FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 1

FEDERAL MARITIME COMMISSION 

PERFORMANCE AND 

ACCOUNTABILITY REPORT 

FISCAL YEAR 

2009 
 2 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 

 

 

 

 

 

MISSION 

The FMC’s Mission is: 

 

To foster a fair, efficient and 

reliable international ocean 

transportation system and to 

protect the public from unfair 

and deceptive practices. 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 3

This Fiscal Year 2009 Performance and Accountability Report 

is published by the 

Federal Maritime Commission 

An electronic version of this report can be found at 

http://www.fmc.gov/home/performanceaccountabilityreports.asp

Please refer any questions concerning this report to the 

Federal Maritime Commission at 

(202) 523-5800 

Published in Washington, DC 

November 16, 2009 
 4 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 

The Federal Managers’ Financial Integrity Act of 1982 requires continuous evaluations and reporting of the adequacy 

of the systems of internal accounting and administrative controls. The Act can be found at the following URL: 

http://www.whitehouse.gov/omb/financial/fmfia1982.html

The Chief Financial Officers Act of 1990 provides for the production and submission of complete, reliable, timely, and 

consistent financial information for the use of the Executive Branch of the government and the Congress in the financing, 

management and evaluation of Federal programs. The Act can be found at the following URL: 

http://www.gao.gov/special.pubs/af12194.pdf

The Reports Consolidation Act of 2000 authorizes agencies to consolidate several reports in order to provide performance, 

financial and other related information in a more useful manner. The Act can be found at the following URL: 

http://www.cbo.gov/showdoc.cfm?index=2193&sequence=0

The Inspector General Reform Act of 2008 amends the Inspector General Act of 1978 to enhance the independence of the 

Inspectors General, to create a Council of the Inspectors General on Integrity and Efficiency, and for other purposes. The 

Act can be found at the following URL: 

https://www.oig.lsc.gov/legis/pl110-409.pdf

The Government Performance and Results Act of 1993 requires an annual report that measures the performance results 

of the agency against the established agency goals. The Act can be found at the following URL: 

http://www.whitehouse.gov/omb/mgmt-gpra/gplaw2m.html

The Government Management Reform Act of 1994 requires the submission of audited financial statements. The Act can 

be found at the following URL: 

http://govinfo.library.unt.edu/npr/library/misc/s2170.html

The Federal Maritime Commission’s Performance and Accountability Report provides 

program and financial information that enables the President, Congress, and the public to 

assess the performance of the agency relative to its mission and the resources entrusted to it. 

This PAR satisfies the following legislation: 

The Improper Payments Act of 2002 provides for estimates and reports of improper payments by Federal agencies. The Act 

can be found at the following URL: 

http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=107_cong_public_laws&docid=f:publ300.107.pdf
-#- 

 1920 Act Merchant Marine Act, 1920

 1984 Act Shipping Act of 1984

-A- 

 ADP Automated Data Processing 

 ADR Alternative Dispute Resolution 

 ALC Agency Location Code 

 ALJ Administrative Law Judge 

 AR Area Representative 

-B- 

 BCL Bureau of Certification and Licensing 

 BOE Bureau of Enforcement 

 BPD Bureau of the Public Debt 

 BTA Bureau of Trade Analysis 

-C- 

 CADRS Office of Consumer Affairs and Dispute Resolution 

 Services 

 C&A Certification and Accreditation 

 CFO Chief Financial Officer 

 CFR Code of Federal Regulations 

 CIO Chief Information Officer 

 COTR Contracting Officer’s Technical Representative 

 CSRS Civil Service Retirement System 

 

-D- 

 DC District of Columbia 

 DCIA Debt Collection Improvement Act 

 DMS Debt Management Service 

 DJHPM Dembo, Jones, Healy, Pennington & Marshall, P.C. 

 DOL Department of Labor 

-E- 

 EEO Equal Employment Opportunity 

 e-OPF Electronic Official Personnel File 

-F- 

 FACTS Federal Agencies’ Centralized Trial-Balance System 

 FASAB Federal Accounting Standards Board 

 FDCC Federal Desktop Core Configuration 

 

 GLOSSARY OF ACRONYMS 
-F- 

 FECA Federal Employee’s Compensation Act 

 FERS Federal Employee’s Retirement System 

 FISMA Federal Information Security Management Act 

 FMC/Commission Federal Maritime Commission 

 FMFIA Federal Managers’ Financial Integrity Act 

 FSPA Foreign Shipping Practices Act of 1988 

 FTE Full Time Equivalent 

 FY Fiscal Year 

-G- 

 GPRA Government Performance and Results Act 

 GPEA Government Paperwork Elimination Act 

 GRI General Rate Increase 

 GS General Schedule 

-H- 

 HCP Human Capital Plan 

-I- 

 IPAC Intergovernmental Payments and Collections 

 IT Information Technology 

 

-M- 

 MTO Marine Terminal Operator 

-N- 

 NFC National Finance Center 

 NIST National Institute of Standards and Technology 

 NSA NVOCC Service Arrangements 

 NVOCC Non-Vessel Operating Common Carrier 

-O- 

 OA Office of Administration 

 OFM Office of Financial Management 

 OGC Office of General Counsel 

 OHR Office of Human Resources 

 OIG Office of the Inspector General 

 OIT Office of Information Technology 

 OMB Office of Management and Budget 

 OMS Office of Management Services 

 GLOSSARY OF ACRONYMS 
-O- 

 OPM Office of Personnel Management 

 OPs Office of Operations 

 OS Office of the Secretary 

 OSRA Ocean Shipping Reform Act of 1988 

 OTI Ocean Transportation Intermediary 

-P- 

 P.L. Public Law 

 PAR Performance and Accountability Report 

 PART Performance Assessment Rating Tool 

 PII Personally Identifiable Information 

 PMA President’s Management Agenda 

 PVO Passenger Vessel Operator 

-R- 

 RPI Registered Persons Index 

-S- 

 SBR Statement of Budgetary Resources 

 SBREFA Small Business Regulatory Enforcement Fairness Act of 

 1996 

 SES Senior Executive Service 

 Shipping Act Shipping Act of 1984 

 SOP Standard Operating Procedures 

-T- 

 TIN Taxpayer Identification Number 

 TSP Thrift Savings Plan

 -V- 

 VOCC Vessel-Operating Common Carrier 

 GLOSSARY OF ACRONYMS 
 TABLE OF CONTENTS 

 8 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 

 

 A Message From the Chairman 

 Chapter One: Management’s Discussion and Analysis 

 

 Introduction 1 

 Organization Chart 2 

 Regulatory Responsibility 3 

 Future Challenges 4 

 Program Performance Overview 5 

 President’s Management Agenda 5 

 Financial Performance Overview 6 

 Financial Statement Highlights 8 

 Systems, Controls, and Legal Compliance 11 

 Chairman’s FMFIA Statement of Assurance 14 

 

 Chapter Two: Program Performance 

 

 Annual Performance Report 16 

 Performance Measure Summary Tables 18 

 

 Chapter Three: Auditor’s Report and Financial Statements 

 

 A Message from the Chief Financial Officer 26 

 Principal Statements - Limitations of the Financial Statements 27 

 Independent Auditor’s Report 28 

 Balance Sheets 33 

 Statements of Net Cost 34 

 Statements of Changes in Net Position 35 

 Statements of Budgetary Resources 36 

 Statements of Custodial Activity 37 

 Notes to the Financial Statements 38 

 

 Chapter Four: Other Accompanying Information 

 

 Inspector General-Identified Management and Performance Challenges 49 

 Comments on Management and Performance Challenges Identified by the 

 Inspector General 53 

 Improper Payments Information Act 54 

 Summary of Financial Statement Audit and Management Assurances 56 

 Annual Performance Plan 2009 57 

 

 

 
I am very pleased to have been appointed Chairman of the Federal Maritime Commission (FMC) in September 

2009. Having returned to where I first served thirty-five years ago, the expertise, 

dedication and commitment to excellence in public service is still there -- with many of 

the same employees who served with me -- representing historical continuity. The 

FMC’s investment in its human capital has ensured that we attract and retain staff who 

possess strong technical skills and experience. Our agency may be small in size, 

personnel and budget, but we perform a vital function in the international economic 

life of our country. It is the role of the FMC, through its regulatory powers, to assist all 

segments of our waterborne commerce -- vessels, ports, support industries, labor both 

on board our ships and on our terminals, truckers and railroads -- in regaining their 

economic vitality and jobs when the economic upturn comes. To this end, we will soon 

announce a new “green” initiative to facilitate employment through environmental 

improvements in the industry. We strive to accomplish our goals even as the shipping 

industry and the shipping public grapple with the impact of the recent economic 

downturn, described recently as “the worst year in modern maritime history.” 

The FMC’s Performance and Accountability Report (PAR) for fiscal year 2009 is hereby presented. Our PAR 

enables industry participants and the general public to become more aware of the Commission’s ongoing efforts 

and successes in the regulation of the shipping industry. It provides the results of our program performance and 

successful financial activities over the past year that support our mission to foster a fair, efficient and reliable 

international ocean transportation system and to protect the public from unfair and deceptive practices. The 

agency’s strategic goals regarding efficient regulatory process, compliance, balanced enforcement, technological 

efficiencies and management capabilities form the core of our mission. 

This Report covers the Commission’s efforts in fiscal year 2009 to foster an equitable, secure, and market-driven 

ocean transportation industry. Fiscal year 2009 was the first year in which the FMC undertook quantitative 

measurement of performance goals, employing measures and targets. As such, these performance measures and 

targets stand alone and are not compared to past years. The Commission’s actual performance in fiscal year 2009 

is compared with the targeted levels of performance established in the agency’s Fiscal Year 2009 Final Annual 

Performance Plan. During the fiscal year, the agency focused on twenty-one performance goals, while many of 

the Commission’s resources were also dedicated to its various ongoing day-to-day activities. 

The fiscal year 2009 independent financial audit resulted in the FMC’s sixth consecutive unqualified opinion, the 

best audit opinion available. The independent auditors did not identify any material weaknesses, significant 

deficiencies, or instances of non-compliance with laws and regulations. In the Management Assurances section 

(see page 13), I provide my assurances that the FMC has no material weaknesses to report. I am also pleased to 

report that the FMC financial and performance data presented in this Report are complete, reliable, and accurate in 

keeping with the guidance from the Office of Management and Budget. 

In fiscal year 2009, the FMC endeavored to make the most productive use of its resources and was commended for 

those efforts. We received the 2009 Most Improved Small Agency Award, presented at a ceremony hosted by the 

Partnership for Public Service to recognize the 2009 Best Places to Work in the Federal Government. The agency 

ranked first among 31 other small agencies in the Best-in-Class scored areas of Strategic Management, Pay and 

Benefits, Performance Based Rewards and Advancement, Training and Development, and Support for Diversity. 

The Commission is extremely proud of this accomplishment. 

I look forward to working with agency staff, my fellow Commissioners and FMC stakeholders to continue 

providing high quality service to the American public. 

Sincerely, 

Richard A. Lidinsky, Jr. 

Chairman 

November 16, 2009 

A Message from the Chairman 
 1 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 

FEDERAL MARITIME COMMISSION

MANAGEMENT’S DISCUSSION and ANALYSIS 

Fiscal Year 2009 
FEDERAL MARITIME 

COMMISSION 

 1

Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Introduction 

This Performance and Accountability Report (Report or PAR) represents the completion of the Federal Maritime 

Commission’s program and financial management process for fiscal year (FY) 2009, which began with mission 

and program planning, continued with the formulation and justification of FMC’s budget submission to the 

President and Congress, through budget execution, and ended with a report of our program performance and the 

use of resources. This report was prepared pursuant to the requirements of the Chief Financial Officers Act, as 

amended by the Reports Consolidation Act, and the Office of Management and Budget (OMB) Circular No. A136, Financial Reporting Requirements (Revised 6/10/09), and covers the Commission’s activities from October 1, 

2008 through September 30, 2009. 

Chapter One provides an overview of the FMC. It consists of eight sections: Introduction describes the agency, its 

mission and structure; Regulatory Responsibility describes its regulatory mandate; Future Challenges includes 

information about the changes in the maritime industry; Program Performance Overview reports on the FMC’s 

success in achieving its strategic goals; President’s Management Agenda describes activities related to the relevant 

initiatives; Financial Performance Overview discusses the FMC’s financial position and audit results; Financial 

Statement Highlights gives an overview of the major financial statements; and Systems, Controls, and Legal 

Compliance discloses the FMC’s compliance with certain legal and regulatory requirements. 

About the FMC 

The FMC is an independent transportation/trade regulatory agency which administers the Shipping Act of 1984 

(1984 Act or Shipping Act) as amended by the Ocean Shipping Reform Act of 1998 (OSRA); section 19 of the 

Merchant Marine Act, 1920 (1920 Act); the Foreign Shipping Practices Act of 1988 (FSPA); and Public Law 

(P.L.) 89-777 (passenger vessel certification). The Commission: monitors the activities of ocean common carriers, 

marine terminal operators, conferences, ports and ocean transportation intermediaries (non - vessel - operating 

common carriers and ocean freight forwarders) who operate in the U. S. foreign commerce to ensure they maintain 

just and reasonable practices; maintains a trade monitoring and enforcement program designed to assist regulated 

entities in achieving compliance and to detect and appropriately remedy malpractices and violations of the 

prohibited acts set forth in section 10 of the 1984 Act; monitors the laws and practices of foreign governments 

which could have a discriminatory or otherwise adverse impact on shipping conditions in U. S. trades, and imposes 

remedial action as appropriate pursuant to section 19 of the 1920 Act or FSPA; enforces special regulatory 

requirements applicable to carriers owned or controlled by foreign governments; processes and reviews 

agreements, service arrangements and service contracts pursuant to the 1984 Act for compliance with statutory 

requirements; and reviews common carriers’ privately published tariff systems for accessibility and accuracy as 

required by OSRA. The Commission also issues licenses to qualified ocean transportation intermediaries (OTIs) in 

the U.S., ensures that all OTIs are bonded or maintain other evidence of financial responsibility, and ensures that 

passenger vessel operators (PVOs) demonstrate adequate financial responsibility in case of nonperformance or 

injury to passengers. 

Organization 

The FMC is composed of five Commissioners appointed for five-year terms by the President with the advice and 

consent of the Senate. No more than three members of the FMC may belong to the same political party. The 

President designates one of the Commissioners to serve as Chairman. The Chairman is the chief executive and 

administrative officer of the agency. The FMC’s organizational units consist of: Offices of the Commissioners; 

Office of the General Counsel (OGC); Office of the Secretary (OS), including the Library and Office of Consumer 

Affairs and Dispute Resolution Services (CADRS); Office of Administrative Law Judges (ALJ); Office of Equal 

Employment Opportunity (EEO); Office of the Inspector General (OIG); Office of Operations (OPs), including the 

Area Representatives (ARs), Bureaus of Certification and Licensing (BCL), Enforcement (BOE), and Trade 

Analysis (BTA); and Office of Administration (OA), including the Offices of Financial Management (OFM), 

Human Resources (OHR), Information Technology (OIT), and Management Services (OMS). The majority of 

FMC personnel are located in Washington, DC, with ARs in New York, New Orleans, Los Angeles, Seattle, 

Houston and South Florida. 
Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Office of Equal

Employment

Opportunity

Office of the

Inspector General

Office of the

Secretary

Office of

Operations

Office of

Administration

Office of the

General Counsel

Commissioner

(Vacant)

Commissioner

(Dye)

Chairman

(Lidinsky)

Commissioner

(Brennan)

Commissioner

(Vacant)

Bureau of

Certification

 and Licensing

Bureau of

Enforcement

Bureau of Trade

Analysis

Office of

Administrative

Law Judges

Office of

Consumer Affairs

and Dispute

Resolution

Services

Area

Representatives

New York

Los Angeles

Houston

New Orleans

Seattle

South Florida

Office of Financial

Management

Office of Human

Resources

Office of

Information

Technology

Office of

Management

Services

Organization Chart 

(as of September 30, 2009) 

 2 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 3

Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Regulatory Responsibility 

The Commission’s principal regulatory responsibilities include: 

• Reviewing agreements among ocean common carriers and marine terminal operators (MTOs) relating to 

service in the U.S. foreign oceanborne trades, to ensure that they do not cause substantial increases in 

transportation costs or decreases in transportation services. 

• Reviewing service contracts between ocean common carriers and shippers to guard against detrimental effects 

to shipping in the U.S. foreign trades. 

• Ensuring that common carriers’ tariff rates and charges are accessible to the shipping public in private, 

electronically accessible systems. 

• Regulating rates, charges, and rules of government-owned or -controlled carriers to ensure that they are just 

and reasonable. 

• Issuing passenger vessel certificates evidencing financial responsibility of vessel owners or charterers to pay 

judgments for personal injury or death, or to refund passenger fares for the nonperformance of a voyage or 

cruise. 

• Licensing OTIs in the U.S. to protect the public from unqualified, insolvent, or dishonest companies. 

• Ensuring that OTIs maintain sufficient financial responsibility to protect the shipping public from financial 

loss. 

• Protecting the shipping public against economic harm by investigating rates, charges, classifications, and 

practices of common carriers, MTOs, and OTIs operating in the foreign commerce of the U.S.

• Taking action to address unfavorable conditions arising out of foreign government or business practices in the 

U.S. foreign shipping trades. 

The FMC is authorized by the FSPA, the 1920 Act, and 1984 Act as amended by OSRA to take action to ensure 

that the foreign commerce of the U.S. is not burdened by non-market barriers to ocean shipping. The FMC may 

take countervailing action to correct unfavorable shipping conditions in U.S. foreign commerce and may impose 

penalties. The FMC may address actions by carriers or foreign governments that adversely affect shipping in the 

U.S. foreign oceanborne trades including the intermodal operations of carriers or the operations of OTIs, or that 

impair access of U.S.-flag vessels to ocean trade between foreign ports. 

