industry considerations u.s. government funding constraints the u.s. government , our principal customer , continues to face significant fiscal and economic challenges such as financial deficits , budget uncertainty , increasing debt levels , and an economy with restrained growth . in order to address these challenges , the u.s. government continues to focus on discretionary spending , entitlement programs , taxes , and other initiatives to stimulate the economy , create jobs , and reduce the deficit . in doing so , the administration and congress must balance decisions regarding defense , homeland security , and other federal spending priorities in a constrained fiscal environment largely imposed by the budget control act of 2011 ( budget control act ) . the budget control act established limits on discretionary spending , which provided for reductions to planned defense spending of $ 487 billion over a 10 year period that began with government fiscal year ( gfy ) 2012 ( a u.s. government fiscal year starts on october 1 and ends on september 30 ) . the budget control act also provided for additional automatic spending reductions , known as sequestration , which went into effect on march 1 , 2013 , that would reduce planned defense spending by another $ 500 billion over a nine-year period that began in gfy 2013. these additional spending reductions are arbitrary as they would be applied across-the-board to numerous programs and contracts without regard to national priorities . while the defense budget will sustain the largest single reduction , other civil agencies and programs are also impacted by significant spending reductions . in light of the budget control act and deficit reduction pressures , it is likely that discretionary spending by the u.s. government will remain constrained for a number of years . 1 we define free cash flow as cash from operations as determined under u.s. generally accepted accounting principles ( gaap ) , less capital expenditures as presented on our statements of cash flows . 24 for gfy 2013 , which ended on september 30 , 2013 , sequestration resulted in a $ 37 billion reduction to the defense budget in addition to reductions as a result of the discretionary spending limits already imposed under the budget control act . the impacts of sequestration in gfy 2013 were less than originally expected due to congressional actions that reduced the cuts as well as the dod 's ability to allocate a portion of the reductions to prior year unobligated balances and multi-year investment appropriations . accordingly , we have experienced minimal impacts to date . in december 2013 , congress and the administration enacted the bipartisan budget act of 2013 ( bipartisan budget act ) . notably , the bipartisan budget act increased the limits on discretionary spending for gfy 2014 and gfy 2015 imposed by the budget control act , among other fiscal changes . in particular , the bipartisan budget act allows for approximately $ 63 billion of additional funding , including approximately $ 22 billion and $ 9 billion for defense spending during gfy 2014 and gfy 2015 , respectively , and similar amounts for nondefense programs over the same period . the revised defense spending limits are set at approximately $ 520 billion for gfy 2014 and approximately $ 521 billion for gfy 2015. this agreement allows for more certainty in the budget planning process and provides the dod the flexibility to better address its priorities . however , the bipartisan budget act retains the lower spending limits , including the across-the-board spending reduction methodology , for gfys 2016 through 2021 as provided for in the budget control act . as a result , there remains uncertainty regarding how sequester cuts beyond gfy 2015 will be applied as the dod and other agencies may have significantly less flexibility regarding how to allocate cuts in future years . while we have not yet seen the specific budget allocations by program , we continue to believe that our portfolio of products will continue to be well supported in a strategically focused allocation of budget resources . on january 17 , 2014 , the u.s. government passed its gfy 2014 budget to finance all activities through september 30 , 2014 , the end of its current fiscal year , after operating under continuing resolution temporary funding measures from october 1 , 2013 to january 18 , 2014. the budget provides discretionary defense spending at levels consistent with the planned defense spending limits in the bipartisan budget act and eliminated much of the uncertainty and inefficiency in procuring products and services under the continuing resolution . under continuing resolutions , partial-year funding is available at prior year levels , subject to certain restrictions , but new spending initiatives are not authorized . other matters while the recent budget actions provide a more measured and strategic approach to addressing the u.s. government 's fiscal challenges , sequestration remains a long-term concern . if not further modified , sequestration could have significant negative impacts on our industry and company in future periods . there may be disruption of ongoing programs , impacts to our supply chain , contractual actions ( including partial or complete terminations ) , potential facilities closures , and thousands of personnel reductions across the industry