gasb-issues-statement-no-78-new-pension

The Governmental Accounting Standards Board (GASB) issued Statement No. 78, which provides guidance on accounting by small governments for pensions that are provided through multi-employer plans.

According to the official GASB News Release dated December 11, 2015:

During the implementation of GASB Statement No. 68Accounting and Financial Reporting for Pensions, stakeholders raised concerns regarding the inability of a small group of governments whose employees are provided pensions through such multiple-employer pension plans to obtain measurements and other relevant data points needed to comply with the requirements of that Statement.

GASB Chairman David A. Vaudt said, "This new guidance removes an impediment to complying with the GASB’s financial reporting requirements for governments participating in certain multiple-employer defined benefit pension plans. It also promotes enhanced consistency among those applying the standards.’”

The requirements of this Statement are effective for reporting periods beginning after December 15, 2015, with earlier application encouraged, and allows smaller governments to provide disclosures based on information that is more readily available to them.

What does this mean for the CPA Exam? 

CPA Exam students taking FAR are expected to recall the disclosure requirements for the notes to the basic financial statements of state and local governments. This is specifically required in the 2017 Exam blueprint. 

Want more information? Read the full Statement No. 78 on the GASB Website.