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Glenn Hegar  ·  Texas Comptroller of Public Accounts

2011 Changes - Reporting Requirements for Annual Financial Reports of State Agencies and Universities

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Changes for the 2011 Reporting Period

In response to agency requests, identification of problems and new issues raised, the Comptroller’s office made changes to the Reporting Requirements for Annual Financial Reports of State Agencies and Universities. The significant changes are listed below:

  1. The Reporting Requirements for Annual Financial Reports of State Agencies and Universities publication is now in HTML format and compliant with the Americans with Disabilities Act (ADA). This HTML format features:
    • hyperlinks to pages within the Reporting Requirements and to outside websites,
    • a search engine with results that link to the specific pages within the Reporting Requirements website,
    • hover text that provides what acronyms stand for, and
    • an interactive table of contents.

    Except where specifically stated otherwise in this website, all references to “agency” or “agencies” means any agency, university or component unit that has an “agency number.”

  2. GASB 54 is effective for periods beginning fiscal 2011. The statement establishes accounting and financial reporting standards for governmental funds. It establishes criteria for classifying fund balances into specifically defined classifications that comprise a hierarchy based primarily on the extent to which a government is bound to observe constraints imposed upon the use of the resources reported in governmental funds. It also clarifies existing governmental fund type definitions. Some specific changes related to the implementation of GASB 54 are as follows:
    • General ledger accounts for new fund balance classifications and new T-codes were created in USAS for the implementation.
    • General ledger fund balance accounts that existed prior to GASB 54 were inactivated
    • The default fund balance accounts for each of the governmental fund types were changed.
    • A fund balance constraint specific to encumbrances similar to “reserved for encumbrances” will no longer be reported. This does not impact the process of recording encumbrances in USAS for budgetary purposes.
    • Report changes of fund types as a restatement on the operating statement and disclose in Note 14.
  3. GASB 59 is effective for periods beginning in fiscal 2011. This statement amends and improves existing standards regarding financial reporting and disclosure requirements of certain financial instruments and external investment pools. For information regarding:
    • investments in unallocated insurance contracts (amended GASB 25 and GASB 43) and the disclosure of interest rate risk information for debt investment pools (amended GASB 40).
    • the financial guarantee contracts (amended GASB 53).
  4. Changes made to the submission requirements are as follows.
    • The Long-Term Liability Note (LTLN) web application is implemented for reporting fiscal 2011. The Long-Term Liability Note (LTLN) web application will be available in September 2011. This web-based system is used to submit the long-term liabilities disclosures (Note 5).
    • A new web-based system to submit the cash flow statement will be implemented beginning fiscal 2011. The system is currently in the process of being developed. Once the system is available, general information and instructions for the use of the system will be added to the Reporting Requirements’ website. Agencies will be notified of this system availability by notification in FMXtra, in FMX’s “What’s New,” and in the change table located on the Reporting Requirement’s home page. For fiscal 2011, this new system will not reconcile to USAS; rather, it will be a tool to replace the Excel spreadsheet submission for the cash flow statement.
  5. Changes made to SEFA are as follows:
    • Added information on Note 8 – Supplemental Nutrition Assistance Program.
    • A USAS Reconciliation Report will be available in the SEFA web application on Sept. 1, 2011. This report extracts data from USAS for both sending and receiving pass-through agencies and compares USAS to the SEFA database. This report is similar to the USAS Reconciliation Report available in the SPTR web application.
    • Previously when editing an existing record, the old record ID was no longer valid and a new record ID was assigned to the changed record. Beginning in fiscal 2011, when changing an existing record, the SEFA web application will maintain the original record ID.
  6. Changes were made to the reporting of the “paid on behalf payroll-related costs” on the GR reconciliation.

    A summary of the changes are as follows:

    • Lines 400100 (retirement), 400200 (group insurance) and 400300 (unemployment contribution) will no longer be used and therefore will not be populated with amounts from the ERS and TWC reports.
    • Do not enter the amounts for the paid on behalf payroll-related costs into USAS.
    • For agencies that are not universities, refer to the chart below for additional guidance:
      Paid on Behalf Payroll Related Costs GR Recon USAS Audited AFR
      Agencies without audited AFR No No N/A
      Agencies with audited AFR No No Yes
    • For universities, refer to the chart below for additional guidance:
      Paid on Behalf Payroll Related Costs GR Recon USAS Hard Copy AFR
      Universities – Independent Option No Yes
      Universities – Components Option No Yes
      University Systems – Consolidated NA No Yes
  7. Expanded information on the reporting of Derivatives to include more details on what derivatives are, how to record derivatives into USAS and how to report derivatives information in the AFR.
  8. Changes related to the note submissions are as follows:
    • Derivative disclosure will now be made with Note 7.
    • Combined capital lease information previously disclosed in Note 7 with operating lease information in Note 8, and changed the title of Note 8 to “Leases.”
    • Changes related to Note 9 are as follows:
      • Changed the title of Note 9 from “Retirement Plans” to “Pension Plans,” as Note 9 is specifically disclosing pension plans rather than retirement plans.
      • Changed the title of pension schedule 5C to “Contribution Rates,” and
      • Removed the reference to and sample for pension schedule 5E, as the information for that schedule comes directly from the agencies’ actuarial reports rather than from their AFRs.
    • A table format is required when disclosing subsequent event bond issuances in Note 16.
    • Information previously presented in Note 19 regarding the determination for inclusion of outside organizations as component units as well as component unit financial statement presentation is now available in Component Units.
  9. Component universities do not enter USAS entries for state grant interagency pass-throughs made between component universities within the university system. However, component universities must continue to report the state grant interagency pass-throughs within the university system on the SPTR web application.
  10. In USAS, an existing COBJ was revised and a new COBJ was developed to distinguish the issuance of bonds to refund existing bonds payable (COBJ 3870) from the issuance of bonds to refund other outstanding debt (COBJ 3878).
  11. In order to provide consistent reporting of tuition and fee revenue and related exemptions and waivers, universities must adhere to the following guidelines. This methodology was adopted by the TASSCUBO Accounting Principles Committee in 2004 and is still in effect:
    • Tuition exemptions as defined by the Texas Higher Education Coordinating Board (THECB) are to be reported as part of the gross tuition and fee revenues for each university. Since there is no cash collection from these exemptions, the revenue is to be offset by discounts and allowances and/or scholarship expense.
    • Tuition waivers as defined by the THECB are to be excluded from gross tuition and fee revenues of each university and require no offset.
Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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