Notes to Financial Statements
Notes to OPM 2024 Agency Financial Report
September 30, 2024 and 2023 ($ in millions)
Note 1, Reporting Entity and Summary of Significant Accounting Policies
A. Reporting Entity
OPM is the Federal Government’s HR agency. It was created as an independent agency of the Executive Branch of Government on January 1, 1979. Many of the functions of the former Civil Service Commission were transferred to OPM at that time.
The accompanying financial statements present OPM’s financial position, net cost of operations, changes in net position, and status of budgetary resources, as required by the CFO Act, GMRA, and the FY 2024 OMB Circular A-136, Financial Reporting Requirements. The financial statements include all accounts — appropriation, trust, trust revolving, special and revolving funds — under OPM’s control. OPM is a component of the U.S. Government. For this reason, activity between OPM and other intragovernmental agencies may be eliminated for Government-wide reporting.
The financial statements comprise the following major programs administered by OPM: The funds related to the operation of the Retirement Program, the Health Benefits Program, and the Life Insurance Program. The statutory authority for OPM’s Federal employees’ benefit programs can be found in Title 5, USC; Chapters 83 and 84 provide a complete description of the CSRDF’s provisions; Chapter 89 provides a complete description of the Employees’ Health Benefits Fund and the Retired Employees’ Health Benefits Fund provisions; and Chapter 87 provides a complete description of the Employees’ Group Life Insurance Fund provisions. Sections 802 and 803 of Public Law (P.L.) 109- 435, the Postal Accountability and Enhancement Act (Postal Act), amended certain provisions of Chapters 83 and 89 of Title 5 dealing with the Retirement Program and the Health Benefits Program, respectively. In January 2025, Title I, Section 101 of The PSRA of 2022 (P. L. 117-108) requires OPM to establish the PSHBP, a separate health benefit program for USPS employees, annuitants, and their eligible family members that will operate in parallel to the FEHBP. In addition, the financial statements also encompass OPM’s Other Programs, which includes the Revolving Fund Programs as well as S&E.
Retirement Program
The Retirement Program consists of two defined-benefit pension plans: the CSRS and the FERS. Together, the two plans cover substantially all full-time, permanent civilian Federal employees. The CSRS, implemented in 1921, is a stand-alone plan, providing benefits to most Federal employees hired before 1984. The FERS uses Social Security as its base and provides an additional defined benefit and a voluntary thrift savings plan to most employees entering the Federal service after 1983. The FERS was established in 1986 and when it became effective on January 1, 1987, CSRS Interim employees with less than 5 years of creditable civilian service on December 31, 1986, were automatically converted to FERS. The FERS – Revised Annuity Employees (RAE) was established in 2012 and became effective on January 1, 2013, and the FERS – Further Revised Annuity Employee (FRAE) was established in 2013 and became effective on January 1, 2014. Both defined-benefit pension plans are operated via the CSRDF, a trust fund. Asset balances for CSRS and FERS are separately tracked within the CSRDF, and balances allocated to FERS may be transferred to CSRS to pay benefits for the CSRS participants. Title 5, USC, Chapters 83 and 84, provide a complete description of the CSRDF’s provisions. OPM does not administer the voluntary Thrift Savings Plan.
Health Benefits Program
The Health Benefits Program provides comprehensive health insurance benefits to Federal employees, annuitants, their eligible family members, and other eligible persons. It was implemented in 1960 and is operated through two trust revolving funds: the Employees’ Health Benefits Fund and the Retired Employees’ Health Benefits Fund. Title 5, USC, Chapter 89 provides a complete description of the funds’ provisions. To provide benefits, OPM contracts with more than 67 FEHB carriers. Most contracts with carriers that provide fee-for-service benefits are experience-rated, with the amount contributed by and for participants affected by, among other things, the number and size of claims. Most Health Maintenance Organizations (HMO) contracts are community-rated, so the amount of profit and administrative expenses charged to the FEHBP by the carrier can be no more than what is allowed in the large group market overall.
On December 20, 2006, President Bush signed into law the Postal Act, P.L. 109-435. Title VIII of the Postal Act made significant changes in the laws dealing with the funding of CSRS benefits and the funding of retiree health benefits for employees of the USPS. The Postal Act required the USPS to make statutorily defined payments to the PSRHBF through 2016 and actuarially determined prefunding payments beginning in 2017. The PSRA of 2022 repealed the required prefunding payments, eliminated all past due payments, and defined a new formula for payments into the PSRHBF beginning in 2026. The new payments are not meant to prefund PRHB; they have the net effect of the USPS drawing claims costs instead of premiums for their annuitants from the fund. The PSRHBF is included in the Health Benefits Program.
Life Insurance Program
The FEGLI Program provides group, term-life insurance coverage to Federal employees and retirees. The Life Insurance Program was implemented in 1954 and significantly modified in 1980. It is operated through the FEGLI Fund, a trust revolving fund, and is administered, virtually in its entirety, by the Metropolitan Life Insurance Company under contract with OPM. Title 5, USC, Chapter 87 provides a complete description of the fund’s provisions. It provides Basic life insurance (which includes accidental death and dismemberment coverage) and three packages of optional coverage.
Other Programs
OPM provides various HR-related services in a Revolving Fund Program to other Federal agencies, such as credit monitoring, employee training, and other human resource solutions. These activities are financed through an intragovernmental revolving fund.
In addition, OPM’s S&E Program provides the budgetary resources OPM uses for administrative purposes in support of the agency’s mission. These resources are furnished by annual, multiple-year, and no-year appropriations. Annual appropriations are made for a specified fiscal year and are available for new obligations only during that fiscal year. Multiple-year appropriations are available for a definite period in excess of one fiscal year. No-year appropriations are available for obligation without fiscal year limitation.
B. Basis of Accounting and Presentation
Basis of Accounting
OPM’s financial statements reflect both accrual and budgetary accounting transactions. Under the accrual method of accounting, exchange revenue is recognized when earned and expenses are recognized when incurred, without regard to the receipt or payment of cash.
Basis of Presentation
The OPM fiscal year ends September 30. The accompanying financial statements account for all resources for which OPM is responsible. The financial statements are prepared from the books and records of OPM activities in accordance with GAAP promulgated by the Federal Accounting Standards Advisory Board (FASAB1) and presented in the format prescribed by the FY 2024 OMB Circular A-136.
OPM has prepared comparative financial statements for the Balance Sheets, Statement of Net Cost, Statements of Changes in Net Position, and the Statements of Budgetary Resources.
OPM’s Balance Sheets: To show the assets, liabilities, and net position to present a comprehensive understanding of OPM’s financial position.
OPM’s Statements of Net Costs: To derive its net cost of operations, OPM deducts the earned revenues associated with its gross cost of providing benefits and services on the accompanying Statements of Net Cost.
OPM’s Statements of Changes in Net Position: The Statements of Changes in Net Position separately discloses other financing sources including appropriations, net cost of operations, and cumulative results of operations.
OPM’s Statements of Budgetary Resources: The budgetary accounting concepts are recognized in the Statements of Budgetary Resources. OPM’s Statements of Budgetary Resources present:
- Budgetary resources2 for the fiscal year. OPM’s budgetary resources include unobligated balances of resources from prior years and new resources, consisting of appropriations, and spending authority from offsetting collections.
