GFOA Responds to GASB Exposure Draft

Thursday, September 28, 2017

GFOA sent a letter to the Governmental Accounting Standards Board (GASB) in response to the GASB’s Exposure Draft (ED) of Implementation Guide No. 201X-Z, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions (and Certain Issues Related to OPEB Plan Reporting). GFOA supports the GASB providing more guidance to preparers of financial statements through implementation guides. The letter reiterates issues GFOA has previously communicated about proposed postemployment benefit implementation guidance, and about the practical effect of following proposed guidance that would preclude employers from including resources held in an Internal Revenue Code (IRC) Section 115 trust from the calculation of their net OPEB liability, even though the resources held in such a trust must be used exclusively to fund the employers’ total OPEB liability. Such an outcome would be representationally unfaithful and potentially confusing to financial statement users. The letter offers several potential improvements to the implementation guide.

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