Philippine Public Sector Accounting Standard 1

PRESENTATION OF FINANCIAL STATEMENTS

Table of Contents
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BACKGROUND
INTRODUCTION TO THE IPSAS 1
PHILIPPINE APPLICATION GUIDANCE TO IPSAS 1
Objective

Scope

Responsibility for Financial Statements

Components of Financial Statements

Consistency of Presentation

Reporting Period

Effective Date

PPSAS 1 Presentation of Financial StatementsPage 1

January 2014

Philippine Public Sector Accounting Standard 1

PRESENTATION 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 1
IPSAS 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
PPSAS 1 Presentation of Financial StatementsPage 2
January 2014

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 Statements
PAG4.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 Period
PAG6.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.
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January 2014

Effective Date
PAG7.This PPSAS shall apply for annual financial statements covering
periods beginning January 1, 2014.

Public Sector Auditing Standards

Board
PPSAS 1 Presentation of Financial StatementsPage 4
(PSSB Auditing)
January 2014