Post on 20-Mar-2016
description
IPSASBIPSASB
Financial Management Institute Public Sector Financial Management Institute Public Sector Management WorkshopManagement Workshop
International Federation of AccountantsInternational Federation of Accountants
International Public Sector Accounting International Public Sector Accounting Standards Board (IPSASB)Standards Board (IPSASB)
Joy KeenanJoy Keenan
Regina June 2, 2009
IPSASBIPSASB
Overview of SessionOverview of Session
• Introduce IFAC and IPSASBIntroduce IFAC and IPSASB• Discuss IPSASB’s mission and strategic themesDiscuss IPSASB’s mission and strategic themes• Provide an overview of various projects under way Provide an overview of various projects under way • Q & AQ & A
Regina June 2, 2009
IPSASBIPSASB
What is IFAC?What is IFAC?• Expanding organization – currently, 157 member bodies and Expanding organization – currently, 157 member bodies and
associates in 123 countriesassociates in 123 countries• Represents over 2.5 million accountants in public practice, Represents over 2.5 million accountants in public practice,
education, government service, industry and commerceeducation, government service, industry and commerce• Sets standards for auditing & assurance, ethics, education and Sets standards for auditing & assurance, ethics, education and
public sector accountingpublic sector accounting• Also issues guidance to support professional accountants in Also issues guidance to support professional accountants in
business, small and medium practices, and developing nationsbusiness, small and medium practices, and developing nations
IFACIFAC
Regina June 2, 2009
IPSASBIPSASB
What is IPSASB?What is IPSASB?• Standing IFAC BoardStanding IFAC Board• Consists of 18 volunteer Members from around the world, including Consists of 18 volunteer Members from around the world, including
two from Canada:two from Canada:– 15 Members nominated through IFAC member bodies and 3 members serve as 15 Members nominated through IFAC member bodies and 3 members serve as
public memberspublic members– Experience and expertise in public sector financial reportingExperience and expertise in public sector financial reporting– Ministries of finance, government audit institutions, public practice and public Ministries of finance, government audit institutions, public practice and public
members – but, they serve as individuals not as representatives of their members – but, they serve as individuals not as representatives of their organizationorganization
– Staff is mainly Toronto-based Staff is mainly Toronto-based
• Issues and promotes benchmark guidance and facilitates the exchange Issues and promotes benchmark guidance and facilitates the exchange of information among its constituentsof information among its constituents
Regina June 2, 2009
IPSASBIPSASB
IPSASBIPSASB Membership Membership
Regina June 2, 2009
IPSASBIPSASB
Strategic PartnershipsStrategic PartnershipsThe IPSASB receives assistance from various of its The IPSASB receives assistance from various of its constituents in developing its standards:constituents in developing its standards:• Supported by Canadian, US and Swiss governmentsSupported by Canadian, US and Swiss governments•United Nations – major adopterUnited Nations – major adopter•World Bank and Development Banks (IADB, ADB)World Bank and Development Banks (IADB, ADB)•IMFIMF•IFAC – Developing Nations CommitteeIFAC – Developing Nations Committee•IASBIASB•National Standard Setters, including the CICA – provide staff National Standard Setters, including the CICA – provide staff supportsupport•INTOSAIINTOSAI
Regina June 2, 2009
IPSASBIPSASB
The IFAC IPSASB MissionThe IFAC IPSASB MissionTo serve the public interest by developing To serve the public interest by developing high quality accounting standards for use by high quality accounting standards for use by public sector entities around the world, public sector entities around the world, including international organisations, in the including international organisations, in the preparation of general purpose financial preparation of general purpose financial statements. statements.