The 1984 Act is applicable to the operations of common carriers and other persons engaged in U.S. foreign 

commerce. It exempts agreements that have become effective under the 1984 Act from the U.S. antitrust laws, as 

contained in the Sherman and Clayton Acts. The FMC reviews and evaluates agreements to ensure that they do 

not exploit the grant of antitrust immunity, and to ensure that agreements do not otherwise violate the 1984 Act or 

result in an unreasonable increase in transportation cost or unreasonable reduction in service. 
Regulatory Responsibility (continued)

In addition to monitoring relationships among carriers, the FMC is also responsible for ensuring that individual 

carriers, as well as those permitted by agreement to act in concert, fairly treat shippers and other members of the 

shipping public in accordance with the 1984 Act’s prohibition against undue discrimination. The 1984 Act also 

requires all carriers to make their rates, charges and practices available in automated tariff systems that must be 

available electronically to the public. Non-vessel-owning common carriers (NVOCCs) may assess the rates and 

charges published in their tariffs or may offer service arrangements with shipping customers. Ocean common 

carriers are permitted to enter into service contracts with their shipper customers. Such contracts are filed 

electronically with the FMC in our Internet-based system, and are provided confidential treatment by the FMC as 

required by the Act. The FMC does not have the authority to approve or disapprove general rate increases (GRIs) 

or individual commodity rate levels in the U.S. foreign commerce, except with regard to certain foreign 

government-owned or -controlled carriers. 

Public Law 89-777 requires the operators of passenger vessels with 50 or more berths who embark passengers at 

U.S. ports to establish financial coverage to indemnify passengers in cases of death, injury, or nonperformance of 

transportation. The FMC certifies such operators upon the submission of satisfactory evidence of financial 

responsibility. The FMC ensures that all OTIs operating in the foreign commerce of the U.S. have established 

sufficient financial responsibility to protect shippers from financial loss. Additionally, the FMC licenses all U.S. 

OTIs. 

The FMC carries out its regulatory responsibilities by conducting informal and formal investigations. It holds 

hearings, considers evidence and renders decisions, and issues appropriate orders and implementing regulations. 

The FMC also adjudicates and mediates disputes involving the regulated community, the general shipping public, 

and other affected individuals or interest groups. 

The FMC also carries out a management and support function for information technology, financial management, 

human resources, and administrative support. 

The FMC oversees approximately 6,000 regulated persons (passenger vessel operators, vessel-owning common 

carriers, marine terminal operators, conferences, OTIs, etc.). 

Future Challenges 

International trade continues to be dependent upon an efficient ocean transportation system. The ocean shipping 

industry faces significant challenges related to port and maritime security, port congestion, industry consolidation 

and dynamic economic conditions. As the industry restructures to adapt to these changes, it is imperative for the 

FMC to ensure that its oversight produces a competitive trading environment in U.S. ocean commerce that is in 

harmony with, and responsive to, international shipping practices, and fosters an equitable, secure, and marketdriven ocean transportation industry. 

The Commission continues to review its regulatory initiatives to ensure that agency resources are maximized to 

accomplish statutory obligations with a minimum of government intervention and regulatory cost. 

Cooperative working arrangements with front-line security agencies remain in place. Effective use of emerging 

information technologies continue to facilitate our efforts to allow greater collaboration both internally and with 

other government agencies, and to allow greater information transparency and accessibility to the public. 

Chapter One 

 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

 4 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 5

Program Performance Overview 

The FMC, like other Federal agencies, provides an annual performance plan to Congress, pursuant to the 

Government Performance and Results Act (GPRA). The FMC has organized its performance goals to achieve its 

strategic goals. The FMC’s final Annual Performance Plan for FY 2009 is available on the FMC’s website. The 

complete FY 2009 Program Performance Report is contained in Chapter 2, Program Performance. In FY 2009, 

the Commission continued to refine the agency’s business practices, specifically on revising and updating internal 

procedures in line with the amendment of Commission regulations. This includes facilitating the use and 

dissemination of filed material in order to improve analysis of required filings and responsiveness to inquiries, and 

implementation of procedural changes to enhance the effectiveness of agency operations. We broadened our efforts 

to implement the President’s Management Agenda initiative to expand electronic government by increasing 

transparency and improving the management of information through the more effective use of available 

technologies. We also streamlined the delivery of services and information to regulated entities, other government 

agencies and the public, and further automated agency systems and enhanced the use of agency databases to allow 

staff to discharge program responsibilities more effectively. 

Achieving Strategic Goal Results 

The FMC has a distinct process for measuring performance. Performance goals are developed to promote each of 

the FMC’s strategic goals, and the processes or activities required to achieve the goals are identified. The agency 

then specifies the outcomes it believes will result from accomplishing each stated goal, and agrees on performance 

indicators as the quantifiers of performance. Fiscal year 2009 was the first year in which the FMC undertook to 

quantitatively establish and measure performance goals. As such, these FY 2009 performance measures and targets 

stand alone and are not compared to past years. The Commission’s actual performance in FY 2009 is compared 

with the targeted levels of performance established in the agency’s FY 2009 Final Annual Performance Plan. 

Taken together, performance measures and targets under each strategic goal are designed to enhance and further 

those goals each fiscal year, bringing the agency closer to its ideal of full achievement of its strategic goals. Our 

experience in establishing 2009 targets enabled us to set more realistic targets for the FY 2010—2015 Strategic 

Plan. 

President’s Management Agenda 

The President’s Management Agenda (PMA) is intended to make Government more citizen-centered, resultsoriented, and market-based. The five initiatives are: 1) Strategic Management of Human Capital; 2) Competitive 

Sourcing; 3) Improved Financial Management, 4) Expanded E-Government, and 5) Budget and Performance 

Integration. The FMC has achieved some successes in its agenda to address these initiatives. Chapter 2, Program 

Performance, discusses our activities in these important areas in more detail. 

A brief overview of the agency’s successes includes the following: 

Strategic Management of Human Capital – The FMC continued to focus on workforce and succession planning 

during FY 2009. The Commission finalized its Human Capital Plan, Workforce Plan, and Accountability and 

Succession Management Plans in accordance with OPM’s Human Capital Assessment and Accountability 

Framework. 

Results from the 2008 Federal Human Capital Survey indicate that FMC employees like the work they do and 

believe the Commission does a good job in the areas of recruitment, employee development, and retention. The 

rate of positive responses by FMC employees exceeded the government-wide average in all but 3 of the 74 

questions included in the survey. The FMC’s highest scores were in the area of employee benefits and support for 

work/life balance. 

To promote health and safety in the workplace, the Commission implemented an Automatic External Defibrillator 

Program during FY 2009. Training on the equipment was provided to 28 members of the agency’s Emergency 

Response Team. 

Chapter One 

 

 MANAGEMENT’S DISCUSSION and ANALYSIS 
Chapter One 

 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

President’s Management Agenda (continued)

Competitive Sourcing - The FMC submitted its FY 2009 Federal Activities Inventory Reform Act (FAIR Act)

Inventory to OMB in June 2009. The Inventory identified 78 of the agency’s 132 FTEs as commercial activity 

FTEs. No challenges to its commercial inventories have ever been received. 

Improved Financial Performance - For the sixth straight year, the FMC received an unqualified opinion on its 

financial statements in FY 2009. The FMC will continue to strive to achieve unqualified audit opinions. 

Expanded E-Government -The FMC continues to expand electronic government (e-government). During FY 

2009, the FMC increased the number of key documents filed in formal docketed proceedings available to the 

public on the agency’s website, as well as completed a large volume project. The entire collection of historical 

Commission decisions issued in its adjudicatory proceedings are now available on the agency’s website. During 

FY 2009, the Commission continued to modernize and expand the Regulated Persons Index (RPI), a database 

containing up-to-date records of licensed OTIs, ocean common carriers and other entities, and an enterprise 

content management project was also initiated to integrate FMC databases, address business workflow and 

document and records management needs. 

Work continued on automating the submission and application process for certain FMC forms used by regulated 

entities. The Commission met OMB’s mandate to have desktop systems Federal Desktop Core Configuration 

(FDCC) compliant. The agency also provided additional content on its Intranet for the use of FMC staff. 

Senior managers are aware of the requirements and benefits of e-government, and continue to plan and initiate 

program changes to expand the use of e-government in daily activities. Employees are required to complete online information technology security refresher training on an annual basis. The FMC continues to upgrade its 

network infrastructure and to provide a high-quality information technology program for its staff. The agency is 

committed to continuing its integration of information technology policies and procedures, and to expand 

opportunities for e-government activities. In FY 2009, the agency resolved several significant deficiencies related 

to its information technology program; the deficiencies were identified in earlier Federal Managers’ Financial 

Integrity Act (FMFIA) Reports. 

Budget and Performance Integration – The Strategic Plan and Annual Performance Plan continue to represent 

the fundamental framework for the agency’s planning and budgeting activities. Funding and Full Time Equivalent 

(FTE) levels are integrated into the agency’s performance planning document by strategic goal, to identify clearly 

the budgetary and staff resources that are committed to each goal. 

Financial Performance Overview 

As of September 30, 2009, the financial condition of the FMC was sound with respect to having sufficient funds to 

meet program needs and adequate control of funds in place to ensure obligations did not exceed budget authority. 

The FMC’s accounting services provider, the Bureau of the Public Debt (BPD), prepared the agency’s financial 

statements in accordance with accounting standards codified in the Statements of Federal Financial Accounting 

Standards and OMB Circular A-136. 

 6 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 7

Chapter One 

 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Source of Funds and Appropriation History 

The FMC has a single source of funds, Salaries and Expenses, funded by an annual appropriation that is available 

for commitments and obligations incurred during the fiscal year in which the authority was granted. The FMC’s 

total new budget authority for FY 2009 was $22,800,000. This represents a net increase in budget authority of 

$728,000 over FY 2008. Although the FMC collects remittances for user fees and penalties, the agency is not 

authorized to offset any of its budget authority by utilizing these funds. The collections are deposited directly into 

the Treasury General Fund, and captured in the Statement of Custodial Activity which can be found in Chapter 3, 

Auditor’s Reports and Financial Statements.

Full-time Equivalent History 

 

The FMC’s Full-time Equivalent (FTE) level is largely driven by our annual appropriation level and the actual 

FTE level has fluctuated since 1999. After a decline in 2001, the FMC experienced modest growth in its FTE level 

through 2004, followed by an annual decline through 2008. The level increased again in 2009. For the past several 

years, unanticipated vacancies in the Offices of the Commissioners have remained unfilled. The agency has 

endeavored to develop the appropriate mix of staffing and other available means to ensure the effective 

accomplishment of our mission. 
Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Uses of Funds by Expense Category 

In FY 2009, the FMC incurred new obligations of $22.8 million, which was a $1.1 million increase over FY 2008. 

FY 2009 obligations represent 99.7% of the budget authority. Of the total obligations, 67.8% was used for salaries 

and benefits, .9% was used for Commission travel expenses, and the remaining 31.3% was used for administrative 

expenses (e.g., rent, government and commercial contracts, furniture, printing, and equipment maintenance). The 

un-obligated authority balance of $66,284 will remain active for four years to service FMC-established 

requirements. 

Audit Results 

The FMC again received an unqualified opinion on its FY 2009 financial statements from the auditing firm of 

Dembo, Jones, Healy, Pennington & Marshall, P.C. under contract through the FMC’s OIG. Comparative 

statements are located in Chapter 3, Auditor’s Reports and Financial Statements. 

Financial Statement Highlights 

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

Commission pursuant to the requirements of 31 U.S.C. 3515(b). While the statements have been prepared from the 

books and records of the Commission in accordance with the formats prescribed by OMB, the statements are in 

addition to the financial reports used to monitor and control budgetary resources which are prepared from the same 

books and records. The statements should be read with the realization that they are for a component of the U.S. 

Government, a sovereign entity. One implication of this is that liabilities cannot be liquidated without legislation 

that provides resources to do so. 

The FMC’s financial statements summarize the financial position and financial activity of the agency. The 

financial statements, footnotes, and the remainder of the required supplementary information appear in their 

entirety in Chapter 3, Auditor’s Report and Financial Statements. A brief analysis of the principal statements 

follows. 

15,415

212

7,106

14,380

231

7,013

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Salaries & Expenses Travel Administrative

Utilization of Funds by Expense Categories

($000s)

FY 2009 FY 2008

Table A

 8 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 9

Analysis of the Balance Sheet 

The FMC’s assets in FY 2009 were 

$5,050,396 as of September 30, 2009. This 

represents an increase over FY 2008 of 

$921,571. The FMC’s assets reported in the 

balance sheet are summarized in the 

accompanying table. 

The Fund Balance with Treasury of 

$4,777,674 represents the FMC’s largest asset 

as of September 30, 2009 and represents 

94.6% of the agency’s total assets. This is an 

increase of 17.6% over FY 2008. The Fund 

Balance with Treasury is comprised only of annual appropriations maintained by the Department of the Treasury 

to address current liabilities. 

Accounts Receivable as of September 30, 2009 was $70,222 and accounts for 1.4% of the FMC’s total assets. 

This is a 8.7% increase over FY 2008. 

Capital Assets, also known as Property, Plant and Equipment, accounts for 4% of the FMC’s total assets as of 

September 30, 2009. The Net value of $202,500 accounts for the depreciation of all assets and represents the 

current book value of those assets. 

The FMC’s Liabilities totaled $2,715,904 as 

of September 30, 2009. The accompanying 

table depicts an increase of $263,868 total 

liabilities over FY 2008. Accounts Payable 

represents the total goods and services 

received by the FMC as of September 30, 

2009. The FMC has not yet received invoices 

from the numerous vendors as of the close of 

FY 2009. Federal Employee Benefits 

represents accrued salaries and liabilities that 

are not funded by budgetary resources. These 

liabilities represent future workers’ 

compensation and accrued annual leave that 

remains on the books. The Federal budget process does not recognize future benefits for today’s employees; 

however, these liabilities will be recognized in future budget cycles as they are paid. 

Net Position is the difference between total 

assets and total liabilities. The total net 

position for FY 2009 is an increase of 

$657,703 from FY 2008. Unexpended 

Appropriations represents the total authority 

granted by Congress that the FMC has not 

expended as of September 30, 2009. 

Cumulative Results of Operations represents 

the net results of all operations of the FMC. 

Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

FY 2009 FY 2008 

Fund Balance with Treasury $4,777,674 $4,062,134 

Accounts Receivable $70,222 $64,579 

Capital Assets $202,500 $2,112 

Other 0 0 

Summary of Assets as of September 30, 2009 

Total Assets $5,050,396 $4,128,825 

Summary of Liabilities as of September 30, 2009 

FY 2009 FY 2008 

Accounts Payable $541,102 $310,274 

Payroll Taxes Payable $156,036 $130,152 

Accrued Liabilities $1,948,720 $1,947,207 

Total Liabilities $2,715,094 $2,451,226 

Federal Employee Benefits $ $ 

Custodial Liability $69,236 $63,593 

Net Position Summary as of September 30, 2009 

FY 2009 FY 2008 

Unexpended Appropriations $3,214,566 $2,706,788 

Cumulative Results ($879,264) ($1,029,189) 

Total Net Position $2,335,302 $1,677,599 
Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Analysis of Net Cost 

The analysis of Net Cost presents the net cost 

of FMC’s five Commission Programs as 

identified in the FMC’s Annual Report. The 

five agency programs are Formal Proceedings, 

Inspector General, Equal Employment 

Opportunity, Operations, and Administration. 

The Statement of Net Costs shows the net cost 

of operations for the agency as a whole and its 

sub-organizations and/or programs. Net Costs 

compared to Budgetary Resources can be 

found in Chapter 3, Auditor’s Report and 

Financial Statements. 

Analysis of the Statement of Changes in Net Position 

The Statement of Changes in Net Position, found on page ten, reports the change in the agency’s net position 

during the reporting period. The statement is a summary of two factors, Unexpended Appropriations and 

Cumulative Results in Operations. The increase of $657,703 from FY 2008 to FY 2009 is due principally to the net 

change in Cumulative Results of Operations due to further depreciation of Capital Assets and an increase in 

unexpended appropriations. 

Analysis of the Statement of Budgetary Resources 

 The Statement of Budgetary Resources 

(SBR) shows the source of the agency’s 

budgetary resources and the status of those 

resources at the end of the reporting period. 

The statement also shows the relationship 

between budgetary resources and the status 

of the resources. The total budgetary 

resources must be equal to the status of 

budgetary resources at all times. A more 

detailed SBR can be found in Chapter 3, 

Auditor’s Report and Financial Statements. 

For FY 2009, the FMC had total budgetary 

resources available of $23,685,439. This 

represents a 5.6% increase over FY 2008 

budgetary resources available of 

$22,438,514. For FY 2009, the FMC 

incurred obligations of $22,817,981, 

representing 96.3% of available funding. 

The majority of the unobligated balance of 

$66,284 represents funding for travel that was not utilized. 

 Summary of the Statement of 

Net Cost as of September 30, 2009 

FY 2009 FY 2008 

Office of Administration $6,237,122 $6,088,432 

Office of Equal Employment 

Opportunity 

$151,287 $161,903 

Net Cost of Program Services $23,305,673 $22,015,432 

Office of Inspector General $529,935 $597,799 

Formal Proceedings $6,082,905 $5,627,251 

Office of Operations $10,304,424 $9,540,047 

 Summary of the Statement of Budgetary Resources as of 

September 30, 2009 

FY 2009 FY 2008 

Total Budgetary Resources $23,685,439 $22,438,514 

Obligations Incurred $22,817,981 $21,690,849 

Status of Budgetary Resources $23,685,439 $22,438,514 

Unobligated Balance $66,284 $447,579 

Unobligated Balance Not Available $801,174 $300,086 

 10 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 11

Systems, Controls, and Legal Compliance 

This section provides information on FMC’s compliance with the: 

Federal Managers’ Financial Integrity Act 

Prompt Payment Act 

Debt Collection Improvement Act 

Biennial Review of User Fees 

Performance Measure Summary 

Inspector General Act 

Federal Managers’ Financial Integrity Act 

The Federal Managers’ Financial Integrity Act (FMFIA) requires that agencies establish controls that reasonably 

ensure that obligations and costs comply with applicable law; assets are safeguarded against waste, loss, 

unauthorized use, or misappropriation; and revenues and expenditures are properly recorded and accounted for. It 

requires the agency head to provide an assurance statement of the adequacy of management controls and 

conformance of financial systems with Government standards. 

