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Glenn Hegar  ·  Texas Comptroller of Public Accounts

2014 Changes - Reporting Requirements for Annual Financial Reports of State Agencies and Universities

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Changes for the 2014 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 incorporated into the reporting requirements as of the July 3, 2014, publication date are listed below.

If you need additional information or clarification on any of the GASB statements mentioned below, you may purchase a copy of the statement from the GASB store or download the PDF version for free from GASB’s Pronouncements page.

  1. GASB 65 (effective as of fiscal 2014):
    • Reclassifies certain items (previously reported as assets and liabilities) to deferred outflows of resources or outflows of resources, or deferred inflows of resources or inflows of resources.
    • Recognizes certain items (previously reported as assets and liabilities) as outflows of resources or inflows of resources.
    • The use of the term “deferred” is only used when referring to “deferred inflow of resources” or “deferred outflow of resources.” As a result, “deferred revenue” is now “unearned revenue” and “deferred costs” is now “prepaid costs.”
    • Provides other financial reporting guidance related to the impact of the financial statement elements deferred outflow of resources and deferred inflow of resources (such as changes in the major fund calculation and use of the term “deferred”).
  2. GASB 66 (effective as of fiscal 2014):
    • Resolves conflicting guidance that resulted from the issuance of GASB Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions, and GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements.
    • Amends GASB Statement No. 10, Accounting and Financial Reporting for Risk Financing and Related Insurance Issues, by removing the provision that limits fund-based reporting of a government’s risk financing activities to the general fund and the internal service fund type.
    • Amends GASB 62 by modifying the specific guidance on accounting for:
      • Operating lease payments that vary from a straight-line basis
      • The difference between the initial investment (purchase price) and the principal amount of a purchased loan or group of loans
      • Servicing fees related to mortgage loans that are sold when the stated service fee rate differs significantly from a current (normal) servicing fee rate
  3. GASB 67 (effective for fiscal 2014):
    • Amends the requirements of GASB Statement No. 25, Financial Reporting for Defined Benefit Pension Plans and Note Disclosures for Defined Contribution Plans, and GASB Statement No. 50, Pension Disclosures — an amendment of GASB Statements No. 25 and No. 27, as they relate to pension plans administered through trusts that meet certain criteria.
    • Establishes standards for financial reporting by defined benefit pension plans administered through qualified trusts.
    • Amends note disclosure and required supplemental information requirements for defined benefit and defined contribution pension plans administered through qualified trusts.
  4. GASB 69 (effective for fiscal 2014):
    • Establishes accounting and financial reporting standards related to government combinations and disposals of government operations and helps determine if a transaction is a government merger or government acquisition.
    • Requires the use of carrying values to measure the assets and liabilities in a government merger.
    • Requires the measurement of assets acquired and liabilities assumed to be based generally upon their acquisition values.
    • Provides guidance for transfers of operations that do not constitute entire legally separate entities and in which no significant consideration is exchanged by defining the term operation and requiring the use of carrying values to measure the assets and liabilities in a transfer of operations.
    • Requires disclosures to be made about government disposals and combinations.
  5. GASB 70 (effective for fiscal 2014):
    • Requires a government that extends a nonexchange financial guarantee to recognize a liability when qualitative factors or historical data indicate it is likely a government will make a payment on the guarantee.
    • Requires a government that has issued an obligation guaranteed in a nonexchange transaction to report the obligation until legally released as an obligor.
    • Requires a government that is required to repay a guarantor for making a payment on a guaranteed obligation or legally assuming the guaranteed obligation to continue to recognize a liability until legally released as an obligor.
    • Clarifies the information required to be disclosed by governments that extend and receive nonexchange financial guarantees.
    • Provides additional guidance for intra-entity nonexchange financial guarantees involving blended component units.
  6. The following sections were updated:
    • Loan Costs — includes GASB 65 information related to:
