oversight

Financial Review: Panama Canal Commission's 1989 Financial Statements

Published by the Government Accountability Office on 1990-09-21.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

-.-


 FINANCIAL REVIEW
 Panama Canal
 Commission’s 1989
 Financial Statements




                  142264
I   ~--   -   ----   --_-   ---.....   -.--._“-.-
                     United States
                     General Accounting Office
                     Washington, D.C. 20548

                     Comptroller   General
                     of the United States

                     B-l 14839

                     September 2 1,lQQO

                     To the President of the Senate and the
                     Speaker of the House of Representatives

                     This report presents the results of our limited review of the Panama
                     Canal Commission’s financial statements for the year ended Sep-
                     tember 30, 1989. Due to security concerns, we were unable to travel to
                     the Republic of Panama to conduct the 1989 financial audit of the Com-
                     mission, as required by 22 USC. 3723(a). Instead, we conducted a lim-
                     ited review of the Commission’s financial statements for the year ended
                     September 30, 1989. This review was substantially less in scope than an
                     audit.

                     Our review did not disclose any material modifications that should be
                     made in the format of the accompanying financial statements in order
                     for them to be presented in conformity with generally accepted
                     accounting principles. However, since we were unable to conduct a
                     financial audit, we cannot be assured that the financial statements are
                     free of material misstatements. We also were unable to report on the
                     Commission’s internal control structure and on its compliance with laws
                     and regulations.

                     In conducting our limited review, we primarily analyzed the financial
                     statements for unusual fluctuations and other changes from the prior
                     years and obtained explanations from Commission personnel by tele-
                     phone. We also compiled, for additional analysis, unaudited schedules of
                     treaty-related costs and savings that are required by 22 USC. 3723(b).
                     We accomplished this compilation by obtaining the amounts from the
                     federal agencies incurring such costs and savings.

                     The Commission is a federal agency that was established on October 1,
                     1979, to carry out the responsibilities of the United States with respect
                     to the Panama Canal Treaty of 1977. The Commission will operate the
                     canal until the treaty terminates on December 31, 1999, when the
                     Republic of Panama will assume full responsibility for the canal.

                     Our review noted the following item of interest.


                     In July 1984, the Commission established, without regulatory approval,
Floating Equipment   a reserve for $2.6 million to provide for the future repairs of cranes,
Reserve              dredges, tugs, and other floating equipment. As a result, we qualified


                     Page 1                                GAO/AFMD-90-106   Panama Canal Commission
B-114339




our fiscal years 1984 to 1987 opinions on the Commission’s financial
statements, and would have qualified the fiscal year 1988 statements,
had we performed an audit to opine on the statements. In August 1989,
the President of the United States, as the regulator, approved the Com-
mission’s request for a toll rate increase, effective October 1, 1989. The
Commission’s request included the floating equipment reserve and,
therefore, this matter is resolved.

As required by the Panama Canal Act of 1979, we are sending copies of
this report to the President of the United States and the Secretary of the
Treasury. Also, we are sending copies to the Director of the Office of
Management and Budget; the Secretaries of State, Defense, and the
Army; the Chairman of the Board of Directors of the Panama Canal
Commission; and the Acting Administrator of the Panama Canal
Commission.




Acting Comptroller General
of the United States




Page 2                                GAO/AF’MD-90-106   Panama Canal commission
Page 8   GA0/AFMB90.106   Panama Canal Commiseion
(hdents


Letter                                                                                                   1

Financial Statements                                                                                 6
(Unaudited)            Statement of Financial Position
                       Statement of Operations
                                                                                                     6
                                                                                                     8
                       Statement of Changes in the Investment of the United                         10
                            States Government
                       Statement of Cash Flows                                                      12
                       Statement of Status of Appropriations                                        14
                       Notes to Financial Statements                                                16

Supplementary                                                                                       22
Information            Schedules of Treaty-Related Costs
                       Schedule of Property, Plant, and Equipment
                                                                                                    22
                                                                                                    26
(Unaudited)




                       Page 4                              GAO/AF’MD-90-105   Panama CanIll c?mnmh3ion
Page 5   GAO/AFMD-90-105   Panama Canal Commission
Financial Statements


Statement of Financial Position (Unaudited)


                                                                           September           30,     1989 and 1988



                   PROPERTT, PLANT AND EQUIPMENT:
                     At cost (Note lc) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                       $969,630,333       $936,111,054
                     Less accumulated      depreciation          and valuation
                      allowances    (Notes    le and 2).........................                                                      484.884.187        464.872.854

                                                                                                                                      484.746.146




                   CURRENT ASSETS:
                     Cash:
                       U.S. Treasury   account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                             93,226,977        138,872,443
                       Cash in cosnnercial    banks and on hand...............                                                          6,077,070          5,800,906
                       Postal,  other   trust  funds and cash in transit......




                      Accounts         receivable          ..................................                                         11.371.71714.894.155




                      Inventories,              less allowance             for obsolete  and excess
                        inventory          of     $400,000  each           year (Note lg)...........                                   37.723.XB              36.928.949


                      Other      current         assets     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..a                379.561                382919



                   OTHER ASSETS :
                     Deferred    charges:
                       Cost of early            retirement           benefits           (Note lh)........                             151,440,000            166,584,OOO
                       Cost of work injuries                    compensation             benefits
                         (Notes lm and 5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                           78,871,578            79,126,504
                       Retirement        benefits           to certain            former        employees
                         of predecessor             agencies          (Note lh).................                                         6,186,OOO             6.746.000
                        Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                   492&e
                                                                                                                                      236.989.727            252.456.501

                       Unrecovered costs due from subsequent                       revenues
                        (Notes lb and 4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .                         9.728&l               2.4Qm

                                                                                                                                      246.717.888            254.865sl.U


                    TOTAL ASSETS...............                       ............................                                   $882.780.319 $925.424.630
                    The accompanying               notes      are     an integral             part     of     this      statement.




