Tag Archives: GASB

Regulatory roundup

More retirement-related regulatory news for plan sponsors, including links to detailed information.

BLS article explores defined contribution retirement plans
A new article from the Bureau of Labor Statistics (BLS) takes a look at five types of employer-sponsored defined contribution retirement plans in private industry. The Beyond the Numbers article shows the overall employee participation rates, employee participation rates by type of plan, and overall employer costs and worker participation costs for all types of plans. All defined contribution plans described in this article have some form of employer cost. Plans are categorized by type on the basis of Internal Revenue Code requirements and variations in contribution methods. The data are from the BLS National Compensation Survey (NCS) and are presented by selected worker and establishment characteristics and geographic areas.

To read the entire article, click here.

CBO releases options for reducing the deficit, 2017 to 2026
The Congressional Budget Office (CBO) released “Options for reducing the deficit: 2017 to 2026,” presenting 115 options that would decrease federal spending or increase federal revenues over the next decade. The options included in this volume come from various sources. Some are based on proposed legislation or on the budget proposals of various administrations; others come from Congressional offices or from entities in the federal government or in the private sector. The options cover many areas—ranging from defense to energy, Social Security, and provisions of the tax code.

To download the report, click here.

GASB issues guidance on certain asset retirement obligations
The Governmental Accounting Standards Board (GASB) issued guidance for state and local governments addressing liabilities known as “asset retirement obligations.” An asset retirement obligation (ARO) is a legally enforceable liability associated with the retirement of a tangible capital asset. GASB Statement No. 83, Certain Asset Retirement Obligations, establishes guidance for determining the timing and pattern of recognition for liabilities and corresponding deferred outflows of resources related to AROs.

Existing laws and regulations require state and local governments to take specific actions to retire certain capital assets, such as the decommissioning of nuclear reactors and the dismantling and removal of sewage treatment plants. Other obligations to retire certain capital assets may arise from contracts or court judgments.

To read the entire GASB statement, click here.

GASB 73: Implementation and overview

GASB Statement 73 is for accounting and financial reporting for pensions not within the scope of GASB Statement 68, and applies for employer fiscal years beginning after June 15, 2016. GASB 73 applies to retirement plans (both defined benefit and defined contribution) that either do not have any dedicated assets associated with them or have assets that are not in a trust meeting certain requirements. With no assets in an irrevocable trust, the entire total pension liability is shown on the employer’s balance sheet under GASB 73.

Implementation of GASB 73 will result in required enhancements to financial statement disclosures by establishing a single framework for the presentation of information about pensions, which will enhance the comparability of pension-related information reported by employer and non-employer contributing entities. Milliman’s Jack Chmielewski provides perspective in this PERiScope article.

GASB 73/74/75: Timing considerations for compliance with new financial reporting rules

Governmental Accounting Standards Board (GASB) Statements 74 and 75 mandate changes to the way liabilities are reported on financial statements for state and local governments with other postemployment benefits (OPEB) obligations. These changes are designed to standardize the way OPEB expense is calculated and displayed in order to enhance disclosure and facilitate decision-making. There are several important dates to consider when calculating and reporting OPEB liability: the reporting date, actuarial valuation rate, and measurement date. Milliman’s Rebecca Ross provides perspective in this PERiScope article.

GASB 74/75: Calculation specifics on individual entry age normal

With Governmental Accounting Standards Board (GASB) Statements 73, 74, and 75, new accounting rules for public postretirement benefit plans in the United States are set to take effect soon. Successful implementation of the new rules will require an understanding of a variety of technical concepts regarding the various newly required calculations. In this PERiScope article, Milliman’s Michael Caparoso discusses the individual entry age actuarial cost method for the valuation of other postemployment benefits (OPEB).

Regulatory roundup

More retirement-related regulatory news for plan sponsors, including links to detailed information.

PBGC issues interim final rule on adjustment of civil penalties
The Pension Benefit Guaranty Corporation (PBGC) is amending its regulations to adjust the penalties provided for in sections 4071 and 4302 of ERISA. This interim final rule adjusts the maximum civil penalties that PBGC may assess. The new maximum amounts are $2,063 for section 4071 penalties and $275 for section 4302 penalties.

The amendments are effective August 1, 2016. The increases in the civil monetary penalties under sections 4071 and 4302 provided for in this rule apply on and after August 1, 2016.

To read the entire rule, click here.

FAF releases updated print editions of FASB and GASB accounting standards codifications
The Financial Accounting Foundation (FAF) has released updated print editions of the FASB Accounting Standards Codification, from the Financial Accounting Standards Board (FASB), and the Codification of Governmental Accounting and Financial Reporting Standards, from the Governmental Accounting Standards Board (GASB).

The FASB codification is the single, authoritative source of GAAP for public and private companies and not-for-profit organizations. For more information, click here.

The GASB codification is the single, authoritative source of GAAP for state and local governments. For more information, click here.

Regulatory roundup

More retirement-related regulatory news for plan sponsors, including links to detailed information.

GASB issues exposure drafts related to retirement plans
The Governmental Accounting Standards Board (GASB) has issued three exposure drafts proposing accounting and financial reporting guidance related to fiduciary activities, certain asset retirement obligations, and pension issues.

The exposure draft on fiduciary activities would establish guidance regarding what constitutes fiduciary activities for financial reporting purposes, the recognition of liabilities to beneficiaries, and how fiduciary activities should be reported. The proposed statement would apply to all state and local governments.

The exposure draft on certain asset retirement obligations would establish guidance for determining the timing and pattern of recognition for liabilities related to asset retirement obligations and corresponding deferred outflows of resources. An asset retirement obligation is a legally enforceable liability associated with the retirement of a tangible capital asset, such as the decommissioning of a nuclear reactor.

The exposure draft on pension issues addresses practice issues raised by stakeholders during the implementation of Statements No. 67, Financial Reporting for Pension Plans, and No. 68, Accounting and Financial Reporting for Pensions.

For more information, click here.

PBGC issues final rule on partitions of eligible multiemployer plans
The Pension Benefit Guaranty Corporation (PBGC) has issued a final rule making minor changes to part 4233 of its regulations. The changes were added from the PBGC’s interim final rule on Partitions of Eligible Multiemployer Plans (80 FR 35220, June 19, 2015). Many of the changes respond to public comments.

Part 4233 prescribes the statutory conditions and the information and notice requirements that must be met before the PBGC may partition an eligible multiemployer plan under section 4233 of ERISA. This final rule makes minor revisions to part 4233 with respect to information requirements, the time period for the PBGC’s initial review of an application for partition, and the coordinated application process for partition and benefit suspension.

To read the entire final rule, click here.