Accounting
Global Accounting Orgs Launch New Govt Accounting Tool for Covid-19 Fiscal Impacts
With more than $9 trillion spent by governments globally on fiscal interventions in the past three months, the effect of the pandemic on public finances will be both immediate and long-lasting.
Jul. 22, 2020
The International Federation of Accountant (IFAC) and the Zurich University of Applied Sciences (ZHAW), in partnership with the International Public Sector Accounting Standards Board (IPSASB), have published a practical accounting tool for governments and other interested stakeholders to help analyze COVID-19 intervention programs.
With more than $9 trillion spent by governments globally on fiscal interventions in the past three months, the effect of the pandemic on public finances will be both immediate and long-lasting. Understanding the design of these interventions, how they are delivered and funded, as well as their impact on the financial position of governments, is critical to manage current challenges and secure sustainable public finances in the future.
“Government accounting is not the first priority that comes to mind when people think about the current pandemic. Yet, there’s evidence that having a comprehensive and well-managed balance sheet supports strong public programs, including for healthcare and economic well-being,” said Alta Prinsloo, IFAC Executive Director.
“It’s never too late for countries to adopt accounting best practices, including accrual-based International Public Sector Accounting Standards (IPSAS), and we hope this guidance will help governments make the case for doing so.” The COVID-19 Intervention Assessment Tool includes:
- A step-by-step process and assessment tool to help assess, evaluate, and inform various types of government interventions related to the pandemic;
- An overview of the pathway to accrual IPSAS for governments.
“By utilizing accrual accounting, governments can gain a more complete understanding of their financial standing and ability to recover from the impacts of the pandemic,” said Andreas Bergmann, Professor of Public Finance at the Zurich University of Applied Sciences (ZHAW).
“This will not be the last time governments will need to act to mitigate an economic crisis and accrual accounting also helps designing economic interventions in a sustainable way.” IFAC and ZHAW remain committed to advocating for, and supporting, strong public financial management in economies globally. This tool is the latest effort to support the adoption and implementation of IPSAS and accrual accounting in the public sector.