                                                              Page 6                                                                      GAO/AFMD-90-106         Panama Canal Commission
                                               Financial        Statemente




CAPITAL:
  Investment        of the United         States          Government:
     Interest-bearing         (10.219% and 10.379%,
       respectively)       (Note 6) ............................                                                  $147,893,234        $102,773,553
     Non-interest-bearing          ...............................                                                 325.398.45Q         371.024.286

                                                                                                                                       473.797&9
CURRWT LIABILITIES:
  Accounts     payable:
    U.S. Government                 agencies ...........................                                              4,146,044            4,245,938
    Government          of Panama ...............................                                                     8,062,973            8,475,439
    Other ..............................................
                                                                                                                   ILiIEkE             ???z!E%
   Accrued    liabilities:
     Employees . leave ...................................                                                          46,058,824            44,033,669
     Salaries       and wages .................................                                                      8,086,607             7,139,405
     Cost of early              retirement                benefits              (Note lh) ........                  15,144,ooo            15,144,ooo
     Cost of work injuries                         compensation                  benefits
       (Notes     lm and 5) ..................................                                                        6,536,705            7,033,467
     Retirement         benefits              to certain                former       employees
       of predecessor               agencies              (Note lh) .................                                   790,000              844,000
     Employees ’ repatriation                         ............................                                      857,000              687,000
     Marine accident                claims .............................                                            15,387,115            139822,471
     Other ..............................................
                                                                                                                   IT!iskE            IiiczsE
   Other current            liabilities:
     Advances        for capital                 - unexpended                (Note   ld) ........                   10,336,538            14,332,082
      Other ..............................................
                                                                                                                   iiI%EE             IikE


DEFERRED CREDIT:
  Advances  for capital               being amortized
   (Note Id) ...........................................                                                            46.898a               40.941.046

LONG-TERM LIABILITIES          AND RESERVES:
  Cost of early     retirement         benefits              (Note lh) ..........                                  136,296,OOO         151,440,000
  Cost of work injuries          compensation                 benefits
    (Notes lm and 5) ....................................                                                           72,334,873            72,093,037
  Retirement    benefits       to certain             former employees
   of predecessor       agencies        (Note lh) ...................                                                 5,396,OOO            5,902,ooo
  Employees’    repatriation       ..............................                                                     6,875,OOO            6,053,OOO
  Lock overhauls       (Note li) .............................                                                           371,865              211,633
  Marine accidents         (Notes lj and 7) ....................                                                      7,000,000           17,683,380
  Casualty   losses      (Note lj) ............................                                                          993,865              941,882
  Floating   equipment       overhauls           (Note lk) ................                                                                l.Sa&LQe

                                                                                                                             00.786

TOTAL CAPITAL AND LIABILITIES                           ..........................                                $882.780.319        $92~.42426;1P

The accompanying                notes      are     an integral                part   of   this       statement.




                                               Page 7                                                                   GAO/AFMD-90-105      Panama Canal Commission
                                                                                                                                                                                        ,
                                                                  Financial         Statements




Statement of Operations (Unaudited)

                                                           Fiscal        Years        Ended September                 30,     1989 and 1988



                 OPERATING RPXSNUES:
                   Tolls revenue ..........................................                                                           $329,765,627      $339,319,326
                   Other revenues .........................................                                                            106.034.363       11o.089.650

                        Total       operating            revenues        .............................                                 435.799.990       449.408.986


                 OPERATING EXPSNSES:
                   Payments to the Government                          of Panama:
                     Public  services           ......................................                                                  10,000,000        10,000,000
                     Fixed annuity ........................................                                                             10,000,000        10,000,000
                     Tonnage ..............................................                                                            59.819.225        59.635.398

                                                                                                                                        79,819,225        79,635,398

                    Maintenance           of channels                  and harbors ....................                                 36,506,857        42,258,524
                    Navigation          service            and control                .........................                         79,796,645        77,384,665
                    Locks operation               ........................................                                              48,988,652        47,709,751
                    General      repair,            engineering                 and maintenance                   services    ...       22,004,849        25,071,192
                    Supply and logistics                      ...................................                                       20,488,618        21,030,820
                    Utilities      ..............................................                                                       30,016,519        31,895,242
                    Sousing     operations               .....................................                                            5,418,893         5,553,796
                    General     and administrative                          .............................                               76,587,612        73,107.100
                    Interest       on interest-bearing                             investment                (Note 6) .......           13.878.234        11,250,757
                    Other ..................................................                                                           29.613.382        36.329.982

                        Total       operating           expenses         .............................                                 443.119.486       451.227.227


                 NET OPERATING REVWUE (LOSS)                               (Notes          lb and 4) ............                   $ (7.319.496)       $ (1.818.241)




                 The accompanying                 notes       are     an integral                 part   of    this      statement.




                                                                Page 8                                                                      GAO/AFMD-SO-10s   Panama Canal Commission
Flnmdel   Statements




Page 9                 GAO/AFMD-90-106   Panama canal Commbsion
                                                                                             Financial            Stdements




Statement of Changes in the Investment of the United States Government (Unaudited)

                                                                                                              Flacal        Year   Ended    September       30,   1989


                                                                                                                                                            Emergency                Operatin                capita1
                                                                                                                                                                  Fund                 Funds                  Fund*                TOUil

          INVFdl7iLNT      AI OCTOBER 1, lPSS...............                                                                                                             -       $              -        $             -       $473.797.639
                                                                                                       f102,773,553                $371,024,286         $
             Appropriation      by tha ConSrw           Zor IY 1988.

                                                                                                        102.773.553                 371.024.286                                                                                 473.797.839

            lundr       tranaferrmd              by Public      Iav 100-203,
              df~crlv~           Jwu~mry 1, 19111:
                Transferrad            from .m.r#.ncy fund.........
                Irmmfarred             fra          operaKin      fundm........
                Transfarrad            from capltal           fund#..........
                Adjuntmant for inmre8t                       accrued
                  10/l/79-12/3llS5.......................




          INCBEASCS IN INYCSIXENT:
            Plant r*~ctlv~tlon~.......................
            ?rIor       y..r      r~c~lpt#          daponltad           into
              U.8. 1rmmn-y............................                                                                                     420.341                                                                                    420.341
            Crp~ndltur~~                   fra          capital      l ppropriat1o.s..
            C&ditur.a                      from op;r.tInC-ipp;opri.tiom
            Cxpmdfturss                    from Panamm Cmal                   Revolvin9
              Fund.....................................                                                 486.757.576                (486.757,576)
            Rarament               to the Cmaral                    Fund of the
              U.S. ?r*am~ry for FY 1980 l pproprlatlon..
            Paymmt           of intarwt                     l eerwd
              1011/79-12131lS,.........................
            lunda       covered               into        the U.S. Ir~a~ury......
            Property            trmwfarred                    from other U.S.
              cov*rNent                 l g*ncl*r......................
            Uor~eov~r~d                  eo.t.          due from l ubaequant
              r.“.““..             (Norma lb and 4)................                                                           v        7,319.496                                                                                   7,319,496

                                                                                                        466.757,576                (479.017.739)                                                                                   7.739.837

          DECWSLS IN INVESTNENT:
             Iollm    and othar       recalpts               deposited
               Into   PCC Fund............................
             Toll*    and other       receipta               dapoaited
              Into Rwolvln9           Fund . . . . . . . . . . . . . . . . . . . . .                    441.308.274                (b41,386.274)
             Dua U.S. Treuury               for undwomitad             rmceiptm                                                           676.875                                                                                     676,875
             Proparty     transf.irad                  to  th;
              cov~roD8nt            of Pmama.....................
             ?roparty    tranrfmrred         to other           U.S.
              cov~rnm*nt      l ~*ncI*r......................                                                    249,621                                                                                                              249,621
             Uwarrent.d       appropriated           fundn............
             Nat lomr (Wotw          lb and I).................                                                                        7.319.496                                                                                   7.319.496

                                                                                                        441.637.695                (433.391.903)                                                                                   8.245.992

          IN9ESIXLNT           AT SCFTMBER               30,     19119............                     $147.193.234                L325.398.450         t                    -   1                  -t                     -   $473.291,684



                                                                                                          (Not*        6)


          llm l ccapanylnC                 not..       .r.     .n    Intqral              p.rt    of   this      .t.t.m.nt.




