In this article, I will talk about some of the key things the Governmental Accounting Standards Board is working on and what’s on the horizon for the GASB. But before I do, there’s a matter of concern I would like to address.

State and local governments are dealing with significant resource challenges, including workforce shortages. We know when we add to or change Generally Accepted Accounting Principles (GAAP), we are adding to those resource challenges. With this in mind, we are committed to not undertaking any new project unless the resulting change would represent a meaningful, substantial improvement in governmental financial reporting and those resulting benefits outweigh the costs and burdens we are placing on those who must implement the change. If you would like to talk with us about this, please reach out.

Project Milestones

The GASB is on track to issue or review the following documents in the second half of 2023:

• A new standard on the disclosure of certain governmental risks,
• An exposure draft on the classification of nonfinancial assets, and
• A post-implementation report detailing how the pension standards are working in practice.

The Board also recently added a new project on accounting and financial reporting for infrastructure. Each of the key areas are highlighted below.

Certain Risk Disclosures

This standard will provide disclosure requirements for two categories of risk that governments face: concentrations (such as a principal employer) and constraints (such as a cap on property tax amounts).

Providing financial statement users with information about these kinds of vulnerabilities would have a meaningful impact on their decision making and assessments of accountability. The Board plans to issue this standard in the third quarter.

Nonfinancial Assets

The GASB is reconsidering the existing classification of nonfinancial assets and other related sub-classifications, including capital assets or intangible assets. In our outreach, users told us that separate presentation or disclosure of different types of nonfinancial assets is important to them. We will issue the proposal for public comment in the third quarter and look forward to the feedback we receive on the types of improvements we are considering.

Pensions

The GASB’s pension standard issued in 2012 represented a monumental change in how governments report those significant liabilities. Reviewing the pension standards now that they’ve been in place for several years is critical to making sure they are functioning as intended. The final report on what we call “the post-implementation review” of the pension standards will be released to the Board and to the public before the end of the year. It will provide information on how the standards are working and what areas could potentially be improved.

The Board will carefully evaluate the findings to determine whether a project addressing any potential changes to the pension standards is needed. We appreciate all our stakeholders who took the time to share their perspective in this important review process. That feedback is the lifeblood of the review—and helps ensure we come to the right decision going forward. The report is due for release in the fourth quarter of 2023.

Infrastructure

The research we have conducted over the last several years on capital assets, including infrastructure assets, has looked broadly at these areas across the full financial reporting model. Many people shared their perspective with us on how the model is working, what problems and challenges they see, and what information they are not receiving or could be improved. After carefully evaluating the staff’s research findings this spring and after taking into account the high level of interest from our advisory council, the Board made the decision to add a related project to the agenda focusing on infrastructure assets, which includes things like highways and sewer systems. Board deliberations on the project will begin shortly.

Learn more about these and other GASB projects through the Board’s Technical Plan page at www.gasb.org/techplan.

Other Improvements Underway

The GASB is also focused on internal measures to improve how we do our work, how we engage with our stakeholders, and the resources we provide to them.

Earlier this year, we launched a new version of the Governmental Accounting Research System, or GARS. Learn more at https://gars.gasb.org/Login. It is now available free of charge, and features a more modern interface, greatly improved search functionality, and other improvements. Feedback on this research tool has been highly positive.

We are continuing to offer electronic input forms on our proposals to provide a convenient way for you to share your thoughts with the Board. We plan to feature an electronic input form for the upcoming proposal on nonfinancial assets mentioned earlier.

The GASB has increased the resources dedicated to monitoring electronic financial reporting. This will allow us to be prepared to understand and adapt to the continuing evolution of government financial reporting, including advancements achieved through the use of technology.

Finally, we have just launched a new podcast series called Bridging the GAAP that features informal discussions on key issues in governmental accounting, such as the Financial Data Transparency Act, and topics mentioned above.

Final Thoughts

As we look ahead to the GASB’s 40th anniversary in 2024, there is a lot to be excited about. We will be announcing more about our plans to recognize this important milestone, so please stay tuned.

In closing, if members of the Nebraska Society of Certified Public Accountants have questions about anything mentioned in this article or have information to share with the GASB, please reach out at gasb.news@gasb.org. We are always happy to hear from you. 

The views expressed in this article are those of Joel Black only. Official positions of the GASB on accounting matters are determined only after extensive public due process and deliberation.

Joel Black was named to a seven-year term as chairman of the Governmental Accounting Standards Board effective July 1, 2020. Prior to joining the GASB, Black was with Mauldin & Jenkins LLC in Atlanta. He joined Mauldin & Jenkins in 2004 as a director and was named partner in 2005 before his appointment to partner in charge of the audit practice in January 2019. Previously, he worked for KPMG LLP from 1992 to 2004.