- Status of those budgetary resources which include obligated3 amounts and unobligated4 amounts for the fiscal year. OPM’s obligations are direct and reimbursable. In general, reimbursable obligations are those financed by offsetting collections (see Section 20.7 (d)) received in return for goods and services provided, while all other obligations are direct, with a few exceptions noted in OMB Circular A-11.
- Outlays5, Net, and Distributing Offsetting Receipts (cash transactions) for the fiscal year, which is comprised of Outlays less Actual Offsetting Receipts (cash transactions) and includes:
- Outlays, Net, which is comprised of Disbursements less, Offsetting Collections6.
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Agency Outlays, Net, which is comprised of Outlays, Net less Distributed Offsetting Receipts. Distributed Offsetting Receipts represents actual collections from With the Public or from other Federal entities, net of disbursements, that are credited to certain receipt accounts (general fund, special fund, trust fund, and gift and donation receipt accounts) and budget clearing accounts, and for which the net receipts recorded to this line offset the budget outlays of the agency that conducts the activity generating the receipts.
Budgetary accounting is based on concepts set forth by OMB Circular A-11, Preparation, Submission, and Execution of the Budget, as amended, which provides instructions on budget execution. Budgetary accounting is designed to recognize the budgetary resources and the related status of those budgetary resources, including the obligation and outlay of funds according to legal requirements, which in many cases is made prior to the occurrence of an accrual-based transaction. Budgetary accounting is essential for compliance with legal constraints and controls over the use of Federal funds.
Financial Statement Classifications
Intragovernmental and With the Public: Statement of Federal Financial Accounting Standards (SFFAS) 1 distinguishes between intragovernmental and Non-federal (referred to as With the Public) assets and liabilities. Intragovernmental assets and liabilities arise from transactions among Federal entities. Intragovernmental assets are claims other Federal entities owe to OPM. Intragovernmental liabilities are claims OPM owes to other Federal entities, whereas With the Public assets and liabilities arise from transactions with Non-federal entities. The term, With the Public entities, encompass domestic and foreign persons and organizations outside the U.S. Government. With the Public assets are claims of OPM against public entities. With the Public liabilities are amounts that OPM owes to With the Public entities.
Throughout these financial statements, intragovernmental assets, liabilities, revenue and cost have been classified according to the type of entity with which the transactions are associated. The majority of OPM's gross cost to provide Retirement, Health Benefits and Life Insurance Program benefits are classified as costs With the Public because the recipients of these benefits are Federal employees, retirees, and their survivors and families.
Footnote 1
FASAB is the official body for setting accounting standards of the U.S. Government.
Footnote 2
Per OMB Circular A-11, Section 20, “Budgetary resources are amounts available to incur obligations in a given year. Budgetary resources consist of new budget authority and unobligated balances of budget authority provided in previous years.”
Footnote 3
Per OMB Circular A-11, Section 20, “Obligation means a legally binding agreement that will result in outlays, immediately or in the future.”
Footnote 4
Per OMB Circular A-11, Section 20, “Unobligated amount means the cumulative amount of budget authority that remains available for obligation under law in unexpired accounts. The term “expired balances available for adjustment” only refers to unobligated amounts in expired accounts.”
Footnote 5
Per OMB Circular A-11, Section 20, “Outlay means a payment to liquidate an obligation (other than the repayment to the Treasury of debt principal). Outlays are a measure of Government spending.”
Footnote 6
Per OMB Circular A-11, Section 20, Terms and Concepts, “Offsetting collections mean payments to the government that, by law, are credited directly to expenditure accounts and deducted from gross budget authority and outlays of the expenditure account, rather than added to receipts. Usually, offsetting collections are authorized to be spent for the purposes of the account without further action by Congress. They usually result from business-like transactions With the Public, including payments from With the Public in exchange for goods and services, reimbursements for damages, and gifts or donations of money to the government and from intragovernmental transactions with other government accounts. The authority to spend offsetting collections is a form of budget authority.”
C. Use of Management’s Estimates
The preparation of financial statements in accordance with GAAP requires management to make certain estimates. These estimates affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of earned revenues and costs during the reporting period. Actual results could differ from the estimates.
D. Entity vs. Non-Entity Assets
SFFAS 1, Accounting for Selected Assets and Liabilities, distinguishes between entity and non-entity assets. Entity assets are those the reporting entity has the legal authority to use in its operations. Non-entity Assets refers to assets received from the public. All OPM assets are entity assets.
E. Appropriations and Funding Sources
OPM receives new budgetary resources each fiscal year in the form of appropriations, trust fund receipts, and spending authority from offsetting collections. In addition, OPM normally carries-over a balance of unobligated budgetary resources from the prior fiscal year, which may be used in accordance with the current year SF-132 to cover spending, should new budgetary resources or collections be insufficient to cover obligations incurred.
Appropriations
By an act of Congress, OPM receives budgetary resources in the form of appropriations that allow it to incur obligations to pay (1) the Government’s share of the cost of health and life insurance benefits for Retirement Program annuitants; and (2) in part, the administrative and operating expenses of OPM. In addition, the General Fund of the U.S. Government transfers an amount annually to the OPM CSRDF to subsidize, in part, the underfunding of the CSRDF. OPM’s appropriations state the amount of the authority at the time it is granted, and the authority is available for obligation only during the current fiscal year. At fiscal year-end, any unobligated balances in the appropriations that fund the Government’s share of the cost of health and life insurance benefits are returned to the Treasury. Existing obligated balances can be used to make payments, but unobligated balances are not available for new obligations. Budgetary resources, including any related obligations and payables, are ‘cancelled’ at the end of the five-year expiration period. All cancelled funding is returned to Treasury.
Trust Fund Receipts
The amounts collected by OPM and credited to the CSRDF and PSRHBF generate budgetary resources in the form of trust fund receipts. Trust fund receipts are immediately appropriated and available to cover the valid obligations of the CSRDF and PSRHBF as they are incurred in accordance with the approved OMB SF-132.
At the end of each fiscal year, the amount by which OPM’s collections have exceeded its incurred obligations are temporarily precluded from obligation and added to OPM’s trust fund balance. For FY 2024 and FY 2023, the PSRHBF receipts are used to pay annual premium costs for the USPS post 1971 current annuitants [See Note 10]. The PSRHBF operates similarly to the CSRDF.
Spending Authority from Offsetting Collections
The amount collected by OPM and credited to the Health Benefits, Life Insurance and Revolving Fund Programs generates budgetary resources in the form of ‘spending authority from offsetting collections’ (SAOC). During the fiscal year, the obligations incurred by OPM for these programs may not exceed the amounts apportioned by OMB. At year-end, the remaining unobligated balances are brought forward into the subsequent fiscal year. Amounts collected by OPM and credited to the CSRDF [and the PSRHBF] generate budgetary resources in the form of trust fund receipts.
F. Program Funding
Retirement Program
Service-cost represents an estimate of the amount of contributions which, if accumulated and invested over the careers of participants, will be sufficient to fully fund their future CSRS or FERS benefits. OPM’s Office of the Actuaries has determined that the service-cost for most or “regular” CSRS participants is 59.3 percent and 56.5 percent of basic pay for FY 2024 and FY 2023, respectively. For FERS, the service cost for most or “regular” FERS participants is 26.2 percent and 24.7 percent of basic pay for FY 2024 and FY 2023, respectively, and for “regular” Federal Employees Retirement System-Further Revised Annuity Employees (FERS-FRAE) participants is 27.1 percent and 25.5 percent of basic pay for FY 2024 and FY 2023, respectively. Different service-costs apply for participants under Federal Employees Retirement System-Revised Annuity Employees (FERS-RAE), Postal Service participants, and participants covered under special retirement provisions such as law enforcement officers, firefighters, and air traffic controllers.
