Journal of Accountancy Large Logo
ShareThis
|
FINANCIAL REPORTING

GASB makes fix in pension standard transition

 

By Ken Tysiac
November 25, 2013

GASB on Monday altered the transition provisions of a new pension standard in order to eliminate a potential source of understatement.

The board determined that the transition requirements of GASB Statement No. 68, Accounting and Financial Reporting for Pensions, contained a potential source of understatement of restated beginning net position and expense in a government’s first year of implementation.

GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date, is designed to correct the potential understatement. Statement No. 71 requires a state or local government that is transitioning to the new standards to recognize a beginning deferred outflow of resources for its pension contributions made between the measurement date of the beginning net pension liability and the beginning of the initial fiscal year of implementation.

State and local governments will be required to recognize this amount regardless of whether it is practical to determine the beginning amounts of all other deferred outflows and deferred inflows of resources related to pensions.

The provisions take effect simultaneously with Statement No. 68, which is required to be applied in fiscal years beginning after June 15, 2014.

Ken Tysiac (ktysiac@aicpa.org) is a JofA senior editor.

View CommentsView Comments   |  
Add CommentsAdd Comment   |   ShareThis

RELATED TOPICS

CPE Direct articles Web-exclusive content
AICPA Logo Copyright © 2013 American Institute of Certified Public Accountants. All rights reserved.
Reliable. Resourceful. Respected. (Tagline)