23

FMCS – 2020 Financial Statement Audit 

Contract: GS23F0111L/ FMCS-2018-TO-0001

Federal Mediation and Conciliation Service (FMCS) 

Fiscal Year 2020 Financial Statement Audit

Final Independent Auditors’ Report

Submitted for review and acceptance to:

Terry Lee

Contracting Officer's Representative (COR) 

Federal Mediation and Conciliation Service 

250 E St SW

Washington, DC 20427

Submitted by:

Jason L. Allmond CPA, CGFM, CISA, CISM 

Member

Allmond & Company, LLC 

7501 Forbes Blvd, Suite 200

Lanham, MD 20706

301-918-8200

jallmond@allmondcpa.com

Final Independent Auditors’ Report

Prepared under contract to the Federal Mediation and Conciliation Service (FMCS) to provide financial auditing 

services
24

FEDERAL MEDIATION AND CONCILIATION SERVICE

AUDIT REPORT 

SEPTEMBER 30, 2020

ALLMOND & COMPANY, LLC

Certified Public Accountants 

7501 Forbes Blvd, Suite 200

Lanham, Maryland 20706

(301) 918-8200
25

Independent Auditors’ Report

The Director

Federal Mediation and Conciliation Service:

Report on the Financial Statements

We have audited the accompanying financial statements of the Federal Mediation and Conciliation 

Service, which comprise the balance sheets as of September 30, 2020 and 2019; the related statements of 

net cost, changes in net position, and budgetary resources for the fiscal years ended; and the related notes 

to the financial statements (hereinafter referred to as the financial statements).

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in 

accordance with accounting principles generally accepted in the United States of America; this 

responsibility includes the design, implementation, and maintenance of internal control relevant to the 

preparation and fair presentation of financial statements that are free from material misstatement, whether 

due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on the fiscal years 2020 and 2019 financial statements of 

FMCS based on our audits. We conducted our audits in accordance with auditing standards generally 

accepted in the United States of America; the standards applicable to financial audits contained in 

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

Management and Budget (OMB) Bulletin No. 19-03, Audit Requirements for Federal Financial 

Statements. Those standards and OMB Bulletin No. 19-03 require that we plan and perform the audit to 

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

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in 

the financial statements. The procedures selected depend on the auditors' judgment, including the 

assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. 

In making those risk assessments, the auditor considers internal control relevant to the entity's preparation 

and fair presentation of the financial statements in order to design audit procedures that are appropriate in 

the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity' s 

internal control. Accordingly, we express no such opinion.

An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness 

of significant accounting estimates made by management, as well as evaluating the overall presentation of 

the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for 

our audit opinion.
26

Independent Auditors’ Report

Opinion

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

financial position of the Federal Mediation and Conciliation Service as of September 30, 2020 and 2019, 

and its net cost of operations, changes in net position, and budgetary resources for the years then ended in 

accordance with accounting principles generally accepted in the United States of America.

Other Matters

Required Supplementary Information

The information in the Message from the Director, Management Discussion and Analysis section, and 

Other Accompanying Information section of this report is not a required part of the basic financial 

statements, but is supplementary information required by accounting principles generally accepted in the 

United States of America. We have applied certain limited procedures, which consisted principally of 

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

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

and other knowledge we obtained during our audit of FMCS’s financial statements. However, we did not 

audit this information and, accordingly, we express no opinion on it.

Other Reporting Required by Government Auditing Standards

Internal Control over Financial Reporting

In planning and performing our audit of FMCS’s financial statements as of and for the year ended 

September 30, 2020, in accordance with generally accepted government auditing standards, we 

considered FMCS’s internal control over financial reporting as a basis for designing audit procedures that 

are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, 

but not for the purpose of expressing an opinion on the effectiveness of FMCS’s internal control over 

financial reporting. Accordingly, we do not express an opinion on FMCS’s internal controls over 

financial reporting. We limited internal control testing to those necessary to achieve the objectives 

described in OMB Bulletin No. 19-03. We did not test all internal control relevant to operating objectives 

as broadly defined by the Federal Managers’ Financial Integrity Act of 1982.

A deficiency in internal control exists when the design or operation of a control does not allow 

management or employees, in the normal course of performing their assigned functions, to prevent, or 

detect and correct misstatement on a timely basis. A material weakness is a deficiency, or combination of 

deficiencies, such that there is a reasonable possibility that a material misstatement of the entity’s 

financial statements will not be prevented, or detected and corrected, on a timely basis. A significant 

deficiency is a deficiency or a combination of deficiencies, in internal control that is less severe than a 

material weakness yet important enough to merit the attention by those charged with governance.

