The Governmental Accounting Standards Board has updated its standards for the reporting of certain financial instruments and external investment pools by government entities.
Statement No. 59, known as the Financial Instruments Omnibus, is effective for financial statements prepared by state and local governments for periods beginning after June 15, 2010, with earlier application encouraged.
Statement 59 addresses significant practice issues that have arisen when accounting for financial instruments, said GASB Chairman Robert H. Attmore in a statement. By increasing the consistency of measurements and providing clarification of existing standards, this guidance will improve financial reporting in ways that benefit both users and preparers of financial reports.
Statement 59 emphasizes the applicability of Securities and Exchange Commission requirements to certain external investment poolsknown as 2a7-like poolsto provide users more consistent information on qualifying pools. It also addresses the applicability of Statement No. 53, Accounting and Financial Reporting for Derivative Instruments, to certain financial instruments to clarify which financial instruments are within the scope of that pronouncement and to provide greater consistency in financial reporting.
In addition, the statement applies the reporting provisions for interest-earning investment contracts of Statement No. 31, "Accounting and Financial Reporting for Certain Investments and for External Investment Pools," to unallocated insurance contracts to improve the consistency of reporting by pension and other post-retirement employee benefit plans.
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