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Glenn Hegar  ·  Texas Comptroller of Public Accounts

Reporting Requirements for Annual Financial Reports of State Agencies and Universities

Introduction

Governmental Accounting Standards Board (GASB)
Upcoming GASB Statements, Exposure Drafts and Preliminary Views

Upcoming GASB Statements

If you need additional information or clarification on any of the GASB statements mentioned below, you may download free PDF versions from GASB’s Pronouncements page.

  1. GASB Statement No. 83, Certain Asset Retirement Obligations, which is effective fiscal 2019.

    GASB 83:

    • Determines the timing and pattern of recognition of a liability and a corresponding deferred outflow of resources for asset retirement obligations (ARO)
    • Requires the measurement of an ARO to be based on the best estimate of the current value of outlays expected to be incurred
    • Requires the current value of a government’s AROs to be adjusted for the effects of general inflation or deflation at least annually
    • Requires disclosure of information about the nature of a government’s AROs, the methods and assumptions used for the estimates of the liabilities, and the estimated remaining useful life of the associated tangible capital assets
  2. GASB Statement No. 84, Fiduciary Activities, which is effective fiscal 2020.

    GASB 84:

    • Establishes criteria for identifying fiduciary activities of all state and local governments:
      • (1) whether a government is controlling the assets of the fiduciary activity
      • (2) the beneficiaries with whom a fiduciary relationship exists
    • Separate criteria are included to identify fiduciary component units and postemployment benefit arrangements that are fiduciary activities
  3. GASB Statement No. 87, Leases, which is effective fiscal 2021.

    GASB 87:

    • Establishes a single model for lease accounting (eliminates long-term operating leases)
    • Requires lessee to recognize a lease liability and intangible right-to-use lease asset
    • Requires lessor to recognize a lease receivable and deferred inflows of resources
    • Requires additional disclosures for both lessee and lessor
  4. GASB Statement No. 88, Certain Disclosures Related to Debt, including Direct Borrowings and Direct Placements, which is effective fiscal 2019.

    GASB 88:

    • Defines debt as a liability that arises from a contractual obligation to pay cash (or other assets in lieu of cash) in one or more payments to settle a fixed amount
    • Requires additional disclosures including unused lines of credit, assets pledged as collateral and terms related to significant events of default with finance-related consequences, significant termination events with finance-related consequences and significant subjective acceleration clauses
    • Clarifies which liabilities governments should disclose debt-related information

Exposure Drafts

  1. GASB issued an exposure draft in January 2016 entitled Leases — Reexamination of NCGA Statement 5 and GASB Statement 13. The objective of this project is to reexamine issues associated with lease accounting and considers improvements to existing guidance. The major topic being researched is the forms of financial reporting display and disclosure that would meet essential financial statement user needs.

    For more information, see Leases — Reexamination of NCGA Statement 5 and GASB Statement 13 on the Current Projects page of GASB’s website.

Preliminary Views

GASB currently has preliminary views of statements.

Other Projects Currently Being Deliberated

  1. GASB is currently deliberating a project titled Conceptual Framework — Measurement and Recognition. This project has two primary objectives that are addressed in two subprojects:
    • To develop recognition criteria for whether information should be reported in state and local governmental financial statements and when that information should be reported
    • To consider the measurement concepts:
      • The measurement approach(s) (for example, initial amounts or remeasured amounts) that conceptually should be used in governmental financial statements
      • The measurement attributes (the feature of the assets or liabilities that are measured)

    This project ultimately will lead to a Concepts Statement on measurement and a Concepts Statement on recognition of elements of financial statements.

    This project has been placed on hold pending reexamination of the Financial Reporting Model.

    For more information, see Conceptual Framework — Measurement and Recognition on the Current Projects page of GASB’s website.

  2. GASB is currently deliberating a project titled Financial Reporting Model — Reexamination of Statements 34, 35, 37, 41, and 46 and Interpretation 6. The objective of the project is to make improvements to the financial reporting model — improving the effectiveness of the model in providing information that is essential for decision-making and enhancing the ability to assess the state’s accounting and address certain application issues. The statements that are being reviewed are:
    • GASB Statement No. 34, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments
    • GASB Statement No. 35, Basic Financial Statements—and Management’s Discussion and Analysis—for Public Colleges and Universities
    • GASB Statement No. 37, Basic Financial Statements—and Management’s Discussion and Analysis—for State and Local Governments: Omnibus
    • GASB Statement No. 41, Budgetary Comparison Schedules—Perspective Differences
    • GASB Statement No. 46, Net Assets Restricted by Enabling Legislation
    • GASB Interpretation No. 6, Recognition and Measurement of Certain Liabilities and Expenditures in Governmental Fund Financial Statements

    For more information, see Conceptual Framework — Financial Reporting Model—Reexamination of Statements 34, 35, 37, 41, and 46 and Interpretation 6 on the Current Projects page of GASB’s website.

  3. GASB is currently deliberating a project titled Revenue and Expense Recognition. The objective of this project is to develop a comprehensive application model for the recognition of revenues and expenses that arise from nonexchange, exchange and exchange-like transactions, including guidance for exchange transactions that have not been specifically addressed in the current literature. The purpose for developing a comprehensive model is to:
    • Improve the information regarding revenues and expenses that users receive to make decisions and assess accountability
    • Provide guidance regarding exchange and exchange-like transactions that have not been specifically addressed
    • Evaluate revenue and expense recognition in the context of the conceptual framework
    • Address application issues identified in practice, based upon the results of the pre-agenda research on revenue for exchange and exchange-like transactions

    For more information, see Revenue and Expense Recognition on the Current Projects page of GASB’s website.

Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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