What are the key differences between IFRS and IPSAS?
IPSAS differentiate between acquisition and amalgamations; IFRS only considers acquisitions. Whilst it is important to understand and acknowledge the differences, alignment between IPSAS and IFRS should be encouraged wherever possible.
What is the relationship between IPSAS and IFRS?
IPSAS are based on the International Financial Reporting Standards (IFRS), formerly known as IAS. IFRS are issued by the International Accounting Standards Board (IASB). IPSASB adapts IFRS to a public sector context when appropriate.
What is IPSAS accrual basis of accounting?
Accrual Basis IPSAS requires an entity to prepare and present financial statements which include the following components: Statement of financial position. Statement of financial performance. Statement of changes in net assets/equity.
Is accrual accounting allowed under IFRS?
Accrual cash accounting Both are acceptable within IFRS (International Financial Reporting Standards). The major difference between the methods is when revenues and expenses are recognized. Using the cash method, revenue is recorded when money comes in and expenses are recorded when they are paid.
What is the difference between IAS 1 and IPSAS 1?
IAS 1 uses the term income, which is not used in IPSAS 1. IPSAS 1 uses revenue, which corresponds to income in the IASs/IFRSs. The term income is broader than revenue, encompassing gains in addition to revenue.
What are the components of IPSAS?
A complete set of financial statements comprises:
What is Ipsas cash basis?
The Cash Basis IPSAS prescribes the manner in which general purpose financial statements should be presented using the cash basis of accounting. Information about the cash receipts, cash payments and cash balances of an entity is necessary for accountability purposes.
What’s the difference between accrual basis and cash basis?
Cash accounting reflects business transactions on a company’s financial statements when the cash flows into or out of the business. Accrual accounting recognizes revenue when it’s earned and expenses when they’re incurred, regardless of when money actually changes hands.
Is cash basis allowed under IFRS?
Cash basis accounting is not acceptable under the generally Acceptable Accounting Principles (GAAP) or the International Financial Reporting Standards (IFRS).
What are the key features of IPSAS 1?
IPSAS 1 specifies minimum line items to be presented on the face of the statement of financial position, statement of financial performance, and statement of changes in net assets/equity, and includes guidance for identifying additional line items, headings, and subtotals.
Is IAS 1 and IFRS 1 the same in content?
IAS 1 Presentation of Financial Statements represents a basis of the whole IFRS reporting, as it sets overall requirements for the presentation of financial statements, guidelines for their structure and minimum requirements for their content.
Are your financial statements compliant with accrual basis IPSAS?
Financial statements may be described as complying with Accrual Basis IPSAS if they comply with all the relevant requirements and if they include additional disclosures when necessary to achieve a fair presentation. Here is an illustrative example of financial statements prepared by applying Accrual Basis IPSAS.
What are the international standards for accrual accounting?
Many jurisdictions that are already applying accrual accounting have based their accounting framework on either International Financial Reporting Standards (IFRS) or International Public Sector Accounting Standards (IPSAS) and adapting them to suit their specific needs.
Is IFRS the only credible international accounting standard?
Some jurisdictions have been applying accrual accounting for a long time and IFRS were viewed as the only credible international accounting standards (see Appendix 1 for UK’s journey to IFRS adoption).
Does IFRS apply to combinations under common control?
Accounting for combinations under common control is outside the scope of IFRS. IPSAS recognise that this is a common transaction in the public sector and have adopted the pooling of interest method (merger accounting). IPSAS differentiate between acquisition and amalgamations; IFRS only considers acquisitions.