WASHINGTON — With a nod to recent guidance from the tax-exempt community’s accounting rulemaker, a bond attorneys’ group has pulled contentious public pension-disclosure language from its most recent proposal, according to a draft of the group’s pension-disclosure guidance circulated earlier this month.

The National Association of Bond Lawyers has now stripped from its guidance floated in May statements saying governments should provide, “if available,” a 10-year table with the pension’s prospective funding status, based on actuarial projections.

The change essentially defers pension disclosure for financial reporting to the Governmental Accounting Standards Board. NABL’s pension disclosure efforts will focus solely on what is required for bonds’ official statement documents.

The initial language had fractured the group of roughly one dozen industry participants who are participating in the voluntary project on pensions, spearheaded by NABL this spring. Issuers balked at providing future projections of a plan’s funding status, while analysts favored such disclosure, saying it would boost transparency about possible credit risks.

A nine-page Aug. 19 draft, circulated to market participants who convened here for a meeting last week, deleted a four-page section on funding status from the original 13-page draft guidance, including the 10-year prospective funding table. Instead, the revised guidance suggests that plans provide a “plain language summary” of “current and projected funding status,” without specifying a time period for such projections. The guidance also suggests that plans consider providing a description of steps or plans the issuer has “to address future payments.”

“This project is intended to provide considerations for a draftor for providing disclosure and will not mandate providing any particular disclosure,” NABL president John McNally, a partner at Hawkins, Delafield & Wood LLP in Washington, said in an interview. “However, the analysts have made clear they view the projection of future pension payments to be a critical factor in analyzing the creditworthiness of an issuer.”

The chairman of the National Federation of Municipal Analysts, Gregory Clark, declined to comment on the revisions. The Investment Company Institute said it was disappointed with the changes.

An issuer, however, welcomed NABL’s move.

“I can’t think of anything that causes me significant angst about the proposal,” said Ben Watkins, Florida’s director of bond finance. “All in all, I think it’s an improvement.”

In a new one-page introduction, NABL emphasized its pension guidance is geared toward the preparation of official statements. Financial reporting requirements are promulgated by GASB, NABL noyrd.

The group also said its guidance, entitled “Considerations in Preparing Disclosure for Public Defined Benefit Pension Plan in Official Statements,” is designed to supplement three “core” documents that provide “critical information” to investors and analysts: an issuer’s financial statements, a pension plan’s financial statement, and the plan’s actuarial report.

As such, NABL said, its guidance does not require plans to generate any additional accounting or actuarial tables. Instead it supplements the core documents with information that might be material to investors, such as the impact of annual contributions on the issuer’s current and future budgets and any plans the issuer has adopted to address future payments.

In July, two months after NABL released its guidance, GASB unveiled a pension accounting and reporting proposal that would fundamentally alter how cash-strapped states and localities report pension liabilities.

The board’s exposure drafts would, for the first time, require state and local governments to report unfunded pension liabilities on their balance sheets. The proposed standards, which have been released for public comment, would also require state and local governments to provide enhanced disclosure in the notes to their financial statements about an array of pension data and calculations. They include descriptions of the plans and benefits provided, the number of retirees and beneficiaries, and “significant assumptions” in measuring net-pension liability.

Governments also would be required to provide supplementary schedules showing, for the past 10 years, the beginning and ending balances of and changes in the total pension liability as well as the plan trust’s net position and the net pension liability.

Currently, many governments disclose pension information in the footnotes to their financial statements and generally only report the contributions they are required to make in a given year, as well as what they actually paid.

Since releasing its guidance in May, NABL has sought to forge a consensus among market participants, both through written comments and at meetings held in Washington in June and last week.

Some issuers, including Watkins, at first balked at NABL’s effort, resisting the idea of one-size-fits-all disclosure. Watkins also objected to providing speculative information about a plan’s future liabilities.

Analysts, meanwhile, said projections about future liabilities, including five- to 10-year projections of a plan’s prospective funding status, would help shed light on possible credit risks.

NABL’s effort gained new importance when two Securities and Exchange Commission officials — commissioner Elisse Walter and Mark Zehner, the deputy chief of the enforcement division’s muni securities and public pension unit — hailed it as a voluntary industry initiative.

“I think there’s a recognition among the group that if we don’t get this done right, someone else will do it for them,” said Kenneth Artin, a partner at Bryant Miller Olive in Orlando who heads NABL’s pension-disclosure task force. “We’re still on track, still moving forward.”

According to Artin, NABL will distribute a third draft of the guidance to project participants by Sept. 9. The groups will reconvene in Washington on Oct. 25.

GASB expects to release final pension rules in June 2012.

In addition to NFMA and ICI, groups participating in the NABL project are: the National Association of Public Pension Attorneys; the National Association of State Auditors, Comptrollers, and Treasurers; the National Association of State Retirement Administrators; the National Council on Teacher Retirement; the American Institute of Certified Public Accountants, Bond Dealers of America; the Governmental Accounting Standards Board; the Government Finance Officers Association; the National Association of State Treasurers; the Securities Industry and Financial Markets Association, and the Conference of Consulting Actuaries.

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