Data Dictionary

Item Number J653
GOLD CERTIFICATE ACCOUNT

Call confidentiality applies to FFIEC 031/041.

Series Start Date End Date Confidential? Reporting Forms
FRBSJ653 1989-12-31 9999-12-31 Yes FR 34

Data Description:

The Secretary of the Treasury is authorized to issue gold certificates to the Reserve Banks to monetize gold held by the U.S. Treasury. At any time, the U.S. Treasury may reacquire the gold certificates by demonetizing the gold.

The Treasury of the United States maintains an account with the Board of Governors entitled "Gold certificate fund--Board of Governors of the FR System." When the Treasury monetizes gold, it credits this account in return for deposit credit at the New York Reserve Bank. When demonetizing gold, Treasury decreases the account and authorizes New York to charge its deposit account. The offsetting entry in each case on New York's books is made to the Gold Certificate account and the U.S. Treasury - general account. New York accounting staff sends an advice of these entries to the Board. Also, whenever the official price of gold is changed, Treasury adjusts the account and, simultaneously, the deposit account.

The Board maintains the account in the exact amount as shown on Treasury's books at all times. The entries are made pursuant to advice from the New York Reserve Bank and Treasury. The amount of gold certificates on each Bank's balance sheet must agree with the total in the Board's records and is periodically confirmed by auditors. Monthly statements of the account are received from Treasury and confirmed by the RBOPS FRB Financial Accounting Section.

The Board distributes substantially all of the total among Reserve Banks based on the net Federal Reserve note liabilities. The undistributed amount is allocated to the New York Reserve Bank as a cushion for sales by Treasury. By law, each Bank may pledge all or any part of its account with the Federal Reserve Agent as security for Federal Reserve notes. Prior to 1978, each Bank pledged a specific amount which was then earmarked in the Board's records on a separate ledger sheet, and thereafter was subject to and reduced only with prior approval from the Assistant Federal Reserve Agent. Beginning in 1978, each Bank's holdings were pledged automatically pursuant to a continuing agreement. The amount of gold certificates pledged with the Agent--currently the same as the balance sheet total at each Bank--is reported on the Daily Statement of the Federal Reserve Agent, Form FR 5 and is also confirmed periodically. The gold certificate account serves as the medium for affecting an annual settlement among the Reserve Banks for amounts accumulated in the Interdistrict Settlement account. Following such settlement, annually, each Bank's gold certificate account is restored relative to the net Federal Reserve note liabilities through a reallocation of securities in the System Open Market Account.

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Last update: Oct 12, 2018