Note 7 - Grant Liabilities

Grant liabilities consist of two distinct categories and cover these Agencies: FHWA (Federal Aid and Federal Lands), FMCSA and NHTSA.

The first category is grant related requests for payments that had been billed to an Agency entity as of September 30, but had not yet been paid. The information related to this portion of the grant liability is obtained directly from the DELPHI corporate accounting system as of September 30.

The second category is for grant related costs incurred, but not yet reported (IBNR). IBNR represents an estimate of amounts due to grantees for their expenditures made through September 30, for which payment requests have not been received from grantees as of September 30.

The grant accrual calculation is principally based on the results of studies and grantee surveys conducted by the Agencies. The results of such studies resulted in an average number of days work that would have been incurred but not yet reported to the HTF agency for disbursements. This calculated number of days is multiplied by an amount representing grant disbursements for a particular period of time to determine the amount of the grant liability accrual at year-end.

Grant liabilities by Agency at September 30, 2004 and 2003 are summarized as follows:

Grant Liabilities by Agency at September 30, 2004 and 2003

Agency	2004	2003
FHWA	$2,115,993	$2,353,325
FMCSA	10,268	8,461
NHTSA	69,319	81,805
Total	$2,195,580	$2,443,591