Heritage Assets and Stewardship Land
For questions about this project, email fasab@fasab.gov.
Project Objective:
SFFAS 8 requires reporting of stewardship PP&E, which includes heritage assets and stewardship land (HA & SL). As described in SFFAS 8, required supplementary stewardship information (RSSI) is a category created by FASAB and its audit status was not designated. RSSI was intended to provide information that the Board believed was necessary for the ‘fair presentation’ of financial statements. In practice, preparers and users have not understood that RSSI is integral to fair presentation and people often assume that the information reported in RSSI is supplementary or of a secondary nature. This is contrary to the Board’s intention. Consequently, the Board is reviewing and re-categorizing the stewardship elements in the Federal financial model. (If this effort leads to reclassification of all items in the RSSI category, the Board will ultimately eliminate the category.) The Board solicited comments on its efforts to eliminate the RSSI category through a Preliminary Views document in December 2000 (the preliminary views document can be found at /pdffiles/rssi.pdf ). This particular project addresses appropriate categorization of two of the stewardship elements: heritage assets and stewardship land.
HISTORY OF BOARD DELIBERATIONS (reverse chronology)
June 22-23, 2005
Statement of Federal Financial Accounting Standards (SFFAS) 29, Heritage Assets and Stewardship Land was issued on July 7, 2005 . This standard reclassifies heritage assets and stewardship land information as basic information, except for condition information, which is classified as required supplementary information. “This reclassification improves the clarity of federal financial reporting by defining heritage assets and stewardship land information as essential to fair presentation,” according to Mr. Mosso. The standard also requires additional reporting disclosures about entity stewardship policies and an explanation of how heritage assets and stewardship land relate to the entity’s mission. The standard also includes the requirements for the U.S. Government-wide Financial Statement.
The standard is effective for reporting periods beginning after September 30, 2005 with the exception of certain reporting requirements that are to be phased-in. The standard provides for a phase-in of disclosure requirements being reported as basic information such that the standards will be fully implemented for reporting periods beginning after September 30, 2008 .
The statement is available on the FASAB Web site at /accounting-standards/ . The FASAB has discontinued printing hard copies.
March 2-3, 2005 Meeting:
After the March 2005 Board meeting, the Board unanimously approved the ballot Heritage Assets and Stewardship Land draft statement of federal financial accounting standards. Although the Board vote is final, there is a 90 day clearance for OMB and GAO to offer an objection. Additionally, since this standard relates to capital assets, the CFO Act requires a 45 day Congressional review period. Therefore, FASAB does not anticipate release of the final standard before summer.
Key revisions (since being exposed for comment) include a phased-in implementation for reclassification of information as basic and additional language regarding categorization. In addition, the Basis for Conclusions includes detail regarding guidance to be developed by the AAPC. Specifically, the draft statement of federal financial accounting standard includes the following phased-in implementation and additional language regarding categorization:
These standards are effective for reporting periods beginning after September 30, 2005 with the exception of the following (these exceptions provide for a phase-in of disclosure requirements being reported as basic information such that these standards will be fully implemented for reporting periods beginning after September 30, 2008):
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- The disclosure for “The concise description of each major category of heritage asset [major category of stewardship land use]. The appropriate level of categorization of heritage assets [stewardship land use] should be meaningful and determined by the preparer based on the entity’s mission, types of heritage assets [stewardship land], and how it manages the assets.”
