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Business and Policy Areas
Business and Policy Areas

New GASB Standard Tackles Fiduciary Activities

February 21, 2017

In an effort to help financial statement users understand the significance of a government’s fiduciary responsibilities, the Governmental Accounting Standards Board (GASB) issued Statement No. 84, “Fiduciary Activities,” on January 31. The new standard establishes criteria for identifying fiduciary activities and specifies how those activities are accounted for and reported in financial statements. The new standard is effective in FY20 for public institutions.

Under Statement 84, public institutions with material fiduciary activities will have to include fiduciary fund financial statements with their basic financial statements. These fiduciary fund financial statements will include a statement of net position and a statement of changes in net position. Although only a small number of institutions and systems may have reportable fiduciary activities, the new reporting requirement is significant because colleges and universities engaged in business-type activities (BTA) currently do not have fund-level financial reporting requirements. Fund-level financial statements are included before the notes to the financial statements.

BTA Exemption

The Statement offers a significant exemption for public institution BTAs when custodial assets are held for three months or less. This exemption allows public institutions to not report fiduciary fund financial statements for custodial activities related to federal student loans, payroll tax withholding, or payroll withholding for deferred health and retirement savings plans. Instead, public colleges and universities will continue to report assets with a corresponding liability in their statement of net position and should separately report any significant cash inflows and cash outflows in the operating section of the statement of cash flows.

Pension or Other Post-Employment Benefit (OPEB) Plan Trusts

Public institutions with single-employer defined benefit pension plans or OPEB plans that are subject to the requirements of Statements 67 and 74, respectively, will have fiduciary fund reporting requirements on the pension or OPEB trusts.  For these affected institutions, a Statement of Fiduciary Net Position and a Statement of Changes in Fiduciary Net Position for the pension or OPEB trust will need to be incorporated into the audited financial statements.

Fiduciary conditions

For a public college or university, an activity is considered a fiduciary activity if all of the three criteria below are met. However, as with any standard, the activity ought to be considered material for separate fiduciary fund financial statements to be produced. For public institutions, examples that may meet these criteria include 1) endowment assets of other institutions that are managed in the reporting institution’s investment pool and 2) alumni or student club accounts that are managed with the reporting institution’s cash or investments.


  1. The assets associated with the criteria are controlled by the government.
  2. The assets associated with the activity are not derived either: 
    • Solely from the government’s own source revenue, or
    • From non-exchange transactions.
  3. The assets associated with the activity have one or more of the following characteristics:
    • The assets are for the benefit of organizations or other governments that are not part of the financial reporting entity and the assets are not derived from the government’s provision of goods or services to those organizations or governments.
    • The assets are 1) administered through a trust in which the government is not a beneficiary; 2) dedicated to providing benefits to recipients in accordance with the benefit terms and 3) legally protected from the creditors of the government.
    • The assets are for the benefit of individuals and the government does not have administrative or direct financial involvement with the assets, and the assets are not derived from the government’s provision of goods or services to those individuals.

Statement 84 is available for download from GASB’s website.


Sue Menditto
Director, Accounting Policy