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  • SB 12-140: Generally Accepted Accounting Principles For The State

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    Senator Mike Johnston
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    The bill would cause the General Assembly to declare that traditional forms of state-government accounting should be replaced by GAAP principles. The bill directs the controller to implement a budgeting, accounting, and reporting system based on GAAP principles applicable to state governments by January 1, 2014. In 2008, 17 states had budgets that reflected GAAP accounting.

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    SB 12-140: Generally Accepted Accounting Principles for the State

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    The bill would cause the General Assembly to declare that traditional forms of state-government accounting should be replaced by GAAP principles. The bill directs the controller to implement a budgeting, accounting, and reporting system based on GAAP principles applicable to state governments by January 1, 2014. In 2008, 17 states had budgets that reflected GAAP accounting.

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    25 views2 pages

    SB 12-140: Generally Accepted Accounting Principles For The State

    Uploaded by

    Senator Mike Johnston
    The bill would cause the General Assembly to declare that traditional forms of state-government accounting should be replaced by GAAP principles. The bill directs the controller to implement a budgeting, accounting, and reporting system based on GAAP principles applicable to state governments by January 1, 2014. In 2008, 17 states had budgets that reflected GAAP accounting.

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    Office of Sen.

    Mike Johnston
    Colorado General Assembly | 200 E. Colfax Avenue | Denver, CO 80203 | 303.866.4864

    FACT SHEET MEMORANDUM


    SB 12-140 Generally Accepted Accounting Principles for the State Sen. Grantham Staff Name: Dietrich Hoefner What the Bill Does: The Colorado Controllers office does most of its financial accounting according to the Governmental Accounting Standards Board1 (GASB2) rules for Generally Accepted Accounting Principles3 (GAAP). However, some parts of the budget are not done according to GAAP accounting. Specifically, Colorado Law requires that certain payroll, medical care, and information technology expenditures be deferred into the following year, which violates GAAP principles. This bill would cause the General Assembly to declare that traditional forms of state-government accounting should be replaced by GAAP principles used in the private sector. The bill directs the controller to implement a budgeting, accounting, and reporting system based on GAAP principles applicable to state governments by January 1, 2014. The controller is also directed to publish a procedures manual describing the new accounting procedures. Colorado Context: In the comprehensive analysis for fiscal year 2010-11, $254.3 million in expenditures were deferred into fiscal year 2011-12. After accounting for $101.3 million in related federal revenue, the deferred expenditures for 2010-11 netted to $153.1 million. Compliance with GAAP accounting in this area would require a similar amount to be appropriated at implementation. National Context: In 2008, 17 states had budgets that reflected GAAP accounting.4

    Office of the State Controller, Comprehensive Annual Fiscal Report (June, 2011), http://www.colorado.gov/dpa/dfp/sco/CAFR/cafr11/cafr11.pdf 2 In contrast, GAAP rules for private businesses are created by the Financial Accounting Standards Board (FASB). Both GASB and FASB are under the oversight of the Financial Accounting Foundation (FAF), an independent standards-setting corporation. 3 Colo. Rev. Stat. Ann. 24-77-101(2)(c), (e), (f) 4 National Association of State Budget Officers, Budget Processes in the States (2008), http://nasbo.org/LinkClick.aspx?fileticket=AaAKTnjgucg=&tabid=80

    DRAFT 2/13/2012 9:51 AM

    For a complete list of fact sheets, visit www.mikejohnston.org/in-the-legislature.

    Bill Provisions: Requires that the controller establish a comprehensive budgeting, accounting, and reporting system according to GAAP standards applicable to state governments, and to publish an accounting standards manual detailing the new system Fiscal Impact: There is not a fiscal note associated with this bill at this time.

    DRAFT 2/13/2012 9:51 AM

    For a complete list of fact sheets, visit www.mikejohnston.org/in-the-legislature.

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