FG moves to end IPSAS migration issues
The Office of the Accountant General of the Federation said it is making moves to tackle some of the teething problems affecting the migration from the International Public Sector Accounting Standards, IPSAS, cash basis to IPSAS accrual basis.
Speaking at a retreat on ‘First year of IPSAS accrual basis implementation in Nigeria: Issues and prospects’ the Accountant-General of the Federation, Alh. Ahmed Idris, said some stakeholders have expressed concern on the government’s ability to implement IPSAS accrual basis.
The federal government 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 the approval, the accounting format 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.
He stated that though some deficiencies had been identified during the first year of implementation, the government was putting in place adequate measures to ensure better implementation of IPSAS accrual basis.
Represented at the event by Dr. Bakari Wadinga, Director, Revenue and Investment, the AGF said guidelines and treasury circulars had been issued, while sensitisation as well as accrual manual had been released to guide the agencies of government.
“Transition to IPSAS accrual basis requires a lot of capacity building and commitment to sustainable policy implementation by providing the needed support and resources for Nigeria to adopt global best practice in public finance management,” he said.
He noted that while the “Erstwhile government accounting were on cash basis, the IPSAS accrual accounting basis application requires maintaining full records of financial transactions of government. Besides, IPSAS prescribed specific treatments of various revenues, expenditures, assets, liabilities and disclosure requirements which public sector entities are to comply with,” he stated.
The AGF therefore directed that all government Ministries, Departments and Agencies’ statements of account must be compliant with IPSAS prescriptions.
Also speaking at the retreat, the Auditor-General of the Federation, Mr. Anthony Ayine, said audit gave credibility to any accounting record or statement.
“As first time adopters of IPSAS accrual basis, a lot of challenges are thrown up. I believe very strongly that with this retreat, these issues will be x-rayed and solved,” he said.
“For the MDAs, in particularly the DFAs in the MDAs, it is expected of you to prepare stand-alone financial statements. If we are not careful, it will be an issue so this retreat provides opportunities to ask questions where you are not clear,” he noted.