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Elk River Municipal Utilities <br /> May 6,2013 <br /> Page 8 <br /> Future Accounting Standard Changes-Continued <br /> GASB Statement No.67- The Financial Reporting for Pension Plans-an Amendment to GASB Statement No. 25 <br /> Summary <br /> The objective of this Statement is to improve financial reporting by state and local governmental pension plans. This Statement <br /> results from a comprehensive review of the effectiveness of existing standards of accounting and financial reporting for pensions <br /> with regard to providing decision-useful information,supporting assessments of accountability and interperiod equity,and <br /> creating additional transparency. <br /> This Statement replaces the requirements of Statements No. 25,Financial Reporting for Defined Benefit Pension Plans and Note <br /> Disclosures for Defined Contribution Plans,and No. 50,Pension Disclosures,as they relate to pension plans that are <br /> administered through trusts or equivalent arrangements(hereafter jointly referred to as trusts)that meet certain criteria. <br /> The requirements of Statements No. 25 and No. 50 remain applicable to pension plans that are not administered through trusts <br /> covered by the scope of this Statement and to defined contribution plans that provide postemployment benefits other than <br /> pensions. <br /> This Statement is effective for financial statements for fiscal years beginning after June 15,2013.Earlier application is <br /> encouraged. <br /> How the Changes in This Statement Will Improve Financial Reporting <br /> The requirements of this Statement will improve financial reporting primarily through enhanced note disclosures and schedules of <br /> required supplementary information that will be presented by the pension plans that are within its scope. The new information <br /> will enhance the decision-usefulness of the financial reports of these pension plans,their value for assessing accountability,and <br /> their transparency by providing information about measures of net pension liabilities and explanations of how and why those <br /> liabilities changed from year to year.The net pension liability information, including ratios,will offer an up-to-date indication of <br /> the extent to which the total pension liability is covered by the fiduciary net position of the pension plan.The comparability of the <br /> reported information for similar types of pension plans will be improved by the changes related to the attribution method used to <br /> determine the total pension liability.The contribution schedule will provide measures to evaluate decisions related to the <br /> assessment of contribution rates in comparison to actuarially determined rates,when such rates are determined. In that <br /> circumstance,it also will provide information about whether employers and nonemployer contributing entities, if applicable, are <br /> keeping pace with actuarially determined contribution measures. In addition,new information about rates of return on pension <br /> plan investments will inform financial report users about the effects of market conditions on the pension plan's assets over time <br /> and provide information for users to assess the relative success of the pension plan's investment strategy and the relative <br /> contribution that investment earnings provide to the pension plan's ability to pay benefits to plan members when they come due. <br /> 952.835.9090 • Fax 952.835.3261 <br /> www.aemcpas.com <br />