The Chairman has provided his annual assurance statement on the following page. This statement was based on 

various sources and included management knowledge gained from the daily operation of agency programs and 

reviews, discussions with senior managers who together comprise the agency’s Senior Policy Group, audits of 

financial statements, annual performance plans, and OIG reports, among other sources. The Senior Policy Group is 

comprised of all SES-level senior executives, including the Director of Operations and General Counsel, among 

others. Additionally, the Chairman meets regularly with, and receives regular reports from, the FMC’s OIG. 

Management control deficiencies, when identified, are addressed at the highest management levels within the 

agency. For instance, corrective actions for significant deficiencies identified in the agency’s information 

technology area are overseen directly by the agency’s Chief Information Officer (CIO). 

During the fiscal year, the IG identified no significant deficiencies and there were no significant management 

decisions made on which the IG disagreed. A significant deficiency concerning Certification and Accreditation 

(C&A) documentation identified in the information technology program during FY 2008 was resolved. 

Management and the OIG reached agreement on all recommendations made, although at the conclusion of the 

fiscal year, 25 recommendations remained open, i.e., management and the OIG agree as to the action that 

management needs to take, but management has not yet taken the action to close the recommendations. 

Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 
Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Debt Collection Improvement Act

The Debt Collection Improvement Act enhances the ability of the Government to service and collect debts. The 

Act centralized the collection of non-tax delinquent debt owed to the Government. The collection of delinquent 

debts is conducted by the Financial Management Service through the Treasury Offset Program where the names 

and taxpayer identification numbers (TIN) are matched against the TINs of recipients of Government payments. 

The balance owed the Government is deducted or offset from the payment to the entity to satisfy the debt. All 

Office of Personnel Management (OPM) retirement, vendor, Internal Revenue Service refunds, Social Security 

Benefits, and some Federal salary payments are being offset. Federal agencies are required to refer delinquent 

accounts in excess of 180 days to Treasury for collection. The goal of the FMC is to minimize the amount of 

delinquent debt owed to the agency. 

Prompt Payment Act 

The Prompt Payment Act requires agencies to make timely payments to vendors for supplies and services, to pay 

interest penalties when payments are made after the due date, and to take cash discounts when they are 

economically justified. In FY 2009, the FMC maintained a percentage of on-time payments at 97.54%. The FMC 

paid eight invoices totaling $19,015.00 late due to certification delays from the COTRs. Interest payments totaling 

$27.11 were paid on three of the invoices. The FMC will continue to strive towards 100% on-time payments in 

future years. The FMC has maintained a 100% on-time electronic/credit-card payment to its vendors. 

Biennial Review of User Fees 

The Chief Financial Officers Act requires that agencies conduct a biennial review of fees and other charges 

imposed by agencies, and to make revisions to cover program and administrative costs incurred. During FY 2008, 

the Commission completed its biennial review of user fees, and the OIG subsequently conducted a review of the 

methodology used to calculate the updated user fees. During the review, the OIG determined that the agency 

followed a process which incorrectly set user fees for various mission-related services, resulting in user fees that 

understated the agency’s costs to provide these services. The new fee structure was not implemented during FY 

2009, and methodology for calculating new user fees remains under review. 

 12 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 13

Chapter One 

 MANAGEMENT’S DISCUSSION and ANALYSIS 

Performance Measure Summary 

The FMC does not have an in-house financial accounting system, and as a small agency does not receive a 

Performance Measure Summary from the Department of the Treasury. The agency receives travel, procurement, 

accounting and financial services from BPD located in Parkersburg, WV. The Commission verifies and reconciles 

all financial statements and reports prior to submission, and has remained in compliance with all reporting 

thresholds including FACTS I (Federal Agencies’ Centralized Trial-Balance System) reporting, timely reporting, 

and reconciliation of any financial statement differences. 

Inspector General Act 

The FMC continues to have a very good record in resolving and implementing audit recommendations presented in 

its OIG reports. Section 5(b) of the Inspector General Act requires agencies to report on final actions taken on 

OIG audit recommendations. 

Briefly, during FY 2009, the Inspector General completed the following audits and reviews: 

 

Audit of the FMC’s FY 2008 Financial Statements 

Management Letter to the FY 2008 Audited Financial Statements 

Review of the Bureau of Enforcement’s Time and Attendance Practices 

Operational Review – Inspection of the Agency’s Checkout Process 

Review of the Office of the General Counsel Time and Attendance Practices 

Review of the Bureau of Certification and Licensing Time and Attendance Practices 

Review of the Office of the Secretary Time and Attendance Practices 

Review of the Bureau of Trade Analysis Time and Attendance Practices 

Review of the Office of Consumer Affairs and Dispute Resolution Services Time and Attendance Practices 

The Inspector General’s reviews disclosed no instances of questioned costs. The agency addressed a number of 

recommendations from these reviews, and it is expected that the remaining open recommendations will be resolved 

during FY 2010. 

During FY 2009, no significant deficiencies were identified. The agency mitigated one significant deficiency 

which was identified in the FY 2008 FISMA Review regarding C&A documentation. 

FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 16

CHAPTER TWO

PROGRAM PERFORMANCE 

Fiscal Year 2009 

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Chapter Two 

 PROGRAM PERFORMANCE 

Annual Performance Report 

Introduction 

The FMC’s performance management system includes both strategic goals and performance goals and measures. 

The strategic goals represent the FMC’s mission and reflect the overall outcomes the agency is working to achieve. 

For FY 2009, the FMC focused on the following strategic goals: 

• Efficient Regulatory Process: 

Provide a timely, efficient and decisive regulatory process, including alternative dispute resolution, to enable all 

segments of the industry to operate more effectively, with a minimum of regulatory costs. 

• Compliance: 

Promote efficiency and fairness in U.S. foreign waterborne commerce through various means, including outreach 

and monitoring, to protect the public and assist stakeholders in achieving compliance with ocean transportation 

statutes administered by the FMC. 

• Balanced Enforcement: 

Foster economic efficiencies, reliance on marketplace factors and maritime security by administering U.S. shipping 

statutes in a balanced and equitable manner to redress excessive anticompetitive actions and other unlawful 

activities. 

• Technological Efficiencies: 

Employ technological enhancements to improve efficiency and to facilitate the exchange of information. 

• Management Capabilities: 

Ensure the FMC has the appropriate organizational framework and management systems to carry out its statutory 

mandates. 

This progress report covers the Commission’s efforts in FY 2009 to foster an equitable, secure, and market-driven 

ocean transportation industry. Fiscal year 2009 was the first year in which the FMC undertook quantitative 

measurement of performance goals, employing measures and targets. As such, these FY 2009 performance 

measures and targets stand alone and are not compared to past years. The Commission’s actual performance in FY 

2009 is compared with the targeted levels of performance established in the agency’s FY 2009 Final Annual 

Performance Plan. In FY 2009, the agency focused on twenty-one performance goals, while many of the 

Commission’s resources were also dedicated to its various day-to-day activities. 

Because FY 2009 was the FMC’s first year of measuring quantitative targets, the targets were set without historical 

benchmarks and in some instances proved to be overly aggressive. At the time the measures were developed, the 

FMC was anticipating gains in automation to be forthcoming in very short order. Those automation gains were not 

realized due to a variety of factors which have now lead the agency to embark on the development of a new 

enterprise content management system. The lag in automation of processes led in part to disappointments in some 

of the regulatory program areas. 

As well, some of the targets in this report that carry over to 2010 were revised downwards for 2010 as it was 

recognized soon into FY 2009 that certain targets were unreachable, such as the target for the time taken in the OTI 

licensing process. The FY 2009 targets represented ballpark ideals which proved to be aggressive but not viable 

given current resources and established business processes. For 2010 and beyond, our measures and targets are 

more reflective of desired strategic outcomes, less reflective of strictly internal processes and more realistic. 

 16 

CHAPTER TWO 

PROGRAM PERFORMANCE 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 17

Chapter Two 

 PROGRAM PERFORMANCE 

During fiscal year 2008, the Commission drafted a new Strategic Plan for 2010-2015 and in that process changed 

the manner in which it measures performance, setting performance goals directly linked to new strategic goals. 

This new plan includes a set of performance measures that will facilitate the evaluation of the FMC’s steady-state 

activities across several years. In updating the Strategic Plan and moving towards a new performance measurement 

system, the agency will increase its reporting of ongoing steady-state performance measures, and reduce its 

reporting of discrete performance measures designed to be completed in a year or less. 

The agency has forwarded this report to the President, with a copy to the Director, OMB, and appropriate 

Congressional committees. Additionally, this report has been placed on the FMC’s Internet web site to ensure that 

it is accessible to interested parties. All Commission employees have been advised to review it. Finally, it should 

be noted that the Commission does not participate in OMB’s Program Assessment Rating Tool (PART) program. 

Accordingly, no PART program evaluations were conducted during FY 2009. 
Chapter Two 

 PROGRAM PERFORMANCE 

Performance Measure Summary Tables 

Targeted performance compared to actual results. 

Strategic Goal 1: Efficient Regulatory Process 

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 1.1 Provide parties to proceedings with alternative means to resolve their disputes, including informal ADR, and encourage their use.

Measure: Disputes resolved by Office of Consumer Affairs and 

Dispute Resolution Services

 100 384

Outcome Goal 1.2 Conduct hearings in an expeditious and equitable manner, so that litigants and the industry can adjust their behavior accordingly.

Measure: Percentage of complaints or investigations completed 

within two years of filing or Commission initiation beginning 

with cases filed or initiated in FY 2007.

Target Unmet: A total of 9 such proceedings were initiated in 

2007, 5 of those were completed within two years. The pace of 

complaints and investigations is impacted by the ALJ’s and the 

Commission’s caseload, and the timeliness of submissions from 

outside parties.

60% 55%

Outcome Goal 1.3 Permit and encourage the use of electronic filings and other processes 

that result in less expense and timely resolution of disputes.

Measure: Percentage of Active Electronic Docket Logs updated 

within 72 hours of receipt of key documents issued or filed in 

Commission proceedings.

Target Unmet: This process was not tracked prior to FY 2009. 

Through tracking, inefficiencies on the front end of the current 

process were discovered. Modifications are underway to expedite the process.

85% 55%

Outcome Goal 1.4 Update Commission rules as appropriate to adjust to changes in the regulatory and commercial environment.

Measure: Number of rules pending in Unified Regulatory 

Agenda.

2 5

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 1.1 Provide parties to proceedings with alternative means to resolve their disputes, including informal ADR, and encourage their use.

Measure: Disputes resolved by Office of Consumer Affairs and 

Dispute Resolution Services

 100 384

Outcome Goal 1.2 Conduct hearings in an expeditious and equitable manner, so that litigants and the industry can adjust their behavior accordingly.

Measure: Percentage of complaints or investigations completed 

within two years of filing or Commission initiation beginning 

with cases filed or initiated in FY 2007.

Target Unmet: A total of 9 such proceedings were initiated in 

2007, 5 of those were completed within two years. The pace of 

complaints and investigations is impacted by the ALJ’s and the 

Commission’s caseload, and the timeliness of submissions from 

outside parties.

60% 55%

Outcome Goal 1.3 Permit and encourage the use of electronic filings and other processes 

that result in less expense and timely resolution of disputes.

Measure: Percentage of Active Electronic Docket Logs updated 

within 72 hours of receipt of key documents issued or filed in 

Commission proceedings.

Target Unmet: This process was not tracked prior to FY 2009. 

Through tracking, inefficiencies on the front end of the current 

process were discovered. Modifications are underway to expedite the process.

85% 55%

Outcome Goal 1.4 Update Commission rules as appropriate to adjust to changes in the regulatory and commercial environment.

Measure: Number of rules pending in Unified Regulatory 

Agenda.

2 5

 18 

CHAPTER TWO 

PROGRAM PERFORMANCE 
FEDERAL MARITIME 

COMMISSION 

 19

Chapter Two 

 PROGRAM PERFORMANCE 

Strategic Goal 2: Compliance 

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 2.1 Increase the rate of compliance under applicable U.S. shipping laws and 

regulations relating to tariffs, service contracts, unfair trade practices, antitrust immunity, discriminatory practices, carrier pricing and service, ocean transportation intermediary activities, 

and passenger vessel operations. 

Measure: Percentage of minutes and monitoring reports received 

within regulatory deadlines or formal extension. 

Target Unmet: Three different reporting requirements are encompassed in this measure and do not lend themselves to averaging as a 

collective unit. Of passenger vessel monitoring reports, 91% were 

filed on time. Follow-up with filers was impeded by staffing shortages in that office. For agreement minutes, 83% were received on 

time. 72% of quarterly monitoring reports for agreements were received timely. Increasing use of electronic submission rates should 

increase the rate of timeliness for minutes, as e-filed minutes were 

received more timely. However for quarterly monitoring reports, 

filers rely on a commercial data source that often publishes late.

Measure: Percentage of new and amended OTI applications that 

are processed with 45 days. 

Target Unmet: In FY 2009, 401 OTI licenses were issued by the 

Commission. The target of 45 days was an ambitious target based 

on program aspirations including anticipating the implementation 

of an automated application that would have significantly decreased processing time. Also, the target was set without historical 

benchmark data. In fact, in the agency’s Strategic Plan for Fiscal 

Years 2010-2015, this target was revised from 45 days to 90 days. 

The 45 day target was also based on several assumptions including 

a modest increase in the number of applications received, completion of an automated license application form that would build efficiencies for the applicant and the staff analyst both, and minimal 

staff turn-over. While application growth was indeed modest from 

FY 2008 to 2009, the number of applications received each year 

has increased from about 520 in FY 2004 to 759 in FY 2009. Staffing obstacles in FY 2008 and 2009 were significant with turnover 

at the office chief level and departures of senior staff. Also significant, since FY 2005, the Bureau has incrementally modified its licensing review procedures, deepening the examination of the qualifications of license applicants. In FY 2009, difficulties encountered 

in implementing a new automated application process forced us to 

suspend its development in favor of developing a new agency-wide 

enterprise content management system. The licensing program is 

currently under review at the staff level with an aim of streamlining 

and reducing its back log.

95% 

 

 

 

 

 

 

 

 

 

 

 

80% 

72-91%

5%

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 2.1 Increase the rate of compliance under applicable U.S. shipping laws and 

regulations relating to tariffs, service contracts, unfair trade practices, antitrust immunity, discriminatory practices, carrier pricing and service, ocean transportation intermediary activities, 

and passenger vessel operations. 

Measure: Percentage of minutes and monitoring reports received 

within regulatory deadlines or formal extension. 

Target Unmet: Three different reporting requirements are encompassed in this measure and do not lend themselves to averaging as a 

collective unit. Of passenger vessel monitoring reports, 91% were 

filed on time. Follow-up with filers was impeded by staffing shortages in that office. For agreement minutes, 83% were received on 

time. 72% of quarterly monitoring reports for agreements were received timely. Increasing use of electronic submission rates should 

increase the rate of timeliness for minutes, as e-filed minutes were 

received more timely. However for quarterly monitoring reports, 

filers rely on a commercial data source that often publishes late.

Measure: Percentage of new and amended OTI applications that 

are processed with 45 days. 

Target Unmet: In FY 2009, 401 OTI licenses were issued by the 

Commission. The target of 45 days was an ambitious target based 

on program aspirations including anticipating the implementation 

of an automated application that would have significantly decreased processing time. Also, the target was set without historical 

benchmark data. In fact, in the agency’s Strategic Plan for Fiscal 

Years 2010-2015, this target was revised from 45 days to 90 days. 

The 45 day target was also based on several assumptions including 

a modest increase in the number of applications received, completion of an automated license application form that would build efficiencies for the applicant and the staff analyst both, and minimal 

staff turn-over. While application growth was indeed modest from 

FY 2008 to 2009, the number of applications received each year 

has increased from about 520 in FY 2004 to 759 in FY 2009. Staffing obstacles in FY 2008 and 2009 were significant with turnover 

at the office chief level and departures of senior staff. Also significant, since FY 2005, the Bureau has incrementally modified its licensing review procedures, deepening the examination of the qualifications of license applicants. In FY 2009, difficulties encountered 

in implementing a new automated application process forced us to 

suspend its development in favor of developing a new agency-wide 

enterprise content management system. The licensing program is 

currently under review at the staff level with an aim of streamlining 

and reducing its back log.

95% 

 

 

 

 

 

 

 

 

 

 

 

80% 

72-91%

5%
Chapter Two 

 PROGRAM PERFORMANCE 

Outcome Goal 2.2 Conduct educational programs and provide opportunity for informal exchanges between our stakeholders and the Commission.

Measure: Number of industry entities invited to address Commission staff.

Measure: Presentation, panel participation and attendance by 

staff at trade conferences.

3 invites

 3 panels,

attendance

9 invites

41

Outcome Goal 2.3 Maintain fair competition in U.S. ocean commerce.

Measure: Achieve positive outcomes in matters for which formal 

request for additional information is made to parties of filed 

ocean common carrier or marine terminal operator agreements.

90% 100%

Outcome Goal 2.4 Protect the public and users of ocean transportation services from activities that violate the shipping statutes.

Measure: Number of investigations opened to address alleged 

harm to the public as a result of Shipping Act violations.

Target Unmet: 34 investigations were opened by the Commission’s Area Representatives to investigate alleged violations. Often when a potential violation is alleged or discovered, the potential respondent is compelled to come into compliance with the 

law without the need to open an official investigation. The Bureau of Enforcement’s audit program as well as the OTI licensing 

program has been successful in identifying potential violations 

and allowing entities to adjust their processes to come into compliance without the need for investigation.

