The International Public Sector Accounting Standards Board (IPSASB) has issued Recommended Practice Guideline 2 (RPG 2), Financial Statement Discussion and Analysis.
Financial statement discussion and analysis assists users to understand the financial position, financial performance, and cash flows presented in an entity’s general purpose financial statements. It also enables users to gain further insights into the operations of the entity, from the perspective of the entity itself. RPG 2 provides guidance for presenting such information.
While the form and content of the information depends on the nature of the entity and its regulatory environment, financial statement discussion and analysis will generally include:
- An overview of the entity’s operations and environment;
- Information about the entity’s objectives and strategies;
- An analysis of the entity’s financial statements; and
- Risks and uncertainties related to the financial statements.
“Financial statement discussion and analysis presented in accordance with RPG 2 represents good practice,” explained IPSASB Chair Andreas Bergmann. “It sets out the status, scope, and reporting boundary for the information. RPG 2 is intended to encourage more public sector entities to provide users with financial statement discussion and analysis.”
Dr. Bergmann added, “It will promote comparability across entities that present financial statement discussion and analysis; at the same time, its flexible application will benefit entities in jurisdictions that have local requirements or regulations. The issuance of RPG 2 is an important step for the IPSASB, because it further extends our pronouncements on presentation of information beyond that presented in general purpose financial statements.
How to Obtain the RPG
To access the RPG, visit the IPSASB website. The IPSASB encourages IFAC members, associates, and regional accountancy bodies to promote the availability of these documents to their members and employees.
About the IPSASB
The IPSASB develops accounting standards and guidance for use by public sector entities. The structures and processes that support the operations of the IPSASB are facilitated by IFAC. The IPSASB receives support (both direct financial and in-kind) from the World Bank, the Asian Development Bank, the Chartered Professional Accountants of Canada, the South African Accounting Standards Board, and the governments of Canada, New Zealand, and Switzerland.
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. It is comprised of 173 members and associates in 129 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.
# # #