New York (June 25, 2012) – The American Institute of
CPAs supported the vote today by the Governmental Accounting Standards Board
to improve existing standards for pension accounting and financial reporting for
state and local employers, as well as governmental pension plans.
"The
AICPA strongly supports GASB´s efforts to improve transparency related to public
pension benefits and their effect on the finances of state and local
governments," AICPA President and CEO Barry
C. Melancon, CPA, CGMA, said. "The new GASB standards will
benefit users of these financial statements, as well as taxpayers, since state
and local governments for the first time will have to report unfunded pension
liabilities on their balance sheets providing a clearer view of pension
obligations."
Specifically, the new standards will require governments to
report in their financial statements a net pension liability that is equal to
the difference between the total pension liability and the value of assets set
aside in a pension plan to pay benefits to current employees, retirees and their
beneficiaries. Currently, governments must only report as a liability the
difference between the contributions they are required to make to a pension plan
in a given year versus what they actually funded.
The two
standards approved by GASB – Statement No.
67, Financial Reporting for Pension Plans, and Statement No. 68,
Accounting and Financial Reporting for Pensions – have different
implementation dates. The provisions in Statement 67 are effective for
periods beginning after June 15, 2013. The provisions in Statement 68 are
effective for fiscal years beginning after June 15, 2014.
About
the AICPA
The American Institute of Certified Public Accountants
(AICPA) is the world´s largest association representing the accounting
profession, with nearly 377,000 members in 128 countries and a 125 year heritage
of serving the public interest. AICPA members represent many areas of
practice, including business and industry, public practice, government,
education and consulting.
The AICPA sets ethical standards for the
profession and U.S. auditing standards for audits of private companies,
non-profit organizations, federal, state and local governments. It develops and
grades the Uniform CPA Examination and offers specialty credentials for CPAs who
concentrate on personal financial planning; fraud and forensics; business
valuation; and information technology. Through a joint venture with the
Chartered Institute of Management Accountants (CIMA), it has established the
Chartered Global Management Accountant (CGMA) designation to elevate management
accounting globally.
The AICPA maintains offices in New York, Washington,
DC, Durham, N.C., and Ewing,
N.J.