50 34

 20 

CHAPTER TWO 

PROGRAM PERFORMANCE 
FEDERAL MARITIME 

COMMISSION 

 21

Strategic Goal 3: Balanced Enforcement 

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 3.1 Assure carriers do not exercise their antitrust immunity in a manner 

that results in unreasonable practices, rate increases or service decreases.

Measure: Percentage of rate agreements analyzed for 6(g) 

compliance.

Measure: Number of memoranda, special reports or studies 

on significant competition related issues.

100%

3 major 

reports

100%

3 major 

reports

Outcome Goal 3.2 Ensure that Commission actions are taken with appropriate consideration of their impact on the industry and users of transportation services, including 

small business considerations, and are directed at market-distorting activities.

Measure: Number of un-addressed comments received in 

rulemakings regarding SBREFA concerns.

0 0

Outcome Goal 3.3 Provide regulatory assistance and encourage voluntary compliance 

with shipping statutes and regulations through consistent industry outreach and education 

efforts.

Measure: Number of compliance presentations by staff to 

industry and shipping public.

3 12

Outcome Goal 3.4 Neutralize, or affirmatively address, restrictive trade practices of foreign governments.

Measure: Number of unresolved FSPA and Section 19 proceedings.No more 

than 2

1

Outcome Goal 3.5 Improve maritime security by curtailing unlawful participation in the 

U.S. ocean transportation system.

Measure: Identified unlicensed OTIs sent compliance warning letters.95% 100%

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 3.1 Assure carriers do not exercise their antitrust immunity in a manner 

that results in unreasonable practices, rate increases or service decreases.

Measure: Percentage of rate agreements analyzed for 6(g) 

compliance.

Measure: Number of memoranda, special reports or studies 

on significant competition related issues.

100%

3 major 

reports

100%

3 major 

reports

Outcome Goal 3.2 Ensure that Commission actions are taken with appropriate consideration of their impact on the industry and users of transportation services, including 

small business considerations, and are directed at market-distorting activities.

Measure: Number of un-addressed comments received in 

rulemakings regarding SBREFA concerns.

0 0

Outcome Goal 3.3 Provide regulatory assistance and encourage voluntary compliance 

with shipping statutes and regulations through consistent industry outreach and education 

efforts.

Measure: Number of compliance presentations by staff to 

industry and shipping public.

3 12

Outcome Goal 3.4 Neutralize, or affirmatively address, restrictive trade practices of foreign governments.

Measure: Number of unresolved FSPA and Section 19 proceedings.No more 

than 2

1

Outcome Goal 3.5 Improve maritime security by curtailing unlawful participation in the 

U.S. ocean transportation system.

Measure: Identified unlicensed OTIs sent compliance warning letters.95% 100%

Chapter Two 

 PROGRAM PERFORMANCE 
 22 

CHAPTER TWO 

PROGRAM PERFORMANCE 

Strategic Goal 4: Technological Efficiencies 

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 4.1 Streamline the Commission's work processes through effective utilization of information technology.

Measure: The number of technology solutions that are designed and implemented and used by the Commission to facilitate process improvement through the use of databases and 

record keeping systems.

Target Unmet: During FY 2009, the decision was made to 

change the technology underlying our application development. A contract was recently awarded for enterprise content 

management and three new applications under development 

to facilitate process improvements are anticipated in FY 2010, 

with others phased in over the coming years.

Measure: Cumulative number of technology solutions that 

are designed and implemented and used by the Commission 

to facilitate process improvement through the use of databases and record keeping systems since FY 2007 (including 

current fiscal year).

Target Unmet: During FY 2009, the decision was made to 

change the technology underlying our application development. A contract was recently awarded for enterprise content 

management and three new applications under development 

to facilitate process improvements are anticipated in FY 2010, 

with others phased in over the coming years.

6

12

0

0

Outcome Goal 4.2 Use electronic technology for the receipt of documents filed with the 

Commission as envisioned by the Government Paperwork Elimination Act (GPEA).

Measure: Percentage use of electronically submitted forms 

by regulated concerns versus receipt of traditional paperdriven applications and processes.

50% 95%

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 4.1 Streamline the Commission's work processes through effective utilization of information technology.

Measure: The number of technology solutions that are designed and implemented and used by the Commission to facilitate process improvement through the use of databases and 

record keeping systems.

Target Unmet: During FY 2009, the decision was made to 

change the technology underlying our application development. A contract was recently awarded for enterprise content 

management and three new applications under development 

to facilitate process improvements are anticipated in FY 2010, 

with others phased in over the coming years.

Measure: Cumulative number of technology solutions that 

are designed and implemented and used by the Commission 

to facilitate process improvement through the use of databases and record keeping systems since FY 2007 (including 

current fiscal year).

Target Unmet: During FY 2009, the decision was made to 

change the technology underlying our application development. A contract was recently awarded for enterprise content 

management and three new applications under development 

to facilitate process improvements are anticipated in FY 2010, 

with others phased in over the coming years.

6

12

0

0

Outcome Goal 4.2 Use electronic technology for the receipt of documents filed with the 

Commission as envisioned by the Government Paperwork Elimination Act (GPEA).

Measure: Percentage use of electronically submitted forms 

by regulated concerns versus receipt of traditional paperdriven applications and processes.

50% 95%

Chapter Two 

 PROGRAM PERFORMANCE 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 23

Chapter Two 

 PROGRAM PERFORMANCE 

Outcome Goal 4.3 Safeguard programs and systems as required by the Federal Information 

Security Management Act of 2002 (FISMA).

Measure: Number of technology-related programs and systems 

developed or implemented that achieve full compliance with Federal information security mandates.

Target Unmet: Relationship with contractor awarded project severed after work requested was becoming costly and not helpful to 

the agency’s target goal.

12 2

Outcome Goal 4.4 Disseminate Commission and staff issuances through the use of electronic 

technology.

Measure: The total number of visits and downloads from agency 

website. Measured against previous year website traffic statistics,

FY 2007 - 2009.

10%

increase

29% 

 increase
Chapter Two 

 PROGRAM PERFORMANCE 

Strategic Goal 5: Management Capabilities 

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 5.1 Organize and manage the agency's staff consistent with established priorities, with an emphasis on workforce planning, diversity, and effective internal communication.

Measure: Percentage of agency employees who participated in 

required annual training during the fiscal year (e.g., ethics, IT 

security, No FEAR, etc.).

Measure: Number of awareness, recruitment, training, newemployee orientation, workforce development, and quality of life 

initiatives offered to agency employees.

Target Unmet: Fewer offerings were made to employees than 

anticipated.

100%

250

100%

216

Outcome Goal 5.2 Clearly and accurately communicate the Commission program requirements, activities and decisions in a manner consistent with the Information Quality Guidelines for Federal Agencies.

Measure: Percentage of internal Commission orders or SOPs 

reviewed, developed or updated by Office of Administration during the fiscal year.

Measure: Percentage of agency records which have been assessed with respect to records disposition requirements with respect to the current fiscal year.

33%

33%

69%

65%

Outcome Goal 5.3 Respond to changing industry conditions and business environment 

through use of state-of-the-art automated systems for internal and external processes and a 

flexible and well-trained workforce.

Measure: Percentage of agency employees who participated in 

optional skill-building, management and other training during 

the current fiscal year.

Measure: Percent of payments (user fees, penalties, etc.) received electronically via Pay.gov versus older technologies (e.g., 

checks).

Target Unmet: Pay.gov program was not implemented during 

FY 2009. The vendor representative was available to inform 

about the benefits of Pay.gov but the designers and builders of 

the project were unavailable due to a large volume of existing 

contracts with other agencies. FMC has been placed on the project waiting list.

25%

25%

39%

0

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 5.1 Organize and manage the agency's staff consistent with established priorities, with an emphasis on workforce planning, diversity, and effective internal communication.

Measure: Percentage of agency employees who participated in 

required annual training during the fiscal year (e.g., ethics, IT 

security, No FEAR, etc.).

Measure: Number of awareness, recruitment, training, newemployee orientation, workforce development, and quality of life 

initiatives offered to agency employees.

Target Unmet: Fewer offerings were made to employees than 

anticipated.

100%

250

100%

216

Outcome Goal 5.2 Clearly and accurately communicate the Commission program requirements, activities and decisions in a manner consistent with the Information Quality Guidelines for Federal Agencies.

Measure: Percentage of internal Commission orders or SOPs 

reviewed, developed or updated by Office of Administration during the fiscal year.

Measure: Percentage of agency records which have been assessed with respect to records disposition requirements with respect to the current fiscal year.

33%

33%

69%

65%

Outcome Goal 5.3 Respond to changing industry conditions and business environment 

through use of state-of-the-art automated systems for internal and external processes and a 

flexible and well-trained workforce.

Measure: Percentage of agency employees who participated in 

optional skill-building, management and other training during 

the current fiscal year.

Measure: Percent of payments (user fees, penalties, etc.) received electronically via Pay.gov versus older technologies (e.g., 

checks).

Target Unmet: Pay.gov program was not implemented during 

FY 2009. The vendor representative was available to inform 

about the benefits of Pay.gov but the designers and builders of 

the project were unavailable due to a large volume of existing 

contracts with other agencies. FMC has been placed on the project waiting list.

25%

25%

39%

0

 24 

CHAPTER TWO 

PROGRAM PERFORMANCE 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 25

Chapter Two 

 PROGRAM PERFORMANCE 

Performance Measure FY 2009

Target

FY 2009

Actual

Outcome Goal 5.4 Enhance performance and accountability through linking planning, financial management and performance.

Measure: Percentage of management officials undertaking reviews of internal controls and vulnerability assessments for their 

programs during the current fiscal year. 

Measure: Number of material deficiencies found in most recent 

financial statement audit. 

Measure: Received unqualified opinion from financial statement 

auditors with respect to the current fiscal year.

95%

1 or fewer 

material 

deficiencies

Yes

 100%

0

Yes
 26 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 

CHAPTER THREE

AUDITOR’S REPORTS AND FINANCIAL 

STATEMENTS 

Fiscal Year 2009 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 26

Message from the Chief Financial Officer 

The FY 2009 PAR highlights for the President, the Congress and the American people the continuing commitment 

of the Federal Maritime Commission to maintain sound financial management of the resources 

entrusted to us. I am pleased to present the FMC’s financial statements for FY 2009. Our 

independent auditor has rendered an unqualified opinion on our FY 2009 financial statements. 

The FMC now has received an unqualified opinion in each of the six years in which 

independent financial audits have been conducted, attesting to the FMC’s commitment to high 

quality financial management. 

 

The FMC’s financial condition is sound, and the Commission has sufficient internal controls 

in place to ensure its budget authority is not exceeded and that funds are utilized efficiently 

and effectively. 

 

During FY 2009, the FMC continued its focus on internal controls, as mandated by OMB 

Circular A-123. Our financial management staff is to be commended for consistently finding ways to provide 

budget information in concise, reliable, and understandable formats. In late 2008, the agency’s goals and 

objectives were revised and a new Strategic Plan for Fiscal Years 2010-2015 was approved by the Commission in 

December 2008 following an opportunity for public comment. In addition, we completed corrective actions on a 

number of audit recommendations. Quarterly financial statements were issued 15 days after the end of each 

quarter, and our FY 2009 PAR is being published on November 16, 2009. 

 

The FMC is committed to efficient and effective management of agency resources. We will focus in FY 2010 on 

maintaining an unqualified audit opinion and will continue to use timely, reliable, and comprehensive financial 

information when making agency decisions. I anticipate that in FY 2010 the FMC will continue its high level of 

quality financial management. 

 

Sincerely, 

Ronald D. Murphy 

Chief Financial Officer 

November 16, 2009 

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

PRINCIPAL STATEMENTS 

LIMITATIONS OF THE FINANCIAL STATEMENTS 

The principal statements have been prepared to report the financial position and results of operations of the FMC, 

pursuant to the requirements of the Chief Financial Officers Act of 1990, as amended by the Government 

Management Reform Act of 1994. These statements have been prepared from the books and records of the FMC in 

accordance with the formats prescribed by the Office of Management and Budget. However, these statements 

differ from the financial reports used to monitor and control budgetary resources that are prepared from the same 

books and records. The principal statements should be read with the realization they are for a component of the 

U.S. Government, a sovereign entity. Liabilities not covered by budgetary resources cannot be liquidated without 

the enactment of an appropriation, and the payment of all liabilities other than for contracts can be abrogated by the 

sovereign entity. Other limitations are included in the footnotes to the principal statements. The accompanying 

notes are an integral part of these statements. 

The Federal Maritime Commission’s financial statements were audited by Dembo, Jones, Pennington, Healy & 

Marshall, P.C., under contract to the FMC’s Office of the Inspector General.

 27 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 28

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

Independent Auditor’s Report
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

 29 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 30

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

 31 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 32

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

2009 2008

Assets:

Intragovernmental:

Fund Balance With Treasury (Note 2) $ 4,777,674 $ 4,062,134

Total Intragovernmental 4,777,674 4,062,134

Accounts Receivable (Note 3) 70,222 64,579

General Property, Plant and Equipment, Net (Note 4) 202,500 2,112

Total Assets $ 5,050,396 $ 4,128,825

Liabilities (Note 5):

Intragovernmental:

Accounts Payable $ 309,177 $ 36,647

Employer Contributions and Payroll Taxes Payable 138,468 118,028

Unfunded FECA Liability 1,968 1,968

Custodial Liability 69,236 63,593

Total Intragovernmental 518,849 220,236

Accounts Payable 231,925 273,627

Accrued Payroll and Leave 865,970 914,920

Employer Contributions and Payroll Taxes Payable 17,568 12,124

Unfunded Leave 1,075,533 1,030,319

Actuarial FECA Liability 5,249 -

Total Liabilities $ 2,715,094 $ 2,451,226

Net Position:

Unexpended Appropriations $ 3,214,566 $ 2,706,788

Cumulative Results of Operations (879,264) (1,029,189)

Total Net Position $ 2,335,302 $ 1,677,599

Total Liabilities and Net Position $ 5,050,396 $ 4,128,825

FEDERAL MARITIME COMMISSION

BALANCE SHEET

AS OF SEPTEMBER 30, 2009 AND 2008

(In Dollars)

 33 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 34

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

2009 2008

Program Costs:

Office of Administration $ 6,237,122 $ 6,088,432

Office of Operations 10,304,424 9,540,047

 Formal Proceedings 6,082,905 5,627,251

 Office of Inspector General 529,935 597,799

 Office of EEO 151,287 161,903

Net Cost of Operations (Note 8) $ 23,305,673 $ 22,015,432

FEDERAL MARITIME COMMISSION

STATEMENT OF NET COST

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2009 AND 2008

(In Dollars)
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

2009 2008

Cumulative Results of Operations:

Beginning Balances $ (1,029,189) $ (1,004,596)

Budgetary Financing Sources:

Appropriations Used 22,258,507 20,906,472

Other Financing Sources (Non-Exchange):

Imputed Financing Sources 1,197,091 1,084,367

Total Financing Sources 23,455,598 21,990,839

Net Cost of Operations 23,305,673 22,015,432

Net Change 149,925 (24,593)

Cumulative Results of Operations $ (879,264) $ (1,029,189)

Unexpended Appropriations:

Beginning Balances $ 2,706,788 $ 1,596,624

Budgetary Financing Sources:

Appropriations Received 22,800,000 22,072,000

Other Adjustments (33,715) (55,364)

Appropriations Used (22,258,507) (20,906,472)

Total Budgetary Financing Sources 507,778 1,110,164

Total Unexpended Appropriations $ 3,214,566 $ 2,706,788

Net Position $ 2,335,302 $ 1,677,599

FEDERAL MARITIME COMMISSION

STATEMENT OF CHANGES IN NET POSITION

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2009 AND 2008

(In Dollars)

 35 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 36

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

2009 2008

Budgetary Resources:

Unobligated Balance Brought Forward, October 1 $ 747,665 $ 210,894

Recoveries of Prior Year Unpaid Obligations 171,489 210,984

Budget Authority

Appropriation 22,800,000 22,072,000

Less: Permanently Not Available 33,715 55,364

Total Budgetary Resources $ 23,685,439 $ 22,438,514

Status of Budgetary Resources:

Obligations Incurred

Direct $ 22,817,981 $ 21,690,849

Unobligated Balance

Apportioned 66,284 447,579

Unobligated Balance Not Available 801,174 300,086

Total Status of Budgetary Resources $ 23,685,439 $ 22,438,514

Change in Obligated Balance:

Obligated Balance, Net

Unpaid Obligations, Brought Forward, October 1 $ 3,314,469 $ 2,632,375

Obligations Incurred Net 22,817,981 21,690,849

Less: Gross Outlays 22,050,745 20,797,771

Less: Recoveries of Prior Year Unpaid

Obligations, Actual 171,489 210,984

Obligated Balance, Net, End of Period

Unpaid obligations 3,910,216 3,314,469

Total, Unpaid Obligated Balance, Net, End of Period $ 3,910,216 $ 3,314,469

Net Outlays:

Gross Outlays $ 22,050,745 $ 20,797,771

Net Outlays $ 22,050,745 $ 20,797,771

FEDERAL MARITIME COMMISSION

STATEMENT OF BUDGETARY RESOURCES

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2009 AND 2008

(In Dollars)
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

2009 2008

Revenue Activity:

Total Cash Collections $ 1,115,241 $ 478,250

Accrual Adjustments 5,643 (1,728)

Total Custodial Revenue 1,120,884 476,522

Disposition of Collections:

Transferred to Others (by Recipient) 1,115,241 478,250

Increase/(Decrease) in Amounts Yet to be Transferred 5,643 (1,728)

Total Disposition of Collections 1,120,884 476,522

Net Custodial Activity $ - $ -

(In Dollars)

FEDERAL MARITIME COMMISSION

STATEMENT OF CUSTODIAL ACTIVITY

FOR THE FISCAL YEARS ENDED SEPTEMBER 30, 2009 AND 2008

 37 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 38

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

A. Reporting Entity 

The Federal Maritime Commission (FMC) was 

established as an independent regulatory agency on 

August 12, 1961. FMC is responsible for the 

regulation of ocean borne transportation in the foreign 

commerce of the United States (U.S.). The principal 

statutes or statutory provisions administered by the 

Commission are the Shipping Act of 1984, the Foreign 

Practices Act of 1988, and section 19 of the Merchant 

Marine Act of 1920, and sections 2 and 3 of Public 

Law No. 89-777. Most of these statutes were modified 

by the passage of the Ocean Shipping Reform Act of 

1998, which took effect in 1999. 