Regina June 2, 2009
IPSASBIPSASB
What the IFAC IPSASB DoesWhat the IFAC IPSASB Does
The IPSASB achieves its objectives by:The IPSASB achieves its objectives by:• Issuing International Public Sector Accounting Issuing International Public Sector Accounting
Standards (IPSASs)Standards (IPSASs)• Publishing other documents which provide guidance Publishing other documents which provide guidance
on issues and experiences in financial reporting in on issues and experiences in financial reporting in the public sectorthe public sector
• Promoting their acceptance and the international Promoting their acceptance and the international convergence to these standardsconvergence to these standards
Regina June 2, 2009
IPSASBIPSASB
What are the IPSASs?What are the IPSASs?• The IPSASs represent international best practice in financial The IPSASs represent international best practice in financial
reporting by public sector entitiesreporting by public sector entities• In many jurisdictions, the application of the requirements of In many jurisdictions, the application of the requirements of
IPSASs will enhance the accountability and transparency of the IPSASs will enhance the accountability and transparency of the financial reports prepared by governments and their agenciesfinancial reports prepared by governments and their agencies
• High-quality financial reporting and financial management by High-quality financial reporting and financial management by international organizations and governments worldwide is vital international organizations and governments worldwide is vital to economic growth and stability for both developed and to economic growth and stability for both developed and developing countries - this is particularly important now developing countries - this is particularly important now because of the global economic crisisbecause of the global economic crisis
Regina June 2, 2009
IPSASBIPSASB
Public Sector StudiesPublic Sector Studies
• 14 studies issued to date14 studies issued to date• Most recent – Most recent – Transition to the Accrual Basis of Transition to the Accrual Basis of
Accounting: Guidance for Governments and Accounting: Guidance for Governments and Government Entities Government Entities
– This Study is intended to assist governments and This Study is intended to assist governments and government entities wishing to migrate to the accrual basis government entities wishing to migrate to the accrual basis of accounting in accordance with IPSASsof accounting in accordance with IPSASs
Regina June 2, 2009
IPSASBIPSASB
Strong Evidence of ProgressStrong Evidence of Progress• Adoption of IPSASsAdoption of IPSASs– UN System (28 bodies)UN System (28 bodies)– OECD, NATO (21 bodies), EC, IFAC, INTERPOLOECD, NATO (21 bodies), EC, IFAC, INTERPOL– Over 70 countries have agreed processes or have a project Over 70 countries have agreed processes or have a project
in place to adopt IPSASs or align with IPSASsin place to adopt IPSASs or align with IPSASs
Regina June 2, 2009
IPSASBIPSASB
IPSASB Strategic ThemesIPSASB Strategic Themes
• Public sector conceptual frameworkPublic sector conceptual framework• IFRS ConvergenceIFRS Convergence• Public sector specific projectsPublic sector specific projects• Promotion, communications and outreachPromotion, communications and outreach
Regina June 2, 2009
IPSASBIPSASB
Public Sector Conceptual FrameworkPublic Sector Conceptual Framework• Series of interrelated papersSeries of interrelated papers• Phase 1 Consultation Paper (CP) issued Sept 2008 that addressed:Phase 1 Consultation Paper (CP) issued Sept 2008 that addressed:
– scope of the financial statementsscope of the financial statements– objectives & users of general purpose financial statementsobjectives & users of general purpose financial statements– reporting entityreporting entity– qualitative characteristics of financial informationqualitative characteristics of financial information
• Phase 2 CP to address:Phase 2 CP to address:– definition & recognition of elements of financial assets (e.g., assets, liabilities, revenues and definition & recognition of elements of financial assets (e.g., assets, liabilities, revenues and
expenses)expenses)• Phase 3 CP to address the measurement bases consistent with the objectives of Phase 3 CP to address the measurement bases consistent with the objectives of
financial reporting, the qualitative characteristics of financial information and the financial reporting, the qualitative characteristics of financial information and the recognition criteria recognition criteria
• In May 2009, the IPSASB discussed the responses to CP1 as well as preliminary drafts In May 2009, the IPSASB discussed the responses to CP1 as well as preliminary drafts of CP2 and CP3of CP2 and CP3
Regina June 2, 2009
IPSASBIPSASB
Conceptual Framework (cont’d)Conceptual Framework (cont’d)
• This is not a convergence projectThis is not a convergence project– The IPSASB is not bound by the timetable and principles in the The IPSASB is not bound by the timetable and principles in the
IASB projectIASB project
• The conceptual framework will help answer The conceptual framework will help answer questions such as:questions such as:
– Is GM an investment of the federal and Ontario governments?Is GM an investment of the federal and Ontario governments?– Is it a public sector entity because of public ownership?Is it a public sector entity because of public ownership?– Is it something else?Is it something else?– On what basis and at what amount should it be measured?On what basis and at what amount should it be measured?
