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On June 13, the Governmental Accounting Standards Board (GASB) issued Statement No. 100, Accounting Changes and Error Corrections. Statement 100 amends Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements, to address diversity in applying existing standards in practice.

The new standard defines four categories of accounting changes and error corrections and related accounting and financial reporting requirements:

  1. Changes in accounting principle must be reported retroactively by restating prior periods.
  2. Changes in accounting estimate must be reported prospectively by recognizing the change in the current period.
  3. Changes to and within the financial reporting entity must be reported by adjusting beginning balances of the current period.
  4. Error corrections result from mathematical mistakes, misuse of information, or misapplication of accounting principle and should be reported retroactively by restating prior periods.

The statement also addresses display of accounting changes and error corrections in the financial statements, disclosures in the notes to the financial statements, and presentation in required supplementary information and supplementary information. For example, Statement 100 requires that governments disclose the effects of each accounting change and error correction on beginning balances in tabular format.

Note that this statement does away with the term “prior period adjustment.” Transactions previously reported as prior period adjustments are now incorporated into one of the four categories noted above.

Statement 100 is effective in FY24. Earlier application is encouraged.


Chris Leach

Accounting Policy Analyst



Sue Menditto

Senior Director, Accounting Policy


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