2023 Agency Financial Report 147

Ranking and Prioritizing Maintenance and Repairs Activities

Maintenance and repair activities are prioritized based on condition surveys and ranked based on 

PP&E and heritage assets that pose serious threats to public health or safety, a natural resource, or the 

ability of the agency to implement its mission. 

Factors Considered in Setting Acceptable Condition

The standards for acceptable operating condition for various classes of PP&E and heritage assets are 

as follows:

Conditions of roads and bridges within the NFS road system are measured by various standards: 

• Federal Highway Administration regulations for the Federal Highway Safety Act. 

• Best management practices for the nonpoint source provisions of the Clean Water Act from U.S. 

Environmental Protection Agency and States.

• Road management objectives developed through the National Forest Management Act forest 

planning process.

• Forest Service directives—Forest Service Manual (FSM) 7730, Operation and Maintenance; 

Forest Service Handbook (FSH) 7709.56a, Road Preconstruction, and FSH 7709.56b, 

Transportation Structures Handbook.

Dams in the NFS are managed according to FSM 7500, Water Storage and Transmission, and FSH 

7509.11, Dams Management Handbook. The condition of a dam is acceptable when the dam meets 

current design standards and does not have any deficiencies that threaten the safety of the structure or 

public. For dams to be rated in acceptable condition, the agency needs to restore the dams to the 

original functional purpose, correct unsightly conditions, or prevent more costly repairs.

Buildings in the NFS comply with the International Family of Building and Related Codes, the 

National Fire Protection Association Life Safety Code, the Forest Service Health and Safety 

Handbook, and the Occupational Safety Health Administration as determined by condition surveys and 

safety inspections. These requirements are found in FSM 7310, Buildings and Related Facilities. 

Recreation facilities in the NFS are located within recreation sites that range from highly developed 

sites to general forest areas such as campgrounds, trailheads, trails, water and wastewater systems, 

interpretive facilities, and visitor centers. Recreation sites are managed in accordance with Federal 

laws and regulations (Code of Federal Regulations [CFR] 36). 

Detailed management guidelines are contained in FSM 2330, Publicly Managed Recreation 

Opportunities, and forest- and regional-level user guides. Quality standards for developed recreation 

sites in the NFS were established as Meaningful Measures for health and cleanliness, settings, safety 

and security, responsiveness, and the condition of the facility. 
148 Section II | Financial Information

Trails and trail bridges in the NFS are managed according to Federal law and regulations (CFR 36). 

More specific direction is contained in FSM 2350, Trail, River, and Similar Recreation Opportunities, 

and the FSH 2309.18, Trails Management Handbook.

ARS, APHIS, and NRCS define acceptable condition in accordance with standards comparable to 

those used in private industry for buildings and other structures.

Deferred Maintenance and Repair Costs

Asset Category FY 2023 Ending Balance FY 2023 Beginning Balance FY 2022 Ending Balance FY 2022 Beginning Balance

General PP&E $ 9,633 $ 8,295 $ 8,295 $ 6,782

Heritage Assets 463 290 290 252

Total $ 10,096 $ 8,585 $ 8,585 $ 7,034

DM&R costs increased in FY 2023 across all categories within PP&E mainly due to deteriorating 

assets, continued focus on data accuracy and thorough condition surveys, and the effects of inflation 

both not allowing funding for maintenance projects to reach as many assets and the cost to complete 

maintenance needs already on the backlog increasing.

Funding from the Great American Outdoors Act – Legacy Restoration Fund allowed the agency to 

address $23.7 million of the deferred maintenance over the last year by completing 85 projects. 

Through FY 2023, the Forest Service had 994 internally tracked projects funded by Congress.
USDA | 2023 Agency Financial Report 149

Combining Statement of Budgetary Resources (Unaudited)

FPAC 

Business 

Center FSA CCC RMA NRCS FNS FSIS AMS APHIS

FY 2023 

Item

Budgetary Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts Budgetary Budgetary Budgetary Budgetary Budgetary Budgetary

Budgetary Resources:

Unobligated Balance from Prior Year Budget Authority, 

Net (Discretionary and Mandatory) (Note 22) $ 34 $ 8,964 $ 191 $ 667 $ 131 $ 678 $ 11,977 $ 96,617 $ 181 $ 4,930 $ 1,584

Appropriations (Discretionary and Mandatory) 2,387 5,371 19 2,008 — 15,390 6,668 226,834 1,151 2,641 2,111

Borrowing Authority (Discretionary and Mandatory) — — 3,230 13,298 463 — — — — — —

Spending Authority from Offsetting Collections 

(Discretionary and Mandatory) 158 403 3,407 8 160 7,214 (6) 118 220 178 293

Total Budgetary Resources 2,579 14,738 6,847 15,981 754 23,282 18,639 323,569 1,552 7,749 3,988

Status of Budgetary Resources:

New Obligations and Upward Adjustments (Total) 2,385 7,369 3,901 15,475 464 22,681 9,769 199,932 1,463 5,681 2,415

Unobligated Balance, End of Year:

Apportioned, Unexpired Accounts 170 6,711 2,564 404 38 590 6,197 37,676 60 1,425 1,542

Exempt from Apportionment, Unexpired Accounts — — — — — — — — — 46 —

Unapportioned, Unexpired Accounts — 161 382 93 252 5 33 9,179 — 187 6

Unexpired Unobligated Balance, End of Year 170 6,872 2,946 497 290 595 6,230 46,855 60 1,658 1,548

Expired Unobligated Balance, End of Year 24 497 — 9 — 6 2,640 76,782 29 410 25

Unobligated Balance, End of Year (Total) 194 7,369 2,946 506 290 601 8,870 123,637 89 2,068 1,573

Total Budgetary Resources 2,579 14,738 6,847 15,981 754 23,282 18,639 323,569 1,552 7,749 3,988

Outlays, Net, and Disbursements, Net:

Outlays, Net (Total) (Discretionary and Mandatory) 305 4,617 9,152 16,576 4,694 171,456 1,209 2,994 1,849

Distributed Offsetting Receipts (-) 1 (705) (68) — (2) (2) (16) (206) (8)

Agency Outlays, Net (Discretionary and Mandatory) $ 306 $ 3,912 $ 9,084 $ 16,576 $ 4,692 $ 171,454 $ 1,193 $ 2,788 $ 1,841

Disbursements, Net (Total) (Mandatory) $ 325 $ 44
150 Section II | Financial Information

FS RD ARS NASS NIFA ERS FAS Staff Offices Total

FY 2023 

Item

Budgetary Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts Budgetary Budgetary Budgetary Budgetary Budgetary Budgetary Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts

Budgetary Resources:

Unobligated Balance from Prior Year Budget Authority, 

Net (Discretionary and Mandatory) (Note 22) $ 12,153 $ 17,954 $ 4,458 $ 509 $ 18 $ 1,101 $ 12 $ 217 $ 5,183 $ 162,779 $ 4,780

Appropriations (Discretionary and Mandatory) 11,579 7,171 — 1,902 213 2,043 94 487 (797) 287,253 19

Borrowing Authority (Discretionary and Mandatory) — — 12,689 — — — — — — 13,298 16,382

Spending Authority from Offsetting Collections 

(Discretionary and Mandatory) 648 681 8,286 180 37 97 6 55 1,626 11,916 11,853

Total Budgetary Resources 24,380 25,806 25,433 2,591 268 3,241 112 759 6,012 475,246 33,034

Status of Budgetary Resources:

New Obligations and Upward Adjustments (Total) 12,800 9,681 17,712 2,237 262 2,685 103 516 2,386 297,840 22,077

Unobligated Balance, End of Year:

Apportioned, Unexpired Accounts 8,633 16,013 7,521 321 6 530 2 151 651 81,082 10,123

Exempt from Apportionment, Unexpired Accounts — — — — — — — — — 46 —

Unapportioned, Unexpired Accounts 2,840 23 200 4 — 1 — 6 2,918 15,456 834

Unexpired Unobligated Balance, End of Year 11,473 16,036 7,721 325 6 531 2 157 3,569 96,584 10,957

Expired Unobligated Balance, End of Year 107 89 — 29 — 25 7 86 57 80,822 —

Unobligated Balance, End of Year (Total) 11,580 16,125 7,721 354 6 556 9 243 3,626 177,406 10,957

Total Budgetary Resources 24,380 25,806 25,433 2,591 268 3,241 112 759 6,012 475,246 33,034

Outlays, Net, and Disbursements, Net:

Outlays, Net (Total) (Discretionary and Mandatory) 8,969 5,689 1,775 196 1,799 105 454 607 232,446

Distributed Offsetting Receipts (-) (903) (1,592) (18) — (33) — — (7) (3,559)

Agency Outlays, Net (Discretionary and Mandatory) $ 8,066 $ 4,097 $ 1,757 $ 196 $ 1,766 $ 105 $ 454 $ 600 $ 228,887

Disbursements, Net (Total) (Mandatory) $ 5,259 $ 5,628
USDA | 2023 Agency Financial Report 151

FPAC 

Business 

Center FSA CCC RMA NRCS FNS FSIS AMS APHIS

FY 2022

Item

Budgetary Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts Budgetary Budgetary Budgetary Budgetary Budgetary Budgetary

Budgetary Resources:

Unobligated Balance from Prior Year Budget Authority, 

Net (Discretionary and Mandatory) (Note 22) $ 20 $ 7,100 $ 151 $ 1,085 $ 108 $ 613 $ 6,737 $ 77,803 $ 234 $ 3,679 $ 1,458

Appropriations (Discretionary and Mandatory) 300 12,808 — 2,319 — 12,527 10,349 205,653 1,139 4,619 2,384

Borrowing Authority (Discretionary and Mandatory) — — 3,560 11,978 425 — — — — — —

Spending Authority from Offsetting Collections 

(Discretionary and Mandatory) 12 306 2,482 9 147 6,305 56 94 231 207 249

Total Budgetary Resources 332 20,214 6,193 15,391 680 19,445 17,142 283,550 1,604 8,505 4,091

Status of Budgetary Resources:

New Obligations and Upward Adjustments (Total) 304 10,916 3,894 14,961 458 18,768 5,798 191,701 1,435 3,971 2,348

Unobligated Balance, End of Year:

Apportioned, Unexpired Accounts 12 5,647 2,271 327 29 666 7,412 30,370 147 2,480 1,716

Exempt from Apportionment, Unexpired Accounts — — — — — — — — — 276 —

Unapportioned, Unexpired Accounts — 3,429 28 101 193 5 1,311 9,429 — 1,571 9

Unexpired Unobligated Balance, End of Year 12 9,076 2,299 428 222 671 8,723 39,799 147 4,327 1,725

Expired Unobligated Balance, End of Year 16 222 — 2 — 6 2,621 52,050 22 207 18

Unobligated Balance, End of Year (Total) 28 9,298 2,299 430 222 677 11,344 91,849 169 4,534 1,743

Total Budgetary Resources 332 20,214 6,193 15,391 680 19,445 17,142 283,550 1,604 8,505 4,091

Outlays, Net, and Disbursements, Net:

Outlays, Net (Total) (Discretionary and Mandatory) 307 10,412 8,927 10,918 4,287 192,291 1,147 2,722 1,886

Distributed Offsetting Receipts (-) — (686) (52) — (1) (1) (18) (196) (12)

Agency Outlays, Net (Discretionary and Mandatory) $ 307 $ 9,726 $ 8,875 $ 10,918 $ 4,286 $ 192,290 $ 1,129 $ 2,526 $ 1,874

Disbursements, Net (Total) (Mandatory) $ 1,230 $ 79
152 Section II | Financial Information

FS RD ARS NASS NIFA ERS FAS Staff Offices Total

FY 2022

Item

Budgetary Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts Budgetary Budgetary Budgetary Budgetary Budgetary Budgetary Budgetary

NonBudgetary 

Credit Reform 

Financing 

Accounts

Budgetary Resources:

Unobligated Balance from Prior Year Budget Authority, 

Net (Discretionary and Mandatory) (Note 22) $ 4,344 $ 4,634 $ 4,590 $ 436 $ 26 $ 676 $ 13 $ 221 $ 6,552 $ 115,631 $ 4,849

Appropriations (Discretionary and Mandatory) 17,117 20,605 3 1,797 190 2,350 88 467 (756) 293,956 3

Borrowing Authority (Discretionary and Mandatory) — — 13,065 — — — — — — 11,978 17,050

Spending Authority from Offsetting Collections 

(Discretionary and Mandatory) 557 748 8,355 173 26 82 2 63 1,545 10,665 10,984

Total Budgetary Resources 22,018 25,987 26,013 2,406 242 3,108 103 751 7,341 432,230 32,886

Status of Budgetary Resources:

New Obligations and Upward Adjustments (Total) 10,208 8,681 17,705 2,168 242 2,048 94 547 2,268 276,458 22,057

Unobligated Balance, End of Year: — — — — — — — — — — —

Apportioned, Unexpired Accounts 5,176 5,034 8,003 209 — 1,037 1 93 599 60,926 10,303

Exempt from Apportionment, Unexpired Accounts — — — — — — — — — 276 —

Unapportioned, Unexpired Accounts 6,556 12,190 305 2 — 5 — 11 4,422 39,041 526

Unexpired Unobligated Balance, End of Year 11,732 17,224 8,308 211 — 1,042 1 104 5,021 100,243 10,829

Expired Unobligated Balance, End of Year 78 82 — 27 — 18 8 100 52 55,529 —

Unobligated Balance, End of Year (Total) 11,810 17,306 8,308 238 — 1,060 9 204 5,073 155,772 10,829

Total Budgetary Resources 22,018 25,987 26,013 2,406 242 3,108 103 751 7,341 432,230 32,886

Outlays, Net, and Disbursements, Net:

Outlays, Net (Total) (Discretionary and Mandatory) 8,485 5,383 1,611 196 1,595 87 403 374 251,031

Distributed Offsetting Receipts (-) (818) (3,976) (18) — (3) 1 — (16) (5,796)

Agency Outlays, Net (Discretionary and Mandatory) $ 7,667 $ 1,407 $ 1,593 $ 196 $ 1,592 $ 88 $ 403 $ 358 $ 245,235

Disbursements, Net (Total) (Mandatory) $ 5,590 $ 6,899
USDA | 2023 Agency Financial Report 153

Land (Unaudited)

Forest Service

The Forest Service is steward to over a 193 million acres of PP&E lands, Stewardship lands and 

permanent land rights encompassing national forests and grasslands which provides a wide range of 

economic, social, and environmental benefits. The mission of the Forest Service is to sustain the 

health, diversity, and productivity of the nation’s forests and grasslands to meet the needs of present 

and future generations. The Forest Service achieves this mission through active land management 

practices supported by science and focused on conservation, preservation, multiple use, and 

sustained yield. 

Forest Service PP&E lands are predominantly acquired for the construction and or use of buildings to 

support Forest Service goals which include but is not limited to protection of water quality, habitat for 

wildlife and fisheries, forest health, recreation, and forest products.

Forest Service Stewardship lands are predominantly used to achieve land management goals which 

include but is not limited to protection of water quality, habitat for wildlife and fisheries, forest health, 

recreation, and forest products.

Land and land rights acquired by the Forest Service are predominantly permanent in nature and include 

surface and or sub-surface rights as fee title or partial interest. Forest Service does not report or track 

yearly amounts to administer land rights.

Forest Service lands and permanent land rights are assigned to one of three sub-categories based on 

predominant use and are reported in estimated acres of land. The three sub-categories are commercial 

use land; conservation and preservation land; and operational land.

Commercial use land or land rights are predominantly used to generate inflows of resources from 

non-Federal third parties. Forest Service has broad authority to issue various special use authorization 

types and collect fees for the use of NFS land. These authorized uses do not represent the predominate 

use of NFS lands and they are infrequent in location and temporary in nature.

Conservation and preservation land or land rights are used for protection and proper use of natural 

resources or preservation of buildings, objects, and landscapes from use. Examples of land conserved 

or preserved for significant natural, historic, scenic, cultural, and recreational resources include 

geologic resource sites, wildlife and plant life refuges, archeological resource sites or local Native 

American or ethnic cultural sites. 

Operational land and land rights are used predominately for general or administrative purposes 

including scientific functions such as conducting and managing research, experimentation, and 

operations; and other related functions that are administrative or other mission related in nature 

including office building locations. 
154 Section II | Financial Information

Agricultural Research Service

ARS has 390,703 acres of land including 77,504 acres of federally owned land and 313,199 acres of 

Public Domain land used for research, finding scientific solutions to national and global agricultural 

challenges. ARS is holding 70 acres of land for disposal at Glenn Dale, MD. 

Animal and Plant Health Inspection Service

APHIS owns approximately 1,162 acres of land used primarily for research and development facilities 

in support of our mission to protect American Agriculture. The largest acreage is the land at Moore Air 

base used to house the Insect Management and Molecular Diagnostics Laboratory. The laboratory is 

responsible for developing and validating technologies used to detect and diagnose plant pests.

Natural Resources Conservation Service

NRCS owns land on twelve Plant Materials Center (PMC) locations. Of the twelve, eleven are owned 

by NRCS, and one is operated under a contribution agreement. PMC land is used for seed and plant 

production, for plant studies, for demonstration areas, and for buildings and facilities to support PMC 

activities. PMC land not usable for these purposes may be managed as natural areas to provide buffers 

between PMC operations and other areas. PMCs manage land resources consistent with NRCS 

conservation practices to maintain soil, water, and other natural resources, and ensure the land is 

acceptable for future PMC activities.

NRCS has one small parcel of land (0.2 acres), obtained from another Federal agency in 1955, that 

houses a storage unit used for field office supplies. The parcel, located in a residential/mixed use area, 

is maintained in accordance with local requirements.

Stewardship land consists of conservation easements acquired under a variety of easement programs 

and authorities. NRCS’s mission objectives in administering the conservation easement programs are 

to provide landowners with financial and technical assistance in return for maintaining and improving 

high quality productive soils, clean and abundant water, healthy plant and animal communities, clean 

air, an adequate energy supply, and working farm and ranch land.

USDA stewardship land easement acreage accurately reflects the number of acres under USDA 

stewardship land easement as of September 30, 2023. However, for the reasons discussed in this 

section, this number may be adjusted in future reports.

Early stewardship land conservation easements were acquired without the benefit of being 

professionally surveyed. Although the best technology at the time was utilized to determine easement 

size, there is variation to the accuracy of those methods compared to present day surveying techniques. 

Presently, all USDA stewardship land conservation easements are surveyed by licensed surveyors to 

determine the size of the easement. While these surveys provide an accurate report of the size of the 

easement, USDA is continually making efforts to enhance its survey standards and requirements to 

reflect survey equipment improvements and ensure accurate reporting. Annual monitoring of 
USDA | 2023 Agency Financial Report 155

stewardship land conservation easements allows NRCS to observe situations that may lead to the need 

for an updated survey. For example, lack of signage on an easement boundary or other circumstances 

that result in undefined easement boundaries often precipitate encroachment by adjacent landowners 

and violations of the terms of the easement. In order to reduce the frequency of these encroachments 

and easement violations, USDA stewardship land easements occasionally require new surveys to 

reestablish the easement boundaries. Because these boundary reestablishment surveys are conducted 

under the most current survey standards and requirements, the new survey may reflect a change in the 

acres as originally reported for that particular easement which may result in adjustment in the reporting 

of USDA stewardship land easement acreage.

In addition, the 2014 Farm Bill granted authority to NRCS to amend USDA stewardship land 

easements through an easement administration action. If approved, the resulting amendment may result 

in an increase in the reported USDA stewardship land easement acreage, or, in the case of an 

authorized easement termination, a reduction in the easement and acre count. Finally, though rare, 

litigation involving existing USDA stewardship land easements may result in the termination of an 

easement or a modification to the boundary of an easement, both of which would result in an 

adjustment to the reported USDA stewardship land easement acreage.

Of the Stewardship Land, 3.2 million acres are of a permanent duration. The remaining approximately 

476 thousand acres are considered temporary, ranging from 30 to 99 years in duration. There are no 

costs associated with the maintenance of these land rights.
156 Section II | Financial Information

FY2023

PP&E Land Estimated Acreage by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service 358 9,613 — 9,971

Agricultural Research Service — 77,504 — 77,504

Animal and Plant Health Inspection Service — 1,162 — 1,162

Natural Resources Conservation Service — 1,900 — 1,900

Total General PP&E 358 90,179 — 90,537

PP&E Land Held for Disposal or Exchange by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service — 54 — 54

Agricultural Research Service — 70 — 70

Total General PP&E — 124 — 124

Stewardship Land Estimated Acreage by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service 191,552,875 1,165,796 401,256 193,119,927

Agricultural Research Service — 313,199 — 313,199

Natural Resources Conservation Service 3,689,002 — — 3,689,002

Total Stewardship Land 195,241,877 1,478,995 401,256 197,122,128

Stewardship Land Held for Disposal or Exchange by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service — 522 — 522

Total Stewardship Land — 522 — 522
USDA | 2023 Agency Financial Report 157

FY2022

PP&E Land

Estimated Acreage by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service 349 9,207 — 9,556

Agricultural Research Service — 77,655 — 77,655

Animal and Plant Health Inspection Service — 1,146 — 1,146

Natural Resources Conservation Service — 1,900 — 1,900

Total PP&E 349 89,908 — 90,257

PP&E Land Held for Disposal or Exchange by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service — 54 — 54

Agricultural Research Service — 70 — 70

Total PP&E — 124 — 124

Stewardship Land

Estimated Acreage by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service 191,491,750 1,186,627 404,971 193,083,348

Agricultural Research Service — 313,198 — 313,198

Natural Resources Conservation Service 3,649,692 — — 3,649,692

Total Stewardship Land 195,141,442 1,499,825 404,971 197,046,238

Stewardship Land Held for Disposal or Exchange by Predominant Use

Conservation and Preservation Operational Commercial Use Total Estimated Acreage

Agency

Forest Service — 522 — 522

Total Stewardship Land — 522 — 522
158 Section II | Financial Information
USDA | 2023 Agency Financial Report 159

Section III

Other Information
160 Section III | Other Information

Summary of Financial Statement Audit 

and Management Assurances

Summary of Existing Material Weaknesses

USDA’s material weakness as related to management’s assurance for the FMFIA and the certification 

for FFMIA, are listed in Exhibit 15 and Exhibit 16. 

Exhibit 15: Summary of Financial Statement Audit 

Audit Opinion as of November 14, 2023: Modified 2023 Consolidated Financial Statement Audit

Restatement: No

Material Weakness

Beginning 

Balance New Resolved Consolidated

Ending 

Balance

Financial Management 1 1 1 1

Information Technology Security 

and Controls 1 2 2 1

TOTAL MATERIAL WEAKNESSES 2 3 3 2

Exhibit 16: Summary of Management Assurances

A. Effectiveness of Internal Control Over Reporting (FMFIA § 2)1

Statement of Assurance: Modified

Material Weakness

Beginning 

Balance New Resolved Consolidated Reassessed

Ending 

Balance

Financial Management 1 1 1 1

TOTAL MATERIAL 

WEAKNESSES 1 1 1 1

1

In the FY 2022 Agency Financial Report, the Information Technology material weakness was reported in Exhibit 22.A Effectiveness of 

Internal Control Over Reporting (FMFIA § 2). The correct reporting is Effectiveness of Internal Control Over Operations (FMFIA § 2), 

which is correct for FY 2023.
USDA | 2023 Agency Financial Report 161

B. Effectiveness of Internal Control Over Operations (FMFIA § 2)

Statement of Assurance: Modified

Material Weakness

Beginning 

Balance New Resolved Consolidated Reassessed

Ending 

Balance

Information Technology 1 2 2 1

TOTAL MATERIAL 

WEAKNESSES 1 2 2 1

C. Conformance with Federal Financial Management System Requirements (FMFIA § 4)

Statement of Assurance: Unmodified

Non-Conformances Beginning 

Balance New Resolved Consolidated Reassessed Ending Balance

Funds Control Management 1 1 0

TOTAL

NON-CONFORMANCES 1 1 0

D. Compliance with Section 803 (A) of the FFMIA

Item Agency Auditor

1

Federal Financial Management System 

Requirements

Lack of substantial 

compliance noted

Lack of substantial 

compliance noted

2 Applicable Federal Accounting Standards No lack of substantial 

compliance noted

No lack of substantial 

compliance noted

3

U.S. Standard General Ledger at Transaction 

Level

Lack of substantial 

compliance noted

Lack of substantial 

compliance noted
162 Section III | Other Information

Management Challenges 

The Reports Consolidation Act of 2000 requires the USDA OIG to report annually on the most serious 

management challenges USDA and its agencies and mission offices face. OIG sought to provide the 

Secretary and other policymakers with a streamlined report that improves clarity and highlights 

significant information. 

