GASB Statement Codifies Certain AICPA Guidance

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April 23, 2009

The Governmental Accounting Standards Board (GASB) has issued Statement No. 56, "Codification of Accounting and Financial Reporting Guidance Contained in the AICPA Statements on Auditing Standards." Statement 56 guidance addresses three issues from the American Institute of Certified Public Accountants’ (AICPA) literature-related party transactions, going concern considerations, and subsequent events.

Statement 56 incorporates guidance that previously was only contained in the AICPA’s auditing literature into GASB’s accounting and financial reporting literature for governmental entities. This statement brings existing guidance (to the extent appropriate in a governmental environment) without substantive changes into the GASB’s body of standards. Statement 56 is part of the GASB’s effort to codify all generally accepted accounting principles for state and local governments so that they derive from a single source. This is intended to make it easier for preparers to identify and apply relevant accounting guidance. Statement 56 is effective immediately. To obtain a copy of the statement, log on to www.gasb.org.

Staff Resource: Sue Menditto, director, accounting policy