- 3 Marks
PSA – Nov 2024 – L2 – Q4c – Events After the Reporting Date
Explanation of events occurring after the reporting date and their impact on financial statements.
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Topic: General purpose financial reporting framework
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+ past questions and counting.
- 4 Marks
PSAF – Nov 2016 – L2 – Q4c – General purpose financial reporting framework
Explains the challenges faced if public sector accounts are not classified.
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- Tags: accounting classification, Challenges, Financial Reporting, Ghana, Public Sector
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2016
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- 4 Marks
PSAF – Nov 2016 – L2 – Q5b – General purpose financial reporting framework,
Identify four major disclosures required in the general government sector's financial statements.
Question
IPSAS 1 Presentation of Financial Statements identifies a complete set of financial statements (under the accrual basis) as a statement of financial position, statement of financial performance, statement of changes in net assets/equity, cash flow statement, and accounting policies and notes to the financial statement.Required:
Identify four major disclosures that must be made in respect of the general government sector in the preparation of financial statements. (4 marks)
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- Tags: Disclosures, Financial Statements, ICAG, Professional Level 2
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2016
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- 5 Marks
PSAF – Nov 2020 – L2 – Q5d – General purpose financial reporting framework
Discuss four matters that information in General-Purpose Financial Reports (GPFR) helps primary users assess.
Question
Financial Reporting is not an end in itself. Its usefulness is by reference to the users of General-Purpose Financial Reports (GPFR) and their information needs. Until the information provided meets the information needs of the users, that information is worthless. Thus, accountants must be knowledgeable of the class of users of the information and the need for such information. The Conceptual Framework identifies the primary users whose information needs should be paramount in the preparation of GPFR.
Required:
Discuss FOUR (4) matters that the information provided in a GPFR helps primary users to assess an entity. (5 marks)
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- Tags: Financial Reporting, GPFR, Public Sector Accounting
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2020
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- 10 Marks
PSAF – July 2023 – L2 – Q1b – General purpose financial reporting framework
Provide briefing notes on qualitative characteristics, measurement bases, and the statutory role of internal auditors in public sector financial reporting.
Question
You are the Head of Finance of Public Sector Reform Secretariat, Office of the President. You have received the following e-mail from the Chief Executive Officer.
Email:
“Dear Head of Finance,
I have been invited by the Office of Head of Civil Service to attend a seminar on the theme ‘Fundamentals of Public Financial Reporting’. Among the topics listed for discussion are the following:
- Qualitative Characteristics of Financial Information.
- The Bases of Measurement of Public Sector Assets.
- The Statutory Roles of Internal Auditors of Public Sector Entities.
I am aware of your expertise in public financial management and will greatly appreciate it if you could prepare some briefing notes for me to bridge my knowledge gap prior to the conference.”
Required:
As Head of Finance and a recipient of the e-mail, provide your response in a memo to the Chief Executive Officer.
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- 9 Marks
PSAF – Nov 2020 – L2 – Q1c – General purpose financial reporting framework
This question discusses various measurement bases used in public sector financial reporting and their impact on reflecting the cost of service, operational capacity, and financial capacity.
Question
According to the Conceptual Framework for General Purpose Financial Reports (GPFR), the objective of measurement in financial reporting in public sector entities is to select those measurement bases that most fairly reflect the cost of services, operational capacity, and financial capacity of the entity in a manner that is useful for accountability and decision-making purposes.
Required: Explain the under listed bases and discuss the extent to which each measurement reflects the cost of service, operational capacity, and financial capacity of an entity.
i) Historical cost
ii) Market Value
iii) Replacement cost
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- Tags: Historical Cost, Market Value, Measurement Bases, Public Sector, Replacement cost
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2020
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- 5 Marks
PSAF – Nov 2020 – L2 – Q1b – General purpose financial reporting framework
This question explains the difference between general-purpose and special-purpose financial reports.
Question
In line with the Conceptual Framework for General Purpose Financial Reporting by Public Sector Entities issued by the International Public Sector Accounting Standards Board (IPSASB), explain the difference, if any, between a General-Purpose Financial Report and a Special-Purpose Financial Report.
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- Tags: Financial Reporting, IPSAS, Public Sector, Special-Purpose Reports
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2020
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- 4 Marks
PSAF – May 2017 – L2 – Q4b – General purpose financial reporting framework
This question explains the qualitative characteristics that the financial statement may lack.
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- 4 Marks
PSAF – May 2017 – L2 – Q3b – General purpose financial reporting framework
This question identifies characteristics of Government Business Enterprises (GBEs) as defined by IPSAS 1 for determining appropriate financial reporting standards.
