Objective of the IPSASB

The objectives of the IPSASB are to serve the public interest by developing high quality public sector financial reporting standards and by facilitating the convergence of international and national standards, thereby enhancing the quality and uniformity of financial reporting throughout the world.

The IPSASB achieves its objectives by

1. Issuing international public sector accounting standards (IPSASs);
2. Promoting the acceptance and the international convergence to these standards;
3. Publishing other documents which provide guidance on issues and experience in financial reporting in the public sector.
4. Issues non-authoritative publications including studies, research reports and occasional papers that deal with particular public sector financial reporting issues.

Read Also: INTERNATIONAL PUBLIC SECTOR ACCOUNTING STANDARDS (IPSAS)

Nature of the IPSASs

IPASB provides countries with the option to adopt either cash basis or accrual basis of financial reporting depending on the specific needs and systems of financial operation in place for the government or the countries in question.

For this reason, the IPSASB has developed IPSASs bases on two main accounting basis, Cash basis standards and the accrual basis standards

Cash based standards

The cash basis allowed providers of eternal assistance (especially development assistance) to follow a variety of accounting practices applied by the receivers of the fund. Hence most recipients of external assistance maintain their accounts on the cash basis of accounting hence, the development of a cash standard.

The IPSASB however encourages governments to progress to the accrual basis of accounting and to harmonize national requirements with the IPSASs.

The IPSAS financial reporting under the cash basis of accounting is in two parts, the first part addresses mandatory reporting requirement and the second part identities additional accounting policies and disclosures that an entity is encouraged to adopt to enhance its financial accountability and the transparency of its financial statements.

The standard encourages an entity to voluntarily disclose accrual-based information. An entity in the process of moving from cash accounting to accrual accounting may wish to include particular accrual-based disclosures in the process of transition.

Accrual based standards

The accrual basis IPSAS is based on the accrual principles which is in line with internal financial reporting standards (IFRS). As at the time of compelling this guide there were 32  accrual basis IPSASs and these are as follows;