AICPA Expresses Concern about GASB Proposed Standards for Post-Employment Benefits  

Published October 23, 2014

In its efforts to reexamine financial accounting and reporting for pensions and other post-employment benefits (OPEB), the Governmental Accounting Standards Board (GASB) issued three Exposure Drafts (EDs) that address OPEB Plans (OPEB Plan ED), governmental employers that offer OPEB benefits (OPEB Employer ED), and pension plans administered outside of a trust (Non-Trust Pension ED).

In its September 23 letter responding to the OPEB EDs, the AICPA’s State and Local Government Expert Panel  expressed its support of the Board’s view that employers should reflect an OPEB liability in their financial statements.  However, the Expert Panel voiced concerns similar to those raised by the American Institute of CPAs in letters responding to previous GASB pension due process documents.  The Panel wrote it is concerned that the OPEB Plan ED is flawed since it lacks essential information in the basic financial statements such that employers participating in multiple-employer defined benefit OPEB plans are provided with the additional information they need to prepare their own financial statements.  The Panel's letter also strongly encouraged the Board to delay the effective dates on the Plan and Employer Statements by one year to allow more time for governments to read, understand and coordinate efforts to comply with the new reporting.  Finally, the letter cited numerous other concerns and made related recommendations on the OPEB Plan ED and the OPEB Employer ED.

The Panel also provided comments on the Non-Trust Pension ED in a separate September 23 letter.  While the Panel largely agreed with the overall tenets of the ED and its alignment to the current pension standards, a number of concerns specific to a non-trust arrangement were raised.




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