1. 2017 APA Local Government Update
_____________________________________
May 19, 2017
Rachel Reamy, Local Government Audit Manager
Auditor of Public Accounts

2. Preparing for Upcoming OPEB Implementation
GASB Statement 74, Financial Reporting for Postemployment Benefit Plans Other Than Pension Plans
Applicable to VRS and other independent OPEB’s financial statements
Effective FY2017
GASB Statement 75, Accounting and Financial Reporting for Postemployment Benefits Other Than Pensions
Applicable to Local Government’s financial statements
Effective FY2018

3. Preparing for Upcoming OPEB Implementation
OPEB standards closely mirror GASB 67/68 pension accounting
Funding and accounting are separated
Liability discount rate will be based on a projection of how long dedicated assets (plus future contributions) will cover current plan members’ future benefit payments
Unfunded OPEB liability will now be reported on face of the financial statements
Expanded note disclosures and RSI

4. Preparing for Upcoming OPEB Implementation
Local Governments may participate in following Commonwealth sponsored OPEBs
Other Postemployment Retiree Health Insurance Credit (RHIC)
4 Single Employer Plans-Social Service Employees, Registrars, Constitutional Officers, and State
1 Cost sharing Plan- Teachers
Approximately 90 Multi-Agent Plans- Political Subdivisions
Other Employment Group Life (GLI)
Cost Sharing plan includes Teachers, Localities and State

5. Preparing for Upcoming OPEB Implementation
Local Governments may participate in following Commonwealth sponsored OPEBs
Other Postemployment Line of Duty Death and Disability (LODA)
Cost Sharing plan for “Participating Employers,” includes Local Governments and State
Virginia Local Disability Program (VLDP)
Cost Sharing plan includes Teachers and Political Subdivisions, treated separately for allocation purposes
Participating employers are those that participate in the VRS administered trust. Localities may still provide benefits in compliance with the Line of Duty Act, but do not fund the benefits through the VRS-administered trust fund (i.e.: referred to as “non-participating” employers). If this is the case, the local auditor should determine how the locality will develop its liability for the Line of Duty Act and perform any audit procedures that may be necessary in preparation of GASB 75.
A listing of the LODA participating employers is available at the Virginia Line of Duty Act website,
A listing of the LODA non-participating employers is available here-

6. Preparing for Upcoming OPEB Implementation
Audit process and financial reporting information for Commonwealth sponsored OPEBs
Potential in future for VRS to contract for service organization controls (SOC-1 Type 2) report instead of opining at the employer level
APA audit assurance provided similar to audit work for GASB 68
APA to issue multiple opinions for OPEB plans
VRS to publish OPEB schedules and templates for journal entries, disclosures/RSI
VRS Actuarial Valuations – VRS actuarial valuations for pensions occur every year for both funding and accounting. OPEB funding valuations are performed each year and it is expected the accounting valuations will occur annually. The assumptions for financial reporting purposes concepts will be similar as under the Statements Nos. 67 and 68.
VNAV Data –it is possible to stratify the VNav data in order to define populations based on which plans/OPEBs members participate.

7. Preparing for Upcoming OPEB Implementation
APA opinions for Commonwealth sponsored OPEB plans
Opinions over allocation of Net OPEB Liability
Cost sharing plans under LODA, GLI and RHIC
Certain single employer plans with multiple employer participants for RHIC
Separate opinions for allocation of the statement of changes in fiduciary net position for each of the RHIC agent plans

8. Preparing for Upcoming OPEB Implementation
Non-Commonwealth sponsored OPEB plans
Local Governments participate in other OPEB plans
I.E.: VACo/VML Pooled OPEB Trust
APA will not be involved in providing audit assurance or financial reporting information for non-Commonwealth OPEBs
Have discussions now with OPEB’s Plan Administer and the Plan’s auditors
Audit assurance/opinions that will be provided?
Timing and how financial reporting information will be provided for local government financial statements?
One of the most important considerations about upcoming OPEB is that Local Governments should be considering the impact of any non-Commonwealth (not administered by VRS) OPEB plans on their financial statements, since the APA will not be involved in the process.

9. APA website, Local Government page
APA Local Government Contact Information
Rachel Reamy, Local Government Audit Manager, Auditor of Public Accounts
, ext. 360
APA website, Local Government page
Government.aspx