GoG adopts new global accounting standards

Ken Ofori-Atta, Finance Minister

Public sector fiscal transparency and accountability has been given another shot in the arm as the Ministry of Finance has finally approved the adoption and implementation of the International Public Sector Accounting Standards (IPSAS).

The adoption of Accruals IPSAS, which took place on Wednesday in Accra, will ensure that all public accounts are prepared on Accrual basis, leading to the matching of revenue with expenditure in the period it relates to, so as to give an accurate assessment of financial performance of the Government.iog

Further to this, long term expenditures incurred for the acquisition of assets are spread over the useful life of the assets, providing accurate and adequate data for effective management and safeguarding of Government’s fixed assets as well as ensuring regular review of the state of such assets.

Fixed Assets Management Guidelines have been developed to guide the use and management of Government of Ghana (GOG) fixed assets as enshrined in Section 52 of the Public Financial Management (PFM) Act, 2016 (Act 921).

The IPSAS is presently the focal point of a global revolution in government accounting, ensuring much greater government financial accountability and transparency.

IPSAS Implementation Committee

In the lead up to this adoption, the Controller and Accountant General’s Department (CAGD) inaugurated an IPSAS Implementation Committee, mandated to supervise and direct the processes of lPSAS implementation in the country.

Capacity of the Implementation Committee members is enhanced to be able to supervise and direct the implementation process.

At the launch and adoption of the IPSAS, the Controller and Accountant General noted that an IPSAS compliant Accounting Manual has been developed.

Henceforth, all MDA’s and MMDA’s are expected to be guided by the Accounting Manual to develop Departmental Accounting Instructions to meet their specific operations.

The CAGD has also established a Secretariat to coordinate the implementation of IPSAS in all covered entities across the country.

The PFM law will be enforced with regards to specifying accounting standards and policies for covered entities. All government institutions and some SOEs are therefore to be guided by the requirement of IPSAS in financial accounting and reporting.

In collaboration with the Institute of Chartered Accountants (Ghana), government announced the adoption of International Public Sector Accounting Standards (IPSAS) in October 2014 and a formal declaration was made in the 2015 Budget and Economic Policy presented to Parliament in November 2014.

Following the adoption of IPSAS by the Government of Ghana in 2014, the Controller and Accountant-General was mandated to lead its implementation.

By Joshua W. Amlanu