Coins and Currency: How the Costs and Earnings Associated with Producing Coins and Currency Are Budgeted and Accounted For
Highlights
The government produces billions of coins and currency notes each year. Coins are made by the U.S. Mint and issued by the Treasury Department. Currency notes are made by the Bureau of Engraving and Printing and issued by the Federal Reserve System (Fed). The Fed buys coins from the Mint at face value but pays the Bureau only the costs of printing currency. Coins on the books of the Fed are assets that are issued by the Mint, and notes are liabilities of the Federal Reserve Banks. In recent years congressional hearings have highlighted the confusion over differences in the budgetary and accounting treatment of coins and currency. In addition, the Treasury Inspector General and others have reported problems with Mint and Bureau operations. GAO was asked to review (1) how the costs and earnings from coins and currency are budgeted and accounted for and (2) whether any operational problems at the Mint and Bureau need further action.
Recommendations
Recommendations for Executive Action
Agency Affected | Recommendation | Status |
---|---|---|
Department of the Treasury | To comply with the purpose of the reporting requirement of the Public Enterprise Fund, the Secretary of the Treasury should ensure that the Director of the Mint identifies whether amounts are being retained in excess of the estimated operating costs of the following year and, if so, explains how they will be used in reports to Congress each year. |
The Mint issues quarterly Public Enterprise Fund (PEF) reports to Congress. In response to GAO's report, the Mint added language identifying amounts retained in excess of estimated operating costs starting with the 1st Quarter FY 2004 Public Enterprise Fund report. In addition to quarterly PEF reports to Congress, the Mint also regularly issues detailed PEF financial statements and operating costs in its annual report and provides similar PEF statement and operating cost information in its annual budget submissions to Congress.
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