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GASB 73, 74, and 75 Statement Overview

OnDemand Webinar (88 minutes)

Are you prepared for the new GASB statement requirements that may result in larger liabilities?States and local governments face increasing challenges with accounting and financial reporting for pensions and other postemployment non-pension benefits (OPEB). Having settled in with GASB statements 67 and 68 for pensions and GASB statements 43 and 45 for OPEB, GASB changed and complicated the accounting and financial reporting rules over the past three years with GASB statements 73, 74 and 75. The new GASB statements require actuarial calculations, assumptions projections and new disclosures that result in larger liabilities than previously calculated under superseded GASB statements and, including these larger liabilities in balance sheet and income statements, no longer hidden in the notes of financial statements. Are investors better protected under the information required by GASB statements 73, 74 and 75? How will budgets need to be revised to comply with the new GASB statements? Will state/local government failure to comply give rise to failure to disclose material information, the risk of securities fraud liability through SEC investigation, or difficulty or additional expense in accessing capital market for public infrastructure? Asking these questions shed light on likely answers.


Kenneth W. Bond, Squire Patton Boggs LLP


GASB, Pensions and OPEB

  • What Is GASB and Why Are Its Statements Important to State/Local Government Finance
  • What Are Public Sector Pensions - How GASB Statement 73 Supersedes Statements 67 and 68
  • What Is OPEB - How GASB Statements 74 and 75 Supersede Statements 43 and 45

From Notes on Financial Statements to the Balance Sheet and Income Statement

  • GASB 67 and 68 Apply to Public Sector Pensions Administered by Trusts or With Assets
  • GASB 73 Applies to Public Sector Pensions Not Covered by Assets or Trust Administered
  • GASB 43 and 45 Apply to OPEB in Terms of Unfunded Liability and Required Annual Contribution
  • GASB 74 and 75 Treat OPEB as a Net Liability - a Bigger Number Than Unfunded Liability
  • GASB 73 - Pension Liabilities/Expenses on Balance Sheets and Income Statements Since 2014
  • GASB 74/75 OPEB - Liabilities/Expenses on Balance Sheets and Income Statements Since 2017

GASB's Objectives in Statements 73,74 and 75

  • Transparency - Don't Hide the Lack of Assets Behind Pensions and OPEB Liabilities
  • Disclosure - Include Pensions and OPEB Labilities in Financial Statement Net Positions
  • Assumptions - Required to Be Calculated and Disclosed in Measuring Liabilities
  • Explanations - Required Methodology for Determining Liability Changes and Projections
  • Ratios - Disclose Asset Resources Available for Pensions and OPEB Liabilities
  • Transactions - Disclose Benefits and Contributions
  • Discount Rate - Determine If Net Position Sufficient to Make Projected Benefit Payments
  • Single Method - to Determine Actuarial Present Value and Immediate Expense Recognition

Compliance and Risks of Noncompliance

  • No Safe-Harbor for Small Local Governments
  • Liabilities in Balance Sheets and Income Statements Threaten Credit Ratings
  • Mistakes in Calculations May Be Material Misstatements or Omissions - 10(b)(5)
  • Material Mistakes Made Through Severe Recklessness Invite Securities Fraud
  • Weighting the GASB Burden Against Protecting Investors
  • Financing Liabilities - a Prudent Future Option?
  • Budget Preparation and Projections Should Take Into Account GASB 73, 74 and 75
  • Responses From GFOA and State/Local Government Trade Associations

Additional Formats

Audio & Reference ManualMore Info
MP3 DownloadMore Info