Question
Public sector entities are required to present financial reports in compliance with the International Public Sector Accounting Standards (IPSAS). However, Government Business Enterprises (GBEs) are to present the financial reports using IFRS due to their peculiar characteristics that separate them from other public sector entities.
In determining whether an entity is a GBE for financial report purposes, one must examine their nature and characteristic rather than the legal form. In the entity you work for, there is controversy among top management about whether to use IPSAS or IFRS.
Required: Identify FOUR characteristics of GBEs in accordance with IPSAS 1, Presentation of Financial Statements. (4 marks)
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- Tags: GBEs, Government Business Enterprises, IFRS, IPSAS, Public Sector Reporting
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: MAY 2017
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- 10 Marks
PSAF – Nov 2023 – L2 – Q1b -General purpose financial reporting framework
Analyze the impact of specific financial reporting scenarios on qualitative characteristics of financial statements.
Question
The following revelations were made about the financial reporting process of a covered entity:
i) The users of the financial statements of the entity is less interested in the financial information because it does not provide information that enables the users to either confirm their expectation or make predictions.
ii) Equipment purchased during the year was recognized as an expense in the statement of financial performance, even though the entity applies the accrual principles.
iii) A revenue transaction of a significant value was completely omitted from the financial statement of the entity unintentionally.
iv) The financial statements showed the budget amounts alongside the actual amounts of the year in the Statement of Financial Performance.
v) The Accountant confirmed that some records relating to expenses were done based on WhatsApp messages (online texting app) from the Principal Spending Officer.
Required: Explain how each of the transactions (i) to (v) would affect a specific qualitative characteristic of the financial statements of the entity. (10 marks)
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- Tags: Application, Financial Reporting, Public Sector, Qualitative Characteristics
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2023
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- 10 Marks
PSAF – Nov 2023 – L2 – Q1a – General purpose financial reporting framework
Redraft financial statement under cash basis and justify its use.
Question
| Revenue | GH₵ | GH₵ | |
|---|---|---|---|
| GOG Subvention | 152,000 | ||
| Internally Generated Fund (IGF) | 1 | 187,000 | |
| Donations | 4 | 45,000 | 384,000 |
Expenditure
| Description | GH₵ | GH₵ | |
|---|---|---|---|
| Compensation | 2 | 68,000 | |
| Use of Goods & Services | 3 & 5 | 35,000 | |
| Consumption of Fixed Asset | 13,000 | (116,000) | |
| Surplus | 268,000 |
Additional Information:
- The entity received an IGF of GH¢ 13,000 in advance for the year 2023. This transaction is not included in the IGF amount stated in the financial statement.
- Included in Compensation is an amount of GH¢ 17,000 accrued as at the end of 31 December 2022.
- Excluded from the Use of Goods & Services is an amount of GH¢ 1,000 paid in advance for the year 2023.
- Included in Donations is Motor Vehicle received from a donor partner amounting to GH¢ 12,000.
- Included in the Use of Goods and Services is Furniture acquired on 31 December 2022 at the cost of GH¢ 2,000.
- The Statement of Financial Performance is prepared under Accrual Accounting Basis.
Required:
i) Redraft the financial statement under Cash Accounting Basis for the year ended 31 December 2022, showing the necessary adjustments. (7 marks)
ii) Justify THREE (3) reasons management would want to prepare the financial statement under Cash Accounting Basis. (3 marks)
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- Tags: Adjustments, Cash Basis, Financial Statement
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2023
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- 6 Marks
PSAF – Nov 2019 – L2 – Q2b -General purpose financial reporting framework
Discuss the guiding principles for formulating accounting policies, conditions for changes, and treatment of changes under IPSAS 3.
Question
b) With reference to IPSAS 3: Accounting Policies, Changes in Estimates and Errors:
i) Explain the guiding principles for formulating accounting policy. (2 marks)
ii) The conditions that mandate a change in accounting policy. (2 marks)
iii) The treatment of changes in accounting policy required by IPSAS 3. (2 marks)
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- Tags: Accounting Policies, Changes in Estimates, Errors, IPSAS 3, Public Sector
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2019
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- 4 Marks
PSAF – Nov 2019 – L2 – Q1a – General purpose financial reporting framework
Explain the importance and content of notes to the financial statements for a public sector entity.
Question
An Accounting Trainee has been given an assignment to prepare a complete set of financial statements of a public sector entity from data set provided by the Director of Finance. The Trainee prepared the financial statements to the admiration of the Director, except that no notes to the financial statements were provided. The Director made him aware that the notes to the financial statements are an essential component of the financial statements whether applying the cash basis of accounting or accrual basis of accounting as it enhances the usefulness of the financial reports to users. The Trainee has been directed to you to educate him further on the relevance of notes to the financial statements.
