342 Government Finance Statistics Manual 2014
fi nancial reporting information can be used as a high-
quality source for the data necessary for GFS reports.
Independent audit of IPSAS-based fi nancial reports
enhances their reliability for GFS purposes.
A6.6 Th e description in this appendix is the same
as the one included in Section 2 of the IPSASB Con-
sultation Paper, IPSASs and Government Finance Sta-
tistics Reporting Guidelines.^1 Readers are referred to
the GFSM 2014 or the latest edition of the Handbook
of International Public Sector Accounting Pronounce-
ments for more detailed explanations of the applicable
reporting guidelines and standards.
A6.7 Th e information provided here is at a high
level, and focuses on identifi cation of diff erences
between the two frameworks. It is not designed to
provide detailed current information about either
IPSASs or GFS reporting guidelines. Detailed infor-
mation on specifi c topics can be found through ref-
erence to individual IPSASs, the 2008 SNA, the ESA
2010 , and the GFSM 2014. Both IPSASs and GFS re-
porting guidelines are dynamic and change over time.
IPSASs, for example, have annual improvements,
which typically impact on a number of diff erent stan-
dards. Th e IPSASB’s Conceptual Framework Project
may also result in changes to IPSASs. For the most
current IPSASs and detailed information on them, it
is important to refer to the Standards themselves.
A6.8 Diff erences between IPSASs and GFS report-
ing guidelines are of two main types: (i) underlying
conceptual diff erences, and (ii) presentation and ter-
minology diff erences.Conceptual Diff erences between IPSASs and GFS Reporting Guidelines
A6.9 Th e conceptual diff erences between IPSASs
and GFS reporting guidelines are discussed under the
following headings:- Objectives
- Reporting entity
- Recognition criteria for some assets, liabilities,
revenue, and expense - Valuation (measurement) diff erences for certain
types of assets and liabilities - Revaluations and other volume changes.
(^1) See http://www.ifac.org/publications-resources/ipsass-and-government-
fi nance-statistics-reporting-guidelines.
A6.10 Box A6.1 compares IPSASs and GFS report-
ing guidelines in these areas.
Objectives.
A6.11 GFS reporting guidelines and IPSASs have
diff erent objectives for the two sets of fi nancial infor-
mation produced. GFS reports are used to: (i) analyze
fi scal policy options, make policy, and evaluate the
impact of fi scal policies, (ii) determine the impact on
the economy, and (iii) compare outcomes nationally
and internationally. Th e focus is on evaluating the
impact of the general government and public sector
on the economy, and the infl uence of government
on other sectors of the economy. Th e GFS reporting
framework was developed specifi cally for public sec-
tor input to other macroeconomic accounts, although
a range of countries adopt GFS reporting for their
fi scal reporting, and for measuring compliance with
fi scal rules. By contrast, IPSAS-based fi nancial state-
ments are used to: (i) evaluate fi nancial performance
and position, (ii) hold management accountable, and
(iii) inform decision-making.
A6.12 Although the two sets of fi nancial informa-
tion necessary to meet these diff erent objectives have
many similarities, the diff erent objectives do result in
some fundamental diff erences in how and what infor-
mation is reported. For example, in GFS reports, one
distinction for transactions in fi nancial assets and lia-
bilities is whether the counterparty of the transactions
is a resident or nonresident. In contrast, IPSAS-based
fi nancial statements report these transactions accord-
ing to whether they are current or noncurrent assets
or liabilities, with classifi cation also in terms of their
maturities and supplementary information provided
on risks.Reporting entity
A6.13 One of the fundamental diff erences between
GFS reporting guidelines and IPSASs relates to the
defi nition of the reporting entity and the process of
consolidation (collectively oft en referred to as “iden-
tifi cation of the reporting entity boundary”). Under
GFS reporting guidelines, as described in Chapter 2 of
the GFSM 2014 and in Chapter 4 of the 2008 SNA, in-
stitutional units are aggregated and consolidated into
statistical sectors and subsectors. Th e focus of statis-
tical reporting is primarily on consolidated sectors
and subsectors. Although it is theoretically possible to