NEWS RELEASE 06/28/10

Deadlines Approaching for Comment on Two GASB Exposure Drafts

Norwalk, CT, June 28, 2010—The deadlines for comment on two Governmental Accounting Standards Board (GASB) Exposure Drafts (EDs) of proposed Statements—The Financial Reporting Entity (an amendment of GASB Statements No. 14 and No. 34) and Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements—are approaching. Users, auditors, and preparers of state and local government financial reports have until Wednesday, June 30 to submit written comments on the Financial Reporting Entity ED. The deadline for comment on the Codification ED is Saturday, July 31.

The proposed amendment of Statements 14 and 34 is intended to improve financial reporting of component units, which are legally separate organizations that state and local governments are accountable for and therefore include in their financial reports. It would modify the existing criteria for inclusion of organizations that are “fiscally dependent” on a government by adding a requirement that the potential component unit and the primary (reporting) government also have a financial benefit or burden relationship. Also, in cases where the government determines it would be misleading to exclude from its financial reports an organization that does not meet the financial accountability criteria, the proposed amendment would clarify the manner in which a government should make such a determination.

The proposed Statement, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements, is intended to enhance the usefulness of the GASB’s Codification of Governmental Accounting and Financial Reporting Standards by incorporating guidance that previously could only be found in certain pronouncements of the Financial Accounting Standards Board (FASB) and American Institute of Certified Public Accountants (AICPA). By incorporating and maintaining this guidance in a single source, the GASB will reduce the complexity of locating and using authoritative literature needed to prepare state and local government financial reports and, thereby improve the consistency and comparability of government financial reports.

The EDs can be downloaded from the Documents for Public Comment section of the GASB website at www.gasb.org.

About the Governmental Accounting Standards Board

The GASB is the independent, not-for-profit organization formed in 1984 that establishes and improves financial accounting and reporting standards for state and local governments. Its seven members are drawn from the Board’s diverse constituency, including preparers and auditors of government financial statements, users of those statements, and members of the academic community. More information about the GASB can be found at its website www.gasb.org.