Public Pension Accounting Revised to Reflect Tax Code Updates

States and cities have new guidance that extends pension accounting to certain other employee benefit plans.

The Governmental Accounting Standards Board issued a final rule Tuesday that better aligns financial reporting with changes to federal tax regulations. The rule, Statement No. 97, also streamlines how governments determine whether certain employee benefit plans should be reported as component units.

• Under changes to the Internal Revenue Code, some deferred compensation plans under Section 457 meet the definition of a pension plan and should be accounted for as such. The changes are intended to reduce costs and to make ...