Highlights from the IPSASB’s December 8-11, 2014, meeting in Toronto, Canada.

:40 – Chair’s Opening Remarks

3:03 – Strategy and Work Plan

5:33 – IPSASs 34-38

7:14 – IPSAS 33

8:25 – Recommended Practice Guideline 3, Reporting Service Performance

10:07 – Social Benefits

11:46 – Public Sector Combinations

14:04 – Public Sector Financial Instruments

16:41 – Chair’s Closing Remarks

17:30 – Next Meeting 

Former International Public Sector Accounting Standards Board member Anne Owuor was a panelist at the International Conference on Professional Ethics and Public Sector Accounting held July 29-30, 2014, in Lilongwe, Malawi.

The Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities (the Conceptual Framework) provides the International Public Sector Accounting Standards Board™ (IPSASB™) with the concepts that will underpin the development of International Public Sector Accounting Standards™ (IPSASs™) and Recommended Practice Guidelines (RPGs) in the coming years.

The International Public Sector Accounting Standards Board^® (IPSASB^®) has published its Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities (the Conceptual Framework), following the approval of the final four chapters at its September 2014 meeting.

The publication of the Conceptual Framework provides the IPSASB with the concepts that will underpin the development of International Public Sector Accounting Standards™ (IPSASs™) and Recommended Practice Guidelines (RPGs) in the coming years. It enables the IPSASB to further improve the consistency of its standard-setting by strengthening the linkage between IPSASs. Additionally, the transparency of the concepts underpinning the development of IPSASs and RPGs enhances the IPSASB’s accountability.

The primary objective of most public sector entities is to deliver services to the public, rather than to make profits and generate a return on equity to investors. The Conceptual Framework responds to key public sector characteristics in its approach to elements (the building blocks of financial statements), the measurement of assets and liabilities, and the presentation of financial reports, while focusing on service recipients’ and resource providers’ needs for high-quality financial reporting information for both accountability and decision-making purposes.

“The publication of the Conceptual Framework is a landmark in global public sector financial reporting and is indicative of the IPSASB’s growing maturity as a global public sector standard-setter,” said IPSASB Chair Andreas Bergmann. “It reflects the unique characteristics of the public sector and puts the IPSASB in a strong position to focus on key standard-setting activities over the next few years. The IPSASB has already made sound initial progress on its social benefits project and the completion of the Conceptual Framework provides further impetus for this important initiative.” 

Prof. Bergmann said the IPSASB will be making decisions on new projects in early 2015.

About the IPSASB
The IPSASB develops accounting standards and guidance for use by public sector entities.  It 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.  The structures and processes that support the operations of the IPSASB are facilitated by IFAC.

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 179 members and associates in 130 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.

International Public Sector Accounting Standards Board (IPSASB) Chair Andrea Bergmann, Deputy Chair Ron Salole, IPSASB Member Guohua Huang, and IFAC Board Member Ahmadi Hadibroto were featured speakers at an Asian Development Bank Regional Workshop on Public Sector Accounting held September 29-30, 2014, in Jakarta, Indonesia.  

Highlights from the IPSASB's September 15-18, 2014, meeting in Brussels, Belgium.

:54 – Approval of Conceptual Framework

2:11 – Updates on Current Projects

4:04 – Strategy and Work Plan Consultation

5:33 - Social Benefits Consultation Paper

6:18  - Chair’s Closing Remarks  

The International Public Sector Accounting Standards Board^® (IPSASB^®) has approved its Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities (the Conceptual Framework).

The Conceptual Framework establishes the concepts that will guide the IPSASB’s approach to standard-setting and guidance. It addresses concepts applicable to both public sector financial statements and a wider set of public sector financial reporting needs. The Conceptual Framework identifies and responds to the key characteristics of the public sector, notably that the primary purpose of most governments and public sector entities is to deliver services to citizens and others. Therefore, the purpose of financial reporting in the public sector is to provide useful information for service recipients and resource providers.

“Approving the Conceptual Framework is a historic achievement for the IPSASB and a landmark for setting global accounting standards for the public sector,” said IPSASB Chair Andreas Bergmann. “These concepts will provide the basis for our ongoing development of consistent and useful International Public Sector Accounting Standards™ (IPSASs™) and Recommended Practice Guidelines (RPGs). They will also provide guidance to preparers faced with financial reporting issues not dealt with by IPSASs or RPGs.”

