FASAB proposes property, plant, equipment implementation guidance

BY KEN TYSIAC

A Federal Accounting Standards Advisory Board (FASAB) committee is seeking comments on its proposed implementation guidance for financial reporting on general property, plant, and equipment cost accumulation, assignment, and allocation.

The release of the exposure draft was announced Friday by Wendy Payne, who chairs FASAB’s Accounting and Auditing Policy Committee (AAPC). The proposal was created to give federal agencies a consistent framework for interpreting existing guidance.

In addition, the proposal is intended to help federal entities correctly apply the general property, plant, and equipment standards and make sure the cost of producing that information does not outweigh the benefits.

The ED proposes implementation guidance for applying FASAB’s standards related to:

  • Recognition requirements related to program costs incurred during the general plant, property, and equipment lifecycle, the required levels of precision, and acceptable methods for recognizing these costs.
  • The concept of a cost accumulation and allocation decision framework.
  • Management’s role in applying the cost accumulation, assignment, and allocation decision framework.

A decision framework is provided to help management apply the principles described in the proposal.

FASAB issued new standards for reporting the effects of general property, plant, and equipment impairments in January.

Comments on the proposed implementation guidance are requested by May 1 and can be submitted by email to fasab@fasab.gov.

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

SPONSORED REPORT

Revenue recognition: A complex effort

Implementing the new standard requires careful judgment. Learn how to make significant accounting judgments and document them and collaborate with peers for consistent application.

VIDEO

How to Excel pivot a general ledger

The general ledger is a vast historical data archive of your company's financial activities, including revenue, expenses, adjustments, and account balances. J. Carlton Collins, CPA, shows how to prepare data for, and mine data with, PivotTables.

QUIZ

News quiz: Taking an economic snapshot and looking to the future

Recent news included IRS actions that affect individuals and partnerships and a possibly influential move by a Big Four accounting firm.Take this short quiz to see how much you know about the news.