CSRS
Both CSRS participants and their employing agencies, except for USPS, are required by statute to make contributions to CSRS coverage. Regular CSRS participants and their employers each contributed 7.0 percent of pay in both FY 2024 and FY 2023. The combined 14.0 percent of pay does not cover the service cost of a CSRS benefit. To lessen the shortfall, Treasury is required by statute to transfer an amount annually from the General Fund of the U.S. Government to the CSRDF [See Note 1.G.]; for FY 2024 and FY 2023, this amount was $36.0 billion and $35.5 billion, respectively, for the CSRS.
FERS
Both FERS participants and their employing agencies are required by statute to make contributions for FERS coverage. In addition, Treasury is required by statute to transfer an amount from the General Fund of the U.S. Government to the CSRDF for the FERS Supplemental Liability; for FY 2024 and FY 2023, this amount was $17.3 billion and $14.4 billion, respectively. There are currently three FERS participant contribution rates for most regular participants:
- For most participants who entered before calendar year 2013, the FERS participant contribution rate is 0.8 percent of pay. The rate is equal to the CSRS participant contribution rate less the prevailing Old Age Survivor and Disability Insurance deduction rate.
- FERS-RAE, which was established under the Middle-Class Tax Relief and Job Creation Job Act of 2012, P.L. 112-96, Section 5001 – Federal Employees Retirement, generally applies for participants who entered during calendar year 2013. For most FERS-RAE participants, the participant contribution rate is 3.1 percent of pay.
- FERS-FRAE, which was established under Section 401 of the “Bipartisan Budget Act of 2013,” P.L. 113-67, Sec. 401, generally applies for participants entering on or after January 1, 2014. For most FERS-FRAE participants, the participant contribution rate is 4.4 percent of pay.
Note: There is no difference in the FERS basic benefit paid to FERS Regular, FERS-RAE, and FERS-FRAE employees. However, the basic benefit for congressional employees and members of Congress under FERS-RAE and FERS-FRAE is different than the basic benefit paid to those groups under FERS.
Health Benefits Program
The Health Benefits Program (except for the PSRHBF) is funded on a “pay-as-you-go” basis, with both participants and their employing agencies making contributions on approximately a 30 percent to 70 percent basis (some categories of enrollees are responsible for the entire premium amount (e.g., Temporary Continuation of Coverage, former spouses)). OPM contributes the “employer” share for Retirement Program annuitants via an appropriation. It continues to provide benefits to active employees, or their survivors, after they retire (post-retirement benefits). Except for the USPS, agencies are not required to make premium contributions for their annuitants.
Life Insurance Program
The Life Insurance Program is funded on a “pay-as-you-go” basis, with both participants and their employing agencies making contributions to Basic life insurance coverage, generally on a two-thirds to one-third basis; OPM contributes the “employer” share for Retirement Program annuitants via an appropriation. It is funded using the “level premium” method, where contributions paid by and for participants remain fixed until age 65 but overcharge during early years of coverage to compensate for higher rates of expected outflows in later years. A small portion, 0.02 percent of the pay of participating employees in FY 2024 and FY 2023, of post-retirement life insurance coverage is not funded and is an OPM liability.
Other Programs
OPM’s Revolving Fund Programs provide a continuing cycle of HR services primarily to Federal agencies on a reimbursable basis. Each program is operated at rates established by OPM to be adequate to recover costs over a reasonable period. Receipts derived from operations are, by law, available in their entirety for use of the fund without further action by Congress. Since the Revolving Fund’s programs charge full cost, customer-agencies do not recognize imputed costs. OPM provides receiving entities of such services with full cost information through billings based on reimbursable agreements for services rendered. Examples of OPM Revolving Fund programs include USAJOBS and Human Resource Solutions.
The S&E account and the Office of Inspector General (OIG) S&E account finance most of OPM’s operating expenses and have three funding sources: 1) S&E appropriation; 2) transfers from the trust fund accounts; and 3) reimbursements. Funds to administer these programs are transferred from the Trust Fund accounts to the respective administrative S&E account as costs are incurred and disbursed.
G. Financing Sources Other than Earned Revenue
OPM receives inflows of assets from financing sources other than earned revenue. These financing sources are not deducted from OPM’s gross cost of providing benefits and services on the Statements of Net Cost but added to its net position on the Statements of Changes in Net Position. OPM’s major financing sources other than earned revenue are:
Appropriations Used
By an act of Congress, OPM receives appropriated authority allowing it to incur obligations and make expenditures to cover the operating costs of the agency (S&E) and the Government’s share of the cost of health and life insurance benefits for Retirement Program annuitants. OPM recognizes appropriations as “used” at the time it incurs expended obligations against its appropriated authority.
Transfer-In/Out Without Reimbursement
Administrative transfers between OPM funds generally offset each other annually. Funds disbursed from the Other Programs S&E accounts for the administration of the Trust Fund Programs are reimbursed as costs are incurred.
The CSRS is funded by employee and agency contributions and remaining funds from the General Fund of the U.S. Government. The warrant received from the General Fund of the U.S. Government is recorded as a transfer-out of the Retirement Payment Account and a transfer-in to the Retirement Program. This activity offsets and therefore does not appear on the Retirement statement of changes in net position.
Other Financing Sources
Other Financing Sources include imputed financing. Goods and services are received from other Federal entities at no cost or at a cost less than the full cost to the providing Federal entity.
Consistent with accounting standards, certain costs of the providing entity that are not fully reimbursed by OPM are recognized as imputed cost in the Statement of Net Cost and are offset by imputed financing sources included in the Other Financing Sources on the Statement of Changes in Net Position. Such imputed costs and imputed financing relate to business-type activities, employee benefits, and claims to be settled by the Treasury Judgment Fund. However, unreimbursed costs of goods and services other than those identified above are not included in our financial statements in accordance with SFFAS 55, Amending Inter-entity Cost Provisions.
H. Fund Balance with Treasury
OPM does not maintain cash in a commercial bank, but rather in Treasury. OPM’s Fund Balance with Treasury (FBWT) includes the amount available for OPM to pay current liabilities and finance authorized purchases, except as restricted by law. FBWT comprises the aggregate total of OPM’s unexpended, un-invested balances in its appropriation, trust, revolving, and trust revolving accounts. All of OPM’s collections are deposited and its expenditures are paid from one of its FBWT accounts. OPM invests FBWT balances associated with the Retirement, Health Benefits, and Life Insurance Programs that are not immediately needed to cover expenditures unless there is a Debt Issuance Suspension Period (DISP).
I. Investments, Net
The Federal Government does not set aside assets to pay future benefits or other expenditures. OPM invests the excess FBWT for the funds associated with the Retirement, Health Benefits, and Life Insurance Programs in securities guaranteed by the U.S. as to principal and interest. OPM’s investments in Federal securities consists of non-marketable Government Account Series (GAS) securities, both market-based notes and par-value. In addition, OPM holds marketable Treasury securities as a result of the tools used during a DISP. OPM invests the excess FBWT in the specific security type to match the need to pay future benefits or other expenditures with when the funds will be available. Investments are stated at the original acquisition cost, net of amortized premium and discount. Premiums and discounts are amortized into interest income over the term of the investment, using the interest method.
