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    Oct 09, 2009

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    IPSASB eNews

    In This Issue:

    1. IPSASB Confirms Approach on Financial Instruments Project
    2. IPSASB/IMF Joint Task Force Project Progresses
    3. New Zealand Discussion Documents Move IPSAS Convergence Forward
    4. Discussion Started on New IPSASB Strategy
    5. Raising Awareness of the IPSASB
    6. Share IPSASB eNews with Your Colleagues

    1. IPSASB Confirms Approach on Financial Instruments Project

    During its September 2009 meeting in Toronto, the IPSASB confirmed the approach on its financial instruments project after considering responses to three recently released Exposure Drafts (EDs).

    The following were the three EDs under consideration:

    • ED 37, Financial Instruments: Presentation
    • ED 38, Financial Instruments: Recognition and Measurement
    • ED 39, Financial Instruments: Disclosures

    These EDs were issued in April 2009 with a consultation period ending on July 31, 2009.

    One of the objectives of the financial instruments project has been achieving  convergence with the equivalent International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board (IASB), with additional proposed amendments as considered necessary by the IPSASB. 

    The proposed International Public Sector Accounting Standards (IPSASs) incorporate IFRS requirements as of December 31, 2008, as follows:

    • ED 37 was based on IAS 32, Financial Instruments: Presentation
    • ED 38 was based on IAS 39, Financial Instruments: Recognition and Measurement
    • ED 39 was based on IFRS 7, Financial Instruments: Disclosures

    The IPSASB developed additional guidance within the proposed standards on three key public sector specific areas-the distinction between contractual and non-contractual arrangements, concessionary loans, and financial guarantees issued with nil or nominal consideration.

    Many respondents raised concerns about the impending changes the IASB is making to IAS 39 and the impact this may have on the IPSASB's project. The IPSASB discussed this concern in detail and concluded that the project should continue as planned and that any changes the IASB makes to IAS 39 will be considered in due course as deemed necessary.

    More information on the financial instruments project can be found on the IPSASB Project History page at www.ifac.org/PublicSector/ProjectHistory.php?ProjID=0060

    2. IPSASB/IMF Joint Task Force Project Progresses

    Momentum is growing for the joint task force developed by the IPSASB and the International Monetary Fund (IMF) to discuss various interventions by governments in response to the global financial crisis, and the application of accounting standards for reporting such government actions.

    The task force has three objectives:

    • To learn how governments are intending to deal with assets, obligations, and commitments acquired as a result of their actions in response to the financial crisis, and comment/contribute to their thinking
    • To learn about the application of accounting standards for the variety of government actions in response to the financial crisis, and identify the need for any improvements
    • To discuss reporting and valuation approaches for reporting these interventions

    To date, the task force has held meetings with five important sets of stakeholders. The task force updated the IPSASB on its progress on September 11, 2009, and will provide the Board with a draft document summarizing its results on October 31, 2009.

    3. New Zealand Discussion Documents Move IPSAS Convergence Forward

    The New Zealand Ministry of Economic Development (MED) and the New Zealand Accounting Standards Review Board (ASRB) have released two discussion documents that address a proposed new statutory framework for financial reporting for the country.

    The MED paper, The Statutory Framework for Financial Reporting, proposes changes to the New Zealand standard-setting infrastructure and discusses which entities should have financial reporting obligations. The ARSB paper, Proposed Application of Accounting and Assurance Standards under the Proposed New Statutory Framework for Financial Reporting, discusses the changes in accounting standards and assurance requirements that this new framework would entail.

    The primary principle underlying these changes is the idea that reporting requirements should fit the needs of different sectors of users (for example, for-profit versus non-profit), instead of being sector-neutral or one-size-fits-all. Consequently, the papers outline a sector-specific framework that would have different reporting tiers, each with a different level of requirements.

    Included within these recommendations is the proposal that a set of New Zealand public benefit entity standards be developed for use in this sector. These standards would consist of "pure" IPSASs, IPSASs without amendment, for public sector entities.

    4. Discussion Started on New IPSASB Strategy

    As the IPSASB reaches the end of its three-year planning cycle, it has launched a process to gather feedback from Board members to determine its activities and priorities for the next three-year period, 2010-2012.

    A number of factors will impact the Board's work program over the next three years, including availability of staff and volunteer resources, access to funding of IPSASB standard-setting and operating activities, and potential changes to the IPSASB's oversight and governance arrangements.

    The IPSASB staff is currently developing a draft strategy and operational plan that will reflect the Board's discussions. The draft will be circulated to IPSASB members prior to December 2009 for their comment with a view to discuss a revised draft at the December meeting.

    5. Raising Awareness of the IPSASB

    A. Cash Basis Review Roundtable at CReCER 2009

    At the September 2009 CReCER (Spanish acronym of Accounting and Accountability for Regional Economic Growth) Conference in São Paulo, Brazil, a Cash Basis Review Roundtable addressed three key issues:

    • Sharing experiences within Latin America on IPSAS adoption
    • Discussion of cash basis IPSASs, which also addressed the subject of public sector accounting for public/private partnerships and service concession arrangements
    • The need to increase Latin American representation on the IPSASB

    To learn more about the Roundtable, please go to the CReCER 2009 website at www.creceramericas.org.

    B. UNCTAD - IPSAS Conference On October 6, 2009, in Geneva

    The United Nations Conference on Trade and Development hosted a conference titled "Practical Implementation of International Public Sector Accounting Standards" in Geneva, Switzerland on October 6, 2009.

    The topics discussed included the following:

    • Overview of the IPSASB and IPSASs
    • Transitioning from cash basis to accrual accounting
    • Adoption and implementation obstacles and challenges
    • Country experiences in implementing IPSASs

    C. ICPAK to Host Public Sector Accountability Conference November 4-6, 2009, in Nairobi

    The Institute of Certified Public Accountants of Kenya (ICPAK) will host a conference titled "Accountability as a Driver for Socio Economic Development" on Nov. 4-6, 2009, in Nairobi, Kenya.

    The conference is designed to help participants accomplish the following:

    • Fully appreciate the role of IPSASs in their various public sector jurisdictions
    • Understand, engage, and relate to the standards
    • Strengthen services delivery as IPSASs focus on service as opposed to IFRSs, which lean towards wealth maximization for shareholders
    • Strengthen mechanisms for promotion of high standards of financial management and reporting in the public sector

      6. Share IPSASB eNews with Your Colleagues

      The IPSASB issues regular eNews updates to keep you current on its activities and recent publications. Please forward this eNews to any interested colleagues and advise them to subscribe to IPSASB eNews by following these simple steps:

     

    1. Go to the eNews sign-up page at http://www.ifac.org/E-news/index.tmpl.  
    2. Enter your email address, name, and country.
    3. Select "Public Sector eNews" from the checklist as well as any other eNews alerts that you would like to receive.

    You will receive the next issue of the IPSASB eNews directly into your inbox.

    For more information about any of the items mentioned above or other information about the IPSASB, please contact: communications@ifac.org or visit the IPSASB's home page at www.ipsasb.org.

    About IFAC

    IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 157 members and associates in 123 countries, representing more than 2.5 million accountants in public practice, education, government service, industry, and commerce. In addition to setting international public sector financial reporting standards through the IPSASB, IFAC, through its independent standard-setting boards, sets ethics, auditing and assurance, and education standards. It also issues guidance to encourage high-quality performance by professional accountants in business.

     

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