Our consideration of internal control over financial reporting was for the limited purpose as described in 

the first paragraph of this section, and was not designed to identify all deficiencies in internal control over 

financial reporting that might be material weaknesses or significant deficiencies and therefore material 

weaknesses or significant deficiencies may exist that were not identified. Given these limitations, during 

our fiscal year 2020 audit we did not identify any deficiencies in internal control over financial reporting 

that we considered to be a material weakness, as defined above. However, material weaknesses may exist 

that have not been identified.

Exhibit I presents the status of prior year findings and recommendations.
27

Independent Auditors’ Report

Furthermore, we noted an additional matter that we will report to FMCS management in a separate letter.

Compliance and Other Matters Specific to the Financial Statements

As part of obtaining reasonable assurance about whether FMCS’s fiscal year 2020 financial statements 

are free of material misstatements, we performed tests of FMCS’s compliance with certain provisions of 

applicable laws, regulations, contracts, and grant agreements, which noncompliance could have a direct 

and material effect on the determination of material amounts and disclosures in FMCS’s financial 

statements, and certain provisions of other laws specified in OMB Bulletin No. 19-03. However, 

providing an opinion on compliance with those provisions was not an objective of our audit, and 

accordingly, we do not express such an opinion.

The results of our tests of compliance as described in the preceding paragraph disclosed no instances of 

noncompliance or other matters that are required to be reported herein under Government Auditing 

Standards or OMB Bulletin No. 19-03.

Purpose of the Other Reporting Required by Government Auditing Standards

The purpose of the communication provided in the Other Reporting Required by Government Auditing 

Standards section is solely to describe the scope of our testing of internal control and compliance with 

selected provisions of applicable laws, regulations, contracts, and grant agreements, and the results of that 

testing, and not to provide an opinion on the effectiveness of the FMCS’s internal control or on 

compliance. This communication is an integral part of an audit performed in accordance with U.S. 

generally accepted government auditing standards in considering internal controls and compliance with 

laws, regulations, contracts, and grant agreements which could have a material effect FMCS’s financial 

statements. Accordingly, this communication is not suitable for any other purpose.

Allmond & Company, LLC Lanham, MD 

November 16, 2020
28

Independent Auditors’ Report

Exhibit I

Status of Prior Year Findings

The following table provides the fiscal year (FY) 2020 status of all recommendations included in the 

Independent Auditors' Report on the FY 2020 Financial Statement Audit’s FY 2019 Financial Statements 

(November 15, 2019).

FY 2019

Finding

FY 2019 Recommendations FY 2020

Status

Lack of 

Sufficient 

Internal 

Controls over 

Financial 

Reporting for 

Upward and 

Downward 

Adjustments of 

Prior Year 

Obligations 

(2019-01)

Recommendation:

1. Enhance current review process, to ensure all transactions are 

recorded completely, accurately and in compliance with the 

USSGL.

2. Implement a policy and procedure to identify on a quarterly basis 

upward adjustments and downward adjustments that should not be 

recorded to the general ledger so that adjustments can be recorded 

to properly state ending balances.

Closed

Internal 

Controls over 

Journal 

Vouchers are 

Not Properly 

Designed and 

Implemented 

(2019-05)

Recommendation:

1. Design and implement policies and procedures to verify that the 

correct entries are recorded in GLOWS.

2. Provide additional training on the USSGL guidance for properly 

recording transactions.

Closed
29

FEDERAL MEDIATION AND CONCILIATION SERVICE

FINANCIAL STATEMENTS

FOR THE YEARS ENDED

SEPTEMBER 30, 2020 AND 2019
30

FEDERAL MEDIATION AND CONCILIATION SERVICE 

FINANCIAL STATEMENTS

FOR THE YEARS ENDED SEPTEMBER 30, 2020 AND 2019

TABLE OF CONTENTS

BALANCE SHEET...................................................................................................... 31

STATEMENT OF NET COST....................................................................................... 32

STATEMENT OF CHANGES IN NET POSITION............................................................... 33

STATEMENT OF BUDGETARY RESOURCES.................................................................. 34

NOTES TO THE FINANCIAL STATEMENTS................................................................... 35-46
31

2020 2019

FEDERAL MEDIATION AND CONCILIATION SERVICE 

BALANCE SHEET

AS OF SEPTEMBER 30, 2020 AND 2019

(In Dollars)

Assets:

Intragovernmental

Fund Balance With Treasury (Note 2) $ 12,690,845 $ 12,177,071

Accounts Receivable (Note 3) 206,724 18,574

Total Intragovernmental 12,897,569 12,195,645

Accounts Receivable, Net (Note 3) 10,626 -

General Property, Plant, and Equipment, Net (Note 4) 326,432 309,212

Total Assets $ 13,234,627 $ 12,504,857

Liabilities:

Intragovernmental 

Other (Note 6) $ 664,108 $ 633,746

Total Intragovernmental 664,108 633,746

Accounts Payable 204,339 173,225

Federal Employee and Veteran Benefits 1,654,304 1,752,946

Other (Note 6) 4,679,949 3,693,478

Total Liabilities $ 7,202,700 $ 6,253,395

Net Position:

Unexpended Appropriations - All Other Funds $ 7,368,885 $ 7,635,205

Cumulative Results of Operations - All Other Funds (1,336,958) (1,383,743)

Total Net Position $ 6,031,927 $ 6,251,462

Total Liabilities and Net Position $ 13,234,627 $ 12,504,857
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2020 2019

FEDERAL MEDIATION AND CONCILIATION SERVICE 

STATEMENT OF NET COST

FOR THE YEARS ENDED SEPTEMBER 30, 2020 AND 2019

(In Dollars)

Gross Program Costs:

Gross Costs $ 50,998,860 $ 52,114,505

Less: Earned Revenue (2,173,278) (2,341,178)

Net Cost of Operations $ 48,825,582 $ 49,773,327
33

FEDERAL MEDIATION AND CONCILIATION SERVICE 

STATEMENT OF CHANGES IN NET POSITION

FOR THE YEARS ENDED SEPTEMBER 30, 2020 AND 2019

(In Dollars)

2020 2019

Unexpended Appropriations:

Beginning Balances, as Adjusted 7,635,205 8,893,986

Budgetary Financing Sources:

Appropriations Received 47,200,000 46,650,000

Other Adjustments (150,896) (709,985)

Appropriations Used (47,315,424) (47,198,796)

Total Budgetary Financing Sources (266,320) (1,258,781)

Total Unexpended Appropriations $ 7,368,885 $ 7,635,205

Cumulative Results of Operations:

Beginning Balances, as Adjusted (1,383,743) (895,365)

Budgetary Financing Sources:

Appropriations Used 47,315,424 47,198,796

Other Financing Sources (Non-Exchange):

Imputed Financing (Note 9) 1,556,943 2,086,153

Total Financing Sources 48,872,367 49,284,949

Net Cost of Operations (48,825,582) (49,773,327)

Net Change 46,785 (488,378)

Cumulative Results of Operations $ (1,336,958) $ (1,383,743)

Net Position $ 6,031,927 $ 6,251,462
34

FEDERAL MEDIATION AND CONCILIATION SERVICE 

STATEMENT OF BUDGETARY RESOURCES

FOR THE YEARS ENDED SEPTEMBER 30, 2020 AND 2019

(In Dollars)

2020 2019

Budgetary Resources:

Unobligated balance from prior year budget authority, net (discretionary and mandatory) (Note 10) $ 6,955,844 $ 6,220,935

Appropriations 47,200,000 46,650,000

Spending authority from offsetting collections 2,594,624 2,342,206

Total Budgetary Resources $ 56,750,468 $ 55,213,141

Status of Budgetary Resources:

New obligations and upward adjustments (total) (Note 11) $ 49,215,749 $ 48,193,226

Unobligated balance, end of year:

Apportioned, unexpired account 1,201,633 2,330,346

Unapportioned, unexpired accounts 2,522,000 1,572,655

Unexpired unobligated balance, end of year 3,723,633 3,903,001

Expired unobligated balance, end of year 3,811,086 3,116,914

Unobligated balance, end of year (total) 7,534,719 7,019,915

Total Budgetary Resources $ 56,750,468 $ 55,213,141

Outlays, Net and Disbursements, Net:

Outlays, net (total) 46,535,330 47,883,770

Agency outlays, net 46,535,330 47,883,770
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FEDERAL MEDIATION AND CONCILIATION SERVICE 

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Reporting Entity

The Federal Mediation and Conciliation Service (the FMCS) is an independent Federal agency 

whose primary mission is to prevent or minimize labor-management disputes affecting interstate 

commerce by providing mediation, conciliation, and voluntary arbitration. These activities are 

performed in both the private and public sectors, except for the railroad and airline industries, 

which are covered by the Railway Labor Act and the National Mediation Board, respectively. As 

of September 30, 2020, the FMCS consisted of a national office, 8 district offices, and 11 field 

offices. The FMCS reporting entity is comprised of General Funds and General Miscellaneous 

Receipts.

