Industry Insights

GASB’s Proposed Implementation Guidance, Pension Amendments & Cost-Benefit Analysis of OPEB Standards

November 2015

In September 2015, the Governmental Accounting Standards Board (GASB) issued a proposed implementation guide designed to clarify recent pronouncements. It contains questions and answers explaining or elaborating on recent GASB statements, focusing on fair value reporting, basic financial statements, management discussion and analysis and pensions. It also addresses a variety of practice issues brought to GASB’s attention. Requirements of the implementation guide apply to financial statements of all state and local governments unless the guide specifically provides narrower applicability in the pronouncement addressed by a question and answer. Stakeholders are encouraged to review and provide comments by November 30, 2015.

The requirements would be effective for reporting periods beginning after June 15, 2016, with earlier application permitted. Governmental entities would apply the accounting changes adopted to retroactively conform to the provisions of the implementation guide by restating financial statements, if practical, for all prior periods presented. Additional implementation guidance is given.

In October 2015, GASB issued an exposure draft, Accounting and Financial Reporting for Pensions Provided through Certain Multiple-Employer Defined Benefit Pension Plans - an amendment of GASB Statement No. 68. The proposed amendment narrows the scope and applicability of GASB Statement No. 68 to exclude pensions provided to employees of state or local governmental employers through a cost-sharing multiple-employer defined benefit pension plan that meets certain criteria. It would establish separate standards for employers that participate in pension plans that meet criteria set forth in the proposal, as well as separate requirements for recognition and measurement of pension expense/expenditures and liabilities, note disclosures and required supplementary information. The requirements of the proposed statement would be effective for reporting periods beginning after December 15, 2015.

Also in October 2015, GASB published Understanding Costs and Benefits:  Other Postemployment Benefits, analyzing whether Statements 74 and 75, issued in June 2015, meet GASB’s objective of improving the usefulness of reported financial information for decision making and assessing government accountability and whether these improvements justify the net costs imposed on financial statement preparers, auditors and users. Ultimately, GASB concluded the costs of implementing the new OPEB standards are justified by the improved usefulness and enhanced value of information required.


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