GS/OAS/SAF/DFAMS – September 23, 2014

Third progress reporton IPSAS, continued

• Set of internationally recognized accounting standards for the public sector

• Derived from IFRS (International Financial Reporting Standards – private sector)

• Applicable to annual audit book

What’s IPSAS?

• True value of what you own and what you owe (assets / liabilities)

• You are following internationally recognized standards

• Additional annual financial statements and notes to the financial statements

What you get with IPSAS

Changed by IPSAS

Changed by IPSAS

OAS financial InformationOnly one set of financial statements changes with IPSAS

Intended for stakeholders with authority for decision-making

Audited and intended for the general public with no authority for decision-making

• Money savings • Modified management reports

(quarterly report)• Easier to understand annual financial

statements (audit book)• Specific guidelines to improve how

we handle certain operations ( travel, CPRs, budget presentation, etc.)

What you don’t get with IPSAS

Why $5.2 millionInternal and external financing is required

IPSAS costs not included in proposal

•Continued compliance

•ERP implementation

IPSAS costs not included in proposal

•Continued compliance

•ERP implementation

Temporary supervisorsTemporary supervisors

+project

manager/expert+

Business process analyst

+project

manager/expert+

Business process analyst

What is the implementation strategyContinuing operations need temporary CPRs as managers are shifted to IPSAS

Staff for continuing operations

Staff for continuing operations

Existing managersExisting managers

Temporary CPRsTemporary CPRs

25% time

75% time

Continuing operations IPSAS implementation

Why four years and $5.2 millionMajor efforts are required before IPSAS-compliant financials are published

Major overlapping efforts are required to

publish first set of IPSAS-compliant financial

statements

• Implement IPSAS with existing resources (require external financing)

• Ignore continued compliance costs after IPSAS implementation

• Delay decision to implement or not

What we cannot do

• Begin to implement IPSAS now: allocate $3 million in 3-4 years (per plan), or

• Don’t implement IPSAS and gradually continue improving financial information, or

• Build a capital fund to finance IPSAS and, once financed, begin implementation

What we could do going forward