IPSASB eNews: December 2019

Dec 20, 2019 | English

The IPSASB held its fourth meeting of 2019 from December 10-13, 2019 in Abu Dhabi, United Arab Emirates. The Department of Finance of Abu Dhabi generously hosted the meeting.

The Public Interest Committee, the body that oversees the standard setting activities of the IPSASB, has launched a public survey on IPSASB governance arrangements. All interested stakeholders are encouraged to participate in this global consultation by February 24, 2020.


Revenue with Performance Obligations
The IPSASB approved ED 70, Revenue with Performance Obligations, and agreed on an exposure period of six months from the date of publication. ED 70 is based on IFRS 15, Revenue from Contracts with Customers, and has been expanded to apply to binding arrangements which are not necessarily contractual. ED 70 also has a broadened scope with a greater emphasis on the transfer of goods or services to third-party beneficiaries.

This ED, together with EDs 71and 72, is expected to be published at the end of February 2020. EDs 71 and 72 will have the same exposure period.

Please register on the IPSASB website to ensure that you receive updates when this document and EDs 71 and 72 (see below) are published: https://www.ifac.org/user/register

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Revenue Without Performance Obligations
The IPSASB approved ED 71, Revenue without Performance Obligations. ED 71 updates IPSAS 23, Revenue from Non-Exchange Transactions (Taxes and Transfers). It addresses revenue that arises from binding arrangements with present obligations which are not performance obligations, and revenue not related to binding arrangements. 

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Transfer Expenses
The IPSASB approved ED 72, Transfer Expenses. Transfer expenses are transactions where an entity transfers resources to another party without directly receiving anything in return.

The accounting for transfer expenses with performance obligations mirrors the accounting for revenue with performance obligations in ED 70. ED 72 does not mirror ED 71, however, as where there are no performance obligations it requires an expense to be recognized immediately. ED 72 does not address taxation.
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The IPSASB revisited the objective and scope of the Leases project and evaluated options for moving the project forward against specified criteria. The IPSASB will continue its work on refining the criteria to analyze options and intends to decide on the approach in March 2020.

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The IPSASB discussed the responses to ED 68, Improvements to IPSAS, 2019. The IPSASB approved the amendments proposed in ED 68 with no significant changes. The IPSASB also agreed to an effective date of January 1, 2021 for these improvements, except for improvements related to IPSAS 41, Financial Instruments, which will have an effective date of January 1, 2022 to align with the effective date of that standard.

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The IPSASB carried out a preliminary review of responses to the Consultation Paper, Measurement.  A number of the issues were raised by respondents related to fair value, including:

  • The meaning of fair value in existing IPSAS;
  • The interaction of fair value with market value;
  • The appropriateness of highest and best use in the public sector; and
  • Inconsistency between replacement cost as a measurement basis and a measurement technique to estimate fair value.

The IPSASB also discussed its preliminary view to expense borrowing costs, rather than capitalizing them, noting respondents were split in their views. The IPSASB instructed staff to bring a recommendation forward for its consideration in March 2020.
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Infrastructure Assets
The IPSASB approved the flowchart  for determining whether additional guidance is needed and, if so, whether it should be authoritative or non-authoritative. The flowchart was tested by analyzing issues related to the separation of land under or over infrastructure assets, the control of such land and valuation. The IPSASB instructed staff to revise the draft additional guidance, so that it addresses all the financial reporting issues impacting the accounting for land under or over infrastructure assets. The revised draft guidance will be considered at the March 2020 meeting. 

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Meeting Podcast
A podcast highlighting key points of the December 2019 meeting is now available here.

Next Meeting
The next meeting of the IPSASB will be in New York from March 10-13, 2020. For more information, or to register as an observer, visit the IPSASB website.



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