GASB 45 Compliance Made Easy
Municipalities should never have to be burdened by the complexities associated with GASB 45. Here is a rundown of some principles to bear in mind.
GASB 45 requires governmental organizations to report the long-term liabilities associated with OPEBs being offered to retirees. These do not include pension or deferred compensation plans. GASB 45 focuses on reporting and disclosure requirements for employers. It imposes accounting rules for those employers who offer OPEB. Additionally, it requires health and welfare benefits to be booked on an accrual basis over the time period of employment.
To make the correct decisions with GASB 45, there are two retiree benefits that will need to be fully understood: funding and expensing. Pay-as-you-go is one method, but this is not very effective in the long run. It usually results in a deficit, which causes a lot of organizations to take out loans. GASB 45 guidelines do not require you to use pre-funding. When you implement GASB 45, you will not be allowed to use the pay-as-you-go method anymore.
Each governmental organization has a unique set of goals and priorities. Whether you are considering changing your plan design, updating contribution strategies or modifying your eligibility requirements, the experts at Odyssey Advisors will guide you seamlessly toward GASB 45 compliance. Your organization and employees will be more financially sound in the long run with our help.