The completed Conceptual Framework is expected to be issued by the end of October 2014. The final four chapters were approved by the IPSASB during its September meeting. Those four chapters, which address the definition, recognition, and measurement of the “elements” (or building blocks) of financial statements and presentation in General Purpose Financial Reports, join the original four chapters, which were issued early in 2013, bringing the entire Conceptual Framework to eight chapters. The development process included eight public consultations with the IPSASB‘s global constituency.

The Conceptual Framework project has been the key strategic priority for the IPSASB in recent years. Its successful completion allows the IPSASB to focus on projects to be identified through its public consultation on strategy for 2015 forward and work program for 2015-2019, along with projects already initiated, including social benefits. The Conceptual Framework will provide a solid basis for future standard setting by the IPSASB. The IPSASB will continue to work in the public interest, responding to the global financial reporting needs of governments and other public sector entities as appropriate.

About the IPSASB
The IPSASB develops accounting standards and guidance for use by public sector entities.  It 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.  The structures and processes that support the operations of the IPSASB are facilitated by IFAC.

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 179 members and associates in 130 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.

The International Public Sector Accounting Standards Board^® (IPSASB^®) has released its 2013-2014 Update, Leading through Change. In addition to containing reports from the Chair and Technical Director, it highlights the IPSASB’s work in completing the Public Sector Conceptual Framework and developments regarding its outreach efforts, future strategy and work program, and governance and oversight. 

The International Public Sector Accounting Standards Board^® (IPSASB^®) today released for comment a Consultation Paper (CP), The Applicability of IPSASs to Government Business Enterprises and Other Public Sector Entities.

Government Business Enterprises (GBEs) are generally commercially oriented entities that can have a significant impact on a government’s financial performance and financial position. Globally, GBEs vary in size, the goods and services they deliver, their financial objectives, and their governance arrangements. GBEs include major enterprises in areas such as transportation and utilities.

Currently, the term “GBE” is defined in International Public Sector Accounting Standard™ (IPSAS™) 1, Presentation of Financial Statements. IPSASs are not developed for GBEs. The scope section of each IPSAS states that GBEs apply International Financial Reporting Standards issued by the International Accounting Standards Board. The IPSASB has received feedback indicating there are a wide range of entities being described as GBEs. Some of these entities clearly do not meet the IPSASB definition of a GBE. In other cases, there are different interpretations of components of the definition.

The IPSASB has developed two approaches to communicate its view of the entities to which IPSASs apply. Under the first approach, the IPSASB would describe the characteristics of public sector entities for which IPSASs are intended. This would be done by either drawing on the IPSASB’s current and developing literature or by reference to terminology in Government Finance Statistics reporting guidelines.  Under this approach, there would no longer be a definition of GBE in the IPSASB literature.

Under the second approach, the definition of a GBE would be retained. The IPSASB would clarify the GBE definition and would possibly narrow it to entities with a profit-seeking objective.

The IPSASB’s preliminary view is that the first of these two approaches is the best way forward. This is because it is principles-based and focuses on the high-level characteristics of entities for which IPSASs are intended.

“The IPSASB acknowledges the role of regulators in determining the accounting standards to be applied by different entities in their jurisdictions,” said IPSASB Chair Andreas Bergmann. “The IPSASB considers that it has a responsibility to be transparent about the types of public sector entities for which it is developing IPSASs. We look forward to hearing whether constituents support the approach of providing a high-level description of the characteristics of public sector entities for which IPSASs are intended or, instead, retention and improvement of the definition of a GBE.”

How to Comment
To access the Consultation Paper and the At-a-Glance document, which provides a summary of the Consultation Paper, or to submit a comment, please visit the IPSASB website at www.ipsasb.org. Comments on the Consultation Paper are requested by December 31, 2014. The IPSASB encourages IFAC members, associates, and regional accountancy bodies to promote the availability of this Consultation Paper to their members and employees.

About the IPSASB
The IPSASB develops accounting standards and guidance for use by public sector entities.  It 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.  The structures and processes that support the operations of the IPSASB are facilitated by IFAC.

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 179 members and associates in 130 countries and jurisdictions, representing approximately 2.5 million accountants in public practice, education, government service, industry, and commerce.