FASAB proposes changes to budget and accrual reconciliation

Reconciliation would be focused on net outlays.

A proposal by the Federal Accounting Standards Advisory Board (FASAB) would amend requirements for a reconciliation between budgetary and financial accounting information established by Statement of Federal Financial Accounting Standards No. 7, Accounting for Revenue and Other Financing Sources and Concepts for Reconciling Budgetary and Financial Accounting.

FASAB is seeking comment on an exposure draft of the proposal, titled Budget and Accrual Reconciliation. The proposal would replace the current reconciliation with a new budget and accrual reconciliation and explain the relationship between the entity's net outlays on a budgetary basis and the net cost of operations during the reporting period, according to a FASAB news release.

Because it focuses the reconciliation on the net outlays instead of the obligations incurred, the new budget and accrual reconciliation would do the following, according to FASAB:

  • Enhance the understandability of the relationship between budgetary resources and the costs of program operations;
  • Simplify the agency's budgetary and financial accounting reconciliation; and
  • Improve the financial reporting.

"This new reconciliation would provide more valuable information to users while enhancing the support to the governmentwide accounting reporting that reconciles net operating cost to the budget deficit," FASAB Chairman Scott Showalter said in the news release.

Comments on the ED are due March 14. The ED and the specific questions raised are available on the FASAB website in PDF and Word formats.

SPONSORED REPORT

Cybersecurity threats proliferating for midsize and smaller businesses

This report details how SMBs can properly protect private information from breaches, design and implement a cybersecurity policy, and create safeguards for training and education.

QUIZ

Test yourself on these often confused words

The spelling checker on your word processing program can do only so much to flag problems. Your best insurance is to learn the troublesome words that trip up writers and use them correctly by the standards of formal, written English.