By Mike Thatcher | 21 October 2013
The International Federation of Accountants is developing a plan and a campaign to promote the implementation and adoption of International Public Sector Accounting Standards.
Under the working title of ‘Transparency and accountability in the public sector’, the campaign will encourage countries to adopt accruals-based Ipsas. However, the initial focus will be on building awareness.
Fayez Choudhury, Ifac chief executive, told Public Finance International in a video interview that the campaign would have a number of strands.
‘There will be the actual development of standards, the adoption and implementation of standards, issues of capacity building and training and awareness building. We are trying to develop action plans under each of those themes,’ he said.
Choudhury added that Ifac would be working with the large accountancy firms on the programme. ‘The idea is how we can work together to have a co-ordinated approach to try to persuade governments of the importance of sound public sector accounting methodologies and practices and how we can help.’
In the video interview, Choudhury said there would be no formal targets for converting governments to the benefits of Ipsas.
‘Every one is a victory. Every one that we manage to persuade is a victory. I’m not sure that we would put numerical targets on there. But we’ll certainly see where might our intervention tip the balance as to whether they go down the route of sound accrual accounting or not.’
He added that convincing politicians of the advantages of modern accounting methods was the ‘$64,000 question’, but suggested that ratings agencies might be able to put added pressure on governments.
Choudhury estimated that between 50 and 60 countries had adopted Ipsas and suggested this was ‘not a uniformly bleak’ picture.
‘Clearly, 50 or 60 out of 180 or so is not a huge number. And so there is a requirement for maintaining the pressure for the remaining countries to go down that route.’