Budgetary Information

FASAB Contact: Ross Simms, simmsr@fasab.gov, 202-512-2512

This project is a segment of the Board’s reporting model initiative. Prior to February 2020, the Board conducted the reporting model phase II project to consider improvements to budgetary information. The Board later decided to align phase II with two other projects intended to improve the reporting model, management’s discussion and analysis improvements and note disclosures. Consequently, the reporting model phase II project is now the budgetary improvements project.

The budgetary improvements project addresses certain issues related to accounting and financial reporting for government-wide and component reporting entity budgetary information. The project will consider improvements to the existing guidance related to: 1) the usefulness of the required U.S. budget surplus/deficit presentations, and 2) the understandability of the required presentation for component reporting entity budgetary resources.

HISTORY OF BOARD DELIBERATIONS

June 24 – 25, 2020

During the June 2020 meeting, the Board considered the task force’s progress. The task force was considering retaining the existing statement of budgetary resources (SBR) as a basic statement and developing disclosures to improve its understandability. However, the Board preferred to develop alternatives to the SBR and noted that disclosures may not be effective. In addition, members suggested engaging external users in discussing alternatives.

Briefing materials – TAB G

February 26-27, 2020

Reporting Model: Budgetary Information

As part of the budgetary information project discussion, Ms. Carol Johnson, policy analyst, OMB, provided an overview of the budgetary information available to the public and discussed the federal budget process. In addition, Ms. Johnson discussed key budget concepts and noted that the purpose of budgetary accounting is to ensure compliance with budget laws.

The Board agreed to proceed with plans to improve budgetary reporting and requested that staff consider the following:

  • Users’ needs and the key challenges they have in understanding budgetary information, such as the format of the presentation.
  • The issuance of an invitation to comment prior to an ED.
  • The most important budgetary information a general audience of users would need to know.
  • Electronic reporting capabilities and how they might play a role in improving the information and assisting users in understanding the information.
  • Opportunities for improving guidance for management’s discussion and analysis (MD&A), note disclosures, and related presentations such as the budget and accrual reconciliation.

Issue Papers for February 26-27, 2020:

Tab A (PDF)

Tab B (PDF)

December 17-18, 2019

Staff presented an education session to discuss

  • the interrelationships among the current reporting model phase II, note disclosures, and management’s discussion and analysis (MD&A) amendments projects;
  • common objectives; and
  • next steps.

The Board agreed to maintain the current approach, conducting the reporting model phase II, note disclosures, and MD&A projects concurrently. Members believed that more progress could be made using this approach.

Issue Paper for December 17-18, 2019 – Tab F (PDF)

October 23-24, 2019

During the October 2019 meeting, FASAB discussed plans to research improvements in budgetary reporting. Members noted the importance of determining user needs and discussed topics and questions that should be addressed during the research. Users have access to a broad range of budgetary data through the federal government’s open data website, the Office of Management and Budget, and agency websites. Therefore, the project could consider the potential gaps in information that general purpose federal financial reports might address. The Board also noted that the overall project involves several broad topics: budgetary information, performance information, electronic reporting, and data quality and integration. Consequently, the Board decided to develop a vision statement that considers the common areas among the topics and guides the project.

Issue Paper for October 23-24, 2019 – Tab E (PDF)

August 28-29, 2019

During its August meeting, FASAB discussed and approved a proposed project plan that focused on improving component reporting entity budgetary and performance information in the federal government’s open data environment. Members provided suggestions for improving the project approach and requested that staff develop additional details for the planned research and project outputs.

Also, although the proposed plan was intended to focus on component reporting entity issues, members agreed that the project should consider a framework that includes the government-wide perspective as well as component reporting entities. For the October meeting, staff will provide additional details for the planned research and will incorporate members’ suggestions in a revised plan.

Issue Paper for August 28-29, 2019 – Tab E (PDF)

June 26-27, 2019

The Board determined that improving budgetary information reporting, performance reporting, electronic reporting, and data quality and integration were high priority areas of the reporting model. Board members noted that the topics were interrelated. Also, the format of reported budgetary information needs improvement, and there is a need for integrated budget and performance information. For the August 2019 meeting, staff will develop a plan to address the high priority areas.

Issue Paper for June 26-27, 2019 – Tab H (PDF)

April 24-25, 2019

The Board did not discuss the reporting model phase II project during the April 2019 Board meeting.

