IPSASB Measurement EDs Summary
Here is a quick outline of the four measurement-related EDs issued by the IPSASB and why you might be interested in them.
Summary of the IPSASB Measurement EDs
Conceptual Framework Update: Chapter 7, Measurement of Assets and Liabilities in Financial Statements
ED 76 proposes to update the measurement bases described in Chapter 7 of the IPSASB Conceptual Framework. Measurement bases are the approaches to measuring assets and liabilities.
ED 76 proposes to:
Who should read ED 76?
In most cases entities can apply standards without having to read the Conceptual Framework.
Read ED 76 if you:
ED 77 proposes to create a new IPSAS which explains how to apply the measurement bases required by standards to assets and liabilities. ED 77 describes four measurement bases:
ED 77 reflects the changes to the Conceptual Framework set out in ED 76.
Who should read ED 77?
Read ED 77 (and ED 78) if you:
Property, Plant and Equipment
ED 78 proposes to update IPSAS 17 Property, Plant and Equipment and bring in new requirements for revalued assets. Currently entities revaluing property, plant and equipment are required to use fair value. The ED would require entities revaluing such assets to choose either fair value or current operational value (COV), based on the entity’s primary purpose for holding the assets.
Fair value would be defined the same way as fair value in IFRS 13 Fair Value Measurement. Fair value would have an explicit exit price and market participant focus.
COV is a new approach for revaluing assets held with the primary objective of service delivery. Unlike fair value, COV would have an entity-specific focus. The detailed guidance about how to apply COV is set out in ED 77.
ED 78 also proposes some additional guidance on heritage and infrastructure assets.
Who should read ED 78?
Read ED 78 (and ED 77) if:
Non-current Assets Held for Sale and Discontinued Operations
ED 79 proposes a new IPSAS based on IFRS 5 Non-current Assets Held for Sale and Discontinued Operations. Although this would fill a gap in IPSAS, we already have a PBE Standard based on IFRS 5 .
Who should read ED 79?
Read ED 79 if you have applied PBE IFRS 5 Non-current Assets Held for Sale and Discontinued Operations and would like to comment on its requirements.