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Vadnais Lake Area Water Management Organization <br />March 19, 2008 <br />Page 9 <br />Future Accounting Standard Changes <br />The following Governmental Accounting Standards Board (GASB) Statements have been issued and may have an impact on <br />future Organization's financial statements: <br />GASB Statement No. 45 - Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than <br />Pensions <br />This statement is effective in three phases based on a government's total annual revenues in the first fiscal year ending after <br />June 15, 1999: <br />• Governments that were phase 1 governments for the purpose of implementation of Statement No. 34 - those with <br />annual revenues of $100 million or more - are required to implement this Statement in financial statements for <br />periods beginning after December 15, 2006. <br />• Governments that were phase 2 governments for the purpose of implementation of Statement No. 34 - those with <br />total annual revenues of $10 million or more but less than $100 million - are required to implement this Statement in <br />financial statements for periods beginning after December 15, 2007. <br />• Governments that were phase 3 governments for the purpose of implementation of Statement No. 34 - those with <br />total annual revenues of less than $10 million - are required to implement this Statement in financial statements for <br />periods beginning after December 15, 2008. <br />Statement No. 45 gives the following summary, "In addition to pensions, many state and local governmental employers <br />provide other postemployment benefits (OPEB) as part of the total compensation offered to attract and retain the services of <br />qualified employees. OPEB includes postemployment healthcare, as well as other forms of postemployment benefits (for <br />example, life insurance) when provided separately from a pension plan. This Statement establishes standards for the <br />measurement, recognition, and display of OPEB expense/expenditures and related liabilities (assets), note disclosures, and, if <br />applicable, required supplementary information (RSI) in the financial reports of state and local governmental employers." <br />GASB Statement No. 48 - Sales and Pledges of Receivable,s and Future Revenues and Intra-Entity Transfers of Assets and <br />Future Revenues <br />This statement was issued September 2006 and is effective for periods beginning after December 15, 2006. Therefore, this <br />statement has been implemented for the current financial statements. <br />This standard provides accounting guidance for when certain transactions -such as the sale of delinquent taxes, certain <br />mortgages, student loans, or future revenues such as those arising from tobacco settlement agreements -should be regarded as a <br />sale or a collateralized borrowing. The financial reporting question addressed in Statement No. 48 is whether such <br />transactions should be reported as a sale or collateralized borrowing. <br />In addition to clarifying guidance on accounting for sales and pledges of receivables and future revenues, Statement No. 48 <br />(1) requires enhanced disclosures pertaining to future revenues that have been pledged or sold; (2) provides guidance on the <br />sales of receivables and future revenues within the same financial reporting entity; and (3) provides guidance on recognizing <br />other assets and liabilities arising from the sale of specific receivables or future revenues. <br />952.835.9090 • Fax 952.835.3261 <br />www.aemcpas.com <br />