The IPSASB is reaching the end of its discussions on revenue and transfer expenses

After extensive deliberations on how to account for revenue and transfer expenses in the public sector, the IPSASB is nearing the end of their process to address stakeholder comment on the Exposure Drafts that were issued in 2020.

Status of discussions

With all the key principles agreed, the IPSASB’s review of the revised text in December 2022 focused on non-authoritative guidance. Stakeholders noted Implementation Guidance and Illustrative Examples will assist with the application of the principles. The basis for conclusions of both IPSASs on revenue and transfer expenses was considered for the first time by the IPSASB and is key in communicating the IPSASB’s reasons for decisions to stakeholders.

What is next?

The IPSASB will review the complete text of the IPSASs in March 2023 and will ensure the consequential amendments to other IPSASs is complete and appropriate.

A key step in the IPSASB’s due process before a pronouncement is approved is to consider whether it is necessary to re-expose the pronouncement. The need to re-expose is assessed based on a number of factors, including the extent to which changes have been made to the pronouncement since its initial exposure, whether new principles are introduced, and whether the changes respond directly to comment received.

An important part of the March 2023 meeting will be for the IPSASB to consider separately whether it is necessary to re-expose the IPSASs on revenue and transfer expenses. Given the extent of changes made to the principles that were exposed for comment, there is an expectation from stakeholders that re-exposure is likely especially on transfer expenses. If the conclusion on either IPSAS is that re-exposure is unnecessary, the IPSASB will vote to approve as final IPSASs.

What is the impact locally?

There are no immediate changes to the requirements of the Standards of GRAP as a result of the IPSASB’s ongoing projects on revenue and transfer expenses. The Board will start a local project on transfer expenses in the next work programme cycle if possible (access the ASB’s next work programme here).

The Secretariat of the ASB will continue to inform stakeholders of the status of IPSASB projects and guidance. Should one or both of the Exposure Drafts be re-exposed, the Secretariat will engage with local stakeholders to develop comments to the IPSASB.