GASB 44 and State Implementation Eric S. Berman - Deputy Comptroller Commonwealth of Massachusetts National Association of State Auditors, Comptrollers and Treasurers June 14, 2006

Statement 44 – Economic Condition Reporting States if part of GFOA CAFR program are 95% there – already doing –Financial trends –Revenue –Debt –Demographic / Economic –Operations

Key for states to focus on –OPERATING INFORMATION – why? Focus on information that is –Verifiable –Replicable –Tells the story that should be told Statement 44 – Economic Condition Reporting

OPERATING INFORMATION – basic requirements: –By GASB 34 Activity category: Number of government employees Indicators (e.g. performance measures) of the demand of level of service Indicators of capital asset usage In other words YIKES!

Statement 44 – Economic Condition Reporting Operating Items that could be gathered –DOR Tax returns transmitted electronically as a % of total –ANF Employees covered by benefit plans –DOC Counts, new offenders and released –EHS Medicaid / Food Stamp Recipients –Higher Ed Enrollment and degrees

Statement 44 – Economic Condition Reporting Sources of data in addition to the Internet –Internal metrics reports for Governor / Legislature –Bond Official Statements / Annual Updates –Budget documents –Federal grant applications

Not getting consensus on what an employee is or what is the employees home agency Not agreeing with policymakers / Secretariats up front as to what the key indicators should be for operations Think about BLENDED component units Statement 44 – Economic Condition Reporting – Keys to Success – or lack thereof

Not footnoting to sources beyond audited financials Graphs that portray the wrong message Too much data and not enough information Inconsistent periods Statement 44 – Economic Condition Reporting – Keys to Success – or lack thereof