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The report—IPSAS implementation: current status & challenges—notes that the adoption of IPSAS has the potential to radically change accounting and financial reporting in public sectors around the world, and particularly in developing countries. However, while adoption is gaining momentum around the world, progress has remained slower than is desirable as adopting countries face specific, complex and consistent implementation challenges.
“The successful adoption of IPSAS can help provide greater clarity on the financial position of public sector entities around the world, delivering greater accountability and transparency, as well as supporting public bodies in improving financial decision making” said Maggie McGhee, Director of Professional Insights at ACCA.
“In Europe, for example, the European Union announced the formal adoption of European Public Sector Accounting Standards (EPSAS) in 2015, and successful adoption will be crucial to meet the objectives of fiscal stability and deeper economic and financial integration within the EU.
“However, our research also draws on the experiences of countries around the world in the process of adopting IPSAS and suggests that progress remains slower than is desirable; few have completed it successfully and seamlessly.”
The report notes that professional accountancy organisations should consider the role they can further play in raising awareness of the need for transparent financial reporting in the public sector, including – and also going beyond – providing training on accounting standards.