Market-based Notes
The notes consist of interest-bearing, market-based Treasury securities purchased from Treasury at a discount/premium. These investments are presented on OPM’s Balance Sheet at acquisition cost, net of amortization of the discount/premium. The discount is amortized over the life of the note using the interest method. Under the interest method, the effective interest rate (the actual interest yield on amounts invested) multiplied by the carrying amount of the note at the start of the accounting period equals the interest income recognized during the period (the carrying amount changes each period by the amount of the amortized discount/premium). The amount of the amortization of the discount/premium is the difference between the effective interest recognized for the period and the nominal interest for the note.
Health Benefits and Life Insurance Programs’ monies are invested, some in market-based securities that mirror the terms of marketable Treasury securities; monies that are immediately needed for expenditure are invested in overnight market-based securities. These market-based securities have some market value risk.
Par-value GAS securities and Certificates of Indebtedness
Retirement Program and the PSRHBF portion of the Health Benefits Program monies are invested initially in Certificates of Indebtedness (Certificates), which are issued by the Treasury at par value and mature on the following September 30. The Certificates are routinely redeemed at face value to pay for authorized program expenditures. Each September 30, all outstanding Certificates are rolled over into special GAS securities that are issued by Treasury at par value, with a yield equaling the average of all marketable Treasury securities with four or more years to maturity.
The Retirement Program also carries securities issued by the Federal Financing Bank (FFB) and a small number of other securities.
Debt Issuance Suspension Period (DISP)
On January 19, 2023, the Secretary of the Treasury announced that the U.S. had reached its statutory debt limit and began taking extraordinary actions— consistent with relevant laws—to avoid exceeding the debt limit. On June 3, 2023, the Fiscal Responsibility Act of 2023 was enacted, suspending the debt limit through January 1, 2025. On June 5, 2023, Treasury discontinued its use of extraordinary actions and resumed normal debt operations.
J. Accounts Receivable, Net
Accounts Receivables are recognized primarily when OPM performs reimbursable services or sells goods/services and consist of amounts owed to OPM intragovernmental and With the Public. Allowances for doubtful accounts are recorded to represent amounts estimated to be uncollectible, using aging methodologies, based on historical collection analysis for both intragovernmental and With the Public receivables.
K. Property, Plant, and Equipment, Net
OPM capitalizes major long-lived software and equipment. Software costing over $500 thousand is capitalized at the cost of either purchase or development and is amortized using a straight-line method over a useful life of five years. Equipment and other general Property, Plant, and Equipment (PP&E) costing over $25 thousand is capitalized at purchase cost and depreciated using the straight-line method over the useful life of the asset. The cost of minor purchases, repairs and maintenance is expensed as incurred.
In accordance with SFFAS 54, Leases, implementation in FY 2024, OPM evaluated intragovernmental and With the Public lease activity and determined amounts to be immaterial to report separately in the OPM financial statements. The requirements of the standard are applicable only if deemed material to the agency.
L. Other Assets
This represents the balance of assets held by the experience-rated carriers (ERC) participating in the Health Benefits Program and by the Life Insurance Program carrier, pending disposition on behalf of OPM.
M. Liabilities
Liabilities represent probable and measurable future outflows of resources as a result of past transactions or events and are recognized when incurred, regardless of whether there are budgetary resources available to pay the liabilities.
Liabilities Covered and not Covered by Budgetary Resources
Liabilities covered by budgetary resources include those liabilities for which appropriated funds and receipts are otherwise available to pay amounts due as of the Balance Sheet dates.
Liabilities not covered by budgetary resources are amounts owed in excess of available, congressionally appropriated funds and receipts, therefore, no budgetary resources are available to pay amounts due as of the Balance Sheet dates but will require future funding to liquidate the obligation. Since no budgetary resources have been made available to liquidate the Pension, PRHB, and Actuarial Life Insurance Liabilities, they are disclosed as being liabilities not covered by budgetary resources. In addition, OPM's liability due to the Treasury Judgment Fund, contingent liabilities, unfunded annual leave, and future estimates workers compensation do not have budgetary resources associated with the liability. (Refer to Note 8, Liabilities not covered by budgetary resources)
Current and Noncurrent Liabilities
OPM discloses its other liabilities not covered by budgetary resources between current and noncurrent liabilities in accordance with SFFAS 1. The current liabilities represent liabilities that OPM expects to settle within the 12 months of the Balance Sheet dates. Noncurrent liabilities represent liabilities that OPM does not expect to be settled within the 12 months of the Balance Sheet dates (refer to Note 8, Liabilities not covered by budgetary resources).
Accounts Payable
Accounts Payable includes amounts owed but not yet paid to intragovernmental and With the Public entities for goods and services received by OPM. OPM estimates and records accruals when services and goods are performed or received.
N. Federal Employee Salary, Leave and Benefits Payable
OPM records liabilities to represent expense incurred; however, not yet paid that relate to current employee salaries, leave, and benefits due and payable. A significant portion of this unpaid liability is for leave earned that an employee is entitled to upon separation that will be funded by future year budgetary resources. Benefits due and payable are comprised of two categories of accrued expenses. The first reflects claims filed by participants of the Retirement, Health Benefits and Life Insurance Programs that are unpaid in the current reporting period and includes an estimate of health benefits and life insurance claims incurred but not yet reported. The second is a liability for premiums payable to community-rated carriers (CRC) participating in the Health Benefits Program that is unpaid in the current reporting period.
O. Actuarial Liabilities and Associated Expenses
OPM records actuarial liabilities [the Pension Liability, PRHB Liability, and the Actuarial Life Insurance Liability] and associated expenses. These liabilities are measured as of the first day of the year, with a “roll-forward,” or projection, to the end of the year. The “roll-forward” considers all major factors that affect the measurement that occurred during the reporting year, including pay raises, cost of living allowances, and material changes in the number of participants.
Long Term Interest Rate Assumptions
For CSRS and for FERS, OPM’s actuaries determine a single interest rate that produces an actuarial liability equivalent to that produced under the 10-year average historical yield curve. OPM’s actuaries round the single equivalent interest rate to the nearest 0.1 percent.
OPM’s actuaries use a 10-year measuring period for determining the yield curve, taking the 40-quarter arithmetical average of spot rates for zero-coupon Treasuries measured through March 31 of the current fiscal year. OPM’s measuring period methodology has been in place under SFFAS 33, Pensions, Other Retirement Benefits, and Other Postemployment Benefits: Reporting the Gains and Losses from Changes in Assumptions and Selecting Discount Rates and Valuation Dates, since FY 2010. The March 31 ending date was selected based on the publication dates of source material to meet OPM’s financial reporting deadlines. Zero-coupon rates are published by the Treasury’s Office of Thrift Supervision
P. Commitments and Contingencies
In accordance with SFFAS 5, Accounting for Liabilities of the Federal Government, as amended by SFFAS 12, Recognition of Contingent Liabilities Arising from Litigation: An Amendment of SFFAS 5, Accounting for Liabilities of the Federal Government, OPM recognizes contingent liabilities in OPM’s Balance Sheets and Statements of Net Cost when the loss is determined to be probable and reasonably estimable. In the event of an adverse judgment against the Government, some of the liabilities may be payable from Treasury. OPM evaluates all contingent liabilities based on three criteria: probable, reasonably possible, and remote. OPM recognizes that the estimated liability may be a specific amount or a range of amounts. If some amount within the range is a better estimate than any other amount within the range, that amount is recorded. If no amount within the range is a better estimate than any other amount, the minimum amount of the range is recorded and the range and a description of the nature of the contingency are disclosed. OPM records an accrual for contingent liabilities if it is probable and reasonably estimable and discloses those contingencies that are reasonably possible in Note 9, Commitments and Contingencies, of the financial statements. OPM does not disclose or record contingent liabilities when the loss is considered remote. For matters where OPM’s General Counsel is unable to express an opinion regarding the likely outcome of the case and an estimate of the potential liability cannot be made, the total amount claimed against the Government is classified as Reasonably Possible, which meant that the possibility of the loss occurring is more than remote but less than probable and disclosed if available.
