- What is GASB?
- What does the Governmental Accounting Standards Board (GASB) hope to accomplish with these regulations?
- When did Statement No. 67 go into effect?
- When did Statement No. 68 go into effect?
- What do I need to do with the GASB Statement No. 68 Information?
- Will employers have to pay more each year for pensions because of these GASB standards?
- If required contributions have been paid in full, why is it necessary to record a liability?
- How do I figure out the information that needs to be reported?
- How is my proportionate share determined?
- How is the net pension liability calculated?
- When am I able to view the GASB Statement No. 68 data each year?
- Why doesn’t the amount listed as “Employer’s Contributions” in the GASB information match my payment?
- What if I do not have the ten years of consecutive contributions data or covered-employee payroll information that should be included in the Required Supplementary Information — Schedule of Contributions employer note disclosure?
- Does NYSLRS provide comparative GASB Statement No. 68 information for employers who prepare comparative financial statements?
- Who do I contact if I need additional information or have any questions?
GASB is an acronym for the Governmental Accounting Standards Board, which is the source of generally accepted accounting principles used by state and local governments such as the New York State & Local Retirement System (NYSLRS, or the System). All state and local government employers participating in the System that follow generally accepted accounting principles (GAAP) are required to implement these provisions.
The objective is to improve financial reporting by state and local governmental pension plans and participating employers. Employers, who previously had no reporting responsibility related to pension liability/assets, will now include their proportionate shares of the Net Pension Liability on their financial statements, as well as other statistics such as pension expense and deferred inflows/outflows.
The provisions in Statement No. 67 are effective for financial statements for periods beginning after June 15, 2013. For NYSLRS, this was the April 1, 2014 – March 31, 2015 fiscal year.
The provisions in Statement No. 68 are effective for the fiscal years beginning after June 15, 2014 and are dependent on the individual employers’ fiscal year end. You can consult this implementation chart to find out when you were required to implement Statement No. 68.
If you prepare financial statements in accordance with Generally Accepted Accounting Principles (GAAP), you may need to follow GASB guidance and comply with GASB Statement No. 68. If you do not prepare financial statements in accordance with GAAP, you may not need to follow GASB guidance. We suggest you check with your auditor or accountant.
For additional information, please read The Office of the State Comptroller’s Division of Local Government and School Accountability Bulletin — Accounting and Financial Reporting for Pensions as Required by GASB 68.
No. NYSLRS will continue to provide annual bills to you based on actuarially determined contribution rates. The change resulting from the standards is an accounting change — you need to report a liability or asset representing the funding deficit or surplus attributable to the employer.
The measure of pension expense prior to GASB Statements No. 67 and 68 was your annual required contributions to NYSLRS. If you paid your required contributions, you had no additional liability to NYSLRS. These standards require that employers report their proportionate share of the collective net pension liability to the extent that total plan pension liability exceeds plan net assets.
GASB's position is that government employee pensions are a component of the employment relationship between the employer and employee; they are part of the employee compensation package. The employer’s participation in a pension plan provided by a separate entity or pension system, such as NYSLRS, does not limit the employer’s responsibility for the cost of these future pension benefits.
If the total pension liability of the separate pension system is not 100 percent funded, employers have a liability for the unfunded portion of the pension benefits earned by their employees to date. This liability should be recognized in the employer’s financial statements along with an associated pension expense.
NYSLRS annually calculates your proportionate share percentage and dollar amounts, net pension liability, pension expense, deferred inflows/outflows and other related disclosures. Calculations are based on current actuarial and financial information. In addition, we guide you with footnote disclosures.
This information is available in Retirement Online. Sign in to your Retirement Online account. From your Account Homepage, click the “Access Billing Dashboard” button. After choosing your location code and retirement system (ERS or PFRS), scroll down and click the ‘Governmental Accounting Standards Board (GASB)’ link.
Proportionate shares are based on the proportion of the actuarial present value of future employer billing salary to the actuarial present value of future system billing salary.
The net pension liability represents the difference between the pension plan’s total pension liability, based on actuarial valuations and the assets currently available within the plan to pay that liability.
The year-to-year GASB Statement No. 68 information that we provide will be available in Retirement Online each summer.
The “Employer’s Contributions” amount reflects Regular Pension Contribution, including Group Life Insurance Plan (GLIP) and Adjustments. It does not include payments made for Amortizations or Incentives; these amounts were recorded by NYSLRS when the amounts were initially due.
What if I do not have the ten years of consecutive contributions data or covered-employee payroll information that should be included in the Required Supplementary Information — Schedule of Contributions employer note disclosure?
According to GASB Statement No. 68, this disclosure can be treated prospectively, i.e. employers are allowed to start with the current year and add additional years until the required number of years is reached. The payroll for the employer’s fiscal years can be accumulated the same way. For an example, see Illustration 3 in GASB Statement No. 68. Please note that according to paragraph 81(b) of GASB Statement No. 68, employers are responsible for maintaining and reporting this information as of their most recent fiscal year end.
No. NYSLRS implemented GASB Statement No. 67 beginning with the fiscal year ending March 31, 2015 financial statements, and provided GASB Statement No. 68 information for employers.
Employers should look for guidance from external auditors and other sources to evaluate the impact of GASB Statement No. 68 on the Management’s Discussion and Analysis (MD&A) and comparative footnote disclosures.
Please use our help desk form to contact NYSLRS accounting staff if you have any questions (choose “Governmental Accounting Standards Board (GASB) Reporting” from the drop-down). You may also wish to consult with an independent auditor or your own accountant about these GASB standards and their requirements.