IPSASB eNews: April 2013

Apr 16, 2013 | New York, New York | English

Thank you for subscribing to the eNews from the International Public Sector Accounting Standards Board (IPSASB). This edition provides a summary of decisions made at the IPSASB’s meeting held March 11-14, 2013, in Abu Dhabi. Please go to the IPSASB Meeting Page for the meeting highlights and relevant agenda items.


1. Conceptual Framework  ED 4, Presentation in General Purpose Financial Reports
2. The Preface to the Conceptual Framework
3. Financial Statement Discussion and Analysis
4. Reporting on the Long-Term Sustainability of an Entity’s Finances
5. Public Sector Combinations
6. First-Time Adoption of Accrual Basis IPSASs
7. Next Meeting
8. World Congress of Accountants 2014 to be Held in Rome; Sponsorship Opportunities Available



1.     Conceptual Framework ED 4, Presentation in General Purpose Financial Reports

The IPSASB approved the Conceptual Framework–Exposure Draft 4 (CF–ED4), Presentation in General Purpose Financial Reports, which describes presentation, display, and disclosure. It proposes an approach to presentation of decisions involving a two-level application of the concepts developed in chapters 1–4 of the Conceptual Framework.

In finalizing CF–ED4, the IPSASB confirmed:

  • The description of key terminology, including presentation, display, and disclosure; and
  • The decision-focused approach to presentation, involving decisions on information selection, location, and organization.

The IPSASB also confirmed application of both the qualitative characteristics and constraints on information included in general purpose financial reports (GPFRs) when making presentation decisions. The IPSASB also confirmed its decision not to include specific presentation objectives, relying on the direct application of the objectives of financial reporting identified in chapter 2 of the Framework.

The ED will have a four-month exposure period. The ED and the At-a-Glance document, which provides a summary of the ED, will be published shortly.


2.     The Preface to the Conceptual Framework

The IPSASB also discussed the approach to incorporation of the Preface into the Conceptual Framework. While it confirmed that the Preface should be included in the Framework, it decided to defer approval and publication until the Framework is being finalized. This will allow the linkages between the characteristics identified in the Preface and the concepts in the Framework chapters to be made more explicit.

The IPSASB reviewed the draft Preface presented by staff and gave directions for amendments to some of the sections, particularly those dealing with involuntary transfers and non-exchange transactions, and the longevity of the public sector.


3.     Financial Statement Discussion and Analysis

Consistent with a decision earlier in the meeting to issue non-authoritative guidance for pronouncements relating to general purpose financial reports (GPFRs), the IPSASB confirmed that the draft International Public Sector Accounting Standard (IPSAS), Financial Statement Discussion and Analysis, which has been developed from Exposure Draft 47, should be revised to become a Recommended Practice Guideline (RPG).

The IPSASB reviewed the current draft, acknowledging that specific wording may change due to the decision to change its status, and gave directions for amendments. A draft RPG with a Basis for Conclusions will be considered for approval at the June 2013 meeting.


4.     Reporting on the Long-Term Sustainability of an Entity’s Finances

The IPSASB reviewed a draft Recommended Practice Guideline (RPG) 1, Reporting on the Long-Term Sustainability of an Entity’s Finances, which has been developed from Exposure Draft 46 and provided directions for amendments. In particular, it directed staff to revise the section relating to the dimensions of long-term fiscal sustainability to directly refer to the dimensions of service, revenue, and debt and to explain that there are two aspects to each dimension: capacity and vulnerability. Capacity is the ability of the entity to influence or change the service, revenue, or debt dimensions, and vulnerability is the extent of the entity’s dependence on factors outside its control or influence. The draft RPG will be revised and presented at the June 2013 meeting with a view to approval.


5.     Public Sector Combinations

The IPSASB considered the responses received to Consultation Paper (CP), Public Sector Combinations. The CP was issued in June 2012 and received 26 responses.

The IPSASB agreed that the project should continue with the scope proposed in the CP, which includes guidance on (a) the de-recognition and recognition of assets for the transferor, (b) the definition of an operation, (c) disclosure requirements for combining entities relating to the going concern basis, (d) subsequent measurement requirements similar to that included in International Financial Reporting Standard (IFRS) 3, Business Combinations, and (e) distinguishing between asset acquisitions, entity and operation acquisitions, and amalgamations using relevant text from IFRS 3.

The IPSASB had an initial discussion about whether the approach used in the CP of distinguishing acquisitions and amalgamations, with a further distinction for public sector combinations not under common control and under common control, is appropriate. Staff was directed to outline the possible consequences of such distinctions for review at its June 2013 meeting. The IPSASB will also conduct a detailed analysis of the responses to the CP and preliminary views during that meeting.

6.     First-Time Adoption of Accrual Basis IPSASs

The IPSASB discussed an analysis of the transitional provisions related to IPSAS 23, Revenue from Non-Exchange Transactions (Taxes and Transfers), IPSAS 25, Employee Benefits, and IPSAS 32, Service Concession Arrangements: Grantor, and provided directions to staff on various aspects including categorization. The IPSASB agreed to adopt a transition period of three years as a general guideline, acknowledging that this could be changed at the standards level if determined appropriate.

At the June 2013 meeting, an analysis of the transitional provisions for the financial instruments standards will be considered. The IPSASB thanks Ernst & Young for providing staff support up to this point in the project. The South African Accounting Standards Board is now providing staff resources for the project and will be developing an exposure draft for review, with a view to approval in September 2013.


7.     Next Meeting

The next IPSASB meeting will be held in Toronto, Canada, on June 17–20, 2013. Members of the public may register to observe the meetings. Registration will close one week before the first day of the meeting.


8.  World Congress of Accountants 2014 to be Held in Rome; Sponsorship Opportunities Available

The next World Congress of Accountants (WCOA) will be hosted by the Consiglio Nazionale dei Dottori Commercialisti e degli Esperti Contabili (CNDCEC) in Rome, Italy, in 2014. Themed 2020 Vision: Learning from the Past, Building the Future, the 2014 WCOA will be held November 10-13 at the Auditorium Parco della Musica. More than 4,000 professionals from all over the world will convene at this can’t-miss IFAC event, held every four years. WCOA 2014 will look back to explore the evolution of the accountancy profession and forward to showcase the innovations that will set the tone for the future.

The WCOA also affords an unparalleled opportunity for organizations and firms to share their projects and visions with the world by taking advantage of one of our carefully crafted sponsorship packages. There are numerous options so you’ll be able to select the one that best suits your organization’s unique strategy and goals. For more information, please contact info@wcoa2014rome.com or Dimarco@wcoa2014rome.com


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