FROM THE EDITOR

Finance systems will adapt to reporting requirements

Thomas R. Temin

What's the first thing that comes to mind when you hear 'Wooster, Ohio'?

For me, it's obvious'lots of nifty little containers to organize the refrigerator. Wooster is home to the corporate headquarters of Rubbermaid Inc., the manufacturer of countless household items such as laundry baskets and leftover holders. The more historically minded reader might recall that the city is named for a Revolutionary War general, James Wooster.

Well, Wooster is distinguishing itself in another way and, in doing so, is proving that big cities aren't the only repositories of information technology wisdom.

Because the city of 25,000 has nearly 20 years of experience in accrual accounting and capitalizing its fixed assets, it will be able to generate Statement 34-compliant financial reports by December, the end of its current fiscal year. To meet the new reporting requirements, Wooster will need to make only small changes in its accounting and finance systems.

Statement 34-compliant? OK, it doesn't sound sexy. But if you don't know about Statement 34, you'd better start boning up on it. Start by reading our Page 1 story about the recent major change in public accounting methods drafted by the Governmental Accounting Standards Board. Statement 34 is not just for the bean counters because it will have a big impact on financial IT for virtually every state and local government organization.

As GCN/State & Local's Claire House reports, Statement 34 will compel a landmark change in how government agencies track and report various assets. Charts of accounts will grow more detailed, and you must record fixed pieces of your infrastructure as capital assets, estimating and reporting their value annually. In short, government agencies must account for things just as businesses do.

In most places, especially those lacking a method for tracking fixed capital assets, agencies' current systems will not meet the Statement 34 reporting requirements. The tools to convert existing software to handle the new requirements are available, so expect to be working closely with your accounting folks to update your systems.

There's a bonus for IT people in this. The better agencies can track and budget for capital assets in a way that makes sense, the easier it is to plan for and justify capital expenditures'even purchases for new systems themselves. Now you'll have a tool that, used smartly, can help you build systems for the future and make sure the program funds are there to do it.

Thomas R. Temin

Editorial director

Internet: editor@gcn.com

inside gcn

  • Shutterstock ID: 415195669 By Flexey

    Early IPP test flights take off

Reader Comments

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above

More from 1105 Public Sector Media Group