FASAB establishes concepts for federal agencies’ financial reporting

A new statement issued Friday by the Federal Accounting Standards Advisory Board (FASAB) establishes foundational concepts for federal agencies’ financial reporting.

Statement of Federal Financial Accounting Concepts 8, Federal Financial Reporting, discusses the role of financial statements and required supplementary information and their relationship to other reported financial and nonfinancial information.

The new statement emphasizes the importance of disclosures as an integral part of financial statements. The statement also discusses:

• The content and presentation of financial statements and required supplementary information for governmentwide and component reporting entities.
• The presentation of budgetary information in component reporting entity financial statements and required supplementary information.
• The presentation of performance information in financial statements and required supplementary information.
• The summary-level information relating to financial statements and required supplementary information.

“The identification and explanation of these concepts provides a more progressive platform that will enhance the board’s deliberations going forward,” FASAB Chairman Scott Showalter said in a news release. “The board will have a basis to decide about the types of information and methods needed to inform users of the government’s operating performance, stewardship, and budgetary integrity.”

—Ken Tysiac (Kenneth.Tysiac@aicpa-cima.com) is a JofA editorial director.