      • Loans held for investment
      • Loans held for sale
      • Commitment fees
    • Self-Directed and Semi-Independent Agencies — clarifies local funds.
    • AFR Preparation — clarifies CANSS web application certification requirements.
    • Leased Property — provides an example on how to reclassify expenditures to capital leases.
    • Recording Capital Asset Leased Property — provides an example on how to record capital asset leased property for business-type activities.
    • Recording Amortization of Capital Assets — provides an example on how to record amortization transactions.
    • Due From/Due To Other University Components — clarifies:
      • Reverse Due From/To Other Agency
      • Record Due From/To Other University Components/System
      • Eliminate Remaining Reclassification Balances
    • Nonmonetary Assistance — provides nonmonetary assistance examples.
    • SEFA — Timeline — includes SEFA reminders
    • Interagency Pass-Throughs — SEFA and SPTR sections include a sample USAS transaction for pass-through refunds from funds held outside the state’s Treasury.
    • Instructions for the BRS web wpplication — includes new BRS web application fields with special instructions.
    • Schedule 2B — Changes in Bonded Indebtedness — includes the “Adjustments” column requirements
    • NOTE 6 — Bonded Indebtedness — includes GASB 65 requirements for unamortized gain or loss on refunding and amortization of issuance costs.
    • Note 17 — Risk Management — includes GASB 66 information about risk financing activities.
    • Capital Asset Note Preparation — clarifies CANSS web application certification requirements.
    • Accrual Requirements — includes the COBJs to record claims and judgments.
    • Required Note Disclosures — includes disclosure requirements for claims and judgments activity and an example to illustrate proper disclosure format.
    • Agency Year-End USAS Adjustments and AFR Checklist — includes:
      • FMQuery–SIRS queries located in the AFR Desk Review menu, where applicable.
      • Note 2 clarifies CANSS web application certification requirements.
    • Step 7 — Statement of Cash Flows clarifies ACFR web application certification requirements.
    • Glossary — includes acronyms used in the reporting requirements.
    • Working Papers — includes information on which T-codes and COBJs to use when processing these types of transactions:
      • Capital Assets Governmental Activities, Record Amortization
      • Capital Assets Governmental Activities, Record Adjustments
    • AFR Web Applications — includes a link to the instructions for the web applications.
    • AFR Ad Hoc Review Reports — includes FMQuery–SIRS queries located in the AFR Desk Review menu, where applicable.
  7. The SEFA web application was revised to include verification screens before final SEFA certification to verify:
    • Correct DUNS number is used
    • Correct EIN is used
    • CFDA is marked correctly as R&D when it belongs to another cluster
    • SEFA records are marked correctly when they contain funding from or to a non-state entity (NSE)
    • SEFA records with a negative balance contain a description
  8. The following DAFR names were revised from “net assets” to “net position”:
    • DAFR8581 Statement of Net Position — Balance Sheet Format (GWFS)
    • DAFR8585 Statement of Net Position — Net Position Format
    • DAFR8605 Statement of Changes in Fiduciary Net Position
  9. Under the Capital Assets tab, the following sub-left navigation menus were deleted and the information was combined under sub-left navigation menu AFR Preparation:
    • Reconciliation of SPA to AFR and Internal System Requirements
    • SPA/AFR Reconciliation Procedures and SPA Ad Hoc Reports List
  10. The “ITV T-code Chart” section of Interfund Activity & Transactions was renamed to T-code Chart for ITV’s and RTI’s.
  11. The following notes were renumbered:
    • NOTE 28 — Deferred Outflows of Resources and Deferred Inflows of Resources
    • NOTE 29 — Trouble Debt Restructuring
  12. A new left navigation menu was added under the General Accounting tab entitled Government Combinations & Disposals of Government Operations and includes the following sub-left navigation menus:
    • Government Mergers
    • Government Acquisitions
    • Transfers of Operations
    • Disposals of Government Operations
    • Note Disclosures & Sample
  13. A new left navigation menu was added under the General Accounting tab entitled Non-Exchange Financial Guarantees and includes the sub-left navigation menu Recognition and Measurement of Non-Exchange Financial Guarantees.
  14. A new sub-left navigation menu was added under the NOTE 9 – Pension Plans and Optional Retirement Program entitled GASB 67 — Financial Reporting for Pension Plans.
  15. A new left navigation menu was added under the Notes & Samples tab entitled NOTE 30 – Non-Exchange Financial Guarantees and includes a Sample sub-left navigation menu.
Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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