FMC monitors the activities of ocean common carriers, 

marine terminal operators, conferences, ports and 

ocean transportation intermediaries (OTIs) (non-vesseloperating common carriers and ocean freight forwarders) who operate in the foreign commerce of the U.S. to 

ensure they maintain just and reasonable practices. 

FMC maintains a trade monitoring and enforcement 

program designed to detect and appropriately remedy 

malpractices and violations. FMC monitors the laws 

and practices of foreign governments, which could be 

potentially restrictive and identifies carriers owned or 

controlled by foreign governments; processes and reviews agreements and service contracts for compliance 

with statutory requirements; and reviews common carriers’ privately published tariff systems for accessibility 

and accuracy as required by the Ocean Shipping Reform Act of 1998. FMC also issues licenses to qualified OTIs in the U.S., ensures that all OTIs are bonded 

or maintain other evidence of financial responsibility, 

and ensures that passenger vessel operators demonstrate adequate financial responsibility for casualty and 

nonperformance. 

FMC is composed of five Commissioners appointed for 

five-year terms by the President with the advice and 

consent of the Senate. The President designates one of 

the Commissioners to serve as Chairman, who is also 

the chief executive and administrative officer of FMC. 

Congress enacts appropriations to permit FMC to incur 

obligations for authorized purposes. In fiscal years 

2009and 2008, FMC was accountable for General Fund 

appropriations. FMC recognizes budgetary resources 

as assets when cash (funds held by the U.S. Treasury) 

is made available through the Department of 

Treasury General Fund warrants. 

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

General Funds are accounts used to record financial 

transactions arising under congressional appropriations 

or other authorizations to spend general revenues. 

General Fund miscellaneous receipts are accounts established for receipts of non-recurring activity, such as 

fines, penalties, fees and other miscellaneous receipts 

for services and benefits. 

FMC makes custodial collections and holds custodial 

receivables that are non-entity assets and are transferred to Treasury at fiscal year end. 

B. Basis of Presentation 

The financial statements have been prepared to report 

the financial position, net cost of operations, changes 

in net position, and the status and availability of budgetary resources of the FMC. The statements are a requirement of the Accountability of Tax Dollars Act of 

2002. They have been prepared from, and are fully 

supported by, the books and records of FMC in accordance with the hierarchy of accounting principles 

generally accepted in the United States of America, 

standards approved by the principals of the Federal 

Accounting Standards Advisory Board (FASAB), 

OMB Circular A-136, Financial Reporting Requirements and FMC accounting policies which are summarized in this note. These statements, with the exception 

of the Statement of Budgetary Resources, are different 

from financial management reports, which are also 

prepared pursuant to OMB directives that are used to 

monitor and control FMC’s use of budgetary resources. 

The statements consist of the Balance Sheet, Statement 

of Net Cost, Statement of Changes in Net Position, 

Statement of Budgetary Resources, and the Statement 

of Custodial Activity. In accordance with OMB Circular A-136, the financial statements and associated 

notes are presented on a comparative basis. Unless 

specified otherwise, all amounts are presented in dollars. 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

C. Budgets and Budgetary Accounting 

Congress usually enacts appropriations to permit 

FMC to incur obligations for specified purposes. 

In fiscal years 2009 and 2008, the FMC was 

accountable for General Fund appropriations. The 

agency recognizes budgetary resources as assets 

when cash (funds held by the U.S. Treasury) is 

made available through the Department of 

Treasury General Fund warrants. 

D. Basis of Accounting 

Transactions are recorded on both an accrual 

accounting basis and a budgetary basis. Under the 

accrual method, revenues are recognized when 

earned, and expenses are recognized when a 

liability is incurred, without regard to receipt or 

payment of cash. Budgetary accounting facilitates 

compliance with legal requirements on the use of 

federal funds. Balances on these statements may 

therefore differ from those on financial reports 

prepared pursuant to other OMB directives that 

are primarily used to monitor and control FMC's 

use of budgetary resources. 

E. Revenues & Other Financing Sources 

Congress enacts annual appropriations to be used, 

within statutory limits, for operating and capital 

expenditures. Additional revenues are obtained 

from service fees and reimbursements from other 

government entities and the public, but these 

revenues are not available to the agency to fund 

operating expenses. 

Appropriations are recognized as a financing 

source when expended. Revenues from service 

fees associated with reimbursable agreements are 

recognized concurrently with the recognition of 

accrued expenditures for performing the services.

Appropriations expended for capitalized property 

and equipment are recognized as expenses when 

an asset is consumed in operations. 

FMC recognizes as an imputed financing source, 

the amount of accrued pension and post-retirement 

benefit expenses for current employees paid on its 

behalf by the Office of Personnel Management 

(OPM). 

F. Taxes 

FMC, as a federal entity, is not subject to federal, 

state, or local income taxes, and, accordingly, no 

provision for income taxes has been recorded in 

the accompanying financial statements. 

G. Fund Balance with Treasury 

The U.S. Treasury processes cash receipts and 

disbursements. Funds held at the Treasury are 

available to pay agency liabilities. FMC does not 

maintain cash in commercial bank accounts or 

foreign currency balances. 

H. Accounts Receivable 

Accounts receivable consists of amounts owed to 

FMC by other federal agencies, its employees and 

the general public. Accounts receivable in the 

Salaries and Expense Fund represent 

employee-related receivables. An allowance for 

uncollectible accounts receivable from the public 

is established when, based upon a review of 

outstanding accounts, management determines 

that collection is unlikely to occur considering the 

debtor’s ability to pay. Debts six months or more 

past due are referred to the Department of 

Treasury for follow-up collection efforts in 

keeping with the Debt Collection Improvement 

Act of 1996 (DCIA). Treasury’s Debt 

Management Services (DMS) administers the 

program and deducts 18 percent from amounts 

ultimately collected for its fee. Collections, net of 

fees, are returned to the FMC for remittance to the 

general fund of the Treasury. 

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont) 

 39 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 40

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

I. Property, Equipment, and Software 

Property, equipment and software represent 

furniture, fixtures, equipment, and information 

technology (IT) hardware and software which are 

recorded at original acquisition cost and are 

depreciated or amortized using the straight-line 

method over their estimated useful lives. Major 

alterations and renovations are capitalized, except 

wherein the tenant improvement allowance 

specified in lease agreements covers the costs of 

certain renovations. Maintenance and repair costs 

are expensed as incurred. FMC's capitalization 

threshold is $25,000 for individual purchases. 

Applicable standard governmental guidelines 

regulate the disposal and convertibility of agency 

property, equipment and software. The useful life 

classifications for capitalized assets are as follows: 

J. Advances and Prepaid Charges 

Advance payments are generally prohibited by 

law. There are exceptions, such as some 

reimbursable agreements, subscriptions, and 

payments to contractors and employees. 

Payments made in advance of the receipt of goods 

and services are recorded as advances or prepaid 

charges at the time of prepayment and recognized 

as expenses when the related goods and services 

are received. 

K. Liabilities 

Liabilities represent the amount of monies or other 

resources likely to be paid by the FMC as a result of 

transactions or events that have already occurred. No 

liability can be paid, however, absent an appropriation 

or other funding. 

Liabilities covered by budgetary or other 

resources are those liabilities for which Congress 

has appropriated funds or funding is otherwise 

available to pay amounts due. Liabilities for 

which an appropriation has not been enacted or 

other funds received are, therefore, classified as 

not covered by budgetary resources. The 

liquidation of liabilities not covered by budgetary 

or other resources is dependent on future 

congressional appropriations or other funding. 

There is no certainty that the appropriation will be 

enacted. Intragovernmental liabilities are claims 

against FMC by other federal agencies. Liabilities 

not covered by budgetary resources on the 

Balance Sheet are equivalent to amounts reported 

as components requiring or generating resources 

on the Reconciliation of Net Cost to Budget. 

Additionally, the government, acting in its 

sovereign capacity, can abrogate liabilities. 

L. Accounts Payable 

Accounts payable consists primarily of amounts 

owed to other federal agencies and the public for 

contracts for goods or services, such as leases, 

utilities, telecommunications and consulting and 

support services. 

M. Annual, Sick, and Other Leave 

Annual leave is accrued as it is earned, and the 

accrual is reduced as leave is taken. The balance 

in the accrued leave account is adjusted to reflect 

current pay rates. Liabilities associated with other 

types of vested leave, including compensatory, 

restored leave, and sick leave in certain 

circumstances, are accrued at year-end, based on 

latest pay rates and unused hours of leave. 

Funding will be obtained from future financing 

sources to the extent that current or prior year 

appropriations are not available to fund annual 

and other types of vested leave earned but not 

taken. Nonvested leave is expensed when used. 

Description Useful Life (years)

Leasehold Improvements 5

Office Furniture 5

Computer Equipment 5

Office Equipment 5

IT Software 5

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont) 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

 41

CHAPTER THREE 

AUDITOR’S REPORT and 

Employees hired prior to January 1, 1984 elected 

to join either FERS and Social Security, or remain 

in CSRS. All employees are eligible to contribute 

to the Thrift Savings Plan (TSP). For those 

employees participating in the FERS, a TSP 

account is automatically established and FMC 

makes a mandatory one percent contribution to 

this account. In addition, FMC makes matching 

contributions, ranging from one to four percent, 

for FERS eligible employees who contribute to 

their TSP accounts. Matching contributions are 

not made to the TSP accounts established by 

CSRS employees. For FERS participants, FMC 

also remits the employer's share of the required 

contribution. 

FERS employees and certain CSRS reinstatement 

employees are eligible to participate in the Social 

Security program after retirement. 

FMC recognizes the imputed cost of pension and 

other retirement benefits during the employees’ 

active years of service. OPM actuaries determine 

pension cost factors by calculating the value of 

pension benefits expected to be paid in the future 

and communicate these factors to FMC for current 

period expense reporting. OPM also provides 

information regarding the full cost of health and 

life insurance benefits. FMC recognized the 

offsetting revenue as imputed financing sources to 

the extent these expenses will be paid by OPM. 

FMC does not report on its financial statements 

information pertaining to the retirement plans 

covering its employees. Reporting amounts such 

as plan assets, accumulated plan benefits, and 

related unfunded liabilities, if any, is the 

responsibility of the OPM. 

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont) 

Any liability for unused sick leave that is accrued 

but not taken by a Civil Service Retirement 

System (CSRS)-covered employee is transferred 

to the Office of Personnel Management upon the 

retirement of that individual. No credit is given 

for sick leave balances upon the retirement of 

Federal Employee’s Retirement System 

(FERS)-covered employees. 

N. Accrued and Actuarial Workers’ Compensation 

The Federal Employees' Compensation Act 

(FECA) administered by the U.S. Department of 

Labor (DOL) addresses all claims brought by 

FMC employees for on-the-job injuries. A 

liability is recorded for actual and estimated future 

payments to be made for workers' compensation 

pursuant to the FECA. The DOL bills each 

agency annually as its claims are paid, and the 

actual costs incurred are reflected as a liability to 

the agency. Payment of these bills is deferred for 

two years to allow for funding through the budget 

process. Similarly, employees that the FMC 

terminates without cause may receive 

unemployment compensation benefits under the 

unemployment insurance program also 

administered by the DOL, which bills each agency 

quarterly for paid claims. Future appropriations 

will be used for the reimbursement to DOL. The 

liability consists of (1) the net present value of 

estimated future payments calculated by the DOL, 

and (2) the unreimbursed cost paid by DOL for 

compensation to recipients under the FECA. 

O. Retirement Plans 

FMC employees participate in either the Civil 

Service Retirement System (CSRS) or the Federal 

Employees' Retirement System (FERS). The 

employees who participate in CSRS are 

beneficiaries of FMC's contribution, equal to 

seven percent of pay, distributed to their annuity 

account in the Civil Service Retirement and 

Disability Fund. 

FERS went into effect on January 1, 1987. FERS 

and Social Security automatically cover most 

employees hired after December 31, 1983. 
FEDERAL MARITIME 

COMMISSION 

 42

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

P. Use of Estimates 

The preparation of the accompanying financial 

statements in accordance with generally accepted 

accounting principles requires management to 

make certain estimates and assumptions that affect 

the reported amounts of assets and liabilities and 

disclosure of contingent assets and liabilities at the 

date of the financial statements and the reported 

amounts of revenues and expenses during the 

reporting period. Actual results could differ from 

those estimates. 

Q. Net Position 

Net position is the residual difference between 

assets and liabilities and is comprised of 

unexpended appropriations and cumulative results 

of operations. Unexpended appropriations 

represent the amount of unobligated and 

unexpended budget authority. Unobligated 

balances are the amount of appropriations or other 

authority remaining after deducting the 

cumulative obligations from the amount available 

for obligation. The cumulative results of 

operations is the net result of FMC’s operations 

since inception. 

R. Imputed Costs/Financing Sources 

Federal Government entities often receive goods 

and services from other Federal Government 

entities without reimbursing the providing entity 

for all the related costs. In addition, Federal 

Government entities also incur costs that are paid 

in total or in part by other entities. An imputed 

financing source is recognized by the receiving 

entity for costs that are paid by other entities. 

FMC recognized imputed costs and financing 

sources in fiscal years 2009 and 2008 to the extent 

directed by OMB.

S. Contingencies 

Liabilities are deemed contingent when the 

existence or amount of the liability cannot be 

determined with certainty pending the outcome of 

future events. FMC recognizes contingent 

liabilities, in the accompanying balance sheet and 

statement of net cost, when it is both probable and 

can be reasonably estimated. FMC discloses 

contingent liabilities in the notes to the financial 

statements when the conditions for liability 

recognition are not met or when a loss from the 

outcome of future events is more than remote. In 

some cases, once losses are certain, payments may 

be made from the Judgment Fund maintained by 

the U.S. Treasury rather than from the amounts 

appropriated to FMC for agency operations. 

Payments from the Judgment Fund are recorded as 

an “Other Financing Source” when made. 

T. Expired Accounts and Cancelled Authority 

Unless otherwise specified by law, annual authority expires for incurring new obligations at the 

beginning of the subsequent fiscal year. The 

account in which the annual authority is placed is 

called the expired account. For five fiscal years, 

the expired account is available for expenditure to 

liquidate valid obligations incurred during the 

unexpired period. Adjustments are allowed to 

increase or decrease valid obligations incurred 

during the unexpired period but not previously 

reported. At the end of the fifth expired year, the 

expired account is cancelled. 

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (cont) 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

NOTE 2. FUND BALANCE WITH TREASURY

Fund balance with Treasury account balances as of September 30, 2009 and 2008 were as follows: 

Fund Balances: 

Status of Fund Balance with Treasury: 

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

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

balance as described in the following paragraph. 

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

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

obligations incurred only during the period for which the appropriation was available for obligation or 

for paying claims attributable to the appropriations. 

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

orders that have reduced unexpended appropriations but have not yet decreased the cash balance on 

hand. (see also Note 13) 

2009 2008

Appropriated Funds $ 4,777,674 $ 4,062,134 

Total $ 4,777,674 $ 4,062,134 

2009 2008

Unobligated Balance

 Available $ 66,284 $ 447,579 

 Unavailable 801,174 300,086 

Obligated Balance Not Yet Disbursed 3,910,216 3,314,469 

Total $ 4,777,674 $ 4,062,134 

2009 2008

Unobligated Balance

 Available $ 66,284 $ 447,579 

 Unavailable 801,174 300,086 

Obligated Balance Not Yet Disbursed 3,910,216 3,314,469 

Total $ 4,777,674 $ 4,062,134 

2009 2008

Appropriated Funds $ 4,777,674 $ 4,062,134 

Total $ 4,777,674 $ 4,062,134 

 43 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 44

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

NOTE 3. ACCOUNTS RECEIVABLE 

Accounts receivable balances as of September 30, 2009 and 2008 were as follows: 

The accounts receivable is primarily made up of a balance from one non-federal vendor for $56,421 that 

represents an amount due from a contractor for unsupported claims that were paid by the agency. 

NOTE 4. PROPERTY, EQUIPMENT, AND SOFTWARE 

Property, equipment, and software account balances as of September 30, 2009 and 2008 were as 

follows: 

Schedule of Property, Equipment, and Software as of September 30, 2009 

Schedule of Property, Equipment, and Software as of September 30, 2008 

2009 2008

With the Public

Contractor/Vendor Related Receivables $ 56,515 $ 56,421

Interest Receivable 5,085 2,796

Penalties, Fines, and Administrative Fees Receivable 7,636 4,204

Employee-Related Receivable(s) 986 1,158

Total Accounts Receivable $ 70,222 $ 64,579

Major Class

Acquisition 

Cost

Accumulated 

Amortization/ 

Depreciation

Net Book 

Value

Leasehold Improvements $ 225,000 $ 22,500 $ 202,500

Furniture & Equipment 291,938 291,938 -

Total $ 516,938 $ 314,438 $ 202,500

Major Class

Acquisition 

Cost

Accumulated 

Amortization/ 

Depreciation

Net Book 

Value

Furniture & Equipment $ 291,938 $ 289,826 $ 2,112

Total $ 291,938 $ 289,826 $ 2,112

Major Class

Acquisition 

Cost

Accumulated 

Amortization/ 

Depreciation

Net Book 

Value

Furniture & Equipment $ 291,938 $ 289,826 $ 2,112

Total $ 291,938 $ 289,826 $ 2,112

Major Class

Acquisition 

Cost

Accumulated 

Amortization/ 

Depreciation

Net Book 

Value

Leasehold Improvements $ 225,000 $ 22,500 $ 202,500

Furniture & Equipment 291,938 291,938 -

Total $ 516,938 $ 314,438 $ 202,500

2009 2008

With the Public

Contractor/Vendor Related Receivables $ 56,515 $ 56,421

Interest Receivable 5,085 2,796

Penalties, Fines, and Administrative Fees Receivable 7,636 4,204

Employee-Related Receivable(s) 986 1,158

Total Accounts Receivable $ 70,222 $ 64,579
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

NOTE 5. LIABILITIES NOT COVERED BY BUDGETARY RESOURCES 

The liabilities on the FMC's Balance Sheet as of September 30, 2009 and 2008, include liabilities not 

covered by budgetary resources. Congressional action is needed before budgetary resources can be 

provided. Although future appropriations to fund these liabilities are likely and anticipated, it is not 

certain that appropriations will be enacted to fund these liabilities. 

