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Tag: ipsas

Chief Directors Of MDAS Sensitized To New Accounting Standards

The Controller and Accountant General’s Department (CAGD) has asked all ministries, departments and agencies (MDAs) to brace up for a full implementation of the International Public Sector Accounting Standards (IPSAS) by 2022.

According to the Controller and Accountant-General, Mr Kwasi Kwaning-Bosompem, the IPSAS was meant to improve on transparency and accountability in the management of public resources.

The IPSAS is a set of standards set up by the International Federation of Accountants (IFAC) to regulate and guide the preparation, presentation and disclosure of financial statements to improve public sector financial management.
The overall objective of the IPSAS is to ensure that the MDAs prepare complete and concise financial statements to ensure efficient use of public resources.

 

Timelines
Although Ghana announced the adoption of the IPSAS in 2014 and gave 2019 as the deadline for its implementation, the country could not meet the timeline.

Addressing the opening session of a sensitisation forum for chief directors of MDAs in Accra yesterday, Mr Kwaning-Bosompem announced that the new deadline for implementation of the IPSAS was now 2022.

He said the sensitisation forum for the chief directors was the first of many workshops to build the capacity of top officials and technical staff of MDAs and metropolitan, municipal and district assemblies (MMDAs) on the new financial management regime.

New regimeMr Kwaning-Bosompem explained that while the current financial reporting system was not comprehensive enough, the IPSAS regime thrived on an accrual reporting system which was more encompassing and transparent.

For instance, he said at the end of the year, the government had unpaid bills but those were not reported in the current financial statements, adding that  the accrual reporting system on the other hand, would state clearly the outstanding bills so that when the budget was being reported, the unpaid bills would be taken cognisance of.

“The country stands to benefit from a comprehensive reporting system because information is money and when you have good information, you attract investors because there is a transparency regime,” he added.
Mr Kwaning-Bosompem said the CAGD was committed to leveraging technology to improve the country’s financial management system.

He urged all MDAs to strictly comply with a directive to use the Ghana Integrated Financial Management Information Systems (GIFMIS) platform for all government businesses.

Benefits
The Vice-President of the Institute of Chartered Accountants, Ghana (ICAG), Dr Williams Abayaawien Atuilik, for his part, said the accrual financial reporting system would help address lapses in public financial management.
“The Attorney-General’s Department always makes reference to inadequate information in financial statements prepared by the MDAs and public sector institutions.

The fact is that we are doing partial accounting which does not give a full picture of our debts, assets and commitments and people have to be commissioned to extract information from elsewhere.

If we want to do perfect financial reporting, accrual system is the way to go,” he stressed. Dr Atuilik said the new financial reporting regime would facilitate the monitoring of public assets and the public purse.

The Head of Civil Service, Nana Kwasi Agyekum Dwamena, who also addressed the session, said the accrual reporting system would help improve service delivery and the performance of public institutions.
It was his take that if the country wanted to improve on its financial management system, the way forward was to embrace the new reporting regime.

Nana Dwamena underscored the need for capacity-building programmes for technical staff in the MDAs and the MMDAs for the smooth take-off of the new reporting system.

 

Background:

Ghana announced the adoption of the IPSAS accrual system in 2014 and was expected to roll it out between 2015 and 2019.

Following the country’s inability to meet the deadline, it was rescheduled for 2022.
The implementation of the IPSAS is expected to strengthen the Public Financial Management (PFM) reform strategy and the Ghana Integrated Financial Management Information Systems (GIFMIS).

 

 

Source: Daily Graphic

CAGD Sensitizes Chief Directors Of MDAS On IPSAS

The Controller and Accountant General’s Department (CAGD) has sensitized Chief Directors of the various Ministries, Departments and Agencies (MDAs) on the International Public Sector Accounting Standards (IPSAS), which, Ghana has set out to implement to improve its public accounts.

The adoption and implementation of IPSAS have been identified as one of the critical programmes in the Public Financial Management Reforms currently underway in Ghana, and it is expected to improve fiscal transparency and accountability.

The CAGD, therefore held the sensitization on Tuesday, as part of the implementation processes of the IPSAS- a comprehensive set of standards to regulate and guide the preparation, presentation and disclosure of the general purposes financial statements in the Public Sector.

The International Public Sector Accounting Standard Board (IPSASB), an organ of the International Federation of Accountants (IFAC) developed the IPSAS for all countries of the world.

Mr Kwasi Kwaning-Bosompem, Acting Controller and Accountant General, told the chief directors, that they were critical partners in the successful implementation of the IPSAS, which applied to all public sector entities excerpt government business enterprises set up for commercial purposes.

He said the implementation of the IPSAS would further strengthen the Public Financial Management Reforms Strategy and the effective use of the Ghana Integrated Financial Management Information System.
He said for a long time, prior to the adoption of the IPSAS in 2014, the public Accounts of Ghana had been prepared in compliance with the Generally Accepted Accounting Principles in accordance with the financial laws such as FAD 1979, Financial Administrations Act 2003 on Cash Basis.