that will severely impact advanced manufacturing operations and engineering expertise , and accelerate the loss of skills and knowledge . sequestration , or other budgetary cuts in lieu of sequestration , could have a material negative effect on our company as would any failure to address issues raised by the debt ceiling . additionally , we are seeking to lessen our dependence on contracts with the u.s. government by focusing on expanding into adjacent markets close to our core capabilities and growing international sales but may not be successful in this strategy . story_separator_special_tag services sales decreased about $ 40 million at is & gs primarily due to the substantial completion of the outsourcing desktop initiative for nasa ( odin ) during 2011 and lower volume on the hanford mission support ( hanford ) contract , partially offset by higher net sales from qtc , which was acquired in the fourth quarter of 2011. cost of sales cost of sales , for both products and services , consist of materials , labor , and subcontracting costs , as well as an allocation of indirect costs ( overhead and general and administrative ) . for each of our contracts , we monitor the nature and amount of costs at the contract level , which form the basis for estimating our total costs at the completion of the contract . our consolidated cost of sales were as follows ( in millions ) : replace_table_token_6_th due to the nature of percentage-of-completion accounting , changes in our cost of products and services sales are typically accompanied by changes in our net sales . the following discussion of material changes in our consolidated cost of products and services sales should be read in tandem with the preceding discussion of changes in our consolidated net sales and with our business segment results of operations section . we have not identified any developing trends in cost of products and services sales that would have a material impact on our future operations . 29 cost of products sales cost of products sales decreased $ 2.1 billion , or 6 % , in 2013 compared to 2012 primarily due to lower volume and deliveries . cost of products sales decreased about $ 770 million at aeronautics due to fewer aircraft deliveries ( primarily f-16 and c-130 ) and lower volume ( primarily f-22 ) , partially offset by increased volume for f-35 production contracts , increased aircraft deliveries and the impact of reducing the profit booking rate in the third quarter of 2013 for the c-5 program and lower risk retirements on various programs ( primarily c-130 ) ; about $ 685 million at is & gs for various programs primarily due to decreased volume ; about $ 570 million at mst primarily due to fewer deliveries and net increased risk retirements for the ptds program and various integrated warfare systems and sensors programs and for the favorable resolution of certain contract cost matters ( including the terminated presidential helicopter program ) ; and about $ 315 million at space systems due to lower volume ( primarily commercial satellites and orion ) . the decreases were partially offset by higher cost of products sales of about $ 190 million at mfc due to increased volume ( primarily thaad and deliveries of pac-3 ) , partially offset by various other programs due increased risk retirements ( primarily fire control programs ) . the 0.8 % decrease in the percentage of cost of products sales relative to products sales in 2013 compared to 2012 primarily was due to higher risk retirements ( primarily at mfc and mst ) and the favorable resolution of contractual matters at mst . cost of products sales increased $ 527 million , or 2 % , in 2012 compared to 2011 primarily due to higher volume and deliveries . cost of products sales increased about $ 520 million at aeronautics due to increased volume ( primarily f-35 production contracts ) and increased deliveries ( primarily f-16 and c-5 ) ; about $ 485 million at mst due to increased deliveries ( primarily ptds ) and volume ( primarily lcs ) , partially offset by reserves of about $ 55 million for contract cost matters on certain contracts recorded in the fourth quarter of 2011 ( including the terminated presidential helicopter program ) ; and about $ 180 million at space systems due to increased volume ( primarily commercial satellites programs , orion and various strategic and defensive missile programs ) . the increases were partially offset by lower cost of products sales of about $ 530 million at is & gs primarily due to the substantial completion of various programs during 2011 and lower volume on various other programs ; and about $ 70 million at mfc due to higher risk retirements ( primarily tactical missile and fire control programs ) and the favorable resolution of contractual matters , partially offset by increased deliveries ( pac-3 ) and volume ( thaad ) . the 0.7 % decrease in the percentage of cost of products sales relative to products sales in 2012 compared to 2011 primarily was due to higher risk retirements ( primarily at mfc ) as well as the favorable resolution of contractual matters at mfc and higher risk retirements and lower reserves on ship and aviation system programs at mst . cost of services sales our cost of services sales increased $ 205 million , or 2 % , in 2013 compared to 2012. most of our cost of services sales are in the is & gs and mfc business segments . the