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Note 3. Accounts Receivable

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Accounts receivable consist of amounts owed the CFTC by other Federal agencies and the public. Accounts receivable are valued at their net collectable values. Non-custodial accounts receivable are primarily for overpayments of expenses to other agencies, or vendors, and repayment of employee benefits. Historical experience has indicated that most of the non-custodial receivables are collectible and there are no material uncollectible amounts.

Custodial receivables (non-entity assets) are those for which fines and penalties have been assessed and levied against businesses or individuals for violations of the CEA or Commission regulations. Violators may be subject to a variety of sanctions including fines, injunctive orders, bars or suspensions, rescissions of illegal contracts, disgorgements, and restitutions to customers.

Historical experience has indicated that a high percentage of custodial receivables prove uncollectible. The Commission’s methodology used to estimate the allowance for uncollectible amounts related to custodial accounts, considers all receivables to be 100 percent uncollectible unless deemed otherwise. An allowance for uncollectible accounts has been established and included in accounts receivable on the balance sheets. The allowance is based on past experience in the collection of accounts receivable and analysis of outstanding balances. Accounts are re-estimated quarterly based on account reviews and the agency determination that changes to the net realizable value are needed.

Beginning in FY 2009, the Commission no longer records restitution sanctions as custodial receivables. Prior year amounts are presented as previously reported.

Accounts receivable, as of September 30, 2009 and 2008, consisted of the following:

Accounts Receivable
As of September 30, 2009 and 2008
  2009 2008
Custodial Receivables, Net:    
Civil Monetary Penalty Interest $1,837,945 $23,073,549
Civil Monetary Penalties, Fines, and Administrative Fees 224,068,663 1,431,481,645
Less: Allowance for Loss on Interest (1,834,753) (23,069,460)
Less: Allowance for Loss on Penalties, Fines, and Administrative Fees (223,040,935) (1,430,214,727)
Registration and Filing Fees 672,300 450,519
NET CUSTODIAL RECEIVABLES $1,703,220 $1,721,526
ACCOUNTS RECEIVABLE, NET $1,721,427 $1,733,060