GASB Concludes Pension Standards Achieved Objectives

More than a decade after they were approved by the Governmental Accounting Standards Board (GASB), a post-implementation review (PIR) report released on June 3 found that the board’s pension standards—GASB 67 and GASB 68—met their goals.

After each governmental accounting standard is issued, the GASB provides educational support, responds to technical inquiries, and often issues questions and answers about the standard through implementation guidance. More complex standards—like Statements 67 and 68—are eligible to undergo more extensive PIR procedures culminating in a final report, the GASB said.

In June 2012, the GASB approved Statement No. 67, Financial Reporting for Pension Plans, which applies to pension plans that administer pension benefits, and Statement No. 68, Accounting and Financial Reporting for Pensions, which applies to governments that provide pension benefits to their employees. GASB issued the standards to provide the transparency, consistency, and comparability of the pension information reported by state and local governments and pension plans.

The provisions in Statement 67 became effective for financial statement periods beginning after June 15, 2013, while the provisions in Statement 68 went into effect for fiscal years beginning after June 15, 2014.

The PIR report issued by GASB staff on Monday concludes that Statements 67 and 68 met the three PIR objectives:

• The standards accomplish their stated purpose,
• Costs and benefits are in line with expectations, and
• The board followed its standard-setting process.

Beginning in October 2014, the GASB began the PIR process on the newly issued pension standards. The three stages of the PIR process include the following:

• Stage 1. Post-issuance date implementation monitoring.
• Stage 2. Post-effective date evaluation of costs and benefits.
• Stage 3. Summary of research and reporting.

“Stage 1 began after the issuance of the pronouncements and continued for more than three years after the effective date of the standards. With effective dates of fiscal years beginning after June 15, 2013, for Statement 67 and after June 15, 2014, for Statement 68, Stage 1 activities continued through 2017. Stage 2 PIR activities started in 2017 and concluded in the fourth quarter of 2023. Stage 3 is complete with the submission of this report,” the GASB said in the report.

GASB staff concluded: “[W]e believe that the due process that led to the issuance of Statements 67 and 68 was exhaustive and robust, and we have no recommendations for improvements to the standard-setting process.”