increase in cost of services sales was primarily attributable to higher cost of services sales at our is & gs and aeronautics business segments partially offset by lower cost of services sales at our mfc business segment . cost of services sales increased about $ 245 million at is & gs primarily due to the start-up of various programs . cost of services sales increased about $ 40 million at aeronautics primarily due to increased sustainment activities ( primarily f-16 ) . cost of services sales decreased about $ 75 million at mfc primarily due to lower volume of various technical services programs , partially offset by higher volume from various fire control programs ( primarily sof clss ) . the 0.7 % decrease in the percentage of cost of services sales relative to services sales in 2013 compared to 2012 was primarily due to higher risk retirements on sustainment contracts at aeronautics . our

liquidity and cash flows we have a balanced cash deployment strategy to enhance stockholder value and position ourselves to take advantage of new business opportunities when they arise . consistent with that strategy , we have invested in our business , including capital expenditures and independent research and development , returned cash to stockholders through dividends and share repurchases , made selective acquisitions of businesses , and managed our debt levels . we have generated strong operating cash flows , which have been the primary source of funding for our operations , debt service and repayments , capital expenditures , dividends , share repurchases , acquisitions , and postretirement benefit plan funding . we have accessed the capital markets on limited occasions , as needed or when opportunistic . our cash balances and cash from operations have historically been sufficient to support our operations and anticipated capital expenditures for the foreseeable future . however , our liquidity and cash flows could be materially impacted in the future if the u.s. government were to shut down due to impasses over budget and or debt ceiling negotiations . as discussed in the capital resources section , we have financing resources available to fund potential cash outflows that are less predictable or more discretionary , should they occur . we also have access to the credit markets , if needed , for liquidity or general corporate purposes , including , but not limited to , our revolving credit facility or the ability to issue commercial paper and letters of credit to support customer advance payments and for other trade finance purposes such as guaranteeing our performance on particular contracts . cash received from customers , either from the payment of invoices for work performed or for advances in excess of costs incurred , is our primary source of cash . we generally do not begin work on contracts until funding is appropriated by the customer . billing timetables and payment terms on our contracts vary based on a number of factors , including the contract type .


 Write a concise suspicious activity report of the following text delimited by triple backquotes. Return your response as a formal report which covers the key points highlighting the location,dates,entity names and account holder information in chronological order of the text.
     ```liquidity and cash flows we have a balanced cash deployment strategy to enhance stockholder value and position ourselves to take advantage of new business opportunities when they arise . consistent with that strategy , we have invested in our business , including capital expenditures and independent research and development , returned cash to stockholders through dividends and share repurchases , made selective acquisitions of businesses , and managed our debt levels . we have generated strong operating cash flows , which have been the primary source of funding for our operations , debt service and repayments , capital expenditures , dividends , share repurchases , acquisitions , and postretirement benefit plan funding . we have accessed the capital markets on limited occasions , as needed or when opportunistic . our cash balances and cash from operations have historically been sufficient to support our operations and anticipated capital expenditures for the foreseeable future . however , our liquidity and cash flows could be materially impacted in the future if the u.s. government were to shut down due to impasses over budget and or debt ceiling negotiations . as discussed in the capital resources section , we have financing resources available to fund potential cash outflows that are less predictable or more discretionary , should they occur . we also have access to the credit markets , if needed , for liquidity or general corporate purposes , including , but not limited to , our revolving credit facility or the ability to issue commercial paper and letters of credit to support customer advance payments and for other trade finance purposes such as guaranteeing our performance on particular contracts . cash received from customers , either from the payment of invoices for work performed or for advances in excess of costs incurred , is our primary source of cash . we generally do not begin work on contracts until funding is appropriated by the customer . billing timetables and payment terms on our contracts vary based on a number of factors , including the contract type .
