Under the new Governmental Accounting Standards Board (GASB) rules, which went into effect June 15, 2013, reporting requirements on certain contributions and budgets for cities and towns have changed significantly. In addition to reporting the year’s annual required contribution and how much has been budgeted toward its pension fund, cities and towns must also report the pension fund’s unfunded liability.
In short, this means that cities and towns will now need to keep separate and distinct pension reports to be used for various purposes. According to the National League of Cities (NLC), these reports include:
- A report on unfunded liability for city balance sheets;
- A report that documents indebtedness, and therefore creditworthiness, for the purpose of selling bonds; and
- A report that determines the annual retirement contribution that a city will have to make to keep its pension funded.
For more information on the new reporting requirements and how they may affect your city or town, please visit NLC.org.