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11/1/02 Financial Services Department


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11/1/02 Financial Services Department

  1. 1. <ul><li>CITY OF AUSTIN </li></ul><ul><li>Audit & Finance Committee Briefing </li></ul><ul><li>Implementing GASB 34 </li></ul><ul><li>November 5, 2002 </li></ul>
  2. 2. What is GASB 34? <ul><li>GASB Statement 34, Basic Financial Statements - and Management’s Discussion and Analysis – for State and Local Governments </li></ul><ul><li>Issued by the Governmental Accounting Standards Board (GASB) [sounds like GAZ bee ] </li></ul><ul><li>GASB formed in 1984 </li></ul><ul><li>GASB has worked on this statement for almost 20 years. </li></ul>
  3. 3. So -- What is GASB 34? <ul><li>New accounting rules for governments. </li></ul><ul><li>This is “GAAP” for governments (Generally Accept Accounting Principles) </li></ul><ul><li>Required for annual audit report </li></ul><ul><ul><li>For a “clean” audit opinion </li></ul></ul>
  4. 4. The Most Important Changes <ul><li>Summary-level statements </li></ul><ul><li>Highly summarized </li></ul><ul><li>Combines governmental & enterprise funds </li></ul><ul><ul><li>Uses business-type accounting rules for all funds </li></ul></ul><ul><li>Focus on programs at a very high level </li></ul><ul><li>Shows the extent to which programs are self-funded. </li></ul><ul><li>Requires capitalizing & depreciating infrastructure assets </li></ul>
  5. 5. The Most Important Changes <ul><li>Below Summary Level Statements </li></ul><ul><li>Focus on “Major Funds” </li></ul><ul><li>GASB 34 sets rules for Major Funds </li></ul>
  6. 6. Other Changes <ul><li>Requires presenting both the original & amended budgets in comparing to actual for governmental funds </li></ul><ul><li>Other technical changes </li></ul><ul><li>Below “Major Funds” – Report same funds as we reported in the past </li></ul>
  7. 7. Key Implementation Challenge – Difficulties in Explaining Summary vs. Lower Level Statements <ul><li>Summary Level </li></ul><ul><li>Add to Fund level amounts: governmental fund assets & infrastructure, depreciation, accrue more receivables/ revenue, debt </li></ul><ul><li>Allocate internal service funds </li></ul><ul><li>Exclude fiduciary funds </li></ul><ul><li>Lower level </li></ul><ul><li>Reporting is very like prior years </li></ul>
  8. 8. Key Implementation Challenges <ul><li>Reporting infrastructure values </li></ul><ul><ul><li>Roads, bridges </li></ul></ul>
  9. 9. Infrastructure Reporting <ul><li>COA Approach to Infrastructure Reporting– </li></ul><ul><li>Will use estimated historical cost </li></ul><ul><ul><li>(depreciate an asset just like a business) </li></ul></ul><ul><ul><li>Alternative – “modified approach” </li></ul></ul>
  10. 10. Implementation Dates <ul><li>The first GASB 34 reporting deadline for COA - </li></ul><ul><ul><li>Statements for September 30, 2002. </li></ul></ul><ul><li>COA deadline for infrastructure reporting – </li></ul><ul><ul><li>Required by September 30, 2006. </li></ul></ul><ul><ul><li>Will implement for 2002. </li></ul></ul><ul><ul><li>Possible only through substantial effort by a cross-departmental team. </li></ul></ul>
  11. 11. GASB 34 Web Sites <ul><li>www. gasb .org/ repmodel /index.html - Governmental Accounting Standards Board </li></ul><ul><li> – Government Finance Officers Association </li></ul><ul><li> – State of Texas informational site </li></ul><ul><li> – State of Oregon (an early implementer of GASB34) </li></ul><ul><li> </li></ul><ul><li>City of Austin Controller’s Office – for an electronic copy of this document </li></ul><ul><li>( You may need to type in these addresses manually.) </li></ul>
  12. 12. Questions & Assistance ? <ul><ul><li>Please contact the Controller’s Office: </li></ul></ul><ul><ul><li>Barbara Nickle, City Controller, 974-2602 </li></ul></ul><ul><ul><li>Andi Reaves, Deputy Controller, 974-3416 </li></ul></ul>