Rule requires Y2K spending reports

A new financial rule requires state and local governments to report the funds and resources they have committed to fix the Y2K bug.

2 min read
The Year 2000 problem knows no difference between a computer in the Pentagon or in a county sheriff's office, so financial rule-makers are now pressing municipal governments to do more on reporting Y2K compliance.

A new financial accounting rule, which went into effect this week, says state and local governments must report the amount of money and resources they have committed to fix the Year 2000 problem and also must disclose what they are doing to make their computer systems Y2K compliant.

The Governmental Accounting Standards Board, which enacted the rule, warned that if local governments don't address the Year 2000 technology problem properly, it could cause wide-spread problems affecting government activities including public safety, budgeting processes, and local power supplies.

The GASB is one operating arm of the Financial Accounting Foundation that is independent of all other government and professional associations. Funding for the GASB is in part from sales of its own publications and in part from governments, the public accounting profession, and the financial community.

Back to Year 2000 Index Page The problem, often called the millennium bug, is rooted in the way dates are recorded and computed. For the past several decades, systems have typically used two digits to represent the year, in order to conserve memory. With this two-digit format, however, the year 2000 is indistinguishable from 1900, or 2001 from 1901.

"The public disclosure should provide a general description of the stages of work in progress or completed?to make computer systems and other electronic equipment critical to conducting operations Year 2000 compliant," according to the Governmental Accounting Standards Board. The additional stages of work necessary for making computer systems and other electronic equipment Year 2000 compliant should also be disclosed.

The status of Year 2000 compliance among states and municipalities is unclear because they have not been required to report the information until now.

The board's move this week comes on the heels of a recent crackdown on delinquent brokerage firms by the Securities and Exchange Commission for failing to report the status of their Year 2000 technology problem preparedness as required by the federal government, the commission said.

Fees or other forms of punishment for state and local governments that don't report their Y2K status were not outlined by the Governmental Accounting Standards Board.

According to the National Association of State Information Resource Executives estimates released earlier in the year , 23 states are still planning their Year 2000 strategies, while 19 states are now implementing and testing conversions. Four states reported being in both the planning and implementation stages.

The National Association of State Information Resource Executives, which represents information resource executives and managers from the 50 states, U.S. territories, and the District of Columbia, has targeted the Year 2000 issue as a key initiative.