AICPA Publishes New Technical Questions and Answers
The following Technical Questions and Answers guidance was issued by the American Institute of Certified Public Accountants (“AICPA”) under Section 9160, Other Reporting Issues: Section 9160.31, Following Accounting Standards as Promulgated by FASB by a State or Local Governmental Entity. Section 9160.31 covers how an auditor should decide whether a government entity is following the applicable accounting standards. Section 9160.32, Reporting on Accounting Standards as Promulgated by FASB by a State or Local Government. Section 9160.32 offers guidance on how an auditor should report on a government entity’s financial statements, when the entity prepares its financial statements under the Financial. Read More.
Topics: AICPA, American Institute of Certified Public Accountants "AICPA", FASB, Financial Accounting Standards Board "FASB", GASB, Governmental Accounting Standards Board "GASB", state and local governments, Technical Questions & Answers, U.S. GAAP
GASB Issues Exposure Draft on Debt Disclosures
On Wednesday, the Governmental Accounting Standards Board (“GASB”) released an exposure draft that proposes guidance to improve debt-related disclosures in financial statements. Issued as Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements , the Exposure Draft offers guidance that would state which liabilities governments must disclose in their financial statements. Such liabilities include direct borrowings and direct placements. The proposed guidance would describe debt for disclosure purposes as a liability arising from a contractual requirement to pay cash or other assets to resolve a fixed amount at the date of the established contractual obligation. Leases and trade accounts payable would receive exemption from the guidance. In addition, the new. Read More.
New GASB Statement on Leases Issued
The Governmental Accounting Standards Board (“GASB”) has issued a new single model to help state and local governments report leasing agreements. GASB Statement (“GASBS”) No. 87, Leases, categorizes leases as financing arrangements that allow customers to use the leased asset. Per the standard, governments that act as lessees must report a liability for the contract, as well as report an intangible asset indicating their ability to use the leased item. For government entities that are lessors, they must disclose a receivable for the lease and a deferred inflow of resources. Nonfinancial assets such as vehicles, heavy equipment, and property are. Read More.
GASB Chairman Offers Financial Reporting Model Update
In his “From the Chairman” column for the latest GASB Outlook newsletter, Governmental Accounting Standards Board (“GASB”) Chairman David Vaudt provides an update to the financial reporting model. Vaudt discusses what the GASB has done since issuing an Invitation to Comment last year, such as holding five public hearings and providing updates around the country. He also mentions the GASB’s plans this summer to redeliberate feedback from stakeholders and the public hearings. Vaudt’s “From the Chairman” column can be read at GASB.org.
GASB Newsletter Discusses New Leases Standard
In its latest newsletter, GASB Outlook, the Governmental Accounting Standards Board (“GASB”) highlights the board’s forthcoming standards on lease accounting. Expected to be issued later this month, the new standard is necessary due to the current leasing guidance predating the GASB. The existing guidance also does not consider the conceptual framework, such as the definitions of assets and liabilities. Further, the new guidance will eliminate the distinction between operating and capital leases by handling all leases as financings. The lease standard will be effective for reporting periods starting after December 15, 2019. Read the full newsletter article on GASB.org.
GASB to Issue Debt Disclosures Exposure Draft
An Exposure Draft by the Governmental Accounting Standards Board (“GASB”) is on the way covering debt disclosures. The Exposure Draft, Debt Disclosures, including Direct Borrowing, addresses concerns over the consistency of direct borrowing disclosures by government entities. As a result, the GASB has proposed a definition of “debt” to differentiate it from other long-term liabilities in the footnotes of financial statements. The Exposure Draft is expected to be approved later this month, and will have a 90-day comment period. A final GASB Statement is scheduled for next spring. Further details on the Exposure Draft are available on GASB.org.