OIG reported FY 2023 challenges is a lookback into the period of FY 2020 to FY 2023 that aims to 

provide the Department areas where USDA could improve its efforts to achieve overall excellence for 

the Department. As a part of the FY 2023 management challenges review, one challenge have been 

removed from this year’s report. OIG also highlighted what they consider “key challenge area 

indicators” within the three areas to assist USDA when addressing the challenges.

a. Ensuring Safety and Security,

b. Providing Benefits, and

c. Delivering Efficient Programs 

An example of USDA’s success in program process improvements is USDA’s FSIS takes steps to ensure 

meat, poultry, and egg products are safe, wholesome, and properly labeled. FSIS personnel at more than 

6,600 regulated establishments ensure food safety through the authorities of the Federal Meat Inspection 

Act, the Poultry Products Inspection Act, the Poultry Products Inspection Act, and the Egg Products 

Inspection Act, as well as humane animal handling through the Humane Methods of Slaughter Act. FSIS 

works with Federal, State, and local food safety partners to address emerging pathogens, detect 

foodborne hazards, and prevent foodborne illness. In calendar year 2022, FSIS issued 68 total recalls (46 

percent product contamination, 26 percent misbranding, 22 percent unreported allergies) and 23 public 

health alerts. For FY 2023, the proposed budget for FSIS was $1.4 billion, with proposed discretionary 

funding of $1.2 billion, an increase of $150.4 million from the 2022 Annualized Continuing Resolution. 

During this time, USDA has made progress in improving its oversight of food safety. All the food safetyrelated recommendations OIG made between June 2020-2023 have been closed. 

The following pages include the entire USDA Management Challenges Report for FY 2023.

A full copy of the OIG Report is also available on the Oversight.gov website.
USDA |2023 Agency Financial Report 163

OFFICE OF INSPECTOR GENERAL

U. S. DEPARTMENT OF AGRICULTURE

2023 USDA Management Challenges

September 2023
164	 Section III | Other Information

UNITED STATES DEPARTMENT OF AGRICULTURE

OFFICE OF INSPECTOR GENERAL

Washington D.C. 20250 

DATE: September 12, 2023

TO: Honorable T

Secretary

FROM: Phyllis K. Fo

Inspector Ge

SUBJECT: 2023 USDA 

homas J. Vilsack

ng

neral

Management Challenges

In accordance with the Reports Consolidation Act of 2000, the U.S. 

Department of Agriculture (USDA) Office of Inspector General is issuing the 

2023 USDA Management Challenges report. This annual publication summarizes 

what we consider the most significant management and performance challenges 

facing the Department. The report is organized into three major challenge areas—

Ensuring Safety and Security, Providing Benefits, and Delivering Efficient Programs. 

It is intended to aid the Department with improving program performance and 

operations.

We would like to close by expressing our appreciation to you and the Deputy 

Secretary for your ongoing support of our work and your commitment to excellence 

at USDA. We look forward to working with the Department to address these 

management challenges.

If you have any questions or would like to discuss these management challenges 

and related key challenge indicators, please contact me (202-720-8001). You or your 

staff may also contact Analytics and Innovation’s Acting Assistant Inspector General, 

Craig Goscha (816-926-7644). 

Attachment 

cc: 

Subcabinet Officials 

Agency Administrator
USDA |2023 Agency Financial Report 165

Table of Contents

Introduction and Approach...................................1

Challenge 1: Ensuring Safety and Security .........2

Food Safety......................................................2

Animal and Plant Health ..................................5

Cybersecurity and Information Technology ......8

Challenge 2: Providing Benefits ........................10

Food and Nutrition Assistance Programs.......10

Grants Oversight ............................................14

Outreach ........................................................17

Challenge 3: Delivering Efficient Programs .......19

Financial Reporting ........................................19

Data Integrity..................................................22

Acronyms and Abbreviations.............................24

Courtesy Photo/AdobeStock. All AdobeStock 

photos included in the report are used under 

license. They do not depict any OIG audits or 

investigations.
166	 Section III | Other Information

1

Introduction and Approach

The Office of Inspector General (OIG) 

provides oversight to U.S. Department 

of Agriculture (USDA) programs and 

operations to help ensure the effective 

delivery of USDA programs to the public 

and American agriculture. USDA is 

comprised of 29 agencies and offices with 

nearly 100,000 employees at more than 

4,500 locations across the country and 

abroad. These agencies and offices provide 

specific services to the American people 

regarding research, marketing and regulatory 

programs, farm and foreign agriculture, food 

safety, rural development, natural resources, 

and other areas based on public policy, 

the best available science, and effective 

management. In accordance with the 

Reports Consolidation Act of 2000, we are 

reporting what we consider to be the most 

significant management and performance 

challenges facing the Department. 

Our report is organized into three major 

challenge areas—Ensuring Safety and 

Security, Providing Benefits, and Delivering 

Efficient Programs—which represent areas 

where OIG believes USDA could improve 

its efforts to achieve overall excellence 

for the Department. Each major challenge 

area contains “key challenge indicators” 

that can assist USDA when addressing 

the challenges.1 This approach should aid 

Departmental leadership by providing areas 

to address and resolve both broad and 

unique challenges that may affect multiple 

1 Key challenge indicators are areas of focus that are derived from our findings and can help the Department 

address the challenges more effectively.

and specific agencies. It also provides the 

Secretary and other policymakers with a 

more streamlined report to improve clarity 

and give significant information greater 

prominence. 

This report is primarily based on information 

gained from our audits, investigations, and 

other work in providing oversight of USDA’s 

programs and operations from June 1, 2020, 

through June 30, 2023.
USDA |2023 Agency Financial Report 167

2

Challenge 1: 

Ensuring Safety and Security

USDA is responsible for the overall program 

administration in many areas of food 

processing and food distribution. From 

inspecting domestic products, imports, and 

exports to conducting risk assessments and 

educating the public about the importance of 

food safety, USDA plays a role in ensuring 

public health and safety.

USDA services include safety- and securityrelated programs and initiatives, such as 

enhancing public health and well-being by 

protecting the public from foodborne illness 

and ensuring that the Nation’s meat, poultry, 

and egg products are safe, wholesome, 

and correctly packaged; ensuring the 

health and care of animals and plants; 

and supervising and coordinating the 

design, acquisition, maintenance, use, and 

disposal of information technology (IT) by 

USDA agencies.

The next section summarizes USDA’s 

management challenges, and its progress, 

in the areas of food safety, animal and plant 

welfare, and cybersecurity and IT. 

Food Safety

The Food Safety and Inspection Service 

(FSIS) is responsible for protecting the 

public’s health by ensuring that meat, poultry, 

and egg products are safe, wholesome, 

and properly labeled. Approximately 

9,000 FSIS employees at more than 

6,600 regulated establishments ensure food 

safety through the authorities of the Federal 

Meat Inspection Act, the Poultry Products 

Inspection Act, and the Egg Products 

Inspection Act, as well as humane animal 

handling through the Humane Methods of 

Slaughter Act. 

FSIS works with Federal, State, and local 

food safety partners to address emerging 

pathogens, detect foodborne hazards, 

and prevent foodborne illness. In calendar 

year 2022, FSIS issued 68 total recalls 

(46 percent product contamination, 

U.S. Department of Agriculture Shell 

Egg Graders perform sanitation preop inspections to ensure the shell egg 

processing machines are properly cleaned 

before starting the day’s operation. Photo 

by Preston Keres from USDA’s Flickr 

account. It does not depict any particular 

audit or investigation.
168	 Section III | Other Information

3

26 percent misbranding, 22 percent 

unreported allergies) and 23 public health 

alerts. For fiscal year (FY) 2023, the 

proposed budget for FSIS was $1.4 billion, 

with proposed discretionary funding of 

$1.2 billion, an increase of $150.4 million 

from the 2022 Annualized Continuing 

Resolution. 

During this time, USDA has made progress 

in improving its oversight of food safety. All 

the food safety-related recommendations 

we made between June 2020-2023 have 

been closed. However, Federal Oversight of 

Food Safety was added to the Government 

Accountability Office’s (GAO) high-risk 

list in 2007. In recent 

years, GAO has made 

recommendations to reduce 

fragmentation in Federal food 

safety oversight.

USDA’s challenge will be to remain vigilant 

and proactive in ensuring that American 

consumers receive wholesome foods. To 

maintain the confidence of consumers, 

Congress, and other stakeholders, USDA’s 

food safety agencies should continue to 

improve their inspection strategies and 

technology systems and provide consistent, 

documented applications of statutes and 

regulations. 

Example Report Summary 

To ensure labels are truthful and not 

misleading, FSIS’ Labeling and Program 

Delivery Staff review label applications and 

either approve product labels or request 

changes. FSIS also has inspection program 

personnel at each establishment who 

are responsible for verifying that labels 

and related files (i.e., labeling records) 

meet requirements. We reviewed label 

application packages for FY 2018 in our 

2020 report, Controls Over Meat, Poultry, 

and Egg Product Labels, to ensure that the 

labels FSIS approved were accurate and 

supported. While we found that FSIS’ 

controls over its approval of labels were 

generally effective, we also found that it 

needs to document its review and approval 

process for required labels and improve 

establishments’ compliance with generic 

label requirements. FSIS provided its 

response to our findings and agreed with 

our recommendations.

USDA OIG Highlighted Work Issued 

June 2020–2023: Food Safety

COVID-19—Food Safety and Inspection

Service Pandemic Response at 

Establishments (Report 24801-0001-23, 

issued 7/26/22)*

Controls Over Imported Meat and Poultry

Products (Report 24601-0003-21, issued 

7/1/20)*

FSIS Rulemaking Process for the 

Proposed Rule: Modernization of Swine

Slaughter Inspection (Report 24801-0001-

41, issued 6/23/20)* 

Controls Over Meat, Poultry, and Egg

Product Labels (Report 24601-0002-23, 

issued 6/15/20)*

Recommendation Progress**

OIG issued 4 audit products 

with 13 recommendations. All 

recommendations are closed.

* Indicates that all recommendations in the report are closed.

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.
USDA |2023 Agency Financial Report 169

4

USDA OIG Highlighted 

Investigations Closed 

June 2020-2023: Food Safety

OIG closed approximately 29 investigations 

related to food safety during this period, 

obtaining 15 administrative, 28 criminal, and 

19 civil outcomes,2

 and more than $11 million 

in monetary results. When OIG receives 

allegations involving food safety, we 

thoroughly review these complaints and 

respond.

Former Brooklyn [New York] Business 

Owners Plead Guilty in Scheme to Sell 

Misbranded Beef Products

New Oxford [Pennsylvania] Veterinarian 

Sentenced for Defrauding the U.S. 

Department of Agriculture

Former USDA Animal Inspector Sentenced 

for Accepting Bribes

Braymer [Missouri] Man Sentenced to 

32 Years for Cattle Fraud Scheme That Led 

to Murders

Nebraska Beef, Ltd. and 2 Former 

Employees Sentenced for USDA Violations

Maryland Livestock Brokers Sentenced to 

30 Months’ Imprisonment for Exporting 

Dairy Cattle Through Fraudulent Health 

Certificates

2

 Includes convictions and diversions. 

Cattle on a farm. Photo by Lance Cheung from USDA’s Flickr 

account. It does not depict any particular audit or investigation.
170	 Section III | Other Information

5

Animal and Plant Health

The Animal and Plant Health Inspection 

Service (APHIS) protects the health of U.S. 

agriculture and natural resources against 

invasive pests and diseases, regulates 

genetically engineered crops, administers 

the Animal Welfare Act (AWA) and the 

Horse Protection Act, and helps people 

and wildlife coexist. APHIS also certifies 

the health of U.S. agricultural exports and 

resolves sanitary (animal) and phytosanitary 

(plant) issues to open, expand, and maintain 

markets for U.S plant and animal products. 

It is responsible for protecting 900 million 

acres of farmland, facilitating the movement 

of $177 billion worth of U.S. agricultural 

goods, and keeping 21.6 million Americans 

employed in agriculture-related industries. 

According to APHIS’ 2021 Impact Report, 

keeping U.S. agriculture healthy intersects 

with some of the most pressing issues of 

our time: zoonotic diseases (diseases that 

move between animals and people), public 

health, climate change, global population 

growth, and food security. In FY 2023, 

APHIS received more than $1.4 billion 

to carry out its mission. Of that amount, 

$1.1 billion is to protect agriculture from 

pests and diseases, address sanitary and 

phytosanitary trade concerns, and enforce 

animal care legislation. APHIS’ Fiscal 

Years 2023-2027 Strategic 

Plan highlights its role 

in eradicating plant and 

animal diseases; innovating 

with new technologies to 

safeguard agricultural health, 

ensure animal welfare, and manage wildlife 

conflict; and responding to zoonotic and 

emerging diseases. 

OIG’s work found that APHIS also faces 

challenges with data integrity, regulatory 

compliance, and emergency preparedness. 

U.S. agriculture has evolved rapidly over the 

years, and public interest in animal welfare 

has increased. As such, APHIS must adapt 

to the increased use of analytics to support 

decision and policy making, strengthen and 

deploy monitoring and protocols in response 

to changes in domestic pest and disease 

occurrences, and prepare adequately 

for potential disease outbreaks. We also 

continue to investigate allegations related 

to animal welfare, including dogfighting and 

cockfighting. The provisions of AWA were 

designed to protect animals from being 

used in illegal fighting ventures, which 

often entail other forms of criminal activity. 

OIG continues to work vigorously with our 

Federal, State, and local partners to resolve 

AWA allegations and ensure the individuals 

participating in this type of animal cruelty are 

brought to justice.

Spotted Lanternfly specimens at an Animal and Plant Health 

Inspection Service field office. The Spotted Lanternfly is a 

destructive insect that feeds on a wide range of fruit, ornamental, 

and hardwood trees, including grapes, apples, walnut, and oak; 

a serious threat to the United States’ agriculture and natural 

resources. Photo by Preston Keres from USDA’s Flickr account. It 

does not depict any particular audit or investigation.
USDA |2023 Agency Financial Report 171

6

Example Report 

Summary

In the first finding of our 

2022 report, Cattle Health 

Program Disease Incident 

Response, we found that APHIS did not 

adequately manage identified risks to its 

animal disease tracing capabilities. This 

occurred because APHIS did not sufficiently 

analyze the risks’ significance to determine 

what mitigating actions APHIS or its 

cooperators should take. As a result, APHIS’ 

ability to timely and effectively respond to 

cattle disease incidents may be adversely 

impacted—potentially slowing the tracing 

process and increasing the likelihood of 

disease spread. Additionally, cattle producers’ 

business operations may be affected. We 

recommended that APHIS analyze animal 

disease traceability risks by estimating the 

risks’ significance and, based on the results, 

determine what actions are necessary to 

mitigate the risks. APHIS agreed with our 

recommendations.

OIG closed approximately 43 investigations 

involving plant and animal health during 

this time, obtaining 32 administrative and 

181 criminal outcomes and more than 

$2 million in monetary results.

USDA OIG Highlighted Work 

Issued June 2020–2023: 

Plant and Animal Health

Plant Pest and Disease Management 

and Disaster Prevention Program (Report 

33601-0001-21, issued 1/3/23)

Cattle Health Program Disease Incident 

Response (Report 33601-0003-41, 

issued 11/28/22)

Follow-up on Smuggling Interdiction 

and Trade Compliance Program (Report 

33601-0004-23, issued 9/29/21)*

Controls Over Select Agents (Report 

33701-0002-21, issued 7/27/21)*

Animal Care Program Oversight of Dog 

Breeders (Report 33601-0002-31, issued 

6/30/21)*

Follow-Up to Animal and Plant Health 

Inspection Service’s Controls Over 

Licensing of Animal Exhibitors (Report 

33601-0003-23, issued 3/12/21)*

National Veterinary Stockpile Oversight

(Report 33701-0001-21, issued 9/23/20)*

Recommendation Progress**

OIG issued 7 audit products with 52 

recommendations,11 of which 

remain open. 

* Indicates that all recommendations in the report are closed.

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.
172	 Section III | Other Information

7

USDA OIG Highlighted 

Investigations Closed 

June 2020–2023: 

Plant and Animal Health

Crossville [Tennessee] Man Convicted of 

Drug Conspiracy and Other Crimes

Lead Defendant in Dog-Fighting Operation 

Sentenced to Federal Prison

Drug Trafficking and Dogfighting Ringleader 

Sentenced to 30 Years in Prison

Final Defendants Sentenced in Federal Dog 

Fighting Case

Kent County [Delaware] Man Sentenced 

to Incarceration for Drugs, Gun and Dog 

Fighting

Pallett Recycling Company to Pay $100,000 

Fine and Former Owner Sentenced for 

Environmental Crime

“Chicken Joe” Sentenced to 16 Months 

in Prison for Conspiring to Run an Animal 

Fighting Operation

A variety of rangeland plants thrive and grow taller than average in 

this valley floor where soil water collects from the nearby hillside 

runoff. The U.S. Department of Agriculture was able to help this 

area thrive by aiding in the reduction of the grasshopper population. 

Photo by Lance Cheung from USDA’s Flickr account. It does not 

depict any particular audit or investigation. 
USDA |2023 Agency Financial Report 173

8

Cybersecurity and 

Information Technology

To provide benefits and services to the 

American public, USDA must efficiently 

manage vast amounts of data. The Office 

of the Chief Information Officer (OCIO) 

supports USDA’s mission through innovative, 

secure, and cost-effective IT solutions 

and services. According to the Federal 

IT Dashboard, the Department plans to 

spend more than $3.1 billion on IT-related 

initiatives in FY 2023. Members of the public 

apply for and access many USDA programs, 

benefits, and other services through online 

or mobile portals, which can require the 

transfer of sensitive information. In addition, 

USDA employees must be able to access, 

use, and communicate this information 

reliably and timely. 

The Office of Management and Budget 

(OMB) establishes standards for an effective 

level of security and considers “Managed 

and Measurable” to be a sufficient 

level. However, our work has found 

consistent weaknesses with IT-related 

initiatives since the Federal Information 

Security Modernization Act of 2014 (FISMA) 

was enacted. Specifically, USDA has not 

reached the “Managed and Measurable” 

level for the scope of this report. We found 

the Department’s maturity level remained 

at the “Consistently Implemented” level for 

this timeframe, which indicates an ineffective 

level of security based on OMB’s criteria. 

The Department and its agencies must 

develop and implement an effective plan 

to mitigate security weaknesses identified in 

the prior fiscal year recommendations. The 

Department thus faces a significant challenge 

in safeguarding information by protecting the 

security, confidentiality, and integrity of its 

IT infrastructure, even as it allows authorized 

users to access and use this 

information. 

Furthermore, GAO has 

designated cybersecurity 

as a Governmentwide highrisk area since 1997. GAO expanded this 

high-risk area in 2003 to include protection 

of critical cyber infrastructure and again in 

2015 to include protecting the privacy of 

personally identifiable information.

We have issued additional IT security-related 

reports, which have been redacted due to 

sensitive content and are being withheld from 

public release due to concerns about the 

risk of circumvention of law. OIG’s Office of 

Investigations also conducts reviews in this 

area.

Courtesy Photo/AdobeStock.
174	 Section III | Other Information

9

Example Report Summary

According to the U.S. Department of 

Agriculture, Office of the Chief Information 

Officer, Fiscal Year 2022 Federal Information 

Security Modernization Act Audit, we found 

that USDA continues to take positive steps 

to improve its IT security posture, but many 

weaknesses remain. Out of 25 previously 

open recommendations identified during FY 

2020 and FY 2021 FISMA performance audits, 

we determined USDA successfully closed 

8 recommendations during our fieldwork 

that ended on June 30, 2022. We have 

also issued seven new recommendations 

based on security weaknesses identified in 

FY 2022. OCIO concurred with all the findings 

and recommendations in this report.

USDA OIG Highlighted 

Investigations Closed June 

2020-2023: Cybersecurity and 

Information Technology

OIG closed two investigations involving 

cybersecurity and IT during this time, 

obtaining one administrative outcome. 

No press releases are available for these 

cases.

USDA OIG Highlighted Work 

Issued June 2020–2023: 

Cybersecurity and Information 

Technology

Security Testing of a Selected USDA

Network (50801-0004-12, issued 

12/15/22)*

U.S. Department of Agriculture, Office 

of Chief Information Officer, Fiscal Year 

2022 Federal Information Security 

Modernization Act (50503-0009-12, 

issued 9/27/22)

Secure Configuration of USDA’s 

Virtualization Platforms (50801-0003-12, 

issued 8/18/22)

U.S. Department of Agriculture, Office 

of the Chief Information Officer, Fiscal 

Year 2021 Federal Information Security 

Modernization Act (50503-0005-12, 

issued 10/29/21)*

Security Over USDA Web Applications

(50801-0002-12, issued 10/27/21)

USDA’s Information Technology Incident 

Response Consideration (88801-0001-

12, issued 6/2/21)*

USDA’s Security Controls Over the 

Prevention and Mitigation of Ransomware

(50501-0024-12, issued 2/25/21)*

U.S. Department of Agriculture, Office 

of the Chief Information Officer, Fiscal 

Year 2020 Federal Information Security 

Modernization Act (50503-0003-12, 

issued 10/29/20)*

Security Over Select 

USDA Agencies’ Networks 

and Systems FY 2019

(50501-0022-12 issued 

9/30/20)

Implementation of the IT Modernization 

Centers of Excellence Improvements 

(50801-0001-12, issued 9/23/20)*

Recommendation Progress**

OIG issued 10 audit products with 

63 recommendations, 8 of which 

remain open. 

* Indicates that all recommendations in the report are 

 closed. 

** Indicates that the report recommendation statuses 

are up to date as of July 31, 2023.
USDA |2023 Agency Financial Report 175

10

Challenge 2: 

Providing Benefits

USDA manages more than 300 programs 

that provide a variety of services to the 

American public. Many of these programs 

provide essential services, such as disaster 

assistance ($563 million), crop insurance 

($13.2 billion), nutrition assistance programs 

($146.7 billion), farm commodity programs 

($9.1 billion), and more. Collectively, these 

programs account for over 80 percent of 

USDA’s FY 2023 funding. 

Effective oversight and monitoring of USDA’s 

programs and operations are vital. This 

oversight ensures that funds reach those for 

whom they are intended and that programs 

are efficient, produce reliable results, and 

comply with applicable laws and regulations. 

Program integrity and proper stewardship 

of resources are significant responsibilities 

of the Department; ineffective oversight 

and accountability can negatively impact 

consumer confidence in USDA programs. 