Q. Net Position
Net position is the residual difference between assets and liabilities and consists of Unexpended Appropriations and Cumulative Results of Operations.
Unexpended Appropriations
Unexpended appropriations consist of unobligated and Undelivered Order balances. Unobligated balances are amounts of remaining budgetary resources available for obligation, which have not been rescinded or withdrawn. Undelivered Orders are the amount of obligations incurred for goods and/or services ordered, but not yet received.
Cumulative Results of Operations
Cumulative results of operations (CRO) consist of the net difference since inception between: (1) expenses and losses; (2) revenue and gains; and (3) other financing sources. The balance of OPM’s CRO is negative due to the recognition of actuarial expenses that will be funded and liquidated in future periods.
R. Expenses
Expenses are recognized when there are outflows, usage of assets, or incurrences of liabilities (or a combination) from carrying out functions related to OPM’s activity and related programs, for which benefits do not extend beyond the present operating period. For financial reporting purposes, operating expenses are recognized in the period incurred.
S. Revenue and Other Financing Sources
In accordance with SFFAS 7, Accounting for Revenue and Other Financing Sources and Concepts for Reconciling Budgetary and Financial Accounting, revenue is classified as either exchange revenue or non-exchange revenue.
Exchange Revenue
Exchange revenue is an inflow of resources to an entity that it has earned; it arises when each party to a transaction sacrifices value and receives value in return. All of OPM’s revenue is classified as exchange revenue and the two sources of earned revenue include (1) earning on its investments; and (2) the Contributions to the Retirement, Health Benefits and Life Insurance Programs by and for participants.
Federal reporting standards require that earnings on investments be classified in the same manner as the predominant source of revenue that funds the investments; OPM, therefore, classifies earnings on investments as earned revenue. Employing agency and participant contributions to the Retirement, Health Benefits and Life Insurance Programs and the scheduled payment contributions to the PSRHBF are classified as exchange revenue, since they represent exchanges of money and services in return for current and future benefits.
Exchange revenue is presented in the OPM’s Statements of Net Cost and serves to offset the costs of these goods and services. The Statements of Net Cost provides users with the ability to ascertain whether OPM’s exchange revenue are sufficient to cover the total cost it has incurred to provide Retirement, Health Benefits, and Life Insurance Program benefits.
T. 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.
U. Reclassifications
In FY 2024, Treasury crosswalk updates included a change in liability presentation between post-retirement benefits and current employee benefits payable on the Balance Sheet. Related FY 2023 amounts have been reclassified to conform to the revised presentation requirements. OPM also made a few other minor reclassifications to the comparative financial statements and notes disclosures to better align with OPM policies and procedures; and in accordance with Treasury Financial Manuals and the FY 2024 OMB Circular A-136.
Note 2, Fund Balance with Treasury
Status of Fund Balance with Treasury
OPM’s unexpended balances are comprised of its FBWT and its investments (at par, net of original discount). Obligated and unobligated balances reported for the Status of FBWT do not agree with obligated and unobligated balances reported in the Combined Statement of Budgetary Resources due to budgetary balances that are supported by amounts other than FBWT, such as Federal budgetary receivables and unfilled customer orders. These resources provide budget authority; however, do not contribute to FBWT on the Balance Sheet until collected. OPM had approximately $3.2 billion and $3.3 billion as of September 30, 2024 and 2023, respectively, of available resources excluded from uncollected budgetary resources. In addition, there were approximately $264 million and $251 million as of September 30, 2024 and 2023, respectively, of unavailable resources excluded from uncollected budgetary resources. These exclusions required for the reconciliation of FBWT often result in a presentation of abnormal available or unavailable budgetary resources to be interpreted only that resources presented on the Statement of Budgetary Resources are not supported by amounts in FBWT. This does not mean OPM has negative budgetary resources available or unavailable, but rather that resources available or unavailable are supported by other types of budget authority.
In order to reconcile our budgetary resources to ending FBWT, balances precluded from obligation and temporarily unavailable are needed as they are not included in the total budgetary resources or the status of budgetary resources on the Statement of Budgetary Resources. In addition, resources associated with investments in Federal securities are no longer in FBWT, and therefore removed. OPM did not have any FBWT related to Non-budgetary accounts such as deposit, clearing or unavailable receipt funds as of September 30, 2024 and 2023, respectively.
Unobligated funds, depending on the budget authority, are generally available for new obligations in current operations. The unavailable balance includes amounts appropriated in prior fiscal years, which are not available to fund new obligations. The obligated not yet disbursed balance represents amounts designated for payment of goods and services ordered but not yet received; or which payment has not yet been made. The following table presents a summary of OPM’s FBWT as of September 30, 2024, and 2023, respectively.
| Fund Balance with Treasury | Retirement Program | Health Benefits Program | Life Insurance Program | Other Programs | Total | |
|---|---|---|---|---|---|---|
| Unobligated: | Available | $- | $(1,629) | $400 | $(173) | $(1,402) |
| Unavailable | - | 19,044 | 52,593 | 316 | 71,953 | |
| Obligated Not Yet Disbursed | 9,866 | 8,140 | 1,708 | 648 | 20,362 | |
| Precluded from Obligations (See Note 10) | 1,062,557 | 28,197 | - | - | 1,090,754 | |
| Temporary Unavailable | 5 | 16 | - | - | 21 | |
| Less: Invested Budgetary Resources No Longer in FBWT | (1,072,349) | (51,853) | (54,688) | - | (1,178,890) | |
| Fund Balance with Treasury | $79 | $1,915 | $13 | $791 | $2,798 | |
| Fund Balance with Treasury | Retirement Program | Health Benefits Program | Life Insurance Program | Other Programs | Total | |
|---|---|---|---|---|---|---|
| Unobligated: | Available | $- | $128 | $593 | $(151) | $570 |
| Unavailable | - | 19,000 | 49,983 | 322 | 69,305 | |
| Obligated Not Yet Disbursed | 9,640 | 8,137 | 1,686 | 615 | 20,078 | |
| Precluded from Obligations (See Note 10) | 1,028,114 | 32,050 | - | - | 1,060,164 | |
| Temporary Unavailable | 5 | 15 | - | - | 20 | |
| Less: Invested Budgetary Resources No Longer in FBWT | (1,036,636) | (57,508) | (52,249) | - | (1,146,393) | |
| Fund Balance with Treasury | $1,123 | $1,822 | $13 | $786 | $3,744 | |
Note 3, Investments, Net
All of OPM’s investments are in securities issued by other Federal entities and are therefore classified as intragovernmental. See Note 1.I for further explanation, including the amortization method. All OPM’s investments are with Treasury, either in GAS securities or with the FFB securities, held by trust funds - the Retirement, Health Insurance, and Life Insurance Programs.
