In fiscal year 2021, which ended on September 30, the federal budget deficit totaled nearly $2.8 trillion—about $360 billion less than the deficit in 2020, but nearly triple the shortfall incurred in 2019. During the past two years, deficits were much larger than they have been historically because of the economic effects of the coronavirus pandemic and legislation enacted in response.1 In 2021, the deficit was equal to 12.4 percent of the nation’s gross domestic product (GDP), down from 15.0 percent in 2020, but up from 4.7 percent in 2019. The 2021 deficit was the second largest as a percentage of GDP since 1945 (the largest occurred in 2020). 1. Deficit - https://www.reuters.com/world/us/us-budget-gap-narrows-more-than-expected-year-earlier-october-2021-11-10/ 2. Taxation https://taxfoundation.org/2022-tax-brackets/ 3. Healthcare - https://www.americanactionforum.org/research/key-health-policy-provisions-of-the-build-back-better-act/ 4. Infrastructure - https://www.piquenewsmagazine.com/national-business/us-infrastructure-bill-means-more-cash-and-contracts-for-wsp-global-ceo-says-4743343 5. Taxation at state and local government level - https://www.prnewswire.com/news-releases/ey-cost-study-state-and-local-government-tax-revenue-increases-despite-pandemic-301421351.html 6. Federal reserve - https://www.smh.com.au/business/banking-and-finance/us-inflation-hits-new-record-forcing-the-fed-to-rethink-its-strategy-20211111-p5981q.html 7. Climate change - https://www.ft.com/content/da0ac736-7c38-4f93-baaf-e315a51faf22 8. Housing - https://www.cnbc.com/2021/11/10/home-prices-are-now-rising-much-faster-than-incomes-studies-show.html 9. Corporate tax - https://dividedwefall.com/2021/11/05/global-minimum-corporate-tax/ 10. Productivity - https://www.reuters.com/article/usa-economy-productivity-idCAKBN2HP1O6 11. Regulations - https://news.yahoo.com/regulatory-reformers-red-tape-formidable-184826530.html 12. ESG - https://www.pwc.com/gx/en/services/sustainability/publications/cop26/how-much-does-the-public-care-about-esg-pwc-cop26.html or https://ibm.box.com/s/vmyitcackqevvm1hcxv7wke6gudrpnce 13. Energy crisis - https://www.rigzone.com/news/wire/usa_should_have_enough_gas_to_avert_energy_crisis-09-nov-2021-166955-article/ 14. Carbon tax - https://www.delawareonline.com/story/opinion/2021/11/05/u-s-must-enact-carbon-tax-its-essential-curb-climate-change/6280393001/ 15. Pensions - https://www.pewtrusts.org/en/research-and-analysis/issue-briefs/2021/09/the-state-pension-funding-gap-plans-have-stabilized-in-wake-of-pandemic 16. Unfunded liabilities - https://www.lagrangenews.com/2021/10/16/brown-column-we-must-address-the-national-debt/ 17. Policing - https://www.upworthy.com/americas-most-dangerous-city-defunded-its-police-department-7-years-ago-it-was-a-stunning-success or https://www.moneygeek.com/living/state-policing-corrections-spending/

1. PUBLIC SECTOR – UNITED STATES
Paul Young CPA CGA
November 11, 2021

2. PAUL YOUNG - BIO
• CPA, CGA
• Academia (PF1, FA4, FN2, MU1. and MS2)
• SME – Risk Management
• SME – Close, Consolidate and Reporting
• SME – Public Policy
• SME – Emerging Technology
• SME – Business Process Change
• SME – Financial Solutions
• SME – Macro/Micro Indicators
• SME – Supply Chain Management
• SME – Data, AI, Security, and Platform
• SME – Internal Controls and Auditing
Contact information email: Paul_Young_CGA@hotmail.com
LinkedIn: https://www.linkedin.com/in/paul-young-055632b/
SlideShare - https://www.slideshare.net/paulyoungcga
Twitter: https://twitter.com/paulyoungcpa
Youtube - https://www.youtube.com/user/youngercga1968/videos

3. AGENDA
• CBO Report – Fiscal Management – Federal
Government
• Corporate Taxation and United States
• USA Government Debt
• State and Local government fiscal health
• Blog – Audit and Analytics
• Blog – ESG
• Blog – Insurance and Risk Mitigation
• Blog – Governance Model