The Federal Maritime Commission records a liability for future worker's compensation claims based on 

data provided from the Department of Labor. The FMC also records a liability for actual claims paid on 

its behalf by the DOL. 

NOTE 6. ACCOUNTS PAYABLE 

Liabilities include both Intragovernmental Accounts Payable and Other Accounts Payable. 

Intragovernmental payables are owed to other federal entities for rent, printing costs, and services of 

other agencies. In FY09, approximately $225,000 of the Intragovernmental payable of $309,177 was 

owed to the General Services Administration for leasehold improvements made to FMC offices. Other 

Payables (formerly categorized as "With the Public") are owed to non-federal sources or to the general 

public, and include liabilities for general supplies, training, studies, analysis, and/or evaluations, 

miscellaneous services, and operation and maintenance of ADP equipment. For fiscal year ending 

September 30, 2009, the non-federal accounts payable totals to $231,925. 

NOTE 7. LEASES 

Operating Leases

FMC occupies office space in seven locations, of which only six of the lease agreements are required to 

be accounted for as operating leases. Lease payments are increased annually based on the adjustments 

for operating cost and real estate tax escalations. The lease locations and terms are listed below: 

2009 2008

Intragovernmental – FECA $ 1,968 $ 1,968

Unfunded Leave 1,075,533 1,030,319

Actuarial FECA 5,249 -

Total Liabilities Not Covered by Budgetary Resources 1,082,750 $ $ 1,032,287

Location Term Lease Expiration Date

Hollywood, FL 23 months 5/31/2010

San Pedro, CA 5 years 9/30/2011

Washington DC 10 years 10/31/2012

Jamaica, NY 5 years 7/1/2013

Houston, TX 10 years 9/14/2018

Seattle, WA 10 years 6/30/2019

Location Term Lease Expiration Date

Hollywood, FL 23 months 5/31/2010

San Pedro, CA 5 years 9/30/2011

Washington DC 10 years 10/31/2012

Jamaica, NY 5 years 7/1/2013

Houston, TX 10 years 9/14/2018

Seattle, WA 10 years 6/30/2019

2009 2008

Intragovernmental – FECA $ 1,968 $ 1,968

Unfunded Leave 1,075,533 1,030,319

Actuarial FECA 5,249 -

Total Liabilities Not Covered by Budgetary Resources 1,082,750 $ $ 1,032,287

 45 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 46

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

The lease amounts vary from year to year depending on the specific lease. The schedule of future 

payments for the term of the leases is as follows: 

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

NOTE 8. CONTINGENCIES 

There are legal actions pending against FMC in which claims have been asserted that may be based on 

action taken by FMC. Management intends to vigorously contest all such claims. Management 

believes, based on information provided by legal counsel, that losses, if any, for these cases would not 

have a material impact on the Financial Statements. No loss accrual has been made for these cases 

outstanding at September 30, 2009. 

Fiscal Year Totals

2010 $ 2,905,584

2011 2,910,491

2012 2,925,935

2013 302,768

2014 25,933

Thereafter 114,638

Total Future Payments $ 9,185,349

Fiscal Year Totals

2010 $ 2,905,584

2011 2,910,491

2012 2,925,935

2013 302,768

2014 25,933

Thereafter 114,638

Total Future Payments $ 9,185,349
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

NOTE 9. INTRAGOVERNMENTAL COSTS 

Intragovernmental costs represent goods and services exchange transactions made between two 

reporting entities within the Federal government, and are in contrast to those with non-federal entities 

(the public). Intragovernmental costs include payments to federal vendors for personnel benefits, rent, 

utilities, and other services. Payments made to non-federal entities (the public) are comprised primarily 

of employee salaries and other services. Such costs are summarized as follows: 

2009 2008

Office of Administration

 Intragovernmental Costs $ 3,050,365 $ 2,844,453

 Public Costs 3,186,757 3,243,979

 Total Program Costs 6,237,122 6,088,432

Office of Operations

 Intragovernmental Costs 3,329,302 3,005,774

 Public Costs 6,975,122 6,534,273

 Total Program Costs 10,304,424 9,540,047

Formal Proceedings

 Intragovernmental Costs 1,961,167 1,785,954

 Public Costs 4,121,738 3,841,297

 Total Program Costs 6,082,905 5,627,251

Office of Inspector General

 Intragovernmental Costs 150,600 165,737

 Public Costs 379,335 432,062

 Total Program Costs 529,935 597,799

Office of Equal Employment Opportunity

 Intragovernmental Costs 43,579 71,152

 Public Costs 107,708 90,751

 Total Program Costs 151,287 161,903

Total Intragovernmental costs 8,535,013 7,873,070

Total Public costs 14,770,660 14,142,362

 Total Costs 23,305,673 22,015,432

 Total Net Cost $ 23,305,673 $ 22,015,432

2009 2008

Office of Administration

 Intragovernmental Costs $ 3,050,365 $ 2,844,453

 Public Costs 3,186,757 3,243,979

 Total Program Costs 6,237,122 6,088,432

Office of Operations

 Intragovernmental Costs 3,329,302 3,005,774

 Public Costs 6,975,122 6,534,273

 Total Program Costs 10,304,424 9,540,047

Formal Proceedings

 Intragovernmental Costs 1,961,167 1,785,954

 Public Costs 4,121,738 3,841,297

 Total Program Costs 6,082,905 5,627,251

Office of Inspector General

 Intragovernmental Costs 150,600 165,737

 Public Costs 379,335 432,062

 Total Program Costs 529,935 597,799

Office of Equal Employment Opportunity

 Intragovernmental Costs 43,579 71,152

 Public Costs 107,708 90,751

 Total Program Costs 151,287 161,903

Total Intragovernmental costs 8,535,013 7,873,070

Total Public costs 14,770,660 14,142,362

 Total Costs 23,305,673 22,015,432

 Total Net Cost $ 23,305,673 $ 22,015,432

 47 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 48

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

NOTE 10. IMPUTED FINANCING SOURCES 

Imputed financing recognizes the costs of future benefits which include health benefits, life insurance, 

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

with such benefits are the responsibility of the administering agency, the Office of Personnel 

Management (OPM). For the fiscal years ended September 30, 2009 and 2008, respectively, imputed 

financing was as follows. 

NOTE 11. BUDGETARY RESOURCE COMPARISONS TO THE BUDGET OF THE 

UNITED STATES GOVERNMENT 

The President’s Budget that will include FY09 actual budgetary execution information has not yet been 

published. The President’s Budget is scheduled for publication in February 2010 and can be found at 

the OMB Web site: http://www.whitehouse.gov/omb/. The 2010 Budget of the United States 

Government, with the "Actual" column completed for 2008, has been reconciled to the Statement of 

Budgetary Resources and there were no material differences. 

NOTE 12. APPORTIONMENT CATEGORIES OF OBLIGATIONS INCURRED 

Obligations incurred and reported in the Statement of Budgetary Resources as of September 30, 2009 

and 2008 consisted of the following: 

Category A apportionments distribute budgetary resources by fiscal quarters. 

NOTE 13. UNDELIVERED ORDERS AT THE END OF THE PERIOD 

Statement of Federal Financial Accounting Standards No. 7, Accounting for Revenue and Other 

Financing Sources and Concepts for Reconciling Budgetary and Financial Accounting, states that the 

amount of budgetary resources obligated for undelivered orders at the end of the period should be 

disclosed. For the fiscal years ended September 30, 2009 and 2008, respectively, undelivered orders 

amounted to the following: 

2009 2008

Office of Personnel Management $ 1,197,091 $ 1,084,367 

Total Imputed Financing Sources $ 1,197,091 $ 1,084,367 

2009 2008

Direct Obligations, Category A $ 22,817,981 $ 21,690,849

Total Obligations Incurred $ 22,817,981 $ 21,690,849

2009 2008

Undelivered Orders $ 2,347,107 $ 1,959,123

Total Undelivered Orders $ 2,347,107 $ 1,959,123

2009 2008

Undelivered Orders $ 2,347,107 $ 1,959,123

Total Undelivered Orders $ 2,347,107 $ 1,959,123

2009 2008

Direct Obligations, Category A $ 22,817,981 $ 21,690,849

Total Obligations Incurred $ 22,817,981 $ 21,690,849

2009 2008

Office of Personnel Management $ 1,197,091 $ 1,084,367 

Total Imputed Financing Sources $ 1,197,091 $ 1,084,367 
Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 

NOTE 14. CUSTODIAL ACTIVITY 

FMC is an administrative agency collecting for the General Fund. As a collecting entity, FMC measures 

and reports cash collections and refunds as custodial activity on the Statement of Custodial Activity. 

Cash collections result primarily from FMC regulatory activities to include the assessment of fines and 

penalties and the payment of license fees by qualified ocean transportation intermediaries (OTIs) in the 

U.S. A small portion of amounts collected is for interest on past due fines, petitions, status changes and 

special permission fees. 

Custodial receipts are broken out in the following general receipt funds: 

Fund 2009 2008

Fines, Penalties and Forfeitures $ 843,000 $ 182,513 

General Fund Proprietary Receipts (license fees) 273,218 299,947 

Refund of Moneys Erroneously Received and Covered (977) (4,210)

Total Custodial Collections $ 1,115,241 $ 478,250 

 49 

CHAPTER THREE 

AUDITOR’S REPORT and FINANCIAL STATEMENTS 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 50

NOTE 15. RECONCILIATION OF NET COST OF OPERATIONS TO BUDGET 

FMC has reconciled its budgetary obligations and non-budgetary resources available to its net cost of 

operations. 

2009 2008

Resources Used to Finance Activities:

Budgetary Resources Obligated

Obligations Incurred $ 21,690,849 22,817,981 $ 

Less: Spending Authority From Offsetting Collections and Recoveries 171,489 210,984

Obligations Net of Offsetting Collections and Recoveries 22,646,492 21,479,865

Other Resources

Imputed Financing From Costs Absorbed By Others 1,197,091 1,084,367

Net Other Resources Used to Finance Activities 1,197,091 1,084,367

Total Resources Used to Finance Activities 23,843,583 22,564,232

Resources Used to Finance Items Not Part of the Net Cost of Operations

Change In Budgetary Resources Obligated For Goods,

Services and Benefits Ordered But Not Yet Provided 387,985 573,393

Resources That Finance the Acquisition of Assets 225,000 - 

Total Resources Used to Finance Items Not Part of Net Cost of Operations 612,985 573,393

Total Resources Used to Finance the Net Cost of Operations 23,230,598 21,990,839

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

Generate Resources in the Current Period

Components Requiring or Generating Resources in Future Periods

Increase In Annual Leave Liability 45,214 17,799 

Other 5,249 1,968 

Total Components of Net Cost of Operations That Will Require or

Generate Resources In Future Periods 50,463 19,767 

Components Not Requiring or Generating Resources:

Depreciation and Amortization 24,612 4,989 

Other (163) - 

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

Generate Resources 24,612 4,826 

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

Generate Resources In The Current Period 75,075 24,593 

Net Cost of Operations $ 22,015,432 23,305,673 $ 

2009 2008

Resources Used to Finance Activities:

Budgetary Resources Obligated

Obligations Incurred $ 21,690,849 22,817,981 $ 

Less: Spending Authority From Offsetting Collections and Recoveries 171,489 210,984

Obligations Net of Offsetting Collections and Recoveries 22,646,492 21,479,865

Other Resources

Imputed Financing From Costs Absorbed By Others 1,197,091 1,084,367

Net Other Resources Used to Finance Activities 1,197,091 1,084,367

Total Resources Used to Finance Activities 23,843,583 22,564,232

Resources Used to Finance Items Not Part of the Net Cost of Operations

Change In Budgetary Resources Obligated For Goods,

Services and Benefits Ordered But Not Yet Provided 387,985 573,393

Resources That Finance the Acquisition of Assets 225,000 - 

Total Resources Used to Finance Items Not Part of Net Cost of Operations 612,985 573,393

Total Resources Used to Finance the Net Cost of Operations 23,230,598 21,990,839

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

Generate Resources in the Current Period

Components Requiring or Generating Resources in Future Periods

Increase In Annual Leave Liability 45,214 17,799 

Other 5,249 1,968 

Total Components of Net Cost of Operations That Will Require or

Generate Resources In Future Periods 50,463 19,767 

Components Not Requiring or Generating Resources:

Depreciation and Amortization 24,612 4,989 

Other (163) - 

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

Generate Resources 24,612 4,826 

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

Generate Resources In The Current Period 75,075 24,593 

Net Cost of Operations $ 22,015,432 23,305,673 $ 

Chapter Three 

 AUDITOR’S REPORTS AND FINANCIAL STATEMENTS 
 51 

CHAPTER ONE 

MANAGEMENT’S DISCUSSION and ANALYSIS 

CHAPTER FOUR

OTHER ACCOMPANYING INFORMATION 

Fiscal Year 2009 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 49

 Inspector General-Identified Management and Performance Challenges 
 Inspector General-Identified Management and Performance Challenges 

2009 Management Challenges 

Management and Performance Challenge: 

To understand and implement internal control to help prevent waste, fraud, abuse or mismanagement in Commission programs. 

Agency Progress in Addressing the Challenge: 

The Office of Management and Budget (OMB) provides guidance to federal managers under OMB Circular A-123 

Revisions to OMB Circular A-123, Management’s Responsibility for Internal Control, dated December 21, 2004. 

This policy states that management is responsible for establishing and maintaining internal control to achieve the 

objectives of effective and efficient operations, reliable financial reporting and compliance with applicable laws 

and regulations. 

The objectives of the Federal Maritime Commission (FMC) system of management accountability and internal 

control are to provide reasonable assurance that: 

Programs achieve their intended results; 

Resources are used consistent with the agency mission; 

Programs and resources are protected from waste, fraud, and mismanagement; 

Laws and regulations are followed; and 

Reliable and timely information is obtained, maintained, reported, and used for decision-making. 

The concept of reasonable assurance recognizes that the cost of internal controls should not exceed the expected 

benefits, and that the benefits consist of reductions in the risks of failing to achieve the stated objectives. Estimates 

and judgments are required to assess the expected benefits and related costs of control procedures. 

Annually, FMC managers respond to an internal control questionnaire focusing on various aspects of programs 

they oversee. When preparing the questionnaires, managers are required to solicit input from staff while emphasizing “the importance of the evaluation.” To ensure all staff participates in the process, managers must provide the 

date (s) that such discussions occurred. Questionnaire responses are reviewed by the OIG to help it identify risks 

that could impact agency operations and financial reporting. Questionnaires are also collectively submitted to the 

Chairman, who then provides an annual assurance statement (in the Performance and Accountability Report) certifying that internal control over financial reporting is operating effectively and that no material weaknesses were 

found in its design or operation. 

While management has gone to great lengths to comply with OMB requirements, we are concerned that many 

managers do not understand related concepts of risk and vulnerabilities when applied to agency programs and operations. For example, in the OIG’s FY 2009 review of FMC’s time and attendance practices, we found that the 

time and attendance system did not have adequate controls (separation of duties) in place that would prevent or 

deter timekeepers from altering leave records, including their own. We also identified a lack of uniformity across 

bureaus / offices in the administration of employee leave, including inconsistent requirements for requesting and 

recording leave. Although the finding cut across many FMC bureaus and offices, these weaknesses were not identified on any of the questionnaires submitted by the program offices. 

The Challenge Ahead: 

While the FMC management collectively participates in the internal control self assessment, it must take a closer 

look at its control activities when responding to the annual questionnaire, to include policies and procedures, management objectives, segregation of duties, safeguarding of records, and physical and access controls to assess their 

risks in the program areas. 

 

Management and Performance Challenge: 

Develop and implement a succession plan to address future workforce and skills needed to continue the agency’s 

mission. 

 50 

CHAPTER FOUR 

OTHER ACCOMPANYING INFORMATION 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 51

Inspector General-Identified Management and Performance Challenges 

Agency Progress in Addressing the Challenge: 

Similar to the workforce status of other federal government agencies, a large portion of the 130 FMC employees 

have reached or will reach retirement age in the next few years. Consequently, it is imperative that management 

identifies the critical skills that will be needed to continue to provide oversight of the international ocean shipping 

industry and formulate a strategic plan to cultivate its workforce, accordingly. Such a plan should include recruitment for the identified critical skills as well as employee retention, which plays a key role when considering the 

status of the workforce. 

The Challenge Ahead:

In recent years, the agency has been criticized for problems it was experiencing with low employee morale and 

employee development. However, the President recently appointed a new FMC Chairman and a recent workforce 

survey administered by the Office of Personnel Management suggests that morale has improved. As the agency 

moves forward under new leadership, this would be the time to identify and develop new leaders from within, in 

addition to infusing the agency with fresh ideas from outside. To avoid falling into false sense of comfort that can 

occur when people have become assimilated to one environment or method of operation, new employees should be 

recruited at all levels, from low GS levels up through the ranks of the SES. 

Management and Performance Challenge: Securing agency information systems from data loss, destruction or 

compromise. 

Agency Progress in Addressing the Challenge:

The FMC relies heavily on information technology (IT) to accomplish its mission. Further, the President has 

placed a high priority on securing the Federal government’s operations and assets. Protecting the information and 

information systems on which the federal government depends requires agencies to identify and resolve current 

security weaknesses and risks and to protect against future vulnerabilities and threats. 