Due to the impact of these programs and 

the large funding amounts involved, the 

Department must employ efficient processes 

within its programs and provide effective 

oversight to ensure program integrity. These 

actions help mitigate instances of fraud, 

waste, and abuse and ensure benefits 

reach those for whom they are intended. 

The following sections summarize USDA’s 

challenges and progress with integrity 

of benefits related to food and nutrition 

programs and grant oversight.

Food and Nutrition 

Assistance Programs

Food and nutrition assistance programs 

play significant roles in combating food 

insecurity and reducing hunger for children, 

low-income families, Tribal Nations, and 

the elderly. The Food and Nutrition Service 

(FNS) administers 16 Federal nutrition 

assistance programs, including the Special 

Supplemental Nutrition Program for 

Women, Infants, and Children (WIC); the 

Supplemental Nutrition Assistance Program 

(SNAP); and school meals. 

The onset of the coronavirus disease 

2019 (COVID-19) pandemic generated 

Organic carrots sold at a farmers’ market 

that uses a token system for people who 

want to use debit and the U.S. Department 

of Agriculture’s Food and Nutrition Service 

Electronic Benefits Transfer card. USDA 

Photo by Lance Cheung from USDA’s Flickr 

account. It does not depict any particular 

audit or investigation. 
176	 Section III | Other Information

11

many changes to USDA’s food and 

nutrition assistance programs. Congress 

passed several laws to combat the 

impacts of COVID-19, including the

Families First Coronavirus Response Act

(FFCRA), the Coronavirus Aid, Relief, 

and Economic Security (CARES) Act, 

and the American Rescue Plan Act of 

2021. These acts provided significant 

funding to expand the scope and 

coverage of existing USDA benefits 

programs through greater administrative 

flexibilities. USDA also implemented 

temporary programs, such as the Farmers 

to Families Food Box Program and 

the Pandemic Electronic Benefits Transfer 

program, to make benefits even more 

accessible during the COVID-19 pandemic. 

In FY 2023, FNS was expected to receive 

$146.7 billion out of the Department’s 

projected $209.3 billion total outlays, 

accounting for 73 percent of the 

Department’s funding. 

Since a high percentage 

of USDA’s total funding is 

awarded to FNS for food 

and nutrition assistance 

programs, FNS must 

safeguard the integrity of its program funds 

and ensure the programs are delivered 

and used as intended. However, our work 

has found that the Department continues 

to face challenges with nutrition program 

administration and oversight, especially with 

the implementation of new pandemic-related 

programs that increased participation and 

introduced program flexibilities. Based on our 

investigative monetary results, USDA loses 

millions of dollars every year to fraud and 

crime associated with SNAP and other 

FNS food and nutrition assistance programs. 

Since these programs are vital to Americans, 

FNS must strengthen its oversight of these 

programs and remain vigilant against fraud, 

waste, and abuse. 

Courtesy Photo/AdobeStock.
USDA |2023 Agency Financial Report 177

12

Example Report Summary

In our inspection report of The Emergency 

Food Assistance Program (TEFAP), we 

reviewed the flexibilities FNS made available 

to the State agencies during the pandemic 

and whether FNS’ oversight of State 

agencies and Eligible Recipient Agencies 

(ERA) were properly accounting for and 

using the program’s administrative funds 

correctly. We found that State agencies 

did not always request flexibilities in 

writing, as required by Federal regulation; 

FNS regional office personnel did not ensure 

they provided written approval of the State 

agencies’ requests prior to implementation, 

as directed by the FNS National Office; 

FNS approved a State agency’s request to 

implement an unallowable flexibility; and 

management evaluation reviewers did not 

support their determinations of State agency 

and ERA compliance or non-compliance 

with Federal and FNS program requirements 

in their workpapers. We recommended 

that FNS establish and implement 

written procedures for its TEFAP State 

plan amendment process; work with the 

regional offices to confirm that TEFAP State 

plans reflect current operations and are 

approved in writing; perform a review of 

the TEFAP program-specific management 

evaluation module to provide clear 

instructions for retaining documentation; and 

provide management evaluation reviewers 

with training. FNS agreed with our findings 

and recommendations. 

USDA OIG Highlighted 

Work Issued June 

2020–2023: Food and 

Nutrition Programs

Supplemental Nutrition Assistance 

Program Waiver Process 

(27601-0006-41, issued 1/3/23)

COVID-19—Oversight of the Emergency 

Food Assistance Program—Final Report

(27801-0001-21, issued 8/18/22)*

COVID-19—Farmers to Families Food 

Box Program Administration—Interim

Report (01801-0001-22(1), issued 

6/24/22)*

COVID-19—Oversight of the Emergency 

Food Assistance Program—Interim 

Report (27801-0001-21(1), issued 

8/25/21)

COVID-19—Supplemental Nutrition 

Assistance Program Online Purchasing in

Response to the Coronavirus 

Disease 2019 (27801-0003-22, issued 

8/25/21)

Consolidated Report of FNS and Selected 

State Agencies’ Controls Over [Summer 

Food Service Program] SFSP (27601- 

0005-41, issued 9/18/20)

Recommendation Progress**

OIG issued 8 audit products with 28 

recommendations, 17 of which 

remain open. 

* Indicates that all recommendations in the report are closed. 

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.
178	 Section III | Other Information

13

USDA OIG Highlighted 

Investigations Closed June 

2020-2023: Food and Nutrition 

Programs

OIG closed approximately 452 investigations 

related to food and nutrition programs during 

this time, obtaining 1,096 administrative, 

1,485 criminal, and 5 civil outcomes and 

more than $192 million in monetary results. 

These programs were created to provide 

food and nutrition to those who truly need 

this assistance. OIG will continue to dedicate 

investigative resources and work with our law 

enforcement and prosecutorial partners to 

protect the integrity of these programs.

Final Defendant Sentenced to Prison in All 

About Giving Fraud

Director of Not-For-Profit in Henderson [North 

Carolina] Sentenced for Theft of Federal 

Funds

Brookdale [New York] Hospital Agrees to 

Civil Settlement to Resolve Allegations That 

Former Employees Defrauded a Federally 

Funded Nutrition Program

Texas Woman Sentenced for Fraud and 

Money Laundering Conspiracies Targeting 

Federally Funded Meal Programs for 

Underprivileged Youth

Guam Seafood Store Owner Sentenced to 21 

Months Imprisonment for Food Stamp Fraud

East Bay [California] Convenience Store 

Owner Sentenced to More Than 3 Years 

in Prison for Role in Food Stamp Fraud 

Conspiracies

Convenience Store Owner, Worker, 

Sentenced to Prison for Defrauding Federal 

Food Stamp Program

Brooklyn [New York] Yeshiva 

Admits to Pervasive 

Program and Benefit Fraud 

Conspiracy

Final Defendant Sentenced 

for Role in Conspiracy to Defraud U.S. 

Department of Agriculture

Courtesy Photo/AdobeStock.
USDA |2023 Agency Financial Report 179

14

Grants Oversight

USDA distributes and oversees billions of 

dollars in grants each fiscal year. According 

to USASpending.gov, in FY 2022 USDA 

obligated more than $57 billion for grants that 

were used for numerous purposes, including 

disaster relief, block grants, and market 

development programs. USDA must ensure 

grants are used for the purposes identified 

in the grant award and within specific 

limitations and regulations. Further, the 

timely receipt of accurate financial records 

and performance reports from grantees is 

necessary for agencies to ensure grant funds 

are properly spent and intended results are 

achieved. Federal agencies are required 

to follow OMB guidance to award, monitor, 

and assess the success of grants.3

 This 

guidance provides consistent and uniform 

Governmentwide policies and procedures 

for management of the agencies’ grants and 

agreements. 

Correspondingly, the 2021 Infrastructure 

Investment and Jobs Act (IIJA) provided 

USDA more than $8.3 billion in funding to 

improve the Nation’s 

energy, broadband access, 

transportation, and other 

infrastructure projects. 

The Inflation Reduction 

Act provided the Natural 

Resources Conservation Service with 

$19.5 billion in additional funds over 5 years 

for its existing conservation programs. Also, 

the American Rescue Plan Act provided 

additional relief to address the continued 

impact of COVID-19 on the economy, 

public health, State and local governments, 

individuals, and businesses.

OIG’s oversight work has identified 

weaknesses in USDA’s management of 

grant processes. While some weaknesses 

were related to internal controls, others 

were related to criminal acts such as theft 

or misuse of funds. Any weaknesses in 

these processes can lead to misspent funds 

and ineffective programs. As the number 

of grants increases, it is imperative that 

USDA address weaknesses in the grant 

award and monitoring process to ensure 

grant funds are used fairly, correctly, and 

transparently. 

Debris in a flooded area following a 

hurricane. Photo by Lance Cheung from 

USDA’s Flickr account. It does not depict 

any particular audit or investigation. 

3

 2 C.F.R. § 200.
180	 Section III | Other Information

15

Example Report Summary

Our FY 2022 report Oversight of the 

Agricultural Trade Promotion Program 

(ATP) reviewed the process that the Foreign 

Agricultural Service (FAS) used to award 

$300 million in ATP funding during FY 2019. 

We found that FAS awarded $300 million 

in ATP funding to applicants who may not 

have been the most meritorious based 

on the announced criteria and program 

regulations. This occurred because FAS did 

not make establishing controls over its grant 

programs a priority even though FAS agreed 

to do so in response to recommendations 

OIG made in 2014. Additionally, FAS did 

not maintain sufficient documentation about 

the reviews performed on applications and 

the selections made, which 

impaired our ability to fully 

evaluate those reviews and 

selections. FAS officials 

explained ATP was developed 

very quickly. FAS officials 

stated that the best way to develop the 

new program quickly was to model it on 

similar market development programs that 

were already in use and to use analysis 

that had recently been conducted for these 

same potential applicants. However, we 

identified control weaknesses and significant 

deviations from established internal controls 

and processes that call into question the 

merit of the awards made. FAS agreed to 

implement our recommendations.

Container ships docked at a terminal. 

USDA photo by Lance Cheung from USDA’s 

Flickr account. It does not depict any 

particular audit or investigation.
USDA |2023 Agency Financial Report 181

16

USDA OIG Highlighted Work 

Issued June 2020–2023: Grants 

Oversight

Wildfires and Hurricanes Indemnity

Program—Puerto Rico (03702-0003-31, 

issued 3/24/23)

Oversight of the Agricultural Trade

Promotion Program (07601-0001-24, 

issued 8/29/22)

Florida Citrus Recovery Block Grant

Program (03702-0001-22, issued 6/30/21)*

Hurricane Disaster Assistance—

Emergency Watershed Protection Program

(10702-0001-23, issued 6/25/21)

2017 Hurricane Relief Emergency

Conservation Program (03702-0002-23, 

issued 6/9/21)

Forest Service Grant for Roadless Area

Management in the State of Alaska

(08801-0001-24, issued 12/15/20)*

Agricultural Marketing Service Controls 

Over the Specialty Crop Block Grant 

Program (01601-0002-23, issued 10/6/20)*

Recommendation Progress**

OIG issued 7 audit products with 40 

recommendations, 17 of which 

remain open. 

USDA OIG Highlighted 

Investigations Closed 

June 2020-2023: 

Grants Oversight

OIG closed approximately 

16 investigations involving grant fraud 

during this time, obtaining 13 administrative 

and 13 criminal outcomes and more than 

$6 million in monetary results. Grant funds 

are awarded for a specific “public purpose” 

and grantees must use those funds as 

agreed and within certain parameters, to 

include the granting agency’s guidelines. 

Common grant fraud risks include 

misappropriation and/or misuse of funds, 

theft of Government funds, misrepresentation 

to obtain the funds, and unreported conflicts 

of interest to guarantee receipt of the funds. 

Husband and Wife Sentenced in Scheme to 

Defraud the United States

Newport Woman Pleads Guilty to Wire Fraud 

and Stealing from Federally Funded Program

* Indicates that all recommendations in the report are 

 closed. 

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.

Citrus nursery operations. Maintaining a clean supply of citrus 

plants for homeowners and commercial producers is a key 

component of the U.S. Department of Agriculture Animal and Plant 

Health Inspection Service citrus disease program. USDA photo by 

Timothy Riley from USDA’s Flickr account. It does not depict any 

particular audit or investigation. 
182	 Section III | Other Information

17

Outreach

The Department has prioritized outreach 

efforts in its Strategic Plan Fiscal Years 

2022–2026. For example, USDA plans to 

prioritize upholding civil rights and building 

trust with underserved communities, 

including Tribal Nations, through equitable 

and inclusive customer service and actions. 

The Department also plans to design, 

implement, and administer programs in a 

way that increases access and program 

participation for underserved communities. 

Additionally, the Department intends to 

ensure USDA investments and services are 

directed to underserved communities, using 

data to understand who benefits from USDA 

programs and services.

Our prior work shows that to implement 

effective, efficient agricultural programs 

that also reach underrepresented groups, 

USDA must improve its outreach efforts, 

including performance management, 

oversight of award and complaints 

processes, and data collection. While 

USDA has made progress in this area, 

the Department must continue to increase 

access to underserved and hard-to-reach 

populations, remove barriers to participation, 

and improve the delivery of its programs. 

Example Report 

Summary

A 2021 OIG audit reviewed 

and evaluated the Office 

of Partnerships and Public 

Engagement (OPPE) policies, procedures, 

and internal controls related to the Outreach 

and Assistance for Socially Disadvantaged 

Farmers and Ranchers and Veteran Farmers 

and Ranchers Program’s (2501 Program) 

grant management process and the 

2501 Program grants awarded in FYs 2018 

and 2019. Additionally, we reviewed the 

implementation of recommendations from 

prior audits. 

We found that 6 of the 18 applications we 

reviewed were not eligible to receive grant 

funds; as a result, OPPE awarded a total of 

more than $1.1 million in grant funds to 3 of 

the 6 ineligible entities. We also determined 

that the independent review panel did not 

follow established guidance and did not 

apply a consistent methodology to award 

points; as a result, OPPE cannot ensure 

it awarded FYs 2018 and 2019 grants—

totaling more than $25 million—to the 

worthiest applicants. In addition, we 

determined that program personnel did not 

follow procedures OPPE established to 

monitor and evaluate grantee performance 

effectively; as a result, OPPE cannot 

assess whether it achieved the objectives 

of the 2501 Program and whether program 

resources are protected. Finally, we 

determined that OPPE did not establish 

a performance plan and set performance 

goals and indicators to measure and 

assess its progress towards achieving the 

2501 Program’s purpose. OPPE agreed with 

our recommendations. 
USDA |2023 Agency Financial Report 183

18

USDA OIG Highlighted Work 

Issued June 2020–2023: Outreach

Outreach and Assistance for Socially

Disadvantaged Farmers and Ranchers

and Veteran Farmers and Ranchers 

Program (2501 Program) in Fiscal Years

2018 and 2019 (91601-0001-21, issued 

11/10/21)

USDA Oversight of Civil Rights

Complaints (60601-0001-21, issued 

9/22/21)

Market Facilitation Program—Interim

Report (03601-0003-31(1), issued 

9/30/20)

Recommendation Progress**

OIG issued 3 audit products with 

42 recommendations, 15 of which 

remain open. 

USDA OIG Highlighted 

Investigations Closed June 2020-

2023: Outreach

OIG conducted approximately four 

investigations involving fraud against 

programs benefiting underrepresented 

groups during this time, obtaining more than 

$11 million in monetary results. 

Seven Defendants Sentenced to Federal 

Prison in $11.5 Million Fraud Case

* Indicates that all recommendations in the report are closed. 

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.

Courtesy Photo/AdobeStock.
184	 Section III | Other Information

19

Challenge 3: 

Delivering Efficient Programs

The effectiveness and efficiency with which 

USDA manages its assets are critical. With 

such a diverse portfolio of programs, the 

Department must execute well-designed 

programs to ensure diligent oversight 

of Federal funds. However, USDA has 

the continuing challenge of designing, 

developing, and implementing programs 

that reliably achieve their intended results. 

Monitoring program performance is also 

essential to ensure that USDA programs 

and benefits are delivered effectively and 

are accessible to all the communities 

USDA serves. To accomplish this goal, the 

Department must have sufficient controls to 

ensure the data used to evaluate program 

performance, measure impact, and make 

evidence-based decisions are complete, 

timely, and accurate. In addition, since 

USDA received significant additional 

funding through FFCRA, the CARES Act, 

the American Rescue Plan Act, IIJA, and 

the Inflation Reduction Act to implement 

its various responsibilities, the Department 

needs to remain more vigilant than ever in its 

efforts to strengthen financial management. 

The following section summarizes USDA’s 

challenges and progress in the areas of 

financial reporting and data integrity. 

Financial Reporting

Financial reporting serves as the foundation 

for responsible fiscal management and 

transparency. Accurate and comprehensive 

financial reporting allows USDA to account 

for its financial activities, expenditures, 

and revenue sources, demonstrating 

accountability and responsible stewardship 

of public funds. It enables the agency to 

assess the effectiveness and efficiency of its 

programs, facilitating data-driven decisionmaking to optimize resource allocation 

and program outcomes. Additionally, 

financial reporting ensures compliance with 

relevant laws, regulations, and accounting 

standards, reducing the risk of legal and 

financial repercussions. Transparent 

financial reporting also fosters trust and 

confidence among stakeholders, including 

the public, Congress, and other Government 

agencies, reinforcing USDA’s credibility 

and commitment to supporting American 

agriculture, rural communities, and food 

security. 

As required by law, OIG either conducts 

or oversees audits of the financial 

statements for the Department and 

four component agencies annually to 

determine if the statements are fairly 

presented in accordance with generally 

accepted accounting principles. In addition, 

OIG reviews internal controls over financial 

reporting and tests compliance with 

applicable laws and regulations. These 

financial statements account for USDA’s 

costs and revenues, assets and liabilities, 
USDA |2023 Agency Financial Report 185

20

and other information. In addition, the

Payment Integrity Information Act of 2019 

(PIIA) collectively requires agencies to 

periodically review all programs and activities 

to identify those susceptible to significant 

improper payments.4 An improper payment 

is any payment that should not have been 

made or that was made in an incorrect 

amount under statutory, contractual, 

administrative, or other legally applicable 

requirements. Not all improper payments are 

fraudulent, and not all improper payments 

represent a loss to the Government. 

However, all improper payments can affect 

the integrity of Government programs and 

compromise the public’s trust in the Federal 

Government. 

Although USDA has 

addressed longstanding 

deficiencies with financial 

reporting, it continues to 

face challenges reaching 

full compliance with Federal 

requirements for improper 

payments. As USDA works to address 

improper payments and improve the quality 

of its financial reporting, we continue to 

emphasize the importance of complying 

with improper payment and financial 

reporting requirements, especially those 

related to improper payment information. 

If USDA addresses key weaknesses, the 

public can be more confident that USDA 

conscientiously and effectively accounts for, 

uses, and recovers taxpayer dollars.

Courtesy Photo/AdobeStock.

4

 The Payment Integrity Information Act of 2019, Pub. L. No. 116-117 (2020), repealed the Improper Payments 

 Information Act of 2002, Pub. L. No. 107-300; Improper Payments Elimination and Recovery Act of 2010, Pub. L. 

 No. 111-204; and the Improper Payments Elimination and Recovery Improvement Act of 2012, Pub. L. 

 No. 112-248.
186	 Section III | Other Information

21

Example Report Summary

Our review of compliance with laws and 

regulations identified noncompliance with 

PIIA. We found that USDA was not compliant 

with four of the six PIIA requirements for 

FY 2022. Specifically, 4 of the 14 reporting 

Phase 2 programs and 1 Phase 1 program 

did not fully comply with PIIA requirements. 

Four Phase 2 programs did not meet the 

PIIA compliance requirements on at least 

two of the following: reduction targets, 

corrective action plans, or improper payment 

rate of less than 10 percent. We also 

found that USDA did not ensure that one 

Phase 1 program completed an FY 2022 

risk assessment, as required by PIIA, and 

reporting in the accompanying materials 

incorrectly stated that the program did 

not need to complete an FY 2022 risk 

assessment. The agency agreed with our 

recommendations. 

USDA OIG Highlighted Work 

Issued June 2020–2023: Financial 

Reporting

USDA’s Compliance with Improper 

Payment Requirements for Fiscal Year 

2022 (50024-0003-24, issued 5/22/23)

USDA’s Consolidated Financial 

Statements for Fiscal Years 2022 and 

2021 (50401-0021-11, issued 11/14/22)*

Commodity Credit Corporation’s Financial 

Statements for Fiscal Years 2022 and 

2021 (06403-0005-11, issued 11/9/22)

Natural Resources Conservation 

Service’s Financial Statements for Fiscal 

Years 2022 and 2021 (10403-0005-11, 

issued 11/9/22)

USDA’s Compliance 

with Improper Payment 

Requirements for Fiscal 

Year 2021 (50024-0002-

24, issued 6/28/22)*

USDA’s Consolidated Financial 

Statements for Fiscal Years 2021 and 

2020 (50401-0020-11, issued 11/15/21)

Commodity Credit Corporation’s Financial 

Statements for Fiscal Years 2021 and 

2020 (06403-0004-11, issued 11/15/21)*

Natural Resources Conservation 

Service’s Financial Statements for Fiscal 

Years 2021 and 2020 (10403-0004-11, 

issued 11/15/21)

Rural Development’s Financial 

Statements for Fiscal Years 2021 and 

2020 (85401-0012-11, issued 11/9/21)*

Forest Service Use of Settlement Funds

(08601-0011-41, issued 3/24/21)*

U.S. Department of Agriculture’s 

Consolidated Financial Statements for 

Fiscal Years 2020 and 2019 (50401-

0019-11, issued 12/14/20)*

Commodity Credit Corporation’s Financial 

Statements for Fiscal Years 2020 and 

2019 (06403-0003-11, issued 12/8/20)*

Federal Crop Insurance Corporation/

Risk Management Agency’s Financial 

Statements for Fiscal Years 2020 and 

2019 (05401-0012-11, issued 12/8/20)*

Recommendation Progress**

OIG issued 13 products with 

50 recommendations, 16 of which 

remain open. 

* Indicates that all recommendations in the report are closed.

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.
USDA |2023 Agency Financial Report 187

22

Data Integrity

USDA creates and manages multitudes 

of data across hundreds of applications 

and data stores. They are used for 

numerous purposes, including research, 

program initiatives, policymaking, and 

financial transparency. These data allow 

the Department to innovate, measure 

progress and success, make evidencebased decisions, and improve the delivery 

of services and programs. According to 

USDA’s data strategy, the Department has 

an opportunity to harness its vast data assets 

strategically to improve internal decisionmaking and efficient use of resources, 

maximize the impact of citizen-facing 

programs, and provide the public and private 

industry with easy access to data that can 

solve national problems and drive innovation. 

However, USDA has faced challenges with 

maintaining its data integrity. For example, we 

published four reports that found issues with 

maintaining complete and accurate payment 

information, keeping consistent records, and 

reporting accurate and timely data, which 

leads to further challenges for USDA in 

reaching its goal of becoming a facts-based, 

data-driven organization. 

Example Report 

Summary

As stated in the executive 

summary of USDA’s 

Compliance with the 

Geospatial Data Act for Fiscal 

Year 2022, the purpose of the Geospatial 

Data Act (GDA) is to minimize duplication 

of geospatial activities across agencies 

and improve collaboration, reduce waste, 

codify previous executive actions, and give 

Congress an oversight role for the Federal 

Government’s multibillion-dollar investments 

in geospatial data. Within USDA’s OCIO, 

the Enterprise Geospatial Management 

Office (EGMO) oversees, coordinates, and 

facilitates USDA’s implementation of geospatial 

policies, directives, requirements, and data 

management. 

