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Office of Budget

Fiscal Year 2004 Performance and Accountability Report
Published November 15, 2004

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Required Supplementary Information (Unaudited)

These materials are not audited.

1. Deferred Maintenance

Deferred maintenance is classified as not performed when it should have been or as scheduled but delayed to a future period. It is VA policy to ensure that medical equipment and critical facility equipment systems are maintained and managed in a safe and effective manner; therefore, deferred maintenance is not applicable to them. VA facilities reported their cost estimates for deferred maintenance by utilizing either the Condition Assessment Survey or the Total Life-Cycle Cost Method.

Deferred Maintenance as of September 30,
2004 2003
General PP&E $ 1,649 $ 1,433
Heritage Assets 34 30
Total Deferred Maintenance $ 1,683 $ 1,463

Balances with Other Federal Entities

Intragovernmental Assets as of September 30, 2004
Trading Partners Fund Balance with Treasury Investments Accounts Receivable Other Assets
Treasury $ 16,741 $ 13,643 $ - $ 8
DoD - Defense Agencies 64
All Other 68 114
Total Intragovernmental Assets $ 16,741 $ 13,643 $ 132 $ 122
Intragovernmental Liabilities as of September 30, 2004
Trading Partners Accounts Payable Debt Other
Treasury $ 46 $ 2,618 $ 1,311
Other 26 823
Total Intragovernmental Liabilities $ 72 $ 2,618 $ 2,134
Intragovernmental Earned Revenue and Related Cost (trade activity) Year Ended September 30, 2004
Trading Partner Earned Revenue
DoD - Defense Agencies $ 830
Health & Human Services 132
Justice 101
All Other 676
Total Earned Revenue $ 1,739
Related Cost $ 1,551
Intragovernmental Non-Exchange Revenue Year Ended September 30, 2004
Trading Partner Transfers-Out
Treasury $ 1,941
Schedule of Budgetary Activity Year Ended September 30, 2004
Total Budgetary Resources Obligations Incurred Spending Authority from Offsetting Collections and Adjustments Obligated Balance net, Oct 1 Obligated Balance net, Sept. 30 Total Outlays
VHA
0152 Medical Admin 4,123 4,086 23 13 656 3,420
0160 Medical Care 22,855 21,112 282 3,351 2,311 21,870
0161 Medical & Prosthetic Research 501 434 41 119 123 389
0162 Medical Facilities 3,201 3,142 11 - 658 2,473
All Other 1,268 907 289 636 827 427
Total 31,948 29,681 646 4,119 4,575 28,579
VBA
0102 Compensation, Pension, & Burial Benefits 31,020 29,959 - 2,267 2,441 29,785
0137 Readjustment Benefits 3,212 2,965 272 72 82 2,683
4025 Housing Credit Liquidating 60 32 100 (23) 2 (93)
4127 Direct Loan Financing 773 571 781 78 71 (203)
4129 Guaranteed Loan Financing 7,524 3,330 1,811 20 22 1,517
8132 National Service Life Insurance Fund 11,093 1,603 365 1,461 1,468 1,231
All Other 4,039 1,847 1,249 399 418 579
Total 57,721 40,307 4,578 4,274 4,504 35,499
NCA
0129 National Cemetery Adm. 149 144 - 25 33 136
All Other 38 34 - 36 31 39
Total 187 178 - 61 64 175
ADM
0151 General Operating Expenses 1,945 1,851 530 244 308 1,257
All Other 2,763 2,404 2,145 323 676 (94)
Total 4,708 4,255 2,675 567 984 1,163
Total of all Business Lines 94,564 74,421 7,899 9,021 10,127 65,416

Segment Information

Condensed Balance Sheet as of September 30
Supply Fund Enterprise Fund
2004 2003 2004 2003
Assets
Fund Balance with Treasury $ 921 $ 775 $ 96 $ 90
Accounts Receivable, Net 133 220 28 28
General Property, Plant and Equipment 4 5 22 24
Other Assets Including Inventory 27 25 6 8
Total Assets $ 1,085 $ 1,025 $ 152 $ 150
Liabilities and Net Position
Accounts Payable $ 67 $ 49 $ 4 $ 8
Deferred Revenues 338 438 - -
Other Liabilities 524 380 57 34
Total Liabilities 929 867 61 42
Cumulative Results of Operations 156 158 91 108
Total Liabilities and Net Position $ 1,085 $ 1,025 $ 152 $ 150
Condensed Net Cost Information
Total Program Costs $ 1,829 $ 1,375 $ 230 $ 188
Earned Revenues
Intra-Departmental (573) (448) (143) (185)
Other Federal Entities (1,225) (911) (66) (29)
Non-Federal (27) (36) - -
Total Earned Revenues $ (1,825) $ (1,395) $ (209) $ (214)
Net Program Costs $ 4 $ (20) $ 21 $ (26)

2. Enterprise Fund Services

VA was approved by OMB in May 1996 as one of six pilot franchise fund agencies operating within the Executive Branch of Government. VA's Franchise Fund was established as a revolving fund and began operations in FY 1997. By law, the business lines within the Fund can only sell to Federal entities on a fee-for-service basis.

