A news release from the Governmental Accounting Standards Board (GASB) said that the new Statement No. 50, Pension Disclosures, amends GASB Statements No. 25, Financial Reporting for Defined Benefit Pension Plans (See GASB Unveils Proposal on Disclosure Requirements for Plans ) and Note Disclosures for Defined Contribution Plans, and No. 27, Accounting for Pensions by State and Local Governmental Employers, by requiring
- Disclosure in the notes to the financial statements of pension plans and certain employer governments of the current funded status of the plan – the degree to which the actuarial accrued liabilities for benefits are covered by assets that have been set aside to pay the benefits – as of the most recent actuarial valuation date.
- Governments that use the aggregate actuarial cost method to disclose the funded status and present a multi-year schedule of funding progress using the entry age actuarial cost method as a surrogate; these governments previously were not required to provide this information.
- Disclosure by governments participating in multi-employer cost-sharing pension plans of how the contractually required contribution rate is determined.
The provisions of Statement 50 generally are effective for periods beginning after June 15, 2007, with early implementation encouraged. The requirements relating to governments using the aggregate actuarial cost method are effective for financial statements and required supplementary information that contains information from actuarial valuations as of June 15, 2007, or later.
“The GASB’s standards for retiree health insurance and other non-pension retirement benefits make disclosures more informative and understandable,” said Robert Attmore, GASB chairman. “This new Statement extends those advancements to the reporting of pension benefits.”
After issuing Statement 50, the GASB will continue a broader research project to determine whether existing accounting standards for government pensions have been effective. Based upon constituent feedback received during that research, the Board will determine at a future date whether further changes to the current pension standards are necessary.
Statement 50 (Product Code GS50) can be ordered through the GASB’s order department at 800-748-0659 or via its website at www.gasb.org .
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