Pensions: Making the Number Our Own

Source: Bob Scott, Government Finance Review, Vol. 30 no. 4, August 2014
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With the implementation of Governmental Accounting Standards Board Statement No. 68, Accounting and Financial Reporting for Pensions, about a year away, it is time to focus on what preparers of employer financial statements will have to do in order to implement this complex standard. Many employers know very little about the huge number we are about to record in our financial statements. This article will discuss the challenge employers face in standing behind a complex pension expense number that they did not prepare. We will then discuss the best practice solutions published by the American Institute of CPAs’ Government Audit Quality Center, which preparers can also use to gain understanding and assurance regarding what could be the largest number in our financial statements. And finally, we will discuss steps every employer should take to better understand both their pension plan and the public employee retirement system that administers it. …