Although we recognize that USDA has made 

progress toward complying with certain 

aspects of the GDA, we found that it was not 

compliant with 6 of the 13 covered agency 

responsibilities. Additionally, we determined 

that the designated oversight entity, EGMO, 

did not have an accurate inventory of 

geospatial assets. As a result, USDA agencies 

inconsistently implemented the GDA. Without 

consistency, USDA is not completely fulfilling 

its role of improving Federal management, 

coordination, and utilization of geospatial data, 

which can negatively impact mission-critical 

business requirements of the Department’s 

infrastructure and emergency response 

capabilities nationwide. OCIO generally 

concurred with our six recommendations.

Courtesy Photo/AdobeStock.
188	 Section III | Other Information

23

USDA OIG Highlighted Work 

Issued June 2020–2023: 

Data Integrity

USDA’s Compliance with the Geospatial 

Data Act for Fiscal Year 2022 (50501-

0026-12, issued 9/30/22)

USDA’s Digital Accountability and 

Transparency Act Compliance Efforts for 

Fiscal Years 2020 and 2021 (11601-0002-

12, issued 11/3/21)*

U.S. Department of Agriculture’s 2020 

Compliance with the Geospatial Data Act

(50501-0023-12, issued 9/29/20)*

2017 Emergency Assistance for 

Honeybee Claims (03702-0001-23, 

issued 9/28/20)

Recommendation Progress**

OIG issued 4 audit products with 

33 recommendations, 11 of which 

remain open.

* Indicates that all recommendations in the report are closed. 

** Indicates that the report recommendation statuses are up to date as of July 31, 2023.

Courtesy Photo/AdobeStock.
USDA |2023 Agency Financial Report 189

24

Acronyms and Abbreviations

2501 Program ......Outreach and Assistance 

for Socially Disadvantaged 

Farmers and Ranchers 

and Veteran Farmers and 

Ranchers Program

APHIS .................. Animal and Plant Health 

Inspection Service

ATP......................Agricultural Trade Program

AWA.....................Animal Welfare Act

CARES ................Coronavirus Aid, Relief, 

and Economic Security

C.F.R. ...................Code of Federal 

Regulations

COVID-19 ............coronavirus disease 2019

EGMO ..................Enterprise Geospatial 

Management Office

ERA .....................Eligible Recipient 

Agencies

FAS......................Foreign Agricultural 

Service

FFCRA .................Families First Coronavirus 

Response Act

FISMA ..................Federal Information 

Security Modernization Act 

of 2014

FNS .....................Food and Nutrition Service

FSIS..................... Food Safety and 

Inspection Service

FY ........................fiscal year

GAO.....................Government Accountability 

Office

GDA .....................Geospatial Data Act

IIJA....................... Infrastructure Investment 

and Jobs Act 

IT .........................information technology

OCIO ...................Office of the Chief 

Information Officer

OIG ......................Office of Inspector General

OMB .................... Office of Management and 

Budget

OPPE................... Office of Partnerships and 

Public Engagement

PIIA ...................... Payment Integrity 

Information Act of 2019

SNAP ...................Supplemental Nutrition 

Assistance Program

TEFAP .................The Emergency Food 

Assistance Program

USDA ...................U.S. Department of 

Agriculture

WIC ......................Special Supplemental 

Nutrition Program for 

Women, Infants, and 

Children
190	 Section III | Other Information

Learn more about USDA OIG

Visit our website: https://usdaoig.oversight.gov/

Follow us on Twitter: @OIGUSDA

How to Report Suspected Wrongdoing in USDA Programs

Fraud, Waste, and Abuse

File complaint online: https://usdaoig.oversight.gov/hotline

Monday–Friday, 9:00 a.m.– 3:00 p.m. ET

In Washington, DC 202-690-1622

Outside DC 800-424-9121

TDD (Call Collect) 202-690-1202

Bribes or Gratuities

202-720-7257 (24 hours)

In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) 

civil rights regulations and policies, the USDA, its Agencies, offices, and employees, 

and institutions participating in or administering USDA programs are prohibited 

from discriminating based on race, color, national origin, religion, sex, gender 

identity (including gender expression), sexual orientation, disability, age, marital 

status, family/parental status, income derived from a public assistance program, 

political beliefs, or reprisal or retaliation for prior civil rights ac-tivity, in any program 

or activity conducted or funded by USDA (not all bases apply to all programs). 

Remedies and complaint filing deadlines vary by program or incident.

Persons with disabilities who require alternative means of communication for program information (e.g., Braille, large print, audiotape, American Sign 

Language, etc.) should contact the responsible Agency or USDA’s TARGET Center at 

(202) 720-2600 (voice and TTY) or contact USDA through the Federal Relay Service at 

(800) 877-8339. Additionally, program information may be made available in 

languages other than English.

To file a program discrimination complaint, complete the USDA Program Discrimination 

Complaint Form, AD-3027, found online at How to File a Program Discrimination Complaint 

and at any USDA office or write a letter addressed to USDA and provide in the letter all of 

the information requested in the form. To request a copy of the complaint form, call (866) 

632-9992. Submit your completed form or letter to USDA by: (1) mail: U.S. Department of 

Agriculture, Office of the Assistant Secretary for Civil Rights, 1400 Independence Avenue, 

SW, Washington, D.C. 20250-9410; (2) fax: (202) 690-7442; or (3) email: program.intake@

usda.gov.

USDA is an equal opportunity provider, employer, and lender. 

All photographs on the front and back covers are from USDA’s Flickr site and are in the 

public domain. They do not depict any particular audit, inspection, or investigation.
USDA | 2023 Agency Financial Report 191

Response to Management Challenges

USDA takes challenges identified by OIG very seriously and is aggressively pursuing corrective actions to 

address these weaknesses. The Department has already completed several corrective actions recommended 

by OIG and Government Accountability Office auditors. We will continue to enhance internal controls to 

remain compliant with Federal laws and regulations, as indicated in the following responses.

CHALLENGE 1: Ensuring Safety and Security 

Food Safety and Inspection Service

FSIS has made progress in improving its oversight of food safety. All food safety-related 

recommendations made between June 2020-2023 have been closed. Additionally, USDA has closed all 

GAO recommendations directed at USDA to address the high-risk area, Federal Oversight of Food 

Safety. GAO has conducted audits regarding Federal Oversight of Food Safety which addressed the 

issue of fragmentation of the U.S. food safety system by creating a single food safety agency. The final 

audit report issued in 2017, Food Safety: A National Strategy Is Needed to Address Fragmentation in 

Federal Oversight. U.S. GAO, contained only one recommendation, which is still open, directed at the 

Executive Office of the President. USDA continues to remain vigilant and proactive in ensuring 

Americans receive wholesome foods. FSIS collaborates with our food safety partners regarding food 

safety. FSIS will continue to improve our inspection strategies and technology systems, and provide 

consistent, documented applications of statutes and regulations. 

Animal Plant Health and Inspection Service, Cattle Health Program Disease Incident 

Response, (33601-0003-41)

Currently, APHIS is developing an analysis of oversight procedures to assess the magnitude of impact, 

likelihood of occurrence, and the nature of the three risks. (1) Official Identification Requirements 

Limited to Interstate Movements, (2) Exclusion of Beef Feeder Cattle from Official Identification 

Requirements, (3) and Inconsistent Collection and Correlation of Identification at Slaughter Facilities. 

Upon completion APHIS will incorporate findings into the traceability program and institute risk 

mitigation procedures for the three identified areas. APHIS is preparing a new traceability rule for 

publication to address the needs and desires for traceability in the industry. 

APHIS is developing additional guidance to provide to field offices that includes the specific 

documentation offices are required to maintain for the Cattle Health Program tuberculosis and 

brucellosis indemnity payments. 

APHIS has completed corrective actions which enable recipients to separately identify their costs for 

each program under Animal Health program umbrella cooperative agreements. 
192 Section III | Other Information

Animal Plant Health and Inspection Service, Plant Pest and Disease Management and 

Disaster Prevention Program, (33601-0001-21) 

APHIS plan to implement a process to track all Plant, Pest, and Disease Management transactions for 

each project from approval through closeout, including Rapid Response.

APHIS Plant, Protection and Quarantine office is developing plans of action to mitigate the risks posed 

by cooperators with an elevated risk level for both active and future agreements. This plan will include 

consideration of the risk in the application process, additions of special measures into an award 

agreement, and review activities to be conducted through the completion of an award.

Office of the Chief Information Office, U.S. Department of Agriculture, Office of the 

Chief Information Officer, Fiscal Year 2022 Federal Information Security Modernization 

Act, (50503-0009-12) 

The Department finalized the "FISMA Improvement Plan" on September 12, 2022. This 

comprehensive 5-year strategic vision includes a detailed improvement plan that tracks projects and 

efforts to improve the USDA Information Security Program and Practices. This is the Department’s 

plan of action to migrate CSAM from NIST SP 800-53 Revision 4 to (NIST Rev 4) SP 800-53 

Revision 5 (NIST Rev 5) controls. In addition, the Department developed an integrated project team to 

manage the project schedule. 

Office of Communications, Security Over USDA Web Applications, (50801-0002-12) 

The Department has implemented a process to prepare and maintain a complete inventory list of all 

public-facing web applications and websites, update this list as changes occur, and perform 

reconciliations of the inventory on a regular basis to ensure it is complete and accurate.

CHALLENGE 2: Providing Benefits 

Food Nutrition Service, Supplemental Nutrition Assistance Program Waiver Process, 

(27601-0006-41) 

FNS is in the process of updating policies and procedures to provide to stakeholders which will ensure 

all SNAP waivers are documented as required. These will include procedures for maintaining adequate 

and proper documentation, including records such as policy decisions and regulatory and statutory 

interpretations, which will ensure official agency records comply with applicable requirements are 

underway and will be completed November 15, 2023.

Food Nutrition Service, COVID-19 Supplemental Nutrition Assistance Program Online 

Purchasing in Response to the Coronavirus Disease 2019, (27801-0003-22) 

FNS provided documentation for review regarding updates to the SNAP Online Purchasing risk 

assessment. FNS will establish a policy for periodic review and updating the assessment. FNS 

established controls for monitoring, evaluating, and documenting SNAP participants’ personal 

information by issuing an internal Standard Operating Procedure in August 2022.
USDA | 2023 Agency Financial Report 193

FNS will finalize the updated risk assessment, to include testing and risk mitigation by the estimated 

completion date of December 31, 2023.

Food Nutrition Service, Consolidated Report of FNS and Selected State Agencies’ 

Controls Over [Summer Food Service Program] SFSP, (27601-0005-41) 

In December 2022, new legislation was signed which made significant changes to the Summer Food 

Service Program (SFSP) and required FNS to work on rule-making to codify these changes before 

guidance and best practices that align with program requirements could be issued. FNS is now 

finalizing guidance to describe how and when State agencies should ensure applicants’ sites do not 

serve the same meal to the same children as other SFSP sites in the same area and are ensuring these 

sites align with the Interim Final Rule to be published in late 2023.

FNS continue to take several actions to improve program processes which include revising guidance, 

establishing a workgroup to update the SFSP Management Evaluation (ME) Guide for fiscal year 

2024, and providing training to regional and State agencies on updated guidance.

Agricultural Marketing Service, COVID-19 Farmers to Families Food Box Program 

Administration - Interim Report, (01801-0001-22)

AMS will establish and implement a policy that includes assessing risks and developing effective controls 

when responding to national emergencies. In addition, AMS is developing and Emergency Acquisition 

Policy and Procedures for Food Purchases by the Departments Commodity Procurement Program (CPP) 

in support of a response to a Presidential declared emergency, completed December 12, 2022. 

Farm Service Agency, Wildfires and Hurricanes Indemnity Program-Puerto Rico, 

(03702-0003-31)

Currently, FSA is updating policies and procedures to strengthen the overall controls and review 

process in regards to tree, bush, and vine losses. FSA will work to establish policy for conducting 

accuracy and applicability reviews when information or data from an outside entity is utilized for FSA 

programs. Updated guidance, Handbook 1-CM Amendment 80 was issued on June 9, 2023, to require 

National Office approval before State or country offices develop policy or procedures. 

Farm Service Agency 2017 Hurricane Relief Emergency Conservation Program, 

(03702-0002-23)

Although the OIG audit of FSA ECP did not directly involve FSA’s management or oversight of grants, 

OIG’s audit of FSA’s Florida Citrus Recovery Block Grant Program (CRBG), identified and ECP 

payment of more than $50,000 to a producer for expenses already paid by the CRBG Program. FSA 

completed corrective actions to address the improper payment by collecting the overpayment amount. 

A determinations on whether relief will be granted are pending. Florida State office received request 

the request for relief from applicable FSA County offices. No applicable receivables were identified by 

External Audits and Investigation Branch as of June 23, 2023.

FSA continue to issue revised guidance and implement national training to improve processes.
194 Section III | Other Information

Natural Resources Conservation Service, Hurricane Disaster Assistance- Emergency 

Watershed Protection Program, (EWP) (10702-0001-23)

NRCS has made great stride in regards to implementing recommendations made by OIG. An 

improvement made to improve program monitoring was a national program database and to improve 

internal controls, NRCS revised the EWP program manual to verify sponsor eligibility and ensure the 

correct and timely completion of project reports. The frequency of reviews of unliquidated obligations 

was increased and performance metrics were added to the manual. 

Office of Partnerships and Public Engagement Formerly OAO, Outreach and Assistance 

for Socially Disadvantaged Farmers and Ranchers and Veteran Farmers and Ranchers 

Program (2501 Program) in Fiscal Years 2018 and 2019, (91601-0001-21)

The OPPE 2501 Program developed and implemented prescreening controls to ensure all SAM checks 

are conducted and documented in an Initial Review Checklist Form. The form captures initial eligibility 

data such as the SAM.gov registration requirement, entity start date, Federal Financial Representations 

and Certification completion, and whether the applicant adhered to the Funding Opportunity 

Announcement (FOA) requirements. Controls have been established to determine eligibility and monitor 

score sheets electronically submitted by the Review Panel, and implemented a revised process for 

recipient selection. Training was received during the 2023 Grant Cycle. Management participated in the 

training to conduct knowledge checks and reinforce process requirements. Program staff have updated 

the 2501 Program’s policies and procedures manual to better minimize fraud, waste, and abuse. Baseline 

monitoring, which includes in-office assessment and desktop monitoring, is conducted on a recurring 

cycle throughout the lifetime of the award. Advanced monitoring, which includes on-site evaluations is 

conducted on a least five percent of active grants and contingent on availability of travel funds. OPPE 

follow established risk-assessment criteria when determining the monitoring schedule and focus area for 

grant recipients. Monitoring controls were developed and implemented to ensure established oversight 

and monitoring activities are performed as prescribed. Internal controls were established to verify 

grantees submit OMB-approved performance progress reports and financial reports. 

Performance and financial reports are reviewed to ensure the required certification language is included 

and the form is not expired. Controls are in place to ensure grantees provide enough detail in their funds 

request and expense justifications to allow OPPE to verify USDA funds are used for their intended 

purpose and that project costs are necessary, reasonable, allowable and allocatable. The Performance 

Improvement Officer (PIO) is working with additional resources to develop performance goals and 

indicators for the 2501 Program and is in the process of working with the Department to develop the 

program evaluation templates to determine the effectiveness and efficiency of the 2501 Program. 

Office of the Assistant Secretary for Civil Rights, USDA Oversight of Civil Rights 

Complaints, (60601-0001-21) 

OASCR has made improvements in support of oversight of civil rights complaints. OASCR has 

revised the Departmental Regulation (DR) 4330-003, Non-discrimination in USDA-Conducted 

Programs and Activities to improve the timeframe to process program complaints, which was 
USDA | 2023 Agency Financial Report 195

published October 3, 2022. Additional guidance, Department Manual (DM) Program Complaint will 

be published once reviewed by the Department. 

Farm Service Agency, Market Facilitation Program - Interim Report, (03601-0003-31) (1)

FSA has improved processes for managing customer data by updating guidance and implementing new 

requirements to provide customers an opportunity to update information to be used in the Customer 

management data system. FSA continue to work with Stakeholders to update and revise Departmental 

Regulation (DR) 43370-001. 

CHALLENGE 3: Delivering Efficient Programs

USDA’s Compliance with Improper Payment Requirement for Fiscal Year 2022, 

(50024-0003-24) 

Farm Service Agency 

FSA submitted plans to the appropriate officials describing the actions FSA will take to bring the 

following programs into compliance: ARC/PLC, Livestock Forage Disaster Program (LFP) and ECP. 

FSA will continue to improve processes by providing additional employee training and understand 

trends and systemic issues occurring at the State and county levels.

Office of the Chief Financial Officer 

OCFO requested and was granted read-only access to the AFR platform to properly review all sections 

of AFR draft prior to Departmental review and publication. OCFO reviews of the draft ensured that 

reported information related to the Payment Integrity Information Act of 2019 (PIIA) was current and 

accurate. OCFO created and utilized a tracking sheet electronically to ensure that all documents were 

properly reviewed prior to the reporting of any information.

The current Risk Assessment Tracking Tool was enhanced to include additional spaces to track 

communication with programs regarding submission of the required deliverables. This additionally 

implemented a progressive communication protocol that ensured all stakeholders were aware of 

missed details.

USDA program responses to the Annual OMB Data Call will be reviewed to ensure accurate responses 

to prescribed questions. This will be done by requiring programs to complete the Data Call responses 

prior to the OMB deadline. 

Programs are required to submit the OMB Naming Convention responses to OCFO. OCFO reviewed 

and submitted the Naming Convention Data Call to the OMB MAX site. Prior to submission, OCFO 

reviewed the program responses and compared them to previously submitted program inventory 

deliverables. Any discrepancies between the two documents were discussed with the Agency Point of 

Contact and resolved prior to submission. 
196 Section III | Other Information

Commodity Credit Corporation, Commodity Credit Corporation’s Financial Statements 

for Fiscal Years 2022 and 2021, (06403-0005-11) 

FSA will review and update guidance and continue to monitor and improve internal controls over its 

financial system applications to ensure adequate security and protection of its financial information.

Natural Resources Conservation Service, Natural Resources Conservation Service’s 

Financial Statements for Fiscal Years 2022 and 2021, (10403-0005-11) 

NRCS plans to improve the Upward/Downward adjustments to FMMI by: 1) Identifying the 

documents that cause the invalid upward/downward adjustments, 2) Adding quality control steps for 

the adjustments to ensure the adjustments in FMMI is accurate and complete prior to posting, and 

3) Document the controls in a Standard Operating Procedures. 

Office of the Chief Financial Officer, USDA’s Consolidated Financial Statements for 

Fiscal Years 2021 and 2020, (50401-0020-11)

OCFO plans to complete the following actions to address this challenge and ensure appropriate agency 

officials obtain training pertaining to Departmental Regulation 2230-001, Reviews of Unliquidated 

Obligations: (1) offer training course to appropriate agency officials; and (2) document completion rates.

Natural Resources Conservation Service, Natural Resources Conservation Service’s 

Financial Statements for Fiscal Years 2021 and 2020, (10403-0004-11) 

NRCS is near completion with implementing procedures that enable management to completely and 

accurately accrue for expenditures that are incurred but not recorded as of period end and to revise and 

update guidance. 

Office of the Chief Information Officer, USDA’s Compliance with the Geospatial Data 

Act for Fiscal Year 2022, (50501-0026-12)

The OCIO Enterprise Data Management Center, Enterprise Geospatial Management Office (EGMO) 

developed and implemented a plan of action to collect, disseminate, and preserve geospatial data, 

developed an inventory tool to track and share Geospatial Data Act data across the Department, 

developed and implemented a scorecard used to track agency plans to ensure that relevant geospatial 

data, information, or products can be readily shared with other Federal agencies and non-Federal users, 

and developed catalog lifecycles used for priority data and products identified by the mission areas.

EGMO will continue to provide management oversight to ensure USDA agencies continue to execute 

the plan of action developed by EGMO on geospatial data and utilize the tools developed. 

EGMO developed a process to verify all approved National Geospatial Data Assets (NGDAs) use 

geospatial data standards, including metadata standards, developed and implemented AgLearn 

metadata training, procured geospatial tools (ArcGIS Pro) and made them available for data creators, 

developed Metadata Standards Departmental Manual which has been published, and documented 

metadata standards for all USDA NGDAs.
USDA | 2023 Agency Financial Report 197

EGMO will continue to provide management oversight to ensure agency compliance with the process 

to verify that all approved NGDAs use geospatial data standards, including metadata standards, ensure 

continuance of the AgLearn metadata training, ensure geospatial data creators have the necessary tools 

to perform effectively, and ensure the community of practice is aware of the published Metadata 

Standards Department Manual. This audit was satisfied September 13, 2023.

Farm Service Agency, 2017 Emergency Assistance for Honeybee Claims, (03702-0001-23) 

FSA published Handbook 1-Emergency Assistance for Livestock, Honeybees, and Farm-Raised Fish 

Program (ELAP), Amendment 13 on June 27, 2023, which outlines the internal control process for 

collecting District director reviews and monitoring State and National offices. A SharePoint site for 

gathering reviews has been developed to collect the results of reviews, allow monitoring, and provide 

an overall evaluation of program status. The handbook also provides specific guidance on how to 

report the results of the District director reviews to the State Executive Director and the information to 

be included in those reports. The standardized questionnaire has been developed.

FSA will explore implementing the reviews into its Internal Review Documentation and Tracking System.
198 Section III | Other Information

Payment Integrity

Over the past two decades, laws and regulations governing the identification and recovery of improper 

payments have evolved to improve payment accuracy and boost public confidence in Federal 

programs’ stewardship of taxpayer dollars. The Improper Payments Information Act of 2002 (IPIA), as 

amended and expanded by other laws, collectively required agencies to periodically review all 

programs and activities susceptible to significant improper payments, conduct payment recapture 

audits, and utilize Government-wide Do Not Pay (DNP) initiatives. In addition, IPIA had extensive 

reporting requirements. IPIA was repealed and replaced by the Improper Payment Elimination and 

Recovery Act of 2010, followed by the Improper Payment Elimination and Recovery Improvement 

Act of 2012 (IPERIA). 

In recent years, OMB transformed the improper payment compliance framework to create a more 

unified, comprehensive, and less burdensome set of requirements. IPERIA was repeated and replaced 

by the PIIA, which was passed on March 2, 2020. The PIIA modified and restructured existing 

improper payments laws to help agencies better identify and reduce any money wasted because of 

improper government payments. 

Not all improper payments are fraud, and not all improper payments represent a loss to the 

Government. Generally, an improper payment is any payment that should not have been made or of an 

incorrect amount under statutory, contractual, administrative, or other legally applicable requirements. 