Regina June 2, 2009
IPSASBIPSASB
IFRS ConvergenceIFRS Convergence• Target date December 31, 2009 for IFRS as at Target date December 31, 2009 for IFRS as at
December 31, 2008December 31, 2008• Major projects to be completed:Major projects to be completed:
• Financial instrumentsFinancial instruments• Intangible assetsIntangible assets• Entity combinationsEntity combinations• AgricultureAgriculture
• Renewed focus on regular liaison with IASB Renewed focus on regular liaison with IASB (Chair, Vice-Chair, Public Member)(Chair, Vice-Chair, Public Member)
Regina June 2, 2009
IPSASBIPSASB
IFRS Convergence EDs ApprovedIFRS Convergence EDs Approved• Four Exposure Drafts (EDs) were approved at Four Exposure Drafts (EDs) were approved at
IPSASB’s February 2009 meeting:IPSASB’s February 2009 meeting:– ED 36 – ED 36 – Agriculture (IAS 41)Agriculture (IAS 41)– ED 37 – ED 37 – Financial Instruments: Presentation (IAS 32)Financial Instruments: Presentation (IAS 32)– ED 38 – ED 38 – Financial Instruments: Recognition and Financial Instruments: Recognition and
Measurement (IAS 39)Measurement (IAS 39)– ED 39 – ED 39 – Financial Instruments: Disclosures (IFRS 7)Financial Instruments: Disclosures (IFRS 7)
Regina June 2, 2009
IPSASBIPSASB
IFRS Convergence EDs Approved IFRS Convergence EDs Approved (cont’d)(cont’d)
• Two EDs were approved out-of-session and issued Two EDs were approved out-of-session and issued in May:in May:
– ED 40 – ED 40 – Intangible Assets (IAS 38)Intangible Assets (IAS 38)– ED 41 – ED 41 – Entity Combinations from Exchange Entity Combinations from Exchange
Transactions (IFRS 3)Transactions (IFRS 3)• All the EDs are available at: All the EDs are available at:
http://www.ifac.org/PublicSector/ExposureDrafts.http://www.ifac.org/PublicSector/ExposureDrafts.phpphp
Regina June 2, 2009
IPSASBIPSASB
Financial InstrumentsFinancial Instruments• The IPSASB’s quick response in converging these standards The IPSASB’s quick response in converging these standards
recognizes the important public sector role in addressing the global recognizes the important public sector role in addressing the global economic crisiseconomic crisis
• Convergence with IFRS 7, IAS 32 and IAS 39Convergence with IFRS 7, IAS 32 and IAS 39• Changes made only to address specific public sector issues (e.g., in ED 39, Changes made only to address specific public sector issues (e.g., in ED 39,
additional disclosures proposed for concessionary loans)additional disclosures proposed for concessionary loans)
• The IPSASB has just issued a press release indicating it will The IPSASB has just issued a press release indicating it will proceed with developing these standards – any changes made by proceed with developing these standards – any changes made by the IASB will be addressed in due coursethe IASB will be addressed in due course
• ED response date: July 31, 2009ED response date: July 31, 2009• Staff contact: johnstanford@ifac.org Staff contact: johnstanford@ifac.org
Regina June 2, 2009
IPSASBIPSASB
AgricultureAgriculture
• IAS 41 convergenceIAS 41 convergence• Minor changes in terminologyMinor changes in terminology• Inclusion of non-exchange transactionsInclusion of non-exchange transactions• Scope excludes biological assets held for the Scope excludes biological assets held for the
supply of servicessupply of services• ED response date: June 30, 2009ED response date: June 30, 2009• Staff contact: johnstanford@ifac.org Staff contact: johnstanford@ifac.org
Regina June 2, 2009
IPSASBIPSASB
Intangible AssetsIntangible Assets
• IAS 38 convergenceIAS 38 convergence• Incorporates SIC-32 guidance for web site costsIncorporates SIC-32 guidance for web site costs• Does not address powers to grant rights and to Does not address powers to grant rights and to
taxtax• ED response date: August 15, 2009ED response date: August 15, 2009• Staff contact: joykeenan@ifac.orgStaff contact: joykeenan@ifac.org
Regina June 2, 2009
IPSASBIPSASB
Entity CombinationsEntity Combinations• Two projectsTwo projects• Entity Combinations from Exchange TransactionsEntity Combinations from Exchange Transactions
– IFRS 3 ConvergenceIFRS 3 Convergence– ED response date: August 15, 2009ED response date: August 15, 2009
• Entity Combinations from Non-Exchange TransactionsEntity Combinations from Non-Exchange Transactions– Public sector specific project (e.g., recent government Public sector specific project (e.g., recent government
interventions)interventions)– Work is under wayWork is under way• Staff contact: annettedavis@ifac.org Staff contact: annettedavis@ifac.org
Regina June 2, 2009
IPSASBIPSASB
Public Sector Specific ProjectsPublic Sector Specific Projects• Long-term fiscal sustainabilityLong-term fiscal sustainability• Review of cash basis standardReview of cash basis standard• Service concession arrangements (SCAs)Service concession arrangements (SCAs)• Social benefitsSocial benefits• Heritage assetsHeritage assetsSee IPSASB project pages for additional details and
