By Sheila Weinberg and EilAeen Norcross, includes "Unfunded pension liabilities are now reported on the government balance sheets, producing a more accurate picture of government finances and increasing the visibility and the total amount of liabilities on the books. However, the new guidance allows for a subjective application of key measurement assumptions regarding pension liabilities and for the continuance of a form of asset smoothing. The net effect of these guidelines on asset and liability measurement is to dampen the full value of unfunded pension liabilities. These changes are, in effect, at cross-purposes with the effort to make financial reporting more transparent. ..."
Read the full article on: Mercatus Center, George Mason University