Evaluation of Financial Reporting “Fair Presentation” Conceptual Objective of International Public Sector Accounting Standards (IPSASs) in Africa
- August 27, 2020
- Posted by: RSIS
- Categories: Banking & Finance, IJRISS
International Journal of Research and Innovation in Social Science (IJRISS) | Volume IV, Issue VIII, August 2020 | ISSN 2454–6186
Zivanai Mazhambe
Finance and Accounting Department, University of Zimbabwe
Abstract: General purpose financial statements issued in compliance with the International Public Sector Accounting Standards (IPSAS) are determinative and useful for decision making by all stakeholders. This scientific study purpose is to evaluate the financial reporting conceptual objective of IPSAS ‘fair presentation’ in Africa. The study methodology adopted is mixed research methodology, through questionnaires and interviews on PAFA accountants in public sector practice across Africa. The findings revealed that the IPSAS financial reporting conceptual objective of ‘fair presentation’ is attainable with consistent application of professional judgments, taking into accounting the requisite accounting principles. Fair presentation is technically compounded for the average professional to apply, and requiring a lot of additional guidance over a prolonged period of time for the preparer of the financial reports to comply with all IPSASs in the process of complying with the conceptual qualitative characteristics of relevance and reliability.
Keywords: IPSASs, PAFA, Fair Presentation, IPSASs Objectives, IPSASs Challenges
I. INTRODUCTION
According to IPSAS 1, for general purpose financial statements to be described as issued with ‘fair presentation’ must in all circumstances be in compliance with all IPSASs, disclosing present information that is relevant, understandable, timely, comparable, faithfully represented with verifiable information stating the applicable accounting policies.
II. LITERATURE REVIEW
IFRS Foundation (2015) outlines that for financial information to be considered useful for decision making; it must comply with the qualitative characteristics of: prudence, reliability, understandability, materiality, neutrality, completeness and substance over use. Additionally (IFRS, 2015) for fair presentation to be attained, the following fundamental and enhancing characterstics should be factors: relevance, faithful representation, comparability, verifiability and understandability.
