Perspectives: Proposed GASB Rules Show Why Only Market Valuation Fully Captures Public Pension Liabilities

Posted: 12 Apr 2011

Date Written: April, 11 2011

Abstract

The Governmental Accounting Standards Board has released preliminary views on how public sector pension plans should value benefit liabilities. Because the GASB’s proposals ignore government’s contingent liability to pay plan benefits should assets fall short, they omit the full value of plan liabilities and contradict the GASB’s own standard of "interperiod equity."

Keywords: Financial Statement Analysis: Analysis of Pensions, Stock Compensation, and Other Employee Benefits: Analysis of Pension Costs and Liability, Other Post-Employment Benefits, Pension Plans

Suggested Citation

Biggs, Andrew G., Perspectives: Proposed GASB Rules Show Why Only Market Valuation Fully Captures Public Pension Liabilities (April, 11 2011). Financial Analysts Journal, Vol. 67, No. 2, 2011, Available at SSRN: https://ssrn.com/abstract=1807240

Andrew G. Biggs (Contact Author)

American Enterprise Institute ( email )

1150 17th Street N.W.
Washington, DC 20036
United States
202-862-5841 (Phone)

HOME PAGE: http://www.aei.org

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