Ipsasb

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In This Issue:

1. Outcomes of February and May 2009 IPSASB Meetings
2. IPSASB Proposes New Requirements on Reporting of Financial Instruments
3. New Guidance Strengthens Reporting of Intangible Assets and Entity Combinations
4. IPSASB and IMF Continue Strong Partnership
5. Review Launched into Cash Basis IPSAS
6. IPSASB Releases 2009 IPSAS Handbook; French and Spanish Translations of 2007 Handbook
7. IPSASB 2009 Meeting Dates 
8. Share IPSASB eNews with Your Colleagues

1.  Outcomes of February and May 2009 IPSASB Meetings

Meeting Highlights from the IPSASB's February meeting in Paris, France are now available in English, French, and Spanish. The Meeting Highlights from the May IPSASB meeting in Washington, DC will be available shortly. At the past two meetings, the IPSASB discussed the following topics, among others:

  • Convergence with International Financial Reporting Standards (IFRSs) - Consistent with its strategy to substantially converge International Public Sector Accounting Standards (IPSASs) at December 31, 2009 with IFRSs issued by December 31, 2008, the IPSASB has approved six Exposure Drafts (EDs). These include three EDs on Financial Instruments (see item 2 below for details), ED 36 on Agriculture, and EDs 40 and 41 on Intangible Assets and Entity Combinations from Exchange Transactions.
  • Conceptual Framework - The IPSASB has started its review of the 55 responses received to the Phase 1 Consultation Paper and continues to consider and develop positions on the subsequent phases dealing with definition and recognition of elements and measurement. Work will continue on all phases of the Conceptual Framework throughout the remainder of 2009.
  • Long-Term Fiscal Sustainability - The IPSASB has been discussing a draft Consultation Paper that is being developed and anticipates approving this in September 2009.
  • Service Concession Arrangements (SCAs) - The IPSASB is developing an ED for approval by the end of 2009 that uses a control-based approach for asset recognition by public sector grantors. The principles of the proposed ED will be consistent with the Consultation Paper on SCAs that was issued in March 2008.
  • Cash Basis Review - See item 5 below for details.

Meeting Highlights and background papers of all past IPSASB meetings can be viewed at http://www.ifac.org/PublicSector/Meetings.php.

2.   IPSASB Proposes New Requirements on Reporting of Financial Instruments

The IPSASB has proposed new financial reporting requirements to assist public sector entities in accounting for financial instruments, such as derivatives, bonds, and loans. Public sector reporting of these instruments has become important due to the unprecedented scale of government intervention in the financial sector.

These new requirements are contained in three new exposure drafts (EDs):

  • ED 37, Financial Instruments: Presentation;
  • ED 38, Financial Instruments: Recognition and Measurement; and
  • ED 39, Financial Instruments: Disclosures.

The three EDs propose IPSASs that converge with the International Accounting Standards Board's standards for financial instruments as at Dec. 31, 2008, with limited changes.

While the intention of the International Accounting Standards Board (IASB) is to modify aspects of its current standards relating to the measurement of financial instruments, the IPSASB will nonetheless continue its full consultation on the exposure drafts and consider any changes ultimately adopted by the IASB in due course. The IPSASB believes the public sector and its constituents are best served by having International Public Sector Accounting Standards (IPSASs) on financial instruments and removing reliance on the hierarchy at this time. The IPSASB strategy will provide stability for users and allow the IPSASB to manage the current period of uncertainty. The current global financial crisis underlines the importance of consistent financial reporting by governments of their exposures to financial instruments.

The EDs may be viewed by going to www.ifac.org/EDs. Comments are requested by July 31, 2009 and may be submitted electronically by registering online at www.ifac.org. To register, click on the Login/Register link located in the website's left-hand navigation. Comments are still being accepted by email to EDComments@ifac.org or stepheniefox@ifac.org.

3.  New Guidance Strengthens Reporting of Intangible Assets and Entity Combinations

The IPSASB has proposed new guidance to address the accounting for intangible assets and entity combinations. Both subject areas are growing increasingly important for public sector entities as the financial crisis forces more governments to acquire businesses that would otherwise have been liquidated.

To ensure that these transactions are reported in a consistent and transparent manner, the IPSASB has released for comment the following exposure drafts (EDs):

  • ED 40, Intangible Assets; and
  • ED 41, Entity Combinations from Exchange Transactions.

ED 40 proposes an IPSAS that converges with the International Accounting Standards Board's (IASB) International Accounting Standard 38, Intangible Assets. It also incorporates guidance on website costs and intangible heritage assets. Meanwhile, ED 41 is converged with the IASB's International Financial Reporting Standard 3, Business Combinations because it addressed entity combinations that are similar in nature to those in the private sector.

