Philippine Public Sector Accounting Standard 1

PRESENTATION OF FINANCIAL STATEMENTS

Table of ContentsPAGE Number

BACKGROUND

INTRODUCTION TO THE IPSAS 1

PHILIPPINE APPLICATION GUIDANCE TO IPSAS 1

Objective 1

Scope2

Responsibility for Financial Statements3

Components of Financial Statements4

Consistency of Presentation5

Reporting Period6

Effective Date7

Philippine Public Sector Accounting Standard 1PRESENTATION OF FINANCIAL STATEMENTS

Background

This Philippine Public Sector Accounting Standard (PPSAS) 1 consists of International Public Sector Accounting Standard (IPSAS) 1, Presentation of Financial Statements,, and the Philippine Application Guidance (PAG) prepared to suit the Philippine public sector situation. The IPSAS 1 was issued in May 2000 and revised in December 2006 by the International Public Sector Accounting Standards Board (IPSASB) of the International Federation of Accountants (IFAC). This includes amendments resulting from IPSASs issued up to January 15, 2012. The PAG (in italics) provides supplementary guidance on the proper implementation of IPSAS 1 and also the reason for not adopting some paragraphs of the IPSAS 1.

Introduction to the IPSAS 1IPSAS 1 sets out overall considerations for the presentation of financial statements, guidance for their structure, and minimum requirements for the content of financial statements prepared under the accrual basis of accounting. Philippine Application Guidance to IPSAS 1

Objective

PAG1. Paragraph 1 states the objective of this standard and sets out overall considerations for the presentation of financial statements prepared under the accrual basis of accounting. Generally, the Philippine Public Sector Accounting Standards is on accrual basis except for transactions otherwise accounted for as required by law.Scope

PAG2. Paragraph 5 deals with the applicability of this Standard to all public sector entities other than Government Business Enterprises (GBEs). GBE is an entity that has all the following characteristics: (a) Is an entity with the power to contract in its own name; (b) Has been assigned the financial and operational authority to carry on a business; (c) Sells goods and services, in the normal course of its business, to other entities at a profit or full cost recovery; (d) Is not reliant on continuing government funding to be a going concern (other than purchases of outputs at arms length); and (e) Is controlled by a public sector entity. This standard shall be applied to all National Government Agencies (NGAs), Local Government Units (LGUs) and Government-Owned and/or Controlled Corporations (GOCCs) not considered as GBEs. Responsibility for Financial Statements

PAG3. Paragraphs 19-20 deal with identification of responsible officers for the preparation and presentation of the agencies financial statements. The responsibility for the fair presentation and reliability of financial statements rests with the management of the reporting agency, particularly the head of finance/accounting office and the head of agency or his authorized representative. Components of Financial StatementsPAG4. Paragraph 21 requires an entity that makes publicly available its approved budget, to prepare a comparison of budget and actual amounts either as a separate additional financial statement or as a budget column in the financial statements. A separate additional financial statement for comparison of budget and actual amounts shall be prepared since the financial statements and budget of NGAs, LGUs and GOCCs not considered as GBEs are not on the same accounting basis. Consistency of Presentation

PAG5. Paragraphs 43 and 44 pertain to changes in the presentation of entitys financial statements if the changed presentation provides information that is reliable and is more relevant to users of the financial statements. The cases cited in these paragraphs shall not be adopted.

Reporting PeriodPAG6. Paragraph 67 pertains to cases when entities might change its reporting date. This is not applicable since the reporting date is fixed for all entities. Effective DatePAG7. This PPSAS shall apply for annual financial statements covering periods beginning January 1, 2014. Public Sector Auditing Standards Board

(PSSB Auditing)

PPSAS 1 Presentation of Financial StatementsPage 1 January 2014