The International Public Sector Accounting Standards Board (IPSASB) has proposed amendments to International Public Sector Accounting Standards (IPSAS) to conform to the financial instruments accounting standard developed by the International Accounting Standards Board (IASB), International Financial Reporting Standard (IFRS) 9, Financial Instruments. The comment due date is 31 December 2017.

The proposal is set out in Exposure Draft 62, Financial Instruments. If adopted, the proposal will replace IPSAS 29, Financial Instruments: Recognition and Measurement. The proposed standard introduces features that the IPSASB believes would improve public sector financial instruments reporting, including the following:

  • Simplified classification and measurement requirements for financial assets
  • An impairment model that is forward looking
  • A hedge accounting model with enhanced flexibility.

The IPSASB drafted the proposal to align the IPSAS financial instruments standard with IFRS 9, modified to make the requirements public sector specific. The proposal also includes guidance on financial guarantees issued through non-exchange transactions and concessionary loans. It also provides examples illustrating how to apply the proposed principles to transactions that are specific to the public sector.

In addition to the Exposure Draft, the IPSASB has issued a companion At-a-Glance document, Exposure Draft: Financial Instruments, which provides an overview of the proposal and gives instructions for commenting on the Exposure Draft.

The Exposure Draft is available on the link below: