Key standards for IFMS implementation

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Key standards for IFMS implementation Andy Wynne
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Key standards and guidance for implementing an
IFMS

• PEFA
• Government Financial Statistics
• IPSAS
• Treasury Reference Model
• COBIT
• ISO 27001

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Public Expenditure and Financial Accountability
(PEFA)
PI-5 Classification of the budget PI-6
Comprehensiveness of information included in
budget documentation PI-24 Quality and
timeliness of in-year budget reports PI-25
Quality and timeliness of annual financial
statements
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PI-5 Classification of the budget
The budget formulation and execution is based on
administrative, economic and sub-functional
classification, using GFS/COFOG standards
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PI-6 Comprehensiveness of information included
in budget documentation
1. Macro-economic assumptions 2. Fiscal
deficit 3. Deficit financing 4. Debt stock 5.
Financial Assets 6. Prior years budget outturn
7. Current years budget 8. Summarized budget
data for both revenue and expenditure 9.
Explanation of budget implications of new policy
initiatives.
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PI-24. Quality and timeliness of in-year budget
reports
(i) Classification of data allows direct
comparison to the original budget. Expenditure is
covered at both commitment and payment stages.
(ii) Reports are prepared quarterly and issued
within 4 weeks of end of period. (iii) There
are no material concerns regarding data accuracy.
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PI-25. Quality and timeliness of annual financial
statements
(i) A consolidated government statement is
prepared annually (ii) The statement is
submitted for external audit within 6 months of
the year end (iii) IPSAS or corresponding
national standards are applied for all statements
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Government Finance Statistics Manual

• an accrual-based accounting model
• a set of rules for reporting and aggregating
  financial transactions
• a reporting classification divided into (i)
  government organisations
• (ii) economic categories
• (iii) functions of government
• (iv) programmes

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GFS Economic classification
Compensation of employees Use of goods and
services Consumption of fixed capital Interest
Subsidies Grants Social benefits Other
expenses
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UN Classification of Functions of Government
(COFOG)
General public services Defense Public order and
safety Environmental protection Housing and
community amenities Health Recreation, culture
and religion Education Social protection
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Code of Good Practices on Fiscal Transparency -
IMF
(i) consolidated fiscal position of the central
government should be published (ii) central
government contingent liabilities and tax
expenditures should be published (iii) full
information on the level and composition of debt
and financial assets
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The Public Sector
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International Public Sector Accounting Standards

• suite of standards for the accrual basis
• cash basis IPSAS

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Cash Basis IPSAS
(a) a statement of cash receipts and payments
which (i) recognizes all cash receipts, cash
payments and cash balances controlled by the
entity and (ii) separately identifies payments
made by third parties on behalf of the entity
and (b) accounting policies and explanatory
notes
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Consolidated accounts

• Consolidation of
• central government ministries, departments and
  agencies
• parastatal organisations and
• local governments.

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Treasury Reference Model

• designed by World Bank and IMF
• specifically for transitional economies
  with emphasis on control
• aimed at two groups of people
• (a) Government officials planning
  such systems
• (b) software designers and suppliers

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COBIT
Control Objectives for Information and related
Technology (COBIT) Strategic alignment
Value delivery Resource management Risk
management Performance measurement
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ISO 27001 Information Security Management Systems
Specifies the requirements for effective
information security to be certified Risk
management and continual improvement are at its
core Governments are applying this standard to
good effect First of a family of standards to be
released over the next few years
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Conclusions
Great deal of standards and guidance We have
covered the main areas to be considered This
guidance is needed to plan and prepare for the
implementation of an IFMS Keep It Simple!
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Thank you
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Andy Wynne Head of Public Sector Technical Issues
ACCA 29 Lincoln's Inn Fields London WC2A 3EE
United Kingdom tel [phone] fax 44
20 7059 5730 a.wynne_at_accaglobal.com www.
accaglobal.com/publicsector
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Further Guidance 1
PEFA - Public Financial Management Performance
Measurement Framework http//www.pefa.org Govern
ment Financial Statistics Manualhttp//www.imf.or
g/external/pubs/ft/gfs/manual/index.htm Classific
ation of the Functions of Government
http//esa.un.org/unsd/cr/registry/regrt.asp Code
of Good Practices on Fiscal Transparency
http//www.imf.org/external/np/fad/trans/code.htm
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Further Guidance 2
International Public Sector Accounting
Standards http//www.ifac.org/PublicSector/
Treasury Reference Model http//www1.worldbank.o
rg/publicsector/pe/trm.pdf Control Objectives
for Information and related Technology
(COBIT) http//www.isaca.org/cobit ISO 27001
Information Security Management
Systems http//www.iso.org/iso/en/iso9000-14000/un
derstand/index_one.html