The IPSASB held its second meeting of the year in New York on June 21-24, 2022.
2. Revenue
3. Measurement
The IPSASB made significant progress in finalizing its transfer expense model. The IPSASB confirmed that a transfer provider’s enforceable rights in a binding arrangement is an asset that is derecognized as the rights are extinguished. For transfers without binding arrangements, the board decided the transfer expense is recognized when control of the transferred resources is lost.
With the revenue accounting models largely shaped in 2021, the IPSASB focused on the application to public sector specific issues. The IPSASB confirmed that existing proposals related to the subsequent measurement of non-contractual receivables and disclosure requirements remain appropriate from a principled perspective. The board also confirmed that accounting principles for binding arrangements should be applied to account for capital transfers.
After analyzing the additional information and perspectives from respondents, the IPSASB agreed to continue developing its public sector measurement basis, Current Operational Value (COV), for assets held for their operational capacity. The IPSASB confirmed the core principles of COV and agreed they should be clarified to enhance understandability. With the core principles agreed, the IPSASB will next focus their attention on developing the non-authoritative text to ensure clarity in their intended application in practice.
The IPSASB continued its analysis of assumption price, cost of release and net selling price. The IPSASB considered the approach of the International Accounting Standards Board and the broader relevance of these measurement bases to public sector financial reporting and decided not to include these measurement bases in a revised chapter on measurement.
The IPSASB agreed on the accounting for concessionary leases. For lessees, the IPSASB agreed to measure the right-of-use asset at fair value on initial recognition. For lessors, the IPSASB decided that the current IPSAS guidance is appropriate for concessionary leases.
The IPSASB performed a detailed review of the responses to ED 78, Property, Plant, and Equipment. The proposals in ED 78 were strongly supported by respondents. The IPSASB agreed to move forward with the proposals related to the structure of the guidance, characteristics of infrastructure assets, additional disclosure of unrecognized heritage assets, and non-authoritative guidance.