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• ~ ~ Ells River Municipal Utilities <br />April 7, 2008 <br />w~ t. Page 12 <br />I ~,_ <br />If any of the above bullets are met, the pollution remediation liabilities should be measured at their current value using the <br />expected cash flow technique, which measures the liability as a sum ofprobability-weighted amounts in a range of possible <br />estimated amounts. Expected recoveries from other responsible parties and from insurers reduce the amount of remediation <br />expense. Statement No. 49 also specifies criteria for capitalization of some pollution remediation outlays. <br />GASB Statement No. 50 -Pension Disclosures <br />This statement was issued May 2007 and is effective for periods beginning after June 15, 2007, except for requirements <br />related to the use of the entry age actuarial cost method for the purpose of reporting a surrogate funded status and funding <br />progress of plans that use the aggregate actuarial cost method, which are effective for periods for which the financial <br />statements and RSI contain information resulting from actuarial valuations as of June 15, 2007 or later. <br />This statement more closely aligns the fmancial reporting requirements for pensions with those for OPEB and, in doing so, <br />enhances information disclosed in notes to fmancial statements or presented as required supplementary information (RSI) by <br />pension plans and by employers that provide pension benefits. The reporting changes required by this statement amend <br />applicable note disclosure and RSI requirements of Statement No. 25 ,Financial Reporting for Defined Benefit Pension Plans <br />and Note Disclosures for Defined Contribution Plans, and No. 27 ,Accounting for Pensions by State and Local Governmental <br />Employers, to conform with requirements of Statement No. 43 ,Financial Reporting for Postemployment Benefit Plans Other <br />Than Pension Plans, and 45 ,Accounting and Financial Reporting by Employers for Postemployment Benefits Other Than <br />Pensions. This statement requires defined benefit pension plans and sole and agent employers present the following <br />information related to note disclosures: <br />• Notes to fmancial statements should disclose the funded status of the plan as of the most recent actuarial valuation <br />date. Defined benefit pension plans also should disclose actuarial methods and significant assumptions used in the <br />most recent actuarial valuation in notes to financial statements instead of in notes to RSI. <br />• If the aggregate actuarial cost method is used to determine the annual required contribution of the employer (ARC), <br />notes to fmancial statements should disclose the funded status of the plan, and a schedule of funding progress should <br />be presented as RSI, using the entry age actuarial cost method. Plans and employers also should disclose that the <br />purpose of doing so is to provide information that serves as a surrogate for the funded status and funding progress of <br />the plan. <br />• Notes to financial statements should include a reference linking the funded status disclosure in the notes to financial <br />statements to the required schedule of funding progress in RSI. <br />• If applicable, notes to fmancial statements should disclose legal or contractual maximum contribution rates. In <br />addition, if relevant, they should disclose that the maximum contribution rates have not been explicitly taken into <br />consideration in the projection of pension benefits for fmancial accounting measurement purposes. <br />• If an actuarial assumption is different for successive years, notes to fmancial statements should disclose the initial <br />and ultimate rates. <br />952.835.9090 Fax 952.835.3261 <br />www.aemcpas.com <br />