Public Sector Accounting Standards Board Research Articles

The Relationship Between Financial Analysis and Business Performance at Public Universities in Vietnam

Purpose: This article aims to clarify the relationship between financial analysis and business performance at public universities in Vietnam. In addition, the influence of financial analysis on operational results. Theoretical framework: In the context of increasing financial autonomy in public universities in Vietnam, the issue of financial analysis aims to provide information for managers to plan, organize, control, and make decisions. Financial information must be reliable, transparent, and accountably defined. Most universities in Vietnam are not actively engaged in financial analysis activities, and there are significant research gaps globally. Method/design/approach: The research sample, collected online, consisted of 425 respondents in managerial positions (including accounting, auditing, financial, vice principal, and principal positions) in public universities. Sampling took place over a 3-month period from September 2022 to December 2023. Using quantitative research and the PLS-SEM structural equation modeling in SPSS 20 and AMOS 20 software. Results and conclusion: The study identified two factors with the strongest influence on financial analysis in public universities in Vietnam: (i) the analysis data base (AD); and (ii) the analysis content (CA) and influence of financial analysis on operational results. The research provided in-depth insights and critical discussions and evaluations in financial analysis at public universities in Vietnam, recommending the adoption of public accounting standards for financial reporting developed by the International Public Sector Accounting Standards Board (IPSASB) or the use of EVA indicators (net operating profit after tax minus cost of capital) in financial analysis activities. Research implications: This research uses the contents of financial analysis and operational results based on prior studies in the realm of the public and universities. Within the context of the digital transformation of the entire society and improving the quality of education, these variables are useful solutions for universities. Originality/value: This study uses a new research methodology to analyze and measure the relationship between financial analysis and business performance at public universities in Vietnam. The paper's primary contribution is findings that benefit the public universities in Vietnam in the improvement of their training quality and business performance.

Assessing the countries’ convergence to IPSAS from a cultural perspective

PurposeThis paper aims to assess the factors that may explain the International Public Sector Accounting Standards (IPSAS) convergence, considering Hofstede’s cultural dimensions as the theoretical reference for the cultural approach proposed. Additional factors include countries’ contextual and macroeconomic characteristics.Design/methodology/approachLogistic and probit regression models were used to identify the factors that may explain the IPSAS (fully or adapted) use by countries, including 166 countries in this assessment (59 for those whose cultural dimensions are available).FindingsThe findings consistently indicate collectivism and indebtedness levels as explanatory factors, providing insights into cultural dimensions along with macroeconomic characteristics as a relevant factor of countries’ convergence to IPSAS.Research limitations/implicationsThere are different levels of IPSAS convergence by countries that were not considered. This aspect may hide different countries’ characteristics that may explain those options, which could not be distinguished in this paper.Practical implicationsAs a result of this paper, the International Public Sector Accounting Standards Board may gain insights that can be applied within the IPSAS due process to overcome the main challenges when collaborating with national authorities to achieve a high level of convergence. This analysis may include how to accommodate countries’ cultural differences as well as their contextual and macroeconomic characteristics.Social implicationsThere is a trend of moving toward accrual-based accounting standards by countries. Because the public sector embraces a new culture following the IPSAS path, it is relevant to assess if there are cultural factors, besides contextual and macroeconomic characteristics, that may explain the countries’ convergence to those standards.Originality/valueTo the best of the authors’ knowledge, this is the first cross-country analysis on the likely influence of cultural dimensions on IPSAS convergence as far as the authors’ knowledge.

New development: IPSAS-lite—Some reflections and a call for research

IMPACT While public sector entities range in size, influence and complexity, few countries write financial reporting standards specifically to accommodate the particular user needs of smaller or less complex entities. In addition to reducing the benefits to users, this is likely to impose greater costs on preparers. The author argues that the International Public Sector Accounting Standards Board (IPSASB) should address this problem by implementing its proposal for ‘IPSAS-lite’. Some structural decisions that IPSASB will need to make are outlined.

Differential reporting in the public sector—financial reporting for small- and medium-sized entities

IMPACT According to the International Public Sector Accounting Standards Board (IPSASB), public sector entities should apply the IPSAS when they fulfill certain criteria, such as the delivery of public services or financing by taxes. Size is currently not a matter for the application of IPSAS and smaller public sector entities have to apply the full suite of IPSAS. Based on an empirical study, this article shows that differential reporting is a suitable approach to overcome the accounting challenges that small- and medium-sized public sector entities (SMPSEs) are facing. The authors explain the potential advantages and disadvantages of differential reporting in the context of SMPSEs’ accounting challenges.