General Funds are accounts used to record financial transactions arising under congressional 

appropriations or other authorizations to spend general revenues. The FMCS manages Operations 

and Facilities, Engineering and Development General Fund accounts.

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.

The FMCS has rights and ownership of all assets reported in these financial statements. The 

reporting entity is a component of the U.S Government. For this reason, some of the assets and 

liabilities reported by the entity may be eliminated for Government-wide reporting because they 

are offset by assets and liabilities of another U.S. Government entity. These financial statements 

should be read with the realization that they are for a component of the U.S. Government, a 

sovereign entity. The FMCS does not possess any non-entity assets.

B. Basis of Presentation

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

operations of the FMCS. The Balance Sheet presents the financial position of the agency. The 

Statement of Net Cost presents the agency’s operating results; the Statement of Changes in Net 

Position displays the changes in the agency’s equity accounts. The Statement of Budgetary 

Resources presents the sources, status, and uses of the agency’s resources and follows the rules 

for the Budget of the United States Government.

The statements are a requirement of the Chief Financial Officers Act of 1990, the Government 

Management Reform Act of 1994 and the Accountability of Tax Dollars Act of 2002. They have 

been prepared from, and are fully supported by, the books and records of The FMCS in 

accordance with the hierarchy of accounting principles generally accepted in the United States of 

America, standards issued by the Federal Accounting Standards Advisory Board (FASAB), 

Office of Management and Budget (OMB) Circular A-136, Financial Reporting Requirements, as 

amended, and the FMCS 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 FMCS’s use of budgetary resources. The financial statements and
36

associated notes are presented on a comparative basis. Unless specified otherwise, all amounts 

are presented in dollars.

C. Basis of Accounting

Transactions are recorded on both an accrual accounting basis and a budgetary basis. Under the 

accrual method, revenues are recognized when earned, and expenses are recognized when a 

liability is incurred, without regard to receipt or payment of cash. Budgetary accounting 

facilitates compliance with legal requirements on the use of federal funds.

D. Fund Balance with Treasury

FBWT is an asset of a reporting entity and a liability of the General Fund. It is the aggregate 

amount of the FMCS’s funds with Treasury in expenditure, receipt, and deposit fund accounts. 

Appropriated funds recorded in expenditure accounts are available to pay current liabilities and 

finance authorized purchases.

The FMCS does not maintain bank accounts of its own, has no disbursing authority, and does not 

maintain cash held outside of Treasury. Funds are disbursed for the agency on demand. Foreign 

currency payments are made either by Treasury or the Department of State and are reported by 

the FMCS in the U.S. dollar equivalents.

E. Accounts Receivable

Accounts receivable consists of amounts owed to the FMCS by other federal agencies and the 

general public. Amounts due from federal agencies are considered fully collectible. Accounts 

receivable from the public include reimbursements from employees and non-federal reimbursable 

work. An allowance for uncollectible accounts receivable from the public is established when, 

based upon a review of outstanding accounts and the failure of all collection efforts, management 

determines that collection is unlikely to occur considering the debtor’s ability to pay.

F. Property, Equipment, and Software

Property, equipment and software represent furniture, fixtures, equipment, and information 

technology hardware and software which are recorded at original acquisition cost and are 

depreciated or amortized using the straight-line method over their estimated useful lives. Major 

alterations and renovations are capitalized, while maintenance and repair costs are expensed as 

incurred. The FMCS’s capitalization threshold is $5,000 for individual purchases and a total 

useful life exceeding on year. Property, equipment, and software acquisitions that do not meet 

the capitalization criteria are expensed upon receipt. Applicable standard governmental 

guidelines regulate the disposal and convertibility of agency property, equipment, and software. 

Calculating depreciation is on an estimated useful life of five (5) years for software, equipment, 

and capital lease assets.

G. Liabilities

Liabilities represent the amount of funds likely to be paid by the FMCS as a result of transactions 

or events that have already occurred.

The FMCS reports its liabilities under two categories, Intragovernmental and With the Public. 

