U.S. Department of State Fiscal Year 2020 Agency Financial Report

and Results Act (GPRA) of 1993 and the GPRA Modernization Act of 2010. The Department’s strategic goals and strategic priorities are defined in Management‘s Discussion and Analysis section of this report. Since the costs incurred by the Under Secretary for Manage- ment and the Secretariat are primarily support costs, these costs were distributed to the other Under Secretaries to show the full costs under the responsibility segments that have direct control over the Department’s programs. One exception within the Under Secretary for Management is the Bureau of Consular Affairs, which is responsible for the Achieving Consular Excellence program. As a result, these costs were not allocated and continue to be reported as the Under Secretary for Management. The Under Secretary for Management/Secretariat costs (except for the Bureau of Consular Affairs) were allocated to the other Department responsibility segments based on the percentage of total costs by organization for each program. The allocation of these costs to the other Under Secretaries and to the Bureau of Consular Affairs in 2020 and 2019 was as follows (dollars in millions) : Under Secretary 2020 2019 Political Affairs $ 16,040 $ 16,359 Management (Consular Affairs) 596 5,774 Public Diplomacy and Public Affairs 542 1,649 Arms Control, International Security Affairs 350 221 Civilian Security, Democracy and Human Rights 9,089 1,180 Economic Growth, Energy and Environment 85 49 Total $ 26,702 $ 25,232 Inter-Entity Costs and Imputed Financing: Full cost includes the costs of goods or services received from other Federal entities (referred to as inter-entity costs) regardless if the Department reimburses that entity. To measure the full cost of activities, SFFAS No. 4, Managerial Cost Accounting , and SFFAS No. 55, Amending Inter-entity Cost Provisions , require that total costs of programs include costs that are paid by other U.S. Government entities, if material. As provided by SFFAS No. 4, OMB issued a Memorandum in April 1998, entitled “Technical Guidance on the Implementation of Managerial Cost Accounting Standards for the Government.” In that Memorandum, OMB established that reporting entities should recognize inter-entity costs for (1) employees’ pension benefits; (2) health insurance, life insurance, and other benefits for retired employees; (3) other post-retirement benefits for retired, terminated and inactive employees, including severance payments, training and counseling, continued health care, and unemployment and workers’ compensation under the Federal Employees’ Compensation Act; and (4) payments made in litigation proceedings. The Department recognizes an imputed financing source on the Statement of Changes in Net Position for the value of inter-entity costs paid by other U.S. Government entities. This consists of all inter-entity amounts as reported below, except for the Federal Workers’ Compensation Benefits (FWCB). For FWCB, the Department recognizes its share of the change in the actuarial liability for FWCB as determined by the Department of Labor (DOL). The Department reimburses DOL for FWCB paid to current and former Department employees. Unreimbursed costs of goods and services other than those identified above are not included in our financial statements. The following inter-entity costs and imputed financing sources were recognized in the Statement of Net Cost and Statement of Changes in Net Position, for the years ended September 30, 2020 and 2019 (dollars in millions) : Inter-Entity Costs 2020 2019 Other Post-Employment Benefits: Civil Service Retirement Program $ 7 $ 62 Federal Employees Health Benefits Program 178 153 Federal Employees Group Life Insurance Program 1 1 Litigation funded by Treasury Judgment Fund — — Subtotal – Imputed Financing Source 186 216 Future Workers’ Compensation Benefits 17 17 Total Inter-Entity Costs $ 203 $ 233 Intra-departmental Eliminations: Intra-departmental eliminations of cost and revenue were recorded against the program that provided the service. Therefore, the full program cost was reported by leaving the reporting of cost with the program that received the service. 98 | U ni ted S tates D epartment of S tate 2020 A gency F inanci al R eport FINANCIAL SECTION | NOTES TO THE PRINCIPAL FINANCIAL STATEMENTS