The Financial
Reporting Advisory Board (FRAB) today published its 12 th annual
report, which highlights that satisfactory progress has been made
to date by government departments in implementing the Treasury’s
trigger point strategy for the application of EU adopted
international financial reporting standards, from 2009-10.
In its 2008 report the FRAB highlighted the need for government
departments to ensure that they are prepared for the introduction
of international financial reporting standards (IFRS), and warned
that the implementation of IFRS, scheduled for 2009-10, should not
be permitted to slip.
Commenting on the report, Chairman Elwyn Eilledge CBE, said:
“The implementation of IFRS is challenging, but the Board is
pleased to note that the implementation of the Treasury’s trigger
point strategy by departments is beginning to show satisfactory
results. At this stage in preparations, satisfactory progress has
been made in the first two trigger points, and the project remains
on track for meeting the 2009-10 timetable. The production of
‘shadow’ IFRS based resource accounts for 2008-09 by departments
represents the next key milestone in their preparation for the
transition to IFRS. The shadow accounts will be subject to audit
procedures.
The FRAB is particularly pleased to note that the Treasury has
introduced additional corporate governance arrangements, involving
Board representation, to oversee the final stages of the adoption
of IFRS. The FRAB is encouraged by the progress made over the last
year and will continue to monitor this project, offering its
advice to the Treasury as required on any remaining IFRS issues,
to ensure the 2009-10 timetable is achieved.”
The Board also reports that it has agreed the extension of its
remit to include oversight of the Code of Practice on Local
Authority Accounting in the United Kingdom, with effect from
2010-2011, when local authorities complete the move to IFRS-based
financial reporting. The Board has made a number of changes to its
terms of reference and membership to reflect this extension in the
scope of its responsibilities.
The report acknowledges the Treasury’s efforts on ongoing issues
of interest to the Board, in particular its work on the Alignment project.
The FRAB reports that the alignment proposals, agreed in
principle by the Board, seek to improve the alignment of budgets,
Estimates and resource accounts. These include a proposal to
introduce changes to the departmental resource accounting boundary
that will generally result in the consolidation of Executive
non-departmental public bodies, which is something the Board has
encouraged in previous reports.
Looking ahead, the Board expects to consider publications issued
by the International Accounting Standards Board (IASB) and the
International Public Sector Accounting Standards Board that may
impact on future public sector accounting.
The report is available to download from: <http://www.hm-treasury.gov.uk/psr_reporting_statistics_frabreports.htm>