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IPSASB Issues Two Exposure Drafts Related to Natural Resources Project

Jan 31, 2024 | New York, New York | English

Tangible natural resources are generally understood to be resources such as mineral resources, water, and living organisms that are naturally occurring. They account for a significant proportion of the economic resources in many jurisdictions. However, governments often lack sufficient information on the monetary value of natural resources, and as a result, grant rights to these resources without regard to financial and environmental sustainability, or intergenerational fairness.

To address the gap in the IPSAS literature on accounting for natural resources, the International Public Sector Accounting Standards Board® (IPSASB®) issued a Consultation Paper (CP) in May 2022. The IPSASB continues to develop principles for the recognition and measurement of natural resources, with the targeted publication of an Exposure Draft (ED) in the second half of 2024. However, following feedback received on the CP concerning the lack of guidance on specific activities related to mineral resources, this is being addressed first with the release of ED 86 and ED 87 for public comment:

ED 86 proposes a standard on accounting for the costs incurred in the exploration and evaluation of mineral resources, based on the selection of an accounting policy specifying which expenditure should be recognized as exploration and evaluation assets. ED 86 is aligned with the private sector requirements in IFRS 6, Exploration for and Evaluation of Mineral Resources, with limited changes for the public sector context.

ED 87 proposes adding an authoritative appendix to IPSAS 12, Inventories. The proposed guidance clarifies when to capitalize or expense costs incurred to remove waste material in surface mining operations. ED 87 is aligned with the guidance in IFRIC 20, Stripping costs in the Production Phase of a Surface Mine, with limited changes for the public sector context.

“As the IPSASB’s broader Natural Resources project continues to break new ground, the current proposals address some of the gaps in the literature on mineral resources in response to stakeholders needs,” said IPSASB Chair Ian Carruthers. “There is more to come in 2024 from the Natural Resources project, but these EDs are an important first step to providing useful financial information and improved accountability by the public sector in this important area.”

How to Comment

To access the EDs and the summary At-a-Glance documents, or to submit a comment, visit the IPSASB website, Comments on the EDs are requested by May 31, 2024. The IPSASB encourages IFAC® members, associates, and regional accountancy organizations to promote the availability of these EDs to their members and employees.

About the IPSASB 

The International Public Sector Accounting Standards Board (IPSASB) works to strengthen public financial management globally through developing and maintaining accrual-based International Public Sector Accounting Standards® (IPSAS®) and other high-quality financial reporting guidance for use by governments and other public sector entities. It also raises awareness of IPSAS and the benefits of accrual adoption. The Board receives support from the Asian Development Bank, the Chartered Professional Accountants of Canada, the New Zealand External Reporting Board, and the government of Canada. The structures and processes that support the operations of the IPSASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact

About the Public Interest Committee 

The governance and standard-setting activities of the IPSASB are overseen by the Public Interest Committee (PIC), to ensure that they follow due process and reflect the public interest. The PIC is comprised of individuals with expertise in public sector or financial reporting, and professional engagement in organizations that have an interest in promoting high-quality and internationally comparable financial information.