This guidance does not represent legal or investment advice. Please consult with your legal counsel regarding the interpretation of language in contracts, and other agreements.
GASB Statement No. 100, Accounting Changes and Error Corrections and GASB Statement No, 101, Compensated Absences are effective for fiscal year 2024 reporting.
BARS GAAP and Cash manuals will be updated with the new requirements in late 2024 or early 2025.
What are Accounting Changes and Error Corrections?
Defined in GASB 100, an accounting change occurs when governments implement changes in accounting principles, changes in accounting estimates, and changes to or within the financial reporting entity and describes the transactions or other events that constitute those changes. Error corrections are corrections of errors reported in prior year financial statements as a result of a mathematical mistake, mistake in application of accounting principles, or the oversight or misuse of facts that existed at the time the financial statements were issued.
The accounting and reporting changes as a result of the implementation of the accounting changes and error corrections standard will result in new BARS codes, presentation on financial statements, and updated note disclosures.
Please see our introduction videos to the right, as well as links to important resources on this topic.
What are Compensated Absences?
Defined in GASB 101, a Compensated Absence is leave for which employees may receive one or more of the following: cash payment when the leave is used for time off, cash payments for unused leave upon termination of employment, or other types of leave settlements such as conversion of leave balances to pension or other post-employment benefit plans. The payment or settlement could occur during employment or upon termination of employment. Examples of compensated absences include vacation (or annual) leave, sick leave, paid time off (PTO), holidays, and certain types of sabbatical leave. Some leaves are exempt from liability calculations until they commence such as parental leave, bereavement leave, military leave, and jury duty.
The calculated compensated absence amounts will result in a liability that both GAAP and Cash basis governments will report in their financial statements and on the Schedule of Liabilities (Schedule 09).
Training videos will be coming soon and will appear to the right, as well as links to important resources on this topic.
Get Started!
Accounting and reporting for Accounting Changes and Error Corrections and Compensated Absences is applicable in fiscal year 2024 reporting. That means if the government's fiscal year end is December 31, these changes will be reported in the 2024 annual reports filed in 2025.
So don't wait! Get started identifying these items and working on the accounting today.
As the implementation date of these two new standards gets closer, SAO will provide more detailed accounting and reporting guidance.
Please contact SAO if you have any questions via the Help Desk.