News Release 12-16-10a


GASB Issues Statement No. 60, Accounting and Financial Reporting for Service Concession Arrangements

Norwalk, CT, December 16, 2010—The Governmental Accounting Standards Board (GASB) today issued Statement No. 60, Accounting and Financial Reporting for Service Concession Arrangements. Statement 60 addresses how to account for and report service concession arrangements (SCAs), a type of public-private or public-public partnership that state and local governments are increasingly entering into.

Common examples of SCAs include long-term arrangements in which a government (the “transferor”) engages a company or another government (the “operator”) to operate a major capital asset—such as toll roads, hospitals, and student housing—in return for the right to collect fees from users of the capital asset. In these SCAs, the operator generally makes a large up-front payment to the transferor. Alternatively, the operator may build a new capital asset for the transferor and operate it on the transferor’s behalf.

The Statement provides guidance on whether the transferor or the operator should report the capital asset in its financial statements, when to recognize up-front payments from an operator as revenue, and how to record any obligations of the transferor to the operator. The Statement also provides guidance for governments that are operators in an SCA.

The Statement improves financial reporting by establishing recognition, measurement, and disclosure requirements for SCAs for both transferors and governmental operators. It requires governments to account for and report SCAs in the same manner, which improves the comparability of financial statements. In addition, it is designed to alleviate the confusion that can arise when determining what guidance should be applied in complex circumstances, which previously were not specifically addressed in GASB literature.

“Feedback received from constituents during our due process was instrumental to the Board in developing Statement 60, resulting in requirements we believe will improve the financial reporting of SCAs by state and local governments,” stated GASB Chairman Robert H. Attmore. “By providing specific financial reporting guidance for SCAs entered into by governments, application of the Statement will result in greater clarity and transparency around these emerging types of relationships.”

The requirements for Statement 60 are effective for financial statements for periods beginning after December 15, 2011. In general, its provisions are required to be applied retroactively for all periods presented. More information on Statement 60 is available at

About the Governmental Accounting Standards Board

The GASB is the independent, not-for-profit organization formed in 1984 that establishes and improves financial accounting and reporting standards for state and local governments. Its seven members are drawn from the Board’s diverse constituency, including preparers and auditors of government financial statements, users of those statements, and members of the academic community. More information about the GASB can be found at its website