The Department implements financial statement reporting requirements and new Statement of Federal Financial Accounting Standards (SFFAS) when they become effective. No new SFFASs were implemented during FY 2004 and FY 2003.
On September 25, 2001, OMB issued Bulletin 01-09 (Bulletin), Form and Content of Agency Financial Statements. This Bulletin provides guidance for preparing agency financial statements and supersedes OMB Bulletin No. 97-01, Form and Content of Agency Financial Statements, as amended. It contains significant changes. The requirements contained in the Bulletin are phased in beginning with FY 2001, are effective in their entirety for the preparation of financial statements for fiscal years beginning after September 30, 2001 (i.e., FY 2002 and beyond), and significantly affect how the Department reports on its programs.
The major changes required by the Bulletin are as follows.
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Integrated Reporting. Combined performance and accountability reports that present both performance and financial reports are required for FY 2002 and beyond.
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Accelerated Reporting. For FY 2003 and FY 2002, performance and accountability reports are due to OMB and the Congress by February 1. For FY 2004 and beyond, OMB accelerated the due date for submitting performance and accountability reports to November 15—that is, 45 days after the end of the fiscal year.
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Budget Integration. The Statement of Budgetary Resources is revised to improve the linkage between this statement and the Budget of the United States Government.
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Financial Statement Formats. Significant changes in labeling and formatting of line items on the Statement of Changes in Net Position, Statement of Budgetary Resources, and Statement of Financing are effective to facilitate an understanding of the flow of information between statements. Labeling and formatting of line items on the Balance Sheet are streamlined to improve usefulness to readers of the financial statements.
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Comparative Reporting. The preparation of comparative financial statements is required for FYs 2003 and beyond. FY 2003 is the first year for which comparative Statements of Changes in Net Position, Budgetary Resources, and Financing (and related footnotes) are presented. Also, information presented in the Financial Highlights Section of the Management Discussion and Analysis, Required Supplementary Stewardship Information and Required Supplementary Information are presented on a comparative basis when the information is meaningful to the user of the financial report.
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Interim Financial Reporting. Beginning in FY 2003, unaudited financial statements are required to be prepared and submitted to OMB on a quarterly basis (i.e., December 31, March 31, and June 30) no later than 45 days after the end of the reporting period. Beginning with the second quarter of FY 2004, the due date for quarterly statements accelerates to no later than 21 days after the end of each quarter. Since inception, the Department has met the interim financial reporting requirement on a timely basis.
The Statement of Net Cost for FY 2004 and 2003 reflects the changes made in FY 2003 to present net cost by strategic goals which is consistent with OMB Bulletin 01-09, and explained more fully in Note 17 to the financial statements.
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