Beginning with June 30, 2015 fiscal year ends, units of local governments will be required to implement GASB 68 – Accounting and Financial Reporting for Pensions - an amendment of GASB Statement No. 27 (GASB 68) and GASB Statement No. 71 – Pension Transition for Contributions Made Subsequent to the Measurement Date—an amendment of GASB Statement No. 68 (GASB 71). By now, you have likely discussed this standard with your pension plan servicers, auditors, and peers.
GASB 68 and GASB 71 provides accounting and financial reporting pension guidance to employers whose employees belong to a pension plan(s) covered by these standards. Employers fall into one of the following categories for purposes of these standards: 1) single employers, 2) agent employers and 3) cost-sharing employers. This guide uses an Illinois local government that participates in the Illinois Municipal Retirement Fund (IMRF), an agent-multiple employer plan, or sponsors a Police or Firefighters’ pension which is a single employer plan as an example. State and local governments participating in a different agent multiple-employer plan or single employer plan may also find this information useful.
Minimizing the impact on your organization
The implementation of GASB 68 and GASB 71 will be a challenging task for most governments. To minimize the impact on your government, proper planning, templates, and early discussions with your audit team are highly recommended. We also recommend early communication with your actuaries to develop a timeline that ensures valuation delivery prior to the beginning of audit fieldwork.
For more information on this topic, or to learn how Baker Tilly state and local government specialists can help, contact our team.