IPSAS 33 gives an entity adopting accrual basis IPSAS for the first time a transition period of up to three years during which it may apply certain exemptions that may affect achieving full fair presentation, before it can make an explicit and unreserved statement of compliance with IPSAS.

What Is the Objective of IPSAS 33?

The Standard states that "the objective of this Standard is to ensure that an entity's International Public Sector Accounting Standards (IPSAS) financial statements contain high-quality information that: (a) Is transparent for accountability and decision-making purposes." The aim is to provide a sound starting point for accounting under the accrual basis.

When Does Application of This Standard Begin for a Given Entity?

The Standard states that "a first-time adopter shall apply this Standard from the date on which it adopts accrual basis IPSAS Standards and prepares and presents its first financial statements after the date of adoption of IPSAS." This means the Standard's scope is limited to the moment of transition to the accrual basis, not to subsequent changes in accounting policies of an entity already applying IPSAS. The Standard defines a "first-time adopter" as "an entity that adopts accrual basis IPSAS Standards for the first time."

What Is the Opening Statement of Financial Position and Why Does It Matter?

The Standard defines the "opening statement of financial position" as "a first-time adopter's statement of financial position at the date of adoption of IPSAS Standards," and requires the entity to prepare it, stating that "a first-time adopter shall prepare and present an opening statement of financial position at the date of adoption of IPSAS. This is the starting point for its accounting in accordance with accrual basis IPSAS." This statement is therefore the foundation on which all of the entity's subsequent financial statements are built after its move to the accrual basis.

How Long Can the Transition Period Last?

The Standard states that "this Standard permits a first-time adopter to apply transitional exemptions and provisions, for a transition period of up to three years, that may impact fair presentation during the transition period." During this period, the entity cannot include in its financial statements an explicit and unreserved statement of full compliance with IPSAS until those exemptions have expired. The Standard defines "transitional IPSAS financial statements" as "the financial statements prepared in accordance with this Standard where a first-time adopter cannot make an explicit and unreserved statement of compliance with accrual basis IPSAS Standards because it adopted one or more of the transitional exemptions in this Standard."

When Does the 2025 Edition of the Standard Become Mandatory?

The Standard states that "a first-time adopter shall apply this Standard if its first IPSAS financial statements or its first transitional financial statements are for a period beginning on or after January 1, 2028. Earlier application is permitted."

What About the Earlier 2015 Edition of IPSAS 33?

The 2025 edition states that "this Standard supersedes IPSAS 33, First-time Adoption of Accrual Basis International Public Sector Accounting Standards (IPSAS), issued in 2015. IPSAS 33 issued in 2015 remains applicable until this Standard is applied or becomes effective, whichever is earlier." This means entities adopting the accrual basis before the new edition takes effect continue to rely on the 2015 edition of the Standard.

Legal References

For questions about your specific situation, you can ask the Public Sector Accounting Helper on Helpers, or consult a licensed chartered accountant.