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International Public Sector Accounting Standards Board (IPSASB) Update on Activities

International Public Sector Accounting Standards Board (IPSASB) Update on Activities. Mike Hathorn Chair IPSASB. Overview. Background IPSASB Strategic Themes Project Updates – Present and Future. IPSASB. Standing Board within IFAC

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International Public Sector Accounting Standards Board (IPSASB) Update on Activities

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  1. International Public Sector Accounting Standards Board (IPSASB)Update on Activities Mike Hathorn Chair IPSASB

  2. Overview • Background • IPSASB Strategic Themes • Project Updates – Present and Future IPSASB UPDATE

  3. IPSASB • Standing Board within IFAC • Develops International Public Sector Accounting Standards (IPSASs) – accrual and cash • Supported by the Canadian Government and CICA, NZ and Swiss Governments, World Bank, UN Group , ADB. • Technical Director and 3 staff Toronto based, 1 New York, 1 Melbourne and 1 UK • Rolling secondment from Chinese Ministry of Finance IPSASB UPDATE

  4. IPSASB Process • 18 Members (3 Public Members) • Meets 3 times per year • 4 day meetings which may include a regional seminar and/or a consultative group meeting. • Open to the public • All materials publicly available – posted on internet IPSASB UPDATE

  5. Developing Standards • Accrual based standards • Convergence with IFRSs unless public sector specific reason for departure – ‘Rules of the Road’ • Public sector specific standards • Current hierarchy – where no IPSAS exists consider IASB standards or national standards • Task Force to review Cash-basis IPSAS IPSASB UPDATE

  6. Transparent “Due Process” • Exposure drafts: at least 4 months for comment • Analyses of submissions • Sub Committees, Task Forces, Project Advisory Panels (PAP) • Consultative Group IPSASB UPDATE

  7. Available on the IPSASB Web Site: • All IPSASs (26 accrual plus 1 cash basis) • (including Spanish and French translations) • All current Exposure Drafts and other publications • IPSASB Updates on most recent IPSASB meetings • IPSASB meeting papers (before each meeting) • Project histories FREE OF CHARGE AT: WWW.IFAC.ORG/PublicSector IPSASB UPDATE

  8. UN System (28 bodies) OECD, NATO (21 bodies), EC, IFAC, INTERPOL Almost 70 countries have agreed processes or have a project in place to adopt IPSASs or align with IPSASs Strong Evidence of Progress IPSASB UPDATE

  9. Disclosures by recipients of external assistance • Aims toharmonize/reduce compliance costs • Requested by OECD/multi-laterals/bi-laterals • Approved at Beijing meeting and incorporated into cash basis IPSAS in early 2008 IPSASB UPDATE

  10. Strategic Themes • Conceptual framework for public sector • Public sector specific issues including convergence with statistical bases where appropriate • IFRS convergence – ‘Rules of the Road’ • Promotion & communication IPSASB UPDATE

  11. Conceptual Framework • Group 1 Consultative Document topics to be considered in March 2008 as one document – Objectives, Reporting Entity, Scope and Qualitative Characteristics • Final review June 2008 • Group 2 topics to be considered in June 2008. IPSASB UPDATE

  12. Social Benefits : Current Approach • ED 34: Disclosure of Cash Transfers to Individuals or Households • requires disclosure of amounts expected to be transferred to eligible individuals or households (not recognition and measurement) • ED 34 approved in principle at Beijing meeting • Consultation Paper on “Social Benefits: Key Issues in Recognition and Measurement” • approved in late February • Initiation of project on long-term fiscal sustainability • project brief will be made publicly available IPSASB UPDATE

  13. Service Concessions IFRIC 12: Service Concession Arrangements issued: November 2006 • Operators only not grantors so limited direct applicability in public sector • Based on control IPSASB Project: Sub Committee supported by US GASB Staff • Not constrained by existing accounting guidance/approaches • Consultation Paper: for approval in March 2008 • Possible accounting approaches: • Control • Risks and rewards • Reversion of asset IPSASB UPDATE

  14. IFRS Convergence • Convergence strategy to update to IASB Standards as at December 2008 by December 2009 • IPSAS 25, “Employee Benefits” • IPSAS 26, “Impairment of Cash-Generating Assets” IPSASB UPDATE

  15. Rules of the Road: Purpose (1) • Codify when divergence from IFRS is appropriate • Clear statement of how IPSASB decides whether to depart from IFRS and when to initiate public sector specific project • Approved at Beijing meeting • Test during 2008 before going on website IPSASB UPDATE

  16. Rules of the Road : Key Steps(2) • Step One: Are there public sector issues that warrant departure? • Step Two: Are the departures so significant that a public sector specific project should be initiated? • Step Three: Modify IASB documents. • Step Four: Issue IPSAS IPSASB UPDATE

  17. Other IFRS Convergence Topics Financial Instruments • Update IPSAS 15 on presentation to converge with IAS 32 • Develop IPSAS on disclosure based on IFRS 7 • Issues Paper to be considered at March 2008 meeting • Aim to issue ED later in 2008 Foreign Exchange • Update IPSAS 4 (ED 33 released July 2007) Borrowing Costs • Update IPSAS 5 IPSASB UPDATE

  18. Topics in work plan for 2008 and 2009 • Entity combinations • Intangible assets • Financial instruments – recognition and measurement • Fair Value • Management’s Discussion & Analysis (MD&A)/Narrative Reporting • Performance Reporting Further consideration of work plan at March 2008 meeting IPSASB UPDATE

  19. International Federation of Accountantswww.ifac.org

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