Blog

GASB seeks input on subsequent reporting guidance

  • Blog

    GASB seeks input on subsequent reporting guidance

    In September 2022, the Governmental Accounting Standards Board (GASB) published a survey for financial statement preparers to evaluate GASB’s existing standards for the financial reporting of subsequent events by state and local governments. The survey will close on November 18, 2022 and counties are encouraged to respond.

    GASB issued the Codification of the Accounting and Financial Reporting Guidance Contained in the American Institute of Certified Public Accountants (AICPA) Statements on Auditing Standards (Statement 56) in March 2009 that established standards and guidance for subsequent event reporting. A subsequent event refers to one that falls outside the reporting period but occurs before the issuance of financial statements and depending on the situation is required to be disclosed.

    During its adoption, Statement 56 was not evaluated for its appropriateness and overall applicability to state and local governments however a study of randomly selected financial reports found that 37 percent of counties have disclosed subsequent events and these events most frequently are related to municipal bonds. The same study found that 9 percent of counties disclosed a subsequent event in error and 42 percent of state, county and city governments did not disclose certain required subsequent events related to changes in bond ratings.

    In recognition that there might be some difficulty determining when to disclose subsequent events, this survey will help GASB determine the effectiveness of current guidance and whether or not certain revisions need to be made. The survey will specifically consider the following:

    1. How prevalent are recognized and nonrecognized subsequent events among state and local governments?
    2. How prevalent are subsequent event disclosures? What types of subsequent events do governments disclose in practice?
    3. What difficulties do governments have, if any, distinguishing between subsequent events that require adjustments to the financial statements and those that are limited to disclosure?
    4. What difficulties do governments have, if any, determining whether information that became available prior to the issuance of the financial statements reflects conditions that existed as of the date of the financial statements?
    5. What other issues do governments and auditors have, if any, in applying the standards?
    6. How are the standards applied to events occurring after the issuance of the financial statement when a government reissues the financial statements?
    7. How do the nature and timing of subsequent events relate to those of the events being addressed by the Risks and Uncertainties Disclosures project?
    8. What impact might the proposed changes to MD&A in the Financial Reporting Model project have on subsequent events reporting?
    9. What information are governments disclosing about subsequent events? Is that information essential to users for making decisions and assessing government accountability?
    10. What disclosures do users need, if any, about subsequent events that they are not currently receiving? How would they use that information?
    11. What essential information, if any, do users need regarding recognized subsequent events?

    NACo recognizes the need for full disclosure of all relevant information concerning a county’s financial condition to potential investors, citizens, and other parties interested in municipal bonds. NACo opposes federally imposed standards for county financial accounting and reporting but supports those principles put forth by the GASB.

    In September 2022, the Governmental Accounting Standards Board (GASB) published a survey for financial statement preparers to evaluate GASB’s existing standards for the financial reporting of subsequent events by state and local governments. The survey will close on November 18, 2022 and counties are encouraged to respond.
    2022-11-15
    Blog
    2022-11-15
  • 03
    09
    2:00 pm
    Reports & Toolkits

    <p>In March of 2021, the American Rescue Plan Act of 2021 authorized the $350 billion State and Local Coronavirus Fiscal Recovery Fund&nbsp;(Recovery Fund),&nbsp;which provided&nbsp;$65.1 billion in direct, flexible aid to

  • page

    <table border="1" cellpadding="1" cellspacing="1" style="width:100%" summary="call-out transparent">
    <tbody>
    <tr>

  • Basic page

    Finance, Pensions & Intergovernmental Affairs Steering Committee

    All matters pertaining to the financial resources of counties, fiscal management, federal assistance, municipal borrowing, county revenues, federal budget, federal tax reform, elections and Native American issues. Policy Platform & Resolutions 2023-2024 2023 NACo Legislative Priorities
    page

    <p>All matters pertaining to the financial resources of counties, fiscal management, federal assistance, municipal borrowing, county revenues, federal budget, federal tax reform, elections and Native American issues.</p>

Related Posts

Related Resources

More From