what's at stake? the u.s. government’s financial statements and the country's fiscal...

What's at Stake?The U.S. Government’s Financial Statements and the Country's Fiscal Health

The role of CPAs

• Serve as trusted advisors to a variety of organizations

• Help businesses and individuals achieve strong financial standing

• Protect the public interest• Explain complex financial issues

Today

• Overview of the federal budget• Insights into the federal financial statements• Nation’s deficit reality

Federal budget

Establishes the fiscal

goals envisioned by Congress

Measured on a cash

basis

Tool to help guide

spending decisions

Federal financial statements

Record of what has actually

happened

Prepared on an accrual

basis

Provide information

about longer-term implications

Revenue = $2.4 trillion Expenses = exceeded

revenue by $1.3 trillion

2012 financial statements

Assets=$2.7 trillion

Liabilities=$18.8 trillion

Accumulated deficit=

$16.1 trillion

2012 financial statements

U.S. financial statements differ from other organizations

Most financial statements show obligations or liabilities on balance sheet

U.S. government’s financial statements do not include Social Security and Medicare

• Footnote disclosures • Not reflected as liabilities

Reality of future obligations

These future obligations equal:

Additional social insurance deficit $52 trillion

Cumulative deficit 16 trillion

Total deficit $68 trillion

Key data in publicly traded company’s financial statements

Revenue: how much money the company

is bringing in

Expenses: how much money the

company is spending

EarningsExpenses < Revenue

= Financially Healthy Company

In tr

illio

ns

2009 2010 2011 2012

$11.5

$13.5$14.8

$16.1

Accumulated deficit

What’s next

Visit: aicpa.org/Wha

tsAtStake

Watch What’s at Stake: The CPA Profession on

Federal Financial Responsibility

Policymakers: read the Financial Report

of the U.S. Government

Citizens: read A Citizen’s Guide to the Fiscal Year 2012 Financial Report of

the U.S. Government

Join the public dialogue to make the county’s fiscal health

a national priority

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(Add information about what you, your firm and/or your state society is doing in this area)

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