GFS and International Public Sector Accounting Standards 349
of prior year fi gures for policy changes and errors is
not specifi ed.
Mapping from IPSAS fi nancial statement aggregates to GFS aggregates
Total assets and total liabilities
A6.47 Some broad classifi cation diff erences exist
between the classifi cation of assets and liabilities in
GFS and IPSASs.
- GFS classify assets and liabilities in terms of
whether they are fi nancial or nonfi nancial. IP-
SASs do not require assets and liabilities to be
grouped in these terms, nor do they require
summary totals for fi nancial and nonfi nancial
assets. However, they do require fi nancial and
nonfi nancial assets and liabilities to be separately
disclosed, which means that there is suffi cient
information in an IPSAS statement of fi nancial
position (balance sheet) to determine totals for
fi nancial and nonfi nancial assets and liabilities. - GFS classify fi nancial assets and liabilities into
domestic and foreign. IPSASs do not use this
classifi cation, although some of these disclosures
may be included in an entity’s risk management
disclosures related to fi nancial instruments. - GFS classify assets and liabilities according to
standardized GFS characteristics and purposes,
which can diff er from the classifi cations required
by IPSASs. For example, in IPSASs, the classifi ca-
tion of property is determined by whether it is
an investment property, while GFS distinguishes
property according to whether it is a produced/
nonproduced asset and whether it is a dwelling,
other building, other structure, or land improve-
ment. IPSASs classify fi nancial instruments into
whether they are for trade or to be held until
maturity, whether liabilities are employee li-
abilities, and whether provisions relating to en-
vironmental restoration all diff er from the GFS
classifi cation.
Net worth
A6.48 Th e GFS concept of net worth plus equity
(also referred to as own funds) is equal to IPSASs’ net
assets/equity:
- In GFS, net worth for a specifi c period is defi ned
as total assets minus total liabilities. Th e balance
sheet opening net worth + operating balance +
changes in all assets and liabilities due to other
economic fl ows = balance sheet closing net
worth.- According to IPSASs, net assets/equity is calcu-
lated as the opening net assets/equity + surplus/
defi cit + items shown directly on changes in eq-
uity statement = closing net assets/equity. Net
assets/equity is also equal to the net of all assets
minus liabilities, excluding equity.
A6.49 Th ese diff erences in the calculation of the
net balancing item primarily result from the diff er-
ences between how GFS and IPSASs allocate items
to their respective statements (GFS showing other
economic fl ows separately). In addition, it should be
noted that, in the GFS net worth concept, equity is
treated symmetrically as part of fi nancial assets and
liabilities—that is, equity investments within assets,
and any equity of the government entity held by
nongovernment units—usually rare for government
entities—within liabilities. In contrast, the IPSAS net
assets/equity concept includes equity that GFS treats
as a liability, whereas investments in another entity’s
equity are recognized as fi nancial assets.
A6.50 In addition to these presentational diff er-
ences, the values of these items can also diff er due to
valuation and recognition diff erences.
Revenue and expense
A6.51 Although the GFS and IPSAS accrual con-
cepts of revenue and expense are diff erent, they can be
reconciled as follows:- GFS revenue + other economic infl ows = IPSAS
revenue + economic infl ows recognized directly
in Statement of Changes in Net Assets/Equity - GFS expense + other economic outfl ows = IPSAS
expense + outfl ows recognized directly in State-
ment of Changes in Net Assets/Equity.
A6.52 IPSASs refer to materiality as a classifi cation
criterion for revenue and expense. In this context, GFS
requires reporting on standard items. In addition to
the economic classifi cation (as shown), the GFSM 2014
and the SNA/ESA also have a Classifi cation of Func-
tions of Government (COFOG).
A6.53 Under IPSASs and GFS, cash fl ows result-
ing from acquisitions or disposals of assets are recog-
nized in the Cash Flow Statements. However, in the
accrual-based accounts, the time of recording asset