Agenda - 01-22-2019 8-a - Minutes

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18 1 statements of state and local governmental entities in conformity with GAAP and 2 the framework for selecting those principles. 3 4 5 - GASB Statement No. 83, Certain Asset Retirement Obligations, requires the 6 accrual of an estimate for any legally enforceable future liability associated with 7 the retirement of a capital asset (i.e. decommissioning a sewer treatment plant) 8 and to report the expenses over the life of the associated capital asset. 9 Applicable for June 30, 2019. 10 11 12 - GASB Statement No. 84, Fiduciary Activities, This statement establishes 13 criteria for identifying fiduciary activities with a focus on: 1) whether a 14 government is controlling the assets of the fiduciary activity; and, 2) the 15 beneficiaries with whom a fiduciary relationship exists. Applicable for June 30, 16 2020. 17 18 19 New GASB Pronouncements for Future Years 20 21 - GASB Statement No. 87, Leases was issued in June 2017 and is 22 effective for the first reporting period beginning after December 15, 23 2019. This statement increases the usefulness of governments' financial 24 statements by requiring recognition of certain lease assets and liabilities 25 for leases that previously were classified as operating leases and 26 recognized as inflows of resources or outflows of resources based on the 27 payment provisions of the contract. It establishes a single model for 28 lease accounting based on the foundational principle that leases are 29 financings of the right to use an underlying asset. Under this statement, 30 a lessee is required to recognize a lease liability and an intangible right-to- 31 use lease asset, and a lessor is required to recognize a lease receivable 32 and a deferred inflow of resources, thereby enhancing the relevance and 33 consistency of information about governments' leasing activities. 34 Applicable for June 30, 2021. 35 36 - Statement No. 88, Certain Disclosures Related to Debt, Including Direct 37 Borrowings and Direct Placements, under Statement 88, debt for 38 disclosure purposes is defined as a liability that arises from a contractual 39 obligation to pay cash (or other assets) in one or more payments to settle 40 an amount that is fixed at the date the contractual obligation is 41 established. Applicable for June 30, 2019. 42 43 44 - Statement 89, Accounting for Interest Cost Incurred Before the End of 45 a Construction Period, this standard eliminates the requirement/ability to 46 capitalize construction period interest costs as part of the cost of a capital 47 asset in enterprise funds. This standard should be applied prospectively 48 with no restatement. This standard can be early implemented as part of 49 fiscal year 2019, but is applicable for June 30, 2021.