Since the original issuance of Governmental Accounting Standards Board (GASB) Statement 34 in 1999, the Office of the Washington State Auditor has found the resulting financial statement presentations to be unnecessarily complex, less timely and more costly for state and local governments to prepare and have audited. These presentations are also more challenging to understand.
Financial statements prepared by state and local government entities in the United States are longer than those prepared by other organizations in the United States and around the world, due to the use of different accounting methods (e.g. modified-accrual and full-accrual) within the presentation.
The Government Accounting Standards Board issued an invitation to comment on January 4 about potential changes to reporting of government funds, which GASB Chair Dave Vaudt recently described in a short video. The Board is seeking input on these ideas from local governments and other users during the preliminary stage of its project to re-evaluate the financial statement reporting model. Generally Accepted Accounting Principles (GAAP) for all state and local governments nationwide is set by GASB in accordance with an open, due process.
The State Auditor’s Office encourages local governments to follow the Board’s activities and provide input on potential accounting standards they will eventually need to follow.