New Rule Makes States, Local Governments Show Retiree Costs On Books
New rules approved by the Governmental Accounting Standards Board will require states and municipalities to disclose the cost of health insurance and other benefits, besides pensions, in their financial statements, rather than in the footnotes.
The Wall Street Journal:
Government Retiree Costs To Be Put In The Spotlight
State and local governments will have to add hundreds of billions of dollars in retiree obligations to their books under rules enacted Tuesday that spotlight the growing costs of health insurance and other benefits owed to former municipal employees. The new rules approved unanimously by the Governmental Accounting Standards Board, which sets accounting rules for states and municipalities, will require governments to carry their unfunded retiree-benefit obligations on their balance sheets—thus making their overall financial position look worse. Currently, governments are required only to disclose the benefit costs in the footnotes to their financial statements. (Rapoport, 6/2)
Accounting Rule To Force U.S. Cities To Report Health Care Bills
U.S. state and local governments will have to report billions of dollars in health-care liabilities on their balance sheets under an accounting change aimed at improving disclosure of retiree benefits. As a result of rules approved Tuesday by the Governmental Accounting Standards Board, municipalities and states will have to record the cost of health insurance and other benefits besides pensions in financial statements, the board said in a statement. Such costs are currently disclosed only in footnotes. (Preston, 6/2)