With the Public cash receipts are collected for the trust funds; and are deposited with Treasury, which uses the cash for general Government purposes. Treasury securities are issued to OPM as evidence of its receipts. Treasury securities are an asset to OPM and a liability to Treasury. Because OPM and Treasury are both parts of the Government, these assets and liabilities offset each other from the standpoint of the Government as a whole. They are eliminated in consolidation for the Financial Report of the U.S. Government (FR).
Treasury securities provide OPM with authority to draw upon the Treasury to make future benefit payments or other expenditures. When OPM requires redemption of these Treasury securities to make expenditures, the Government finances those expenditures out of accumulated cash balances by raising taxes or other receipts, borrowing from the public, repaying less debt, or curtailing other expenditures. This is the same way the Government finances all other expenditures.
Market-based GAS securities carry an additional risk, if not carried to maturity. Health and Life both invest in these securities and, if redeemed early, may receive less value in return for the security it gave up.
The following table summarizes OPM’s Investments, Net, as of September 30, 2024 and 2023, respectively:
Note 4, Accounts Receivable, Net
Intragovernmental
The balances comprising OPM’s intragovernmental accounts receivable as of September 30, 2024, and 2023, respectively, are reported in the following table:
The USPS is required to make annual contributions to the CSRDF for both CSRS and FERS under Section 8348 (h) and Section 8423 (b) of Title 5, U.S.C. As of September 30, 2024, total contributions owed was $27.3 billion, of which OPM has deemed $27.1 billion to be uncollectible due to continued growth and aging of the receivable as a result of USPS budget constraints. All other intragovernmental receivables are considered collectible.
With the Public
The balances comprising the accounts receivable, net OPM classifies as “With the Public” as of September 30, 2024, and 2023, respectively, are presented, in the following table. See Note 1.J for the methodology used to determine the allowance.
Note 5, Federal Employee Salary, Leave, and Benefits Payable
Federal Employee Salary, Leave, and Benefits Payable represent amounts due for employees currently employed by OPM. These liabilities do not represent amounts due that relate to pension or post-employment benefits.
The table below provides a breakdown of the Federal Employee Salary, Leave, and Benefits Payable reported on the Balance Sheet as of September 30, 2024, and 2023, respectively.
Note 6, Pensions, Other Post-Employment Benefits Payable
A. Pensions, Other Post-Employment Benefits Payable
Pensions and OPEB Payable include actuarial estimates of all future post-employment benefits for Retirement, Health Benefits and Life Insurance Programs based on certain economic assumptions. In addition, it includes claims or benefits on behalf of employees that have not yet been submitted to the insurer, actual benefits due to employees and their beneficiaries, and actuarial FECA liability representing a present value of future benefits provided as a result of work-related deaths, disability, or occupational disease.
The table below provides a breakdown of the Pensions, OPEB Payable reported on the Balance Sheet as of September 30, 2024, and 2023, respectively.
B. Reconciliation of Actuarial Liabilities
The table below provides a reconciliation of current year activity in actuarial liabilities by program as of September 30, 2024, and 2023, respectively. Current year actuarial estimates are based on economic assumptions described in section C.
| Reconciliation of Actuarial Liabilities | Pension | Health | Life | Total | ||
|---|---|---|---|---|---|---|
| CSRS | FERS | |||||
| Beginning Actuarial Liability Balance | $1,180,800 | $1,495,300 | $380,137 | $64,500 | $3,120,737 | |
| Expense: | Normal Cost1 | 1,235 | 70,530 | 19,946 | 675 | 92,386 |
| Interest on the Liability Balance | 27,469 | 45,412 | 11,841 | 1,805 | 86,527 | |
| Actuarial (Gain)/Loss: | From Experience | 4,786 | 25,867 | 770 | 1,921 | 33,344 |
| From Assumption Changes | 12,249 | 41,696 | 29,765 | 80 | 83,790 | |
| Total Expense | $45,739 | $183,505 | $62,322 | $4,481 | $296,047 | |
| Less Amounts Paid: | Benefits and Annuities Paid | (74,034) | (33,328) | (14,658) | (715) | (122,735) |
| Administrative and Other Expenses | (105) | (77) | (1,582) | (10) | (1,774) | |
| Totals Amounts Paid | ($74,139) | ($33,405) | ($16,240) | ($725) | ($124,509) | |
| Ending Actuarial Liability Balance | $1,152,400 | $1,645,400 | $426,219 | $68,256 | $3,292,275 | |
Footnote 1
Life - represents new entrant expense.
| Reconciliation of Actuarial Liabilities | Pension | Health | Life | Total | ||
|---|---|---|---|---|---|---|
| CSRS | FERS | |||||
| Beginning Actuarial Liability Balance | $1,170,500 | $1,308,500 | $411,673 | $61,258 | $2,951,931 | |
| Expense: | Normal Cost1 | 1,348 | 60,657 | 18,657 | 586 | 81,248 |
| Interest on the Liability Balance | 26,094 | 38,376 | 12,786 | 1,714 | 78,970 | |
| Actuarial (Gain)/Loss: | From Experience | (4,767) | 25,176 | (1,832) | 458 | 19,035 |
| From Assumption Changes | 61,337 | 93,381 | (44,046) | 1,179 | 111,851 | |
| Total Expense | $84,012 | $217,590 | $(14,435) | $3,937 | $291,104 | |
| Less Amounts Paid: | Benefits and Annuities Paid | (73,566) | (30,713) | (15,574) | (685) | (120,538) |
| Administrative and Other Expenses | (146) | (77) | (1,527) | (10) | (1,760) | |
| Totals Amounts Paid | ($73,712) | ($30,790) | ($17,101) | ($695) | ($122,298) | |
| Ending Actuarial Liability Balance | $1,180,800 | $1,495,300 | $380,137 | $64,500 | $3,120,737 | |
C. Actuarial Liability Economic Assumptions
Pension Benefits
The OPM Office of the Actuaries, in computing the Pension Liability and associated Pension Expense, applies economic assumptions to historical cost information to estimate the Government’s future cost to provide CSRS and FERS benefits to current and future retirees. The estimate is adjusted by the time value of money and the probability of having to pay benefits due to assumed decrements for mortality, morbidity, and terminations. Actuarial gains or losses occur to the extent that actual experience differs from these assumptions used to compute the Pension Liability and associated Pension Expense.
