Financial Highlights: Statement of Net Cost
The Statement of Net Cost presents the USPTO’s results of operations by Patent and Trademark business areas. The following table presents the total USPTO’s results of operations for the past four fiscal years.
|
FY 2002
|
FY 2003
|
FY 2004
|
FY 2005
|
|
|---|---|---|---|---|
|
Earned Revenue
|
$ 1,061.4 | $ 1,162.3 | $ 1,239.0 | $ 1,372.8 |
|
Program Cost
|
(1,161.0) |
(1,206.1) |
(1,289.2) |
(1,424.0) |
|
Net Cost
|
$ 99.6 |
$ 43.8 |
$ 50.2 |
$ 51.2 |
The Statement of Net Cost compares fees earned to costs incurred during a specific period of time. It is not necessarily an indicator of net income or net cost over the life of a patent or trademark. Net income or net cost for the fiscal year is dependent upon the groups of work that have been completed over the various phases of the production life cycle. The net income calculation is based on fees earned during the fiscal year being reported, regardless of when those fees were collected. Maintenance fees play a large part in whether a total net income or net cost is recognized. Maintenance fees collected in FY 2005 are a reflection of patent issue levels 3.5, 7.5, and 11.5 years ago, rather than a reflection of patents issued in FY 2005. Therefore, maintenance fees can have a significant impact on matching costs and revenue. For example, in order to reduce the net cost associated with the patent business line to zero, maintenance fees collected would have needed to be 13.2 percent greater — and the desire to maintain a patent is in the hands of the patent holder and not within the influence of the USPTO. Another example is that first action pendency would have needed to increase by only 0.5 months, instead of 0.9 months, without incurring any related increase in costs.
From FY 2002 through FY 2005, the USPTO’s operations resulted in a net cost. However, in FY 2005, due to changes in the fee schedule and continued increases in filings, the USPTO net cost of operations only increased $1.0 million.
