0201 Overview

This chapter establishes the Department of Veterans Affairs’ (VA) financial policies regarding intragovernmental and public liabilities. 

Key points covered in this chapter:

• Intragovernmental liabilities and public liabilities represent amounts owed to Federal and non-Federal entities and require separate reporting in accordance with OMB Circular A-136, Financial Reporting Requirements – Revised and the Department of Treasury’s (Treasury) Financial Manual (TFM) Volume 1, Part 2, Chapter 4700; 
• VA will distinguish between intragovernmental and public liabilities when recording accounting transactions in accordance with Federal Accounting Standards Advisory Board (FASAB) Statement of Federal Financial Accounting Standard (SFFAS) 1 Accounting for Selected Assets and Liabilities and SFFAS 5, Accounting for Liabilities of The Federal Government; and
• VA will report intragovernmental and public liabilities on the face of its consolidated balance sheet and disclose additional required information in the notes accompanying the financial statements.

0202 Revisions

See changelog.

0203 Definitions

Intragovernmental Liabilities – A probable future outflow or other sacrifice of resources as a result of a transaction or event between Federal entities.

Liability – A probable future outflow or other sacrifice of resources as a result of a transaction or event.

Public Liabilities – A probable future outflow or other sacrifice of resources as a result of a transaction or event with individuals and entities outside the U.S. Government.

0204 Roles and Responsibilities

Under Secretaries, Assistant Secretaries, Other Key Officials, and Financial Officials are responsible for ensuring compliance with the policies set forth in this chapter.

Office of Financial Reporting (OFR) is responsible for Department-wide accounting, reporting, and disclosure of liabilities per the Federal Accounting Standards Advisory Board (FASAB) and Office of Management and Budget (OMB).

Administration and Staff Office Chief Financial Officers (CFOs) and Fiscal Staff are primarily responsible for the appropriate recording and reporting of intragovernmental and public liabilities under their jurisdictions.

Financial Services Center (FSC) is responsible for providing support for the accounting and reporting of VA’s intragovernmental and public liabilities, including posting, and recording related intragovernmental and public liabilities transactions.

0205 Policies

020501 General Policies

1. VA will comply with guidance provided by OMB Circular A-136, SFFAS 1, SFFAS 5, and TFM Volume I Part 2 Chapter 4700, Federal Entity Reporting Requirements for the Financial Report of the United States Government, to record and report its intragovernmental and public liabilities.
2. VA will separate intragovernmental liabilities from public liabilities when recording transactions in VA’s accounting system.
3. VA will report intragovernmental and public liabilities separately on the face of the consolidated balance sheet and in the associated note disclosures.

020502 Accounting for Intragovernmental and Public Liabilities

1. FSC and Administration/Staff Office Fiscal Staff and CFOs will separate intragovernmental liabilities from public liabilities when recording accounting transactions. 
2. Vendor attributes will be utilized to identify transactions as either intragovernmental or public within VA’s accounting system to facilitate the separate reporting of these liabilities.
3. VA will maintain supporting documentation used to distinguish and compile intragovernmental and public liabilities in accordance with National Archives and Records Administration (NARA) statutes and make the documentation available for review by VA management, auditors, and others who may have oversight responsibilities.

020503 Reporting for Intragovernmental and Public Liabilities

1. OFR will report intragovernmental liabilities separately from claims against VA by non-Federal entities, Government-sponsored enterprises, and the Federal Reserve.
2. OFR will aggregate all liabilities within the same classification (e.g., public other liabilities) and report them on the face of the consolidated balance sheet in accordance with SFFAS 1, SFFAS 5, and OMB Circular A-136, Financial Reporting Requirements – Revised. For illustration, see VA’s Agency Financial Report, VA Agency Financial Report (AFR) – Office of Finance and OMB Circular A-136.
3. VA will present Inter-Departmental liabilities net of eliminations in the consolidated financial statements. 

0206 Authorities and References

• OMB Circular A-136, Financial Reporting Requirements – Revised
• SFFAS 1: Accounting for Selected Assets and Liabilities
• SFFAS 5: Accounting for Liabilities of the Federal Government
• TFM Volume I Supplements the U.S. Standard General Ledger
• TFM Volume I Part 2 Chapter 4700 Agency Reporting Requirements for the Financial Report of the United States Government

0207 Rescissions

VA Financial Policy, Volume VI, Chapter 2, Intra-Governmental vs. Governmental Liabilities dated, May 2019.

0208 Questions