Page 55 - Financial Report 2020

PRIVACY AND CIVIL LIBERTIES OVERSIGHT BOARD

Notes to the Financial Statements

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Reporting Entity

The Privacy and Civil Liberties Oversight Board was created upon the recommendation of
the 9/11 Commission whose 2004 report firmly declared that preventing terrorism does
not require sacrificing the values that make us strong. Congress established the Board in
2007 as an independent agency within the executive branch led by a bipartisan, five-
member Board, comprised of a full-time chairman and four part-time Board Members, all of
whom are appointed by the President, with the advice and consent of the Senate, for
staggered six-year terms. No more than three of the five Board Members may be from the
same political party, and the President must consult with the congressional leadership of
the opposing party before appointing members who are not from the President’s political
party.

Although PCLOB was formally created as an independent agency in 2007, it did not begin
operations until August 2012 when the Board’s four part-time members were confirmed by
the Senate, providing the Board with a quorum to begin the activity. The Board became
fully functional in until May 2013, when the Board’s first chairman was confirmed.

Since then, the Board has continued establishing itself as an independent agency while
simultaneously pursuing its statutory mission: to ensure that the Federal Government’s
efforts to prevent terrorism are balanced with the need to protect privacy and civil
liberties. By offering its independent but informed views and analyses, PCLOB assists the
executive branch in formulating policy regarding counterterrorism efforts and it adds an
important voice to broader discussions involving lawmakers and the public about striking
the right balance between liberty and security in those efforts.

B. Basis of Presentation

The financial statements have been prepared to report the financial position and results of
operations of PCLOB. The Balance Sheet presents the financial position of the agency. The
Statement of Net Cost presents the agency’s operating results; the Statement of Changes in
Net Position displays the changes in the agency’s equity accounts. The Statement of
Budgetary Resources presents the sources, status, and uses of the agency’s resources and
follows the rules for the Budget of the United States Government.

These financial statements are a requirement of the Accountability of Tax Dollars Act of
2002 and have been prepared from, and are fully supported by, the books and records of
PCLOB in accordance with the hierarchy of accounting principles generally accepted in the
United States of America, standards issued by FASAB, OMB Circular A-136, Financial
Reporting Requirements, as amended, and PCLOB accounting policies which are
summarized in this note. These statements, apart from the Statement of Budgetary

FY 2020 AGENCY FINANCIAL REPORT 46