Hop on the Omnibus: GASB Statement 99
- Dean Michael Mead
Oct 25, 2022
Earlier this year, the Governmental Accounting Standards Board (GASB) issued Statement No. 99, Omnibus 2022. Like any other Statement, this Omnibus contains authoritative, generally accepted accounting principles that state and local governments must follow. Unlike other Statements, this and prior Omnibus Statements simultaneously address multiple issues that have arisen in practice and often are unrelated. That may be confusing when trying to figure out what is required and whether it applies to your government. Here are answers to five common questions about the new Statement.
What Is an Omnibus?
As governments and their auditors work to implement GASB standards, questions often arise about how they apply to governments’ specific facts and circumstances. Most of the time, the GASB can answer frequently asked questions by publishing an Implementation Guide. But sometimes, the GASB must make changes to the standards themselves to resolve an implementation issue. When a need arises to provide guidance imminently, the GASB uses an Omnibus to address such multiple problems that have accumulated but wouldn’t merit a Statement of their own individually.
What Prompted GASB to Issue This Omnibus?
GASB Statement No. 87, Leases, contains fairly complex standards that governments have had to invest significant time to understand and implement. Unsurprisingly, governments and their auditors have raised many questions about those standards. An entire Implementation Guide was published just for the leases standards, and additional questions and answers were included in the Implementation Guidance Updates for 2020 and 2021.
Statement 87 and its related implementation guidance have to be implemented for fiscal years ending June 30, 2022, and after. Two other pronouncements based essentially on the same guidance as leases include Statement No. 94, Public-Private and Public-Public Partnerships and Availability Payment Arrangements (P3s) and No. 96, Subscription-Based Information Technology Arrangements (SBITAs). Both have the same relevant practice issues and are effective a year later—June 30, 2023, and after. The need to provide that guidance in time for implementing the P3 and SBITA standards led the GASB to develop Statement 99.
Other Topics Statement 99 Covers Besides Leases, P3s, and SBITAs
|What Statement 99 Does
|Exchange and exchange-like financial guarantees
|Applies the guidance from Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial Guarantees
|Derivative instruments that are neither investments nor hedges
|Creates a third category, other derivative instruments, and explains how to report them
|Deadline for removing the London Interbank Offered Rate (LIBOR) from the derivative instruments standards
|Changes the deadline in response to the sunset date of LIBOR being extended
|Supplementary Nutrition Assistance Program (SNAP)
|Eliminates the existing guidance for Food Stamps in favor of applying nonexchange transaction guidance
|Nonmonetary transaction disclosures
|Replaces a required disclosure with an explanation of how transferred assets were measured
|Intra-entity pledges of future revenues
|Provides guidance to avoid double-counting transactions between a government and its blended component units
|Focus of the government-wide financial statements
|Clarifies that a total primary government column always is required
|Replaces a variety of outdated language in existing standards
Will It Be Difficult To Implement the New Standards?
The general answer to this is no. The lease, P3, and SBITA provisions resolve practice issues rather than add to the implementation burden. The other provisions affect relatively few governments and would require little or no effort by those governments; the provisions for other derivative instruments may require a small effort.
How To Figure Out If Statement 99 Applies To Your Government?
The best way to determine if Statement 99 applies to your government is to start by reading Statement 99, which is a relatively brief document. From there, reach out to CRI . We’re here to help you determine what provisions of Statement 99, if any, apply to your government and are ready to help you comply with those that do.