The VA Franchise Fund supports VA's mission by supplying common administrative services to both VA and other Federal entities at competitive prices. Most of the Fund's customers are within VA; business from VA customers accounted for 68.55 percent of FY 2004 revenue. VHA is the largest customer for the following VA Enterprise Centers: Austin Automation Center, Financial Services Center, Law Enforcement Training Center, Security and Investigations Center and VA Records Center and Vault. VBA is the largest customer for the Debt Management Center.

The Fund accounts for its funds in six lines of business (VA Enterprise Centers) and one administrative organization. A brief description of each center is listed below:

Austin Automation Center (AAC)

Located in Austin, Texas, the AAC provides comprehensive e-government solutions to match the critical needs of VA and other Federal agency customers, from managing data to automating business processes. The AAC supports over 100 customer applications that provide mission-critical data for financial management, payroll, human resources, logistics, medical records, eligibility benefits, and supply functions. In addition, the AAC offers a full complement of technical solutions (information technology system hosting, application management, information assurance, customer business continuity, configuration management, data conversion and data interfacing, and acquisition services) to best meet customers' varied project needs.

Debt Management Center (DMC)

Located in St. Paul, Minnesota, the DMC is a centralized facility that provides direct collection of delinquent consumer debt owed to VA. The DMC also provides administrative support for a local Cooperative Administrative Support Unit.

Financial Services Center (FSC)

Located in Austin, Texas, the FSC provides VA and other government agencies with a full range of financial services, which include financial reports, accounting, invoice payments, credit card payments, medical claims payments, vendor file maintenance, discount subsistence purchases, payroll processing, travel payment processing, electronic commerce/electronic data interchange, automated document management, audit recovery, data matching and reconciliation, and consulting.

Law Enforcement Training Center (LETC)

Located in Little Rock, Arkansas, the LETC provides special training for police officers working in a health care or service-oriented environment. Emphasizing training in medical center patient situations, the LETC is available to approximately 2,400 law enforcement personnel working at VHA health care facilities and to Federal law enforcement professionals at other Federal agencies.

VA Records Center and Vault (VA RC&V)

Located in a subterranean, climate-controlled, secure facility in the Midwest, the VA RC&V provides records storage, protection, and retrieval services for official Federal records. The facility has been certified by the National Archives and Records Administration to operate as an agency records center. The VA RC&V can store records in any type of medium. This includes off-site storage of systems backups, as well as general, vital, and classified records on paper, film, and electronic media.

Security and Investigations Center (SIC)

Located in Washington, DC, the SIC provides quality and timely background investigations and adjudications for employees and contractors in sensitive positions for all VA entities nationwide. The SIC also issues and manages employee identification badges and provides fingerprint processing for VA employees and other Federal customers in the Washington, DC area.

Enterprise Fund Office (EFO)

The VA Enterprise Centers are supported by the EFO, which is responsible for overall fund operations including administering the financial resources of the Fund, coordinating all business activities, and serving as the liaison between the Enterprise Centers, their customers, and the Franchise Fund Board of Directors.

The Enterprise Fund allows VA and other government agency customers to conserve their budgetary resources through new innovative methods and/or efficiencies of scale with the same or lower unit costs, while improving the quality of services provided. As the Fund successfully expands its services to other Federal agencies, those agencies will derive similar benefits.

For more information, visit the VA Enterprise Centers online at www.va.gov/fund.

3. Supply Fund Services

Supply Fund functions include contracting for medical supplies, equipment, and services; stocking, repairing, and distributing supplies, medical equipment, and devices; providing forms, publications, and a full range of printing and reproduction services; training VA medical acquisition, supply, processing, and distribution personnel; and increasing small and disadvantaged business participation in VA contracts. The two largest customers for the Supply Fund are VA and DoD, but the Fund also has significant sales to other Federal agencies including the Department of Health and Human Services.