Expedite Your ARO Adoption.
Leverage Our Expertise.
Need support adopting the new Asset Retirement Obligation (ARO) accounting standard PS-3280? PSD Citywide’s Financial Management Advisory team has the expertise to rapidly support you through this challenging process.
Let Us Do the Heavy Lifting.
With the technical knowledge to understand and interpret the new PSAB standard, our Advisors can walk you through the adoption process while supporting the features already accessible in Citywide Assets. Developed to be your one stop shop for ARO recognition, including document storage, calculations, and reporting, our team has the in-depth expertise and experience working with Citywide Assets to make adoption of the standard faster and easier. They can support you through the process: from identification and data collection, through measurement, reporting, and disclosure. Basically, they are here to do the heavy lifting for you.
Our Three Step Process.
Our three step process is designed to help make ARO compliance less taxing on you and your team. With in-depth knowledge of Citywide Assets, along with a guided consultative approach, our team can help deliver the following services to support your adoption of accounting standard PS-3280:
Plan Development
Our process begins with the development of a solid plan to get you through the transition effectively. First, our advisors will host workshops to aid in identifying potential ARO liabilities within your local government. They will then use these to prepare a plan to identify your transitional approach; identify adoption risk and mitigation techniques, and document discount and inflation rates used to calculate the AROs.
ARO Data Entry
Our advisors will manage the ARO processing and data entry into your Tangible Capital Assets (TCA) inventory within Citywide Assets. This includes the identification and review of existing assets, as well as GL code entry for the liability, accretion expense, and amortization expense accounts. They will also perform ARO classification and cost estimates while also considering inflation, likelihood, and discount rates.
Support & Disclosure
Finally, our advisors will leverage Citywide Assets to prepare and review the adjusting journal entries. This includes providing review and guidance of the newly created GL accounts. Advisors will draft the required financial statement note disclosures. This includes changes required for the significant account policies note, a change in accounting policy note, and the asset retirement obligation note.
Our advisors will also draft amendments to your existing TCA policy or draft a new ARO policy which incorporates the decisions made by your government through adoption.
FAQ's
Yes, PSD Citywide can support 2023 year-end ARO compliance, depending on what stage your government is at with their ARO implementation.
A multidisciplinary team of internal professionals is required to identify and measure potential AROs in an effort to mitigate the completeness risk associated with adoption. PSD Citywide, in collaboration with the internal finance department, supports the completion of scoping, drafts the project plan, performs the detailed data work, creates the adjusting entries and prepares financial statement note disclosures. Your third-party CPA licensed audit team ensures compliance through the year-end audit process.
There are a number of acceptable approaches for valuing AROs, including shared costing models, internal development estimates using professional judgment, and third party valuation. PSD Citywide can advise you on how to navigate the options for your consideration.
Let Us Help You Through This.
The Financial Advisory practice at PSD Citywide is here to assist your community in navigating the new Asset Retirement Obligation (ARO) accounting standard. If you are a client of Citywide Assets, feel free to complete the form below and we will ensure your dedicated Account Manager reaches out to discuss how we help you through this change.
