Financial Reporting for Heritage in the Public Sector

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The International Public Sector Accounting Standards Board (IPSASB) has published a Consultation Paper, Financial Reporting for Heritage in the Public Sector (the CP), for comment. 

The matters discussed in the CP are relevant for Tier 1 and Tier 2 public benefit entities (PBEs)—both public sector and not-for-profit entities.

Many public sector and not-for-profit PBEs have heritage assets and responsibilities to preserve heritage items. This CP is a first step toward developing financial reporting guidance to support comparability, accountability and decision making in this area.

We look forward to receiving your views on the IPSASB’s proposals.

The CP describes heritage items as items that are intended to be held indefinitely and preserved for the benefit of present and future generations because of their rarity and/or significance. The CP proposes that:

  • heritage items’ special characteristics do not prevent them from being assets for the purposes of financial reporting;
  • heritage items should be recognised in the statement of financial position if they meet the recognition criteria in the IPSASB’s Conceptual Framework; and
  • in many cases, it will be possible to assign a monetary value to heritage assets.

It also discusses:

  • initial and subsequent measurement of heritage assets;
  • whether heritage preservation responsibilities could involve present obligations for entities, which should be recognised as liabilities in the financial statements; and
  • presentation of information for heritage in general purpose financial statements.

Current PBE requirements

When the New Zealand Accounting Standards Board (NZASB) developed the PBE Standards, IPSAS 17 Property, Plant and Equipment was modified for heritage assets.

PBE IPSAS 17 requires application of the recognition and measurement requirements in that Standard to heritage assets when they can be reliably measured.

The NZASB will reconsider this requirement when the IPSASB has issued their final guidance on financial reporting for heritage.

How to comment

You can send your comments in an email or letter and these can be formal or informal. 

Comments are due to the NZASB by 18 August 2017 and to the IPSASB by 30 September 2017.

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