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Monday, November 24, 2008

New FASAB Exposure Drafts

FASAB Releases Exposure Draft on Social Insurance

The Federal Accounting Standards Advisory Board (FASAB) is seeking input on the exposure draft Social Insurance Accounting, Revised. Social Insurance comprises five programs; however, two programs, Social Security and Medicare, are of special significance because of the high rate of participation among citizens, the fiscal challenges related to the programs, and the challenges associated with incorporating estimates of future cash flows of this magnitude in financial statements.

From the outset, members have agreed on the objectives of financial reporting for social insurance programs but have had different views about how best to achieve the objectives and about the timing of the recognition of expense and liability for social insurance programs.
Chairman Tom Allen says that "this exposure draft represents a compromise. It proposes enhanced reporting but does not resolve the two strongly held views regarding when the obligating event occurs for social insurance programs and, thus, when the liability and expense definitions are met within those programs." Comments on the exposure draft are due by Feb. 9, 2009.

FASAB Releases ED on Estimating the Historical Cost of General Property, Plant and Equipment

The FASAB is seeking input on an exposure draft, Estimating the Historical Cost of General Property, Plant, and Equipment--Amending Statements of Federal Financial Accounting Standards 6 and 23.This Statement proposes to clarify that reasonable estimates of original transaction data historical cost may be used to value general property, plant, and equipment. Comments on the exposure draft are due by Jan. 30, 2009.

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