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Diplomacy in Action

Net Cost of Operations Summary


Bureau of Resource Management
Report
February 24, 2012

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The charts show each agency's net cost-gross costs less earned revenue, invested in each joint Strategic Goal. These goals, or objectives, are consistent with the State-USAID Strategic Planning Framework. Executive Direction and Operating Unit Management are costs that cannot be directly traced or reasonably allocated to strategic goals; however, these costs are captured and included in the total net cost of operations.

Department of State: Total net cost of $23.3 billion is an increase of 8 percent or $1.7 billion over 2010. The goals of Achieving Peace and Security, Investing in People, and Strengthening Consular and Management Capabilities account for most of this change. As seen in the Net Cost by Strategic Goal chart, the goal of Achieving Peace and Security is the largest. This goal included an International Narcotics and Law Enforcement (INL) cost increase by $525 million. The increase includes contractual expenses, educational grants and personnel costs. Our second largest goal, Investing in People, accounted for a $1.8 billion net cost increase. This was primarily the result of initiatives with the fund established in 2008 for Global Health and Child Survival. Additionally, passport and visa issuance included in the goal of Strengthening Consular and Management Capabilities contributed to $457 million of the increase in earned revenue.

USAID: The Statement of Net Cost shows the amounts spent on meeting the Agency's six objectives. These objectives are consistent with the State-USAID Strategic Planning Framework. The Investing in People and Economic Growth objectives represent the largest investments at 27 percent and 29 percent of total net costs, respectively. USAID's net costs increased 8 percent over last year due to the expenditure of funds appropriated in prior years primarily as a result of additional expenditures related to the Economic Growth objective. Complete details are provided in the AFR on page 27. The table below presents the net cost of operations by strategic goal.

NET COST OF OPERATIONS
For the Year Ended September 30, 2011
($ in millions)
Strategic Goal STATE USAID
Net Cost Percent
of Total
Net Cost
Net Cost Percent
of Total
Net Cost
Achieving Peace and Security $6,490 28% $937 8%
Governing Justly and Democratically 887 4% 1,835 16%
Investing in People 6,340 27% 3,063 27%
Promoting Economic Growth and Prosperity 1,450 6% 3,249 29%
Providing Humanitarian Assistance 1,967 8% 1,632 15%
Promoting International Understanding 2,562 11% N/A N/A
Strengthening Consular and Management Capabilities 865 4% N/A N/A
Other Cost Category
Operating Unit Management N/A N/A 528 5%
Executive Direction and Other Costs Not Assigned 2,255 10% N/A N/A
Actuarial Loss on Pension Assumption Changes 444 2% N/A N/A
Total Net Cost of Operations $23,260 100% $11,244 100%
Pie chart summarizing Net Cost of Operations for the Department of State. Values are ($ in millions): Strategic Goal 1: $6,490. Strategic Goal 2: $887. Strategic Goal 3: $6,340. Strategic Goal 4: $1,450. Strategic Goal 5: $1,967. Strategic Goal 6: $2,562. Strategic Goal 7: $865. Other Cost Category values are: Executive Direction and Other Costs Not Assigned: $2,255. Actuarial Loss on Pension Assumption Changes: $444. Total Net Cost of Operations: $23,260. Pie chart summarizing Net Cost of Operations for USAID. Values are ($ in millions): Strategic Goal 1: $937. Strategic Goal 2: $1,835. Strategic Goal 3: $3,063. Strategic Goal 4: $3,249. Strategic Goal 5: $1,632. Other Cost Category values are: Operating Unit Management: $528. Total Net Cost of Operations: $11,244.

 




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