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Summary of GASB Updates. Effective Dates – Recently Issued GASB Standards June 30, 2012 GASB Statement No. 64, Derivative Instruments: Application of Hedge Accounting Termination Provisions. Summary of GASB Updates. Effective Dates – Recently Issued GASB Standards June 30, 2013

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Summary of GASB Updates

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Summary of gasb updates

Summary of GASB Updates

  • Effective Dates – Recently Issued GASB Standards

    • June 30, 2012

      • GASB Statement No. 64, Derivative Instruments: Application of Hedge Accounting Termination Provisions


Summary of gasb updates1

Summary of GASB Updates

  • Effective Dates – Recently Issued GASB Standards

    • June 30, 2013

      • GASB Statement No. 60, Accounting and Financial Reporting for Service Concession Arrangements*

      • GASB Statement No. 61, The Financial Reporting Entity Omnibus, an amendment of GASB Statements No. 14 and No. 34

      • GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance contained in Pre-November 30, 1989 FASB and AICPA*

      • GASB Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources and Net Position*

        * Effective as of the previous December 31, however effective as of June 30, for the State of Illinois.


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Summary of GASB Updates

  • Effective Dates – Recently Issued GASB Standards

    • June 30, 2014

      • GASB Statement No. 65, Items Previously Reported as Assets and Liabilities*

      • GASB Statement No. 66, Technical Corrections – 2012*

      • GASB Statement No. 67, Financial Reporting for Pension Plans

        * Effective as of the previous December 31, however effective as of June 30, for the State of Illinois.


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Summary of GASB Updates

  • Effective Dates – Recently Issued GASB Standards

    • June 30, 2015

      • GASB Statement No. 68, Accounting and Financial Reporting for Pension Plans


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Summary of GASB Updates

  • GASB Statement No. 64 – Derivative Instruments: Application of Hedge Accounting Termination Provisions (Amendment to GASB No. 53)

    • Establishes criteria as to when hedge accounting should continue after the replacement of a swap counterparty or a swap counterparty’s credit support provider.


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Summary of GASB Updates

  • GASB Statement No. 60 – Service Concession Arrangements (SCAs)

    • Public-Private Partnership in which:

      • The transferor conveys to an operator the right and obligation to provide services through the use of a facility (capital asset) in exchange for significant consideration.

      • The operator is compensated through fees from third parties.

      • The transferor has the ability to determine the services provided by the operator, to whom these services are available and the prices charged for the services.

      • The transferor is entitled to ownership or other significant residual interest in the service utility of the facility at the end of the arrangement.

    • Examples :

      • Parking Garages, Parking Meters, Roads and Bridges


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Summary of GASB Updates

  • GASB Statement No. 61 – The Financial Reporting Omnibus

    • Provides amendments to GASB Statement No. 14, The Financial Reporting Entity relating to component and blended component units:

      • Increases emphasis on financial relationships (i.e. financial benefit or burden) between the primary government and the potential component unit when determining to include or exclude a potential component unit within the financial statements.

      • Expands the blending requirements for component units within the primary government financial statements.

      • Expands footnote disclosures emphasizing the reasons for including a component unit.


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Summary of GASB Updates

  • GASB Statement No. 62 – Codification of Pre-November 30, 1989 FASB and AICPA Pronouncements

    • Primary objective is to directly incorporate the applicable provisions in FASB and AICPA pronouncements issued before November 30, 1989 into the state and local government accounting and financial reporting standards.


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Summary of GASB Updates

  • GASB Statement No. 63 – Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources and Net Position

    • Addresses presentation issues associated with the new financial position elements created in Concepts Statement No. 4 (issued in June 2007).

