GASB Issues Statement No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries.
November 18, 2003
The Governmental Accounting Standards Board (GASB) has published Statement No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries, that requires governments to report the effects of capital asset impairment in their financial statements. The guidance also enhances comparability of financial statements by requiring all governments to account for insurance recoveries in the same manner.
The Statement requires governments to evaluate major events affecting capital assets to determine whether they are impaired. Such events include physical damage, changes in legal or environmental factors, technological changes or obsolescence, changes in manner or duration of use and construction stoppage.
Impairment will be measured using methods that are designed to isolate the cost of the capital asset’s service capacity that has been rendered unusable by impairment. The Statement requires that government financial statements report service utility losses when they occur rather than over the remaining useful life of the capital asset. The guidance also includes several disclosure requirements that will assist users of financial statements in understanding the nature and impact of impairment of capital assets.
Statement 42 is effective for fiscal years beginning after December 15, 2004. The Statement may be ordered by telephoning the GASB Order Department at 800-748-0659. or visiting the GASB Web site.
- Affordable Care Act: Final Rules on Coverage for Adjuncts and Students
- Administrative Jobs and Benefits Costs Drive Higher Ed Labor Costs
- OMB Super Circular Makes Changes to Audit Requirements
- 2014 Higher Education Accounting Forum
April 27-29, 2014
- ON-DEMAND: Understanding the Results of the 2013 NACUBO-Commonfund Study of Endowments, and a Look to 2014 and Beyond
- ON-DEMAND: How Behavioral Changes Helped Cut Energy Usage in Half
- ON-DEMAND: Developing a Market-Informed Approach to Tuition Pricing
- ON-DEMAND: Responsibility Center Management: The Process Necessary to Complete a Successful Implementation
- ON-DEMAND: OD: Responsibility Center Management: How Innovations Have Changed the Nature of RCM
- A Guide to College and University Budgeting: Foundations for Institutional Effectiveness, 4th ed. - by Larry Goldstein
- NACUBO's Guide to Unitizing Investment Pools - by Mary S. Wheeler
- Managing and Collecting Student Accounts and Loans - by David R. Glezerman and Dennis DeSantis