Below is some selected text from Richard Skiba’s 1992 statement to the Government Accounting Standards Board (GASB) regarding proposed accounting standards at the time.
Richard provided some valuable warnings. His statement still resonates and retains its value today, as GASB deliberates over a proposed new concept statement and accounting standard at odds with his long-standing concerns.
Richard is a long-time friend of Truth in Accounting. Richard’s email address is firstname.lastname@example.org and his phone number is 847-651-2342.
“Good morning, ladies and gentlemen. My name is Richard Skiba. I am Financial Administrator for the DuPage Water Commission, a single purpose unit of government in Elmhurst, Illinois.
The accounting model for government has become seriously flawed. Present day use of the concept of displaying only fund liabilities to be paid out of "expendable available financial resources" is misleading the public about the true financial condition of the governments under which they live. Abuse of the item called "amounts to be provided by future sources" camouflages deficit spending. This is deemed to be fair presentation in accordance with Generally Accepted Accounting Principles.
After eight years, the time for changing the model for government accounting may well be over. It may be time to revolutionize government accounting principles before the people themselves revolt.
These unfunded liabilities have become so large that, in some cases, the amounts will have to be provided by people who were not of voting age or, perhaps, not even born at the time those liabilities were incurred by the governing body.
This is a more devious method of taxation without representation than was ever applied to the American colonists by King George III [I should have said the British]. Today's politicians are robbing future Americans by hiding behind government accounting principles. In certifying fairness in accordance with those principles, CPAs are made accomplices to this theft.
A song popular in America, ironically, in 1968, contained the following verse:
‘You took a colored ribbon from out of the sky and taught me how to use it as the years went by, to tie-up all my problems and make them look sweet and then to sell them to the people in the street.‘
It's a very strange world and I would hate to see that inscription used on the dedication page of some politician's memoirs to acknowledge the work of his CPA.
GASB should start now to revolutionize the government accounting model before others take up the cause … Like other addictions, deficit addiction cannot be treated unless there is an admission of a problem.”