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III.
Budget Results -
Third Quarter 2004
Executive Summary
- The
2004 Corporate Operating Budget provided $794 million in spending
authority for the Corporation for the first nine months of 2004.
Overall spending for the Corporation during that period was $705
million, which was 11 percent below the YTD budgeted amount. The
majority of this variance occurred in the contractor services portion
of both the Ongoing Operations and Receivership Funding components
of the budget.
- Approximately
$690 million was spent for Ongoing Operations, which was about
$48 million (7 percent) below the YTD budgeted
level.
- Approximately $15 million was spent for Receivership Funding,
which was about $41 million (73 percent) below the YTD budgeted
level.
- Spending on approved investment projects was $79 million,
which was about $16 million (17 percent) below estimated 2004 spending
on those projects through the end of the third quarter. A detailed
report on the status of those projects, except Virginia Square
Phase II, is provided separately to the Board by the Capital Investment
Review Committee.
- The budget tables within this report compare the actual expenditures to the approved Corporate Operating Budget by major expense category, budget component and total budget by division/office, for the nine months ending September 30, 2004.
- As
previously reported in the second quarter 2004 Budget Variance
Report, there was an increase in the authorized staff
for the Office of Public Affairs of one position
during the third quarter. This increase will not require a change
in the 2004 Corporate
Operating Budget.
Significant
Spending Variances by Major Expense Category1
Ongoing Operations
- Outside
Services-Personnel expenditures were $19.7 million, or 23 percent,
less than budgeted. This variance was largely attributable
to three factors: (a) a refund of $8.8 million in prepaid
charges for Government Litigation by the Department of Justice;
(b) under
spending of $5.0 million in the Division of Information
Resources Management on client projects and reductions in infrastructure
and administrative costs; and (c) contracting and course
delays/cancellations
of $3.1 million in Corporate University.
- Travel expenditures were $2.8 million, or 8 percent,
less than budgeted. The majority of this variance was in the
Division of Supervision and Consumer Protection due to higher
than anticipated leave taken in the summer, changes in travel
patterns, and travel funds budgeted for positions that are vacant.
Additionally, spending for reassignment travel has been lower
than anticipated.
- Building expenditures were $5.9 million, or 9 percent,
less than budgeted primarily due to delays in spending approximately
$3.7 million for capital improvements that will not be completed
in 2004 and $1.8 million for major repair projects which have
experienced contracting delays.
-
Equipment expenditures were $4.9 million, or 18 percent, less than
budgeted primarily due to a delay in expenditures for PC/LAN
software maintenance and equipment that are now expected to occur in
the fourth quarter.
Receivership Funding
- Salary & Compensation
expenditures for overtime were $2.5 million, or 88 percent, less
than budgeted
primarily due to less resolution activity than budgeted through
the third
quarter.
- Outside
Services-Personnel expenditures were $32.1 million, or 70 percent,
less than budgeted primarily due to
less resolution activity than budgeted through the third
quarter.
- Travel
expenditures were $3.5 million, or 86 percent, less than budgeted
primarily due to less resolution activity
than budgeted through the third quarter.
Significant
Spending Variances by Division/Office2
- The
Division of Resolutions and Receiverships spent $36.6 million,
or 37 percent, less than budgeted. This was largely the result
of contractual service expenses in the Receivership Funding
portion of its budget that were $28.9 million lower-than-budgeted
due to less resolution activity workload than budgeted through
the third quarter.
- The Division of Information
Resources Management spent $20.7 million, or 12 percent,
less than budgeted primarily due
to lower-than-budgeted spending for Equipment and Outside
Services – Personnel.
Equipment purchases for the infrastructure modernization
investment project and software maintenance and equipment expenditures
in the Ongoing Operations component of the budget have
occurred more slowly than anticipated. Contractor service reductions
and
contracting delays also contributed to this variance.
- The
Legal Division spent $6.2 million, or 8 percent,
less than budgeted. This was largely the result of
contractual services expenses in the Receivership Funding portion
of its budget that were $2.9 million lower-than-budgeted due
to
less
resolution activity than budgeted through the third
quarter. Approximately $2.4 million of the variance was attributable
to vacant positions that were budgeted but not filled.
- The
Corporate University spent $4.6 million, or 48 percent, less
than budgeted. This was largely the result of
contracting or course delays/cancellations and slower hiring to fill vacancies.
- The
Division of Insurance and Research spent $3.8 million, or 14
percent, less than budgeted. This was largely
the result of vacant positions that are currently in the process of being
filled and contractor costs expected to be incurred
later in the year than originally planned.
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1Significant Spending Variances for the nine months ending September 30, 2004, are defined as those that exceed the YTD budget by $1 million and represent more than 2 percent of the budget, or those that are under the YTD budget by $2 million and represent more than 4 percent of the budget.
2Information
on division/office variances reflects variances in both the Corporate
Operating and Investment portions of the budget.
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