The economic assumptions used to calculate the Pension Liability and related Pension Expense under SFFAS 33, Pensions, Other Retirement Benefits, and Other Postemployment Benefits: Reporting the Gains and Losses from Changes In Assumptions and Selecting Discount Rates and Valuation Dates are based on 10-year historical averages. See Note 1.O for further information. These economic assumptions differ from those established by OPM under guidance from the CSRS Board of Actuaries for the determination of certain statutory funding payments for CSRS and FERS. The following table presents the significant economic assumptions in accordance with SFFAS 33 to compute the Pension Liability as of September 30, 2024, and 2023, respectively:
| Pension Economic Assumptions | September 30, 2024 | September 30, 2023 | ||
|---|---|---|---|---|
| CSRS | FERS | CSRS | FERS | |
| Inflation | 2.8% | 2.8% | 2.6% | 2.6% |
| Interest Rate/Discount Rate | 2.5% | 3.0% | 2.4% | 3.0% |
| Cost of Living Adjustment1 | 2.8% | 2.4% | 2.6% | 2.3% |
| Rate of Increase in Salary | 2.5% | 2.5% | 2.1% | 2.1% |
Footnote 1
The actuarial liability for CSRS and FERS is determined based on an assumed rate of COLA, an assumption that is related to the general rate of inflation. The assumed CSRS COLA is equal to the assumed rate of inflation.
Post Retirement Health Benefits
The OPM Office of the Actuaries, in computing the PRHB Liability and associated expense, applies economic assumptions to historical cost information to estimate the Government’s future cost of providing PRHB to current employees and retirees. The estimate is adjusted by the time value of money and the probability of having to pay benefits due to factors such as mortality, retirements, and terminations. Actuarial gains or losses will occur to the extent that actual experience differs from the assumptions used to compute the PRHB Liability and associated expense, and due to changes to the actuarial assumptions. The amount for Federal Employee Benefits Payable for PRHB on the Balance Sheet also includes claims payable and benefits due to Health Insurance carriers.
The following table presents the significant economic assumptions used to compute the PRHB Liability and related expense for the year ended September 30, 2024 and 2023, respectively.
| Post Retirement Economic Assumptions | September 30, 2024 | September 30, 2023 |
|---|---|---|
| Interest Rate1 | 3.2% | 3.1% |
| Increase in Per Capita Cost of Covered Benefits2 | 5.2% | 4.9% |
| Ultimate Medical Trend Rate | 4.2% | 4.0% |
Footnote 1
The single equivalent annual interest rate for FY 2024 is derived from a yield curve based on the average of the last 40 quarters through March 2024. The single equivalent annual interest rate for FY 2023 is derived from a yield curve based on the average of the last 40 quarters through March 2023.
Footnote 2
The single equivalent increase in per capita cost of covered benefits for FY 2024 represents a variable trend which begins at 7.0 percent in the initial and second year, 6.5 percent in the third year, 6.0 percent in the fourth year, 5.5 percent in the fifth year, then steadily declines to 4.2 percent by FY 2075.
Life Insurance Benefits
The Actuarial Life Insurance Liability (ALIL) is the expected present value (EPV) of future benefits to be paid to, or on behalf of, existing Life Insurance Program participants, less the EPV of future contributions to be collected from those participants. As of September 30, 2024, the total amount of FEGLI insurance in-force was estimated at $858.3 billion ($748.6 billion employees + $109.7 billion annuitants). As of September 30, 2023, the total amount of FEGLI insurance in-force was estimated at $800.8 billion ($692.2 billion employees + $ 108.6 billion annuitants). .
In applying SFFAS 33 for calculating the ALIL, OPM’s actuary uses salary increase and interest rate yield curve assumptions that are consistent with those used for computing the CSRS and FERS Pension Liability in FY 2024 and FY 2023. This entails the determination of a single equivalent interest rate that is specific to the ALIL. See the table below.
| Life Insurance Economic Assumptions | September 30, 2024 | September 30, 2023 |
|---|---|---|
| Interest Rate | 2.9% | 2.8% |
| Rate of Increases in Salary | 2.5% | 2.1% |
Note 7, Other Liabilities
Other Liabilities are liabilities not reported elsewhere in the Balance Sheet. They consist of funded and unfunded intragovernmental and With the Public liabilities. The following table presents the other liabilities reported on OPM’s Balance Sheet as of September 30, 2024, and 2023, respectively.
Health Benefits Program
In prior years, OPM was a party to litigation in which certain Health Benefits Program carriers were seeking relief for alleged underpayment of premiums. As a result of one adverse court decision, the DOJ, which represented OPM in the litigation, settled most of the remaining cases (one other case was tried and lost). Judgments/settlements in those cases were paid from the Treasury Judgment Fund. However, because any underpayments that may have occurred resulted from inaccuracies in the number of contributions by or on behalf of employee-participants that were remitted to OPM by the employing agencies (which remittances came from the respective agencies’ appropriations), OPM has neither the legal responsibility nor the legal authority to reimburse the Treasury Judgment Fund. Treasury continues to assert that OPM is liable to reimburse the Treasury Judgment Fund for amount of the judgments/settlements. As a result, OPM carries $260 million as of September 30, 2024, and 2023, respectively, as intragovernmental Other Liabilities due to the Treasury.
Note 8, Liabilities Not Covered by Budgetary Resources
Liabilities covered by budgetary resources include those liabilities for which appropriated funds and receipts are otherwise available to pay amounts due as of the Balance Sheet dates.
Liabilities not covered by budgetary resources are amounts owed in excess of available, congressionally appropriated funds and, therefore, no budgetary resources are available to pay amounts due as of the Balance Sheet dates but will require future funding. Since no budgetary resources have been made available to liquidate the Pension, PRHB, and Actuarial Life Insurance Liabilities, they are disclosed as being liabilities not covered by budgetary resources. OPM’s other unfunded liabilities include contingent liabilities. OPM estimates approximately $84 million of the liabilities not covered by budgetary resources to be considered current liabilities as they are expected to become due within the next fiscal year. The unfunded liabilities as of September 30, 2024, and 2023, respectively, are presented in the following table:
Note 9, Commitments and Contingencies
OPM is party to various administrative proceedings, legal actions, and claims. For legal actions where the OGC considers adverse decisions “probable” or “reasonable possible” and the amounts are reasonably estimable, information is disclosed below. In many cases, tort claims are administered and resolved by DOJ, and any amounts necessary for resolution are obtained from a special Judgment Fund maintained by Treasury. In accordance with the FASAB’s Interpretation 2, Accounting for Treasury Judgment Fund Transactions, costs incurred by the Federal Government are to be reported by the agency responsible for incurring the liability, or to which liability has been assigned, regardless of the ultimate source of funding. No amounts have been accrued in the financial records for claims where the amount of potential loss cannot be estimated, or the likelihood of an unfavorable outcome is less than probable.
The amounts as of September 30, 2024, and 2023, respectively, are presented in the table below.
Note 10, Availability of Unobligated Balances
Retirement Program
Historically, OPM’s trust fund receipts have exceeded the amount needed to cover the Retirement Program’s obligations. The excess of trust fund receipts over incurred obligations is classified as being temporarily precluded from obligation. These receipts, however, remain assets of the CSRDF and will become immediately available, if circumstances dictate, to meet obligations to be incurred in the future.
The following table presents the unobligated balance of the CSRDF that is included in the Retirement Program that is temporarily precluded from obligation for September 30, 2024 and 2023, respectively:
Health Benefits and Life Insurance Programs
OPM administers the Health Benefits and Life Insurance Programs through three trust revolving funds. A trust revolving fund is a single account that is authorized to be credited with receipts and incur obligations and expenditures in support of a continuing cycle of business-type operations in accordance with the provisions of statute. The unobligated balance in OPM’s trust revolving funds is available for obligation and expenditure, upon apportionment by OMB, without further action by Congress.