    • Deferred Outflows of Resources and Deferred Inflows of Resources should only be used as specifically required in authoritative GASB pronouncements:

      • GASB No. 53 – Derivative Instruments

      • GASB No. 60 – Service Concession Arrangements

      • GASB No. 64 – Items Previously Presented as Assets and Liabilities


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Summary of GASB Updates

  • Definitions:

    • Deferred outflow of resources

      • a consumption of net assets by the government that is applicable to a future period.

      • Has a natural “debit” balance and is reported similar to assets.

    • Deferred inflow of resources

      • An acquisition of net assets by the government that is applicable to a future reporting period.

      • Has a natural “credit” balance and is reported similar to liabilities.

    • Net position

      • The residual of all elements presented in a financial position statement.


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Summary of GASB Updates

Reporting Requirements

Balance Sheet

(Governmental Fund Financials)

Assets

Deferred Outflows of Resources

Liabilities

Deferred Inflows of Resources

Fund Balance

Statement of Net Position

(Government-Wide Financials)

  • Assets

  • Deferred Outflows of Resources

  • Liabilities

  • Deferred Inflows of Resources

  • Net Position


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Summary of GASB Updates

  • Reporting Requirements (cont.)

    • Footnote Disclosures –

      • Governments should provide details of different types of deferred amounts in the notes to the financial statements if the deferred inflow/outflow consists of multiple components on the face of the financial statements.


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Summary of GASB Updates

  • GASB Statement No. 65 – Items Previously Reported as Assets and Liabilities

    • Objective is to determine whether certain transactions previously reported as assets and liabilities should continue to be reported as such or should instead be reported as:

      • A deferred outflow of resources, or

      • An outflow of resources (expense/expenditure), or

      • A deferred inflow of resources, or

      • An inflow of resources (revenue).


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Summary of GASB Updates

  • GASB Statement No. 65 – Reporting Examples

    • Deferred Outflows of Resources (debit balance)

      • Grants paid in advance of meeting timing requirements

      • Deferred amounts from refunding of debt (debits)

      • Cost to acquire rights to future revenues (intra-entity)

      • Deferred loss from sale-leaseback

    • Deferred Inflows of Resources (credit balance)

      • Grants received in advance of meeting timing requirement (unavailable revenue within governmental funds)

      • Deferred amounts from refunding of debt (credits)

      • Proceeds from sales of future revenues (GASB No. 48)

      • Deferred gain from sale-leaseback

      • “Regulatory” credits


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Summary of GASB Updates

  • GASB Statement No. 65 – Reporting Examples

    • Assets

      • Grants paid in advance of meeting eligibility requirements (other than timing)

      • Rights to future revenues acquired from outside the reporting entity

    • Liabilities

      • Derived tax revenue received in advance

      • Premium revenues (risk pools)

      • Grants received in advance of meeting eligibility requirements (other than timing)


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Summary of GASB Updates

  • GASB Statement No. 65 – Reporting Examples

    • Outflows of Resources (Expense/Expenditure)

      • Debt issuance costs (other than insurance)

      • Initial costs incurred by lessor in an operating lease

      • Acquisition costs for risk pools

      • Loan origination costs

    • Inflows of Resources (Revenue)

      • Loan origination fees

      • Commitment fees (after exercise or expiration)


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Summary of GASB Updates

  • GASB Statement No. 66 – Technical Corrections – an amendment of GASB Statements No. 10 and No. 62

    • Resolves conflicting guidance surrounding differences in Statements No. 54 and No. 10 regarding the reporting of risk financing activities

    • Resolves differences between Statements No. 62 and No. 13 regarding the reporting of certain operating lease transactions and No. 48 regarding the reporting of the acquisition of a loan or group of loans


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Summary of GASB Updates

  • GASB Statement No. 67 – Financial Reporting for Pension Plans & GASB Statement No. 68 – Accounting and Financial Reporting for Pension Plans

    • Guidance relates to the accounting and financial reporting surrounding how pension costs and obligations are measured and reported in audited external financial reports.

    • Issued in June 2012 – Final GASB Statement to be available in August 2012.


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