Financial Highlights: Results of Operation
T he slow growth in total budgetary resources available for use has had a direct impact on the gross costs of USPTO operations. Gross cost of operations increased 11.6 percent and 14.2 percent in fiscal years 2001 and 2002 respectively, but only increased 6.9 percent in fiscal year 2004.
Due to the increase in pendency, the time it takes to process a patent or trademark, the USPTO has been recognizing a steadily increasing deferred revenue liability for fees received prior to the revenue being earned. From fiscal year 2001 through fiscal year 2004, patent unearned fees increased 50.7 percent, with only a 10.3 percent increase from fiscal year 2003 to fiscal year 2004. In fiscal year 2004, for each month that patent pendency to first action increased, deferred revenue increased approximately $26.2 million, with a corresponding decrease in earned revenue. From fiscal year 2001 through fiscal year 2004, trademark unearned fees increased $38.8 million, primarily due to a change in the methodology used to calculate deferred revenue. In the future, in order to reduce the backlog of unprocessed applications and reduce pendency, additional budgetary resources will be required.