Exposure Draft 88, Arrangements Conveying Rights over Assets

(Amendments to IPSAS 47 and IPSAS 48)

The International Public Sector Accounting Standards Board (IPSASB) has issued the Exposure Draft Arrangements Conveying Rights over Assets (Amendments to IPSAS 47 and IPSAS 48).

The proposals are intended to provide guidance on accounting for the concessionary component of concessionary leases and other arrangements which convey rights over assets such as access rights, and shared properties.

About this consultation

Concessionary leases and other arrangements conveying rights over assets are common in the public sector. This Exposure Draft is part of the ongoing IPSASB project on leases and other “lease-like arrangements”.

This ED transposes the revenue accounting requirements in IPSASB ED 84 to the recently issued IPSAS 47 Revenue which supersedes IPSAS 23 Revenue from non-exchange transactions. It also provides guidance and examples on accounting for other arrangements conveying rights over assets not previously addressed by ED 84.  

The ED proposes amendments to IPSAS 47 to:

  • measure the concession in concessionary leases and right-of-use assets in-kind as the difference between the present value of payments for the lease at market rates based on the current use of the underlying asset and the present value of contractual payments;
  • recognise revenue for the concession component in a concessionary lease immediately, except if a compliance obligation exists. Where a compliance obligation exists, to recognise a liability and reduce it as the compliance obligation is satisfied;
  • require entities to identify, recognise, and measure right-of-use assets in-kind applying the principles in IPSAS 43 Leases, with the necessary adaptations in the absence of lease payments;
  • provide illustrative examples on the accounting for access rights, arrangements allowing the right to use an asset, and shared properties in IPSAS 47.

It also proposes amendments to IPSAS 48 Transfer Expenses to include non-authoritative guidance on accounting for right-of-use assets in-kind without consideration in accordance with that standard.

Please note: In New Zealand, currently there are currently no PBE Standard based on IPSAS 43, IPSAS 47, or IPSAS 48. PBE Standards based on IPSAS 47 and IPSAS 48 are currently under development along with a Standard based on IPSAS 43 for public sector PBEs.

Accessing the Exposure Draft

Read the full Exposure Draft here.

We also encourage you to view the IPSASB’s introductory video and at-a-glance summary of the Exposure Draft proposals.

How to provide feedback

Please send us your comments — both formal and informal– by using the form below or emailing us at accounting@xrb.govt.nz

Comments must be submitted by 17 May 2024.

Comments can also be made directly to the IPSASB by 31 May 2024, by clicking here.  

If submitting directly, please send a copy of your submission to accounting@xrb.govt.nz 

This consultation has now closed. Submissions to the XRB closed on 17 May 2024. Submissions to the IPSASB closed on 31 May 2024.

No submissions were received.