H.R. 3332House112th Congress (2011-2013)In Committee

Truth in Government Accounting Act of 2011

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HouseIntro Referral Latest Action

Referred to the Committee on the Budget, and in addition to the Committee on Oversight and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

Budget Committee

November 3, 2011

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HouseIntro Referral

Introduced in House

November 3, 2011

HouseIntro Referral

Sponsor introductory remarks on measure. (CR H7260-7261)

November 3, 2011

HouseIntro Referral

Budget Committee

November 3, 2011

Floor Debate

1 member

What members said about H.R. 3332 on the floor

1 Republican

Rep. Robert J. DoldR-IL-10 · Nov 3, 2011

Mr. Speaker, the American taxpayer is facing a struggling economy, skyrocketing debt, and political partisanship here in Washington. While every American family must balance the budget, the Federal…

Additionally, publicly traded companies are required to provide financial statements for their shareholders, whereas the government is not held accountable to the American taxpayer. That is why Representative Mike Quigley and I are introducing bipartisan legislation that would require the Federal Government to prepare and publish online periodic financial statements that are independently audited and that accurately reflect the government's true financial condition.

In the short time that I've been in Congress, I've focused my efforts on creating an environment that fosters job creation and gets our economy back on track. Part of that effort involves America's fiscal house getting in order, and that is why I've worked to curb out-of- control government spending.

Moving forward, I believe that we must also reform the way our Federal accounting methods are conducted to make the budget process more transparent and accessible to every American so that they, as taxpayers, can truly know how their money is being spent and what our government's true liabilities are. That is why I'm introducing the bipartisan Truth in Government Accounting Act, H.R. 3332.

To protect private-sector shareholders, the Federal Government requires each publicly traded company to file periodic GAAP financial statements that are independently audited and that accurately reflect the company's true financial condition. By contrast, the Federal Government's own accounting practices substantially conceal and confuse the Federal Government's true financial condition, especially with respect to long-term unfunded liabilities and year-over-year spending.

To protect taxpayers as much as the private-sector shareholders, the Federal Government should similarly require each Federal agency to file periodic GAAP financial statements that are independently audited and that accurately reflect the agency's true financial condition. The Truth in Government Accounting Act would require the Federal Government to do so, to make the resulting Federal Government financial statements easily available online, and to require zero-baseline budgeting.

This bill will require all Federal agencies to provide three quarterly and one annual consolidated financial statement, just as the private sector must do, using the fair-value accrual accounting method on all their assets and liabilities, including unfunded entitlement liabilities. These statements will be audited by a single entity, the Government Accountability Office, an independent, nonpartisan agency that reports to the Congress. These audited statements will be put online, in terms of a searchable Web site for all Americans to use and to see easily.

As incredible as it may seem, there's not a simple way for the American public to easily view our national budget with all of its liabilities, current and long term. What exists now is a system where information is scattered between Federal agency and government office Web sites. Our bill creates a simple and accessible Web site that can be a one-stop shop for all information related to our Federal budget, based off of Web sites that we know currently exist, like recovery.gov.

Americans deserve a transparent way to see where their tax dollars go and what they are on the hook for in the future. The bill will require the Congressional Budget Office to use current year spending as a baseline for estimating future mandatory and discretionary changes to determine whether the future legislation would increase or decrease Federal spending. It will be measured against current year spending and not against previously anticipated and hypothetical future year spending.

The American people deserve an open and transparent budgeting process, and the Truth in Government Accounting Act provides just that. By requiring

agencies to provide quarterly financial statements, auditing those financial statements and putting that information on a comprehensive Web site, as well as implementing the zero-based budgeting, we will greatly improve our Federal budget practice and enhance the public's ability to know how their tax dollars are being spent.

We expect and demand that companies conduct their business in a transparent manner. We should expect and demand no less of our Federal Government.

I want to urge my colleagues to cosponsor this legislation. The American taxpayers deserve true accounting of how their money is being spent.

Bill Text

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Introduced in HouseIssued November 3, 2011

112th CONGRESS

1st Session

H. R. 3332

IN THE HOUSE OF REPRESENTATIVES

November 3, 2011

Mr. Dold (for himself and Mr. Quigley) introduced the following bill; which was referred to the Committee on the Budget, and in addition to the Committee on Oversight and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To require each agency to prepare and make public quarterly and annual consolidated financial statements using the fair-value accrual accounting method, to require the Congressional Budget Office to use current-year spending as the baseline for estimating future mandatory and discretionary changes, and for other purposes.

