The Federal Government has commenced moves to address some of the implementation challenges to the adoption of the International Public Sector Accounting Standards, IPSAS.
The Federal Executive Council had in 2010 approved the adoption of the IPSAS by public sector entities to enhance transparency and accountability in the preparation and presentation of financial statements among the three tiers of government.
Following FEC’s approval, the accounting format of the three tiers of government was migrated in 2016 from IPSAS cash basis to IPSAS accrual basis.
The movement from cash to accrual based recording of government financial transactions is to record such transactions in a manner that will show when revenues are earned and not when cash is received, and when expenditures are incurred and not when paid.
Speaking at a retreat on IPSAS adoption on Thursday in Abuja, the Accountant-General of the Federation, Ahmed Idris, explained that while many people had shown great concern on the government’s ability to implement IPSAS accrual basis, some doubted it.
He spoke on the theme, ‘First year of IPSAS accrual basis implementation in Nigeria: Issues and prospects’.
Idris, who was represented by the Director, Revenue and Investment, Office of the Accountant-General of the Federation, Dr. Bakari Wadinga, said that transiting to IPSAS required a lot of capacity building and commitment by stakeholders.
He stated that while some deficiencies had been identified during the first year of implementation, the government was putting in place adequate measures to ensure better implementation.
For instance, he noted that guidelines and treasury circulars had been issued, while sensitisation as well as accrual manual had been released to guide the agencies of government.
“Transiting to IPSAS accrual basis requires a lot of capacity building and commitment by all process owners.” Idris added