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Business and Policy Areas
Business and Policy Areas

GASB Announces Technical Plan Additions

May 6, 2010

In April, the Governmental Accounting Standards Board (GASB) added three projects to the Board's technical agenda: a practice issues project related to the statement of net position, and projects addressing fiduciary responsibilities and financial guarantees.  

Statement of Net Position

GASB Concepts Statement No. 4, "Elements of Financial Statements," included definitions of deferred inflows and deferred outflows of resources as elements separate from assets and liabilities. Deferrals are defined as inflows and outflows related to future periods. Several projects and recent pronouncements have proposed or required the reporting of deferrals in the statement of net assets, (for example, statement no. 53, "Accounting and Financial Reporting for Derivative Instruments"). However, it is not clear, based on Statement No. 34, "Basic Financial Statements-and Management's Discussion and Analysis-for State and Local Governments," where they should appear.

This project is intended to establish display guidance for deferred inflows and deferred outflows.  If the deferred inflows and deferred outflows are to be displayed separately, then consideration will also be given to the term used to articulate the residual element presented that represents the difference between assets, deferred outflows, liabilities, and deferred inflows.  In late summer 2010, after seeking input from constituents, the Board will begin to deliberate various display alternatives.

Fiduciary Responsibilities

The objective of this project is to assess whether additional guidance should be developed regarding the application of the fiduciary responsibility criterion in deciding whether and how governments should report fiduciary activities in their financial reports. Existing standards do not clearly answer those questions and there has been diversity in the interpretation of fiduciary responsibility. The project will research whether additional guidance should be developed for determining fiduciary responsibility.  Research is expected to begin in May.

Financial Guarantees

The objective of this project is to assess additional guidance needed concerning the recognition and disclosure of financial guarantees made and received by state and local governments. Such guarantees are primarily associated with commitments related to debt issued by other entities. For example, a government will guarantee a school district's general obligation bonds in the event of a debt service shortfall. If the GASB concludes that guidance is warranted, the project could potentially result in a statement or an interpretation. A key research goal is determining what forms of financial reporting displays and disclosures are necessary to meet financial statement user needs.  Research is expected to begin in May.

More information is available about these issues in the Projects section of the GASB's newly redesigned website.


Sue Menditto
Director, Accounting Policy