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12 Feb. 2019

Public Sector: Collective and Individual Services and Emergency Relief

Are you a public sector entity that needs to account for the provision of emergency relief services or other general services, such as health care, education or defence? If yes, you are encouraged to provide comments to the International Public Sector Accounting Standards Board (IPSASB), on its recently issued Exposure Draft (ED) 67 Collective and Individual Services and Emergency Relief, which proposes guidance on accounting for collective and individual services (eg. defence and health care), as well as emergency relief.

The ED proposes amendments to IPSAS 19 Provisions, Contingent Liabilities and Contingent Assets, including that no provision is recognised for the intention to deliver collective and individual services. Any obligations that may arise for providing collective and individual services are not independent of the entity’s future actions, and therefore do not give rise to a present obligation prior to the delivery of these services.

The ED defines ‘collective services’ as services provided by a public sector entity simultaneously to all members of the community that are intended to address the needs of society as a whole, such as street lighting and defence service. ‘Individual services’ are defined as goods and services provided to individuals and/or households by a public sector entity that are intended to address the needs of society as a whole, such as public sector healthcare services and education services. 

The ED also proposes applying IPSAS 19 to determine whether a provision should be recognised, or if it should disclose a contingent liability, for the delivery of emergency relief. 

The IPSASB is seeking views on its ED by 31 May 2019. The AASB requests that if Australian constituents respond to the IPSASB’s Exposure Draft, they also send the AASB a copy of their comments. 

The AASB also requests Australian constituents to comment to the AASB on the appropriateness of any of the proposals in IPSASB ED 67 for adoption in Australia. This feedback would be considered by the AASB as part of its separate due process if it proceeds to develop similar proposals in due course.