Summaries / Status
Summary of Statement No. 2
Financial Reporting of Deferred Compensation Plans Adopted under the Provisions of Internal Revenue Code Section 457
This Statement requires that, for employers using governmental fund accounting, Internal Revenue Code (IRC) Section 457 deferred compensation plan balances be displayed in an agency fund of the governmental employer that has legal access to the resources, whether the assets are held by the employer, a public employee retirement system (PERS), a nongovernmental third party, or another governmental entity under a multiple-jurisdiction plan. Governmental public utilities and public authorities should report the liability in the balance sheet with a corresponding designated asset.
Note disclosure is required of (a) the requirement of IRC Section 457 that the assets in the plan remain the property of the employer until paid or made available to participants, subject only to the claims of the government's general creditors and (b) the government's fiduciary responsibilities under the plan.
Unless otherwise specified, pronouncements of the GASB apply to financial reports of all state and local governmental entities, including public benefit corporations and authorities, public employee retirement systems, and governmental utilities, hospitals, colleges, and universities.