Overview of USDA Programs

During FY 2023, USDA comprised 161 programs in eight mission areas providing leadership on food, 

agriculture, natural resources, rural development, and nutrition. A ninth mission area was dedicated to 

supporting the operational and administrative needs of the Department. Exhibit 17 provides further 

details on the alignment of USDA programs to the various mission areas. 
USDA | 2023 Agency Financial Report 199

Exhibit 17: Number USDA Programs by Mission Area

Mission Area / Agency # of Programs

Food, Nutrition, and Consumer Services (FNCS) 

Food and Nutrition Service (FNS) 17

Farm Production and Conservation (FPAC) 

Farm Service Agency (FSA), FPAC Business Center, Natural Resources Conservation Service 

(NRCS), and Risk Management Agency (RMA)

55

Food Safety (FS) 

Food Safety and Inspection Service (FSIS) 2

Marketing and Regulatory Programs (MRP) 

Agricultural Marketing Service (AMS) and Animal and Plant Health Inspection Service (APHIS) 8

Natural Resources and Environment (NRE) 

Forest Service (FS) 15

Rural Development (RD) 

Rural Business-Cooperative Service (RBCS), Rural Utility Service (RUS), and Rural Housing Service 

(RHS)

42

Research, Education, and Economics (REE) 

Agricultural Research Service (ARS) and National Institute of Food and Agriculture (NIFA) 7

Trade and Foreign Agricultural Affairs (TFAA) 

Foreign Agricultural Service (FAS) 2

Staff Offices (SO) 

Departmental Administration (DA), Office of Partnership and Public Engagement (OPPE), Office of 

the Secretary of the Assistant Secretary of Civil Rights (OASCR), Office of Budget and Program 

Analysis (OBPA), Office of the Chief Economist (OCE), Office of the Chief Financial Officer (OCFO), 

Office of the Chief Information Officer (OCIO), Office of the General Counsel (OGC), Office of 

Hearings and Appeals (OHA), and Office of Inspector General (OIG)

13

TOTAL USDA PROGRAMS 161

OMB identifies programs as either Phase 1 or Phase 2 based on the potential risk of improper 

payments. Phase 1 programs have annual outlays of over $10 million (M) and an improper payment 

rate that is below 1.5 percent. Phase 2 programs exceed the OMB threshold if the reported improper 

payment amount is above $10M and 1.5 percent of the program’s total annual outlays or above $100M 

regardless of the associated percentage of the program’s total annual outlays. 

Based on the OMB guidelines:

• 110 programs were categorized as Phase 1 programs;

• 13 programs were categorized as Phase 2; and

• 38 programs had outlays less than $10M.

During FY 2023, USDA had one program that was considered a High-Priority program: RMA FCIC. 

This was a reduction from FY 2022, when USDA had three High-Priority programs. OMB defines 

High-Priority programs as those with estimates of improper payments resulting in a monetary loss that 

exceeds $100M annually. Programs identified as High-Priority report quarterly through an OMBdriven reporting mechanism. The results of the quarterly scorecard can be found at 

www.paymentaccuracy.gov/payment-accuracy-high-priority-programs.
200 Section III | Other Information

Phase 1 Reporting

Programs identified as Phase 1 must perform a risk assessment every 3 years. In the interim years, 

should a program experience any significant legislative changes and/or significant increase in funding, 

a risk assessment may be done to determine if the program continues to be at low risk for making 

significant improper payments at or above the threshold levels set by OMB. 

In FY 2023, the Department conducted 58 risk assessments of programs in the following agencies: 

• Agricultural Research Services (ARS)

• Commodity Credit Corporation (CCC)

• Farm Service Agency (FSA)

• Food and Nutrition Service (FNS)

• Forest Service (FS)

• Foreign Agricultural Service (FAS)

• Natural Resources Conservation Service 

(NRCS)

• Rural Business-Cooperative Service 

(RBCS)

• Rural Development (RD)

• Rural Housing Service (RHS)

• Rural Utility Service (RUS)

• Staff Offices (SO)

After performing risk assessments for these programs, the Department determined none of its Phase 1 

programs in FY 2023 were risk-susceptible to making significant improper payments at or above the 

threshold levels set by OMB. Of the 58 risk assessments completed, 10 were for programs reporting 

outlays under $10M that opted to complete a risk assessment to ensure proper functionality of internal 

controls. Lastly, due to an Office of Inspector General FY 2022 finding regarding incomplete risk 

assessments, the Staff Office-OCIO completed a risk assessment. 

For all other programs with outlays less than $10M or categorized as Phase 1, a management 

certification was completed. The management certification requires the program to attest to whether 

material changes occurred since the last risk assessment. Should the program indicate a material 

change to the program, OCFO meets with program personnel to better understand the changes and 

what controls have been implemented to mitigate risk associated with improper payments. Depending 

on the outcome of that meeting, the program may be required to complete an off-cycle risk assessment 

the next fiscal year. During FY 2023, no programs experienced material changes that warranted an offcycle risk assessment. 
USDA | 2023 Agency Financial Report 201

Phase 2 Reporting

Annually, programs provide in-depth payment integrity information to OMB for publication via an 

OMB-designed reporting tool. The data are collected and subsequently published on 

www.paymentaccuracy.gov to fulfill multiple statutory reporting requirements. 

In addition to the reporting requirements outlined in OMB CircularA-123, Appendix C (M-21-19), 

OMB Circular A-136, Financial Reporting Requirements, programs identified as High-Priority must 

provide further information regarding their actions related to improper payments. This information 

includes an explanation of the description of improper payments made, an estimate of the improper 

payment amount and rate, an explanation of the causes of improper payments, and any major actions 

taken or planned to mitigate those causes. This reporting requirement was optional for programs 

identified as Phase 2; USDA requested that all Phase 2 programs submit a narrative response to be 

included in the FY 2023 AFR. 

The below chart summarizes the 13 Phase 2 programs and provides a brief description of each of the 

programs:

Exhibit 18: USDA Phase 2 Programs and Descriptions

USDA 

Agency

Phase 2

Program Name Program Description

FNS

Supplemental 

Nutrition Assistance 

Program (SNAP)

SNAP provides food benefits to low-income families to supplement their 

grocery budgets so they can afford the nutritious food essential to health and 

well-being.

FNS

National School 

Lunch Program 

(NSLP)

NSLP is a federally assisted meal program operating in public and nonprofit 

private schools and residential childcare institutions. It provides nutritionally 

balanced and low-cost or free lunches to children each school day. The 

program was established under the National School Lunch Act, signed by 

President Harry Truman in 1946.

FNS School Breakfast 

Program (SBP)

The SBP provides reimbursement to states to operate nonprofit breakfast 

programs in schools and residential childcare institutions. The Food and 

Nutrition Service administers the SBP at the Federal level, state education 

agencies administer the SBP at the state level, and local school food 

authorities operate the program in schools.

FNS Women, Infants & 

Children (WIC)

The Special Supplemental Nutrition Program for WIC provides Federal 

grants to states for supplemental foods, healthcare referrals, and nutrition 

education for low-income pregnant, breastfeeding, and non-breastfeeding 

postpartum women, and to infants and children up to age 5 who are found to 

be at nutritional risk.
202 Section III | Other Information

USDA 

Agency

Phase 2

Program Name Program Description

FNS

Child & Adult Care 

Food Program 

(CACFP) Family Day 

Care Home (FDCH) 

Component

The CACFP is a Federal program that provides reimbursements for nutritious 

meals and snacks to eligible children and adults who are enrolled for care at 

participating childcare centers, daycare homes, and adult daycare centers. 

CACFP also provides reimbursements for meals served to children and 

youth participating in after-school care programs, children residing in 

emergency shelters, and adults over the age of 60 or living with a disability 

and enrolled in daycare facilities. CACFP contributes to the wellness, healthy 

growth, and development of young children and adults in the United States.

FNS

Summer Food 

Service Program 

(SFSP)

The SFSP is a federally funded, state-administered program. USDA 

reimburses program operators who serve no-cost, healthy meals and snacks 

to children and teens. Meals are served at summer sites in low-income 

communities, where sponsors often also offer enrichment activities, or—in 

approved rural communities facing access issues—may be provided via 

grab-n-go or delivery.

CCC

Agriculture Risk 

Coverage (ARC) & 

Price Loss Coverage 

(PLC)

The ARC and PLC programs provide financial protections to farmers from 

substantial drops in crop prices or revenues and are vital economic safety 

nets for most American farms.

FSA

Livestock Forage 

Disaster Program 

(LFP)

The LFP provides payments to eligible livestock owners and contract 

growers who have covered livestock and who are also producers of grazed 

forage crop acreage (native and improved pastureland with permanent 

vegetative cover, or certain crops planted specifically for grazing) that have 

suffered a loss of grazed forage due to a qualifying drought during the 

normal grazing period for the county.

FSA

Noninsured 

Assistance Program 

(NAP)

NAP provides financial assistance to producers of non-insurable crops when 

low yields, loss of inventory, or prevented planting occur due to natural 

disasters.

FSA

Coronavirus Food 

Assistance Program 

(CFAP)

CFAP was implemented for producers of agricultural commodities marketed 

in 2020 that faced market disruptions due to COVID-19. This was part of a 

larger initiative to improve USDA pandemic assistance to producers.

FSA

Wildfires & 

Hurricanes 

Indemnity Program 

Plus (WHIP+)

WHIP+ provides assistance to eligible producers who suffered losses to 

crops, trees, bushes, and vines. Payments are based on several factors, 

including the expected value of the crop, the crop that was actually 

harvested, and crop insurance coverage and payments, among others.

FSA

Emergency 

Conservation 

Program-Disasters 

(ECP-Disasters)

ECP-Disasters helps farmers and ranchers repair damage to farmlands 

caused by natural disasters and put in place methods for water conservation 

during severe drought.

RMA

Federal Crop 

Insurance 

Corporation Program 

Fund (FCIC)*

The FCIC Program Fund is a wholly owned government corporation that 

administers the Federal crop insurance program. FCIC promotes the 

economic stability of agriculture through a sound system of crop insurance 

and provides the means for the research and experience helpful in devising 

and establishing such insurance.

*For FY 2023, FCIC is reporting as a High-Priority Program
USDA | 2023 Agency Financial Report 203

Phase 2 Program Summaries of Payment Integrity 

Activities, Results, and Mitigation Strategies

FNS Supplemental Nutrition Assistance Program (SNAP)

The SNAP improper payment rate for FY 2022, nationally, is estimated to be 11.54 percent, including 

over-issuances and under-issuances. Out of a total regular annual issuance of $75,987,537,654, 

overpayments are projected to be approximately $7,477,944,757 while underpayments are projected to 

be $1,295,123,286. It should be noted, USDA FNS had not announced a SNAP payment error rate 

since FY 2019. COVID-19 flexibilities provided by Congress allowed State agencies the ability to 

suspend Quality Control (QC) reviews for FY 2020 and FY 2021, which impacted the quality and 

completeness of QC data during those years.2 As a result, FNS was unable to establish National and 

State level payment error rates for FYs 2020 and 2021. FY 2022 is therefore the first year FNS 

reported payment error rates since the COVID-19 pandemic began.

The following narrative describes how SNAP’s corrective actions were specifically tailored to better 

reflect the unique processes, procedures, and risks involved in the program. The system operates 

through a regulatory defined valid statistical sample of cases that are pulled and reviewed using a twotier system. An overview is described online at SNAP Quality Control | Food and Nutrition Service 

(USDA.gov).

Results of the case reviews are entered into SNAP’s QC system, which FNS uses to conduct a root 

cause analysis to identify the primary causes of errors at the National and State level. At the National 

level, the leading factors that contribute to more than 60 percent of all errors nationwide are: (1) wage 

and salary errors; (2) reporting system errors; and (3) household composition errors. FNS targets 

technical assistance at the Federal level to hold States accountable for implementing corrective action 

plans specifically tailored to preventing these errors. FNS requires States to provide regular progress 

reporting and uses State-reported QC data to measure the impact of corrective actions. Corrective 

action plans remain open until all activities are completed and validated. 

FNS also establishes Federal-level corrective actions tailored to support State payment accuracy 

efforts. FNS identifies activities based on a sub-root cause analysis and uses a data-driven approach to 

target resources to States based on risk. The sub-root cause analysis further assesses the specific factors 

leading to errors. For example, wage and salary errors occur due to households failing to report 

information and State agencies failing to act on or properly verify income information. FNS identifies 

Federal-level corrective actions to assist States with improving household reporting and working with 

States to increase how effectively they act on or verify information. This assistance ensures that 

corrective actions are tailored to specific and unique causes. 

2 FNS initially provided QC flexibility under a Families First Coronavirus Response Act waiver for March, April, and May 2020. Section 

4603(a)(2) of the Continuing Appropriations Act 2021 and Other Extensions Act then allowed QC flexibility through September 2021. 

However, the Consolidated Appropriations Act 2021 changed the end date for QC flexibility to June 30, 2021.
204 Section III | Other Information

The Food and Nutrition Act of 2008, as amended, establishes authority for FNS to collect overissuances and provide restitution to households for under-issuances. FNS promulgated regulations at 

7 CFR 273.18 governing claims collection. FNS also assists SNAP State agencies using the Treasury 

Offset Program to collect unpaid claims.

The following are corrective actions FNS has and continues to implement at the Federal level to 

address national root causes of error: 

Exhibit 19: FNS SNAP Key Actions to Address Root Causes of Errors

Key Actions at the Federal Level to Address National Root Causes of Error in the SNAP Program

Mitigation Strategy or

Corrective Action Description and Impact

Income Verification Pilot

In December 2020, Congress provided FNS with funding 

intended to improve States’ ability to verify household earnings 

via third-party income databases. FNS issued grants to State 

agencies to support these efforts in FY 2021 and 2022. This 

project helps FNS support State agencies in improving wage and 

salary information, recognizing that this is a long-standing driver 

of payment errors.

End of Public Health Emergency (PHE) 

Training For All States

FNS provided and continues to provide technical assistance to 

State agencies in the form of trainings, guidance memos, and 

roundtable discussions that cover a range of topics to help States 

manage the end of the PHE. These efforts support State 

agencies in ensuring program integrity as they return to normal 

program rules after COVID-related flexibilities and waivers end. 

For example, FNS is providing trainings and guidance (1) on reimplementing key certification actions and conducting QC reviews 

and (2) clarifying the sunset of waivers and other PHE-related 

administrative flexibilities. FNS will also facilitate discussions with 

State leaders to gather information on obstacles to a successful 

transition and ideas for how FNS can support them.

Root Cause Analysis and Correct Action 

Discussion with Leaders

FNS conducted two training events for State SNAP managers in 

QC, policy, and corrective action planning. The training focused 

on how to identify the root causes of errors using already 

available SNAP data and FNS tools, and policy and program 

changes a State may consider when designing meaningful 

corrective action plans. Finally, several States shared their own 

experiences conducting this type of analysis to improve payment 

accuracy. These critical conversations were designed to help 

States better understand how to develop effective and targeted 

corrective actions that in turn improve program performance.
USDA | 2023 Agency Financial Report 205

The following are corrective actions FNS will implement at the Federal level by the end of FY 2023 to 

address the national sub-root causes of error:

Exhibit 20: FNS SNAP Key Actions to Address Sub-Root Causes of Errors

Key Actions at the Federal Level to Address National Sub-Root Causes of Error in the SNAP Program

Mitigation Strategy or

Corrective Action Description and Impact

Contract to Support States

In May 2023, FNS awarded a contract to provide technical assistance 

resources for States to assist them in improving payment accuracy. Under 

this contract, FNS will: host listening sessions with States to encourage peerto-peer information sharing and to gather information on challenges and 

opportunities in improving payment accuracy, update existing guidance for 

States on payment accuracy best practices, and provide training for States 

and FNS staff on the updated guidance. Moving forward, FNS plans to use 

the resources developed by the contractor in providing technical assistance 

to States on improving payment accuracy. 

Nationwide Earnings

Verification Services

On September 30, 2023, FNS awarded a five-year contract to two vendors, 

Equifax and Experian, for the SNAP EVS. The SNAP EVS provides State 

agencies with access to two commercial databases of employment and 

earnings records. State agencies administering SNAP can use the SNAP 

EVS to verify earned income sources and amounts for SNAP applicants 

and recipients.

FNS National School Lunch Program (NSLP) and School Breakfast Program 

(SBP)

FNS estimates improper payments via the Access, Participation, Eligibility, and Certification (APEC) 

study series. The agency conducts these studies every 5 years. In between study years, FNS uses 

administrative data to “age” the study estimates. Schools served all meals for free throughout School 

Years (SY) 2020–2021 and 2021–2022.3 As a result, data that would normally enter into FNS’ statistical 

aging model does not exist for FY 2022, and FNS used the unadjusted errors from APEC III to estimate 

improper payments4. FNS estimates improper payments for FY 22 of $546.36 million in NSLP, and 

$194.4 million in SBP, equating to error rates of 2.38% for NSLP and 2.99% for SBP, respectively. 

3

In school year 2020–2021, schools had the option of serving all meals for free through the Summer Food Service Program or the 

NSLP’s Seamless Summer Option (SSO); see USDA policy memo, COVID–19: Child Nutrition Response #59. In school year 2021–2022, 

schools could continue serving meals for free under the SSO; see policy memo, COVID–19: Child Nutrition Response #85.

4 Because schools served all meals for free through the end of school year 2021–2022, certification error was zero through the first 

three quarters of FY 2022.
206 Section III | Other Information

FNS has determined two root causes that have resulted in improper payments in the school meals 

programs:

• Certification Error: This occurs when a student is certified at the incorrect reimbursement level, 

e.g., at the higher free level instead of reduced-price (which results in an overpayment) or at the 

lower paid or reduced-price levels instead of free (which results in an underpayment).

• Aggregation Error: This occurs when, in the process of reimbursements, the incorrect meal counts 

are recorded or transmitted from schools to school food authorities (SFAs), from SFAs to State 

agencies (SAs), or from SAs to FNS. 

During FY 2023, FNS undertook and planned the following activities to mitigate NSLP/SBP improper 

payments:

Exhibit 21: FNS NSLP and SBP Key Actions to Address Root Causes of Errors

Key Actions During FY 2023 to Address Improper Payments in NSLP/SBP Programs

Mitigation Strategy or 

Corrective Action Description and Impact

Internal Process/Policy 

Change FNS published the Child Nutrition Programs: Community Eligibility ProvisionIncreasing Options for Schools Proposed Rule on March 23, 2023. This 

rulemaking proposes to lower CEP’s minimum identified student percentage 

(ISP) from 40 to 25 percent to increase program reach.

Automation: Direct 

Certification with Medicaid On July 1, 2023, FNS announced 13 new states will begin participating in the 

Direct Certification with Medicaid Demonstration Project for SY 2023–2024. 

The total number of states participating in the demonstration project will now 

be 38.

Automation: Non-Competitive 

Technology Innovation Grants 

(nTIGs) In FY 2021, FNS released $50M in nTIG funds for Child Nutrition State 

agencies to improve IT systems. FNS continues to work with grant recipients 

using funds to develop, improve, and maintain Child Nutrition IT systems.

Training: National Webinars FNS held Administrative Review (AR) webinars for State agency staff 

providing learning materials on how to complete an AR including timeline and 

resources needed when conducting an AR (e.g., oversight of eligibility, 

claiming and meal pattern).
USDA | 2023 Agency Financial Report 207

FNS Women, Infants, and Children (WIC)

Estimates of improper payment rates in WIC are calculated using two types of errors: (1) improper 

certification of participants (certification case error) and (2) incorrect payments to retail vendors 

(vendor errors). FNS makes use of periodic studies to assess the level of error in program payments 

and then “ages” the data to produce updated estimates for each reporting year for both certification 

case errors and vendor errors. FNS estimates improper payment amount to be $64.21M with a 

1.79 percent improper payment rate.

FNS has determined two root causes that have resulted in improper payments:

• Certification Case Error: WIC sampling is accomplished by asking respondents to show the 

documents/proofs they presented when initially gaining eligibility for the program. The proofs 

must meet standards set by FNS through Federal regulation and/or by State agency policy. From 

the certification interviews, the eligibility of each WIC participant is determined to be either 

proper or improper, resulting in a case error for improper results. Those case errors are then 

translated to dollar error amounts based on actual redemption data, and then reported as IPs. 

• Vendor Error: WIC samples vendor overcharge errors by comparing the best purchase price 

obtained by the compliance buyer to the redeemed dollar amount. The actual dollar amount 

overcharged is also calculated using price and redemption information. For each record with an 

overcharge, amounts paid are compared to the Maximum Allowable Reimbursement (MAR) and 

Not-to-Exceed (NTE) values provided by the State agency. If the amount paid exceeds the MAR 

or NTE, then the lesser amount is used to calculate the overcharge. Similar to the certification case 

error, vendor overcharge amounts are reported as overpayments outside of agency control. 

FNS continues to take proactive measures to help WIC State agencies reduce improper payments. FNS 

uses management evaluations (MEs) as its primary oversight tool. FNS analyzes ME data on an 

ongoing basis to identify opportunities to improve program administration and integrity. This includes 

addressing certification and vendor issues that could result in improper payments and working with 

State agencies to address these issues through corrective actions or by providing technical assistance.

In May 2023, FNS released a memorandum for State agencies to streamline and identify opportunities 

to simplify WIC certification process and is currently updating the WIC Vendor Management and Food 

Delivery Handbook to include new resources to support WIC State agencies in their vendor oversight 

and integrity activities.

FNS has not made any changes in payment integrity methodologies activities during the FY 2023 

reporting period.
208 Section III | Other Information

FNS Child and Adult Care Food Program (CACFP) Family Day Care Home 

(FDCH) Component

CACFP is a Federal program providing reimbursements for nutritious meals and snacks to eligible 

children and adults who are enrolled for care at participating childcare centers, day care homes, and 

adult day care centers. CACFP also provides reimbursements for meals served to children and youth 

participating in after-school care programs, children residing in emergency shelters, and adults over the 

age of 60 or living with a disability and enrolled in day care facilities. CACFP contributes to the 

wellness, healthy growth, and development of young children and adults in the United States.

CACFP has three distinct parts: Child Care Centers, Adult Day Care facilities, and FDCHs. The 

improper payment measures currently do not include improper payments associated with the Adult 

Day Care component or Child Care Centers.

FDCH sponsoring organizations are responsible for classifying each of the homes under their 

sponsorship as eligible for either Tier I or Tier II reimbursement. FDCH sponsors may determine the 

tiering status of participating FDCHs using elementary school data, census data, or the provider’s 

documented household income. FDCHs qualify for the higher Tier I reimbursement rates based on 

their location within low-income areas or the low-income status of the provider. All other FDCHs, 

referred to as Tier II FDCHs, are reimbursed at lower rates; however, they may still receive the Tier I 

higher reimbursement rates for meals served to children from families with incomes at or below 185 

percent of the poverty level as long as the individual child’s eligibility is documented and recorded.

FDCHs report meals and snacks served to enrolled children to their sponsors. Sponsors then submit 

meal claims to their State agencies, which, in turn, submit aggregated meal claims to the USDA FNS. 

FNS, through State agencies, then reimburses sponsors for all meals and snacks served that meet 

Federal guidelines and sponsors reimburse the FDCHs.

FNS estimates error in FDCH reimbursement levels through periodic sample-based studies. Studies 

assess whether day care homes are assigned to the correct reimbursement tier. In years between studies, 

FNS updates the most recent study’s sample-based estimate with administrative data. For FY 2022, FNS 

is reporting no tiering error.5 FNS anticipates reporting on tiering error again for FY 20236.

5 An April 2021 FNS policy memo, COVID-19: Child Nutrition Response #93 allowed all day care homes, regardless of location, to claim 

all meals and snacks at the Tier 1 reimbursement rate, effectively removing tiering error while the waiver was in place. The waiver 

expired June 30, 2022. The Keep Kids Fed Act of 2022 (KKFA, P.L. 117-158) increased the reimbursement of Tier II family or group day 

care homes to Tier I amounts for the 2022–2023 school year (July 1, 2022, through June 30, 2023). The combination of the 

administrative waiver and the KKFA provision had the effect of reducing tiering error to zero for all of fiscal year 2022 and will reduce 

tiering error to zero for the first 9 months of fiscal year 2023.

6 The 2009 CACFP Improper Payments Data Collection Pilot Project explored the feasibility of using parent recall data on specific meals 

(breakfast, morning snack, lunch, afternoon snack, supper, evening snack) to estimate erroneous meal claims. The 2020 CACFP Family 

Day Care Homes Meal Claims Feasibility Study explored additional methods of measuring the number of meals claimed for 

reimbursement. Due to study limitations, in particular low participation and response rates from providers and parents, the 2020 study 

findings were not generalizable and USDA concluded this approach for data collection was not feasible.
USDA | 2023 Agency Financial Report 209

FNS continues to explore methodologies to assess error in the number of meals claimed by FDCHs. 

