The Nigerian Accountant 2012 - The Institute of Chartered ...

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sufficient flexibility for entities to prepare and publish financial
statement discussion and analysis that best portrays their specific
circumstances.
Because of the close link between financial statement
discussion and analysis and an entity’s financial statements, ED
47 proposes that:
• The guidance be issued as an International Public Sector
Accounting Standard (IPSAS) with the same authority as IPSASs
concerning accrual-based financial statements;
• Financial statement discussion and analysis be prepared
and presented in conjunction with an entity’s financial statements;
and
• The qualitative characteristics governing preparation of
financial statements be applied to financial statement discussion
and analysis.
ED 47 includes implementation guidance and an illustrative
example that show how an entity might prepare its financial
statement discussion and analysis to comply with the proposed
requirements.
IPSASB Chairman, Andreas Bergmann notes, “The purpose
of the financial statement discussion and analysis is to provide
additional information to users of an entity’s financial statements
for accountability and decision-making purposes. Financial
statement discussion and analysis complements and supplements
the information in the accrual-based financial statements with
further insights and perspectives.”
IFAC Urges G-20 to Act Against
Inconsistent, Unreliable Public
Sector Financial Reporting
In a letter submitted this month, the International Federation of
Accountants (IFAC), the global organisation for the accountancy
profession with members and associates in 127 countries, urged
the G-20 Deputies and Finance Ministers at their April 2012
meeting in Mexico to take action to encourage governments
to seriously address the quality of public sector financial
management systems and institutions. The letter, which is a
follow-up to previous submissions to the G-20 in 2009, 2010,
and 2011, focuses solely on public sector financial management,
transparency, and accountability.
In March this year IFAC convened a seminar titled The
Sovereign Debt Crisis, a Matter of Urgency ― From Lessons
to Reform, which included presentations, debates, and discussion
involving key decision makers, politicians, and public sector
finance management leaders. Outcomes from the seminar
included the identification of the compelling and urgent need for
governments to address seriously the quality of public sector
financial management systems and institutions. There was a call
for the adoption of accrual accounting and budgeting to better
measure and manage fiscal positions; noting that the current
crisis emphasised the deficiencies associated with cash-based
arrangements. A common theme that emerged was that, in many
countries, the risks associated with the poor fiscal measurement
and management exposed by the sovereign debt crisis are
amplified by the fiscal risks associated with the aging population.
Urgent and fundamental work is needed to determine the
nature of institutional change required in public sector financial
management, transparency, and accountability
The four-key recommendations in the letter are in line with
IFAC’s mission to contribute to the development, adoption, and
implementation of high-quality international standards; and by
doing so, contribute to the development of strong international
economies:
• IFAC recommends that the G-20 facilitate urgent and
fundamental work, to be conducted or commissioned by the
Financial Stability Board (FSB), to consider the nature of
institutional changes that are needed in public sector financial
management to protect the public and investors in government
bonds.
• IFAC encourages the G-20 to make explicit that the FSB’s
role encompasses public sector arrangements, as part of its
aim “to coordinate at the international level the work of national
financial authorities and international standard setting bodies
and to develop and promote the implementation of effective
regulatory, supervisory and other financial sector policies”. In
acknowledging the importance of the public sector as part of
the FSB’s role, IFAC encourages the establishment of a working
group within the FSB architecture, which is specifically tasked
with examining enhanced public sector financial reporting,
transparency and accountability.
• IFAC recommends that the G-20 actively encourage
and facilitate the adoption of accrual-based accounting by
governments and public sector institutions, which promotes
greater transparency and accountability in public sector finances,
and allows for monitoring of government debt and liabilities for
their true economic implications.
• IFAC recommends that the G-20 encourage FSB to include
International Public Sector Accounting Standards (IPSASs) as a
set of standards key for sound financial systems and deserving
of timely implementation.
IFAC Welcomes Publication of Single,
Spanish Translation of the Handbook
of International Standards on
Auditing and Quality Control
The International Federation of Accountants (IFAC), the global
organisation for the accountancy profession with members and
associates in 127 countries, welcomes the Spanish translation of
the Handbook of International Standards on Auditing and Quality
Control.
This single Spanish translation is the result of a two-and-a-halfyear-long
collaborative effort by Instituto de Censores Jurados
de Cuentas de España (ICJCE) and Instituto de Contabilidad y
Auditoría de Cuentas, and a review committee led by Federación
Argentina de Consejos Profesionales de Ciencias Económicas
(FACPCE), with representatives from IFAC member bodies in
Bolivia, Chile, Colombia, Costa Rica, Mexico, Panama, Paraguay,
and Uruguay, and other key stakeholders.
The translated publication includes an unofficial Table of
Equivalencies showing differences between terminology used in
Spain and that commonly used in Latin America. It has also been
reviewed by the Directorate General of Translations (DGT) of the
European Commission for its acceptability in the European Union.
According to Rafael Cámara, president of ICJCE, “ICJCE
is especially delighted with the publication and would like to
congratulate all those involved. This publication represents the
first time a Spanish translation of these high-quality international
auditing standards has been published in Spain, and is the
culmination of several years of work.”
THE NIGERIAN ACCOUNTANT 15
April/June, 2012