Intragovernmental liabilities represent funds owed to another government agency. Liabilities
37

with the Public represent funds owed to any entity or person that is not a federal agency, 

including private sector firms and federal employees. Each of these categories may include 

liabilities that are covered by budgetary resources and liabilities not covered by budgetary 

resources.

Liabilities covered by budgetary resources are liabilities funded by a current appropriation or

other funding source. These consist of accounts payable and accrued payroll and benefits. 

Accounts payable represent amounts owed to another entity for goods ordered and received and 

for services rendered except for employees. Accrued payroll and benefits represent payroll costs 

earned by employees during the fiscal year which are not paid until the next fiscal year.

Liabilities not covered by budgetary resources are liabilities that are not funded by any current 

appropriation or other funding source. These liabilities consist of accrued annual leave, actuarial 

FECA, and the amounts due to Treasury for collection and accounts receivable of civil penalties 

and FOIA request fees.

H. Annual, Sick, and Other Leave

Annual leave is accrued as it is earned, and the accrual is reduced as leave is taken. The balance 

in the accrued leave account is adjusted to reflect current pay rates. Liabilities associated with 

other types of vested leave, including compensatory, restored leave, and sick leave in certain 

circumstances, are accrued at year-end, based on latest pay rates and unused hours of leave. 

Funding will be obtained from future financing sources to the extent that current or prior year 

appropriations are not available to fund annual and other types of vested leave earned but not 

taken. Nonvested leave is expensed when used. Any liability for sick leave that is accrued but 

not taken by a Civil Service Retirement System (CSRS)-covered employee is transferred to the 

Office of Personnel Management (OPM) upon the retirement of that individual. Credit is given 

for sick leave balances in the computation of annuities upon the retirement of Federal Employees 

Retirement System (FERS)-covered employees.

I. Accrued and Actuarial Workers’ Compensation

The Federal Employees' Compensation Act (FECA) administered by the U.S. Department of 

Labor (DOL) addresses all claims brought by the FMCS employees for on-the-job injuries. The 

DOL bills each agency annually as its claims are paid, but payment of these bills is deferred for 

two years to allow for funding through the budget process. Similarly, employees that the FMCS 

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 the net present value of estimated future payments calculated by the DOL.

J. Retirement Plans

The FMCS employees participate in either the CSRS or the FERS. The employees who 

participate in CSRS are beneficiaries of the FMCS matching contribution, equal to seven percent 

of pay, distributed to their annuity account in the Civil Service Retirement and Disability Fund.

Prior to December 31, 1983, all employees were covered under the CSRS program. From 

January 1, 1984 through December 31, 1986, employees had the option of remaining under CSRS 

or joining FERS and Social Security. Employees hired as of January 1, 1987 are automatically 

covered by the FERS program. Both CSRS and FERS employees may participate in the federal
38

Thrift Savings Plan (TSP). FERS employees receive an automatic agency contribution equal to 

one percent of pay and the FMCS matches any employee contribution up to an additional four 

percent of pay. For FERS participants, the FMCS also contributes the employer’s matching share 

of Social Security.

FERS employees and certain CSRS reinstatement employees are eligible to participate in the 

Social Security program after retirement. In these instances, the FMCS remits the employer’s 

share of the required contribution.

The FMCS recognizes the imputed cost of pension and other retirement benefits during the 

employees’ active years of service. OPM actuaries determine pension cost factors by calculating 

the value of pension benefits expected to be paid in the future and communicate these factors to 

the FMCS for current period expense reporting. OPM also provides information regarding the 

full cost of health and life insurance benefits. The FMCS recognized the offsetting revenue as 

imputed financing sources to the extent these expenses will be paid by OPM.

The FMCS does not report on its financial statement information pertaining to the retirement 

plans covering its employees. Reporting amounts such as plan assets, accumulated plan benefits, 

and related unfunded liabilities, if any, is the responsibility of the OPM, as the administrator.

K. Other Post-Employment Benefits

The FMCS employees eligible to participate in the Federal Employees' Health Benefits Plan 

(FEHBP) and the Federal Employees' Group Life Insurance Program (FEGLIP) may continue to 

participate in these programs after their retirement. The OPM has provided the FMCS with 

certain cost factors that estimate the true cost of providing the post-retirement benefit to current 

employees. The FMCS recognizes a current cost for these and Other Retirement Benefits (ORB) 

at the time the employee's services are rendered. The ORB expense is financed by OPM and 

offset by the FMCS through the recognition of an imputed financing source.

