Financial Accounting Manual for Federal Reserve Banks

Financial Accounting Manual For Federal Reserve Banks BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM Division of Reserve Bank Operations and Payment Systems Federal Reserve Bank Accounting Policy and Operations Section T ABLE O F C ONTENTS I NTRODUCTION R EVISION S ET C HAPTER 1 – B ALANCE S HEET 1-1 C HAPTER 2 – COLLATERAL AND CUSTODIES 2-1 C HAPTER 3 – P ROPERTY AND E QUIPMENT 3-1 C HAPTER 4 – C ENTRAL B ANK U NIQUE A CCOUNTING 4-1 C HAPTER 5 – F EDERAL R ESERVE N OTES 5-1 C HAPTER 6 – R EPORTING R EQUIREMENTS 6-1 C HAPTER 7 – [R ESERVED ] 7-1 C HAPTER 8 – S PECIAL T

OPICS 8-1 A PPENDIX A-1 FAM - 2013 Table of Contents INTRODUCTION This Financial Accounting Manual for Federal Reserve Banks (FAM) contains the 1 accounting standards that should be followed by the Federal Reserve Banks. The Board of Governors has delegated, within certain parameters, the authority to the director of the Division of Reserve Bank Operations and Payment Systems (RBOPS), to set accounting policy for the Reserve Banks and to define, amend, and interpret FAM as prescribed by FRAM 1-001 and 1-035. Periodic amendments to FAM are made primarily to codify changes in accounting policy that result from new transactions and other accounting developments. Although setting accounting policy and updating FAM are responsibilities of the RBOPS Accounting Policy and Operations Section, Reserve Banks’ accounting staffs also play significant consultative roles in the development of accounting policies included in this manual. FAM provides guidance to Reserve Banks that should result in uniform accounting policies conforming to the standards established. In some places, FAM provides examples of subsidiary accounts to facilitate an understanding of the scope of the broader balance sheet items. In these cases, unless otherwise noted, the maintenance of such accounts is discretionary with the Reserve Bank. Although FAM covers the receipt and disbursement of funds and specifies their location on the balance sheet, and is thus the controlling document on capitalization, rates of depreciation, correction of errors in expenses, entries to Profit and Loss, and so on, it does not provide guidance for cost accounting. The Federal Reserve Planning and Control System Manual (PACS Manual) sets rules for cost accounting. Federal Reserve Bank staff should consult with the RBOPS Accounting Policy and Operations Section on financial accounting questions or issues that are not specifically covered in this manual. The section’s email group is RBOPS FRB Accounting Policy and Operations. 1 Portions of the FASB Accounting Standards Codification®, are copyrighted by the Financial Accounting Foundation, 401 Merritt 7, Norwalk, CT 06856, and are reproduced with permission. In June 2009, the Financial Accounting Standards Board issued SFAS No. 168, The FASB Accounting Standards Codification, (“codification”), which has become the single source of U.S. GAAP. References to U.S. GAAP include both the codification as well as the legacy references. FAM - 2013 Introduction FINANCIAL ACCOUNTING MANUAL Revision Set 53 December 2012 Revisions are effective as of January 1, 2013. S UMMARY OF R EVISIONS Chapter 1 Paragraph .80 Accrual of Expenses Within...

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