IPSASB Member Executive Director Policy and Technical CIPFA Conceptual Framework October 2014 Strategy and Work Plan 20152019 First Time Adoption IPSAS 33 January 2015 Accounting for Interests in Other Entities ID: 1042661
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1. IPSASB DevelopmentsIan CarruthersIPSASB MemberExecutive Director, Policy and Technical, CIPFA
2. Conceptual Framework – October 2014Strategy and Work Plan 2015-2019First Time Adoption (IPSAS 33) – January 2015Accounting for Interests in Other Entities (IPSASs 34 – 38) – January 2015RPG3 - Service Performance Reporting – March 2015IPSASB Developments
3. CF Preface: Characteristics of the Public Sector
4. CF Chapter 1:Role and Authority of the Conceptual Framework
5. Objectives of Financial ReportingProvide information about entity useful to users of GPFRs Accountability purposes and decision-making purposes Reflects service delivery objective and nature of fundingRespond to information needs of usersUsers of GPFRsPrimary users: service recipients and resource providersCF Chapter 2:Objectives and Users
6. CF Chapter 3:The QCs
7. Government or other public sector organisation, program or identifiable area of activity that prepares GPFRsKey characteristics Raises or uses resources from / on behalf of constituents; andService recipients or resource providers dependent on GPFRsMay comprise two or more separate units / organisationsSeparate legal identity not essentialCF Chapter 4:The Reporting Entity
8. CF Chapter 5:Defined Elements
9. Recognition of economic phenomena not captured by elements definitions potentially necessaryIPSASs could require or allow recognition of resources or obligations not satisfying element definitions:‘other resources’ (deferred inflows at ED stage)‘other obligations’ (deferred outflows at ED stage)Net financial position instead of Net Assets= difference between assets and liabilities after adding other resources and deducting other obligations.CF Chapter 5:Net Financial Position / Other Economic Phenomena
10. CF Chapter 6:Recognition – The Criteria
11. Measurement Objective: ‘to select those measurement bases that most fairly reflect the cost of services, operational capacity and financial capacity of the entity in a manner that is useful in holding the entity to account, and for decision-making purposes’No single measurement basis (or group of bases) identified Asset Liability Historical CostCurrent ValueMarket valueCost of fulfillmentReplacement costMarket valueNet selling priceCost of releaseValue in useAssumption priceCF Chapter 7:Measurement
12. CF Chapter 8:Presentation
13. IPSASBIASBRoleConcepts that underpin general purpose financial reporting; does not override standardsConcepts that underlie the preparation and presentation of financial statements; does not override standardsScopeGeneral purpose financial reports (GPFRs)1989 Framework – relates to financial statements – 2010 Framework sections refer to GPFRsObjective Financial information - useful for accountability and decision-making purposes. Users service recipients and resource providersFinancial information - to provide investors, lenders and other creditors making decisions about providing resources to the entityQualitative CharacteristicsDefinitions very similar to IASB Framework; no split between fundamental and enhancing characteristicsSplit between fundamental and enhancing characteristicsElementsDefinitions similarNet financial position & “other economic phenomena”Definitions similar; tentative decisions on “economic resources”MeasurementMeasurement objective“Fair Value” not identified as measurement basis. Tentative decision – no measurement objective (factors to consider when selecting a measurement basis)ReportingIPSASB principles for information selection, location and organisation in broader GPFRsDiscussion paper and exposure draft has/is anticipated to include a new chapter on presentation and disclosureIPSASB CF Compared to the IASB
14. Strengthening public financial management and knowledge globally through increasing adoption of accrual-based IPSASs by:Developing high-quality public sector financial reporting standards;Developing other publications for the public sector; andRaising awareness of the IPSASs and the benefits of their adoption.IPSASB Strategic Objective 2015
15. Public Sector Combinations Government Business Enterprises Public Sector Specific Financial InstrumentsEmissions Trading Schemes – collaboration with IASBSocial Benefits – project re-started Ongoing projects
16. Work Plan 2015-2019Balancing development and maintenance
17. In January 2015 the IPSASB issued:IPSAS 34 Separate Financial Statements IPSAS 35 Consolidated Financial StatementsIPSAS 36 Investments in Associates and Joint VenturesIPSAS 37 Joint ArrangementsIPSAS 38 Disclosure of Interests in Other EntitiesFeatures: Based on IFRS equivalentsDifferent terminology, including relevant public sector illustrationsClarifications on the applicability of the Standards to accounting by public sector entities. Accounting for Interests in Other Entities
18. Questions Discussion & Further InformationVisit our webpage http://www.ipsasb.org/ Or contact us by e-mail:Chair IPSASB: andreasbergmann@ipsasb.orgTechnical Director: stepheniefox@ipsasb.org