contact informationhttp://www.ifac.org/PublicSector/Projects.php#InProgress
Regina June 2, 2009
IPSASBIPSASB
Long-term Fiscal SustainabilityLong-term Fiscal Sustainability• This project has taken on increased importance in light of public This project has taken on increased importance in light of public
sector interventions to respond to the global economic crisissector interventions to respond to the global economic crisis• The IPSASB discussed a draft Consultation Paper (CP) at its May The IPSASB discussed a draft Consultation Paper (CP) at its May
18-21, 2009 meeting18-21, 2009 meeting• Project will consider issues including:Project will consider issues including:
– Defining what is meant by “fiscal sustainability”Defining what is meant by “fiscal sustainability”– Explaining why it is importantExplaining why it is important– Exploring how it can be reported in GPRS, including what indicators should be Exploring how it can be reported in GPRS, including what indicators should be
reportedreported
• Staff contact: johnstanford@ifac.org Staff contact: johnstanford@ifac.org
Regina June 2, 2009
IPSASBIPSASB
Review of Cash Basis IPSASReview of Cash Basis IPSAS• Primary objective is to identify the major technical issues Primary objective is to identify the major technical issues
that public sector entities in developing economies have that public sector entities in developing economies have encountered, or are anticipated to encounter, in encountered, or are anticipated to encounter, in implementing the standardimplementing the standard
– The IPSASB will then consider whether to modify the Standard in light of The IPSASB will then consider whether to modify the Standard in light of these difficulties and/or whether to provide further guidance on its these difficulties and/or whether to provide further guidance on its applicationapplication
• The review will also identify whether additional reporting The review will also identify whether additional reporting requirements should be added to the standardrequirements should be added to the standard• Staff contact: paulsutcliffe@ifac.org Staff contact: paulsutcliffe@ifac.org
Regina June 2, 2009
IPSASBIPSASB
Service Concession ArrangementsService Concession Arrangements• CP issued in March 2008CP issued in March 2008• Respondents expressed broad support for the proposed views in Respondents expressed broad support for the proposed views in
the CPthe CP• Work is under way to develop an ED that will:Work is under way to develop an ED that will:
– Define an SCADefine an SCA– Determine when to report the property as an asset using a control-based approachDetermine when to report the property as an asset using a control-based approach– Provide accounting and reporting guidance and examples in a variety of scenarios, Provide accounting and reporting guidance and examples in a variety of scenarios,
including when the control criteria are not metincluding when the control criteria are not met– Give guidance on accounting for and reporting guarantees, contingent liabilities and Give guidance on accounting for and reporting guarantees, contingent liabilities and
contingent assets related to SCAscontingent assets related to SCAs
• Staff contact: joykeenan@ifac.org Staff contact: joykeenan@ifac.org
Regina June 2, 2009
IPSASBIPSASB
Looking AheadLooking Ahead• Completion of convergence initiative and Completion of convergence initiative and
completion of the conceptual framework will allow completion of the conceptual framework will allow increased focus on public sector issuesincreased focus on public sector issues– Improve consistency, transparency and Improve consistency, transparency and
accountability in financial reporting among accountability in financial reporting among public sector entitiespublic sector entities
– Improve harmonization between statistical and Improve harmonization between statistical and accrual bases of accountingaccrual bases of accounting
Regina June 2, 2009
IPSASBIPSASB
Promoting Acceptance of the IPSASsPromoting Acceptance of the IPSASs
• Members and staff are involved in ongoing and Members and staff are involved in ongoing and extensive promotion, communications and extensive promotion, communications and outreach activities both within their own outreach activities both within their own jurisdictions and internationally to promote the jurisdictions and internationally to promote the IPSASs IPSASs
• Widespread adoption is our ultimate goalWidespread adoption is our ultimate goal
Regina June 2, 2009
IPSASBIPSASB
International Federation of AccountantsInternational Federation of Accountantswww.ifac.orgwww.ifac.org
Regina June 2, 2009