is effective for reporting periods beginning after September 30, 2007
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- The disclosure for “Heritage assets [stewardship land] should be quantified in terms of physical units. The appropriate level of aggregation and physical units { footnote: Defining physical units as individual items to be counted is neither required nor prohibited. Particularly for collection-type heritage assets, it may be more appropriate to define the physical unit as a collection, or a group of assets located at one facility, and then count the number of collections or facilities .} of measure for each major category should be meaningful and determined by the preparer based on the entity’s mission, types of heritage assets [stewardship land], and how it manages the assets. For each major category of heritage asset [major category of stewardship land use] the following should be reported: 1.) The number of physical units by major category; major categories should be classified by collection or non-collection type heritage assets for which the entity is the steward as of the end of the reporting period;” is effective for reporting periods beginning after September 30, 2007;
- The disclosure “The number of physical units by major category [for heritage assets and stewardship land] that were acquired and the number of physical units by major category that were withdrawn during the reporting period;” is effective for reporting periods beginning after September 30, 2008;
- The disclosure “A description of the major methods of acquisition and withdrawal of heritage assets [stewardship land] during the reporting period. This should include disclosure of the number of physical units (by major category) of transfers of heritage assets [stewardship land] between Federal entities and the number of physical units (by major category) of heritage assets [stewardship land] acquired through donation or devise, if material. In addition, the fair value of heritage assets [stewardship land] acquired through donation or devise during the reporting period should be disclosed, if known and material.” is effective for reporting periods beginning after September 30, 2008.
- Information that is provided an exception (as described above) to being reported as basic information during the phase-in period is still required, but should be reported as RSI until the exceptions expire.
- Earlier implementation of the standards is encouraged.
December 15-16, 2004 Meeting:
The Board discussed staff proposed revisions to the proposed standard. Staff will move forward on finalizing the standard and provide the Board with a pre-ballot version prior to the next Board meeting.
October 20-21, 2004 Meeting:
Staff presented an Issues Paper that detailed key areas for discussion as the Board proceeds on the project–Accountability and Stewardship Considerations, Categorization and Unitization, Materiality, Audit Costs, and Possible Phased Implementation Methods.
After discussing each of the issue areas, the Board decided to move forward with finalizing the proposed standard for issuance. Staff will revise the proposed standard based on the recommendations approved by the Board and for other changes discussed at the meeting. Key revisions will include a phased-in implementation based on required reporting disclosures, additional language regarding categorization and unitization, additional language regarding supporting documentation and language regarding guidance to be developed by the AAPC.
Deliberations prior to August 2004
The ED Heritage Assets and Stewardship Land: Reclassification from Required Supplementary Stewardship Information was issued on August 20, 2003 with comments requested by November 10, 2003. See FASAB Web site fasab-gov.go-vip.net/exposure.htm for a copy of the ED. The ED provides for a line item to be shown on the balance sheet for significant heritage assets and stewardship land, but no financial amount should be shown. Instead, the line item would reference a note disclosure that would provide minimum reporting requirements. The ED introduces minor changes to the current disclosure requirements for heritage assets and stewardship land by requiring additional reporting disclosures about entity stewardship policies and an explanation of how heritage assets and stewardship land are pertinent to the entity’s mission. The ED includes disclosure requirements for the U.S. Government-wide Financial Statement that would provide for a general discussion and direct users to the applicable entities’ financial statements for more detailed information on heritage assets and stewardship land. The ED also incorporates the revised multi-use heritage asset standards of SFFAS 16 and the deferred maintenance reporting requirements related to heritage assets and stewardship land from SFFAS 14. Accordingly, the ED proposes rescissions to those standards. As a result, the ED will provide all current standards for heritage assets and stewardship land.
The Board discussed the comments received on the ED at the December 10-11, 2003 FASAB meeting. Based on the comment letters received, staff determined the following summary of responses:
- A majority of the respondents do not agree with the Board’s proposal for heritage assets and stewardship land to be reported as basic information.
- Most respondents agree with the Board’s new disclosure requirements and do not foresee any problems with the new disclosure requirements about entity stewardship policies and an explanation of how heritage assets and stewardship land are pertinent to the entity’s mission.
- Most respondents do not agree with the proposed effective date for periods beginning after September 30, 2004.
- Most respondents agree that the preparer should be allowed to exercise professional judgment in determining if the heritage assets and stewardship land are significant.
The Board held a public hearing on the ED and comments in conjunction with the March 2004 Board meeting. Individuals from the Library of Congress, U.S. Department of Agriculture, Department of Interior (including representatives from the CFO, OIG and IPA currently performing the DOI audit), and a representative from the Institute for Truth in Accounting provided testimony to the Board. Details regarding the testimony of the public hearing are available in the March 2004 minutes.