DIRECTIVE	:	UNEMPLOYMENT INSURANCE PROGRAM LETTER NO. 47-89, CHANGE 1
TO	:	ALL STATE EMPLOYMENT SECURITY AGENCIES
FROM	:	DONALD J. KULICK Administrator for Regional Management
SUBJECT	:	Frequency and Purpose of Aging Schedules for Delinquent Unemployment Insurance (UI) Contributions and Benefit Overpayments

1. Purpose. To respond to questions concerning the purpose for requiring States to establish aging schedules of delinquent UI contributions, payments in lieu of contributions and benefit overpayments and to revise the frequency of recording the ace of receivables.

2. Reference. Unemployment Insurance Procram Letter No. 47-89.

3. Background. UIPL 47-89 provided Guidance to States to ensure that systems are in place to capture data on the age of delinquent accounts and suggested annualized criteria as an effective basis. It bas since been determined that annualized data are not sufficient for the Department to meet its reporting responsibilities to the Department of the Treasury.

4. Discussion. In accordance with General Accounting Office and U. S. Treasury requirements for Federal agencies financial reporting under the Treasury Financial Manual, the Department of Labor must report financial data which include, in part, amounts receivable less an allowance for amounts estimated to be uncollectible. The annual financial statements which must be prepared include the Unemployment Trust Fund, the majority of which is comprised of State unemployment funds. The reporting system, based on modified accrual accounting, reports assets and liabilities when they occur rather than when cash is actually received or paid. A tracking process based on aging of delinquent accounts (receivables) is considered the most feasible method for National Office development of a reasonable asset value for receivables. A viable evaluation of collectibility cannot be made solely on the basis of annual comparisons. Office of Management and Budget (OMB) approval for a chance in State reporting of contributions and payments in lieu of contributions has been requested. Similar action is being prepared for benefit overpayment reporting It is anticipated that States will be required to report certain summary information on the age and amount of delinquent contributions, payments in lieu of contributions and benefit overpayments in increments of those accounts that are 6 months (2 quarters), 9 months, 12 months, 15 months and 18 plus months delinquent.

5. Action Required. SESAs are requested to establish aging schedules that will capture receivable amounts on the basis of the quarterly criteria indicated above. To allow for chances in the frequency of capturing the data, the January implementation is advanced to March 1990.

6. Inquiries. Inquiries should be directed to the appropriate Regional Office.