The OIG reviews the agency’s IT security program annually. The Federal Information Security Management Act 

evaluations have identified both strengths and weaknesses in the agency’s security program and recommendations 

in these reports serve as a blueprint for management to move the agency into compliance with the myriad regulations that have appeared in response to real and perceived threats to federal information systems. Each year, the 

agency has made steady improvements in its overall security posture. For example, the agency has certified and 

accredited two of four information systems that serve both agency staff and the public. The security training it 

provides to agency staff not only contains sections on common IT vulnerabilities, but was attended by all agency 

staff in FY 2009. The agency has documented back-up procedures and stores backups at various off-site locations 

and has also established a hot site that should keep critical systems functioning in the event the primary data center 

is destroyed or damaged. 

The FMC has also taken steps to ensure privacy and protection of personally identifiable information. The FMC 

appointed a Privacy Officer and has posted its privacy policy on its website. Recently the agency completed a thorough review of employee-initiated forms for PII (personally identifiable information). 

On the other hand, we note that two systems are in production that have not been certified and accredited. Management hired a contractor to perform testing and certification of all systems but decided to scrap the uncertified 

systems and rebuild them. Looking back, the decision to place these two systems into production without accreditation put the agency at risk. However, a new contractor has already been selected to redesign and accredit these 

systems. 

We are also concerned that the agency has not fully assessed the risk to its systems as a foundation to assess controls in place and to identify controls that need to be implemented or strengthened. Accreditation officials must 

have information on risks to make credible decisions on whether to place applications into production. Further, the 

agency does not monitor IT activity by users; especially troublesome are the accounts of network administrators 

that, in effect, can view activity on any agency computer whether or not a work-related need exists. Further, the 

agency still lacks documented information security policies in many critical areas. 
Inspector General-Identified Management and Performance Challenges 

The Challenge Ahead: 

No federal agency, including the FMC, can rest on its security accomplishments made in response to yesterday’s 

threats. Agencies must be proactive and continually evaluate their risks and take concrete steps to mitigate those 

risks – essentially keeping one step ahead of those who threaten agency data and IT operations. The agency must 

focus its resources on certifying and accrediting its two remaining systems. While funds have been set aside for 

this purpose in the budget, contractors must be held accountable for performing this task timely and to OMB specifications. Moving forward, security must be build into system design, i.e., the system lifecycle. It is not something 

added on at design completion. 

 52 

CHAPTER FOUR 

OTHER ACCOMPANYING INFORMATION 
FEDERAL MARITIME COMMISSION 

FY2009 PERFORMANCE AND ACCOUNTABILITY REPORT 

 53

Comments on Management and Performance Challenges Identified by the IG 

Comments on the IG-identified Management and Performance Challenges 

The Inspector General identifies three management challenges facing the FMC, as outlined below: 

I. To understand and implement internal control to help prevent waste, fraud, abuse or mismanagement in 

Commission programs. 

The IG recognizes that Commission management has gone to great lengths to meet OMB requirements. He also 

adeptly explains the concept of reasonable assurance, which requires balancing of benefits and costs of control 

procedures to reduce risks. Yet, he also expresses a concern about whether managers throughout the Commission 

understand the risks and vulnerabilities of Commission programs. To address this concern, the Commission will 

re-emphasize its focus on internal controls in the upcoming year. 

II. Develop and implement a succession plan to address future workforce and skills needed to continue the 

agency’s mission.

This challenge has been met with our recently finalized comprehensive Human Capital Plan (HCP) which directly 

supports the agency’s strategic plan and objectives. The HCP is structured around the five elements found in the 

Human Capital Assessment and Accountability Framework: strategic alignment, leadership and knowledge 

management, performance culture, talent management and accountability. These elements all support the FMC’s 

human capital focus upon identifying and alleviating current and future skills gaps; refining performance plans and 

measures to ensure alignment with FMC organizational goals and to establish baselines against which future 

performance can be assessed; assuring recruitment and retention of skilled employees; and increasing efficiency by 

utilizing technology to enhance the productivity of the workforce. All of these elements are necessarily 

interrelated in that they all serve a common purpose of producing and supporting a workforce that effectively 

meets the Commission’s mission. The HCP includes our Workforce Plan, which analyzes our workforce in detail, 

our Succession Management Plan to ensure continuity of leadership and mission-critical occupations, as well as 

current and future needs. 

III. Commission’s Information Technology Security Program

The FMC made significant progress during FY 2009 to comply fully with the Federal Information Security 

Management Act of 2002 (FISMA). The Commission designed and built a standardized, comprehensive and ongoing monitoring program with upgraded security procedures and policies and built-in monitoring tools. Personnel 

performing significant information security duties have been re-aligned under the agency’s Information Systems 

Security Officer. The agency established and enforced certification and accreditation package documentation for 

its major systems to ensure consistency with guidance and mandates from both OMB and the National Institute of 

Standards and Technology (NIST). 

Through its certification and accreditation process, the Commission has fully assessed and identified risks to its IT 

systems and implemented controls to strengthen information systems security. The FMC routinely conducts 

security inspections on its information systems. A new enterprise content management system, currently under 

construction, is using FISMA guidelines to ensure OMB and NIST requirements will be met. 
 Improper Payments Information Act

Improper Payments Information Act 

Narrative Summary of Implementation Efforts for FY 2009 

 And 

 Agency Plans for FY 2009—FY 2012 

I. The Federal Maritime Commission has not identified any program that in and of itself constitutes a 

high-risk for improper payments. Therefore, the FMC considers all of its payments to fall within the 

realm of high-risk. As such, the FMC has instituted a separation of duties concerning payments that 

has been very successful in curtailing any improper payments. The National Finance Center (NFC) 

became the agency’s payroll provider in 2002 and is responsible for monitoring and reporting on any 

payroll-related payments. Any overpayments made to an FMC employee by the NFC on behalf of the 

FMC are offset by NFC. In FY 2009, the FMC had no overpayments. The FMC did not identify any 

improper collections through Intergovernmental Payments and Collections (IPAC) collections. 

II. The FMC did not use a statistical sample to conduct its improper payment rate. The sample contains 

one hundred percent of all disbursements made by the FMC. This was the case for all programs. 

III. The FMC will continue to monitor all payments to maintain a zero dollar improper payment figure. To 

this end, the FMC will ensure that there are sufficient segregation of duties pertaining to payments 

concomitantly with closer scrutiny of all IPAC collections made against the Commission. The FMC 

will continue to monitor all disbursements made on its behalf to ensure payments are valid and proper. 

IV. The table below represents the improper payments made by the FMC in FY 2009 with percentage 

forecasts through FY 2012. 

Improper Payments Information Act Reduction Outlook FY 2009 - 2012

(millions) 

Program FY 09 

Outlays 

FY09 

IP % 

FY09 

IP $ 

FY10 

% 

FY11 

% 

FY12 

% 

Formal Proceedings $0.00 0.00 $0.00 0.00 0.00 0.00 

Inspector General $0.00 0.00 $0.00 0.00 0.00 0.00 

Equal Employment Opportunity $0.00 0.00 $0.00 0.00 0.00 0.00 

Operations $0.00 0.00 $0.00 0.00 0.00 0.00 

Administration $0.00 0.00 $0.00 0.00 0.00 0.00 

Totals $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 

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 55

Improper Payments Information Act (continued) 

V. The FMC has in place a segregation of duties to ensure that all invoices processed for payment are 

legitimate expenses of the agency. As of October 1, 2006, original accounts payable invoices have been 

received by BPD and forwarded to OFM via electronic media. BPD forwards a copy of the invoice to 

OFM for internal processing and payment authorization. When an invoice is received, it is first verified as 

a valid invoice belonging to the agency. OFM matches the invoice to documentation provided by the 

COTR indicating that goods/services have been received by the Commission and approves the invoice for 

payment. BPD is advised of the purchase order the invoice is being paid against and the dollar amount of 

the payment. OFM also ensures that sufficient funds have been obligated to make the payment and 

provides BPD with the period of performance. Once the payment authorization has been processed by 

OFM, the payment information is verified by a second member of OFM. At that point, the invoice is 

electronically returned to BPD for processing. When the payment is loaded into the Oracle database, a 

final funds availability check is made by the financial system against the fund controls set for the FMC and 

a third OFM individual audits the payment information posted in the financial system. 

 The receipt of an invalid IPAC collection must be processed as a payment for the reason that the funds 

have already been moved from the Treasury General Fund as a disbursement against the FMC’s Agency 

Location Code (ALC). Invalid IPACs are then charged back to the billing agency to reverse the transaction. 

The internal controls in place remain unchanged, with a close scrutiny paid to all invoices and subsequent 

payments. 

VI. The Chairman, as the Chief Administrative Officer of the FMC, is ultimately responsible for the efficient 

and effective utilization of the authority granted the agency by Congress. The Chairman has delegated 

financial responsibility to the Director, OFM. The Director of OFM has the responsibility to ensure that all 

disbursements made by BPD on behalf of the FMC are legitimate expenses of the agency and that there are 

sufficient funds available to pay the agency’s expenses. The OFM is responsible for reducing and 

recovering improper payments, and keeps senior agency officials appraised of all relevant activities. 

VII. a. The FMC does not have an in-house information system to help reduce improper payments. The agency 

utilizes the infrastructure and financial system maintained in Parkersburg, WV by BPD. 

 b. In FY 2009, the FMC requested funding to maintain the contract between the FMC and BPD for 

financial support and platform access to the Oracle database through Oracle’s Discoverer portal. 

VIII. There are no statutory or regulatory barriers that limit the agency’s ability to take corrective actions to 

address any improper payments. 

IX. The current IPAC system does not allow an agency to refuse a collection against its ALC through the 

General Fund it deems improper. The end result is a requirement to make the payments during the 

accounting period in which the collection was made and reverse the collection at a later date. The ability to 

challenge the collection would reduce the number of improper collections made against the agency. 

 Improper Payments Information Act
 Summary of Financial Statement Audit and Management Assurances

Audit opinion

Restatement

Material Weakness Beginning Balance New Resolved Consolidated

None $0.00

Unqualified

No

Summary of Financial Statement Audit

Table 1.

Statement of Assurances

Material Weakness Beginning Balance New Resolved Consolidated Reassessed Ending Balance

None $0.00 $0.00

Total Material Weaknesses $0.00 0 0 0 0 $0.00

Statement of Assurances

Material Weakness Beginning Balance New Resolved Consolidated Reassessed Ending Balance

None $0.00 $0.00

Total Material Weaknesses $0.00 0 0 0 0 $0.00

Statement of Assurances

Material Weakness Beginning Balance New Resolved Consolidated Reassessed Ending Balance

None $0.00 $0.00

Total Material Weaknesses $0.000 0 0 0 $0.00

Overall Substantial Compliance

1. System Requirements

2. Accounting Standards

3. USSGL at Transaction Level

Table 2.

Summary of Management Assurances

Yes

Yes

Agency Auditor

Yes Yes

Yes

Conform

Compliance with Federal Financial Management Improvement Act (FMFIA)

Unqualified

Effectiveness of Internal Control over Financial Reporting (FMFIA § 2)

Effectiveness of Internal Control over Financial Operations (FMFIA § 2)

Unqualified

Conformance with financial management system requirements (FMFIA § 4)

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FEDERAL MARITIME COMMISSION 

FINAL ANNUAL PERFORMANCE PLAN FOR FY 2009

February 2008 

 Final Annual Performance Plan 2009 
LIST OF ACRONYMS 

 

1984 Act Shipping Act of 1984 

 

AR Area Representative 

 

BCL Bureau of Certification and Licensing 

 

BOE Bureau of Enforcement 

 

BTA Bureau of Trade Analysis 

 

CADRS Office of Consumer Affairs and Dispute Resolution Services 

 

COOP Continuity of Operations Plan 

 

EHR1 Enterprise Human Resources Integration 

 

e-OPF Electronic Official Personnel Folder 

 

FMC/Commission Federal Maritime Commission 

 

FR Final Rule 

 

FRB Federal Reserve Bank 

 

FTE Full Time Equivalent Employee 

 

FY Fiscal Year 

 

GPEA Government Paperwork Elimination Act 

 

GPRA Government Performance and Results Act 

 

IAA Inter-agency Agreement 

 

IT Information Technology 

 

NARA National Archives and Records Administration 

 

NPR Notice of Proposed Rulemaking 

 

NVOCC Non-Vessel-Operating Common Carrier 

 

OIT Office of Information Technology 

 Final Annual Performance Plan 2009 

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 59

OMB Office of Management and Budget 

OPF Official Personnel Folder 

OPM Office of Personnel Management 

OPS Office of Operations 

OSRA Ocean Shipping Reform Act of 1998 

OTI Ocean Transportation Intermediary 

PVO Passenger Vessel Operator 

SAHRC Small Agency Human Resources Consortium 

SC Service Contract 

SOW Statement of Work 

U.S. United States 

VOCC Vessel-Operating Common Carrier 

 

Final Annual Performance Plan 2009 
Final Annual Performance Plan 2009 

INTRODUCTION 

This document comprises the FMC’s Final Annual Performance Plan for FY 2009. As set forth in GPRA and 

general guidelines published by OMB, the Commission has prepared a single Performance Plan so as to present a 

comprehensive picture of performance across the agency. This plan is closely linked to the agency’s Strategic Plan. 

This plan differs from the FMC’s Initial Annual Performance Plan for FY 2009 submitted in September 2007. In 

this final plan, the FMC has developed performance measures and targets that are directly linked to the Outcome 

Goals set forth in the agency’s Strategic Plan. This final plan introduces measures that will evaluate the success 

over time of the Outcome Goals established in the FMC’s Strategic Plan, unlike the initial plan which was confined to annual performance goals encompassing particular, current objectives. It is envisioned that further and 

more comprehensive performance measures will be developed when the Strategic Plan is next updated. That update is scheduled to commence in February, 2008. 

For FY 2009, we have continued the modified approach for our annual planning first implemented with our Revised Annual Performance Plan for FY 2005. Agency performance goals are tied directly to Strategic Goals instead of our budget program activities. This has resulted in the development of performance goals better suited to 

the achievement of agency-wide objectives, as opposed to more narrowly focused goals tailored to the responsibilities of individual units. It also facilitates our aim of utilizing a more inclusive, collaborative approach in conducting our ongoing activities, which we believe both enhances decision-making and improves ultimate results. Addressing our performance goals in this fashion has enabled us to link planning, budgeting and performance more 

effectively. 

The Commission used its existing consultation process in developing this Plan. We continued our ad hoc meetings 

and visits with industry officials to discuss the state of U.S. ocean shipping and the FMC’s oversight responsibilities. In coordination with the various sectors of the maritime industry, we have held periodic briefings by industry 

experts designed to provide Commission staff with valuable information on industry services, operations, business 

practices, and regulatory concerns. The information and opinions we received via these various efforts have assisted us in developing our performance goals and implementing approaches. It is clear that those involved in the 

various sectors of U.S. ocean shipping understand the Commission’s major program activities and, at the same 

time, the Commission is cognizant of the views of all parties with whom it interacts. 

 In line with OMB guidance, the Commission has reflected the resources needed to accomplish its various functions. We have provided FTE and funding figures for each Strategic Goal, which reflect what we believe will be 

required to accomplish the performance goals and steady state functions under each respective Strategic Goal. 

Accordingly, all Commission resources are accounted for in this Plan, i.e., the figures under each Strategic Goal, 

when summed, reflect the full FTE and funding levels of our FY 2009 budget. 

The Commission will post this Final Annual Performance Plan on its Internet website to ensure that it is readily 

accessible to interested parties, and will advise all employees to take the time to review it. Additionally, all employee performance plans are required to comport with the agency’s Strategic and Annual Performance Plans, and 

contain specific elements and standards with a clear explanation of what is expected of the employee in support of 

the agency achieving its goals. This process in turn has the effect of directly furthering the Administration’s initiative on strategic human capital management. Performance of managers and staff is evaluated in part on how they 

achieve the objectives in this plan. 

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Final Annual Performance Plan 2009 

. FMC VISION AND MISSION

The FMCs vision is: 

Fairness and Efficiency in U.S. Maritime Commerce. 

To achieve its vision, the FMC’s mission is to: 

$ Develop and administer policies and regulations that foster a fair, efficient and secure 

maritime transportation system. 

$ Protect U.S. maritime commerce from unfair foreign trade practices and market-distorting 

activities. 

$ Facilitate compliance with U.S. shipping statutes through outreach and oversight. 

$ Assist in resolving disputes. 

OSRA and the events of September 11, 2001, have significantly changed the manner in which the business of 

ocean shipping is being conducted. The industry continues to restructure its operations to adapt to dynamic economic conditions, emerging trends, and maritime security efforts. International trade remains dependent upon an 

efficient ocean transportation system. Therefore, it is imperative for the FMC to ensure that its oversight activities 

produce a competitive trading environment in U.S. ocean commerce that is in harmony with and responsive to international shipping practices, and permits fair and open commerce. We must focus our energies and efforts on 

this mission, and assure that the agency is organized and managed in a manner best suited to accomplish it with a 

minimum of government intervention and regulatory cost. Effective use of emerging information technologies will 

facilitate our efforts. Our actions also must encourage the development of a sound U.S.-flag liner fleet. Accordingly, the FMC has established the following five strategic goals to carry out its statutory mandates. 
Final Annual Performance Plan 2009 

FMC STRATEGIC GOALS

1. Efficient Regulatory Process: Provide a timely, efficient and decisive regulatory process, including alternative dispute resolution, to enable all segments of the industry to operate more effectively, with a minimum of regulatory costs. 

2. Compliance: Promote efficiency and fairness in U.S. foreign waterborne commerce through various 

means, including outreach and monitoring, to protect the public and assist stakeholders in achieving compliance with ocean transportation statutes administered by the FMC. 

3. Balanced Enforcement: Foster economic efficiencies, reliance on marketplace factors and maritime security by administering U.S. shipping statutes in a balanced and equitable manner to redress excessive anticompetitive actions and other unlawful activities. 

