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GASB 68 Valuation, Measurement and Report Dates, Oh My!

It’s here! GASB 68, the much anticipated Pension Statement, is effective for employer governments for this June 30, 2015 ending year. Amongst all the hype is a barrage of changes to the way governments have been reporting their pensions. This blog focuses on the three different dates involved, specifically for Arizona based pension plans.

There are three dates to understand: the actuarial valuation date, measurement date and the government employer fiscal year-end report date. In some instances these dates may all be the same, and in some instances these dates may all be different. For the Arizona State Retirement System (ASRS) and the Public Safety Personnel Retirement System (PSPRS), as well as other Arizona pension plans, these dates will all be different dates. If you are in a different State, your Pension Plan will most likely indicate what dates to use for your plan.

Your pension liability is determined by an actuarial valuation as of the measurement date or roll forward procedures applied to the actuarial valuation date to the measurement date. However, your actuarial valuation date cannot be earlier then 30 months and 1 day from your fiscal year end date and your measurement date can be no earlier than the end of your prior fiscal year. Confused? Let’s use an example.

In the first year of implementation for ASRS, PSPRS or other Arizona pension plans, your report date will be 6/30/2015, the measurement date will be 6/30/2014, and the actuarial valuation date will be 6/30/2013. That means the actuaries for the plan valued the liability as of 6/30/2013. Then the plan, with the help of the actuaries, applied roll forward procedures to come up with a liability as of 6/30/2014. That liability is what you, the employer government, will report in your 6/30/2015 financial report. You may notice that the actuarial valuation date is only 24 months prior to your current year-end date, and the measurement date is exactly 12 months earlier than your current year-end date. Therefore, this meets the requirements of GASB 68.

Still confused? I imagine some may be, and if that is the case, or you want to learn more about the plethora of changes effecting your 6/30/2015 statements as a result of GASB 68, I encourage you to attend our free live 2.5 hour learning session here at our office in Tempe, Arizona on April 29, 2015 from 8:00am – 10:30am. Can’t make it to the live event? Sign up for our live webinar at the same time and listen in from the comfort or your office or home. To be included on the invite, please contact Chelsea Kreger at chelseak@hhcpa.com. The deadline to RSVP is April 27, 2015. I hope to see, or hear you there.

By Brian Hemmerle, CPA, CFE