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GASB issues Statement No. 71, which amends its new pension standard

  • GASB (Governmental Accounting Standards Board) (blue) Image

Nov 27, 2013

On Monday, the Governmental Accounting Standards Board (GASB) issued GASB Statement No. 71, "Pension Transition for Contributions Made Subsequent to the Measurement Date—an amendment of GASB Statement No. 68," which resolves transition issues in GASB Statement No. 68, "Accounting and Financial Reporting for Pensions."

Statement 71 eliminates a potential source of understatement of restated beginning net position and expense in a government’s first year of implementing Statement 68, which was issued in June 2012.

To correct this potential understatement, Statement 71 requires that when a state or local government is transitioning to the new pension standards, that it "recognize a beginning deferred outflow of resources for its pension contributions made during the time between the measurement date of the beginning net pension liability and the beginning of the initial fiscal year of implementation. This amount will be recognized regardless of whether it is practical to determine the beginning amounts of all other deferred outflows of resources and deferred inflows of resources related to pensions."

Statement 71 is effective concurrent with Statement 68 for fiscal years beginning after June 15, 2014.

For more information, see the press release and Statement 71 on the GASB's Web site.

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