IPSASB Developments
Ian Carruthers
IPSASB Member
Executive Director, Policy and Technical, CIPFA
IPSASB Developments
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Conceptual Framework – October 2014
Strategy and Work Plan 2015-2019
First Time Adoption (IPSAS 33) – January 2015
Accounting for Interests in Other Entities (IPSASs 34 – 38)
– January 2015
• RPG3 - Service Performance Reporting – March 2015
CF Preface: Characteristics of the Public Sector
Statistical
Reporting
Regulatory
Role
Nature &
Purpose of
Assets &
Liabilities
NonExchange
Transactions
Approved
Budget
Nature &
Longevity
of Public
Sector
CF Chapter 1:
Role and Authority of the Conceptual Framework
Role
• Concepts underpinning
general purpose financial
reporting
• Accrual Basis
Authority
• No authoritative requirements
• No override of requirements of
International Public Sector
Accounting Standards™
(IPSASs™) or Recommended
Practice Guidelines (RPGs)
CF Chapter 2:
Objectives and Users
• Objectives of Financial Reporting
– Provide information about entity useful to users of
GPFRs
– Accountability purposes and decision-making
purposes
– Reflects service delivery objective and nature of
funding
– Respond to information needs of users
• Users of GPFRs
– Primary users: service recipients and resource
providers
CF Chapter 3:
The QCs
Relevance
Faithful Representation
Understandability
Timeliness
Comparability
Verifiability
CF Chapter 4:
The Reporting Entity
• Government or other public sector organisation, program or
identifiable area of activity that prepares GPFRs
• Key characteristics
– Raises or uses resources from / on behalf of constituents; and
– Service recipients or resource providers dependent on GPFRs
• May comprise two or more separate units / organisations
• Separate legal identity not essential
CF Chapter 5:
Defined Elements
Asset
Liability
Revenue
Ownership
Contributions
Expense
Ownership
Distributions
CF Chapter 5:
Net Financial Position / Other Economic Phenomena
• Recognition of economic phenomena not captured by elements
definitions potentially necessary
• IPSASs could require or allow recognition of resources or obligations
not satisfying element definitions:
– ‘other resources’ (deferred inflows at ED stage)
– ‘other obligations’ (deferred outflows at ED stage)
• Net financial position instead of Net Assets
= difference between assets and liabilities after adding other
resources and deducting other obligations.
CF Chapter 6:
Recognition – The Criteria
Item Satisfies Definition of an Element
Can be Measured in a way that:
• Achieves QCs
• Takes account of Constraints
Not Incorporated in Element Definitions
CF Chapter 7:
Measurement
• Measurement Objective:
‘to select those measurement bases that
most fairly reflect the cost of services,
operational capacity and financial
capacity of the entity in a manner that is
useful in holding the entity to account,
and for decision-making purposes’
• No single measurement basis
(or group of bases) identified
Asset
Liability
Historical Cost
Current Value
Market value
Cost of fulfillment
Replacement cost
Market value
Net selling price
Cost of release
Value in use
Assumption price
CF Chapter 8:
Presentation
Information
Selection
Information
Location
Information
Organization
IPSASB CF Compared to the IASB
IPSASB
IASB
Role
Concepts that underpin general purpose financial
reporting; does not override standards
Concepts that underlie the preparation and presentation of
financial statements; does not override standards
Scope
General purpose financial reports (GPFRs)
1989 Framework – relates to financial statements – 2010
Framework sections refer to GPFRs
Objective
Financial information - useful for accountability and
decision-making purposes. Users service recipients
and resource providers
Financial information - to provide investors, lenders and
other creditors making decisions about providing resources
to the entity
Qualitative
Characteristics
Definitions very similar to IASB Framework; no split
between fundamental and enhancing characteristics
Split between fundamental and enhancing characteristics
Elements
Definitions similar
Net financial position & “other economic phenomena”
Definitions similar; tentative decisions on “economic
resources”
Measurement
Measurement objective
“Fair Value” not identified as measurement basis.
Tentative decision – no measurement objective (factors to
consider when selecting a measurement basis)
Reporting
IPSASB principles for information selection, location
and organisation in broader GPFRs
Discussion paper and exposure draft has/is anticipated to
include a new chapter on presentation and disclosure
IPSASB Strategic Objective 2015
Strengthening public financial management and knowledge
globally through increasing adoption of accrual-based IPSASs by:
• Developing high-quality public sector financial reporting
standards;
• Developing other publications for the public sector; and
• Raising awareness of the IPSASs and the benefits of their
adoption.
Ongoing projects
• Public Sector Combinations
• Government Business Enterprises
• Public Sector Specific Financial Instruments
• Emissions Trading Schemes – collaboration with IASB
• Social Benefits – project re-started
Work Plan 2015-2019
Balancing development and maintenance
“must-do” projects
2015-2019
• Non-exchange expenses;
• Revenues – exchange and
non-exchange;
• Measurement – public sector
specific;
• Heritage assets; and
• Infrastructure assets.
existing IPSASs which
need maintaining
• Employee benefits;
• Leases
• Annual improvements
• Cash Basis IPSAS
Accounting for Interests in Other Entities
In January 2015 the IPSASB issued:
• IPSAS 34 Separate Financial Statements
• IPSAS 35 Consolidated Financial Statements
• IPSAS 36 Investments in Associates and Joint Ventures
• IPSAS 37 Joint Arrangements
• IPSAS 38 Disclosure of Interests in Other Entities
Features:
• Based on IFRS equivalents
• Different terminology, including relevant public sector
illustrations
• Clarifications on the applicability of the Standards to accounting
by public sector entities.
Questions Discussion & Further Information
• Visit our webpage http://www.ipsasb.org/
• Or contact us by e-mail:
Chair IPSASB: andreasbergmann@ipsasb.org
Technical Director: stepheniefox@ipsasb.org
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