IFAC Response to International Monetary Fund Consultation: Draft Resource Revenue Management Pillar

Pillar IV – Resource Revenue Management, will complete the IMF Fiscal Transparency Code by stating principles and practices for each stage of the resource revenue management process for resource-rich countries. It recognizes the need to account for differences in the institutional and legal systems which govern natural resource activity in individual countries, and follows the structure and approach of the first three pillars in measuring the transparency and quality of output rather than processes, and in placing greater emphasis on fiscal risk disclosure and management. It also reflects the importance of changes in commodity markets and the structure of the extractive industries in recent years, and takes into account the development of new natural resource transparency standards and initiatives.

IFAC welcomes the proposals in Pillar IV to strengthen obligations on governments to improve transparency for the natural resources they control and the rights and obligations that stem from their exploitation.  In its response, IFAC has highlighted a number of areas where the principles could be strengthened to improve the quality of information reporting by governments on the exploitation of natural resources and the role the accounting profession can play in helping to achieve that end.