Governmental Accounting Standards Board (GASB) Statement 65 (GASB 65), Items Previously Reported as Assets and Liabilities
Summary: GASB 65 was issued in March 2012. It identifies transactions currently classified as assets or liabilities that should be reclassified as either deferred outflows of resources or deferred inflows of resources. It also provides for the term “deferred” to be limited to deferred inflows and deferred outflows and amends the criteria for determining major funds to include deferred outflows and deferred inflows. GASB 65 is effective beginning 2013–14.
The CDE expects the impact of GASB 65 on local educational agencies (LEAs) to be minimal. There are a few transactions identified that may require LEAs to reclassify certain assets or liabilities as deferred outflows or deferred inflows of resources, but these transactions probably occur infrequently.
Background: GASB Concepts Statement 4, Elements of Financial Statements, identifies two new financial statement elements – deferred outflows of resources and deferred inflows of resources. Concepts Statement 4 also specifies that recognition of these financial statement elements should be limited to instances specifically identified in GASB authoritative pronouncements. GASB 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position, provides financial statement presentation guidance for deferred outflows and inflows of resources but does not specifically identify items that should be recognized as such.
Implications for local educational agencies (LEAs): As noted above, GASB 65 identifies transactions to be reclassified as deferred outflows or deferred inflows of resources that may be applicable for LEAs, including but not limited to:
Deferred outflows of resources:
- Resources advanced to another government in relation to a government-mandated nonexchange transaction or a voluntary nonexchange transaction when a time requirement is the only eligibility requirement that has not been met by the other government
- Deferred debit amounts resulting from the refunding of debt
Deferred inflows of resources:
- Resources received in advance in relation to a government-mandated nonexchange transaction or a voluntary nonexchange transaction when time requirements are the only eligibility requirement that has not been met by the receiving government
- Resources associated with imposed nonexchange revenue transactions before:
- The period for which property taxes are levied
- The period when resources are required to be used or when use is first permitted for all other imposed nonexchange revenues that have a time requirement
- The period for which property taxes are levied
- Deferred credit amounts resulting from the refunding of debt
- Unavailable revenue (governmental funds only)
