The International Public Sector Accounting Standards Board (IPSASB) today released for comment a Consultation Paper (CP), Public Sector Specific Financial Instruments.

International Public Sector Accounting Standards™ do not currently provide guidance on how to account for a number of monetary items that the IPSASB has termed “public sector specific financial instruments.” The lack of guidance leads to reporting that is inconsistent between entities and, as a result, users may not have the information they need for accountability and decision-making purposes.

“For entities responsible for public sector financial instruments, the topics in this Consultation Paper are critically important because users need better information to evaluate the impact of these significant items on government finances,” said IPSASB Chair Ian Carruthers. “This Consultation Paper is the first step in developing consistent financial reporting for public sector specific financial instruments. We look forward to receiving constituents’ views on the accounting approaches identified for each topic.”

The CP includes three main topics related to accounting for public sector financial instruments:

• Currency in Circulation. The CP considers currency in circulation by reference to the definitions of the elements of a liability and revenue in The Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities (the Conceptual Framework). The key issue is whether the issuance of currency gives rise to a present obligation, with two accounting approaches proposed, which depends on whether a liability should be recognized and, if not, alternatives for recognizing revenue.
• Monetary Gold. The CP considers which gold assets meet the proposed definition of monetary gold and the appropriate measurement bases for initial and subsequent measurement of such assets. Two accounting approaches are proposed for monetary gold, each linked to the intention of a monetary authority in holding such assets:
• Approach 1—Measurement at market value linked to an intention to hold gold because it can be traded in the global liquid markets; and
• Approach 2—Measurement at historical cost when the intention is to hold gold for an indeterminate period of time to support economic stability.
• International Monetary Fund (IMF) Quota Subscription and Special Drawing Rights (SDRs). The CP is informed by the Conceptual Framework, and puts forward the IPSASB’s view of the appropriate recognition and measurement of the IMF Quota Subscription, SDR holdings, and SDR allocations.

How to Comment

To access the Consultation Paper and the At-a-Glance document, which provides a summary of the Consultation Paper, or to submit a comment, please visit the IPSASB website at www.ipsasb.org/. Comments on the Consultation Paper are requested by December 31, 2016. The IPSASB encourages IFAC members, associates, and regional accountancy bodies to promote the availability of this Consultation Paper to their members and employees.

About the IPSASB
The IPSASB develops accounting standards and guidance for use by public sector entities. It receives support (both direct financial and in-kind) from the Government Accounting Standards Board, the Asian Development Bank, the Chartered Professional Accountants of Canada, the South African Accounting Standards Board, the New Zealand External Reporting Board, and the governments of Canada, New Zealand, and Switzerland.

About the Public Interest Committee
The governance and standard-setting activities of the IPSASB are overseen by the Public Interest Committee (PIC) to ensure that they follow due process and reflect the public interest. The PIC is comprised of individuals with expertise in public sector or financial reporting and professional engagement in organizations that have an interest in promoting high-quality and internationally comparable financial information.

About IFAC
The International Federation of Accountants^® (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 more than 175 members and associates in more than 130 countries and jurisdictions, representing almost 3 million accountants in public practice, education, government service, industry, and commerce.

The International Auditing and Assurance Standards Board (IAASB) today released a survey consultation, The IAASB’s Work Plan for 2017‒2018 and Continuing Relevance of Its Strategic Objectives. Feedback to this consultation will assist the board in evaluating its priorities for 2017–2018 and allocating its resources—a full-time Chairman supported by a 17-person volunteer board and ten-person technical staff—in the best way possible.

“Our extensive outreach and consultation, most recently through our Invitation to Comment, leads us to believe we are already addressing the most pertinent topics in the public interest. We are prioritizing standard setting in relation to the fundamental topics of accounting estimates, professional skepticism, quality control, risk assessment, and group audits—while at the same time actively debating the implications for practitioners of developments in data analytics, integrated reporting, and emerging forms of external reporting,” explained Prof. Arnold Schilder, IAASB Chairman. “At the same time, we recognize we will soon be at the mid-point of our five-year strategy, so it is helpful to pause and reflect with our stakeholders about whether anything in the external environment indicates a need to change course or re-prioritize.”

