Accounting Standards Board
The accounting standards board (ASB) has published a notice in the Government Gazette calling for comment on two exposure drafts.
The ASB is responsible for developing and maintaining financial reporting standards within the public sector.
It seeks to ensure that the standards it draws up are easily understandable within the national, provincial and local spheres of government.
The standards must conform with the standards of generally recognised accounting practice (GRAP).
The two exposure drafts are:
• ED 94 proposed GRAP reporting framework for 2012/13 and amendments to directive 5
• ED 95 proposed amendments to the interpretation of the standard of GRAP applying the probability test on initial recognition of exchange revenue (IGRAP1)
According to the ASB, comment received forms an integral part of the standard setting process.
In terms of ED 94, the reporting framework would apply after 1 April 2012.
The proposed reporting framework will determine how public entities must prepare their financial statements. The framework is revised on an annual basis.
Written comment is invited until 15 February 2012.
As regards ED 95, the proposed amendments, if approved, will replace IGRAP1that was issued in 2009.
The amendments are necessary due to the coming into effect of the standard of GRAP on revenue from non-exchange transactions on 1 April 2012.
The ASB felt that the principles in IGRAP1 should be extended to non-exchange transactions.
“This is to ensure that the probability test on initial recognition of exchange and non-exchange revenue is applied consistently”.
The exposure draft outlines amendments to IGRAP1 that will allow it to recognise non-exchange revenue.
Written comment is invited until 15 May 2012.
Sabinet Cape Town Office
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