Culture, language, and accounting reform: a new perspective on IPSAS implementation

PurposeThis study aims to explore the role that culture and language play in the implementation of International Public Sector Accounting Standards (IPSAS).Design/methodology/approachThe Hofstede–Gray and Huerta et al. (2013) models were used to collect data on language and accounting culture. Paired-sample t-test, regression and factor analyses were conducted on data from a sample of 101 respondents. This study also used ordinary least squares to test hypotheses.FindingsThe cultural dimensions of professionalism, secrecy and uniformity significantly influence the implementation of IPSAS. Furthermore, this study finds a significant link between culture, language and IPSAS implementation, which underlines the need for careful consideration of International Public Sector Accounting Standards Board policies in the promotion of IPSAS internationally.Research limitations/implicationsWhile this study is limited to its research method, using secondary data would have been challenging given the setting and accessibility issues. This study overcomes this problem by using a self-administered questionnaire. Prior studies confirm the reliability of the constructs. Despite providing justifications for why the authors use judgemental sampling, the authors acknowledge the limitation of the technique in survey distribution. Furthermore, the findings cannot be read without caution, as the authors focused on one country. However, interactions between accounting practices and culture in one country may be transferred to other countries that share a common language and culture with Qatar. The authors believe future research in this area will complement the understanding of the determinants of IPSAS implementation should the study be replicated.Social implicationsPolicymakers, standard setters and regulators should promote and enforce an integrated approach that reflects the need for accountants and auditors to be conscious of the effects of culture and language, given the likelihood of widespread IPSAS adoption.Originality/valueThis study offers insight into the significance of culture and language in reforming public-sector accounting systems in developing nations and emerging economies.

Designing international public sector accounting standards: An analysis of constituents’ participation through comment letters

AbstractHarmonization of public sector accounting is attracting increasing attention from scholars and practitioners. A focal component of this phenomenon is the setting of accounting standards, whose legitimacy is paramount to their application. As participation by constituents is considered fundamental for ensuring this legitimacy, in this study, we focus on participation through comment letters in the due process. In particular, we explore the type of respondents, their geographical area, their agreement/disagreement with the documents prepared by the International Public Sector Accounting Standards Board (IPSASB) and the issues of importance to them, through an analysis of the comment letters submitted for six projects launched over the period 2017–2020 by the IPSASB. Furthermore, we analyze some factors that may affect countries’ participation in the due process. The analysis enriches our understanding of the IPSASB's due process and provides relevant insights for the growing research into accounting standard‐setting.

Accounting as Technical, Social and Moral Practice: The Monetary Valuation of Public Cultural, Heritage and Scientific Collections in Financial Reports

AbstractThe International Public Sector Accounting Standards Board of the International Federation of Accountants issued exposure draft ED78Property Plant and Equipment in April 2021. It proposes valuing ‘heritage items’ for recognition as ‘heritage assets’ in statements of financial position. This proposed requirement for global application casts the spotlight on a highly controversial topic in regulated financial reporting. The monetary valuation of cultural, heritage and scientific collections of public not‐for‐profit museums, art galleries and similar repositories has been subject to considerable discussion and debate for the past three decades. Our purpose is to critically examine this perennial financial reporting controversary, in the context of the three conceptions of accounting: accounting as technical practice, social practice and moral practice as articulated in the definition of accounting proposed by Carnegie et al. (2021a, 2021b) for discussion, debate and potential adoption in the accounting profession, including by accounting standard setters in all sectors. This article is intended to challenge accounting to enhanced self‐awareness in reaching its full potential.

Stakeholder participation in the development of International Public Sector Accounting Standard 42, Social Benefits

AbstractThis study aims to contribute to the understanding of stakeholder participation within the International Public Sector Accounting Standards Board's (IPSASB) due process. This study examines IPSASB's input legitimacy by analysing who the respondents are in exposure draft (ED) 63, Social Benefits, and to what extent they support the ED; however, the emphasis lies on the quality of the IPSASB's due process through the legitimacy theory, more precisely procedural legitimacy, by investigating to what extent the respondents’ input was considered and integrated into the final International Public Sector Accounting Standards. Most respondents originate from Europe and Oceania and consist of professional associations and public sector entities. There are indications that some respondents’ input was integrated; however, results indicate a clear flaw in the lack of transparency regarding how respondents’ input is analysed, which makes the decision‐making process seem arbitrary and subjective and could potentially have a negative effect on the IPSASB's legitimacy.