The IAASB and its Consultative Advisory Group have considered a number of other topics that could warrant IAASB attention, which are highlighted in the survey. Respondents are asked for their views on how topics should be prioritized, recognizing that much of the board’s current standard-setting efforts will carry on into 2017 and beyond unless the IAASB decides to modify its current work plan. The IAASB would also like to understand whether its current strategic initiatives remain appropriate given its mandate.

“We look forward to hearing from a wide range of our stakeholders, and hope that by using a survey, we will hear from many around the world,” Kathleen Healy, IAASB Technical Director, noted. “We have designed the survey to allow respondents to quickly flag key priorities or, alternatively, tell us when certain topics are less relevant—as this will be helpful in deciding whether our focus should change from any of our current priorities to those that might be deemed more relevant from a public interest perspective.”

The survey will be open for responses through September 30, 2016, and must be submitted using the online tool. A PDF version of the survey has been provided to assist organizations that may need to consult internally in preparing their response before submitting it electronically.

About the IAASB
The IAASB develops auditing and assurance standards and guidance for use by all professional accountants under a shared standard-setting process involving the Public Interest Oversight Board, which oversees the activities of the IAASB, and the IAASB Consultative Advisory Group, which provides public interest input into the development of the standards and guidance. The structures and processes that support the operations of the IAASB are facilitated by the International Federation of Accountants (IFAC). For copyright, trademark, and permissions information, please go to permissions or contact permissions@ifac.org.

Almost a decade after the global financial crisis, more than 50 thought leaders from across the public, private, and academic communities called for balanced regulation targeted to specific social outcomes, as well as stronger checks and balances, such as sunset clauses or impact analyses, to measure regulation’s effectiveness and fitness for purpose.

Speaking from the floor during the discussion, Fayez Choudhury, IFAC Chief Executive Officer, noted that, “There is a critical need to review and evaluate regulations on an ongoing basis, and to ensure purpose-built regulation going forward, in order to strengthen the global economy and financial system.”

The group emphasized that—while governments acted decisively and much has been achieved since the crisis—regulation alone cannot solve problems. It must be partnered with stronger corporate governance, and embedding ethics and values in organizations from the top down. These are essential to restore the public’s trust in government and both the public and private sector, which continues to be a vital goal.

“How can we ensure a duty of care to markets and society?” asked roundtable participant Baroness Sharon Bowles. “If you get corporate governance right, it can eliminate the need to regulate every eventuality—the corporate governance space is as important as the regulatory space. And the professions that advise businesses play an important role.”

The current compliance culture, participants said, has replaced responsibility and professionalism with rule-following and “box ticking.” In addition, this culture can lead to overreaction and risk aversion, stifling risk-taking that is essential for entrepreneurialism and growth.

ICAEW Chief Executive Michael Izza said, “We all agree that getting the future of regulation right is vital for the global economy. Regulation must be proportionate. We need to avoid on the one hand growing to a scale where compliance is so complex and costly it is a barrier to all but the largest firms, and on the other obsessive simplicity to the extent that it no longer protects against systemic failure. It will be important for everyone to work together and innovate to find the best solutions.”

The group noted that many responses to the financial crisis were fundamentally national and fragmented, whereas business is increasingly global. Participants called for more coordinated rules and consistent implementation, in line with calls from the G-20 and other global organizations since 2009.

Additional points of consensus from the roundtable included the importance of proportionality to protect small- and medium-sized entities—an engine of global economic growth—from over-regulation and the need for enhanced dialogue across the stakeholder spectrum.

Organized by the International Federation of Accountants^® (IFAC^®) and the Institute of Chartered Accountants in England and Wales (ICAEW), the roundtable included senior executives and experts from regulatory agencies, financial markets, government, academia, listed companies, investment funds, and the accounting profession.

The roundtable follows a similar meeting in Hong Kong in December 2015, at which 30 senior representatives of the regulatory, government, professional, investor, business, and academic communities identified ten principles to help guide regulators toward better decisions and protect the global economy from the dangers posed by a patchwork approach to regulation. Previously, IFAC issued a discussion paper, From Crisis to Confidence: the Role of Good Regulation, which examined the impact, benefits, and costs of the current regulatory landscape, and compares internationally recognized principles of good regulation.

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. It is comprised of more than 175 members and associates in more than 130 countries and jurisdictions, representing almost 3 million accountants in public practice, education, government service, industry, and commerce.