[Senate Report 105-241]
[From the U.S. Government Publishing Office]
Calendar No. 458
105th Congress Report
SENATE
2d Session 105-241
_______________________________________________________________________
QUARTERLY FINANCIAL REPORT PROGRAM
__________
R E P O R T
of the
COMMITTEE ON GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
to accompany
S. 2071
TO EXTEND A QUARTERLY FINANCIAL REPORT PROGRAM ADMINISTERED BY THE
SECRETARY OF COMMERCE
July 8, 1998.--Ordered to be printed
COMMITTEE ON GOVERNMENTAL AFFAIRS
FRED THOMPSON, Tennessee, Chairman
WILLIAM V. ROTH, Jr., Delaware JOHN GLENN, Ohio
TED STEVENS, Alaska CARL LEVIN, Michigan
SUSAN M. COLLINS, Maine JOSEPH I. LIEBERMAN, Connecticut
SAM BROWNBACK, Kansas DANIEL K. AKAKA, Hawaii
PETE V. DOMENICI, New Mexico RICHARD J. DURBIN, Illinois
THAD COCHRAN, Mississippi ROBERT G. TORRICELLI, New Jersey
DON NICKLES, Oklahoma MAX CLELAND, Georgia
ARLEN SPECTER, Pennsylvania
Hannah S. Sistare, Staff Director and Counsel
Kristine I. Simmons, Professional Staff Member
Leonard Weiss, Minority Staff Director
Debbie Cohen Lehrich, Minority Counsel
Lynn L. Baker, Chief Clerk
C O N T E N T S
----------
Page
I. Summary and Purpose..............................................1
II. Background.......................................................1
III. Legislative History..............................................2
IV. Section-by-Section Analysis......................................2
V. Estimated Cost of Legislation....................................2
VI. Evaluation of Regulatory Impact..................................4
VII. Changes in Existing Law..........................................4
Calendar No. 458
105th Congress Report
SENATE
2d Session 105-241
_______________________________________________________________________
REAUTHORIZATION OF THE QUARTERLY FINANCIAL REPORT PROGRAM
_______
July 8, 1998.--Ordered to be printed
_______________________________________________________________________
Mr. Thompson, from the Committee on Governmental Affairs, submitted the
following
R E P O R T
[To accompany S. 2071]
The Committee on Governmental Affairs, to which was
referred the bill (S. 2071) to extend a quarterly financial
report program administered by the Secretary of Commerce,
having considered the same, reports favorably on the bill and
recommends that the bill do pass.
I. Summary and Purpose
S. 2071 reauthorizes through 2005 the Quarterly Financial
Report program administered by the Census Bureau for the
Secretary of Commerce. The purpose is to ensure a continuation
of this survey that documents financial conditions for
manufacturing, retail, wholesale and mining corporations each
calendar quarter.
II. Background
Section 91 of Title 13, United States Code, requires the
Secretary of Commerce to collect and publish quarterly
statistics on business operations and organizations, including
data on sales, expenses, profits, assets, liabilities,
stockholders' equity, and related accounts generally used by
businesses in income statements, balance sheets, and other
measures of financial condition. To meet these requirements,
the Census Bureau conducts the Quarterly Financial Report (QFR)
program.
The Quarterly Financial Report program has been authorized
continually since 1947. It is a two-year (eight quarter) survey
that documents financial conditions for manufacturing, retail,
wholesale and mining corporations each calendar quarter. It is
a principal economic indicator of U.S. economic performance and
a primary source of data for current estimates of the Gross
Domestic Product and national income accounts. The QFR data are
used for the Federal Reserve Board's Flow of Funds Accounts and
are the sole source of unconsolidated nonfinancial corporate
data. While the reporting rules and timing of the QFR data
collection are structured to satisfy the specific needs of the
GDP and Flow of Funds, these data support a host of other
Government and private sector uses as well. For example,
companies may use QFR data to compare their own performance to
the industry average or as a source of information for making
investment decisions.
In recent years, the Census Bureau has taken steps to
reduce the burden of the QFR program on respondents. The
current sample size of 8,000 companies for the 1998 QFR program
is half the size of the 1988 program. Questions have been
reduced by the use of short forms, and small companies that
participate in the program do not have to participate again for
up to ten years. The Bureau is also studying the use of
electronic reporting methods to further reduce respondent
burden. The Committee is encouraged by the Bureau's efforts to
reduce the burden of the QFR program on respondents, and
directs the Bureau to continue these efforts.
The Secretary of Commerce's authority to conduct the
Quarterly Financial Report program terminates on September 30,
1998. S. 2071 would extend the authority to conduct this
statistical program an additional seven years by changing the
termination date specified in Title 13, United States Code,
Section 91 note to September 30, 2005.
III. Legislative History
S. 2071 was introduced by Senator Thompson on May 13, 1998.
Senator Glenn was an original cosponsor.
The Committee dispensed with hearings and proceeded to
consider S. 2071 on June 17, 1998. No amendments were offered.
S. 2071 was ordered reported unanimously by voice vote.
IV. Section-by-Section Analysis
section 1. extension of quarterly financial report program
This section amends Section 4(b) of Public Law 97-454 (13
U.S.C. 91note), as amended, by striking ``September 30, 1998'',
which is the date on which the current authorization expires, and
inserting ``September 30, 2005''.