                                                                                                 Page10                                                                                   GAO/AJ?MD-QMOSPanama                         CendC4mmif4sion
                                                                                         Inveatad        Capital
                                                                                  lnter*mt-               Non-lnter~~t           Emcrpncy          Opratin~                   capita1
                                                                                    I*Wh~                      l3wlrin.q             Fund            Funds                     Fund8               Total

1Nvcs1mNT       AI OcmeLn   1. 1987 . . . . ..*........                          $ 64,711.276             $287,336,291       $ lO.ODO,OOD         $ 55,658.038           $ 26.086,026          $443,791,631
  Appropriatlan      by the ConSraw       for FY 1908.                                                                                        -    42D.5&3,000             33,715,ooo           454.303,ODO

                                                                                   64.711.276               287.336.291          10.000.000        476.246.030               59,801,026         898,094,631

   ?undm trmvfarrad                 by Public        Law 100-203,
    ~ff~ctlw        Jmmry              1, 1988:
      Transfarr.d         from w.r).ncy               fund.........                                  -       10,000,000       (10,000,000)
      lrmmferred          frm          op~r~tinS      funds........                                         202,316,621                           (202,211,39i)                                       105,231
      Trmmfwred           from c&La1               fundm..........                                           54,060,961                                                   (54.060.961)
      Mjurtmnr          for interest             accrued
        10/l/79-12131/65.......................                                    61.653.129               161.653.129)

                                                                                   61,653,129               204.724,453       (10,000.000)        J202.211.390)           ~54.060.961,                105,231

                                                                                  126.364.405               492,060,744                            274.034.640                5.740.065         898.199.662

nbx&Ases          IN INvESftlEKL:
   Phnr      r*4etlv~tlon#.......................                                                                                                                                                                   -
   Prior     y..r      reeelptm                depo8ited      Info
     U.S. fr..*"ry............................                                                                 l,OSS,117                                                                           1,088,117
   Lrpmdltur*9              from c*pltal                l ppropriltlon~..            5.740.06s                                                                               (5,740,06;)
   Cxpeadituraa              from OperatlnS                l pproprl~tlons        109.394.660                                                     (109,394,668)
   Lxpmdlturm               from Panama Cm41 Rwolvin6
     ?und . . . ..a.*..........*.......*..........                                317,977,051             (317,977,051)
   n.p.ym.nt        to the 0mwal                       Fund of rha
                                                                                   05,582.579               (85.582,579)

    lblll79.12/31/85            .........................                                                   (61.653.129)                                                                        (61,653,129)
   Punda covered           late      tha U.S. Trmsury               ......        (S5.582.579)                                                                                                  (85.582.579)
   Proparty       trm,ferred               fro-          other U.S.
    Cowrnwnt           l ~~ncI*r..............*.......
   Uarwxwmrad          ce.t.      due from submqumt
    C.V.IW.I        (Nom        lb and 4)................                                                      1.818,241                                                                           1.818,241

                                                                                  433,111.784             (662.306,401)                           QO9,394,668)               (5,740,065)       1144,329,350)

DECREASES IN INVESTNZNT:
  Tolla     and other        receipts               deposited
   lnro     PCC Fund............................                                  112,765,084                                                                                                   112,765,084
  Toll*     .nd ocher rmceiptn                      deposIted
   Into        RWO1Vh6       Fund . ..I.................                          343.508.525              (343,508.525)
  Due U.S. heawry                  for undepoeitcd                receipta                                        420,341                                                                             020,341
  Property      transfarred                to the
   corwnunt           of Panama.....................                                        51,992                                                                                                         51.992
  Property      tranrfrrred                tq orhar         U.S.
   cov*rnmwit         qwlci**......................                                        377,035                                                                                                    377,035
  Unurrrantad         l pproprlared                 funds m...........                                                                                164,639,9.90                              164.639.980
  Nmt 108# (Noten            lb and C).................                                                         1,.918,241                                                                         1.818,241

                                                                                  456,702.636             1341.269.943)                               164.639.980                               280,072,673

INvCSTlmTI          AT SCPTENeER             30,     1988............            $102,773,553              $371,024,286      $                -   $                  -   $                 -   $473,797,839



                                                                                   (t&t*       6)




                                                                             Page 11                                                                      GAO/AFMD-W105                    Panama Canal Commission
                                                                      Financial        Statements




Statement of Cash Flows (Unaudited)

                                                            Fiscal         Years       Ended September                      30,       1989 and 1988

                                                                                INCREASE (DECREASE) IN CASH

                Cash Flows            from       Operating            Activities:

                   Cash received:
                     Tolls ................................................                                                                 $ 329,X5,627             $ 339,319,326
                     Other collections                 ....................................                                                   109,934,767              120,011,727
                     Decreaee/(increase)                      in receivables                   ...................                               1.687.880              (3.057.444)
                        Total     cash received                  ................................                                            441.388.274-

                   Cash disbursed:
                     Operating      expenditures    ...............................                                                           (429,739,182)           (463,389,231)
                     (Increase)/decreare         in inventories                 ...................                                                 (794,260)            (1,789,780)
                     (Dacrease)lincreaes         in liabilities                 ...................                                          (20.964.032)                59.367.762
                        Total    cash disbursed     ...............................                                                          L451.497.474)            W)
                           Net cash from operations               .........................                                                  AO.lOSJQQ)                  50.462&Q

                   Other adjustments:
                      Cash from Panama Canal Commission               Fund ...............                                                                             289,663,021
                      Restoration    of funds previously         withdrawn          ............                                                                            105,231
                      Operating   revenues   deposited     into
                       Panama Canal Commission        Fund ........................
                           Net operating    cash received         from Treasury ........                                                                         -    !i!kE?E’

                Net     cash      provided            by/(usad           in)     operating            activities             ......          -1                       222.465.528

                Cash Flows            from       Extraordinary                 Activities:

                   Payment of interest  on net direct    investment        (Note                                                   9) . .                               (61,653,129)
                   Repayment of 1980 appropriation    (Note 9) ...............                                                                                   -    (85.582.579)

