NOTE 17 Imputed Financing


Consistent with SFFAS No.4, AOC incorporates the full cost of goods and services received from other federal entities in its Statement of Net Cost. Certain costs of the providing entity may not be not fully reimbursed by AOC. The unreimbursed portion of these costs is recognized as imputed costs and are included in the operating amounts reported on the Statement of Net Cost. The imputed costs are offset by imputed financing sources and are reported on the face of the Statement of Changes in Net Position.


Such imputed costs and financing sources include campus-wide capital infrastructure projects performed by another federal agency and Treasury Judgment Fund or Office of Congressional Workplace Rights (OCWR) Settlement and Award Fund payments, as applicable.


The AOC has activities with OPM that also require imputed costs and financing sources to be recognized. The OPM administers three earned benefit program for civilian Federal employees: the Federal Employees Health Benefits (FEHB) Program, the Federal Employee Group Life Insurance (FEGLI) Program, and the Retirement Program, which includes CSRS, CSRS Offset and FERS. The imputed costs and financing sources consist of the benefits for AOC employees that are paid on its behalf by OPM.


CSRS: According to PL 99-335, all employees hired prior to January 1, 1987, could elect CSRS or CSRS Offset. The CSRS provides a basic annuity and Medicare coverage. The CSRS fund covers most employees hired prior to January 1, 1984. The AOC and the employee contribute to Medicare at the rate prescribed by law. The AOC does not match TSP contributions for employees who participate in the CSRS retirement program.


CSRS Offset: CSRS Offset generally covers those employees who have had a break in their CSRS service of more than one and less than five years by the end of 1986. The AOC and the employee contribute to Social Security and Medicare at the rates prescribed by law. The AOC does not match TSP contributions for employees who participate in the CSRS Offset retirement program.


FERS: According to PL 99-335, employees with less than five years of creditable civilian service, as of the effective date in 1986, were automatically converted to FERS. In addition, during certain periods in 1987, 1988 and 1998, employees hired before January 1, 1984, could choose to participate in FERS. This system consists of Social Security, a basic annuity plan and the TSP.


The AOC and the employee contribute to Social Security and Medicare at rates prescribed by law. In addition, AOC is required to contribute to the TSP a minimum of 1 percent per year of the basic pay of employees covered by this system. The AOC also matches a voluntary employee contribution up to 3 percent


2019 PERFORMANCE AND ACCOUNTABILIT Y REPORT Financial Information • Section III 117


dollar-for-dollar, and another 2 percent is matched 50 cents on the dollar.


Imputed Financing for the years ending September 30, 2019, and 2018, is as follows:


Dollars in Thousands IMPUTED FINANCING, BY TYPE


Pensions CSRS


CSRS Offset FERS


Less: Contributions


Health Insurance Life Insurance


$ 2019 863 43,851 2018 $ 1,198


638 741 40,110


(35,336) Subtotal: Employee Pensions $ 10,016


$ 14,085 38


Subtotal: All Employee Benefits $ 24,139


Other Agency — Campus Infrastructure $ 2,124 OCWR — Settlement and Awards Fund Total


(33,642) $ 8,407


$ 13,759 36


$ 22,202 $ 4,511 $ $26,642


379 94 $ 26,807


In FY 2019, the imputed financing costs for employee benefits are $1.9 million higher mainly due to an increase in OPM’s cost factors for health insurance and for all three pensions categories, which resulted in a higher AOC service cost. Additionally, there was a $300 thousand increase in legal settlements that were paid out of the Office of Congressional Workplace Rights (OCWR) Settlement and Awards Fund. The reduction in the Campus Infrastructure costs is consistent with the other agency’s progress reports as the project winds down.


NOTE 18 Net Cost of Operations Related to Payroll


Expenses for salaries and related benefits for the years ending September 30, 2019, and 2018, are shown in the table below. These amounts were approximately 46 and 47 percent of the annual gross cost of operations for each respective year. This includes actual payroll and benefit expenses as well as other accrued expenses. Benefit expenses represent FECA (current portion), Unemployment Compensation for Federal Employees (UCFE), and imputed costs paid by OPM. Other accrued expenses consist of payroll and benefit related accruals. These costs do not include the unfunded accrued annual leave and long term actuarial FECA.


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