V. Estimated Cost of Legislation
U.S. Congress,
Congressional Budget Office,
Washington, DC, June 24, 1998.
Hon. Fred Thompson,
Chairman, Committee on Governmental Affairs, U.S. Senate, Washington,
DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 2071, a bill to
extend a quarterly financial report program administered by the
Secretary of Commerce.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Mark Hadley
(for federal costs), and May Eyles (for the private-sector
impact).
Sincerely,
June E. O'Neill, Director.
Enclosure.
CONGRESSIONAL BUDGET OFFICE COST ESTIMATE
S. 2071--A bill to extend a quarterly financial report program
administered by the Secretary of Commerce
Summary: S. 2071 would extend, until September 30, 2005,
the requirement for the Bureau of the Census to produce its
Quarterly Financial Report (QFR). Assuming appropriation of the
necessary amounts, CBO estimates that preparation and
publication of this report would cost about $16 million over
the 1999-2003 period.
S. 2071 would not affect direct spending or receipts;
therefore, pay-as-you-go procedures would not apply. The bill
contains no intergovernmental mandates as defined in the
Unfunded Mandates Reform Act (UMRA) and would not affect the
budgets of state, local, or tribal governments.
S. 2071 would impose a private-sector mandate because it
would extend the Secretary's authority to require certain
businesses to file report and answer inquiries about business
operations, organizations, practices, management, and
relationships to other businesses.
Estimated cost to the Federal Government: For the purposes
of this estimate, CBO assumes that S. 2071 will be enacted by
the end of fiscal year 1998, and that the estimated amounts
necessary to implement the bill will be appropriated by the
start of each fiscal year. Estimated outlays are based on
historical spending patterns for the Bureau of the Census and
information provided by the agency. The estimated budgetary
impact of S. 2071 is shown in the following table. The costs of
this legislation fall within budget function 370 (commerce and
housing credit).
----------------------------------------------------------------------------------------------------------------
By fiscal years, in millions of dollars--
-----------------------------------------------
1998 1999 2000 2001 2002 2003
----------------------------------------------------------------------------------------------------------------
SPENDING SUBJECT TO APPROPRIATION
Spending Under Current Law:
Budget Authority \1\........................................ 3 0 0 0 0 0
Estimated Outlays........................................... 3 1 (\2\) 0 0 0
Proposed Changes:
Estimated Authorization Level............................... 0 3 4 4 4 4
Estimated Outlays........................................... 0 2 3 3 4 4
Spending Under S. 2071:
Estimated Authorization Level \1\........................... 3 3 4 4 4 4
Estimated Outlays........................................... 3 3 3 3 4 4
----------------------------------------------------------------------------------------------------------------
\1\ The 1998 level is the amount appropriated for that year.
\2\ Less than $500,000.
Basis of estimate: The Quarterly Financial Report provides
current statistics on the financial performance and conditions
of domestic manufacturing, mining and trade corporations, based
on an extensive sample of such corporations. In 1998, the
Bureau of the Census plans to spend approximately $3 million on
the QFR, and most of the costs are for personnel. Assuming that
the bureau would maintain the current level of effort over the
1999-2003 period, the cost to the government would range
between $3 million and $4 million a year.
Pay-as-you-go considerations: None.
Estimated impact on State, local, and tribal governments:
The bill contains no intergovernmental mandates as defined in
UMRA and would not affect the budgets of state, local, or
tribal governments.
Estimated impact on the private sector: S. 2071 would
extend the Secretary's authority to require certain businesses
to file reports and answer inquires about business operations,
organizations, practices, management, and relationships to
other businesses.
CBO estimates that direct costs of this private-sector
mandate would fall well below the statutory threshold ($100
million in 1996, adjusted for inflation). Based on information
from the Census Bureau, we expect that the costs to the private
sector would be approximately $1 million per year, about the
same as they are now.
Estimate prepared by: Federal Costs: Mark Hadley; Impact on
the Private Sector: Matt Eyles.
Estimate approved by: Robert A. Sunshine, Deputy Assistant
Director for Budget Analysis.
VI. Evaluation of Regulatory Impact
Pursuant to the requirement of paragraph 11(b) of Rule XXVI
of the Standing Rules of the Senate, the Committee has
considered the regulatory and paperwork impact of S. 2071. The
legislation continues a survey in which approximately 8,000
companies participate for a two-year period. The Committee
recognizes the reporting burden that the Quarterly Financial
Report program places on respondents. The Census Bureau has
taken steps to reduce the burden of this survey, including
reducing the sample size, reducing the number of questions and
excusing small companies which have participated in the program
from participating again for up to ten years. Currently the
Bureau is studying ways to further reduce burden through the
use of electronic or Internet reporting. The Committee directs
the Census Bureau to continue these efforts to reduce the
burden of the QFR program on respondents to the greatest extent
possible.
VII. Changes in Existing Law Made by the Bill, as Reported
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic and existing law in which no change
is proposed is shown in roman):
Public Law 97-454.--An Act To amend title 13, United States Code, to
transfer responsibility for the quarterly financial report from the
Federal Trade Commission to the Secretary of Commerce, and for other
purposes (13 U.S.C. 91 note)
* * * * * * *
Section 4.
* * * * * * *
(b) This Act, including the amendments made by this Act,
shall cease to have effect after [September 30, 1998] September
30, 2005.