Short title

This Act may be cited as the Truth in Government Accounting Act of 2011.

Financial statements

(a)

In general

With respect to a fiscal year, the head of each agency shall prepare and submit to the Comptroller General a quarterly consolidated financial statement for each of the first three quarters of such fiscal year and an annual consolidated financial statement for such fiscal year as a whole for such agency based on the fair-value accrual accounting method. Such statement shall include for such agency—

(1)

all future certain liabilities, including all contingent liabilities that can be reasonably estimated;

(2)

all liabilities that may require future taxes for present liabilities; and

(3)

other expenditures and liabilities.

(b)

Submission deadlines

(1)

Quarterly financial statements

Each quarterly financial statement required by subsection (a) shall be submitted not later than 90 days after the end of the fiscal quarter.

(2)

Annual financial statements

Each annual financial statement required by subsection (a) shall be submitted not later than 180 days after the end of the fiscal year.

(c)

Generally accepted accounting principles and footnote disclosures

Each statement described under subsection (a) shall be prepared in accordance with generally accepted accounting principles applied on a consistent basis and include footnote disclosures.

(d)

Web site

Not later than 10 days after the submission of any financial statements to the Comptroller General under subsection (a), the Comptroller General shall publish all such statements on a single, searchable, downloadable, up-to-date Web site accessible by the public, that allows a user to search accounts and associated activities by an agency and by each office, bureau, and activity of an agency.

(e)

Agency defined

In this section, the term agency has the meaning given that term in section 101 of title 31, United States Code.

(f)

Auditing of financial statements

Subchapter II of chapter 7 of title 31, United States Code, is amended by adding at the end the following new section:

721.

Audit of agency consolidated financial statements

(a)

In general

Each year, the Comptroller General shall, in accordance with generally accepted auditing standards, audit the consolidated financial statements prepared by each agency for each fiscal year under section 2(a) of the Truth in Government Accounting Act of 2011.

(b)

Records and property

To carry out this section, the head of each agency shall provide the Comptroller General with all records and property of or used by each such agency in the preparation of the consolidated financial statements under section 2(a) of the Truth in Government Accounting Act of 2011 that the Comptroller General determines to be statistically meaningful. The Comptroller General shall give the head of each agency a current list of officers and employees to whom, with proper identification, records and property may be made available, and who may make notes or copies necessary to carry out the audit. The head of each agency shall provide the Comptroller General with suitable facilities to carry out the audit.

Preparation of the budget

(a)

The President

Section 1105(a) of title 31, United States Code, is amended—

(1)

by redesignating the second paragraph (37) as paragraph (39); and

(2)

by adding at the end the following new paragraph:

(40)

A summary of how the use of accrual accounting procedures would affect the estimated expenditures, appropriations, and receipts of the Government in the fiscal year for which the budget is submitted.

(b)

Office of Management and Budget

The Director of the Office of Management and Budget shall prepare all of the budgets submitted to the President according to both accrual accounting procedures and the cash basis accounting method.

Zero-baseline budgeting

(a)

Changes in the baseline

(1)

Section 257(c) of the Balanced Budget and Emergency Deficit Control Act of 1985 is amended—

(A)

in the second sentence of paragraph (1), by striking everything that follows current year, and inserting excluding resources designated as an emergency requirement and any resources provided in supplemental appropriation laws.;

(B)

by striking paragraphs (2), (3), (4), and (5);

(C)

by redesignating paragraph (6) as paragraph (2); and

(D)

by inserting after paragraph (2) the following new paragraph:

(3)

No adjustment for inflation

No adjustment shall be made for inflation or for any other factor.

(2)

Section 257(b) of the Balanced Budget and Emergency Deficit Control Act of 1985 is amended by adding at the end the following new paragraph:

(4)

No adjustment for inflation

No adjustment shall be made for inflation or for any other factor for any direct spending program.

(b)

Extension

The second sentence of section 275(b) of the Balanced Budget and Emergency Deficit Control Act of 1985 is amended by inserting other than subsections (a) through (d) of section 257 after title.

Effective date

This Act, and the amendments made by this Act, shall take effect on October 1, 2012.