In the wake of COVID-19, the Governmental Accounting Standards Board (GASB) has released a draft proposing delays for the implementation of many accounting standards for fiscal years 2019 and beyond.
Key insights
- Nearly all accounting standards due to be implemented for fiscal years 2019 and later could be postponed.
- GASB could vote on final decision as soon as next month.
- Project plan comment periods, public hearings, and user forums are delayed as stakeholders focus on COVID-19 concerns.
GASB issued a proposed statement to postpone effective dates
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Amidst COVID-19 disruptions, stakeholders have asked the Governmental Accounting Standards Board (GASB) to consider delaying the effective date of soon-to-be-effective standards. In response, GASB issued an exposure draft proposing postponed effective dates of almost all accounting standards due to be implemented for fiscal years 2019 and later.
The standards below are expected to provide the most relief to state and local governments:
| Standard | New effective date (proposed) |
|---|---|
| Statement No. 84 Fiduciary and IG 2019-2 | Reporting periods beginning after December 15, 2019 |
| Statement No. 87 Leases and IG 2019-3 | Fiscal years beginning after December 15, 2020 |
GASB’s exposure draft, Postponement of the Effective Dates of Certain Authoritative Guidance, has the full list of potentially impacted pronouncements that may affect your organization. Early adoption will be permitted for governments who wish to implement statements based on their original effective dates.
In order to offer relief as soon as possible, GASB has shortened the comment period for the exposure draft to 15 days. The comment period ends April 30, 2020. GASB staff can then collect feedback, allowing the board to vote on issuance of the proposed statement as soon as next month.
GASB COVID-19 tool box
The GASB website addresses accounting topics that could be relevant to governments during COVID-19. Thankfully, we don’t experience COVID-type circumstances frequently; therefore, financial statement preparers may be less familiar with some of the accounting topics listed in the GASB Emergency Toolbox. The toolbox is organized by topic, with codification sections to easily find relevant information. Topics include capital asset impairment, subsequent events, estimation of uncollectible amounts, extraordinary, and special items, and many others. The list is not all-inclusive, but is helpful to review.
Lengthened project plan timeline
During the April 14 board meeting, members voted to approve the project plan and extend the timeline of various projects. The board and staff recognize that stakeholders are focused on pandemic-related activities and are not able to place high priority on commenting and offering feedback during GASB outreach. Therefore, comment periods, public hearings, and user forums are delayed. Updated project plan information is available on the GASB website.
How we can help
CLA can help you determine the appropriate accounting to record the impact of COVID-19, assess your accounting and reporting controls in a distance environment, and help you navigate the various funding sources and requirements. Please get in touch if you need any assistance during this time.