Which statement best differentiates GASB 68 and GASB 75?

Which statement best differentiates GASB 68 and GASB 75?

• A. GASB 68 addresses net pension liability for state/local pensions on government-wide statements; GASB 75 addresses net OPEB liability.
• B. GASB 68 addresses debt issuance costs; GASB 75 addresses pension liability.
• C. GASB 68 addresses net OPEB liability; GASB 75 addresses net pension liability.
• D. GASB 68 is about revenue recognition; GASB 75 is about expense recognition.

Answer: (A)

At the heart of this question is the distinction between pensions and other postemployment benefits (OPEB). GASB 68 requires governments to recognize the net pension liability for state and local pension plans on government-wide financial statements. In other words, it measures the total pension obligation minus the plan’s fiduciary net position and presents that net amount as a liability. GASB 75 does the same kind of reporting, but for OPEB—benefits other than pensions provided after retirement, such as retiree health care—again on government-wide statements. The key difference is the type of benefit being reported: pensions versus other postemployment benefits. The other options mix up what each standard addresses or refer to topics (like debt issuance costs or revenue/expense recognition) that these standards do not govern.

At the heart of this question is the distinction between pensions and other postemployment benefits (OPEB). GASB 68 requires governments to recognize the net pension liability for state and local pension plans on government-wide financial statements. In other words, it measures the total pension obligation minus the plan’s fiduciary net position and presents that net amount as a liability. GASB 75 does the same kind of reporting, but for OPEB—benefits other than pensions provided after retirement, such as retiree health care—again on government-wide statements. The key difference is the type of benefit being reported: pensions versus other postemployment benefits. The other options mix up what each standard addresses or refer to topics (like debt issuance costs or revenue/expense recognition) that these standards do not govern.