and identifies four fiduciary funds that could be reported in state and local government financial statements: • pension (and other employee benefit) trust funds • investment trust funds • private-purpose trust funds • custodial funds Governments with activities meeting the fiduciary activity criteria should generally be reported in the basic financial statements and present a statement of fiduciary net position and a statement of changes in fiduciary net position. The first three fund types shown above are existing fund types. This statement creates a new fund category called custodial funds, which have characteristics that are different from those of its predecessor, “agency funds.” The result is that some funds that were reported as agency funds will no longer qualify as fiduciary activities. This statement is effective for reporting periods beginning after December 15, 2018. GASB STATEMENT NO. 88—CERTAIN DISCLOSURES RELATED TO DEBT, INCLUDING BORROWINGS AND DIRECT PLACEMENTS This statement was designed to improve information that is disclosed in the notes to state and local government financial statements for debt, including direct borrowings or direct placements. The statement also clarifies the scope of which liabilities should be included in the debt information disclosures. Additional
information to be disclosed includes unused lines of credit, assets pledged as collateral, events of default or termination that have finance-related consequences, and subjective acceleration clauses. Disclosures related to direct borrowings and direct placements are to be separate from other debt disclosures. This statement is effective for reporting periods beginning after June 15, 2018. GASB STATEMENT NO. 90—MAJORITY EQUITY INTERESTS: AN AMENDMENT OF GASB STATEMENTS NO. 14 AND NO. 61 This statement focuses on the reporting of state and local government majority equity interests in a legally separate organization. The statement defines a majority equity interest and requires a majority equity interest to be reported as an investment if it meets the definition of an investment (as defined by GASB Statement No. 72). Unless held by a special purpose government engaged only in fiduciary activities, a fiduciary fund or an endowment or permanent fund, the majority equity interest should be measured using the equity method. For majority equity interests in a legally separate organization that do not meet the criteria of an investment, a government should report it as a component unit. In addition, the government or fund holding the majority equity interest should report an asset related to the majority equity interest using the equity method of accounting. This statement is effective for reporting periods beginning after December 15, 2018.
Philip Marciano, CPA , a Senior Manager in the firm’s Professional Standards Group, works with the Nonprofit, Government & Healthcare Group to ensure quality control of attest engagements, including governmental audits. Philip can be reached via email at firstname.lastname@example.org or at 516.992.5841.
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