Last updated: August 20. 2014 2:54PM - 282 Views
By Sydney L. Murray smurray@civitasmedia.com



Story Tools:

Font Size:

Social Media:

EATON — In June 2012, the Governmental Accounting Standards Board approved two statements that will change the financial reporting of pension liabilities.


According to a GASB press release, Statement 67 “addresses financial reporting for state and local government pension plans. Statement 68 establishes new accounting and financial reporting requirements for governments that provide their employees with pensions.”


Eaton Community Schools Treasurer Priscilla Dodson said she is unsure at the moment how these new statements will affect the school system.


“We don’t know how that’s going to impact us at this point, it’s so new,” Dodson said. “If it does, I really don’t think it’s going to do much to us or for us.”


City of Eaton Finance Director Stephanie Risner said Statement 67 won’t have too much of an impact on the city. She said Statement 67 will affect more of the actual retirement systems, the Ohio Public Employees Retirement System, Ohio police and fire departments, school district school employees’ retirement systems and state teachers’ retirement systems.


Risner said Statement 68 only impacts what information will go on the city’s financial statements and doesn’t affect the city’s cash position.


“So this GASB doesn’t affect what’s coming in and out of our bank accounts,” Risner said. “We still are contributing the same thing.”


Risner said the city is required to contribute a certain percentage of employees’ pay into the retirement systems. The city contributes 14 percent of employees’ pay for PERS, 19.5 percent for police officers and 24 percent for fire employees.


Risner said the city will now have to recognize their portion of the liability for where those retirement systems may not be fully funded.


“What they’ll do, those retirement systems will tell us this is the portion of that liability, and you have to put it on your financial statements,” Risner said. “It doesn’t mean we have to contribute more money, it’s just gonna show that we have a liability.”


Risner said these changes will reduce the city’s equity in its financial statements, but not its actual equity in the bank.


“On the actual balance sheet you would see a liability for the unfunded portion and then the expenditure that is associated with that liability would run through the individual departments in proportion with their payroll,” Risner said.


Risner said Eaton won’t really have to begin worrying about this change until the beginning of 2016 when they are doing their financial statements. The statements don’t actually apply until Eaton has a fiscal year beginning after June 15, 2014.


“It’s only a expenditure on paper, it’s not an actual expenditure that we’ll have to pay for,” Risner said. “So there will be additional disclosures in our financial statements that we issue every year.”


Risner said she has participated in webinars through Ohio PERS and also attended auditors’ trainings in conjunction with these new statements. Risner said the city will work with Donald J. Schonhardt and Associates to help them with their financial statements, as well as with Ohio PERS and Ohio police and fire departments to get those numbers that will have to be reflected in the financial statements.

Comments
comments powered by Disqus


Featured Businesses


Poll



Info Minute



Gas Prices

Eaton Gas Prices provided by GasBuddy.com