The EDs may be viewed by going to www.ifac.org/EDs. Comments are requested by August 15, 2009 and may be submitted electronically by registering online at www.ifac.org. To register, click on the Login/Register link located in the website's left-hand navigation. Comments are still being accepted by email to EDComments@ifac.org or stepheniefox@ifac.org.

4. IPSASB and IMF Continue Strong Partnership

The IPSASB's May 2009 meeting was held at the offices of the International Monetary Fund (IMF) in Washington DC, recognizing the strong participation of IMF observers to the IPSASB's ongoing deliberations.

The IPSASB meeting opened with a speech by Mr. Murilo Portugal, Deputy Managing Director of the IMF. The transcript of this speech is available at:

http://www.imf.org/external/np/speeches/2009/051809a.htm

In addition, two senior officials with IMF provided commentary to the IPSASB on the global financial crisis and its impact on governments.

The IPSASB and the IMF have formed a joint task force to learn about various government interventions in response to the global financial crisis and the application of accounting standards for reporting government actions.

5. Review Launched into Cash Basis IPSAS

The IPSASB has established a Task Force to undertake a review of the International Public Sector Accounting Standard (IPSAS), Financial Reporting under the Cash Basis of Accounting. The purpose of the review is to determine whether the IPSAS should be modified or if further guidance should be provided by the IPSASB.

As part of the review process, the IPSASB is asking those who have been involved in the adoption of the Cash Basis IPSAS in developing economies to complete a questionnaire on their experiences with respect to implementation issues. Please see the invitation letter for a full explanation of the review process.

The materials are available in English, Spanish, and French and can be downloaded from the IPSASB website at www.ifac.org/PublicSector/Projects.php#InProgress.

Responses are invited by July 15, 2009 from interested parties, including Ministers of Finance and heads of finance departments or their equivalents, users of financial reports, advisors, and other relevant financial management and similar experts, including members of the international and national aid agencies.

6.  IPSASB Releases 2009 IPSAS Handbook; French and Spanish Translations of 2007 Handbook

The IPSASB has published the 2009 Handbook of International Public Sector Accounting Pronouncements.

The updated handbook contains all pronouncements of the IPSASB as of December 31, 2008, as well as the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants. It also includes editorial corrections identified since the publication of the 2008 handbook, and amendments to the Code of Ethics.

The handbook can be downloaded free of charge in PDF format from the IFAC online bookstore (www.ifac.org/store). Print copies are also available for shipment.

The IPSASB has also published French-language and Spanish-language translations of its 2007 Handbook of International Public Sector Accounting Pronouncements.

These editions contain translations of 24 accrual basis IPSASs and the comprehensive cash basis IPSAS. They revise the translation of the 2005 Handbook, with key changes including three additional IPSASs and revised versions of eleven other IPSASs.

The French and Spanish handbooks can be downloaded free of charge in PDF format from the IFAC online bookstore (www.ifac.org/store). Print copies are also available for shipment.

7.  IPSASB 2009 Meeting Dates

In order to meet its strategic goal of International Financial Reporting Standard convergence by December 31, 2009, the IPSASB has added a fourth meeting in 2009 to allow it to finalize the IPSASs based on EDs 36-41 inclusive. Remaining 2009 meeting dates are as follows:

  • September 8-11 in Toronto, Canada (replacing the October meeting); and
  • December 8-11 in Rome, Italy.

8. Share IPSASB eNews with Your Colleagues

The IPSASB issues regular eNews updates to keep you current on its activities and recent publications. Please forward this eNews to any interested colleagues and advise them to subscribe to IPSASB eNews by following these simple steps:

1. Go to the eNews sign-up page at http://www.ifac.org/E-news/index.tmpl.
2. Enter your email address, name, and country.
3. Select "Public Sector eNews" from the check list as well as any other eNews alerts that you would like to receive.

You will receive the next issue of the IPSASB eNews directly into your inbox.

For more information about any of the items mentioned above or other information about the IPSASB, please contact: communications@ifac.org or visit the IPSASB's home page at www.ipsasb.org.

About IFAC
IFAC is the global organization for the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. IFAC is comprised of 157 members and associates in 123 countries, representing more than 2.5 million accountants in public practice, education, government service, industry, and commerce. In addition to setting international public sector financial reporting standards through the IPSASB, IFAC, through its independent standard-setting boards, sets ethics, auditing and assurance, and education standards. It also issues guidance to encourage high-quality performance by professional accountants in business.