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Future Accounting Standard Changes (Continued) <br />With respect to financial statements prepared using the current financial resources measurement focus, this Statement <br />requires that expenditures be recognized for the amount that normally would be liquidated with expendable available <br />financial resources. <br />Effective Date and Transition <br />The requirements of this Statement are effective for fiscal years beginning after December 15, 2023, and all reporting <br />periods thereafter. Earlier application is encouraged. <br />How the Changes in This Statement Will Improve Accounting and Financial Reporting <br />The unified recognition and measurement model in this Statement will result in a liability for compensated absences that <br />more appropriately reflects when a government incurs an obligation. In addition, the model can be applied consistently to <br />any type of compensated absence and will eliminate potential comparability issues between governments that offer <br />different types of leave. <br />The model also will result in a more robust estimate of the amount of compensated absences that a government will pay <br />or settle, which will enhance the relevance and reliability of information about the liability for compensated absences <br />(1) Note. From GASB Pronouncements Summaries. Copyright 2022 by the Financial Accounting Foundation, 401 Merritt 7, <br />Norwalk, CT 06856, USA, and is reproduced with permission. <br />Restriction on Use <br />This communication is intended solely for the information and use of the Public Utilities Commission, City Council, <br />management, and the Minnesota Office of the State Auditor and is not intended to be and should not be used by anyone <br />other than these specified parties. <br />The comments and recommendations in this report are purely constructive in nature, and should be read in this context. <br />Our audit would not necessarily disclose all weaknesses in the system because it was based on selected tests of <br />accounting records and related data. <br />If you have any questions or wish to discuss any of the items contained in this letter, please feel free to contact us at your <br />convenience. We wish to thank you for the opportunity to be of service and for the courtesy and cooperation extended to <br />us by your staff. <br />Abdo <br />Minneapolis, Minnesota <br />April 4, 2023 <br />m <br />