Heritage assets in financial reporting: a critical analysis of the IPSASB's consultation paper

PurposeWithin the stream of research on public sector accounting standards, heritage asset accounting represents a difficult and challenging issue. This paper intends to join the debate on heritage reporting by carrying out a critical review of the Consultation Paper (CP) “Financial Reporting for Heritage in the Public Sector” issued by the International Public Sector Accounting Standards Board (IPSASB) in order to highlight its strengths and weaknesses and to make recommendations.Design/methodology/approachTo this end, the current study adopts document analysis as a qualitative research method by referring to Italy as a typical and critical case study. Moreover, the authors actively took part in the Italian working group on heritage assets reporting, so they are well-informed people about the Italian point of view as well as the broad discussion underpinning the Italian response.FindingsEvidence demonstrates that, although the proposals included in the CP represent a new step towards an organic regulation of heritage asset reporting, if these preliminary views are confronted with the reality of an emblematic context, as in the Italian case, much room for improvement remains regarding the definition, recognition, measurement and disclosure of such assets.Originality/valueThe originality of the paper lies in its contribution to overcoming the current controversial aspects of heritage assets reporting and the issuing of an accounting standard. In doing so, the authors also attempt to answer the call made by Anessi-Pessina et al. (2019) to investigate in detail an individual country experience to better understand the state of the art in national and international accounting standards on heritage assets.

The IPSASB's recent strategies: opportunities for academics and standard-setters

PurposeThe purpose of this article is to contribute to an ongoing dialogue between practitioners and academics. This article describes the International Public Sector Accounting Standards Board (IPSASB) recent strategies and highlights the IPSASB's increasing outreach to academics.Design/methodology/approachThis is a practitioner's viewpoint which reflects the IPSASB's publicly available documents, and the opinions of a practitioner directly involved in the IPSASB's work and International Public Sector Accounting Standards (IPSAS) development.FindingsThe findings are that the IPSASB has increased its outreach to academics and now academics have more opportunities to engage with the IPSASB and IPSAS developments. The IPSASB's strategy has remained relatively constant over time, focusing on IPSAS to address public sector-specific issues, alignment with the International Financial Reporting Standards (IFRS) and reduction of differences between IPSAS and Government Finance Statistics (GFS) reporting guidelines.Research limitations/implicationsThe limitations of this article (which are also its strength in terms of fitness for purpose) are that as a practitioner's viewpoint it provides a brief overview and personal judgments, rather than an empirical analysis of developments applying a theoretical framework.Practical implicationsThe practical implications were IPSASB's increased outreach to the research community providing opportunities for academics to have increased input into IPSAS development, with likely benefits to researchers and the IPSASB.Social implicationsPractitioners’ engagement with academics supports increased understanding of the respective views leading to better outcomes for practitioners and academics working in the area of public sector financial reporting and its regulation.Originality/valueThis article is the first to (a) describe the IPSASB's increasing outreach to academics during 2019–2020 and (b) compare the IPSASB's strategies for the period of 2019–2023, with its strategies since the beginning of IPSAS developments in 1996–1997.

A theoretical basis for public sector accrual accounting research: current state and perspectives

ABSTRACTPublic sector or government accounting has been the subject of many research endeavors. However, scholars have repeatedly criticized the lack of a consistent and well-defined theoretical basis for international research. So far, most researchers have drawn from various streams of theoretical perspectives with often unsatisfactory results. The goal of this paper is to put forward the International Public Sector Accounting Standards Board’s (IPSASB) Conceptual Framework as a point of reference for establishing a better-fitting theoretical basis for public sector accrual accounting research.

