| ASB expresses broad support for new lease proposals, calls for guidance on public sector-specific transactions |
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The IPSASB issued a proposed IPSAS on Leases for comment along with a Request For Information on public sector leasing arrangements.
The proposed IPSAS was substantially aligned with IFRS 16 on Leases. There were no specific public sector issues or transactions such as concessionary leases, nominal leases or arrangements to use assets with or without consideration, considered in the proposed IPSAS. The IPSASB requested information on public sector specific arrangements from respondents so that it can assess whether or what guidance is needed in the proposed IPSAS as part of phase 2 of the project.
After consultation with stakeholders locally, the Secretariat of the ASB submitted a comment letter to the IPSASB. There was broad agreement on the alignment of IPSAS with IFRS 16. However, most stakeholders expressed concern about the public sector issues that would seemingly only be addressed as “phase 2” of the project.
In the absence of clear guidance on, for example, concessionary and leases at zero/nominal consideration, inconsistent accounting will continue. Locally, there is no consensus about whether no or low value leases are leases, or whether they are non-exchange transactions related to the use of assets.
The Secretariat will continue to emphasise the importance of issuing a holistic solution for leases with the IPSASB.
Access the ASB’s comment letter here. |
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