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Diplomacy in Action

Financial Highlights


Bureau of Resource Management
Report
May 10, 2010

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Transparent reporting about U.S. stewardship and management of public funds is an integral part of the Department of State and USAID’s collaborative efforts to improve accountability to U.S. customers, constituents and the public. The following summarizes the Agency Financial Reports (AFRs) for both the Department of State and USAID for FY 2009. The AFRs present each agency’s audited financial statements and footnotes, along with performance and other required information.

The following pages include financial information on each agency’s assets, liabilities, and net position in a Balance Sheet Summary, information on each agency’s cost of operations in a Net Cost Summary, and available resources in a Budgetary Resources Summary. In addition, summary financial information from each agency’s FY 2009 principal financial statements is included. Both agencies’ AFRs are posted online.

For the complete Department of State AFR, see the Agency Financial Report for Fiscal Year 2009.

For the USAID AFR, see the Fiscal Year 2009 Agency Financial Report.

Department of State. During FY 2009, the Department engaged a new audit firm to conduct the annual audit. The new Independent Auditor (IA) issued an unqualified opinion on the Consolidated Statement of Net Cost and qualified opinions on the Consolidated Balance Sheet and Consolidated Statement of Changes in Net Position. The qualified opinions were based on the IA’s inability to satisfy themselves that property and equipment was free of material misstatement as of September 30, 2009. The new IA was not able to satisfy themselves as to whether the FY 2009 Combined Statement of Budgetary Resources was free of material misstatement in time to meet the deadline imposed by OMB. Therefore, the IA issued a disclaimer of opinion on the Statement of Budgetary Resources for the year ended September 30, 2009.

The FY 2009 audit resulted in a restatement of the FY 2008 Balance Sheet and Statement of Changes in Net Position to remove a $381 million environmental liability established prior to FY 2008 by the International Boundary and Water Commission in response to a court order. It was determined that the amount should be reflected solely in the footnotes versus on the principal financial statements. Additionally, an adjustment for land valuation established in FY 1996 reduced property and equipment by $399 million. The original FY 2008 financial statements and the restated amounts received an unqualified opinion. The new IA identified three material weaknesses and three significant deficiencies. The material weaknesses relate to the need for the IBWC liability restatement, accounting for property and equipment and timely financial reporting. The Department has actions underway to resolve these weaknesses.

USAID. The agency received an unqualified opinion for the seventh consecutive year from OIG. This affirms that USAID’s financial statements for the year ended September 30, 2009, were presented fairly in all material aspects and prepared in conformance with Generally Accepted Accounting Principles (GAAP). The Independent Auditor’s Report can be found at the Audit of USAID Financial Statements for Fiscal Years 2009 and 2008. The auditor identified one material weakness related to unreconciled differences between the Agency’s Fund Balance and its cash balance reported by the U.S. Treasury, and three significant deficiencies. Corrective action plans are in place to resolve these findings and related audit recommendations by September 30, 2010.

The following summarized financial statement information is based on the same underlying data presented in the FY 2009 Agency Financial Report (AFR). This condensed information provides a high level analysis of each agency’s financial performance and should not be viewed as a substitute for the financial statements and notes contained in the AFR.

 




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