Participation in the Process of Setting Public Sector Accounting Standards: the Case of IPSASB

Accounting standard-setting bodies employ mechanisms for stakeholder participation in the standard-setting process. While due process procedures of national and international accounting standards boards have been studied in various contexts, the International Public Sector Accounting Standards Board (IPSASB) is a unique organisational body warranting study at a fundamental level. IPSASB has celebrated 20 years of standard setting; however, as a transnational standard setter, the IPSASB lacks determinate authoritative status, and adoption of its standards is quite varied. Given such circumstances, what stakeholders participate in IPSASB’s due process procedures, and in what manner? This paper identifies the stakeholder type, the tone of response, and the geographical origin of respondents submitting comment letters to IPSASB due process documents. Although in principle the effort to develop European Public Sector Accounting Standards (EPSAS) is independent of International Public Sector Accounting Standards (IPSAS), IPSAS have been cited as ‘an indisputable reference’ for the development of EPSAS; thus stakeholder participation in the setting of IPSAS is also relevant to those interested in developing EPSAS.

New development: The IPSASB project on accounting for social benefits—IPSAS 42

ABSTRACTThis article explores the work undertaken by the International Public Sector Accounting Standards Board (IPSASB) in developing IPSAS 42 on ‘Social Benefits’, which was probably the IPSASB’s most challenging project to date. The authors explains IPSAS 42’s approach to liability recognition with the overriding considerations behind the IPSASB’s final decisions. In 2012, the EC identified the lack of a standard on social benefits in the IPSASB’s suite of standards as one of the arguments against the application of IPSASs in the EU, so this article is important in terms of the IPSASs being used as the basis for EPSASs (European Public Sector Accounting Standards).

Stakeholder Participation in the Development of International Public Sector Accounting Standards (IPSAS): A Multi-Issue and Multi-Period Analysis of the Due Process

This article analyses the International Public Sector Accounting Standards Board’s (IPSASB) due process by using a multi-issue and -period analysis of comment letters (CLs) received by the IPSASB (2005-2018). It focuses on respondents’ affiliation and geographic background to assess whether the input received by the IPSASB is (un)representative for its stakeholders. It explores the influence of three variables to explain differences between stakeholders’ participation: IPSAS implementation level, English-proficiency, economic development level. The results evidence that the input is unrepresentative for all its stakeholder, which may influence the IPSASB’s input legitimacy, and complicate further IPSAS implementation. Stakeholders with higher economic development levels and higher IPSAS implementation levels participate more. Additionally, two factors in the due process are analysed to measure their influence on overall stakeholder participation: type of consultation documents, and length of comment periods. Longer comment periods have a positive influence on stakeholder participation.

The Impact of Different Determination of Intangible Fixed Assets in Accordance with CAS and IPSAS on Financial Statements

The paper deals with the determination of intangible assets of Czech public sector. On 15 January 2013, the International Public Sector Accounting Standards Board issued new standard IPSAS 31 - Intangible assets. This standard represents a very sophisticated construction of accounting axioms moving public sector much closer to the private sector. The aim of this paper is to identify and make subsequent comparison of methodological elements in the context of intangible assets according to CAS and IPSAS 31. Moreover the paper tries to show the share of intangible fixed assets to the total assets throughout every type of organization of public sector like regions, municipalities, government departments etc. to assess subsequently the extent of possible impacts on financial situation in case of transition of financial reporting to IPSAS.

Adoption of International Public Sector Accounting Standards in Public Sector of Developing Economies -Analysis of Five South Asian Countries

We examined the extent of adoption of the International Public Sector Accounting Standards (IPSAS) in South Asia and the challenges that are decelerating this process. The moderating organization, International Public Sector Accounting Standards Board (IPSAB), instituted IPSAS in an effort to improve financial reporting by public sector organizations and for comparability purposes. The aims of this research were to establish to what extent the IPSAS has been adopted in South Asia and determine the drawbacks contributing to its slow adoption process. To answer the study questions a literature review of the South Asian countries that have adopted the IPSAS was conducted. The study findings show that most of the South Asian nations have adopted the IPSASs though to different extents. Nepal, Bangladesh, Pakistan and Sri Lanka have implemented the IPSAS but taking different approaches and directions, while India still uses the cash based accounting system. The key barriers include; lack of experienced staff, delay in provision of information by the public entities, and lack of a defined implementation timeframe which seem to cut across these countries.

