Final Guide Issued
In November 2017, the Governmental Accounting Standards Board (GASB) approved a final Implementation Guide related to Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions. The document, known as Implementation Guide No. 2017-3, provides authoritative guidance (Category B generally accepted accounting principles) in a question-and-answer format as well as nonauthoritative illustrations. The Guide will assist governments in implementing the new standard related to their other post-employment benefit (OPEB) obligations.
The final Implementation Guide contains approximately 500 questions covering topics including scope and applicability, types of OPEB, actuarial valuations, defined benefit OPEB not provided through a trust and defined contribution OPEB. However, the questions are organized by type of OPEB so questions related to cost-sharing employers, for example, are grouped together.
Many of the questions in the Guide are similar to those in the Implementation Guide for GASB Statement 68, Accounting and Financial Reporting for Pensions, because there are many similarities in the provisions in GASB 68 and GASB 75. However, there are topics unique to OPEB such as determining the substantive plan (because many OPEB plans do not have written plan documents like pensions often do), estimating the health care cost trend rate (an important factor in OPEB calculations but not relevant for pensions) and the alternative measurement method available for providers of very small OPEB plans (not available for pensions).
The illustrations can help governments in making the calculations, journal entries and disclosures necessary to implement the standard. They include determining the discount rate when a blended rate is required, example disclosures and required supplementary information tables.
GASB 75 is effective for reporting periods beginning after June 15, 2017. Most of Implementation Guide 2017-3 is effective at the same time. However, there are a few questions identified in the Guide as being effective for actuarial valuations beginning December 15, 2017, and others that are effective for the first reporting period in which the measurement date of the (collective) net OPEB liability is on or after June 15, 2018. These exceptions are noted in the Effective Date and Transition of This Implementation Guide section on page 145.
For more information, view BKD articles, “GASB Issues Final Rules Governing Reporting for Postemployment Benefits Other Than Pensions” and “GASB Proposes OPEB (Statement 75) Implementation Guidance” and BKD webinar, “Implementing GASB 75: What You Need to Know” or contact your BKD advisor.