New Exposure Draft Amends Portions of GASB 34
GASB 34 was created to make annual reports easier to understand, as well as more useful, for anyone who uses governmental financial data to make decisions. However, the statement is controversial because it requires, for the first time, that public agencies use accrual accounting and that financial reports include the costs of asset ownership.
Seeking to clarify this and other areas of the statement, GASB has issued an Exposure Draft with provisions that would be approved concurrently with GASB 34.
"The Exposure Draft essentially fine-tunes a few of the provisions of Statement 34," said Ken Schermann, GASB Senior Project Manager. "All of the proposed changes are consistent with the Board’s original intentions when the Statement was written."
The new draft specifically addresses requirements for the contents of management’s discussion and analysis; the financial reporting effect of changing to the modified approach for reporting infrastructure; classification of program revenues, including fines and forfeitures; and major fund criteria.