Few public sector employers understand GASB reporting changes
Most public sector employers do not fully understand the financial implications of the new Government Accounting Standards Board (GASB) requirements for reporting other post-employment benefits (OPEB), according to a study by Chicago-based Aon Corp. That ignorance could cost local governments substantial amounts of money.
The Aon survey of 118 public sector employers who offer non-pension retiree medical benefits and focused on learning how respondents were preparing to comply with the new GASB standards. Aon recommends a three-step process — conducting a baseline actuarial valuation to determine costs of OPEBs, determining funding options and making retirement plan design changes. While 85 percent of survey respondents had completed baseline actuarial valuations or were in the process of completing them, 103 of the 118 participants in the survey chose not to answer the question on whether they were exploring funding options. “[That implies] they are unclear on how they will finance their OPEB obligations,” said Phil Peterson, the survey’s director.
More information is available at www.aon.com/