One Significant Difference Between How the GASB and the FASB

Multiple Choice

One significant difference between how the GASB and the FASB report retiree benefits, such as pensions, is that businesses report the difference between actuarial projections versus actual results immediately in comprehensive income. Actuarial differences calculated by governmental entities are deferred and amortized. What reason does the GASB give for this treatment?

A) Governments rarely go out of business, while a company could be sold at any time
B) Actuarial projections generally aren't reliable; this softens the effect of mismeasurement
C) Governments will be able to cover the cost of retiree benefits with property taxes, which will
Always be available
D) Governments do not like the "lumpiness" that immediate recognition causes in retiree benefit expenses