In the
business world you can look at the audited financial statements to determine a
corporation’s financial condition. Unfortunately, you can’t do that for state governments, because tens of
billions of dollars are hidden off-balance-sheet.
For example California’s
most recent balance sheet reported that the state had net assets of $25
billion. Unfortunately, more than $70
billion of liabilities for employees’ pension and health care benefits are not
reported on the balance-sheet. Yet the
auditors correctly certified that the balance sheet was compiled using
Generally Accepted Accounting Principles (GAAP).
The
Governmental Accounting Standards Board (GASB) who sets GAAP for governments,
has issued an Invitation to Comment (ITC) on Pension Accounting and Financial
Reporting. The ITC is intended to obtain
feedback from constituents at an early stage of the Board’s reexamination of
its pension accounting and financial reporting standards.
The
Institute for Truth in Accounting will be providing our comments to the Board,
but all of our voices are needed.Please
join us in demanding that the truth be presented accurately and clearly to the
public.
Below is
GASB’s News Release regarding this invitation of comment on Pension Accounting
and Financial Reporting.
A five page
overview of the issues involved can be found at:
http://gasb.org/plain-language_documents/Pension_ITC_PLA.pdf
The Board
has also prepared a 35 page Plain Language Supplement, written using a minimum
of technical terminology, that describes in more detail the issues involved and
poses specific questions the Board is considering. This document can be found at:
http://gasb.org/plain-language_documents/pensionaccountingandfinancialreporting_plain-language.pdf
The full
Invitation for Comments can be found at: http://gasb.org/exp/itc_pension_accounting_and_financial_reporting.pdf
I know that
this may be a great deal of documents for your organization to plow through, so
I would like to offer our assistance. The Institute is available to help you and your organization in the
formation and submission of your comments. Please contact us for assistance in this important matter.
I urge you
to provide some comments to GASB on this important issue.Billions of dollars are at stake. Your state’s survival is at stake. As Thomas Jefferson said, “An informed
electorate is the basis for a sound democracy.” We believe that a large part of the states’ current financial troubles
has resulted from a mis-informed electorate.
See GASB's Press Release