4. Technological Efficiencies: Employ technological enhancements to improve efficiency and to facilitate 

the exchange of information. 

5. Management Capabilities: Ensure the FMC has the appropriate organizational framework and management systems to carry out its statutory mandates. 

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Final Annual Performance Plan 2009 

LINKAGE BETWEEN MISSION STATEMENT 

AND STRATEGIC GOALS 

Our strategic goals address essential FMC statutory, programmatic, and management responsibilities. They were 

developed with a specific focus on accomplishing the basic purposes of our mission and attaining the competitive, 

nondiscriminatory shipping environment envisioned by the 1984 Act, as amended by OSRA. 

The primary intention of Strategic Goal 1 is to minimize regulatory costs by maintaining timely and decisive regulatory processes, and providing various dispute resolution services. This will render the FMC more effective in 

addressing discrimination or other actions that preclude industry efficiency, while reducing the costs of pursuing 

matters before the Commission. Decisive action and effective assistance in resolving informal complaints or disputes will help to remove uncertainties as to statutory interpretations or the application of FMC rules. Such uncertainties may impede operational efficiencies or technological changes, each of which can foster a more economical 

ocean shipping system. 

Our second strategic goal centers on achieving compliance with the substantive provisions of the shipping statutes 

the FMC administers, and protecting those involved in U.S. ocean commerce from unfair practices. We will address this goal particularly by interacting with all sectors of the industry, and by vigilant monitoring of ongoing 

commercial activities. Accomplishing this goal should minimize the unjust discrimination and undue preference or 

prejudice that precludes certain shipping interests from obtaining rates or service levels that can render their businesses more economic and efficient. Increasing industry compliance should enable stakeholders to concentrate on 

fair and legal means of enhancing operational efficiency, secure in the knowledge that competitors are not engaging in widespread illegal actions aimed at improving short-term profits. The agency’s focus on the qualifications 

of intermediaries operating in the U.S. trades will afford greater protection to our stakeholders and contribute to 

national maritime security. And cruise passengers also will be protected through the demonstration of financial 

responsibility by passenger vessel operators. 

Strategic Goal 3 is designed to foster economic efficiencies, assist maritime security initiatives, promote reliance 

on marketplace factors, and redress excessive anticompetitive practices harmful to international commerce. This is 

a direct link to our mission statement’s call for an efficient, secure, competitive, market-driven ocean transportation system. Our continuing efforts to address the actions of foreign governments that adversely affect U.S. interests and our foreign trade comport with that aspect of our mission aimed at creating an environment A free of unfair foreign maritime trade practices. Our focus on commercial malpractices enhances our objective of limiting 

unlawful activities. 

We also have a specific strategic goal that focuses on making effective use of advancements in IT to improve the 

efficiency of our operations and enhance our exchange of information with external parties. Carrying out the 

agency’s mission in times of budgetary limitations dictates that we appropriately utilize all available resources. 

Dynamic changes continue to be made in this area, and the Commission intends to take advantage of any improvement that can enable it to perform its functions more effectively. We hope to improve our business operations so 

as to add efficiency to the Commission’s dissemination and receipt of information. We intend to perform the research and analysis necessary to identify the best options for implementing technical enhancements to facilitate our 

efforts to achieve our mission. 

Finally, our fifth strategic goal addresses Commission management and operations. In order to achieve the objectives of our mission, we must maintain effective processes that enhance efficiency, without serving as ends in 

themselves. It is essential that we manage for results, and that we effectively tie our budget needs to our performance. This strategic goal serves as the internal underpinning that enables us to accomplish the policy objectives set 

forth in our mission statement. This goal also ensures continuation of a comprehensive approach to the strategic 

management of our human capital. 
Final Annual Performance Plan 2009 

Achieving these mission-driven goals will enable us to address the external factors we face, while assuring an equitable and efficient administration of the shipping statutes under our jurisdiction. Our processes and procedures will 

be refined or updated as necessary. We are committed to accomplishing our strategic goals and the Outcome 

Goals related to them. Therefore, specific means have been identified to enable the FMC to achieve these goals in 

the most cost-efficient and least disruptive manner possible. 

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Final Annual Performance Plan 2009 

Strategic Goal No. 1: Efficient Regulatory Process 

Provide a timely, efficient and decisive regulatory process, including alternative dispute resolution, to enable all 

segments of the industry to operate more effectively, with a minimum of regulatory costs. 

43 FTEs and $8,500,000.00 will be required to accomplish this goal. 

A. Steady State Activities:

$ Adjudication and resolution of complaints. 

$ Adjudication and resolution of investigatory proceedings, including fact-findings and show cause 

proceedings. 

$ Issuance of rules through the rulemaking process. 

$ Commission decision-making activities through meetings (formal and notation) that comply with 

the Government in the Sunshine Act. 

$ Public information and assistance processes such as press relations, responses to legislative and 

regulatory inquiries, and compliance with Freedom of Information Act and Privacy Act requirements. 

$ Other regulatory processes, including activities such as appeals of delegated authority actions, 

policy issuances, and formal petition processes. 

$ Providing timely legal counsel to the Commission in order to facilitate regulatory action that is 

consistent with statutory mandates, representing the Commission’s interest in matters before 

Congress and OMB. 

$ Reviewing and refining Commission rules to determine their economic impact and ensure that 

they reflect the current industry environment, as well as meet the needs of the Commission’s 

regulatory mandate. 

$ Compiling, organizing, and maintaining Commission records. 

$ Monitor, review and modify, as necessary, Commission regulations to address changing trade 

conditions, industry practices or statutory modifications. 

B. Outcome Goals 

 

Outcome Goal 1.1: Provide parties to proceedings with alternative means to resolve their disputes, 

including informal ADR, and encourage their use. 

Measure: Disputes resolved by Office of Consumer Affairs and Dispute Resolution Services 

 Target: 100 

Outcome Goal 1.2: Conduct hearings in an expeditious and equitable manner, so that litigants and 

the industry can adjust their behavior accordingly. 

Measure: Percentage of complaints or investigations completed within two years of filing or 

Commission initiation beginning with cases filed or initiated in FY 2007. 

Target: 60% 

Outcome Goal 1.3: Permit and encourage the use of electronic filings and other processes that result in less expense and timely resolution of disputes. 

Measure: Percentage of Active Electronic Docket Logs updated within 72 hours of receipt of 

key documents issued or filed in Commission proceedings. Target: 85% 
Final Annual Performance Plan 2009 

Outcome Goal 1.4: Update Commission rules as appropriate to adjust to changes in the regulatory 

and commercial environment. 

Measure: Number of rules pending in Unified Regulatory Agenda. 

Target: 2 

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Final Annual Performance Plan 2009 

Strategic Goal No. 2: Compliance 

Promote efficiency and fairness in U.S. foreign waterborne commerce through various means, including outreach 

and monitoring, to protect the public and assist stakeholders in achieving compliance with ocean transportation 

statutes administered by the FMC. 

31 FTEs and $5,388,000.00 will be required to accomplish this goal. 

A. 2009 Steady State Activities:

$ Reviewing and maintaining a database of SCs between (also NSAs between NVOCCS) ocean 

common carriers and shippers, and using this database to guard against anticompetitive practices 

and other unfair prohibited activities under the 1984 Act. 

$ Ensuring that common carriers’ rates and charges are accessible to the shipping public in private, 

electronically accessible systems. 

$ Ensuring that OTIs maintain bonds that protect the shipping public from financial losses. 

$ Providing formal and informal legal opinions and guidance to the Commission’s staff and the 

general public to ensure clarity and understanding of Commission rules and regulations. 

$ Administering the Commission’s international affairs program. 

$ Coordinate with other agencies regarding maritime security. 

$ Reviewing operational and pricing agreements among ocean common carriers and marine terminals to ensure that they do not unduly restrict competition. 

$ Issuing passenger vessel certificates evidencing financial responsibility of vessel owners or charterers to pay judgments for personal injury or death or to repay fares for the nonperformance of 

voyage or cruise. 

$ Licensing OTIs to protect the public from unqualified, insolvent, or dishonest companies. 

$ Responding to informal complaints and informal inquiries from Congress and the public relating 

to Commission responsibilities. 

$ Acting as a liaison between the FMC and the public by responding and/or coordinating agency 

responses to public inquiries. 

$ Maintaining a specialized maritime law library for agency and public use. 

$ Conducting audit activity of regulated entities, including OTIs and VOCCs, to promote and ensure compliance with applicable statutes and Commission regulations. 

$ Responding to inquiries and complaints from the regulated industry and shipping public. Providing information, assistance and forms necessary to comply with applicable statutes and Commission regulations including educational seminars. 

B. Outcome Goals 

 

Outcome Goal 2.1: Increase the rate of compliance under applicable U.S. shipping laws and regulations relating to tariffs, service contracts, unfair trade practices, antitrust immunity, discriminatory 

practices, carrier pricing and service, ocean transportation intermediary activities, and passenger 

vessel operations. 

Measure: Percentage of minutes and monitoring reports received within regulatory deadlines or 

formal extension.

 Target: 95% 

Measure: Percentage of new and amended OTI applications that are processed within 45 days. 

Target: 80% 
Final Annual Performance Plan 2009 

Outcome Goal 2.2: Conduct educational programs and provide opportunity for informal exchanges between our stakeholders and the Commission. 

Measure: Number of industry entities invited to address Commission staff. 

Target: 3 

Measure: Presentation, panel participation and attendance by staff at trade conferences. 

Target: 3 

Outcome Goal 2.3: Maintain fair competition in U.S. ocean commerce.

Measure: Achieve positive outcomes in matters for which formal request for additional information is made to parties of filed ocean common carrier or marine terminal operator agreements. 

Target: 90 % 

Outcome Goal 2.4: Protect the public and users of ocean transportation services from activities 

that violate the shipping statutes. 

Measure: Number of investigations opened to address alleged harm to the public as a result of 

Shipping Act violations.

Target: 50 

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Final Annual Performance Plan 2009 

Strategic Goal No. 3: Balanced Enforcement 

Foster economic efficiencies, reliance on marketplace factors and maritime security by administering U.S. shipping statutes in a balanced and equitable manner to redress excessive anticompetitive actions and other unlawful 

activities. 

16 FTEs and $2,861,000.00 will be required to accomplish this goal. 

A. 2009 Steady State Activities:

$ Investigating discriminatory rates, charges, classifications, and practices of common carriers, 

terminal operators, and OTIs operating in the foreign commerce of the U.S. 

$ Representing the FMC before U.S. courts and other administrative agencies. 

$ Reviewing staff recommendations and initial decisions for legal sufficiency and preparing final 

decisions and orders. 

$ Regulating rates, charges, and rules of government-owned or -controlled carriers to ensure that 

they are just and reasonable and are not unfairly undercutting private competitors. 

$ Protecting shippers and carriers engaged in the foreign commerce of the U.S. from restrictive or 

unfair foreign laws, regulations or business practices that harm U.S. shipping interests or ocean 

trade. 

$ Prosecuting formal proceedings initiated by the Commission. 

$ Monitoring activities and conducting investigations of regulated entities and of SC activity to 

ensure compliance with statutes and regulations administered by the Commission. 

$ Conducting non-adjudicatory fact-finding proceedings as directed by the Commission. 

$ Providing liaison between the Commission and the shipping industry, the public and other governmental entities. 

$ Coordinating and cooperating with other government entities to improve homeland security by 

effective exchange of information and assistance regarding foreign ocean transportation. 

B. Outcome Goals 

 

Outcome Goal 3.1: Assure carriers do not exercise their antitrust immunity in a manner that results in unreasonable practices, rate increases or service decreases.

 

 Measure: Percentage of rate agreements analyzed for 6(g) compliance. 

 Target: 100% 

Measure: Number of memoranda, special reports or studies on significant competition related 

issues. 

Target: 3 
Outcome Goal 3.2: Ensure that Commission actions are taken with appropriate consideration of 

their impact on the industry and users of transportation services, including small business considerations, and are directed at market-distorting activities. 

Measure: Number of unaddressed comments received in rulemakings regarding SBREFA concerns. 

 Target: 0 

Outcome Goal 3.3: Provide regulatory assistance and encourage voluntary compliance with shipping statutes and regulations through consistent industry outreach and education efforts.

Measure: Number of compliance presentations by staff to industry and shipping public. 

Target: 3 

Outcome Goal 3.4: Neutralize, or affirmatively address, restrictive trade practices of foreign governments.

Measure: Number of unresolved FSPA and Section 19 proceedings. 

Target: No more than 2 

Outcome Goal 3.5: Improve maritime security by curtailing unlawful participation in the U.S. 

ocean transportation system. 

Measure: Percentage of identified unlicensed OTIs sent compliance warning letters. 

Target: 95% 

Final Annual Performance Plan 2009 

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Strategic Goal No. 4: Technological Efficiencies 

Employ technological enhancements to improve efficiency and to facilitate the exchange of information. 

17 FTEs and $2,987,000.00 will be required to accomplish this goal. 

A. 2009 Steady State Activities:

$ Implementing a wide range of IT programs and services, including operating the agency’s local 

area network, strategic planning for short- and long-term IT initiatives, IT security, data telecommunications, database development and management, and Internet page development and maintenance to enhance productivity and efficiency. 

$ Maintaining and updating internal databases to enhance the ability of the public and Commission 

to obtain relevant program-related information and enhance staff productivity. 

$ Converting Commission records into electronic format to enable easier public access to information. 

B. Outcome Goals 

Outcome Goal 4.1: Streamline the Commission's work processes through effective utilization of 

information technology.

Measure: The number of technology solutions that are designed and implemented and used by 

the Commission to facilitate process improvement through the use of databases and recordkeeping systems. 

Target: 6 

 

Measure: Cumulative number of technology solutions that are designed and implemented and 

used by the Commission to facilitate process improvement through the use of databases and recordkeeping systems since FY 2007 (including current fiscal year). 

Target: 12 

Outcome Goal 4.2: Use electronic technology for the receipt of documents filed with the Commission as envisioned by the Government Paperwork Elimination Act ("GPEA"). 

Measure: Percentage use of electronically submitted forms by regulated concerns versus receipt 

of traditional paper-driven applications and processes. 

Target: 50% 

Final Annual Performance Plan 2009 
Outcome Goal 4.3: Safeguard programs and systems as required by the Federal Information Security Management Act of 2002 (“FISMA”). 

Measure: Number of technology-related programs and systems developed or implemented that 

achieve full compliance with Federal information security mandates. 

Target: 12 

Outcome Goal 4.4: Disseminate Commission and staff issuances through the use of electronic technology. 

Measure: The total number of visits and downloads from agency website. 

Target: 10 percent increase measured against previous year website traffic statistics, FY 2007 - 

2009. 

Final Annual Performance Plan 2009 

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Strategic Goal No. 5: Management Capabilities 

Ensure the FMC has the appropriate organizational framework and management systems to carry out its statutory 

mandates. 

24 FTEs and $4,217,000.00 will be required to accomplish this goal. 

A. 2009 Steady State Activities:

$ Executing financial management policies and programs, including developing annual budget 

justifications for submission to the Congress and OMB, managing agency appropriations, administering internal control systems for agency funds, travel and cash management, and coordinating 

with contractors who provide accounting and payroll services. 

$ Fostering human resources management principles, including recruitment and placement, position classification and pay administration, occupational safety and health, employee assistance, 

employee relations, workforce discipline, performance management and incentive awards, employee benefits, career transition, retirement, employee development and training, personnel security, and an equal employment opportunity. 

$ Ensuring the program operations of the agency are administratively supported via telecommunications, procurement of administrative goods and services, property management, space, printing 

and copying, mail and records services, facilities and equipment maintenance, and transportation. 

$ Promoting economy and efficiency in the administration of, and protecting and detecting waste, 

fraud and abuse in, the agency’s programs via auditing agency operations. 

$ Providing guidance to staff regarding administrative matters, including procurement, personnel 

and contracting issues. 

$ Ensuring program compliance with various rules and regulations regarding such areas as forms 

clearance, Paperwork Reduction, Small Business Paperwork Reduction Act, and other Federally 

required reports and submissions. 

B. Outcome Goals 

Outcome Goal 5.1: Organize and manage the agency's staff consistent with established priorities, 

with an emphasis on workforce planning, diversity, and effective internal communication. 

Measure: Percentage of agency employees who participated in required annual training during 

the fiscal year (e.g., ethics, IT security, No FEAR, etc.). 

Target: 100% 

Measure: Number of awareness, recruitment, training, new-employee orientation, 

workforce development, and quality of life initiatives offered to agency employees. 

Target: 250 

Final Annual Performance Plan 2009 
Outcome Goal 5.2: Clearly and accurately communicate the Commission's program requirements, 

activities and decisions in a manner consistent with the Information Quality Guidelines for Federal 

Agencies. 

Measure: Percentage of internal Commission orders or SOPs reviewed, developed or updated by 

Office of Administration during the fiscal year. 

Target: 33% 

Measure: Percentage of agency records which have been assessed with respect to records disposition requirements with respect to the current fiscal year. 

Target: 33% 

Outcome Goal 5.3: Respond to changing industry conditions and business environment through 

use of state-of-the-art automated systems for internal and external processes and a flexible and well

-trained workforce. 

Measure: Percentage of agency employees who participated in optional skill-building, management and other training during the current fiscal year. 

Target: 25% 

Measure: Percent of payments (user fees, penalties, etc.) received electronically via Pay.gov versus older technologies (e.g., checks). 

Target: 25% 

Outcome Goal 5. 4: Enhance performance and accountability through linking planning, financial 

management and performance. 

Measure: Percentage of management officials undertaking reviews of internal controls and vulnerability assessments for their programs during the current fiscal year. 

Target: 95% 

 

Measure: Number of material deficiencies found in most recent financial statement audit. 

Target: 1 or fewer 

Measure: Received “unqualified opinion” from financial statement auditors with respect to the 

current fiscal year. 

Target: Yes 

Final Annual Performance Plan 2009 

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CHAPTER FOUR 

OTHER ACCOMPANYING INFORMATION