FASAB proposes clarification on loss allowance for intragovernmental receivables
The Federal Accounting Standards Advisory Board staff released an exposure draft of a technical bulletin that would clarify the existing standards for loss allowances for intragovernmental receivables.
The proposed Technical Bulletin 2019-1 would clarify that the recognition of losses, provided in paragraphs 41-51 of SFFAS 1, Accounting for Selected Assets and Liabilities, applies to both intragovernmental receivables and receivables from nonfederal entities.
The proposed TB also would clarify that an allowance recognized in a reporting entity’s financial statements does not alter the underlying statutory authority to collect the receivable or legal obligation of the other intragovernmental entity to pay.
“The proposal will resolve any uncertainties that may exist in current standards regarding loss allowance for intragovernmental receivables,” said FASAB executive director Monica R. Valentine in a statement.
FASAB is asking for comments on the exposure draft by Oct. 1, 2019.