|To:||Legislative Leadership, Judicial Branch Administrators, Elected Officials, Secretariats, Department Heads, and Chief Fiscal Officers|
|From:||Martin J. Benison, Comptroller|
|Date:||April 15, 2009|
|Re:||GASB Statement No. 49 Implementation - Accounting and Financial Reporting for Pollution Remediation Obligations|
Comptroller Memo Y#2009-28
The Office of the State Comptroller is distributing a questionnaire for state agencies and institutions of higher education relating to the implementation of the Governmental Accounting Standards Board Statement No. 49 (GASB 49).
Beginning in fiscal 2009 (as of July 1, 2008), the Commonwealth is required to implement the requirements of GASB 49. To prepare for this implementation, the Financial Reporting and Analysis Bureau is surveying agencies and institutions of higher education to identify pollution remediation obligations that will be included in their annual financial reports and the 2009 Comprehensive Annual Financial Report (CAFR).
Please make sure the information in this memo is conveyed to relevant staff in your department.
All agencies and institutions must complete the electronic questionnaire online by Thursday, April 30, 2009. The questionnaire must be submitted electronically.
Your submission of the questionnaire is an acknowledgment that you have reviewed your agency's operations for potential pollution remediation obligations.
Summary of the Requirements of the Statement
The scope of the document excludes pollution prevention or control obligations with respect to current operations, and future pollution remediation activities that are required upon retirement of an asset, such as landfill closure and post-closure care and nuclear power plant decommissioning.
For the Commonwealth, the requirements of GASB 49 are effective for financial statements of fiscal year 2009. Pollution remediation liabilities should be measured as of July 1, 2008 so that beginning net assets of the CAFR can be restated.
Recognition and Measurement of Pollution Remediation Liabilities
The Commonwealth will calculate the components of the liability (for example, legal services, site investigation, or required post-remediation monitoring) as they should be recognized as they become reasonably estimable. The estimate of a pollution remediation liability will be evaluated as each of the following benchmarks occurs:
The Office of the State Comptroller will contact you for the above information should your agency answer the attached questionnaire with a "yes" answer. We will measure the Commonwealth's liability based on the current value of cash flow outlays expected to be incurred for the life of the project.
If the underlying parcel that is subject to these provisions is expected to be sold upon remediation, please also indicate as such.
Contacts and References