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Standard Issued for Certain Multiple-Employer Pension Plans

The Governmental Accounting Standards Board (“GASB”) has issued GASB Statement (GASBS) No. 78, Pensions Provided Through Certain Multiple-Employer Defined Benefit Pension Plans, to assist participants of some private or federal multiple-employer pension plans. Addressing the employer accounting and financial reporting disclosures for pension plans, the standard is intended to help state or local governments participating in multi-employer plans with the implementation of GASBS No. 68, Accounting and Financial Reporting for Pensions.

GASBS No. 78 excludes several pensions available to governmental employees through a cost-sharing, multiple-employer pension plan from applying GASBS No. 68. The GASB said the exclusion is necessary due to some governments in multi-employer plans are unable to obtain the required measurements for preparing financial statements. To be eligible for the exclusion, a pension plan:

  • Cannot be a state or local government plan;
  • Must be used to provide defined benefit pensions to government and nongovernment employees; and
  • Cannot be dominated by one or more government participants.

GASBS No. 78 is effective for financial statements for periods beginning after December 15th, but the state and local governments are encouraged to apply the standard early.

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