Chapter 8 Section 3: Deferred Outflows and Inflows of Resources

Question 1

Define deferred inflows and outflows of resources

Answer 1

Deferred outflow is a consumption of assets applicable to a future period. It has a positive effect on net position
Deferred inflow is an acquisition of assets applicable to a future period. It has a negative effect on net position

Question 2

How are derivatives reported?

Answer 2

Fair value

Question 3

How are changes in the value of derivatives handled?

Answer 3

If they’re used for investing, they’re displayed in investment revenue
If they’re used for hedging, they’re displayed as deferred inflows/outflows

Question 4

How does a change in a gov’t pension liability get reported?

Answer 4

Either expense it if it’s due to SIR, or use deferred inflows/outflows if it’s due to AGE (like AOCI)