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 Suspicious Activity Report : industry considerations u.s. government funding constraints the u.s. government , our principal customer , continues to face significant fiscal and economic challenges such as financial deficits , budget uncertainty , increasing debt levels , and an economy with restrained growth . in order to address these challenges , the u.s. government continues to focus on discretionary spending , entitlement programs , taxes , and other initiatives to stimulate the economy , create jobs , and reduce the deficit . in doing so , the administration and congress must balance decisions regarding defense , homeland security , and other federal spending priorities in a constrained fiscal environment largely imposed by the budget control act of 2011 ( budget control act ) . the budget control act established limits on discretionary spending , which provided for reductions to planned defense spending of $ 487 billion over a 10 year period that began with government fiscal year ( gfy ) 2012 ( a u.s. government fiscal year starts on october 1 and ends on september 30 ) . the budget control act also provided for additional automatic spending reductions , known as sequestration , which went into effect on march 1 , 2013 , that would reduce planned defense spending by another $ 500 billion over a nine-year period that began in gfy 2013. these additional spending reductions are arbitrary as they would be applied across-the-board to numerous programs and contracts without regard to national priorities . while the defense budget will sustain the largest single reduction , other civil agencies and programs are also impacted by significant spending reductions . in light of the budget control act and deficit reduction pressures , it is likely that discretionary spending by the u.s. government will remain constrained for a number of years . 1 we define free cash flow as cash from operations as determined under u.s. generally accepted accounting principles ( gaap ) , less capital expenditures as presented on our statements of cash flows . 24 for gfy 2013 , which ended on september 30 , 2013 , sequestration resulted in a $ 37 billion reduction to the defense budget in addition to reductions as a result of the discretionary spending limits already imposed under the budget control act . the impacts of sequestration in gfy 2013 were less than originally expected due to congressional actions that reduced the cuts as well as the dod 's ability to allocate a portion of the reductions to prior year unobligated balances and multi-year investment appropriations . accordingly , we have experienced minimal impacts to date . in december 2013 , congress and the administration enacted the bipartisan budget act of 2013 ( bipartisan budget act ) . notably , the bipartisan budget act increased the limits on discretionary spending for gfy 2014 and gfy 2015 imposed by the budget control act , among other fiscal changes . in particular , the bipartisan budget act allows for approximately $ 63 billion of additional funding , including approximately $ 22 billion and $ 9 billion for defense spending during gfy 2014 and gfy 2015 , respectively , and similar amounts for nondefense programs over the same period . the revised defense spending limits are set at approximately $ 520 billion for gfy 2014 and approximately $ 521 billion for gfy 2015. this agreement allows for more certainty in the budget planning process and provides the dod the flexibility to better address its priorities . however , the bipartisan budget act retains the lower spending limits , including the across-the-board spending reduction methodology , for gfys 2016 through 2021 as provided for in the budget control act . as a result , there remains uncertainty regarding how sequester cuts beyond gfy 2015 will be applied as the dod and other agencies may have significantly less flexibility regarding how to allocate cuts in future years . while we have not yet seen the specific budget allocations by program , we continue to believe that our portfolio of products will continue to be well supported in a strategically focused allocation of budget resources . on january 17 , 2014 , the u.s. government passed its gfy 2014 budget to finance all activities through september 30 , 2014 , the end of its current fiscal year , after operating under continuing resolution temporary funding measures from october 1 , 2013 to january 18 , 2014. the budget provides discretionary defense spending at levels consistent with the planned defense spending limits in the bipartisan budget act and eliminated much of the uncertainty and inefficiency in procuring products and services under the continuing resolution . under continuing resolutions , partial-year funding is available at prior year levels , subject to certain restrictions , but new spending initiatives are not authorized . other matters while the recent budget actions provide a more measured and strategic approach to addressing the u.s. government 's fiscal challenges , sequestration remains a long-term concern . if not further modified , sequestration could have significant negative impacts on our industry and company in future periods . there may be disruption of ongoing programs , impacts to our supply chain , contractual actions ( including partial or complete terminations ) , potential facilities closures , and thousands of personnel reductions across the industry that will severely impact advanced manufacturing operations and engineering expertise , and accelerate the loss of skills and knowledge . sequestration , or other budgetary cuts in lieu of sequestration , could have a material negative effect on our company as would any failure to address issues raised by the debt ceiling . additionally , we are seeking to lessen our dependence on contracts with the u.s. government