Experts in the accounting section have hinted that the major issue faced by the Economic Community of West African States, (ECOWAS) is the lack of uniformity in the International Public Sector Accounting Standard, IPSAS.
Deputy Director, Centre for Entrepreneurship Studies, University of Abuja, Dr. James Adefiranye, stated during his presentation at the Joint Committee meeting on Public Accounts, Administration, Finance and Budget, Macroeconomic Policies and Economic Research, Trade, Customs, and Free Movement, in Lome, Togo.
He said evidence has shown that a lack of implementation of the IPSAS has led to the late preparation of financial statements that could lead to proper auditing of reports within the member states.
Stressing that changing government accounting systems by countries requires the implementation and operationalization of IPSAS for content-driven, thus urging the parliament to step up its system to meet the people’s aspiration for good governance.
“Compliance with International Public Sector Accounting Standard
“Cash basis entails that, activities should be reported when cash is received. That means, if we have an activity or function for the year 2020 and we did not release the cash until 2022, we will not talk about it until 2022, even though we have the access. It’s not ideal, that’s why IPSAS is saying no, let’s do it the way it’s done in the very sector; when we receive an item, we convert the liability, we report it that year, that is what is accural basis.”
Speaking further, Dr. James noted that adopting the IPSAS would greatly help ECOWAS member states move forward in dealing with their financial statements and reports, adding that non-uniformity by member states would likely affect the activities of the ECOWAS.
“For example, when ECOWAS report is strictly on IPSAS accural basis, and the local communities have another system.
When you send your report, the government of such States will have to delay in accepting your reports, because, they are doing it according to the cash basis they are used to, then it looks strange or questionable.
“To make this a reality, this Body, this Institution should know that there should be conscious efforts made towards assisting community institutions in addressing the obstacles and other challenges that are militating against the full adoption of IPSAS.
We can make efforts to encourage the local communities.
Almost all states in ECOWAS have tilted towards IPSAS, but encountering challenges in the area of implementation.”
Dr. James believes achieving a near-perfect, transparency and accountability in ECOWAS states will propel member states to adopt and apply the use of IPSAS, hence the need to carefully study the outcome of the audit management letters and identify areas of concern for scrutiny.