                Net     cash      provided            by/(used          in)      extraordinary                 activities              ..                        -    (147.235.708)

                Cash Flows from Capital        Activities:
                  Capital     expenditures ...................................                                                                 (39,584,851)             (27,069,345)
                  Increase/(decrease)      in liabilities                   .....................                                            4.324.748                (231.190)

                Net     cash      provided            by/(used           in)     capital          activities            ........             (35.260.103)             (27.300.535)

                Cash Flows from Postal                and Trust              Funds:
                  Postal   funds ...........................................                                                                            (5,279)                  (6,630)
                  Trust  funds ............................................                                                                  -12.048

                Net cash provided       by/fused          in) postal               and
                 trust  fund activities        ...................................                                                           94.9635

                Net     (decrease)/increase                       in cash ..........................                                              (45,274,340)           52,934,703

                Cash,      beginning             of    year ..................................                                                                           94.181.435

                Cash,      end of         year ........................................                                                     $m                       $ 147.116&B

                                                                                                                                                                        (Note     8)
                The a&ompanying                    notes        are     an integral               part       of      this      statement.




                                                                      Page 12                                                                           GAO/AFMD-90.106          Penmne Canal Commission
                                                   FInancM              Statements




         RECONCILIATION                 OF NET REVENIJE (LOSS)                              TO NET CASE PROVIDED BY OPERATING ACTIVITIES



Net     revanue         (loss)       ......................................                                                s-)$11.818.241)

Adjustments   to reconcile                         net revenue                     (loss)        to net            cash
 provided   by operating                        activities:

  Adjustments               not     requiring               outlay            of      cash:

        Depreciation      ........................................                                                                22,963,018            21,352,682
        Provision      for lock overhauls                       ........................                                           6,353,OOO              4,387,OOO
        Provision      for casualty                 losses .......................                                                (5,642,936)             2,901,952
        Provision      for floating                equipment               overhauls                  ..........                   4,934,ooo              4,019,000
        Advances     for capital               (Note 8) .......................                                                    4,451,618              8.474.087
        Other (Note 8) ......................................                                                                                        (29.829.760)
            Total    adjustments              not requiring                     outlay                of    cash ...        IIziskz11.304.961

  Adjustments               requiring             outlay           of     cash:

        Lock overhauls    expenditures       .........................                                                             (6,192,767)           (5,699,523)
        Casualty   losses  expenditures        ........................                                                            (4,988,460)           (5,671,166)
        Floating  equipment    overhauls         expenditures                                      ...........                     (4.889a)              (3.678.624)
            Total adjustments      requiring          outlay           of                          cash .......                  (16.070.753)          (15.Q49.313)

Other       adjustments:

        Cash from Panama Canal Connnfssion                     Fund ..............                                                                     289,663,021
        Restoration      of funds previously              withdrawn        ...........                                                                      105,231
        Operating     revenues     deposited        into
         Panama Canal Conmission            Fund.....................;.
            Total   other    adjustments     ..........................                                                                          -   G'

Changes         in operating               assets          and liabilities:

        Decrease/(increase)                   in receivables         ..................                                          1,687,880                (3,057,444)
        (Increeee)/decrease                   in inventories         ..................                                            (794,260)              (1,789,780)
        (Increaee)/decrease                   in other       assets       (Note 8) ........                                        (427,609)               1,504,415
        (Decrease)/increase                   in liabilities           (Note 8) .........                                     (70.964.032)                59367.762
             Total   changes               in operating       assets       and liabilities                                  120.498,)                     56.024.953

              Total       adjustments              ................................                                         (2.789.704j229.283.769

Net     cash      provided          by/(used             in)       operating                activities             .....   $llO.109.20Q)             $ 227.465.528

                                                                                                                                                          (Note     8)




The accompanying                  notes         are      an integral                   part      of      this       statement.




                                                 Page 13                                                                               GAO/AF’MD9MO5              Panama Canal Ckmunission
                                                               Financial                 Statamenta




%tatOment of Statu8 of Appropriations               (Unaudited)

                                                    Fiscal           Years                Ended September                                           30,             1989 and 1988


                SOURCE OF APPROPRIATICNSr

                  Operating        funds:

                     Current      year      operating   appropriation................                                                                                       $        -    $407,088,000
                     Appropriation           Public   Law 99-195
                      (indefinite           - funded interest).....................
                                                                                                                                                                                     -e

                     Restoration          of     funds       previously                           withdrawn...........                                                                             105 &4J,

                     Obligated        operating           funds              brought                      forward:

                        Fiscal       year 1980 . . . . .         .   .   .   .   .   .   ..   .   .   .   .   .   .   .   .   ..   .   .   ..   .   .   .   .   .   .   .                       311,229
                        Fiscal       years - Merged              .   .   .   .   .   .   ..   .   .   .   .   .   .   .   .   ..   .   .   ..   .   .   .   .   .   .   .                    4,006,116
                        Fiscal       year 1986 . . . . .         .   .   .   .   .   .   ..   .   .   .   .   .   .   .   .   ..   .   .   ..   .   .   .   .   .   .   .                    5,695,374
                        Fiscal       year 1987 . . . . .         .   .   .   .   .   .   ..   .   .   .   .   .   .   .   .   ..   .   .   ..   .   .   .   .   .   .   .
                                                                                                                                                                                     -D

                                                                                                                                                                                           476.351.269



                  Capital        funds:

                     Current       year     capital          appropriation                                    (no year)........                                                             33.715.oQQ

                     Obligated        capital         funds          brought                      forward:

                        Fiscal       year 1980..................................                                                                                                                    12,070
                        Fiscal       years 1981 through                1987....................
                                                                                                                                                                                           23.779.004

                     Unobligated          capital         funds              brought                      forward                      (no year):

                        Fiscal       year 1980 . . . . . . . . . . . . . . . . . . ..-.-...........                                                                                                  8,257
                        Fiscal       years 1981 through            1987....................
                                                                                                                                                                                     -s

                                                                                                                                                                                            59.8Ol.QZ6




                   Emergency       fund        (no year)        ..............................                                                                                              10.000.000

                TOTAL SOURCE OF APPROPRIATIONS . . . . . . . . . . . . . . . . . . . . . . . . . .                                                                          $        -    $546.152.295

                                                                                                                                                                                           (Note     10)



                The accompanying            notes        are     an integral                                  part             of          this             statement.