However, realizing the shortcomings of the cash base accounting, the CAGD had in recent years, moved to the use of the Modified Accrual Basis, which was not totally in line with international standards, and had invariably, affected Ghana’s Public Expenditure and Financial Accountability ratings.

“It is, therefore, a relief that the Ministry of Finance approved the adoption and implementation of the IPSAS, which ensures Public Accounts are prepared on Accrual Basis”, Mr Kwaning-Bosopem said, adding that, the IPSAS implementation was launched in November 2018 with an initial sensitisation programmes organized for Accounting officers from the MDAs in Accra early this year.

He said when the Accrual Basis IPSAS was implemented; it would lead to the matching of revenue with expenditure in the period it relates, to give an accurate assessment of the financial performance of the Government.
It would ensure that long term expenditure incurred for the acquisition of assets were spread over the useful life of the assets, while providing accurate and adequate data for effective management and safeguarding of government fixed assets as well as ensuring regular review of the state of such assets.

Nana Kwasi Agyekum Dwamena, Head of Civil Service, commended the CAGD for engaging the Chief Directors as technical and bureaucratic Heads of the MDAs, in the sensitisation of the IPSAS, saying that, as spending officers, it was in order for them to know about the system and the legal framework of their responsibilities towards the successful implementation of the IPSAS.

Dr Willams Abayaawien Atuilek, a member of the IPSAS Implementation Committee, in a presentation, said many countries had followed through and were currently implementing IPSAS to ensure they conformed to international standardisation.

He said IPSAS, would improve government financial reporting in terms of completeness, consistency and compliance as well as aiding financial information flow, adding that, the Accrual Basis that had been adopted by Ghana had 42 standards that were required to be implemented.
He said IPSAS would also ensure proper monitoring of all public financial accounts, thereby promoting transparency and quality service delivery in the public sector.

Dr Atuilek said Ghana expected to fully implement the IPSAS by 2022, adding that, the process also included consistent training of all financial and account officers of the MDAS and other stakeholders, as well as evaluation of all financial assets of the states.

The World Bank through the Swiss Government is supporting the implementation process of IPSAS, Dr Atuilek said.
Mr Samuel Aryee, Chairman of IPSAS Implementation Committee, and Deputy Controller and Accountant General in charge of ICT and Information Management Services, said the implementation was being done together with the Institute of Chartered Accountants.

 

 

Source: ghananewsagency.org

International Public Sector Accounting Standards (IPSAS) Launching

The Controller and Accountant General’s Department will formally launch the implementation of IPSAS in Ghana on November 28, 2018 at the Swiss Spirit (ALISA) Hotel in Accra, at 10:00am.

The Guest of Honour for the launch is His Excellency Dr. Alhaji Mahamudu Bawumia, Vice President of the Republic of Ghana.

Key note address will be delivered by Hon. Ken Ofori Atta, the Minister of Finance.  The function will be under the chairmanship of by Hon. Yaw Osafo Marfo, the Senior Minister.

 

  • International Public Sector Accounting Standards (IPSAS) are a set of accounting standards issued by the IPSAS Board for use by public sector entities around the world in the preparation of financial statements. These standards are based on International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB).

    The standards apply to all Public Sector entities other than Government Business Enterprises set up for commercial purposes.

    Its main objective is to improve the quality of general purpose financial reporting by Public Sector entities, leading to better informed assessments of the resource allocation decisions made by governments, thereby increasing transparency and accountability.

    The IPSAS Board has so far issued 40 Standards

    Over 100 countries across the globe have adopted IPSAS

  • More than 15 countries in Africa are in various stages of implementing IPSAS
  • International bodies like UN African Union and Organization of American States have adopted IPSAS

 

Benefits of IPSAS

  • Improves transparency by providing complete view of government business and performance.
  • High level of accountability by ensuring accurate recording of government performance and status.
  • Greater credibility as governments use same accounting standard.
  • More effective monitoring of the existence and value of assets and liabilities through effective assets management.
  • Better matching of cost to revenue by depreciation of assets.
  • Support better decision making by using quality information.
  • Harmonization of reports and statements across nations.
  • Better comparison of financial statements among countries.

IPSAS In Ghana

  • Ghana announced the adoption of IPSAS Accrual in 2014.
  • Implementation will be completed in the year 2023
  • The implementation is to further strengthen the Public Financial Management (PFM) Reforms Strategy and the use of Ghana Integrated Financial Management Information System (GIFMIS)
  • The Institute of Chartered Accountants Ghana (ICAG) is monitoring IPSAS implementation as the regulator of accountancy practice in Ghana.
  • The promulgated PFM Act 2016 (Act 921) provides Legal backing for IPSAS.

 

The Journey So Far….

  • IPSAS Secretariat established in Controller and Accountant – General’s Department.
  • IPSAS Implementation Strategy Developed.
  • Capacity built for IPSAS Implementation Committee Members.
  • Liability and provisions included in financial statements since 2010
  • Fixed assets capitalized and Depreciation thereof charged since 2012
  • Modified Accrual Accounting basis being used currently for production of Consolidated Fund (CF) financial statements.
  • The World Bank and SECO are providing part of funding for the implementation.