IPSAS Explained: A Summary of International Public Sector Accounting Standards, 2nd Edition

IPSAS 32: Service Concession Arrangements: Grantor

Objective

IPSAS 32 establishes the accounting and reporting requirements for the grantor in a service concession arrangement. In these kinds of arrangements the grantor is a public sector entity. Service concession arrangements in the public sector are characterized by binding arrangements that involve private sector participation in the development, financing, operation and/or maintenance of assets used to provide public services. IPSAS 32 intention is to create symmetry with IFRIC 12 on relevant accounting issues (i.e., liabilities, revenues, and expenses) from the grantor's point of view.

The IFRS on which the IPSAS is based

IPSAS 32 is a public sector specific standard. Nevertheless, it is intended to “mirror” IFRIC Interpretation 12, Service Concession Arrangements. IFRIC 12 sets out the accounting requirements for the private sector operator in a service concession arrangement. Here, the operator is a private sector entity. IPSAS 32 also contains extracts from SIC Interpretation 29, Service Concession Arrangements: Disclosures.

Content

Principal definitions

A service concession arrangement can be described as a “public private partnership” that contains an asset as well as a service component. IPSAS 32 defines a service concession arrangement as ”… a binding arrangement between a grantor and an operator in which:

a) The operator uses the service concession asset to provide a public service on behalf of the grantor for a ...