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CITY OF SAN LEANDRO <br />MEMORANDUM ON INTERNAL CONTROL <br />SCHEDULE OF OTHER MATTERS <br />Effective in fiscal year 2020-21: <br />GASB 87 – Leases <br />This Statement will increase the usefulness of governments’ financial statements by requiring reporting of <br />certain lease liabilities that currently are not reported. It will enhance comparability of financial <br />statements among governments by requiring lessees and lessors to report leases under a single model. <br />This Statement also will enhance the decision-usefulness of the information provided to financial <br />statement users by requiring notes to financial statements related to the timing, significance, and purpose <br />of a government’s leasing arrangements. <br />GASB 89 – Accounting for Interest Cost Incurred before the End of a Construction Period <br />This Statement establishes accounting requirements for interest cost incurred before the end of a <br />construction period. Such interest cost includes all interest that previously was accounted for in <br />accordance with the requirements of paragraphs 5–22 of Statement No. 62, Codification of Accounting <br />and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA <br />Pronouncements, which are superseded by this Statement. This Statement requires that interest cost <br />incurred before the end of a construction period be recognized as an expense in the period in which the <br />cost is incurred for financial statements prepared using the economic resources measurement focus. As a <br />result, interest cost incurred before the end of a construction period will not be included in the historical <br />cost of a capital asset reported in a business-type activity or enterprise fund. This Statement also <br />reiterates that in financial statements prepared using the current financial resources measurement focus, <br />interest cost incurred before the end of a construction period should be recognized as an expenditure on a <br />basis consistent with governmental fund accounting principles. <br />6494