GASB's implementation of the new measurement focus and basis of accounting.

• Jurisdiction: United States
• Author: Esser, Jeffrey L.
• Date: 01 June 1992

The "measurement focus" and "basis of accounting" of governmental funds determine how those funds measure and report their revenues and expenditures. Accordingly, the measurement focus and basis of accounting, or MFBA, is important to state and local government financial statements.

Starting in 1984, the Governmental Accounting Standards Board (GASB) undertook a major project to reexamine the current MFBA for governmental funds. This effort eventually resulted in the release of GASB Statement No. 11,

Measurement Focus and Basis of Accounting--Governmental Fund Operating Statements.

In response to the GASB's efforts, the GFOA Executive Board and membership adopted a formal policy statement on MFBA in May 1988. One of the key points made in that policy statement was that the new MFBA for governmental funds should only be implemented in conjunction with the GASB's separate project on financial reporting. The GFOA was gratified when GASB Statement No. 11 committed the GASB to the joint implementation of the two projects.

Since the issuance of GASB Statement No. 11, various delays have made it appear increasingly less likely that the GASB could keep its commitment to the simultaneous implementation of the MFBA and the financial reporting project. Therefore...