February 27, 2019

The Board did not discuss the reporting model phase II project during the February 2019 Board meeting.

December 19-20, 2018

The Board did not discuss the reporting model phase II project during the December 2018 Board meeting.

October 24-25, 2018

The Board did not discuss the reporting model phase II project during the October 2018 Board meeting.

August 29-30, 2018

Phase II of the reporting model project was not discussed during the August 2018 meeting.

June 27-28, 2018

While the Board did not discuss phase II at the June 2018 meeting, research on an electronic reporting model is ongoing and staff is conducting interviews with potential users. In one interview, the respondent indicated that the public is becoming accustomed to rapid data access and “seconds matter.” Hunting through a presentation in portable document format seems to take a lifetime relative to using computer technology and accessing machine-readable data. Analysts prefer to scan a website electronically and may assume the information is not available if it is not located within seconds. This respondent’s views highlighted the opportunities that exist for improving financial data access in the age of artificial intelligence and machine learning.

April 25-26, 2018

The Board reviewed a presentation that demonstrated the benefits of electronic reporting versus paper-based reporting. Currently, the project is in the design stage; the Board reviewed website wireframes or blueprints. The wireframes included a list of questions that users may wish to have answered. The user would click on the question and immediately go to information that answers the question. The presentation also included mouse overs to explain technical matters, data visualizations, and financial statements that allow the user to click on a line item and drill down to additional information.

The presentation also included ideas for additional tools to engage users such as a landing page designed to guide users with different levels of expertise, a search feature, and/or a chatbot that could assist users in answering questions, including those that may not be tied to traditional financial statements. A chatbot uses artificial intelligence to conduct a conversation with the user.

Staff plans to reach out to users and learn more about their needs and the possibilities for electronic reporting.

Issue Paper for April 25-26, 2018 – Tab D (PDF)

February 21-22, 2018

In considering a reporting model for the future, the Board observed a demonstration of interactive data visualizations, management’s discussion and analyses (MD&As), and financial statements. The interactive presentations considered the needs of users and were designed to help users understand financial information.

Mr. Justin Marsico, Senior Policy Analyst, Department of the Treasury (Treasury), presented a series of data visualizations. Treasury developed the visualizations to help users understand and explore data collected as part of the Digital Accountability and Transparency (DATA) Act of 2014. Mr. Marsico’s presentation included a sankey diagram and a dendrogram. The sankey diagram linked budget functions to object classes and illustrated the magnitude of the relationships. The dendrogram listed each federal agency and allowed users to drill down from the agency level to the sub-agency level and to the federal accounts that comprise sub-agency spending. Users could also view a federal account profile to gain a better understanding of how agencies receive and spend congressional funding to carry out their programs, projects, and activities.

The Board also observed an interactive MD&A and interactive financial statements developed by a team from Deloitte & Touche LLP. The interactive MD&A included tips to help users understand technical terms, a sankey diagram of budgetary resources, a radar chart comparing the net cost for five programs over multiple periods, and a geospatial heat map of net cost by state with drill-down capability enabling users to view amounts by congressional district. The interactive financial statements also provided drill-down capability. The drill-down feature enabled users to learn more about the details of financial statement line item balances.

The Board encouraged continued progress in electronic reporting. The Deloitte team included Mr. Justin Reed, Partner; Ms. Tasha Austin, Senior Manager; Mr. Daniel Shorstein, Manager; Ms. Tanya Bagheri, Business Technology Analyst; Ms. Reem El Seed, Consultant; and Mr. Dai Tran, Specialist Master.

The Board subsequently discussed whether to revisit certain topics within Statement of Federal Financial Accounting Concepts (SFFAC) 3, Management’s Discussion and Analysis. The possible topics included revisiting (1) SFFAC 3 for standards or implementation guidance; (2) the role of MD&A; (3) the scope of MD&A; (4) the schematic diagram of a sample general purpose federal financial report (GPFFR); (5) the intended audience for MD&A and GPFFRs; (6) the financial statements discussion; (7) the systems, control, and legal compliance discussion; and/or (8) the performance discussion. Board members discussed the topics for revisiting SFFAC 3 and noted that they were integrated rather than stand-alone topics. Consequently, the Board agreed that implementation guidance should be developed to help improve the content of MD&As. The Board noted that component reporting entities could be more creative and use interactive technology. Existing standards do not preclude reporting entities from using the technology.