MDG Associates of Connecticut, LLC Certified Insurance Consultants
MDG Associates of Connecticut, LLC Certified Insurance Consultants
MDG Associates of Connecticut, LLC Certified Insurance Consultants MDG Associates of Connecticut, LLC Certified Insurance Consultants
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HIPAA
WHAT ARE GASB - 43 AND GASB - 45?
  • The government equivalent to FASB - 106 and FASB - 112 for private employers
  • Require accrual of the cost of post-employment benefits other than pensions (OPEB)
  • GASB - 43 applies to benefit plans while GASB - 45 applies to employers.
  • The statements define two kinds of OPEB
    • Healthcare benefits (e.g. medical, dental, vision) regardless of how provided
    • Other forms of OPEB (e.g. life insurance, LTD, STD, LTC) that are provided separately from a defined benefit pensions plan
GASB Fact Sheet        GASB 43 & 45 Summary
GASB 43 AND 45 COMPLIANCE TIMETABLE
Phase 1 Governments (over $100 million in revenues)
Financial statements for periods beginning after 12/15/05
Phase 2 Governments ($10 - $100 million in revenues)
Financial statements for periods beginning after 12/15/06
Phase 3 Governments (under $10 million in revenues)
Financial statements for periods beginning after 12/15/07
REASONS TO COMPLY
To avoid adversely impacting bond ratings
  1. Failure to comply is tantamount to not producing a required financial statement.
  2. Rating agencies will take a dim view of this
WHAT NEEDS TO BE DONE?
  • Read and understand GASB - 43 and GASB - 45.
  • Determine data requirements needed to generate the required reports on an accrual basis.
  • Make the necessary changes in administrative systems.
    • Most administrative systems were designed with pension benefits in mind, not OPEB.
    • Substantial changes might be needed before the necessary data can be produced.
  • Work with MDG on an ongoing basis to determine whether or not the appropriate data is actually being generated and make changes as necessary before time runs out.
  • Arrange for the required accounting, actuarial and other reports to be generated.
  • A qualified actuary will be needed. MDG can arrange this.
CONCLUSION
GASB - 43 and GASB - 45 make sense and require disciplined accounting for OPEB.
  • Substantial lead time will be needed for most governments to be in a position to comply
  • Consequence of non-compliance is severe.
  • MDG is ready, willing and able to help.
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