The agency’s most recent effort7 collected State Monitoring Reports that contain the findings from 

State reviews of sponsors’ meal claims for each of their FDCHs, including errors associated with meal 

claiming. The study is assessing whether these findings, along with the meal claim reimbursements 

submitted by each State to FNS, can be used to estimate improper payments.

While the current sampling plan focuses on FDCHs, work is ongoing to expand improper payment 

measures to include childcare centers and sponsors through a comprehensive measure of erroneous 

payments via the Erroneous Payments in CACFP Centers Study (EPICCS). EPICCS builds on the 

methods developed for school meals in the APEC study series. The agency expects to release EPICCS 

results in 2024.

During FY 2023, FNS identified three root causes that resulted in improper payments. The root cause 

and the activities to mitigate their impact are:

Exhibit 22: FNS CACFP FDCH Component Key Actions to Address Root Causes of Errors

Key Actions During FY 2023 to Address Improper Payments

CACFP and FDCH Programs

Root Cause Description of Mitigation Efforts

Internal Process/Policy 

Change Applicable for FY 2023, FNS issued a policy memo to States, “Area Eligibility 

for Summer 2022 and School Year 2022–23,” providing guidance on 

determining CACFP eligibility when school data are unavailable. Family Day 

Care Homes use school or census data to establish geographic eligibility.

Automation

In FY 2021, FNS released $50M in non-competitive Technology Innovation 

Grant (nTIG) funds for Child Nutrition (CN) State agencies to improve IT 

systems. Throughout FY 2022 and FY 2023, FNS continued to work with the 

nTIG grant recipients who are using funds to develop, improve, and maintain 

CN IT systems through virtual and in-person technical assistance. FNS will be 

releasing additional nTIG funding in FY 2023 to ensure that State agencies are 

able to continue to develop and improve their CN IT systems. FNS expects 

that the overall improvement of IT systems by nTIG recipients administering 

CACFP will improve the State agencies’ ability to train, monitor, provide 

technical assistance, and take corrective actions with CACFP sponsors.

Monitoring

FNS Regional Offices are completing three MEs per region, each of which 

also includes a local-level review where FNS staff accompany State 

agencies on reviews of operators. MEs provide a periodic assessment of 

State agency operations and administration and can result in a report of 

findings, which require the State agency to correct any problems. This helps 

to ensure that State agencies are properly monitoring certification and meal 

counting at the local level and are working with local operators to reduce 

improper payments.

7 FNS anticipates completing this study, tentatively named the “CACFP Meal Claiming Error Methods Study,” in FY 2024.
210 Section III | Other Information

FNS: Summer Food Service Program (SFSP)

SFSP is a USDA FNS-funded State-administered program that provides free meals and snacks to 

children in low-income areas when school is not in session. At the local level, SFSP is administered by 

State-approved sponsoring organizations. These organizations manage one or more sites that are 

located in a variety of settings, including schools, parks, community centers, libraries, farmers’ 

markets, apartment complexes, churches, and migrant centers. Many sites offer enrichment 

opportunities for children, such as reading, physical activity, or nutrition education.

FNS issues program funds to State agencies, which then pass the funds to SFSP sponsoring 

organizations to run the program. Sponsoring organizations use that money to cover both the food and 

administrative costs of the program.

Federal payments require a simple “meals times rate” computation. SFSP sponsoring organizations 

submit meal counts to their State agencies once per month. Those meal counts are multiplied by one of 

two SFSP rates. Meals prepared on-site or meals served by sites located in rural areas receive a higher 

reimbursement rate from FNS, whereas meals prepared by vendors and served at sites in non-rural 

areas receive a lower rate. Both the self-prep/rural and vended/urban rates are designed to cover food 

and administrative costs.

FNS is currently engaged in efforts to develop an improper payment estimate for SFSP in accordance 

with a Sampling and Estimation Methodology Plan for approval by OMB. FNS will collect data over a 

5-year period that began in the summer of 2023.

Data collection was originally scheduled to begin in the summer of 2020. However, states operated 

SFSP in the summers of 2021 and 2022 under a series of FNS-authorized pandemic waivers that 

significantly altered SFSP program rules. FNS elected to postpone data collection until those waivers 

expired. Program waivers during the COVID-19 emergency allowed SFSP to operate outside of 

summer months, modified congregate feeding requirements, allowed for parent/guardian meal pick-up, 

and provided flexibility in determining site eligibility. 
USDA | 2023 Agency Financial Report 211

During FY 2023, FNS undertook and planned the following activities to mitigate SFSP improper 

payments:

Exhibit 23: FNS SFSP Key Actions to Address Root Causes of Errors

Key Actions During FY 2023 to Address Improper Payments in SFSP Programs

Root Cause Description of Mitigation Efforts

Training: State Agencies State agencies must offer training to sponsors each year prior to the annual 

sponsor application period. The training covers the sponsoring organization’s 

responsibilities and the site supervisor’s responsibilities. Every sponsoring 

organization must send key staff members (including directors) to that State 

agency training in order to be eligible to participate in the program.

Training: Sponsor 

Administrative Staff

Training for administrative staff includes:

• Purpose of the program

• Site eligibility and visit requirements

• Recordkeeping requirements

• Meal requirements

• Reporting procedures

Training: Sponsors' Site 

Monitors

Training for site monitors include: 

• Overview of sites for which they are responsible

• Conducting site visits and reviews

• Monitoring schedules

• Reporting

• Recordkeeping procedures

Training: Site Staff

Training for site staff include: 

• Purpose of the program

• Site eligibility

• Recordkeeping requirements, such as meal counts, delivery receipts, 

daily forms, daily labor, and meal service forms

• Adjustments to meals, such as delivered meals, preparation, and 

inventory procedures

Monitoring

FNS Regional Offices are also completing three MEs per region, each of 

which also includes a local-level review where FNS staff accompany State 

agencies on reviews of local operators. MEs provide a periodic assessment 

of State agency operations and administration and can result in a report of 

findings that require the State agency to correct any problems. This helps to 

ensure that State agencies are properly monitoring meal claims at the local 

level and are working with local operators to reduce any improper payments.
212 Section III | Other Information

CCC Agriculture Risk Coverage and Price Loss Coverage (ARC/PLC) 

The FY 2023 estimated improper payment amount for ARC/PLC is $189.13M and the estimated 

improper payment error rate is 8.60 percent. Improper payments were due to the County Office official 

not following the well documented program requirements on all findings. To address Acreage 

Reporting issues, the Deputy Administrator for Farm Programs (DAFP) has created a task force to 

develop recommendations to inform a timeline of adoption. The team will review policies and software 

enhancements to identify possible changes that would mitigate risks associated with improper 

payments. In addition, FSA provided National Payment Eligibility and Payment Limitation training at 

a joint training session. Finally, to reduce the occurrence of overall errors, an ARC/PLC sign-up 

checklist has been created as a resource for county office employees. 

There have been no changes in payment integrity methodologies, activities, or results that occurred 

during this reporting period.

FSA Livestock Forage Disaster Program (LFP)

The FY 2023 estimated improper payment amount for LFP is $168.55M and the estimated improper 

payment error rate is 13.66 percent. The causes of improper payments were the County Office Official 

not following well documented program requirements of having a written lease or completed CCC-855 

(Annual Lease Agreement Certification Statement) for the associated acreage; late filed acreage 

reporting policy according to 2-CP; and not having required eligibility documents on file prior to 

payment. Also, County Office staff did not adhere to first-level controls to prevent improper payments 

to ensure the correct carrying capacity is used for the specific forage and pasture type.

FSA conducts monthly training for State Livestock Program Specialists that focuses on issues 

identified in Payment Integrity Information Act testing. In addition, National Payment Eligibility and 

Payment Limitation training was provided at the National Training session. Also, Deputy 

Administrator for Farm Programs (DAFP) has created a task force that will meet to discuss issues. 

One of the primary objectives of this task force is to address improper payment findings related to the 

acreage reporting process. The task force will develop proposed solutions and training materials. 

Furthermore, FSA will conduct a meeting with the purpose of identifying LFP software enhancements 

that can assure the proper completion of the CCC-855 or that written lease requirements are met. 

Moreover, District Directors are required to review the first five LFP applications received in the 

Service Center. FSA implemented a SharePoint system in FY 2023 for those reviews to be documented 

and to report any identified program weaknesses to the National Office. Finally, FSA will continue to 

request the prioritization of LFP software enhancements that will eliminate the manual entry of 

carrying capacities by interfacing the application system with the National Crop Table.

There have been no changes in payment integrity methodologies, activities, or results that occurred 

during this reporting period.
USDA | 2023 Agency Financial Report 213

FSA Noninsured Crop Disaster Assistance Program (NAP)

The FY 2023 estimated improper payment amount for NAP is $25.1M and the estimated improper 

payment error rate is 10.46 percent. The causes of improper payments were:

• Fees were not collected or a register was not established for late filed acreage reports.

• The incorrect number of acres/colonies/taps and incorrect production were used to calculate a 

payment.

• An incorrect Animal Unit Day (AUD) loss factor was entered in the Grazing Worksheet.

Training will be conducted to address incorrect grazing acreage and production accounting errors, 

specifically to accurately convert animal units into payment acres in the Grass for Grazing worksheet. 

This manual process has been identified as a future software enhancement to automate the process 

preventing many of these specific data entry errors. The NAP Team meets with State Office Specialists 

monthly to provide ongoing training and address outstanding questions. These meetings are recorded 

and posted to the NAP Training Page. In addition, the NAP CCC-770 checklist will be updated to 

address these specific findings. To address Acreage Reporting issues, DAFP has created a task force. 

One of the primary topics is to address improper payment findings related to the acreage reporting 

process. The task force will also develop proposed solutions and training materials.

The underpayment findings are related to data entry errors and failure to access data. Specific training 

will be conducted to instruct on accurately converting animal units to payment acres in the Grass for 

Grazing worksheet. In addition, several software enhancements have been identified for the NAP 

program that will directly reduce improper payment findings.

There have been no changes in payment integrity methodologies, activities, or results that occurred 

during this reporting period.

FSA Coronavirus Food Assistance Program (CFAP) 

The FY 2023 estimated improper payment amount for CFAP is $35.9M and the estimated improper 

payment error rate is 6.65 percent. Improper payments were due to program requirements of 

completing re-delegation of authority to the County Executive Director, obtaining approval signatures, 

and collecting payment eligibility documentation, and to entering incorrect values in the system based 

on the producer’s certification or County Committee adjustment.

FSA will include and emphasize the approval authority process and policies, including delegations of 

authority, for all current and future ad hoc programs. The approval authority process will be a segment 

of the overall program training and included in the program policy notices and procedures. In addition, 

National Payment Eligibility and Payment Limitation training was provided at the National Training 

session. The training focused on findings associated with all program areas. The additional training and 

emphasis on delegation of authority will provide guidance to field office employees in completing this 

significant program requirement. Finally, FSA will conduct CFAP spot checks to ensure manual entries 

are correctly entered in the application software.
214 Section III | Other Information

There have been no changes in payment integrity methodologies, activities, or results that occurred 

during this reporting period.

FSA Wildfires and Hurricanes Indemnity Program Plus (WHIP+)

The FY 2023 estimated improper payment amount for WHIP+ is $15.94M and the estimated improper 

payment error rate is 8.34 percent. Improper payments were due to incorrect values entered into 

software (data entry errors), acreage reports not on file or signed for the affected crops, and data used 

not matching RMA data.

The WHIP+ program has been closed and funding has expired. Corrections have been applied to 

succeeding ad hoc disaster programs. The Safety Net Division (SND) reduced the requirement for 

manual data entry by field office users in succeeding ad hoc disaster programs. This was done by 

utilizing integrated software systems to allow dropdown options and pre-populated fields. FSA has also 

taken additional steps to enhance data sharing with other agencies to utilize existing data provided by 

producers and reduce the need for county office employees to load values. Data entry and data integrity 

were and still are being addressed during monthly calls with field offices. In addition, SND increased 

cooperation with RMA for succeeding ad hoc disaster programs by streamlining the application 

process using existing payment calculations provided by RMA that were used to provide autopopulated applications for payment to producers.

There have been no changes in payment integrity methodologies, activities, or results that occurred 

during this reporting period.

FSA Emergency Conservation Program-Disasters (ECP-Disasters)

The FY 2023 estimated improper payment amount for ECP-Disasters is $34.37M and the estimated 

improper payment error rate is 40.41 percent. The causes of improper payments were: 

• Prepared and dated FSA-23 (Determining Agricultural Market Value and Cost Share Per Acre 

Worksheet) were not on file before Cost-Share approval.

• Revised FSA-848A (Cost-Share Agreement) were not signed by the participant before payment 

was issued.

• Eligible cost of practice or component was calculated incorrectly.

A revised CCC-770 checklist has been developed to capture District Director participation in the review 

process during approval, payment, and lifespan of the practice. This will allow the District Directors to 

ensure and verify that the FSA-23 approval is completed before the cost share agreement is approved and 

allow them to ensure and verify that the FSA-848-A is signed by FSA and the participant before the 

payment is issued. Secondly, FSA is also in the process of Incorporating ECP into the Internal Review 

Document Tracking System to track actions. Finally, FSA has developed new ECP payment scenarios 

that eliminates the County Office requirement to compute cost share items considered eligible.

There have been no changes in payment integrity methodologies, activities, or results that occurred 

during this reporting period.
USDA | 2023 Agency Financial Report 215

Phase 2 High-Priority Program Summaries of Payment 

Integrity Activities, Results, and Mitigation Strategies 

RMA: Federal Crop Insurance Corporation Program Fund (FCIC)

For FY 2023, RMA reported an estimated error rate of 2.64 percent and improper dollars totaling 

$369.82M. There were two main root causes of the reported improper dollars: 

• Failure to access data/information

• Inability to access data/information

The improper dollars associated with failure to access data/information resulted from situations in 

which the data/information existed, were obtained, and were used in the payment calculation; however, 

an administrative error or calculation error caused the proper payment to become improper. RMA has 

addressed improper payments for these types of errors in many different ways, including, but not 

limited to, assessing the quality control processes of AIPs through AIP Performance Reviews, 

conducting program reviews, and issuing Manager’s Bulletins. Based on the results of the FY 2023 

IPERIA reviews, RMA is currently conducting a program review focused on unit structure as a means 

of reducing improper payments under this root cause. 

A majority of improper dollars associated with inability to access data/information are the result of 

certification errors. The Federal crop insurance program requires participants to certify a variety of 

information used to establish the amount of insurance on a policy and total premium. Errors in 

certifications can lead to improper payments. RMA has, and continues to, conduct results analysis in 

order to identify ways to reduce improper payments in this area. Some of the steps taken include, but 

are not limited to, updating current policies and procedures, issuing informational memorandums and 

Manager’s Bulletins, and conducting program reviews. For FY 2023, RMA intends to issue an 

Informational Memorandum addressing certification errors related to acreage reporting.

Results data can be found in RMA’s Compliance Activities and Results Systems (CARS). CARS is a 

Microsoft Dynamic Customer Relationship Management (CRM) application that supports case 

management and date collection.

RMA did not have any changes in payment integrity methodologies, activities, or results that occurred 

during the reporting period.
216 Section III | Other Information

Do Not Pay (DNP)

USDA continues to utilize DNP in its efforts to mitigate improper payments. USDA programs 

currently using DNP utilize the Working System (the “Portal”) throughout the payment life cycle. 

All programs utilize the Portal during the pre-award step, most utilize pre-award and pre-payment, and 

a few programs utilize pre-award, pre-payment, and post-payment. 

The end of the various COVID-19-related assistance programs, which broadened USDA programs in a 

variety of ways, including amount of funding available and eligibility requirements, resulted in USDA 

DNP search activities returning to pre-pandemic levels. During FY 2023, the number of DNP search 

activities decreased by nearly 95 percent (from 118,064 to 5,068); however, the total dollar amount 

matched from those search activities only decreased by approximately 16 percent (from $13.95M to 

$11.68M). 

USDA has increased its active users by approximately 5 percent, from 1,780 in FY 2022 to 1,869 in FY 

2023. These users span five agencies and multiple programs. USDA consistently increases the number 

of active users by at least 3 percent each fiscal year. 
USDA | 2023 Agency Financial Report 217

USDA is currently in various stages of the enrollment and onboarding process with four new programs. 

The programs are:

• FSA-Farm Loan Program

• FS-Grants & Agreements-State, Private, & Tribal Forestry

• NIFA-Office of Grants and Financial Management

• RMA-Federal Crop Insurance Corp

The Department aims to have enrollment for these programs completed during FY 2024. With the 

addition of these four programs, USDA is anticipating a 100 percent increase in user enrollment to 

over 3400 users by the end of FY24. 

Further Information

Annually, the Department gathers, analyzes, and submits data to OMB to be presented on 

www.paymentaccuracy.gov. OMB presents the data in several different methods, including information 

on individual agencies or on a Government-wide consolidated basis. This website contains current and 

historical information about improper payments made under Federal programs and extensive information 

about how improper payments are defined and tracked. Please refer to the paymentaccuracy.gov website 

for detailed results from the Department’s efforts in 2023 to comply with PIIA.
218 Section III | Other Information

Civil Monetary Penalty Adjustment for Inflation

USDA maintains regulations regarding civil monetary policies at Title 7 of the Code of Federal Regulations § 3.91. The Department reviews and 

updates the penalties in accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. 

The Department must update its civil monetary penalties to account for annual inflation each year. On May 10, 2023, the Department published the 

revised penalties for 2023 in the Federal Register.

The following table briefly describes the penalty, under which authority it pertains, and the current penalty amounts.

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Improper recordkeeping 7 U.S.C. 136i-1(d) Insecticides and 

Environmental Pesticide 

Control

5/10/2023 A maximum of $1,116 for the first 

offense and a minimum of $2,168 in 

the case of subsequent offenses, 

except that the penalty will be less 

than $2,168 if the Secretary 

determines that the person made a 

good faith effort to comply.

Agricultural 

Marketing Service

Violation of the unfair 

conduct rule

7 U.S.C. 499b(5) Perishable Agricultural 

Commodities Act

5/10/2023 Maximum of $6,075.

Agricultural 

Marketing Service

Violation of the licensing 

requirements

7 U.S.C. 499c(a) Perishable Agricultural 

Commodities Act

5/10/2023 Maximum of $1,939 for each such 

offense and not more than $484 for 

each day it continues, or a maximum 

of $484 for each offense if the 

Secretary determines the violation 

was not willful.

Agricultural 

Marketing Service

Civil penalty in lieu of 

license suspension

7 U.S.C. 499h(e) Perishable Agricultural 

Commodities Act

5/10/2023 Maximum penalty of $3,878 for each 

violative transaction or each day the 

violation continues.

Agricultural 

Marketing Service

Violation 7 U.S.C. 586 Export Apple Act 5/10/2023 Minimum of $176 and a maximum of 

$17,718.
USDA | 2023 Agency Financial Report 219

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Violation 7 U.S.C. 596 Export Grape and Plum Act 5/10/2023 Minimum of $338 and a maximum of 

$33,902.

Agricultural 

Marketing Service

Violation of an order 

issued by the Secretary

7 U.S.C. 608c(14)(B) Agricultural Adjustment Act 5/10/2023 Maximum of $3,391. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to file certain 

reports

7 U.S.C. 610 (C) Agricultural Adjustment Act 5/10/2023 Maximum of $338.

Agricultural 

Marketing Service

Violation of a seed 

program

7 U.S.C. 1596(b) Federal Seed Act 5/10/2023 Minimum of $115 and a maximum of 

$2,312.

Agricultural 

Marketing Service

Failure to collect any 

assessment or fee

7 U.S.C. 2112(b) Cotton Research and 

Promotion Act

5/10/2023 Maximum of $3,391.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee for a violation

7 U.S.C. 2621(b)(1) Potato Research and 

Promotion Act

5/10/2023 Minimum of $1,520 and a maximum 

of $14,017.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 2621(b)(3) Potato Research and 

Promotion Act

5/10/2023 Maximum of $1,520. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation of a 

program

7 U.S.C. 2714(b)(1) Egg Research and Consumer 

Information Act

5/10/2023 Minimum of $1,757 and a maximum 

of $17,571.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 2714(b)(3) Egg Research and Consumer 

Information Act

5/10/2023 Maximum of $1,757. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to remit any 

assessment or fee or for 

a violation of a program

7 U.S.C. 2908(a)(2) Beef Research and 

Information Act

5/10/2023 Maximum of $13,707.

Agricultural 

Marketing Service

Failure to remit any 

assessment or for a 

violation of a program

7 U.S.C. 3410(b) Wheat and Wheat Foods 

Research

5/10/2023 Maximum of $3,391.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation

7 U.S.C. 4314(b)(1) Floral Research and 

Consumer Information Act

5/10/2023 Minimum of $1,596 and a maximum 

of $15,954.
220 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 4314(b)(3) Floral Research and 

Consumer Information Act

5/10/2023 Maximum of $1,596. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Violation of an order 7 U.S.C. 4510(b) Dairy Promotion Program 5/10/2023 Maximum of $2,949.

Agricultural 

Marketing Service

Pay, collect, or remit any 

assessment or fee or for 

a violation

7 U.S.C. 4610(b)(1) Honey Research, Promotion, 

and Consumer Information 

Act

5/10/2023 Minimum of $886 and a maximum of 

$9,086.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 4610(b)(3) Honey Research, Promotion, 

and Consumer Information 

Act

5/10/2023 Maximum of $908. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Violation of a program 7 U.S.C. 

4815(b)(1)(A)(i)

Pork Promotion, Research, 

and Consumer Information 

Act of 1985

5/10/2023 Maximum of $2,742.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 

4815(b)(3)(A)

Pork Promotion, Research, 

and Consumer Information 

Act of 1985

5/10/2023 Maximum of $1,372. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation of a 

program

7 U.S.C. 4910(b)(1) Watermelon Research and 

Promotion Act

5/10/2023 Minimum of $1,372 and a maximum 

of $13,707.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 4910(b)(3) Watermelon Research and 

Promotion Act

5/10/2023 Maximum of $1,372. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation of a 

program

7 U.S.C. 6009(c)(1) Pecan Promotion and 

Research Act of 1990

5/10/2023 Minimum of $2,232 and a maximum 

of $22,313.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 6009(e) Pecan Promotion and 

Research Act of 1990

5/10/2023 Maximum of $2,230.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation

7 U.S.C. 6107(c)(1) Mushroom Promotion, 

Research, and Consumer 

Information Act of 1990

5/10/2023 Minimum of $1,085 and a maximum 

of $10,846.
USDA | 2023 Agency Financial Report 221

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 6107(e) Mushroom Promotion, 

Research, and Consumer 

Information Act of 1990

5/10/2023 Maximum of $1,085. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation

7 U.S.C. 6207(c)(1) Lime Research, Promotion, 

and Consumer Information 

Act of 1990

5/10/2023 Minimum of $1,085 and a maximum 

of $10,846. 