Additionally, the FY 2024 and FY 2023 receipts included interest income. The following table presents the unobligated balance of the PSRHBF included in the Health Benefits Program that is temporarily precluded from obligation as of September 30, 2024, and 2023, respectively.
Other Programs
OPM’s Other Programs consist of the Revolving Fund and S&E. The Revolving Fund Programs are administered through an intragovernmental revolving fund. An intragovernmental revolving fund is designed to carry-out a cycle of business-type operations with other Federal agencies or separately funded components of the same agency. The unobligated balance in OPM’s intragovernmental revolving fund is available for obligation and expenditure, upon apportionment by OMB, without further action by Congress.
OPM funds its administrative costs through annual, multiple-year, and “no-year” appropriations. For its annual appropriations, the unobligated balance expires at the end of the applicable fiscal year. For OPM’s multiple-year appropriations, the unobligated balance remains available for obligation and expenditure for a specified period in excess of a fiscal year. For its no-year appropriations, the unobligated balance is carried forward and is available for obligation and expenditure indefinitely until the objectives for which it was intended have been accomplished.
Note 11, Apportionment Categories of Incurred Obligations
An apportionment is a distribution by OMB of amounts available for obligation. Apportioned amounts appear on different groups of lines in the Application of Budgetary Resources section of an apportionment. Amounts are identified in an apportionment: by time - [Category A]; by program, project or activity [Category B]; or by a combination of program, project or activity and time period [Category AB]. If an account is not subject to an apportionment, it is considered exempt [Category E]. Each of OPM’s trust funds have an exempt account that receives warrants from the General Fund of the U.S. Government each fiscal year to subsidize current year premium costs incurred by the Retirement, Health Benefits, and Life Insurance Program benefits. The following table details the direct and reimbursable obligations that have been incurred against each apportionment category as of September 30, 2024, and 2023, respectively.
Note 12, Comparison of Combined Statements of Budgetary Resources to the President’s Budget
OPM reports information about budgetary resources in the Combined Statements of Budgetary Resources (SBR) and for presentation in the “President’s Budget.” The President’s Budget for FY 2026, which will contain the actual budgetary resources information for FY 2024, will be available on a later date at President’s Budget | The White House. The President’s Budget for FY 2025, which contains actual budgetary resource information for FY 2023, was released on March 11, 2024. See the table below for comparison of Combined Statements of Budgetary Resources to the President’s Budget.
Note 13, Combined Statements of Budgetary Resources
A. Undelivered Orders
Federal and Non-federal Undelivered Orders represent goods and services ordered and obligated which have not been received. This includes any orders for which we have paid in advance, but for which delivery or performance has not yet occurred prior to fiscal year-end. OPM’s Other Programs, which includes the Revolving Fund Program as well as S&E, had Undelivered Orders as of September 30, 2024, and 2023, respectively, that are presented in the table below.
B. Adjustments to Unobligated Balances Brought Forward
The unobligated balance from prior year budget authority, net amount does not tie to the prior year’s unobligated balance, end of year amount due to adjustments. The adjustments mainly consist of recoveries of prior year obligated balances, cancelled authority, and allocation transfers of prior year balances. The following table displays a reconciliation between the prior year’s unobligated balance, end of year amount to the current year’s unobligated balance from prior year budget authority, net amount. Adjustments to unobligated balances brought forward as of September 30, 2024 and 2023, respectively, are presented in the table below.
Note 14, Reconciliation of Net Cost to Net Outlays
Budgetary and financial accounting information differ. Budgetary accounting is used for planning and control purposes and relates to both the receipt and use of cash, as well as reporting the Federal deficit. Financial accounting is intended to provide a picture of the Government’s financial operations and financial position, so it presents information about costs arising from the consumption of assets and the incurrence of liabilities. 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. As required by SFFAS 7, as amended by SFFAS 53, OPM has reconciled the net cost of operations, reported in the Statement of Net Costs, to the net outlays, reported on the SBR.
The reconciliation serves not only to identify costs paid for in the past and those that will be paid in the future, but also to assure integrity between budgetary and financial accounting. The analysis below illustrates this reconciliation by listing the key differences between net cost and net outlays. Per the FY 2024 OMB Circular A-136, the key differences fall into three categories. (1) Components of net cost that are not part of net outlays, (2) Component of net outlays that are not part of net costs, and (3) Other Temporary Timing Difference section. OPM did not have any activity to report in the third category in FY 2024 and FY 2023, therefore, not disclosed.
Note 15, Health Benefits / Life Insurance Program Concentrations
During FY 2024 and FY 2023 over three-fourths of the Health Benefits Program’s benefits were administered by the Blue Cross and Blue Shield Association, a fee-for-service carrier that provides experience-rated benefits.
For the Life Insurance Program, nearly all the benefits were administered by the Metropolitan Life Insurance Company in each of the fiscal years.
Note 16, Reclassification of Statement of Net Cost and Statement of Changes in Net Position for FR Compilation
To prepare the FR, the Treasury requires agencies to submit an adjusted trial balance, which is a listing of amounts by U.S. Standard General Ledger account that appears in the financial statements. Treasury uses the trial balance information reported in the Government-wide Treasury Account Symbol Adjusted Trial Balance System (GTAS) to develop a Reclassified Balance Sheet, Reclassified Statement of Net Cost, and a Reclassified Statement of Changes in Net Position for each agency, which are accessed using GTAS. Treasury eliminates all intragovernmental balances from the reclassified statements and aggregates lines with the same title to develop the FR statements. This note shows OPM financial statements and the reclassified statements prior to elimination of intragovernmental balances and prior to aggregation of repeated FR line items. A copy of the 2023 FR can be found here: 2023 Financial Report (FR) and a copy of the 2024 FR will be posted to this site as soon as it is released.
The term, intragovernmental, is used in this note to refer to amounts that result from other components of the Federal Government. The term, Non-federal, is used in this note to refer to Federal Government amounts that result from transactions with Non-federal entities. These include transactions with individuals, businesses, non-profit entities, and State, local, and foreign governments.
| OPM's Statement of Net Cost | Line Items Used to Prepare FY 2024 Government-wide - SNC | ||
|---|---|---|---|
| Financial Statement Line | Amounts | Adjusted Amount | Reclassified Financial Statement Line |
| Gross Costs | $274,696 | $270,024 | Non-federal gross cost |
| 1 | Federal gross cost - Benefits program costs | ||
| 43 | Federal gross cost - Imputed costs | ||
| 4,628 | Federal gross cost - Buy/Sell cost1 | ||
| Total Gross Costs | $274,696 | $274,696 | Total Gross Costs |
| Earned Revenue | 150,120 | 31,880 | Non-federal earned revenue |
| 85,710 | Federal earned revenue - Benefit program revenue | ||
| 1,047 | Federal earned revenue - Buy/Sell revenue1 | ||
| 31,481 | Federal earned revenue - Federal securities interest revenue including associated gains and losses | ||
| 2 | Federal earned revenue - Collections transferred into a TAS other than the General Fund | ||
| Total Earned Revenue | $150,120 | $150,120 | Total Earned Revenue |
| Gain/Loss on Pension, ORB, or OPEB Assumption Changes | 83,790 | 83,790 | Gains/losses from changes in actuarial assumptions |
| Net Cost of Operations | $208,366 | $208,366 | Net Cost of Operations |
Footnote 1
Treasury's Reclassified Statement of Net Cost lines adjusted for intradepartmental elimination differences.