                                                             Page 14                                                                                                            GAO/AFMD-90.105       Panama Canal Ckxnmission
                                            Finandd                   statementa




APPLICATION           OF APPROPRIATIONS:

   Appropriations            available          ...............................                                                                                        $         -   $546.152.295
      Less     appropriated              expenditures                         - 1st                   Quarter:

         Pkpendituree             from     operating                      appropriations:

             Fiscal       year     1980 . . . . .     .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .   .   .   .   .   .   .   .   .   .
             Fiscal       years     - Merged          .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .   .   .   .   .   .   .   .   .   .                       (496 r58i)
             Fiscal       year     1986 . . . . .     .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .   .   .   .   .   .   .   .   .   .                        447,217
             Fiscal       year     1987 . . . . .     .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .   .   .   .   .   .   .   .   .   .                     329653,300
             Fiscal       year     1988 . . . . .     .   .   .   .   .   .   .   .   .   .   .   .   .   .   .   .    .   .   .   .   .   .   .   .   .   .   .   .
                                                                                                                                                                                      iiizsks

         Ilxpenditures            from     capital                appropriations:

             Fiscal       year 1980 ,,,....,.........................                                                                                                                            12,506
             Fiscal       years 1981 through               1988...................
                                                                                                                                                                                      IzIiEG

                                                                                                                                                                                      lJ5.134.733

      Less     funds      transferred           to the                    revolving                               fund:

         From Operations:

             Fiscal  year 1980 .................................                                                                                                                           311,229
             Fiscal  year 1980 reetored               ........................                                                                                                             105,231
             Fiscal  years - Merged ............................                                                                                                                        4,502,700
             Fiscal  year 1986 .................................                                                                                                                        5,248,157
             Fiscal  year 1987 .................................                                                                                                                       12,992,019
             Fiscal  year 1988 .................................                                                                                                                      179,157,285
             Emergency fund ...................................
                                                                                                                                                                                      iits!E%

        From Capital:

             Fiscal      year 1980 . . . . ..*..........................                                                                                                                          7,821
             Fiscal      years 1981 and 1988.......................
                                                                                                                                                                                      litI%%

                                                                                                                                                                                      266.377282
     Less     funds       returned         to   the           U.S.                Treasury                        .............                                                       l64.6399811

BALANCE OF APPROPRIATIONS ................................                                                                                                             $         -   S

                                                                                                                                                                                         (Note     10)



The accompanying             notes        are   an integral                                   part                of           this                statement.




                                           Page 16                                                                                                                         GAO/AFMDgO-105Panama           Ca.nalCommission
                                                      Fimndal       Statements




Notes to Financial Statements

                     1.    moflinnificant                                                          .

                           A summary        of   significant         accounting         policies       follows:

                           a.    m                    and &~~&ng.             As required        by section         1311(a)       of the
                     Pansma Canal Act of 1979 (Public                  law 96-70),       hereafter      referred       to as the Act,
                     the accounts       of the Cosm~ission           are maintained          pursuant      to the Accounting            and
                     Auditing     Act      of     1950.       This  requires       that     the    principles,          standards       and
                     related    requirements            be met , as prescribed          by the Comptroller            General     of the
                     United    States,        after      consulting     with    the Secretary         of the Treasury            and the
                     Director     of the Office            of Management       and Budget concerning             their      accounting,
                     financial      reporting         and budgetary       needs.     The Accounting           and Auditing        Act of
                     1950 also requires             that the accounts        be maintained       on an accrual         basis.

                            b.      WRecwcrv.                  As required     by section         1341(e)(l)       of the Act,       the
                     application            of generally        accepted   accounting       principles        to the Panama Canal
                     Cofmnission,           a United     States     Government    agency comparable            to a rate-regulated
                     public       utility,        determines       the manner      in which        costs     are recognized.         The
                     basis      for       tolls    rates     is prescribed      in section          1602(b)     of the Act.        This
                     section      of the Act. known as the “statutory                 tolls     formula,”       provides   that:

                                          “Tolls       shall     be prescribed             at     rates        calculated         to
                                   produce        revenues         to cover        as nearly        as practicable              all
                                   costs       of maintaining               and operating            the Panama Canal,
                                   together         with      the facilities            and appurtenances                 related
                                   thereto,          including          unrecovered          costs        incurred           on or
                                   after        the       effective          date      of      this        Act,       interest,
                                   depreciation,             working       capital,       payments         to the Republic
                                   of Panama pursuant                  to paragraph           5 of Article               III    and
                                   paragraph          4(a)      and (b) of Article                 XIII      of the Panama
                                   Canal Treaty            of 1977, and capital               for plant          replacement,
                                   expansion,             and       improvements.             Tolls         shall        not      be
                                   prescribed            at     rates       calculated          to      produce         revenues
                                   sufficient           to cover        payments       to the Republic               of Panama
                                   pursuant        to paragraph           4(c) of Article            XIII     of the Panama
                                   Canal Treaty            of 1977.”


                          Under      this      statutory      tolls    formula,       any unrecovered      costs   are   to be
                     recovered      from subsequent          revenues.       The amount for       recovery    from subsequent
                     revenues     is transferred          from Invested       Capital     to an account     within   the Other
                     Assets    classification.           Unrecovered      costs   are charged back to Invested          Capital
                     to the extent         subsequent     annual    revenues    exceed annual costs.

                           C.             tv.     Pm                         .    Property,   plant    and equipment      are
                     recorded     at cost,      or if acquired       from another     United  States   Government    agency,
                     at the value          determined      by the Director          of the Office      of Management      and
                     Budget.       Administrative         and other      related      general   expenses    are   recovered
                     currently      and therefore       not capitalized.         The cost of minor items of property,
                     plant     and equipment       is charged   to expense as incurred.




                                                      Page 16                                                             GAO/AF’MDfM%lOS   Panama Canal Chnmission
                                  Pinandd      Statements




      d.    -for                                 A portion      of tolls       in excess    of depreciation
recoveries        may be prograrmred          annually      by the Board          of Directors        for   plant
replacement,         expansion,       or improvements.            Such funds       are considered         capital
advances       from Canal        users.      Upon utilization,           these     advances     are amortized
through       an of feet        to    depreciation         expense     in     an amount        calculated         to
approximate        the depreciation        on assets       acquired    with     such advances.         In fiscal
years    1989 and 1988 no amounts from tolls                  were programmed for such purpose.

       At the direction            of the Board of Directors,         a system was implemented             in
fiscal     year 1983 whereby           shippers,   for a fee,    can make an advance           reservation
for a vessel         transit.        Such funds are considered         capital     advances     from Canal
users     and upon utilization,             the advances   are smortized         through     an offset     to
depreciation        expense       in an smount calculated       to approximate         the depreciation
on assets       acquired       with   such advances.     This system         generated     funds of $4.5
million      in fiscal      year 1989 and $8.5 million        in fiscal      year 1988.

      e.       s.                       Property,       plant      and equipment   are depreciated         over
their     estimated        service      lives     at   rates     computed   using a straight-line        method
with     additional        annual      depreciation,         identified    as composite,      to provide     for
premature         plant   retirements.