Accounting for social benefits: The search for a past event

AbstractThe article explains the role of the International Public Sector Accounting Standards Board (IPSASB) in setting accounting standards for the public sector, and the due process that is followed in setting those standards. The article explains the scope of the IPSASB's current project on social benefits, and how this compares to the scope of social benefits in Government Finance Statistics (GFS)/System of National Accounts (SNA) as well as the IPSASB's previous social benefits projects. The scope is wider than pensions, and wider than social security as social assistance is also included. The accounting principles that underpin the IPSASB's current project are discussed and include the IPSASB's definition of a liability, and the key role that a “past event” plays in that definition. This is contrasted with some of the actuarial approaches. The article then describes the potential past events that the IPSASB has considered to date in the project, and what impact liabilities from these past events would have on the financial statements. This comparison makes reference to pensions, where the financial impact of different past events will be greatest. The article sets out the IPSASB's proposals in its recent Exposure Draft ED 63, Social Benefits, and also discusses alternative views on recognition and measurement. The article concludes by discussing the IPSASB's current guidance in RPG 1, Reporting on the Long‐Term Sustainability of an Entity's Finances, and notes that the IPSASB is seeking views on whether it should undertake further work in this area.

Progressive public administration and new public management in public sector accountancy

PurposeThis paper aims to evaluate responses to the International Public Sector Accounting Standards Board’s proposed conceptual framework for evidence of support of new public management doctrines by key stakeholders, namely, accounting professionals, government agencies and international bodies.Design/methodology/approachThe research uses a content analysis of response letters to select phases of the conceptual framework project to identify themes/principles pointing to acceptance or rejection of new public management principles by stakeholders.FindingsAccounting professionals tend to support proposals that are consistent with principles of new public management providing evidence of normative and mimetic isomorphic pressure to align public and private sector accounting practices. Some government agencies and international organisations appear to have conformed but the majority resist efforts to incorporate a new public management discourse in public sector accounting.Research limitations/implicationsThe study is based on a content analysis of publically available response letters. It does not engage directly with respondents. In addition, not all stakeholders have submitted an equal number of response letters, with the result that it was not possible to compare responses from the developed and developing world or according to variations in legal and governance systems.Originality/valueThe study provides empirical evidence of different perspectives of the International Public Sector Accounting Standards Board’s conceptual framework project, which have not been considered explicitly by the previous research. The findings support the view that the accounting profession, as an integral part of the capital market system, exerts pressure to drive standardisation of financialised accounting practices. In contrast, government agencies support accounting systems aligned with conventional accountability principles aligned with jurisdiction-specific contexts. The interaction of these opposing perspectives is a primary determinant of change in accounting practice in the public sector space.

Pension management between financialization and intergenerational solidarity: a socio-economic analysis and a comprehensive model

In recent decades, the management modes of pension obligations have been coevolving with political and financial economic strategies aimed at promoting and favouring active financial markets and institutional investors, as well as transnational harmonization and convergence of accounting standards between private and public sectors. In this context, our article provides a theoretical analysis of these management modes of pension obligations, based on a comprehensive review of existing practice and regulation. The latter are still inconsistent with the individual savings model that has been fostered by international institutions, including the World Bank, the International Monetary Fund and the International Public Sector Accounting Standards (IPSAS) Board. According to our frame of analysis, a variety of viable modes of pension management exists and may be acknowledged. Overcoming the received opposition between defined contribution and defined benefit systems, our approach elaborates a model of pension management with a view to clarifying and improving pension protection, that is, the assurance of continued provision of pension payments at their agreed levels under viable alternative modes of pension management. The definition of financial sustainability depends on the pension management mode that is applied. With the help of this model, we further develop policy recommendations for accounting and prudential regulations concerning pension obligations.

Vymezení konsolidačního celku v rámci veřejného sektoru České republiky a na Slovensku

Příspěvek se zabývá vymezením konsolidačního celku státu v podmínkách České republiky a na Slovensku. Dne 30. ledna 2015 vydala Rada pro mezinárodní standardy pro veřejný sektor nový standard IPSAS 35 - Konsolidovaná účetní závěrka. Tento standard představuje velmi sofistikovanou konstrukci účetních axiomů, která v dané oblasti veřejný sektor výrazně přibližuje sektoru soukromému. Cílem tohoto příspěvku je identifikace a následné porovnání metodických prvků při vymezení konsolidačního celku státu obsažených v české a slovenské národní legislativní úpravě v kontextu se standardem IPSAS 35.