For Immediate Release: January 31, 2018
Contacts: Employer/auditor inquiries: Heather Fritzky, Director of Finance, (603) 410-3540; [email protected]
Media inquiries: Marty Karlon, Public Information Officer, (603) 410-3594; [email protected]
CONCORD, NH – The New Hampshire Retirement System (NHRS, the retirement system) has released two reports for Fiscal Year 2017 related to Governmental Accounting Standards Board (GASB) Statement No. 68, which impacts financial reporting for participating employers.
The reports are:
- GASB Statement No. 68 Employer Reporting Accounting Schedules (June 30, 2017) (“GRS Report”) – Prepared by Gabriel Roeder Smith & Company (GRS), the retirement system’s independent actuary.
- Schedule of Employer Allocations and Schedule of Pension Amounts by Employer (June 30, 2017) (“KPMG Report”) – Prepared by NHRS and audited by KPMG, the retirement system’s independent external auditor.
KPMG auditors have tested the information in the employer schedules in the GRS Report and issued an unmodified, clean opinion in their audit report. Employers should use the schedules in both reports; the KPMG Report to prepare the financial statements, footnote disclosures, and required supplementary information (RSI) and the GRS Report to obtain the sensitivity analysis and schedule of deferred inflows and outflows by year. Both reports are available at: https://www.nhrs.org/employers/gasb/gasb-67-68-reports
In conjunction with the release of the reports, NHRS has also updated a document explaining how to read the reports, which is available at the above link.
These GASB 68 reports are for employers with fiscal years ending anytime between July 1, 2017, and June 30, 2018.
Although GASB 68 only impacts financial accounting, NHRS recognizes that the release of reports that include proportionate shares of the retirement system’s net pension liability and pension expense for each employer has the potential to spur questions or concerns. NHRS wants to emphasize that regardless of what the proportionate share and pension expense is, those numbers are for accounting and financial reporting purposes only and do not impact future NHRS employer contribution rates or local property tax rates. The retirement system has a statutory funding schedule to pay down its Unfunded Actuarial Accrued Liability (UAAL) through 2039, which is not affected by GASB 68.
Reminder: New accounting rules for OPEB benefits take effect this year
In 2018, GASB is implementing updated financial reporting changes for post-employment benefits other than pensions (OPEB) that affect NHRS participating employers. OPEB refers to the benefits, other than pensions, that a state or local government employee receives as part of his or her package of retirement benefits. Typically retiree medical insurance is the most significant OPEB offering, though other benefits such as life insurance are also covered by this umbrella term. For GASB purposes, the NHRS Medical Subsidy is an OPEB benefit.
GASB Statement No. 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions, will take effect in 2018 for governmental employers with fiscal years ending June 30, 2018, or later.
NHRS expects to provide audited GASB 75 employer-level data in two phases; the late summer of 2018 for employers with fiscal years ending June 30, 2018, and updated data in early 2019 for employers with fiscal years ending Dec. 31, 2018. For more information, see: https://www.nhrs.org/about-nhrs/news/article/2017/12/29/new-financial-accounting-standard-takes-effect-for-nhrs-employers-in-2018
Note: While NHRS will provide employer-level GASB 75 liability and expense information regarding the Medical Subsidy, an employer may have additional OPEB liabilities that the retirement system is unaware of, such as employer-funded health care or life insurance for retirees. NHRS advises employers to discuss the impact of GASB 75 with their auditors.
NHRS provides retirement, disability, and death benefits to its eligible members and their beneficiaries. The State of New Hampshire and more than 470 local government employers participate in NHRS for their employees, teachers, firefighters, and police officers. NHRS has approximately 48,000 active members and 35,000 pension recipients. NHRS administers a defined benefit plan qualified as a tax-exempt entity under sections 401(a) and 501(a) of the Internal Revenue Code.
# # #