IPSAS - For Revenues (1 day)

Introduction

This one-day course provides an overview of the most important requirements for accounting for revenues under IPSAS. It focuses upon the application of IPSAS 23 Revenue from Non-exchange Transactions, where it considers issues relevant to recognition of taxes by government entities and the receipt and grant of donated goods and services, including assessed contributions, program and voluntary funds by other public bodies. Other areas covered include concessionary loans, the impact of principal or agent status on the recognition of revenues and expenses, IPSAS 9 Revenue from Exchange Transactions and IPSAS 11 Construction Contracts. The course also considers sources of guidance for recognition of expenses from non-exchange transactions, for example, by providers of grants and donated goods and services.

The IPSAS accounting, financial reporting and disclosure requirements are explained in clear, simple language and illustrated with model financial statements and real-world examples. Application of the various applicable standards is illustrated through the use of short case studies.

In addition to a review of the current Standards, the course introduces the IPSASB’s three Exposure Drafts published in February 2020. ED 70 and ED 71 respectively propose replacing IPSAS 9 and amending IPSAS 23. ED 72 aims to develop a new Standard dealing with recognition and measurement of transfer (non-exchange) expenses.

Following extensive redeliberation, the IPSASB expects to approve two new standards on revenue and transfer expenses in 2023. It is expected that, as these include substantial changes to EDs 70, 71 and 72, the Board will decide to re-expose the amended proposals. No date for implementation has been decided.  

This program answers questions such as:

• What are the current requirements for presentation of accrual-basis IPSAS financial statements and related disclosures in terms of revenue?
• What revenue and expense recognition challenges have been observed within public sector entities that have adopted IPSAS?
• What disclosures are made by public sector entities that have adopted IPSAS in regards to revenues and expenses?
• What is the difference between exchange and non-exchange revenue?
• Where can guidance for unique revenue recognition situations be found?
• What guidance is there to draw on to distinguish between revenue generated as a principal and revenue generated as an agent?
• What guidance is available on expense recognition in IPSAS?
• What upcoming changes are anticipated in accounting for revenue and transfer expenses?

Learning Objectives

• Understand accrual-basis IPSAS requirements, including accounting policy requirements and disclosures with a focus on revenues
• Implement the IPSAS recognition and measurement rules for revenues
• Plan ahead for issues that arise when transitioning from the cash basis to the accrual basis of accounting pertaining to revenues
• Understand the key challenges of IPSAS compliant financial reporting on revenues
• Understand how other public sector entities are reporting and disclosing revenues
• Increase planning opportunities through awareness of proposed IPSAS changes
• Learn the sources of IPSAS guidance that are available

Who Should Attend

Individuals with interests in or responsibilities for revenue accounting in the public sector including:

• Staff of central government treasury departments, tax collection departments for central and local government and related agencies
• Finance and accounting managers
• Staff with credit control responsibilities
• Officers with responsibility for managing and collecting grant and programme income
• Government officials and project managers responsible for IPSAS transition
• Accountants and finance staff of entities in the process of adopting IPSAS
• Auditors of entities that have adopted IPSAS or are in the process of doing so
• Accounting academics

Topics

• Introduction to IPSAS
  • The IPSASB Conceptual Framework and its core definitions in relation to revenue and non-exchange expenditure
• IPSAS 23 Revenue from Non-Exchange Transactions (Taxes and Transfers)
  • Nature of non-exchange transactions and scope of standard
  • Distinguishing contributions direct to net assets from revenue transactions
  • Transactions that include both exchange and non-exchange elements
  • General principles; when to recognise assets in relation to non-exchange revenues and should the credit entry be recognised as a liability or revenue?
  • Distinguishing between restrictions and conditions; practical applications
  • Recognition and measurement of tax revenue; practical applications
  • Recognition of revenue from specific types of transfers
  • Recognition of donated services; distinguishing services receivable from goods, whether or not to recognise them
  • Recognition of concessionary loans and waivers; interaction with IPSAS 29
  • Required presentation and disclosure of non-exchange revenue
  • Optional transitional requirements for first time adopters
  • Subsequent collectability of receivables, interaction with IPSAS 29, impairment
  • Relevance of IAS 20 Government Grantsto public entities reporting under IPSAS
• IPSAS 9 Revenue from Exchange Transactions
  • Nature and frequency of exchange transactions in the public sector
  • Identifying exchange transactions
  • Accounting principles
  • Specific accounting treatments
  • Disclosures
• IPSAS 11 Construction Contracts
  • Identifying entities and transactions within the scope of IPSAS 11
  • Measuring revenue by stage of completion; revenue and profit recognition
  • Accounting principles; recognition and measurement of contract assets and contract liabilities
  • Accounting for variations
  • Presentation and disclosures
• Non-exchange expense recognition
  • Principles to be considered in relation to the recognition and measurement of liabilities and expenses incurred when making grants and donations
  • Update on considerations from the IPSASB and review of other relevant authoritative guidance to consider
• ED 70 Revenue with Performance Obligations
• ED 71 Revenue without Performance Obligations
• ED 72 Transfer Expenses

Teaching Method

• Group live instruction
• Review of the rationale, objectives and scope of the Standards
• Description and explanation of IPSAS requirements in clear and simple language
• Use of case studies and real-world examples to illustrate practical application of the standards
• Interactive participation
• All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials

Instructors

Venue

CPE/CPD Accreditation

IASeminars is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its website: www.nasbaregistry.org.

 

Field of study: Accounting

Prerequisites

Understanding of basic accounting principles based on any national standards in the public sector. No advance preparation is required for this course.