     The recurring        costs      of dredging       the waterway       are             charged      to expense.
Non-recurring      dredging      costs    for   substantial      improvements               and betterments       to
the    waterway     are   considered        additions        to plant    and             are    capitalized     and
depreciated     over their      estimated     service     lives.

       f.     vRaeeivable.                    Uncollectible    accounts   receivable     of the Panama
Canal Cosm~ission           are recognized       as a reduction      in revenue      when written       off.
Any       subsequent       collections       of    Commission    accounts     receivable       previously
written       off are recorded         as revenue.

      8.    Invantorias.       Operating  materials    and supplies      are stated      at                   average
cost,    plus cost of transportation         to the ultimate      destination      on the                     Isthmus
of Panama.        An allowance    has been established    to reflect       the estimated                      cost of
obsolete     and excess stock.

      h.    mt           Banefits.         Employer     contributions         to the United       States
Civil    Service Retirement        System,    to the Federal           Employee  Retirement     System,
and to the Republic      of Panama social           security      system are charged        to expense.
The Conaission    has no liability          for future       payments      to employees    under these
eye terns.

      Non-United        States      citizen      employees,       who retired       from predecessor         agencies
prior    to October           5, 1958, are not covered                by the United        States     Civil    Service
Retirement        System but            do receive        benefits        under   a separate         annuity      plan.
Payments made under this                  annuity     plan are recorded          as a current         year expense.
Annual amounts expanded                  were $1.3 million           in fiscal     years    1989 and 1988.           The
Cosm~ission’s        liability         for future       annuity       payments    to these       former     employees
or their      eligible         widows      is reflected       in the statement           of financial        position
as retirement          benefits       to certain       former      employees    of predecessor          agencies     and
an equal amount is recorded                  as a deferred          charge.

      Aa     required     by the Act,    the Panama Canal                  Commission     is      liable     for    the
increase        in    the   unfunded  liability   of  the                  United    States         Civil     Service

  *




                                  Page 17                                                    GAO/AFMD-W-105           Panama canal commission
                                                                                                                                                  _
                              FinandalStatementa




Retirement   Fund which    is attributable       to benefits                      payable    from that    fund to,
or on behalf     of,  employees     and their      survivors                     under    the early    retirement
provisions   of the Act.        The annual     installment                       to liquidate      the increased
liability  is determined     by the Office    of Personnel                       Management.

      i.     -aform                                   . A reserve             is provided     through    an annual
charge     to expense        to cover       the estimated  cost of            periodic    lock overhauls.

      j-       -for                                         A reserve         is provided    through          an annual
charge        to expense      to   cover      the   estimated    cost        of marine    accidents           and other
casualty         losses.

      k.     mrve      for                                          Ovw.               A reserve           is provided
through     an annual    charge            to expense      to    cover   the     estimated    cost        of overhauls
to the     Conmniseion tugboat             fleet.

        1.  J&&&g       Use        w.             No monetary     value   is assigned     to the rights
granted    to the United            States     Government    by the Republic    of Panama to use Canal
Area housing      transferred             to the Government        of Panama under the terms of the
Panama Canal        Treaty          of     1977.     The cost     to manage,     maintain   and provide
livability      improvements             to these      quarters      is charged   to expense.    Rental
income is included         in      other     revenues.

       m.              Ini-                                      . The Panama Canal Cosnnission       is
liable     for       the    cost      of    all   benefits     due under     the  Federal   Employees
Compensation          Act which       provides    compensation    for performance    of duty injuries
for eligible          employees.         The costs of the FECA program are recognized         over the
life    of the      Treaty.

2.    Plant                                     .

       At July        1, 1951,       certain         valuation        allowances         for     property,        plant   and
equipment         transferred        from      the Panama Canal                 (agency)       to the Panama Canal
Company and the Canal Zone Government                             were established,              to reduce        to usable
value     the costs        of the assets          transferred.            At October        1. 1979, such valuation
allowances         as were applicable              to the assets           transferred        from the Panama Canal
Company and the Canal                  Zone Government              to the Panama Canal                 Commission       were
carried       forward      and are comprised             of:      (a) $4.1 million            at September          30, 1989
and $4.5 million             at September          30, 1988, to reduce to usable                     value     the cost of
property,        plant     and equipment           transferred;          (b) $50.9 million            at September        30,
1989 and 1988,               to offset         interest         costs       imputed       for     the    original       Canal
construction          period;      and (c) $42.3 million                 at September         30, 1989 and 1988, to
offset      the cost of defense             facilities          and suspended          construction         projects,     the
latter       being     principally        the partial            construction           of a third          set of locks
abandoned        in the early        part of World War II.

3.    -Reeourcee.

      a.   Cash,     accounts      receivable,        and     the    borrowing       authority        are    the
resources    used to determine          the Commission’s          solvency     position        as prescribed
in Section     86.6 Office      of Management and Budget Circular                A-34,     Instructions        on
Budget    Execution,      under     which      the  incurring        of obligations           in excess        of
budgetary     resources      is   a violation         of    the Antideficiency            Act.       All   cash
exceeding    current     operating       requirements        is kept      on deposit         with    the U.S.
Treasury.




                              Page18                                                          GAO/AFMD-9O-1OBPaxuuna            CanalCommission
                               FWandal         Statement8




     b.   The Panama Canal Cosnsiseion   has authority     to borrow  funds from the
U.S. Treasury   not to exceed $100 million     outstanding   at any time for any of
the purposes  of the Cosnniesion.    At September    30, 1989 and 1988 none of these
funds had been borrowed.

4.   Vnrccovercd                 due fram                               Rev-      .

      Pursuant      to the provisions        of section                   1602(b)    of the Act,       the net losses
of $7.3 million         from fiscal     year 1989 and                    $2.4 million       from fiscal    years   1988
and 1987 operations,          totalling     $9.7 million,                    were deferred      as an unearned     cost
to be recovered        from subsequent        revenues.                   Also,   section     1341(b)(2)   of the Act
requires    recovery       of these unearned        costs               before    determining      any net operating
revenues    due to the Government            of Panama ,                 as provided      for under Article      XIII,
paragraph     4(c),    of the Panama Canal Treaty                        of 1977.

5.   CQstofe                                                   .

       The Coamiasion        administers         a program    to compensate      certain  employees       for
death and disability             resulting       from performance      of duty injuries     or illnesses
as set forth        in the Federal             Employees’    Compensation     Act (FECA).      All   United
States    citieen       employees       are eligible      for coverage,      as are non-United       States
citizen      employees       hired       prior     to October      1, 1979.     As provided       by FECA,
employees       and certain        dependents        are beneficiaries      for various     periods     that
can extend       to life.

