CT Governor Vetoes Accounting Standards Bill

July 10, 2007 (PLANSPONSOR.com) - Connecticut Governor Jodi Rell has vetoed a bill that would have given the state comptroller the legal authority to set generally accepted accounting principles for the state's financial reports.

The Associated Press reports that Rell said passage of the bill would have undermined transparency in government financial reporting and the state’s finances. “Bond investors and those making economic decisions have a clear understanding of statements prepared in conformity with GAAP,” she said. “To deviate from this standard would jeopardize the financial standing of our state.”

Last month, Financial Accounting Foundation President Robert J. DeSantis urged a veto of the legislation saying it “threatens the integrity and objectivity of the independent standard-setting process” and would increase borrowing costs for the state (See FAF President Urges Veto of CT Accounting Bill ). The legislation would have allowed the state comptroller to bypass local and state government rules mandated by the Governmental Accounting Standards Board (GASB) (See  GASB Hands Down Nonpension Benefit Accounting Guidance ).

“We applaud the governor,” said Gerard Carney, a spokesman for GASB, according to the AP. “This is a decision that reflects the best interest of the public.”

In May, the Texas House unanimously approved legislation that rejects the application of the GASB’s nationwide accounting rule on the long-term costs of benefits to retired government workers (See Texas House Unanimously Rebuffs GASB Standard ).