As we start this new season, I am delighted to get in touch with you once again and share some highlights from the last month and let you know what to look forward to.
In this edition, I am glad to share our latest animated video announcing the name of the Guidance, take you on a tour of the website, and introduce a flurry of new Country Champions. There is some meaty technical content in two contrasting opinion blogs about when to recognise income from grants and donations that have restrictions or conditions. And we provide the usual updates on events and meetings of the Advisory Groups. The CIPFA team have been working hard to process all their comments and input as we approach the next milestone: the first Exposure Draft, due for release on 21 November 2022 at a session during the World Congress of Accountants in Mumbai.
We are really proud of our new video, revealing that the Guidance being developed by the IFR4NPO project has been given a name. In some cultures, it’s considered premature to give a baby a name before it is born, but we have gone ahead to call it International Non-Profit Accounting Guidance, and even agreed on some of its key features.
INPAG will be stand-alone Guidance so that preparers and auditors can find what they need in one place. Using the IFRS for SMEs Accounting Standard as a starting point, changes will be made to address the prioritized non-profit issues. The application of INPAG will be up to each jurisdiction, but the NPOs we have in mind during the development process need to track assets and liabilities and report on a range of transactions and activities to meet the needs of the users of their financial reports.
The way that non-profits account for grants and donations income is likely to be one of the hottest topics during the development of internationally applicable guidance! Countries with their own national standards have taken different approaches, and many preparers, auditors and users of financial statements also have strong views.
In this pair of blogs, we hear contrasting views from Pesh Framjee in UK and David Hardidge in Australia. There’s some great technical material for you to chew on as you consider your own thoughts about what would be best in a world where we have one harmonized approach.
Please note: we won’t be covering the subject of revenue recognition in the November 2022 Exposure Draft (INPAG ED1), but we do expect to do so in INPAG ED2 in 2023.
- Blog 1 – David Hardidge, published in September 2021
- Blog 2 – Pesh Framjee, published September 2022
You can share your thoughts in our LinkedIn conversation on this topic.
In partnership with our Country Champions around the world, we co-host online meetings to create awareness about different aspects of the IFR4NPO project. These meetings highlight the important role that our international stakeholders play in achieving consistent reporting in the sector. We also run a series of Focus Group Discussions aimed at getting feedback from invited experts on specific subjects.
Please register to attend the events or request an invitation to the Focus Group Discussions. You can also access the recordings and resources from past events by using the link below.
Here’s the feedback from one participant in Colombia:
‘Excellent project and the approach is really comprehensive and complete’.