L. Use of Estimates

The preparation of the accompanying financial statements in accordance with generally accepted 

accounting principles requires management to make certain estimates and assumptions that affect 

the reported amounts of assets, liabilities, revenues, and expenses. Actual results could differ 

from those estimates.

M. Classified Activities

Accounting standards require all reporting entities to disclose that accounting standards allow 

certain presentations and disclosures to be modified, if needed, to prevent the disclosure of 

classified information.
39

NOTE 2. FUND BALANCE WITH TREASURY

Fund Balance with Treasury account balances as of September 30, 2020 and 2019, were as 

follows:

2020 2019

Status of Fund Balance with Treasury:

Unobligated Balance

Available $ 1,201,633 $ 2,330,346

Unavailable 6,368,217 4,689,569

Obligated Balance Not Yet Disbursed 5,120,995 5,157,156

Non-Budgetary FBWT - -

Total $ 12,690,845 $ 12,177,071

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

in the Treasury accounts.

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 

fund balance on hand (see also Note 12).

NOTE 3. ACCOUNTS RECEIVABLE, NET

Accounts receivable balances as of September 30, 2020 and 2019, were as follows:

2020 2019

Intragovernmental

Accounts Receivable $ 206,724 $ 18,574

Total IntragovernmentalAccounts Receivable $ 206,724 $ 18,574

With the Public

Accounts Receivable $ 10,626 $ -

Total Public Accounts Receivable $ 10,626 $ -

Total Accounts Receivable $ 217,350 $ 18,574

The accounts receivable is primarily made up of amounts due from federal government 

departments and other agencies.
40

Historical experience has indicated that the majority of the receivables are collectible. There are 

no material uncollectible accounts as of September 30, 2020 and 2019.

NOTE 4. GENERAL PROPERTY, PLANT AND EQUIPMENT, NET

Schedule of General Property, Plant and Equipment, Net as of September 30, 2020:

Major Class

Acquisition 

Cost

Accumulate d 

Amortization/ 

Depreciation

Net Book 

Value

Furniture & Equipment $ 1,022,888 $ 841,700 $ 181,188

Construction-in-Progress 145,244 N/A 145,244

Total $ 1,168,132 $ 841,700 $ 326,432

Schedule of General Property, Plant and Equipment, Net as of September 30, 2019:

Accumulate d

Acquisition Amortization/ Net Book

Major Class Cost Depreciation Value

Furniture & Equipment $ 1,074,887 $ 765,675 $ 309,212

Total $ 1,074,887 $ 765,675 $ 309,212

NOTE 5. LIABILITIES NOT COVERED BY BUDGETARY RESOURCES

The liabilities for the FMCS as of September 30, 2020 and 2019, 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.

2020 2019

Intragovernmental – FECA $ 246,417 $ 336,135

Unfunded Leave 3,057,139 2,513,606

Actuarial FECA 1,654,305 1,752,946

Total Liabilities Not Covered by Budgetary Resources $ 4,957,861 $ 4,602,687

Total Liabilities Covered by Budgetary Resources 2,244,839 1,650,708

Total Liabilities $ 7,202,700 $ 6,253,395

FECA and the Unemployment Insurance liabilities represent the unfunded liability for actual 

workers compensation claims and unemployment benefits paid on the FMCS’s behalf and 

payable to the DOL. The FMCS also records an actuarial liability for future workers 

compensation claims based on the liability to benefits paid (LBP) ratio provided by DOL and 

multiplied by the average of benefits paid over three years.

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

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

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

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

budgetary resources. Sick and other leave is expensed astaken.
41

NOTE 6. OTHER LIABILITIES

Other liabilities account balances as of September 30, 2020 were as follows:

Current NonCurrent Total

Intragovernmental

FECA Liability $ 246,417 $ - $ 246,417

Payroll Taxes Payable 417,691 - 417,691

Total Intragovernmental Other Liabilities $ 664,108 $ - $ 664,108

With the Public

Payroll Taxes Payable $ 63,231 $ - $ 63,231

Accrued Funded Payroll and Leave 1,554,382 - 1,554,382

Unfunded Leave - 3,057,139 3,057,139

Other Liabilities 5,197 - 5,197

Total Public Other Liabilities $ 1,622,810 $ 3,057,139 $ 4,679,949

Other liabilities account balances as of September 30, 2019 were as follows:

Current NonCurrent Total

Intragovernmental

FECA Liability $ 336,135 $ - $ 336,135

Payroll Taxes Payable 297,611 - 297,611

Total Intragovernmental Other Liabilities $ 633,746 $ - $ 633,746

With the Public

Payroll Taxes Payable $ 18,576 $ - $ 18,576

Accrued Funded Payroll and Leave 1,161,296 - 1,161,296

Unfunded Leave - 2,513,606 2,513,606

Total Public Other Liabilities $ 1,179,872 $ 2,513,606 $ 3,693,478

NOTE 7. LEASES

The FMCS leases office space for headquarters operations in Washington, D.C. and for district 

and field operations. The lease agreements expire at various dates, the latest being 2034. Assets 

held under these leases consist primarily of offices. All office space occupied by the FMCS is 

leased by the General Services Administration.

Future estimated minimum lease payments for the fiscal years ended September 30 are as 

follows:
42

Fiscal Year Office Space

2021 $ 4,180,787

2022 4,216,213

2023 4,011,908

2024 4,029,346

2025 3,949,393

2026 thru 2034 19,594,805

Total Future Payments $ 39,982,452

Due to three (3) office closures in FY2020 (Louisville, New Orleans, and Atlanta) this affected 

forecasting numbers starting in FY2021.

NOTE 8. COMMITMENTS AND CONTINGENCIES

The FMCS did not have any material contingent liabilities that met disclosure requirements as of 

September 30, 2020 and 2019.

NOTE 9. INTER-ENTITY COSTS

The FMCS recognizes certain inter-entity costs for goods and services that are received from 

other federal entities at no cost or at a cost less than the full cost. Certain costs of the providing 

entity that are not fully reimbursed are recognized as imputed cost and are offset by imputed 

revenue. Such imputed costs and revenues relate to employee benefits and claims to be settled by 

the Treasury Judgement Fund. The FMCS recognizes as inter-entity costs the amount of accrued 

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

associated with such benefits are the responsibility of the administering agency, OPM. For the 

periods ended September 30, 2020 and 2019, respectively, inter-entity costs were asfollows:

2020 2019

Office ofPersonnelManagement $ 1,556,943 $ 2,086,153

Total ImputedFinancing Sources $ 1,556,943 $ 2,086,153

NOTE 10. NET ADJUSTMENTS TO UNOBLIGATED BALANCE, BROUGHT 

FORWARD, OCTOBER 1

The Unobligated Balance Brought Forward from the prior fiscal year has been adjusted for 

recoveries of prior year paid and unpaid obligations and other changes such as canceled authority. 

The Adjustments to Unobligated Balance Brought Forward, October 1, as of September 30, 2020, 

and 2019, consisted of the following:
43

2020 2019

Unobligated Balance Brought Forward From Prior Year, October 1 $ 7,019,915 $ 6,117,877

Recoveries of Prior Year Obligations 86,825 813,043

Other Changes in Unobligated Balances (150,896) (709,985)

Unobligated Balance From Prior Year Budget Authority, Net (Discretionary and Mandatory) $ 6,955,844 $ 6,220,935

NOTE 11. APPORTIONMENT CATEGORIES OF NEW OBLIGATIONS AND 

UPWARD ADJUSTMENTS

New obligations and upward adjustments incurred and reported in the Statement of Budgetary 

Resources in 2020 and 2019 consisted of the following:

2020 2019

Direct Obligations, Category A $ 47,595,948 $ 47,061,000

Reimbursable Obligations, Category A 1,619,801 1,132,226

Total New Obligations and Upward Adjustments $ 49,215,749 $ 48,193,226

Category A apportionments distribute budgetary resources by fiscal quarters.

NOTE 12. UNDELIVERED ORDERS AT THE END OF THEPERIOD

As of September 30, 2020, budgetary resources obligated for undelivered orders were as follows:

Federal Non-Federal Total

Unpaid Undelivered Orders $ 146,279 $ 3,367,197 $ 3,513,476

Total Undelivered Orders $ 146,279 $ 3,367,197 $ 3,513,476

As of September 30, 2019, budgetary resources obligated for undelivered orders were as follows:

Federal Non-Federal Total

Unpaid Undelivered Orders $ 176,940 $ 3,312,951 $ 3,489,891

Total Undelivered Orders $ 176,940 $ 3,312,951 $ 3,489,891

NOTE 13. EXPLANATION OF DIFFERENCES BETWEEN THE SBR AND THE 

BUDGET OF THE U.S. GOVERNMENT

The President’s Budget that will include fiscal year 2020 actual budgetary execution information 

has not yet been published. The President’s Budget is scheduled for publication in February 2021 

and can be found at the OMB Web site: http://www.whitehouse.gov/omb/. The 2021 Budget of 

the United States Government, with the "Actual" column completed for 2019, has been 

reconciled to the Statement of Budgetary Resources and there were no material differences.
44