by focusing on expanding into adjacent markets close to our core capabilities and growing international sales but may not be successful in this strategy . story_separator_special_tag services sales decreased about $ 40 million at is & gs primarily due to the substantial completion of the outsourcing desktop initiative for nasa ( odin ) during 2011 and lower volume on the hanford mission support ( hanford ) contract , partially offset by higher net sales from qtc , which was acquired in the fourth quarter of 2011. cost of sales cost of sales , for both products and services , consist of materials , labor , and subcontracting costs , as well as an allocation of indirect costs ( overhead and general and administrative ) . for each of our contracts , we monitor the nature and amount of costs at the contract level , which form the basis for estimating our total costs at the completion of the contract . our consolidated cost of sales were as follows ( in millions ) : replace_table_token_6_th due to the nature of percentage-of-completion accounting , changes in our cost of products and services sales are typically accompanied by changes in our net sales . the following discussion of material changes in our consolidated cost of products and services sales should be read in tandem with the preceding discussion of changes in our consolidated net sales and with our business segment results of operations section . we have not identified any developing trends in cost of products and services sales that would have a material impact on our future operations . 29 cost of products sales cost of products sales decreased $ 2.1 billion , or 6 % , in 2013 compared to 2012 primarily due to lower volume and deliveries . cost of products sales decreased about $ 770 million at aeronautics due to fewer aircraft deliveries ( primarily f-16 and c-130 ) and lower volume ( primarily f-22 ) , partially offset by increased volume for f-35 production contracts , increased aircraft deliveries and the impact of reducing the profit booking rate in the third quarter of 2013 for the c-5 program and lower risk retirements on various programs ( primarily c-130 ) ; about $ 685 million at is & gs for various programs primarily due to decreased volume ; about $ 570 million at mst primarily due to fewer deliveries and net increased risk retirements for the ptds program and various integrated warfare systems and sensors programs and for the favorable resolution of certain contract cost matters ( including the terminated presidential helicopter program ) ; and about $ 315 million at space systems due to lower volume ( primarily commercial satellites and orion ) . the decreases were partially offset by higher cost of products sales of about $ 190 million at mfc due to increased volume ( primarily thaad and deliveries of pac-3 ) , partially offset by various other programs due increased risk retirements ( primarily fire control programs ) . the 0.8 % decrease in the percentage of cost of products sales relative to products sales in 2013 compared to 2012 primarily was due to higher risk retirements ( primarily at mfc and mst ) and the favorable resolution of contractual matters at mst . cost of products sales increased $ 527 million , or 2 % , in 2012 compared to 2011 primarily due to higher volume and deliveries . cost of products sales increased about $ 520 million at aeronautics due to increased volume ( primarily f-35 production contracts ) and increased deliveries ( primarily f-16 and c-5 ) ; about $ 485 million at mst due to increased deliveries ( primarily ptds ) and volume ( primarily lcs ) , partially offset by reserves of about $ 55 million for contract cost matters on certain contracts recorded in the fourth quarter of 2011 ( including the terminated presidential helicopter program ) ; and about $ 180 million at space systems due to increased volume ( primarily commercial satellites programs , orion and various strategic and defensive missile programs ) . the increases were partially offset by lower cost of products sales of about $ 530 million at is & gs primarily due to the substantial completion of various programs during 2011 and lower volume on various other programs ; and about $ 70 million at mfc due to higher risk retirements ( primarily tactical missile and fire control programs ) and the favorable resolution of contractual matters , partially offset by increased deliveries ( pac-3 ) and volume ( thaad ) . the 0.7 % decrease in the percentage of cost of products sales relative to products sales in 2012 compared to 2011 primarily was due to higher risk retirements ( primarily at mfc ) as well as the favorable resolution of contractual matters at mfc and higher risk retirements and lower reserves on ship and aviation system programs at mst . cost of services sales our cost of services sales increased $ 205 million , or 2 % , in 2013 compared to 2012. most of our cost of services sales are in the is & gs and mfc business segments . the increase in cost of services sales was primarily attributable to higher cost of services sales at our is & gs and aeronautics business segments partially offset by lower cost of services sales at our mfc business segment . cost of services sales increased about $ 245 million at is & gs primarily due to the start-up of various programs . cost of services sales increased about $ 40 million at aeronautics primarily due to increased sustainment activities ( primarily f-16 ) . cost of services sales decreased about $ 75 million at mfc primarily due to lower volume of various technical services programs , partially offset by higher volume from various fire control programs ( primarily sof clss ) . the 0.7 % decrease in the percentage of cost of services sales relative to services sales in 2013 compared to 2012 was primarily due to higher risk retirements on sustainment contracts at aeronautics . our

