Interpretation and Application of IPSAS

Annex 2: Key Characteristics of Public Sector Entities¹

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Characteristic	Description
Public accountability	Governments are elected through a democratic process to be granted constitutional or devolved rights, powers, and responsibilities. These responsibilities require broad accountability to the public and their elected representatives. Government and their institutions use public resources and may have been given delegated powers and responsibilities that also demand broad accountability to the public. Public accountability is an overriding feature of public sector entities and ensuring the availability of information to demonstrate such accountability is the primary objective of public sector reporting. Public accountability typically encompasses: A conferred responsibility; An obligation to report back on the discharge of that responsibility; Monitoring to warrant accountability; and Potential sanctions for non-performance.
Multiple objectives	The key aims of most public sector entities are not to generate a profit. Instead they are to: Provide service; Facilitate resource reallocation; and/or Undertake policy development.
Rights and responsibilities	The rights and responsibilities of governments provide them with the ability to directly and indirectly affect the economy and society they operate in. The rights and responsibilities may vary by level of government. Governments can, for example: Tax and set fiscal policy; Penalize and fine; Set monetary ...