Budget of the U.S. Government $ 52 $ 48 $ - $ 48

In Millions

Combined Statement of Budgetary

Resources $ 55 $ 48 $ - $ 48

Unobligated Balance Not Available (3) - - -

NOTE 14. RECONCILIATION OF NET COST TO NET OUTLAYS

The reconciliation of net outlays, presented on a budgetary basis, and the net cost, presented on 

an accrual basis, provides an explanation of the relationship between budgetary and financial 

accounting information.

Reconciliation of Net Cost to Net Outlays as of September 30, 2020:

Net

Outlays

New Obligations Distributed 

Budgetary & Upward Offsetting

Resources Adjustments Receipts
45

RECONCILIATION OF NET COST TO NET OUTLAYS 

FOR THEYEAR ENDED SEPTEMBER 30, 2020

(In Dollars)

Intragovernmental With the Public Total

Net Operating Cost (SNC) $ 13,930,222 $ 34,895,360 $ 48,825,582

Components of Net Operating Cost Not Part of the Budgetary

Outlays

Property, plant, and equipment depreciation - (125,904) (125,904)

Other - Conversion related fixed asset reclassification - 16,406 16,406

Increase/(Decrease) in assets not affecting Budget Outlays:

Accounts receivable 188,150 10,626 198,776

(Increase)/Decrease in liabilities not affecting Budget Outlays:

Accounts payable - (35,761) (35,761)

Salaries and benefits (120,080) (437,740) (557,820)

Other liabilities 89,718 (445,442) (355,724)

Other financing sources:

Imputed federal employee retirement benefit costs (1,556,943) - (1,556,943)

Total Components of Net Operating Cost Not Part of the Budget

Outlays $ (1,399,155) $ (1,017,815) $ (2,416,970)

Components of the Budget Outlays That Are Not Part of Net 

Operating Cost

Acquisition ofcapital assets - 126,718 126,718

Total Components of the Budget Outlays That Are Not Part of Net 

Operating Cost $ - $ 126,718 $ 126,718

Net Outlays (Calculated Total) $ 12,531,067 $ 34,004,263 $ 46,535,330

Related Amounts on the Statement of Budgetary Resources

Outlays, net, (total) (SBR 4190) 46,535,330

Agency Outlays, Net (SBR 4210) $ 46,535,330

Reconciliation of Net Cost to Net Outlays as of September 30, 2019:
46

RECONCILIATION OF NET COST TO NET OUTLAYS 

FOR THEYEAR ENDED SEPTEMBER 30, 2019

(In Dollars)

Intragovernmental With the Public Total

Net Operating Cost (SNC)

Components of Net Operating Cost Not Part of the Budgetary 

Outlays

$ 13,476,985 $ 36,296,342 $ 49,773,327

Property, plant, and equipment depreciation - (261,198) (261,198)

Property, plant, and equipment disposal & reevaluation - (24,723) (24,723)

Increase/(Decrease) in assets not affecting Budget Outlays:

Accounts receivable (9,207) - (9,207)

(Increase)/Decrease in liabilities not affecting Budget Outlays:

Accounts payable - 811,792 811,792

Salaries and benefits (42,303) (135,655) (177,958) 

Insurance and guarantee program liabilities - - -

Environmental and disposal liabilities - - -

Other liabilities (5,185) (238,228) (243,413)

Other financing sources:

Imputed federal employee retirement benefit costs (2,086,153) - (2,086,153)

Total Components of Net Operating Cost Not Part of the Budget

Outlays $ (2,142,848) $ 151,988 $ (1,990,860)

Components of the Budget Outlays That Are Not Part of Net 

Operating Cost

Acquisition of capital assets - 101,303 101,303

Total Components of the Budget Outlays That Are Not Part of Net

Operating Cost $ - $ 101,303 $ 101,303

Net Outlays (Calculated Total) $ 11,334,137 $ 36,549,633 $ 47,883,770

Related Amounts on the Statement of Budgetary Resources

Outlays, net, (total) (SBR 4190) 47,883,770

Agency Outlays, Net (SBR 4210) $ 47,883,770