GASB Statement No. 84, Fiduciary Activities, paragraphs 6-11, defines fiduciary activities for purposes of accounting and financial reporting. It focuses on 1) whether a government is controlling the assets, and 2) the beneficiaries with whom the relationship exists. Separate criteria apply for fiduciary component units and postemployment benefit arrangements that are fiduciary activities.
Governments may report a number of activities within their fiduciary funds as trust or agency funds. GASB 84 improves the guidance regarding the identification of fiduciary activities for accounting and financial reporting. GFOA recommends that governments begin to review their current fiduciary activities and devote time to developing a plan for the implementation of GASB 84 within their organization. The list of key considerations below has been developed to provide guidance.1
- Begin discussions government-wide to educate stakeholders on the new GASB guidance. Stakeholders should include, for example, those working with the budget, information technology, local school councils, principals, attorneys, and OPEB plan administrators.
- Identify all potential fiduciary activities.
- Identify the types of fiduciary funds.
- Determine when to recognize a fiduciary fund liability.
- Apply the Standard retroactively and prepare the disclosures.