4. CBO REPORT – BUDGET – UNITED
STATES – YTD SEPTEMBER 2021
CBO - Fiscal
Management.pdf

5. GDP AND BUDGET BALANCES
Source – USA Government

6. CORPORATE TAX AND THE UNITED STATES
Pillar 1 involves reallocation of profit and revised nexus rules and is concerned with what portion of profits should be taxed in the jurisdictions where clients or
users are located. Pillar Two contains an anti-base erosion mechanism to ensure that multinational enterprises pay a minimum level of tax.
“Pillar 2 will expand the taxable revenue collected globally from corporations by implementing a global minimum tax,” said Dicker. “They’re talking about a
minimum rate of 15%. The exact rate has not been decided yet. If a country where the effective tax rate is below 15%, then the home country where the
company is located can tax on the difference. For example, if a U.S. multinational is taxed in Ireland at 12%, then the U.S. can impose a tax to bring that
company up to the global rate. For any country that has a rate below15 %, the choice is to raise their rate or forgo the tax revenue and hand it over to the parent
to the parent country. Companies will be paying the same rate; it’s just a question of where they will pay it.”
Here is my updated work on the Office of Finance as it relates to audit, reporting challenges, managing the accounting standards, and other aspects of the
close, consolidate, and reporting cycle - https://ibm.box.com/s/x973uioy6ozwkzw7yvqaa07wdldp8gld
1. Business impact - https://www.mckinsey.com/business-functions/risk-and-resilience/our-insights/covid-19-implications-for-business
2. Data sharing - https://www.govtechreview.com.au/content/gov-digital/article/three-data-sharing-challenges-facing-public-sector-922138145
3. Digital - https://www.openaccessgovernment.org/embracing-a-new-era-of-public-sector-it-smart-sourcing/116903/
4. ESG - https://www.cfodive.com/news/companies-oppose-one-size-fits-all-sec-climate-disclosure-rule-survey/604547/
5. SPAC / restatements - https://www.cfodive.com/news/almost-90-percent-spacs-restate-financials/604267/
6. Cyber defense - https://cisomag.eccouncil.org/cisa-unveils-joint-cyber-defense-collaborative-to-boost-cybersecurity/
7. Fraud - https://www.quora.com/How-does-machine-learning-facilitate-fraud-detection
8. Real-time reporting - https://www.rtinsights.com/category/industry-insight/
9. Log analytics - https://neptune.ai/blog/machine-learning-approach-to-log-analytics
10. ESG - https://www.weforum.org/agenda/2021/08/now-time-for-action-on-sustainability-reporting/
Source - https://www.accountingtoday.com/news/international-agreements-spur-move-to-global-minimum-tax?position=editorial_1&campaignname=V2_ACT_Daily_20210503-
08102021&utm_source=newsletter&utm_medium=email&utm_campaign=V2_ACT_Daily_20210503%2B%27-
%27%2B08102021&bt_ee=Nq%2Fv7c3AMvoxz%2F6ThJ8wFssJSDsjTBGSjUtT53TmJ9QvzUau3wfriBrnT0c44gCN&bt_ts=1628589736714

7. USA FEDERAL GOVERNMENT DEBT

8. STATE AND LOCAL
GOVERNMENT
FISCAL HEALTH
Source -
https://fred.stlouisfed.org/se
ries/SLEXPND

9. STATE AND
LOCAL
GOVERNMENT
Source -
https://www.gao.gov/products/
gao-21-562 or
https://www.usgovernmentspe
nding.com/local_spending_char
t

10. FISCAL SOUND STATES RANKING
Source - https://www.usnews.com/news/best-states/rankings/fiscal-
stability/long-term

11. FISCAL SOUND
LOCAL
GOVERNMENT
Source -
https://www.americancityandco
unty.com/2021/07/14/the-10-
best-run-cities-in-america/ or
https://wallethub.com/edu/bes
t-run-cities/22869

12. AUDITS (AI AND ANALYTICS)
Blog - IBM OpenPages with Watson can deliver a 218% return on investment, finds Forrester
study
https://www.ibm.com/blogs/watson/2020/12/ibm-openpages-with-watson-can-deliver-a-218-
return-on-investment-finds-forrester-study/?campaign=socialselling&share=592db045-fde8-
43e9-8ce3-ff8d18fc175b&channel=linkedin&userID=cfad680f-7c88-4a2e-82e9-
f052d0bc4447&advocacy_source=everyonesocial&es_id=581e0fab6d
This ties nicely into my work on data, AI, security, and Platform:
Audit - https://ibm.box.com/s/noi1j6ixzl6ralxkm4g0zzs911wf6s76
Data and AI - https://ibm.box.com/s/noi1j6ixzl6ralxkm4g0zzs911wf6s76
Machine Learning - https://ibm.box.com/s/7fape09ryvkrj515urhcx4estuzzp5hp

