Reporting Requirements for Annual Financial Reports of State Agencies and Universities

Resources

Agency Fiscal Year-End USAS Adjustments and AFR Checklist
Step 8 – Notes to the Financial Statements

• Note 1
• Note 2
• Note 3
• Note 4
• Note 5
• Note 6
• Note 7
• Note 8
• Note 9
• Note 10
• Note 11
• Note 12
• Note 13
• Note 14
• Note 15
• Note 16
• Note 17
• Note 18
• Note 19
• Note 20
• Note 22
• Note 23
• Note 24
• Note 25
• Note 26
• Note 27
• Note 28
• Note 29
• Note 30
• Note 31
• Note 32
• View All

Note 31 – Tax Abatements

1. Disclose tax abatements that reduce the reporting agency’s tax revenues per GASB 77 requirements.
2. If the agency has a tax abatement (as defined by GASB 77) disclosed in the notes to the financial statements, the Government Finance Officers Association (GFOA) recommends that the agency includes other information in the transmittal letter that provides the justification and expected long-term benefits of tax abatements.
3. If the agency has a tax abatement program(s) (as defined by GASB 77), the disclosures in the notes to the financial statements must distinguish between tax abatements entered by the reporting agency and tax abatements entered by other agencies that reduced the reporting agency’s tax revenues.
4. For tax abatement programs entered by the reporting agency, ensure the disclosures include the following (if applicable):
   1. Descriptions of the abatements, including the:
      1. Names and purposes of the abatements
      2. Taxes being abated
      3. Authority under which abatement agreements are entered
      4. Mechanisms by which taxes are abated
      5. Recapture provisions
          AND 
      6. Commitments made by the recipients of abatements
   2. Gross dollar amount of tax revenue reduced in the current year (accrual basis)
   3. Any amounts received or receivable from another agency
   4. Descriptions of any other commitments the agency made in addition to reducing tax revenues
   5. The quantitative threshold for disclosing individual tax abatement agreements

   Note: If any of the required disclosure items are legally prohibited from being disclosed, the agency must provide a general description of the information omitted and disclose the specific source of the legal prohibition.

5. For tax abatement programs entered by other agencies that reduce the reporting agency’s revenue, ensure the disclosures include the following (if applicable):
   1. Descriptions of the abatements, including the:
      1. Names of agencies entered in the tax abatement agreements
          AND 
      2. Taxes being abated
   2. Gross dollar amount of tax revenue reduced in the current reporting period (accrual basis)
   3. Any amounts received or receivable from another agency
   4. The quantitative threshold for disclosing individual tax abatement agreements

   Note: If any of the required disclosure items are legally prohibited from being disclosed, the agency must provide a general description of the information omitted and disclose the specific source of the legal prohibition.

6. Submit a copy of the agency’s applicable note from its published AFR through the ONDSS web application. The required format is a Microsoft Word document (latest version: docx) with header information that includes: agency name/number and note number/name. If the note contains a table, include the table in the Word document — rather than as a separate Excel document or other database application file. Do NOT submit a note to indicate “not applicable.”