Bracing For the Shock of Conversion to GAAP

It's the budgetary day of reckoning that state officials have avoided for nearly two decades.

But when Gov.-elect Dan Malloy attempts to convert state financing to generally accepted accounting principles starting next year, it's likely to mean more than paying for over $1 billion in papered-over problems from the past.

For a legislature that initially mandated GAAP conversion in 1993--and has postponed it repeatedly since 1995--it will mean immediately swearing off an array of fiscal gimmicks that has enabled it to balance a series of budgets with hundreds of millions of dollars in phantom savings and creative accounting.

Lt. Gov.-elect Nancy Wyman: 'We might as well face the problems' (Keith M. Phaneuf)

"The fact is that the gimmicks are gone," said Lt. Gov.-elect Nancy Wyman, who has spearheaded the push to follow GAAP rules since she became comptroller in 1995. "While we're facing our new problems, we might as well face the problems we avoided previously."

According to the Government Accounting Standards Board, that means following a series of common financial guidelines--already imposed on Connecticut cities and towns--that emphasize transparency.

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