FASAB requests comments re U.S. insurance programs

The Federal Accounting Standards Advisory Board (FASAB) recently proposed accounting standards for U.S. government-related insurance programs and is seeking public comment through March 29, 2016. Programs under consideration include insurance and non-loan guarantee programs authorized by law to compensate a designated population of beneficiaries by accepting all or part of the financial risk for losses incurred as a result of an adverse event.

The proposed standards seeks to:

• Define terms aimed at identifying and classifying insurance programs and related financial activities for financial reporting purposes;
• Provide guidance on how and when insurance programs should recognize revenue, expenses, and liabilities;
• Provide guidance for estimating losses for remaining coverage when contracts provide coverage after the reporting date; and
• Update disclosure guidance to encourage concise, meaningful, and transparent information.

The proposed standards and procedures for providing input can be found at: https://t.co/pSkVraYgKZ.

FASAB is responsible for promulgating accounting standards for the U.S. government. Those standards are recognized as generally accepted accounting principles (GAAP) for the federal government. It should be noted, however, that some federal entities such as the U.S. Postal Service follow GAAP for nongovernmental entities promulgated by the private sector Financial Accounting Standards Board (FASB).