     The liability          and deferred           charge    recorded     in these statements          reflect    the
payments    due to a Department                 of Labor fund established               pursuant   to Public      Law
100-705.     The Department            of      Labor will       be reimbursed         from this     fund for all
expected    future       payments       for       accidents,      adjusted     for     inflation     and interest
earned.      An evaluation             as        of    September       30,   1989,        was prepared         by an
independent       actuarial      firm.          The results        of that     report       were used to adjust
the assets     and liabilities           as     follows:



Cost of work       injuries  compensation
 benefits at       September  30, 1988...................                                                 $79.1

       Amount     amortized      in   fiscal      year      1989.........                $(7-O)

       Adjustments     due to study:
             Accrued   liability........................
             Long-term     liability            ......................

                Change     in assets       and liabilities.......

Coat of work       injuries  compensation
 benefits at       September  30, 1989 . . . . . . . . . . . . . . . . . .

6.   PInvaetmant                                  of     the       -a                 Govm           *

      The interest-bearing           investment       of the United    States   Government     in                  the
Panama Canal        is     determined       based      on section   1603(a)    of   the   Act.                     The
interest-bearing        investment       of the United      States  Government    at September                     30,
1989 and 1988, was determined              as follows:
 I




                               Page 19                                                            GAO/AFMD-90406    Panama Canal Commission
                                                                                                                                                 ,
                                   Pinandal       Statements




Investment          at      Beptember         30,     1987 ...................                                 $ 64.7

       Fiscal       year 1988 transactions:
                Adjustment      for interest                  accrued
                 10/l/79    - 12/31/85 .......................                                  $       61.7
                Disbursements        .............................                                    433.1
                Receipts ..................................                                          (456.3)
                Net property        transfers             ....................                      (0.4)
                   Net change ..............................

Inveetment          at      September         30,     1988 ...................                                  102.8

       Fiscal       year 1989 transactions:
                Disbursements        .............................                                    486.7
                Receipts ..................................                                          (441.4)
                Net property        transfers             ....................                      (0.2)
                   Net change ..............................

Investment          at      September         30,     1989 ...................                                 e!!a

7.   Rtaerve          for        Marine.

      A reaesesament   of the                       Reserve     for        Marine Accidents    was made in fiscal     year
1989 and based       on past                        experience,             the Board    approved   a reserve     balance
objective    of $7.0 million.

8.   Statement              of    -Flows.

Fiscal     year 1989 Statement         of Cash Flows reflects          the use of revolving       funds
only.      The fiscal     year    1988 statement     identifies        as "Other  adjustments"       the
appropriated       funds   received      by the Commission       prior     to its  conversion      to a
revolving      fund agency on January         1, 1988.     All  funds received      after    that date
were recorded       as revolving     funds.

In addition,             certain  data              in the fiscal     year 1988 Statement     of Cash Flows was
restated     for          fiscal  year              1989 presentation      to eliminate    non fund items not
pertinent      to        the Statement                of Cash Flows thereby      improving   comparison  between
years.

9.   p.

      In fiscal         year 1988, in addition             to converting      the Panama Canal Connsission
to a revolving            fund agency,       Public      Law 100-203,     The Budget Reconciliation         Act
of 1987. provided:                (a) for      restoring       $61.7 million       to the interest-bearing
investment        of the United         States     Government      in the Panama Canal by transferring
interest       collections        prior    to January        1, 1986 to the General          Fund of the U.S.
Treasury,        and (b) for reimbursing              to the General      Fund of the U.S. Treasury         the
$85.6       million         unpaid      balance        of     the    Cosnsission's      fiscal     year    1980
appropriation.             These transactions          were completed      in fiscal    year 1988.




                                   Page 20                                                           GAO/AFMD-9b106     Panama Canal Chndssion
                                 Financial   Statements




10. &&#M&t             of   SLafars   of AoDrooriatione       .

       This statement         reflects      the conversion       of the Panama Canal Cosnsission           from
an appropriated             fund      agency    to a revolving          fund    agency.     As such,         the
statement       identifies:        (a) expenditures        made by the Cosnsission       during     the first
quarter     operations         as an appropriated           fund agency,      (b) funds    transferred         to
the revolving           fund as of January         1, 1988, and (c) funds returned              to the U.S.
Treasury,       also      as of January        1, 1988.       This  statement      is not applicable         for
fiscal     year      1989 and is shown only              to conform      with    the two year       statement
format.

11.     Q                                                         l




         In    addition     to recorded        liabilities,          the    estimated     maximum contingent
liability           which   could      result     from      pending     claims     and lawsuits          was $10.1
million        at September       30, 1989 and $18.6 million               at September       30, 1988.      In the
opinion         of management         and the Commission’s               General     Counsel,     these     pending
claims        and lawsuits       will     be resolved        with   no material       adverse     effect     on the
financial         condition    of the agency.

      Coamitmants   under uncompleted    construction      contracts and unfilled                        purchase
orders   amounted    to $38.0 million    at September       30, 1989 and $42.2                       million      at
September     30,  1988.    Of these    amounts,      $0.1 million   in unfilled                          purchase
orders   were prepaid    as of September 30, 1989 and 1988.

     Cash and negotiable           securities      of a kind acceptable      by the United    States
Government        in the amount of $12.4 million             were held     by the United      States
depositories        designated    by the Panama Canal Commission           at September    30, 1989
and $11.6 million          at September       30, 1988, to guarantee    payment by third     parties
of their     obligations.

       The Panama Canal Treaty          of 1977, Article          XIII,      paragraph       4(c),    provides
that an annual      amount of up to $10 million              per year be paid to the Government
of Panama out of operating            revenues       to the extent         that     such revenues        exceed
expenditures.         Payment      to  the      Government      of      Panama       is    subject     to     the
limitations      set forth     in section       1341(e)    of the Act.           In the event operating
revenues      in any year        do not      produce      a surplus       sufficient         to cover       this
paylnent , the unpaid       balance    shall      be paid from operating              surpluses     in future
years     up to the amount available             from these     surpluses.           As of September          30,
1989, the balance        contingently      payable      to the Government           of Panama amounts to
$91.1 million.        As of September         30, 1988, the balance             contingently       payable      to
the Government      of Panama amounted to $81.1 million.

12.     wImDect.

       On September        7, 1977, the United               States   of America     and the Republic         of
Panama signed         the Panama Canal Treaty                 of 1977.     The Treaty    provided       for the
establishment         of the Panama Canal Cosnsission                  on October     1, 1979,      to assume
certain     operational         responsibilities           for    the Canal until      December 31, 1999.
When the Treaty          terminates       on December 31, 1999, the Republic                of Panama shall
assume total        responsibility           for the management,         operation,    and maintenance        of
the Panama Canal,           which shall          be turned      over in operating      condition      and free
of liens      and debts,           except       as the two parties          may otherwise        agree.     The
effects     of these       long-range         requirements        are not considered      in the financial
statements.




