IPSASB eNews: March 2018

2018-04-03 - 09:36

The IPSASB held its first meeting of the year from March 6-9, 2018 in New York City, USA.

Revenue

The IPSASB discussed responses to the Consultation Paper (CP), Accounting for Revenue and Non-Exchange Expenses. For Revenue, the IPSASB agreed that a converged IFRS 15, Revenue from Contracts with Customers, should be developed to replace IPSAS 9, Revenue from Exchange Transactions, and IPSAS 11, Construction Contracts. It was also decided that IPSAS 23, Revenue from Non-Exchange Transactions (Tax and Transfers), should be revised. 

Staff will also further develop the Public Sector Performance Obligation Approach for discussion at the June 2018 meeting. Accounting for capital grants and services in-kind was also discussed. 

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 Non-Exchange Expenses

The IPSASB discussed responses to the IPSASB’s preliminary views on non-exchange expenses in the Revenue and Non-Exchange Expenses CP, and noted the views on interactions with other projects. The IPSASB directed staff to further develop key definitions, as well as the Public Sector Performance Obligation Approach from an expenses perspective, for consideration at the next meeting.

Staff presented the responses to the proposals on non-contractual receivables and payables. The IPSASB agreed to discuss these again when further progress has been made on other issues.

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Social Benefits

Staff presented on Exposure Draft (ED) 63, Social Benefits, highlighting key issues that are expected to be relevant to the Non-Exchange Expenses project. The IPSASB noted in particular that the definitions of social benefits, universally accessible services and collective services were critical and would need to be discussed at the June meeting.

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Improvements

The IPSASB approved ED 65, Improvements to IPSAS, 2018, which includes both IPSAS-specific improvements as well as others to maintain convergence with IFRS. This latter group draws on the IASB’s recent improvements and narrow scope amendment projects as well as recent IFRICs.

A second ED incorporating IASB amendments related to IFRS 9 was also approved and will be issued once the IPSASB’s new Financial Instrumentsstandard is issued.

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Public Sector Measurement

The IPSASB reviewed draft wording for several sections of the ED, Measurement, and the first three chapters of the CP, Public Sector Measurement. The IPSASB formed a preliminary view that borrowing costs related to the acquisition, construction, or production of qualifying assets should be expensed. 

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Core Financial Instruments

The IPSASB reviewed responses to ED 62, Financial Instruments, and respondents strongly supported the principles in the ED on classification, impairment and hedging. Respondents primarily requested further clarity on the application of these principles to complex transactions. 

The IPSASB agreed that the Financial Instruments Task Force should consider the issues raised by respondents and propose changes, where appropriate, to the draft standard. The Task Force’s recommendations will be considered at the June IPSASB meeting.

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Public Sector Financial Instruments

The IPSASB agreed upon the approach to develop practical guidance and to align guidance as closely as possible with the IPSASB’s core Financial Instrumentsstandards.

The IPSASB agreed that the Financial Instruments Task Force should consider how and where to address public sector specific topics – monetary gold, currency in circulation, International Monetary Fund (IMF) quota subscriptions and IMF special drawing rights – and make recommendations at the December IPSASB meeting. 
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