Ministry of Primary and Secondary Education

Harare Province
IPSAS IMPLEMENTATION TRAINING
2024
 IPSAS 1

Presentation of
Financial Statements
 OBJECTIVES
• To prescribe the manner in
• To set out overall considerations
which general purpose
financial statements should be for the presentation of financial
presented to ensure statements, guidance for their
comparability both with the
entity’s financial statements of structure, and minimum
previous periods and with the requirements for the content of
financial statements of other
entities financial statements prepared
under the accrual basis of
accounting.
3
 SCOPE
Standard sets out overall considerations for the presentation
of financial statements, guidance for their structure, and
minimum requirements for the content of financial
statements prepared under the accrual basis of accounting

4
 DEFINITIONS

1. Accrual basis

A basis of accounting under which transactions and other events are recognized when they
occur (and not only when cash or its equivalent is received or paid).

2. Expenses
Decreases in economic benefits or service potential during the reporting period in the form
of outflows or consumption of assets or incurrences of liabilities that result in decreases in
net assets/equity, other than those relating to distributions to owners
 DEFINITIONS CONT…….

3. Material
 Omissions or misstatements of items are material if they could, individually or
collectively, influence the decisions or assessments of users made on the basis of the
financial statements.
 Materiality depends on the nature and size of the omission or misstatement judged in the
surrounding circumstances.
 The nature or size of the item, or a combination of both, could be the determining actor.

6
 DEFINITIONS CONT….

4. Revenue
Gross inflow of economic benefits or service potential during the reporting period when those
inflows result in an increase in net assets/equity, other than increases relating to contributions
from owners.

5. Notes
 Contain information in addition to that presented in the statement of financial position,
statement of financial performance, statement of changes in net assets/equity and cash flow
statement.
 Notes provide narrative descriptions or disaggregation of items disclosed in those statements
7
and information about items that do not qualify for recognition in those statements.
 Information provided by IPSAS 1

Assets
Liabilities
Income
Expenditure
Net Assets
IPSAS 1 8
 Purpose of Financial Statements

 To provide information about the financial position, financial performance, and cash flows of an entity that
is useful to a wide range of users in making and evaluating decisions about the allocation of resources.

 Providing information about the sources, allocation, and uses of financial resources;

 Providing information about how the entity financed its activities and met its cash requirements;

 Providing information that is useful in evaluating the entity’s ability to

 finance its activities and to meet its liabilities and commitments;

IPSAS 1 9
 Principles
Consistency Materiality Aggregation Offsetting

Comparativ Going
Timeliness
e Concern

10
Consistency
• There must be Consistency of presentation and classification of items
from one period to the next and can only be changed when it is a result
of;
• a) a significant change in the nature of the undertaking’s operations;
• b) identification of a more appropriate presentation; or
• c) the requirements of a new IPSAS.
Materiality
Each material class of similar items must be presented separately in the
financial statements
Aggregation
Dissimilar items may be aggregated only if they are individually
immaterial.
11
Offsetting
Assets and liabilities, and income and expenses, shall not be offset unless
required (or permitted) by a Standard.
Comparative Information
• Required for previous period for all amounts reported
• Included for narrative and descriptive information when relevant to
understanding
Going Concern
When preparing financial statements, management must make an assessment
of an undertaking’s ability to continue as a going concern
Timeliness
The usefulness of financial statements is impaired if they are not made
available to users within a reasonable period after the reporting date
12
 Components of Financial Statements

• (a) A statement of financial position;

• (b) A statement of financial performance;

• (c) A statement of changes in net assets/equity;

• (d) A cash flow statement;

• (e) When the entity makes publicly available its approved budget, a comparison of budget and actual amounts
either as a separate additional financial statement or as a budget column in the financial statements; and

• (f) Notes, comprising a summary of significant accounting policies and other explanatory notes.

• (g) Comparative information in respect of the preceeding period as specified in paragraph 53 13

• The financial reporting period for all reporting entities shall be 1 January to 31 December of each year

• Financial statements shall be presented at least annually. The reporting entity shall present financial

statements within the timelines the Public Financial Management Act(22:19).

Presentation title 15
 Disclosure
• IPSAS 1 requires that entities present a summary of accounting policies which will disclose
the measurement basis used in preparing financial statements and all other accounting
policies that are significant to the understanding of the financial statements. Entities should
only disclose accounting policies only for items in their financial statements.
• In presenting the notes, the following structure of notes shall be followed by reporting
entities :
a. Corporate information
b. Significant accounting policies
I. Basis of preparation
II. Basis of Consolidation.
III. Summary of significant accounting policies
IV. Changes in accounting policies and disclosures
V. Correction of an error. 16
 Presenter:
Thank you
Sir Dikaz