Abstract:
International Public Sector Accounting Standards (IPSAS) have gained worldwide
acceptance and acclaim as an accounting and reporting framework as far as public sector
financial reporting is concerned. IPSAS are therefore of interest to public sector accounting in
many jurisdictions and this interest appears to be more and surging in the developing
economies of the world, including the African region. As empirical evidence suggest that
many countries are desirous of adopting these IPSAS, an in-depth exposition of the benefits
and associated challenges of the framework could help the transitioning process in diverse
ways. For instance, adopting countries could learn from examples, experiences and best
practices as evidenced in extant literature. This concept paper therefore examines the benefits
and challenges of IPSAS with particular focus on the African region. It also assesses the
mechanisms for addressing the challenges so that the full benefits ascribed to the IPSAS
accounting and reporting regime could be realised. The paper first explains the fundamental
principles underlying IPSAS, followed by a discussion of the benefits and challenges in
transitioning to IPSAS in general, and by African governments in particular. Cash and
accrual IPSAS are examined and the status of IPSAS adoption by African countries
discussed. It then explains and proposes the approach African governments may use to
effectively transition to IPSAS. The paper concludes with recommendations to guide the
effective transition to IPSAS.