                                Page 21                                                  GAO/AFMD-90-105         Panama Canal Commission
                                                                                                                                                         .


SupplementaryInformation


Scheduler of Treaty-Related Coats (Unaudited)

                                                                Non-DOD Costs            (Savings)      Through     Fiscal      Year 1989

                                                                Prior     FY                  FY 1989                   Total
                        Agency                                  costs     (note     a)        costs                     costs

              State     Deparbnent                              $(13,959,187)                 $(l,BOO,OOO)              $(15,759,187)
              Federal Aviation
               Administration                                    (32,213,783)                     (4,251,300)                (36,465,083)
              American Battle
               Monuments Commission                                 3,025,203                         291,747                  3,316,950
              Panama Canal           Commission                          300,000                                0                 300,000
              General      Accounting            Office             1,614,251                          14,316                  1,628,567
              Smithsonian  Tropical
               Research Institute                                   2,977,636                        470,471                   3,448,107
              Gorgas      Memorial        Laboratory                    (257,351)                               0                (257,351)
              Canal     Area      Court    System
               U.S.     Attorney                                      (786,120)                      (160,305)                   (946,425)
               U.S.     Marshal                                       (418,070)                        (54,245)                  (472,315)
               Clerk      of Court                                 (3,586,660)                       (627,755)                (4,214,415)
              Bureau      of   Prisons                              1,728,697                         736,220                  2,464,917
              Foreign    Broadcast
               Information     System                                    274,915                       85,713                     360,628
              National   Oceanic and
               Atmospheric   Administration                               66,549                       12,130                      78,679

              Total     Non-DOD                                                               -                         Srb6.53



              Notes
              -Includes             prior-year            adjustments




                                                     Page22                                                  GAO/AFMD-SO-105Panama           CanalCommbion
                                   Supplementary     Information




                                               Department of Defense             (DOD) Costs      (Savings)
                                               Through FY 1989

                                               Prior      FY                FY 89                Total
         Agency                                costs      (note        a)   costs                costs

U.S. Army
 Base Operations                               $137,957,661                 $20,271,288          $158,228,949
 Communications                                     24,326,084                2,630,206            26,956,290
 Commissary                                          8,590,791                   436,705             9,027,496
 Transportation                                      2,901,066                      1,473            2,902,539
 Technical     Assistance                               360,240                          0              360,240
 Health Services                                   104,984,703               13,052,504           118,037,207
 Disposition      of Remains                          2,661,940                  412,021             3,073,961
 Criminal     Investigations                             597,781                 143;555                741,336
 Tropical     Test Center                                 35,408                            0            35,408
 Procurement      of Equipment                       3,046,789                              0        3,046,789
 Military     Construction                          36,397,791                              0      36,397,791
 Military     Pay                                   77,276,347                6,063,603            83,339,950
 Ports                                                  165,868                                         165,868
 Family Housing Operations                          11,813,728                1,659,54:             13,473,270
 Executive      Agent Costs                                        0          1,712,152              1,712,152

Total     Army                                     411,116,197               46,383,049            457,499,246


U.S.    Air     Force                               34,017,722                2,863,609             36,881,331

U.S.    Navy                                             943,022                (205,978)                 737,044

DOD Dependents           Schools     (note    b)      3,887,OOO                5,068,OOO                8,955,OOO

Defense        Mapping    Agency                      1,158,764                                         1,158,764

Total     DOD


Notes
a   Includes  prior    year          adjuslments
                                         ..      .
b Obligations      incurrea           rawer    tnan        actual _ expenditures




                                   Page 23                                            GAO/APMD-90-105    Panama Canal Commission
                             Supplementary     hUormation




                                             Property  Transferred  by the Dept. of Defense
                                             and the Federal Aviation    Administration to
                                             the Republic   of Panama Since October 1, 1979

                                             Prior            FY 1989                Total
        Agency                               transfers        transfers              transfers

Department      of Defense
 U.S.   Army                                 $40,338,046       $           0        $40,338,046
 U.S.   Navy                                   4,930,769                   0          4,930,769
 U.S.   Air    Force                               275,874                 0                275,874

Total   DOD                                   45,544,689                   0         451544,689

Federal    Aviation
 Administration                                 4,638,360                  0          4,638,360

Total                                                          s-




                             Page 24                                      GAO/APMD-SO-106     Panama Canal Commission
                              Supplementary     Information




                                              Property  Transferred  by the Pamana Canal
                                              Commission and Predecessor    Organizations to
                                              thepublic      of Panama Since October 1, 1979

                                                              Acquisition      Cost

                                              Prior               FY 1989             Total
        Agency                                transfers           transfers           transfers
Canal Zone Government and
 Panama Canal Company                         $168,317,629        $           0       $168,317,629
Panama Canal     Commission                     29,225,827                                  29,225,827

Total


                                                                 Net Book Value

                                              Prior               FY 1989             Total
        Agency                                transfers           transfers           transfers


Canal Zone Government and
 Panama Canal Company                         $84,886,222         8           0       $84,886,222
Panama Canal     Commission                     9,614,749                                   9,614,749

Total




                          Page 25                                           GAO/AFMD-BMO5      Panama canal commieslon
                                                                           Supplementary      Information




Schedule of Property, Plant, and Equipment (Unaudited)

                                                                                     September        30, 1989 and 1988

                                                                                                                        1   9   8 9                                1   9   8     8
                                                                                     Estimated                                  Depreciation                                   Depreciation
                                                                                      Service                                   and valuation                                  and valuntion
                                                                                       Life                      cost                                       cost
       Titlea      and treaty          rights...................                           40 yrs.          $ 14,728,889         $     5,983,612     $ 14.728.889               $     5,615,390

       Intereat       during     construction...............                                                  50,892,311              50,892,311       50.892.311                    50,892,311

      Canal       excavation,          fills      and embankments....                15-100 yra.             347,753,732             140,138,508      347,555,199                   131,595,146

      Canal structureo            and equipment.............                          4-100 yrs.             326,975,387             157,356,034      317,897,397                   151,022,970

      Supporting         and    general         facilities..........                  S-100 yrs.             146,352,516              87,790,847      131.459.891                    83.223.723

      Facilities         held    for       future       use.............             lo-100    yre.            3,330.878               2,577,077        2.824.202                     2,377,516

      Plant       additions      in progress................                                                  39.450.822                               30,607,367

      Suspended construction                    projecte............                                          40.1-                                    40.14-

      TOTAL                                                                                                 tP69.630.333         5484.884.187       $936.111.054                5464.872.854




(9161SQ)                                                                   Page 20                                                        GAO/AFMD-90-106       Panama Canal C4unm&eion
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