Governmental Accounting Standards Board (GASB) Statement 34, also known as GASB34, is a lengthy regulation related to financial reporting for state and local governments.
GASB34 requires that state and local governments file comprehensive annual financial reports. The annual report must include a detailed accounting related to the agencies capital assets.
Capital assets, according to GASB, include; land, improvements to land, easements, buildings, building improvements, vehicles, machinery, equipment, works of art, and historical treasures.
Our focus, as it relates to state and local governments and GASB will remain strictly on capital assets, though the statement (which is over 400 pages) addresses many other aspects of financial reporting requirements for these agencies.
In order to provide the required reporting, each agency must perform a physical inventory of capital assets, and reconcile the results to their existing fixed asset register records on an annual basis.
Many state and local governments do in fact conduct an annual physical inventory of capital assets. Most however, do not have the internal resources to complete their capital asset inventory, and are outsourcing these services to companies that specialize in fixed asset management (such as Verasset).
The service provider should be able to quickly, and accurately complete the inventory, providing the agency with up-to-date information. The service provider should also report on any variances discovered, allowing the agency to update their records accordingly.
This allows the agency to accurately report on their capital assets in the annual financial report as mandated by GASB34.
Often, these agencies recognize the benefits of having up-to-date records of their assets beyond regulatory compliance, and are electing to inventory non-capitalized items as well. Some additional benefits in conducting an annual inventory of fixed assets are; reduced loss and theft, improved utilization, and ensuring adequate insurance coverage.
Verasset provides capital asset inventory and reconciliation services to various state and local governments. Some examples include:
- State University Systems
- Community College Systems
- State, City, Town and County Government Offices
- Public Works
- State and City Mandated Programs