13. GOVERNMENT AND ESG REPORTING
Blog - Materiality Question Dogs SEC’s ESG Disclosure Project -
“When it comes to disclosure, investors have told us what they want,” Gensler tweeted in early August. “It’s now time for
the commission to take the baton.”
However, it would be practically impossible for the SEC to require all the above-listed information in one expansive rule.
In addition, though it might please climate change activists, it would alienate issuers and bring heaps of scorn from the
business lobby. More importantly, though, it could violate a bedrock principle of SEC disclosure mandates: materiality.
Disclosures are material when they are reasonably likely to impact a company’s financial condition or operating
performance. Therefore, they are the most important to investors, to use the definition of the Sustainability Accounting
Standards Board.
https://www.cfo.com/regulation/2021/08/materiality-question-dogs-secs-esg-disclosure-project/
Here is my work - https://ibm.box.com/s/vmyitcackqevvm1hcxv7wke6gudrpnce

14. INSURANCE RISK MITIGATION
Global insured losses from natural catastrophes surged in the first half of 2021 to $42 billion, the second-highest amount since 2011.
The preliminary estimate from Zurich-based reinsurer Swiss Re attributed the high loss total to winter storms, intense heatwaves, and severe flooding across the
world.
The insured loss total exceeded the previous ten-year average (2011-2020) of $33 billion. It was second only to the losses in the first half of 2011, when the Great
East Japan earthquake and tsunami and the Christchurch, New Zealand earthquake pushed the six-month total to $104 billion.
A big contributor in the first half of 2021 was February’s winter storm Uri, a period of extreme cold combined with heavy snowfall and ice accumulation in the
United States. The event took the lives of 164 people, 151 of those in Texas, and triggered estimated insured losses of $15 billion.
Close to 4,500 people lost their lives or went missing in first-half disaster events.
Martin Bertogg, Head of Cat Perils at Swiss Re, said: “The effects of climate change are manifesting in warmer temperatures, rising sea levels, more erratic
rainfall patterns, and greater weather extremes. Taken together with rapid urban development and accumulation of wealth in disaster-prone areas, secondary perils,
such as winter storms, hail, floods, or wildfires, lead to ever-higher catastrophe losses. … The insurance industry needs to upscale its risk-assessment capabilities
for these lesser monitored perils to maintain and expand its contribution to financial resilience.“
https://www.cfo.com/risk-management/2021/08/weather-catastrophes-drive-near-record-insured-losses/
Here are additional links:
New Insurance reporting standard - https://ibm.box.com/s/mgtzq1mp1h4dxk5ei4ov1tr7dgoyn76e
Risk Mitigation - https://www.slideshare.net/paulyoungcga/how-to-mitigate-geopolitical-risks-as-part-of-safeguarding-your-assets-249988353

15. CRISIS MANAGEMENT (HOW TO BEST
SAFEGUARD ASSETS)
Both the public and private sectors are impacted by geopolitical events. It is very important for both the public and
private sectors to have audited crisis and emergency management processes and procedures as part of safeguarding
their assets through better crisis, risk, and emergency management reporting.
Here is my work: https://ibm.box.com/s/rsp6p9tez8uru9fo0wu5d13bxt7rtrr0

16. GOVERNANCE MODEL
Governments at federal, state, and local government need to revisit their governance model to put more emphasis
on the following areas:
1. Ethics
2. Accountability and oversight through more performance audits
3. Mitigation of geopolitical events and other areas of risk management
4. Safeguarding assets from threats like cybersecurity and climate change
Source - https://www.slideshare.net/paulyoungcga/how-to-fix-the-goverance-model-for-the-public-sector-government-
249736146

17. ISSUES FACING ALL LEVEL OF
GOVERNMENTS
• Tax fairness
• Ability to deliver program spending with value for money
• Funding of liabilities like healthcare
• Infrastructure gaps
• Urban planning
• Economic development
• Access to affordable housing
All levels of governments will need to revisit their policies as part of addressing the above issues.