Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
GASB 68 & 71, PERS and the Impact on Mississippi Entities
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Financial statements prepared using the economic resources measurement focus and accrual basis of accounting are required to recognize a liability for the proportionate share of the net pension liability
Pension expense and deferred outflows of resources and deferred inflows of resources related to pensions must also be recorded
Plan amounts along with proportionate share percentages will be provided by PERS – All other amounts will have to be calculated
Additional disclosures and supplemental schedules are required
Summary
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Statement No. 68 and Statement No. 71 are effective for employers and governmental nonemployer contributing entities in fiscal years beginning after June 15, 2014 (that is, for years ended June 30, 2015 or later)
Measurement Date can be no earlier than the end of the employer’s prior fiscal year, consistently applied from period to period (GASB 68, Paragraph 48)
Employers with a June 30, 2015 (Public School Districts and Community Colleges), year-end will use 2014 PERS GASB 68 Resources for Employers Reports
Employers with a fiscal year-end reporting date after July 1, 2015 (Counties), will use 2015 PERS GASB 68 Resources for Employers Reports (Will be available by December 31, 2015)
Reporting Date
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
http://www.pers.ms.gov/Pages/Home.aspx
Where to Find the Data for the Calculation
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Resources
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Auditor’s 2013/2014 Report (Schedule of Employer Allocations
and Schedule of Collective Pension Amounts)
Total Plan Net Pension Liability
Total Plan Deferred Inflows and Outflows
Total Plan Pension Expense Average Remaining Service
Life Sensitivity Analysis Disclosure Information
Total Plan Net Pension Liability
Total Plan Deferred Inflows and Outflows
Total Plan Pension Expense Average Remaining
Service Life Sensitivity Analysis Disclosure Information
Proportionate Share
Actuary’s 2014 Report(Report of the Annual GASB
Statement No. 68
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
PERS calculated the employer allocation percentage so that each entity would have a portion
This resulted in the percentages going out 6 decimal places
Management may round the proportionate share to fewer decimal places, at their discretion
The advantage to rounding is that it should help reduce changes in proportionate share in future years
Proportionate Share
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Remove the net position obligation (asset) balance determined in accordance with Statement 27, as amended, if any, and any payables to the pension plan, associated with formal commitments
Add the balance of the net pension liability (or proportionate share of the collective net pension liability), if any, as of the beginning of the initial period of implementation
Add a deferred outflows of resources balance for the government’s contributions to the pension plan made between the measurement date and the beginning net pension liability and the beginning of the entity’s fiscal year, if any
Add balances associated with all other deferred outflows of resources and deferred inflows of resources, if applicable
Components of Prior Period Adjustment
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
This spreadsheet is a tool originally prepared for internal use by the Office of the State Auditor and now provided as a template to assist in the pension calculations relating to GASB 68. It is applicable only in the year of implementation for entities with a year end of 6/30/15 or prior. Subsequent years will require additional calculations not addressed in the spreadsheet. The Office of the State Auditor assumes no responsibility for the content of this spreadsheet or for any errors or omissions related to its use. Each entity will have unique and different circumstances that may require revisions and/or additions to this template. The understanding and implementation of GASB 68, accuracy of the calculations, and recording of the applicable journal entries are the responsibility of management of the entity.
Disclaimer
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Information
Measurement Date June 30, 2014
Employer Fiscal Year End June 30, 2015
Proportionate Share from PERS 0.461324%
2014 Proportionate Share Rounded 0.46%
2013 Proportionate Share Rounded 0.46%
Employer contributions subsequent to the measurement date (Contributions from July 1, 2014-June 30, 2015)
$5,000,000
Employer contributions during fiscal year 2014 (Contributions from July 1, 2013 – June 30, 2014)
$4,460,501
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template - Summary
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template – Deferred Outflows
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template – Deferred Inflows
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template – Pension Expense
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template – Sensitivity Analysis
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template - Journal Entries
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Example Template – Journal Entries
*The entry should be a debit to deferred outflows - pensions and a credit to cash/payable. The way that the contributions subsequent to the measurement date were initially recorded during the year will dictate the credit side of the entry. The initial debit entry will need to be reversed to properly reflect the amount of deferred outflows. This entry will vary by entity. (Will be closed out to net pension liability in the subsequent year.)
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
Recognition on the Statement of Net Position and Statement of Activities
Additional note disclosures Supplementary Schedules
Schedule of the District’s Proportionate Share of the Net Pension Liability
Schedule of District Contributions
Changes to Report
Stacey E. Pickering
Mississippi State Auditor
Stacey E. PickeringMississippi State Auditor
GASB 68, Accounting and Financial Reporting for Pensions
GASB 71, Pension Transition for Contributions Made Subsequent to the Measurement Date
GASB 68 Implementation Guide AICPA Whitepaper – Governmental
Employer Participation in Cost-Sharing Multiple-Employer Plans: Issues Relating to Information for Employer Reporting
Other Implementation Resources