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 6207(e) Lime Research, Promotion, 

and Consumer Information 

Act of 1990

5/10/2023 Maximum of $1,085. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation of a 

program

7 U.S.C. 

6307(c)(1)(A)

Soybean Promotion, 

Research, and Consumer 

Information Act

5/10/2023 Maximum of $2,232.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 6307(e) Soybean Promotion, 

Research, and Consumer 

Information Act

5/10/2023 Maximum of $11,109. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation

7 U.S.C. 

6411(c)(1)(A), 

7 U.S.C. 

6411(c)(1)(B)

Fluid Milk Promotion Act of 

1990

5/10/2023 Minimum of $1,085 and a maximum 

of $10,846 or in the case of a 

violation that is willful, a minimum of 

$21,313 and a maximum of 

$216,892.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 6411(e) Fluid Milk Promotion Act of 

1990

5/10/2023 Maximum of $11,162. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Knowingly labeling or 

selling a product as 

organic

7 U.S.C. 6519(c) Organic Foods Production 

Act of 1990

5/10/2023 Maximum of $21,689.

Agricultural 

Marketing Service

Failure to pay, collect, or 

remit any assessment or 

fee or for a violation of a 

program

7 U.S.C. 

6808(c)(1)(A)(i)

Fresh Cut Flowers and Fresh 

Cut Greens Promotion and 

Information Act of 1993

5/10/2023 Minimum of $1,023 and a maximum 

of $10,226.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 6808(e)(1) Fresh Cut Flowers and Fresh 

Cut Greens Promotion and 

Information Act of 1993

5/10/2023 Maximum of $10,226. Each day the 

violation continues is a separate 

violation.
222 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Violation of a program 7 U.S.C. 

7107(c)(1)(A)

Sheep Promotion, Research, 

and Information Act of 1994

5/10/2023 Maximum of $1,993.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 7107(e) Sheep Promotion, Research, 

and Information Act of 1994

5/10/2023 Maximum of $996. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Violation of an order or 

regulation issued

7 U.S.C. 7419(c)(1) Commodity Promotion, 

Research, and Information 

Act of 1996

5/10/2023 Minimum of $1,881 and a maximum 

of $18,825 for each violation.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 7419(e) Commodity Promotion, 

Research, and Information 

Act of 1996

5/10/2023 Minimum of $1,881 and a maximum 

of $18,825. Each day the violation 

continues is a separate violation.

Agricultural 

Marketing Service

Violation of an order or 

regulation issued

7 U.S.C. 

7448(c)(1)(A)(i)

Canola and Rapeseed 

Research, Promotion, and 

Consumer Information Act,

5/10/2023 Maximum of $1,881 for each 

violation.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 7448(e) Canola and Rapeseed 

Research, Promotion, and 

Consumer Information Act

5/10/2023 Maximum of $9,413. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Violation of an order or 

regulation issued

7 U.S.C. 7468(c)(1) National Kiwifruit Research, 

Promotion, and Consumer 

Information Act

5/10/2023 Minimum of $942 and a maximum of 

$9,413 for each violation.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 7468(e) National Kiwifruit Research, 

Promotion, and Consumer 

Information Act

5/10/2023 Maximum of $942. Each day the 

violation continues is a separate 

violation.

Agricultural 

Marketing Service

Violation of an order or 

regulation

7 U.S.C. 7487(a) Popcorn Promotion, 

Research, and Consumer 

Information Act

5/10/2023 Maximum of $1,881 for each 

violation.

Agricultural 

Marketing Service

Violation 21 U.S.C. 

1041(c)(1)(A)

Egg Products Inspection Act 5/10/2023 Maximum of $10,846 for each 

violation.

Agricultural 

Marketing Service

Violation of an order or 

regulation issued

7 U.S.C. 

7807(c)(1)(A)(i)

Hass Avocado Promotion, 

Research, and Information 

Act of 2000

5/10/2023 Minimum of $1,711 and a maximum 

of $17,110 for each violation.
USDA | 2023 Agency Financial Report 223

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 7807(e)(1 Hass Avocado Promotion, 

Research, and Information 

Act of 2000

5/10/2023 Maximum of $17,127 for each 

offense. Each day the violation 

continues is a separate violation.

Agricultural 

Marketing Service

Violation of certain 

provisions

7 U.S.C. 1636b(a)(1) Livestock Mandatory 

Reporting Act of 1999

5/10/2023 Maximum of $17,718 for each 

violation.

Agricultural 

Marketing Service

Failure to obey a ceaseand-desist order7 U.S.C. 1636b(g)(3) Livestock Mandatory 

Reporting Act of 1999

5/10/2023 Maximum of $17,718 for each 

violation. Each day the violation 

continues is a separate violation.

Agricultural 

Marketing Service

Failure to obey an order 7 U.S.C. 

1637b(c)(4)(D)(iii)

Dairy Product Mandatory 

Reporting Program

5/10/2023 Maximum of $17,127 for each 

offense.

Agricultural 

Marketing Service

Willful violation 7 U.S.C. 1638b(b)(2) Country of Origin Labeling 

Program

5/10/2023 Maximum of $1,376 for each 

violation.

Agricultural 

Marketing Service

Violation 7 U.S.C. 4535 and 

4510(b)

Dairy Research Program 5/10/2023 Maximum of $2,949 for each 

violation.

Agricultural 

Marketing Service

Violation by a packer or 

swine contractor

7 U.S.C. 193(b) Packers and Stockyards 5/10/2023 Maximum of $33,896.

Agricultural 

Marketing Service

Failure for a livestock 

market agency or dealer 

to register

7 U.S.C. 203 Packers and Stockyards 5/10/2023 Maximum of $2,311 and not more 

than $115 for each day the violation 

continues.

Agricultural 

Marketing Service

Operating without filing, 

or in violation of, a 

stockyard rate schedule 

or of a regulation

7 U.S.C. 207(g) Packers and Stockyards 5/10/2023 Maximum of $2,312 and not more 

than $115 for each day the violation 

continues.

Agricultural 

Marketing Service

Stockyard owner, 

livestock market agency, 

or dealer who engages in 

or uses any unfair, 

unjustly discriminatory, 

or deceptive practice

7 U.S.C. 213(b) Packers and Stockyards 5/10/2023 Maximum of $33,896.

Agricultural 

Marketing Service

Stockyard owner, 

livestock market agency, 

or dealer who knowingly 

fails to obey any order

7 U.S.C. 211, 212, or 

213, codified at 

7 U.S.C. 215(a)

Packers and Stockyards 5/10/2023 Maximum of $2,312.
224 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Agricultural 

Marketing Service

Live poultry dealer 

violations

7 U.S.C. 228b-2(b) Packers and Stockyards 5/10/2023 Maximum of $98,605.

Agricultural 

Marketing Service

Violation 7 U.S.C. 86(c) Grain Standards 5/10/2023 Maximum of $331,249.

Agricultural 

Marketing Service

Failure to comply with 

certain provisions

7 U.S.C. 254 U.S. Warehouse Act 5/10/2023 Maximum of $42,818 per violation if 

an agricultural product is not 

involved in the violation.

Animal and Plant 

Health Inspection 

Service

Violation 7 U.S.C. 1596(b) Federal Seed Act 5/10/2023 Minimum of $115 and a maximum of 

$2,312.

Animal and Plant 

Health Inspection 

Service

Violation 7 U.S.C. 2149(b) Animal Welfare Act 5/10/2023 Maximum of $13,760, and knowingly 

failing to obey a cease-and-desist 

order has a civil penalty of $2,063.

Animal and Plant 

Health Inspection 

Service

Penalty for any person 

that causes harm to, or 

interferes with, an animal 

used for the purposes of 

official inspection by 

USDA

7 U.S.C. 2279e(a) Farming Opportunities 

Training and Outreach

5/10/2023 Maximum of $17,127.

Animal and Plant 

Health Inspection 

Service

Violation 7 U.S.C. 3805(a) Swine Health Protection Act 5/10/2023 Maximum of $34,422.
USDA | 2023 Agency Financial Report 225

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Animal and Plant 

Health Inspection 

Service

Penalty for any person 

that violates or that 

forges, counterfeits, or, 

without authority from 

the Secretary, uses, 

alters, defaces, or 

destroys any certificate, 

permit, or other 

document

7 U.S.C. 7734(b)(1) Plant Protection Act (PPA) 5/10/2023 Maximum of the greater of: $85,636 

in the case of any individual (except 

that the civil penalty may not 

exceed $1,712 in the case of an 

initial violation of the PPA by an 

individual moving regulated articles 

not for monetary gain), $428,175 in 

the case of any other person for 

each violation, $688,012 for all 

violations adjudicated in a single 

proceeding if the violations do not 

include a willful violation, and 

$1,376,023 for all violations 

adjudicated in a single proceeding if 

the violations include a willful 

violation; or twice the gross gain or 

gross loss for any violation, forgery, 

counterfeiting, unauthorized use, 

defacing, or destruction of a 

certificate, permit, or other 

document provided for in the PPA 

that results in the person deriving 

pecuniary gain or causing pecuniary 

loss to another person.
226 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Animal and Plant 

Health Inspection 

Service

Penalty for any person 

that violates or that 

forges, counterfeits, or, 

without authority from 

the Secretary, uses, 

alters, defaces, or 

destroys any certificate, 

permit, or other 

document

7 U.S.C. 8313(b)(1) Animal Health Protection 

Act (AHPA)

5/10/2023 Maximum of the greater of $82,187 

in the case of any individual, except 

that the civil penalty may not 

exceed $1,644 in the case of an 

initial violation of the AHPA by an 

individual moving regulated articles 

not for monetary gain, $410,933 in 

the case of any other person for 

each violation, $688,012 for all 

violations adjudicated in a single 

proceeding if the violations do not 

include a willful violation, and 

$1,376,023 for all violations 

adjudicated in a single proceeding if 

the violations include a willful 

violation; or twice the gross gain or 

gross loss for any violation, forgery, 

counterfeiting, unauthorized use, 

defacing, or destruction of a 

certificate, permit, or other 

document provided under the AHPA 

that results in the person deriving 

pecuniary gain or causing pecuniary 

loss to another person.

Animal and Plant 

Health Inspection 

Service

Penalty for any person 

that violates certain 

regulations regarding 

transfers of listed agents 

and toxins or possession 

and use of listed agents 

and toxins

7 U.S.C. 8401(i)(1) Agricultural Bioterrorism 

Protection Act of 2002

5/10/2023 Maximum of $410,933 in the case of 

an individual and $821,869 in the 

case of any other person.

Animal and Plant 

Health Inspection 

Service

Violation 15 U.S.C. 1825(b)(1) Horse Protection Act 5/10/2023 Maximum of $6,781.
USDA | 2023 Agency Financial Report 227

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Animal and Plant 

Health Inspection 

Service

Failure to obey the Horse 

Protection Act 

disqualification

15 U.S.C. 1825(c) Horse Protection Act 5/10/2023 Maximum of $13,252.

Animal and Plant 

Health Inspection 

Service

Knowingly violating, or, if 

in the business as an 

importer or exporter, 

violating, with respect to 

terrestrial plants, any 

provision

16 U.S.C. 1540(a)(1), 

section 9(a)(1)(A) 

through (F), 

(a)(2)(A) through 

(D), (c), (d) (other 

than regulations 

relating to recordkeeping or filing 

reports), (f), or (g)

Endangered Species Act of 

1973

5/10/2023 Maximum of $61,984 for each 

violation.

Animal and Plant 

Health Inspection 

Service

Knowingly violating, or, if 

in the business as an 

importer or exporter, 

violating, with respect to 

terrestrial plants, any 

other regulation

16 U.S.C. 1540(a)(1) Endangered Species Act of 

1973

5/10/2023 Maximum of $29,683 for each 

violation.

Animal and Plant 

Health Inspection 

Service

Violating, with respect to 

terrestrial plants or any 

regulation, permit, or 

certificate

16 U.S.C. 1540(a)(1) Endangered Species Act of 

1973

5/10/2023 Maximum of $1,564 for each 

violation.

Animal and Plant 

Health Inspection 

Service

Knowingly and willfully 

violating with respect to 

the transportation of 

animals by any rail 

carrier, express carrier, or 

common carrier (except 

by air or water), a 

receiver, trustee, or 

lessee of one of those 

carriers, or an owner or 

master of a vessel

49 U.S.C. 80502(d) Transportation of Animals 5/10/2023 Minimum of $195 and a maximum of 

$996.
228 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Animal and Plant 

Health Inspection 

Service

Violation and its 

implementing regulation

7 U.S.C. 1901 note, 

as specified in 

9 CFR 88.6

Commercial Transportation 

of Equine for Slaughter Act

5/10/2023 Maximum of $5,891. Each horse 

transported is a separate violation.

Animal and Plant 

Health Inspection 

Service

Knowingly violating or for 

violating any other 

provision provided that, 

in the exercise of due 

care, the violator should 

have known that the 

plant was taken, 

possessed, transported, 

or sold in violation of any 

underlying law, treaty, or 

regulation

16 U.S.C. 3373(a)(1) Lacey Act Amendments of 

1981

5/10/2023 Maximum of $30,822 for each 

violation, as specified in 16 U.S.C. 

3373(a)(1) (but if the plant has a 

market value of less than $412 and 

involves only the transportation, 

acquisition, or receipt of a plant taken 

or possessed in violation of any law, 

treaty, or regulation of the United 

States, any Indian tribal law, any 

foreign law, or any law or regulation 

of any State, the penalty will not 

exceed the maximum provided for 

violation of said law, treaty, or 

regulation, or $30,822, whichever is 

less).

Animal and Plant 

Health Inspection 

Service

Violation 16 U.S.C. 3373(a)(2) Lacey Act Amendments of 

1981

5/10/2023 Maximum of $770.

Food and Nutrition 

Service

Violating a provision or a 

regulation under the Act 

by a retail food store or 

wholesale food concern

7 U.S.C. 2021(a) and 

(c)

Food and Nutrition Act of 

2008 (Act)

5/10/2023 Maximum of $137,603 for each 

violation.

Food and Nutrition 

Service

Trafficking in food 

coupons

7 U.S.C. 

2021(b)(3)(B)

Food and Nutrition Act of 

2008 (Act)

5/10/2023 Maximum of $49,585 for each 

violation, except that the maximum 

penalty for violations occurring 

during a single investigation is 

$89,289.

Food and Nutrition 

Service

Sale of firearms, 

ammunition, explosives, 

or controlled substances 

for coupons

7 U.S.C. 

2021(b)(3)(C)

Food and Nutrition Act of 

2008 (Act)

5/10/2023 Maximum of $44,645 for each 

violation except that the maximum 

penalty for violations occurring 

during a single investigation is 

$89,289.
USDA | 2023 Agency Financial Report 229

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Food and Nutrition 

Service

Any entity that submits a 

bid to supply infant 

formula and discloses the 

amount of the bid, 

rebate, or discount 

practices in advance of 

the bid opening or for any 

entity that makes a 

statement prior to the 

opening of bids for the 

purpose of influencing a 

bid

42 U.S.C. 

1786(h)(8)(H)(i)

Special Supplemental 

Nutrition Program for 

Women, Infants, and 

Children

5/10/2023 Maximum of $210,161,878.

Food and Nutrition 

Service

Vendor convicted of 

trafficking in food 

instruments

42 U.S.C. 

1786(o)(1)(A) and 

42 U.S.C. 

1786(o)(4)(B)

Special Supplemental 

Nutrition Program for 

Women, Infants, and 

Children

5/10/2023 Maximum of $18,171 for each 

violation, except that the maximum 

penalty for violations occurring 

during a single investigation is 

$72,686.

Food and Nutrition 

Service

Vendor convicted of 

selling firearms, 

ammunition, explosives, 

or controlled substances 

in exchange for food 

instruments

42 U.S.C. 

1786(o)(1)(B) and 

42 U.S.C. 

1786(o)(4)(B)

Special Supplemental 

Nutrition Program for 

Women, Infants, and 

Children

5/10/2023 Maximum of $17,725 for each 

violation, except that the maximum 

penalty for violations occurring 

during a single investigation is 

$72,686.

Food Safety and 

Inspection Service

Violation 21 U.S.C. 

1041(c)(1)(A)

Egg Products Inspection Act 5/10/2023 Maximum of $10,846 for each 

violation.

Forest Service Willful disregard of the 

prohibition against the 

export of unprocessed 

timber originating from 

Federal lands

16 U.S.C. 

620d(c)(1)(A)

Federal Lands 5/10/2023 Maximum of $1,116,140 per 

violation or three times the gross 

value of the unprocessed timber, 

whichever is greater.

Forest Service Violation 16 U.S.C. 

620d(c)(2)(A)(i)

Forest Resources 

Conservation and Shortage 

Relief Act

5/10/2023 Maximum of $167,422 per violation.
230 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Forest Service Penalty for a person that 

should have known that 

an action was a violation 

regardless of whether 

such violation caused the 

export of unprocessed 

timber originating from 

Federal lands

16 U.S.C. 

620d(c)(2)(A)(ii),

Forest Resources 

Conservation and Shortage 

Relief Act

5/10/2023 Maximum of $111,614 per violation.

Forest Service Willful violation 16 U.S.C. 

620d(c)(2)(A)(iii)

Forest Resources 

Conservation and Shortage 

Relief Act

5/10/2023 Maximum of $1,116,140.

Forest Service Violation involving 

protections of caves

16 U.S. C. 4307(a)(2) Federal Cave Resources 

Protection

5/10/2023 Maximum of $24,393.

Federal Crop 

Insurance 

Corporation

Willfully and intentionally 

providing any false or 

inaccurate information

7 U.S.C. 

1515(h)(3)(A)

Federal Crop Insurance Act 5/10/2023 Maximum of the greater of the 

amount of the pecuniary gain 

obtained as a result of the false or 

inaccurate information or the noncompliance; or $14,478.

Rural Housing 

Service

Violation of section 536 

of Title V of the Housing 

Act of 1949

42 U.S.C. 

1490p(e)(2)

Housing Act of 1949 5/10/2023 Maximum of $237,267 in the case of 

an individual and a maximum of 

$2,372,677 in the case of an 

applicant other than an individual.

Rural Housing 

Service

Penalty for equity 

skimming

42 U.S.C. 

1490s(a)(2)

Housing Act of 1949 5/10/2023 Maximum of $42,818.
USDA | 2023 Agency Financial Report 231

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Rural Housing 

Service

Submitting false 

information, submitting 

false certifications, failing 

to timely submit 

information, failing to 

maintain real property in 

good repair and 

condition, failing to 

provide acceptable 

management for a 

project, or failing to 

comply with applicable 

civil rights laws and 

regulations

42 U.S.C. 

1490s(b)(3)(A)

Housing Act of 1949 5/10/2023 Maximum of the greater of twice the 

damages USDA, guaranteed lender, 

or project secured for a loan under 

Title V suffered or would have 

suffered as a result of the violation; 

or $85,636 per violation.

Commodity Credit 

Corporation

Penalty for willful failure 

or refusal to furnish 

information or willful 

furnishing of false 

information under 

Section 156

7 U.S.C. 7272(g)(5) Federal Agricultural 

Improvement and Reform 

Act of 1996

5/10/2023 Maximum of $18,825 for each 

violation.

Commodity Credit 

Corporation

Willful failure or refusal 

to furnish information or 

willful furnishing of false 

data by a processor, 

refiner, or importer of 

sugar, syrup, and 

molasses

7 U.S.C. 7272(g)(5) Federal Agriculture 

Improvement and Reform 

Act of 1996

5/10/2023 Maximum of $18,825 for each 

violation.

Commodity Credit 

Corporation

Filing a false acreage 

report that exceeds 

tolerance

7 U.S.C. 7272(g)(5) Federal Agriculture 

Improvement and Reform 

Act of 1996

5/10/2023 Maximum of $18,825 for each 

violation.
232 Section III | Other Information

Program Office

Penalty 

(Name of Penalty) U.S.C. Citation

Statutory Authority; 

Positive Law and Section 

Authority (Statute)

Date of 

Current 

Adjustment

Current Penalty Level 

($ Amount)

Commodity Credit 

Corporation

Knowingly violating any 

regulation of the 

Secretary of the 

Commodity Credit 

Corporation pertaining to 

flexible marketing 

allotments for sugar

7 U.S.C. 1359hh(b) Agricultural Adjustment Act 

of 1938

5/10/2023 Maximum of $13,760 for each 

violation.

Commodity Credit 

Corporation

Knowingly violating 

regulations promulgated 

by the Secretary 

pertaining to cotton 

insect eradication

7 U.S.C. 1444a(d) Agricultural Act of 1949 5/10/2023 Maximum of $16,952 for each 

offense.

Office of the 

Secretary

Making, presenting, 

submitting, or causing to 

be made, presented, or 

submitted a false, 

fictitious, or fraudulent 

claim

31 U.S.C. 3802(a)(1) Program Fraud Civil 

Remedies Act of 1986

5/10/2023 Maximum of $13,509.

Office of the 

Secretary

Making, presenting, 

submitting, or causing to 

be made, presented, or 

submitted a false, 

fictitious, or fraudulent 

written statement

31 U.S.C. 3802(a)(2) Program Fraud Civil 

Remedies Act of 1986

5/10/2023 Maximum of $13,509.
USDA | 2023 Agency Financial Report 233

Grants Programs

Pursuant to OMB Uniform Guidance in Section 200.344(a) of Part 2 of the CFR, recipients of grants 

and cooperative agreements must submit final reports and liquidate all obligations incurred under their 

awards within 120 days after the end of the period of performance, unless the Federal awarding 

department or agency authorizes an extension, or program-specific statutes specify a different 

liquidation period.

Exhibit 24 shows that USDA has 701 grants/cooperative agreements with an undisbursed balance of 

$78,744,175.30 for which closeout has not yet occurred, but for which the period of performance has 

elapsed by 2 years or more prior to September 30, 2023.

Exhibit 24: Fiscal Year 2023 Grants Program Summary

Category 2–3 Years >3–5 Years >5 Years

Number of Grants/Cooperative Agreements with Zero 

Dollar Balances 147 75 14

Number of Grants/Cooperative Agreements with 

Undisbursed Balances 346 96 23

Total Amount of Undisbursed Balances $32,539,683.82 $38,695,826.79 $7,508,664.69

USDA faces several challenges leading to delayed grant agreement award closeout, including:

• Timely receipt of the financial and accomplishment reports for the completion of closeout reports 

from grantees;

• Program Manager and Grant Specialist turnover;

• Delays in compliance reviews and pending audits during the award period;

• Delays in receipts of final vouchers from recipients;

• Awaiting litigation and cannot be close until the judicial system authorizes the agency to close;

• Administrative challenges related to finalizing rates and budget line-item agreements; and

• Delays in the resolution of audits by grant recipients.

Each USDA grant-making agency continues to review outstanding grants/cooperative agreements and 

monitor open balances through the Agency’s quarterly Unliquidated Obligations review for appropriate 

closeout actions. The grant-making agencies’ accountable officers continue their closeout of 

grants/cooperative agreements efforts and continuous communication with the recipients of USDA funds 

to ensure compliance with requirements of Title 2 CFR Part 200 and better management of Federal Funds.
234 Section III | Other Information

Climate-Related Financial Risk

Climate Action Plans and Sustainability Reports and Implementation Plans are posted at 

sustainability.gov, Office of the Federal Chief Sustainability Officer, and on agency websites.

USDA Action Plan for Climate Adaptation and Resilience: 2022 Progress Report

USDA 2022 Sustainability Plan

USDA Agency-Level Climate Adaptation Plans prepared by:

• Natural Resources Conservation Service

• Farm Service Agency

• Risk Management Agency

• Agricultural Marketing Service

• Animal and Plant Health Inspection Service

• Forest Service

• Rural Development

• Agricultural Research Service

• National Institute of Food and Agriculture

• National Agricultural Statistics Service

• Economic Research Service

• Foreign Agricultural Service

• Select Staff Offices including the Office of the Chief Economist, the Office of Budget and 

Program Analysis, the Office of Property and Environmental Management, and the Office of 

Homeland Security

USDA’s Action Plan for Climate Adaptation and Resilience
USDA | 2023 Agency Financial Report 235

Agency Audits Resolution Report

Background

The Inspector General (IG) Act Amendments of 1988 (P.L. 100–504; IG Act Amendments) require that 

each agency head submit semi-annual reports to Congress on actions taken in response to the OIG 

audit, evaluation, and inspection reports. Consistent with the Reports Consolidation Act of 2000 

(P.L. 106–531), OCFO consolidates, annualizes, and includes the required semi-annual IG Act 

Amendments’ reporting elements in the annual Agency Financial Report.

