Key Takeaways
- GASB Statement No. 104 changes what governments disclose about certain capital assets, not how those assets are recognized or measured.
- Lease assets, GASB 94 intangible right-to-use assets, GASB 96 subscription assets, and other intangible assets must now be disclosed separately by major class, rather than lumped in with owned capital assets.
- A new category, capital assets held for sale, requires disclosure of historical cost, accumulated depreciation or amortization, and any pledged debt whenever a sale is probable within one year.
- The standard is effective for fiscal years beginning after June 15, 2025, with retroactive application encouraged where practicable.
- For most Ohio governments, this is a data and documentation exercise: it’s about organizing what you already track, not changing your accounting.
Governmental Accounting Standards Board pronouncements don’t often get nicknames, but GASB 104 earns one: it’s the standard that makes your capital asset footnotes do more talking. Issued in September 2024, GASB Statement No. 104, Disclosure of Certain Capital Assets, doesn’t touch recognition or measurement. It’s squarely about transparency, giving the people who read your financial statements a clearer, more disaggregated picture of what your government owns outright versus what it uses through a lease, subscription, or contractual arrangement, and what it’s planning to sell.
If that sounds like a narrow technical update, it is, but it’s one worth taking seriously well before your fiscal year turns over.
Why This Standard Exists
Over the past several years, GASB 87 (Leases), GASB 94 (Public-Private and Public-Public Partnerships), and GASB 96 (Subscription-Based Information Technology Arrangements) have reshaped how Ohio governments account for the assets they use but don’t own outright. That’s created a lot of new categories sitting inside capital asset notes, often blended together in ways that made it hard for a city council member, bond rating analyst, or citizen watchdog to tell what’s owned versus what’s leased or subscribed. GASB concluded, reasonably, that users evaluate these asset types differently and deserve to see them broken out.
Key Change #1: Separate Disclosure by Asset Type
Under GASB 104, governments must separately disclose, by major class:
- Lease assets recognized under GASB 87
- Intangible right-to-use assets recognized under GASB 94
- Subscription assets recognized under GASB 96
- Other intangible assets
The core rule is simple to state and a little more work to execute: right-to-use assets can no longer be combined with owned assets in the same category. If your fixed asset schedule currently treats a leased fleet vehicle the same as a purchased one, that’s the first thing to unwind.
Key Change #2: Assets Held for Sale
This is the more substantive addition. A capital asset now qualifies as “held for sale” when your government has made the decision to sell it and it’s probable the sale will close within one year of the financial statement date. GASB points to a few practical factors worth documenting as you make that call:
- Is the asset available for immediate sale in its current condition?
- Is there an active, documented search for a buyer underway?
- What do current market conditions suggest about timing?
- Are there regulatory approvals that need to clear first?
Importantly, GASB 104 doesn’t change how these assets are accounted for. They stay in their normal capital asset classification and continue to depreciate or amortize as usual. What’s new is the disclosure: historical cost, accumulated depreciation or amortization, and any debt pledged as collateral, by major asset class, across both governmental and business-type activities. And this isn’t a one-time judgment call. Governments need to reassess held-for-sale classifications every reporting period. If a sale that looked probable a year ago has stalled, that asset comes back out of the held-for-sale disclosure.
What This Means for Your Finance Team
For most Ohio municipalities, counties, and school districts, GASB 104 will feel less like new accounting and more like a filing and documentation project. A few practical steps worth starting now:
- Review your fixed asset records to identify which items fall under leases, subscriptions, or GASB 94 arrangements versus owned assets.
- Flag any assets under active sale consideration and start building the documentation trail (board resolutions, listing agreements, appraisals) that supports a “probable within one year” determination.
- Talk to your auditors early. They’re going to focus on the judgment behind held-for-sale classifications, and getting aligned on your reasoning before fieldwork saves everyone time.
- Plan for retroactive application where practicable, which may mean pulling prior-year data you haven’t had to isolate before.
The Bottom Line
GASB 104 doesn’t ask Ohio governments to account for anything differently. It asks them to explain themselves more clearly, and that’s a fair trade. Better disaggregation between owned and right-to-use assets, plus real visibility into assets on their way out the door, gives council members, bond holders, and residents a more honest read on where your government’s capital stands today, and where it’s headed.
The governments that get ahead of this will spend the next year organizing data. The ones that wait will spend it explaining gaps to auditors. Rea’s government advisors work with Ohio public entities every day on exactly this kind of standard-by-standard transition, and we’re glad to talk through what GASB 104 means for your specific asset mix before it’s part of an audit finding instead of a planning conversation.
About the Author
Owen Shaffer is an Associate at Rea, based in the firm’s Medina, Ohio office, where he supports the government accounting and financial reporting team. Before joining Rea, Owen spent several years in accounting roles handling month-end close, financial reporting, and bookkeeping, experience that gives him a practical, detail-oriented approach to the kind of asset tracking and documentation governments will need as they work through standards like GASB 104. Owen is based in Northeast Ohio and works closely with Rea’s public-sector clients across the region.