OIG audits USDA’s programs, systems, and operations and recommends improvements to 

management based on its findings. USDA management may agree or disagree with the audit’s findings 

or recommendations. When management agrees with recommendations in an audit, it submits a written 

plan for corrective action and an estimated target completion date to the OIG for concurrence. If OIG 

and management agree that the proposed corrective action will address the finding, the “management 

decision” process is concluded for that recommendation. The memo outlining the terms of the 

management decision between management and OIG is retained for audit follow-up purposes. 

USDA’s OCFO oversees audit follow-up for the Department and ensures that management takes 

prompt and responsive action to address OIG findings and audits. As USDA completes corrective 

actions relative to the management decision, it submits documentation as “final action” to OCFO to 

complete the review process. OCFO reviews the submitted documentation and determines whether 

USDA provided adequate support for the completion of corrective actions agreed to in the management 

decision. If confirmed, OCFO “closes” the recommendation. An audit remains open until all corrective 

actions for each recommendation are completed.
236 Section III | Other Information

Fiscal Year Results

As of September 29, 2023, USDA agencies closed 38 audits during FY 2023. OIG and USDA agencies 

also reached management decisions on 17 audits. As shown in the following exhibit, the Department’s 

inventory of open audits decreased in FY 2023 by 30 percent, from 70 to 49.8

Exhibit 25: Open Audit Inventory

Note: Open audit inventory for FY 2021 corrected to 78 and for FY 2022 corrected to 70.

Audit Follow-Up Process

The IG Act Amendments require an annual report to Congress providing the status of resolved audits 

that remain open. Resolved audits are those where a management decision has been reached for all 

recommendations. Reports on resolved audits must include the elements listed in the following bullet 

points (see Exhibit 26 for definitions):

• Beginning and ending balances for the number of audit reports and dollar value of disallowed 

costs (DC) and Funds to Be Put to Better Use (FTBU);

• The number of new management decisions reached;

8 This report and information was generated on 09/28/2023 and updated on 09/29/2023. Percentage decreased was calculated using 

the percentage decrease formula. Two additional management decisions were received on 09/25/2023 and 09/29/2023 but the records 

have not been entered in the AFTR records as yet and are therefore not yet accounted for here.
USDA | 2023 Agency Financial Report 237

• The disposition of DC and FTBU of audits with final action (for example: accounts receivables, 

cash collections, agency offsets, write-offs); and

• Resolved audits that remain open 1 year or more past the management decision date require 

additional reporting elements. These elements include the date issued, the revised estimated 

completion date, the original dollar value of DC or FTBU, and an explanation as to why the final 

action has not been completed.

Exhibit 26: Audit Follow-Up Definitions

Term Definition

DC An incurred cost questioned by the OIG that management agreed should not be chargeable 

to the Government.

Final Action Actions that management has taken to address the audit findings and recommendations.

FTBU

An OIG recommendation that funds could be used more efficiently if management completes 

the recommendation. This recommendation includes:

a. Reductions in outlays or other savings;

b. De-obligation of funds from programs or operations;

c. The withdrawal of subsidy costs on loans, guarantees, or bonds; and

d. Implementation of recommended improvements for grants or contracts, or unnecessary 

expenditures noted in pre-award reviews of contracts or grant agreements.

Management 

Decision

Agreement between management and OIG on the corrective action needed to address audit 

findings and recommendations.

Beginning and Ending Inventory for Audits with DC and 

FTBU

Of the 38 audits that achieved final action during the fiscal year, ten contained DC. The number of audits 

with DC remaining in the inventory at the end of the fiscal year was 12, with an outstanding balance of 

$10,588,916.66 (see Exhibit 27). For DC audits that achieved final action in FY 2023, OIG and 

management agreed to collect $1,571,258. Four of the audits in the Beginning of the Period are audits 

that had open recommendation(s) with DC in FY 2020 whose recommendations with DC closed in 

FY 2023; one audit that opened in FY 2023 also closed out it’s recommendation with DC in FY 2023. 

These audits remain open but no longer have a DC balance and have been removed from the count of 

Audits listed at the End of the Period.
238 Section III | Other Information

Exhibit 27: Inventory of Audits with DC9

Audits with DC # of Audits Amount ($)

Beginning of the Period (October 1, 2022) 25** $ 60,613,944

Plus: New Management Decisions 2 $ 927,572

Total Audits Pending Collection of DC 27 $ 61,541,516

Less: Adjustments[1] $ 49,435,341

Revised Subtotal $ 12,106,175

Less: Final Actions (Recoveries)[2] 10 $ 1,571,258

Audits with DC Requiring Final Action at the End of the Period 

(September 30,2023)[3] 12 $ 10,588,917

*Exhibits 27 and 28 include only those open audits with DC and FTBU, respectively. In addition, some audits contain both DC and FTBU 

amounts. For this reason, the number of audits shown as the ending balances in Exhibits 27 and 28 do not equal the total resolved audit 

inventory balance in Exhibit 25.

**This number has been adjusted from the FY 2022 Ending Balance.

[1] This include monetary actions that close out the DC balances of audits that otherwise remain open: 03601-0003-31, 03702-0001-32, 

10702-0001-23, 50099-0011-SF, and 96801-0001-22.

[2] This total only includes audits with an Audit Agreed Amount DC, where the entire audit has been closed. 

[3] Five of the Audits with DC Balances at the beginning of the period closed out their DC balances without closing out the Audit. While 

the audits remain open, they no longer count as Audits with DC. (see Adjustments [1])

Final action occurred on one audit that involved an FTBU amount totaling $297,570. Two audits with 

unresolved FTBU balances remain in the inventory as of September 29, 2023, with an outstanding 

audit amount of $6,107,822. (See Exhibit 28). Two additional audits that had open FTBU balances 

resolved those balances as implemented and are not counted towards the count of audits with FTBU 

requiring final action at the end of FY 2023.

Exhibit 28: Inventory of Audits with FTBU10

Audits with FTBU # of Audits Amount ($)

Beginning of the Period (October 1, 2022) 3 $ 204,591,460

Plus: New Management Decisions 2 $ 18,091,344

Total Audits Pending 5 $ 222,682,804

Less: Adjustments $ 216,574,979

Less: Final Actions[1] 1 $ 292,570

Audits with FTBU Requiring Final Action at the End of the Period 

(September 30, 2023)[2] 2 $ 6,107,822

Disposition of FTBU:

FTBU Implemented 2 $ 216,574,979

FTBU Not Implemented 0 $ 0

Total FTBU Amounts for Final Action Audits 0 $ 0

* Exhibits 27 and 28 include only those open audits with DC and FTBU, respectively. In addition, some audits contain both DC and FTBU 

amounts. For this reason, the number of audits shown as the ending balances in Exhibits 27 and 28 do not equal the total resolved audit 

inventory balance in Exhibit 25.

[1] This number contains the final action of Audit 03601-0012-AT whose FTBU monetary action and associated recommendations were 

approved and closed before 2010. The listed $292,570 is not accounted for in either the beginning period nor in the end of period balances. 

[2] Two audits closed out their FTBU recommendations as implemented but remain open at the end of the period. They are accounted 

for in the Disposition of FTBU and the Adjustments.

9 This exhibit was generated on 09/28/2023

10 This exhibit was generated on 09/28/2023 
USDA | 2023 Agency Financial Report 239

The number of audits open for more than 1 year at the beginning of FY 2023 decreased from the previous 

fiscal year from 52 to 36. During FY 2023, thirteen audits became 1-year-after-Managment Decision Date 

(MDD). Of those 5 closed and the ending inventory includes the remaining 8 audits that became 1-yearafter-MDD during FY 2023. These audits were offset by the 24 audits that were previously 1-year-afterMDD but closed during FY 2023. USDA agencies continue to pursue remediation and/or compensating 

controls to address many of the underlying issues identified in these audits.

The number of audits open 1 or more years after the MDD decreased by 16 (see Exhibit 29). 

Exhibit 29: The Number of Audits Open 1 or More Years After MDD11

Audits 1 Year or More After MDD # of Audits

Beginning of the period* 52

Plus: Audits that reached 1 year after MDD during FY 2023 13

Subtotal FY 2023 audits 1 year or more after MDD 65

Less: Audits closed** 29

Ending balance as of September 30, 2023 36

** Includes the 24 closed audits from the beginning balance and the 5 audits that became 1 year or more past MDD and closed this year. 

Exhibit 30: Distribution of Audits Open 1 Year or More After MDD[1] 12

Audits on Schedule Audits Behind Schedule Audits Under Collection

# DC ($) FTBU ($) # DC ($) FTBU ($) # DC ($) FTBU ($)

0 $0 $0 16 $9,724,543 $6,089,279 12 $8,456,614 $0

DC = Disallowed Cost. FTBU = Funds to be Put to Better Use.

*All 12 audits listed in Under Collections are also listed in the Behind Schedule columns. The total number of Audits Open 1 Year or 

More After MDD is 36, consistent with Exhibit 29.

11 This exhibit was updated on 09/29/2023

12 This exhibit was generated on 9/28/2023
240 Section III | Other Information

Management’s Report on Audit Follow-Up

Audits without Final Action 1 year or more after MDD (excluding the # audits that are just waiting on collections) as of 9/30/2023 are/were behind 

schedule and listed individually in Exhibit 31. The audits are categorized by agency and the reason why final action has not occurred. Audits that 

reached Final Action between 10/1/2023 and the issuance of this report are noted in the Reason Pending column.

Exhibit 31: Audits Open 1 Year or More After MDD and Behind Schedule

Animal and Plant Health Inspection Service (APHIS)

Audits

Date 

Issued

Revised 

Completion 

Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

50601-0001-32 9/22/2015 12/31/2023 Controls Over APHIS Introduction of 

Genetically Engineered Organisms $0 $0 Receipt and/or processing of Final Action Documentation; Administrative Action

APHIS Subtotal (1) $0 $0
USDA | 2023 Agency Financial Report 241

Food and Nutrition Service (FNS)

Audits

Date 

Issued

Revised 

Completion 

Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

27601-0001-31 7/31/2013 12/1/2023 FNS Control for Authorizing (SNAP) Retailers $0 $0

Issuance of Policy/Guidance 

Receipt and/or processing of Final 

Action Documentation

27601-0003-10 9/27/2016 11/15/2023

New Mexico’s Compliance with SNAP 

Certification of Eligible Households 

Requirements

$9,621 $0 Receipt and/or processing of Final 

Action

27601-0005-41 9/18/2020 12/1/2023 Consolidated Report on FNS and Selected 

State Agencies Control Over SFSP $0 $6,089,279

Issuance of Policy/Guidance; 

Receipt and/or processing of Final 

Action Documentation; 

Administrative Action

27601-0013-10 12/19/2017 12/31/2023

Compilation Report of States’ Compliance 

with SNAP Requirements for Participating 

State Agencies (7 CFR, Part 272)

$0 $0 Issuance of Policy/Guidance

27601-0019-10 9/28/2018 4/30/2024

Compilation Report of States’ Compliance 

with Requirements for the Issuance and Use 

of SNAP Benefits

$0 $0 Issuance of Policy/Guidance

27702-0001-22 10/18/2019 11/30/2023 Review of FNS Nutrition Assistance Program 

Providing Disaster Funding to Puerto Rico $1,258,308 $0 Administrative Action

27801-0003-22 8/25/2021 12/31/2023

COVID 19 - Supplemental Nutrition 

Assistance Program Online Purchasing in 

Response to the Coronavirus Disease 2019

$0 $0 Administrative Action

FNS Subtotal (7) $1,267,929 $6,089,279
242 Section III | Other Information

Farm Service Agency (FSA)

Audits

Date 

Issued

Revised 

Completion 

Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

03601-0001-22 7/31/2014 12/30/2023 Compliance Activities $0 $0 Issuance of Policy/Guidance

03601-0003-31 3/9/2022 3/31/2024 Market Facilitation Program $0 $0 Receipt and/or processing of Final Action 

Documentation

50601-0003-22 1/27/2017 3/31/2024

Coordination of USDA Farm 

Program Compliance—FSA, Risk 

Management Agency, and Natural 

Resource Conservation Service

$0 $0 Receipt and/or processing of Final Action 

Documentation

03702-0001-23 9/28/2020 3/31/2024 2017 Emergency Assistance for 

Honeybee Claims $0 $0 Issuance of Policy/Guidance; Receipt and/or processing of Final Action Documentation

03702-0001-32 12/10/2014 3/31/2024 Livestock Forage Program $0 $0 Receipt and/or Processing of Final Action 

Documentation

03601-0003-31(1) 9/30/2020 3/31/2024 Market Facilitation Program –

Interim Report $0 $0 Issuance of Policy/Guidance; Receipt and/or processing of Final Action Documentation

FSA Subtotal (6) $0 $0

Natural Resources Conservation Service (NRCS)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

10403-0004-11 11/15/2021 12/31/2023 NRCS Financial Statements for 

Fiscal Years 2021 and 2020 $0 $0 Issuance of Policy/Guidance

10702-0001-23 6/25/2021 3/30/2024

Hurricane Disaster AssistanceEmergency Watershed Protection 

Program

$9,798,133 $198,502,181

Issuance of Policy/Guidance; Receipt 

and/or processing Final Action 

Documentation; Results of Internal 

Monitoring or Program Review

NRCS Subtotal (2) $9,798,133 $198,502,181
USDA | 2023 Agency Financial Report 243

Office of Advocacy and Outreach (OAO)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

91601-0001-21 11/10/2021 10/31/2024

Outreach and Assistance for Socially 

Disadvantaged Farmers, Ranchers, 

and Veteran Farmers

$0 $0 Issuance of Policy/Guidance

OAO Subtotal (1) $0 $0

Office of the Assistant Secretary for Civil Rights (OASCR)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

60601-0001-21 9/22/2021 12/29/2023 USDA Oversight of Civil Rights 

Complaints $0 $0 Issuance of Policy/Guidance

OASCR Subtotal (1) $0 $0

Office of the Chief Financial Officer (OCFO)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

11601-0001-12 11/8/2019 3/29/2024 USDA Fiscal Year 2019 First Quarter 

Data Act Submission $0 $0 Issuance of Policy/Guidance

50401-0020-11 11/15/2021 12/31/2023

USDA’s Consolidated Financial 

Statements for Fiscal Years 2021 and 

2020

$0 $0 Issuance of Policy/Guidance

OCFO Subtotal (2) $0 $0
244 Section III | Other Information

Office of Chief Information Officer (OCIO)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

50501-0017-12 9/28/2018 12/30/2023 Security Over Select USDA Agencies 

Network and Systems Fiscal Year 2018 $0 $0 Administrative Action

50501-0020-12(1) 6/26/2018 12/31/2023 Improper Usage of USDA’s Information 

Technology Resources $0 $0 Receipt and/or processing of Final Action Documentation

50801-0002-12 10/27/2021 11/30/2023 Security Over USDA Web Applications $0 $0 Issuance of Policy/Guidance

OCIO Subtotal (3) $0 $0

Office of Small and Disadvantaged Business Utilization (OSDBU)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

50601-0003-23 9/28/2018 12/31/2023 OSDBU’s Control Over the Eligibility of 

Contract Recipients $0 $0 Issuance of Policy/Guidance

OSDBU Subtotal (1) $0 $0

Research, Education, and Economics Agency (REE)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

84801-0001-22 12/8/2020 9/30/2024 USDA Research Integrity and Capacity $0 $0 Administrative Action

REE Subtotal (1) $0 $0
USDA | 2023 Agency Financial Report 245

Risk Management Agency (RMA)

Audits

Date 

Issued

Revised 

Completion Date Audit Title

Monetary Amount

DC ($) FTBU ($) Reason Pending

05601-0007-31 6/30/2020 12/1/2023 Controls Over Crop Insurance 

Section 508(H) Products $0 $0 Issuance of Policy/Guidance

RMA Subtotal (1) $0 $0
246 Abbreviations and Acronyms

Abbreviations — Acronyms

— A —

AARCC............................Agricultural Research and Commercialization Corporation

ADA................................Anti-Deficiency Act

AFR ................................Agency Financial Report

AgPay XP........................AgPay Xpress

AHPA..............................Animal Health Protection Act

AIPs................................Approved Insurance Providers

AMS ...............................Agricultural Marketing Service

APEC ..............................Access, Participation, Eligibility, and Certification Study

APEX ..............................Oracle Application Express

APHIS.............................Animal and Plant Health Inspection Service

APP ................................Annual Performance Plan

APR ................................Annual Performance Report

AQI.................................Agricultural Quarantine Inspection

AR ..................................Administrative Review

ARC ................................Agriculture Risk Coverage

ARS ................................Agricultural Research Service

— B —

BAR................................Budget and Accrual Reconciliation

BARC..............................Beltsville Agricultural Research Center

BOC................................Budget Object Classification
USDA | 2023 Agency Financial Report 247

— C —

CACFP ............................Child and Adult Care Food Program

CAP ................................Commodity Assistance Program

CARES Act......................Coronavirus Aid, Relief, and Economic Security Act

CARS ..............................Compliance Activities and Results Systems

CBOs..............................Certificates of Beneficial Ownership

CCC ................................Commodity Credit Corporation

CDM...............................Cybersecurity Diagnostic and Migration

CFR.................................Code of Federal Regulations

CLM ...............................Contract and Lease Management

CN..................................Child Nutrition

CoC ................................Cushion of Credit

CORE..............................Core Accounting System

COVID-19.......................Coronavirus Disease 2019

CPAIS..............................Corporate Property Automated Information Systems

CPI .................................Consumer Price Index

CPIC ...............................Capital Planning and Investment Control

CRBG..............................Citrus Recovery Block Grant

CSAM.............................Cyber Security Assessment and Management

Cwt. ...............................Hundredweight

— D —

DC..................................Disallowed Costs

Department, the............U.S. Department of Agriculture

DHS................................Department of Homeland Security

DM&R............................Deferred Maintenance

DNP................................Do Not Pay

DOL................................Department of Labor

DR..................................Departmental Regulation

— E —

EA ..................................Enterprise Architecture

EBT.................................Electronic Benefits Transfer

ECD ................................Estimated Completion Date

ECP.................................Electronic Check Processing

eFG ................................ezFedGrants

EGMO............................Enterprise Geospatial Management Office

EPICCS............................Erroneous Payments in CACFP Centers Study

ERM ...............................Enterprise Risk Management

ERP ................................Enterprise Resource Planning

ERS.................................Economic Research Service

EWP ...............................Emergency Watershed Protection
248 Abbreviations and Acronyms

— F —

FAS.................................Foreign Agricultural Service

FASAB ............................Federal Accounting Standards Advisory Board

FBWT .............................Fund Balance with Treasury

FCIC................................Federal Crop Insurance Corporation

FDCH..............................Family Day Care Homes

FECA ..............................Federal Employees’ Compensation Act

FEMA .............................Federal Emergency Management Agency

FFAR...............................Foundation for Food and Agricultural Research

FFB.................................Federal Financing Bank

FFMIA ............................Federal Financial Management Improvement Act

FFMS..............................Federal Financial Management System

FIET................................Financial Intelligent Enterprise Transformation

FISMA ............................Federal Information Security Modernization Act

FITARA ...........................Federal Information Technology Reform Act

FMFIA ............................Federal Managers’ Financial Integrity Act

FMMI.............................Financial Management Modernization Initiative

FMPS..............................Financial Management Payroll Summit

FMS................................Financial Management Services

FNS ................................Food and Nutrition Service

FPAC...............................Farm Production and Conservation

FR...................................Financial Report

FS ...................................Forest Service

FSA.................................Farm Service Agency

FSFL................................Farm Storage Facility Loan Program

FSH.................................Forest Service Handbook

FSIS ................................Food Safety and Inspection Service

FSM................................Forest Service Manual

FTBU..............................Funds to Be Put to Better Use

FY...................................Fiscal Year

— G —

GAO ...............................Government Accountability Office

GAOA.............................Great American Outdoors Act

GSA................................General Services Administration

GTAS ..............................Government-wide Treasury Account Symbol Adjusted Trial Balance System

— H —

HANA.............................High-Performance Analytic Appliance

HHS................................Health and Human Services
USDA | 2023 Agency Financial Report 249

— I —

IBNR...............................Incurred but Not Reported

IG...................................Inspector General

IPERIA ............................Improper Payment Elimination and Recovery Improvement Act of 2012

IPIA ................................Improper Payments Information Act of 2002

IT....................................Information Technology

— K - L —

KPIs................................Key Performance Indicators

L&WCF...........................Land and Water Conservation Fund

LFP .................................Livestock Forage Disaster Program

— M —

MDD ..............................Management Decision Date

ME .................................Management Evaluation

MRP...............................Marketing and Regulatory Programs

— N —

NAL ................................National Agricultural Library

NASS ..............................National Agricultural Statistics Services

NFS ................................National Forest System

NIFA ...............................National Institute of Food and Agriculture

NRCS ..............................Natural Resources Conservation Service

NSLP...............................National School Lunch Program

nTIG...............................Non-Competitive Technology Innovation Grants

— O —

OASCR............................Office of the Assistant Secretary for Civil Rights

OBPA..............................Office of Budget and Program Analysis 

OCFO .............................Office of the Chief Financial Officer

OCIO ..............................Office of the Chief Information Officer

OCS ................................Office of the Chief Scientist

OGC ...............................Office of the General Counsel

OIG ................................Office of Inspector General

OMB ..............................Office of Management and Budget

OPPE..............................Office of Partnership and Public Engagement

OSDBU...........................Office of Small and Disadvantaged Business Utilization
250 Abbreviations and Acronyms

— P —

P.L. .................................Public Law

PHA................................Priority Heritage Assets

PHE ................................End of Public Health Emergency

PIIA ................................Payment Integrity Information Act of 2019

PLC.................................Price Loss Coverage

PMC...............................Plant Materials Center

PMS ...............................Payment Management System

POC................................Proof of Concept

PP&E..............................Property, Plant and Equipment

PPA.................................Plant Protection Act

— Q —

QSMO............................Quality Service Management Office

— R —

RD..................................Rural Development

REE.................................Research, Education, and Economics

RMA...............................Risk Management Agency

— S —

SAC ................................SAP Analytics Cloud

SAM ...............................System for Award Management

SAP ................................Systems, Applications, and Products

SAs.................................State Agencies

SBP.................................School Breakfast Program

SBR ................................Statement of Budgetary Resources

SFAs ...............................School Food Authorities

SFFAS .............................Statement of Federal Financial Accounting Standards

SFSP ...............................Summer Food Service Program

SNAP..............................Supplemental Nutrition Assistance Program

SOB................................Summary of Business

SSO ................................Seamless Summer Option

SSP.................................Shared Services Provider

SY...................................School Year

— T —

TFAA ..............................Trade and Foreign Agricultural Affairs

TPMC .............................Tucson Plant Materials Center
USDA | 2023 Agency Financial Report 251

— U —

U.S.C. .............................U.S. Code

USDA..............................U.S. Department of Agriculture

USSGL ............................U.S. Standard General Ledger

— V - W —

WIC................................Women, Infants, and Children
United States Department of Agriculture