Required:
Write out your explanatory notes to the Trainee, the usefulness of notes to the financial statements, and the information that should be included in the notes to the financial statements of a public sector entity. (4 marks)
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- Tags: Financial Statements, IPSAS, Notes, Public Sector
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2019
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- 4 Marks
PSAF – Nov 2017 – L2 – Q1b – General Purpose Financial Reporting Framework
Discuss the qualitative characteristics of financial statements that MMDAs fall short of according to IPSAS 1.
Question
The Public Accounts Committee of Parliament has bemoaned the state of financial reporting in the Metropolitan, Municipal and District Assemblies (MMDAs). According to the Chairman, the financial statements fall short of confirmatory and predictive value. In fact, the financial statements are characterized by errors, omissions, and misstatements, and as if this is not enough, the final reports are approved at a later year. The citizens also complain seriously about their inability to appreciate the information reported, robbing them of their right to assess the accountability of the government.
Required:
Explain FOUR qualitative characteristics that the final reports of MMDAs fall short of in accordance with IPSAS 1: Presentation of Financial Statements. (4 marks)
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- Tags: Financial Reporting, IPSAS, MMDAs, Qualitative Characteristics
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2017
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- 4 Marks
PSAF – Dec 2023 – L2 – Q5c – General purpose financial reporting framework
Explain constraints on the information included in General-Purpose Financial Reports.
Question
Many individuals with an interest in the performance of a public entity do not have the power to require the entity to produce customized financial or performance information. Instead, they rely on the General-Purpose Financial Reports that public entities provide. General-Purpose Financial Reports are designed to provide financial and, where required, performance information to a range of users. To be relevant, the information must meet the accountability and/or decision-making needs of the users.
Required:
Explain TWO (2) constraints on the information included in General-Purpose Financial Reports. (4 marks)
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- Tags: Constraints, Financial Reporting, General Purpose Financial Reports
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: DEC 2023
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- 10 Marks
PSAF – Dec 2023 – L2 – Q1b – General purpose financial reporting framework
Explain five qualitative characteristics that financial statements should satisfy according to IPSAS.
Question
The Financial Statements and budget information presented below were submitted to the Finance and Administration Committee of Ghana Library Authority (GLA) on 30 April 2022 for consideration. The Committee was concerned about the delay in submitting the financial information. They reasoned that it might not be useful for decision-making.
GLA
Statement of Financial Performance for the year ended 31 December 2020
| Item | Actual (GH¢’000) | Budget (GH¢’000) |
|---|---|---|
| Revenues | ||
| GoG Subvention | 170,500 | 152,050 |
| Internally Generated Fund | 58,500 | 93,650 |
| Donations and grants | 17,000 | 12,500 |
| Total Revenues | 246,000 | 258,200 |
| Expenses | ||
| Compensation for employees | 159,200 | 150,000 |
| Use of goods and services | 57,000 | 72,500 |
| Consumption of fixed assets | 6,500 | – |
| Interest | 4,500 | 4,700 |
| Other expenses | – | 3,700 |
| Total Expenses | 227,200 | 230,900 |
| Net operating result | 18,800 | 27,300 |
GLA
Statement of Financial Position as at 31 December 2020
| Item | GH¢’000 |
|---|---|
| Non-Current Assets | |
| Property, plant and equipment | 600,000 |
| Investment | 150,000 |
| Total Non-Current Assets | 750,000 |
| Current Assets | |
| Receivables | 11,500 |
| Cash and Bank | 105,000 |
| Total Current Assets | 116,500 |
| Total Assets | 866,500 |
| Liabilities and Funds | |
| Loans | 450,000 |
| Payables | 53,000 |
| Accumulated fund | 363,500 |
| Total Liabilities and Funds | 866,500 |
Required:
With reference to IPSAS Conceptual Framework, explain FIVE (5) Qualitative Characteristics that the above Financial Statements should have satisfied before it can be considered useful for decision-making and for exercising accountability. (10 marks)
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- Tags: Decision Making, Financial Statements, IPSAS, Qualitative Characteristics
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: DEC 2023
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- 5 Marks
PSAF – Nov 2021 – L2 – Q5c – General purpose financial reporting framework
Discuss how general-purpose financial reporting supports accountability and decision-making in the public sector.
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- 10 Marks
PSAF – Nov 2021 – L2 – Q1b – General purpose financial reporting framework
Explain the information needs of primary users in GPFR and discuss why not every public sector entity is a reporting entity.
Question
General purpose financial reporting is concerned with the provision of information to users for accountability and decision-making purposes. It is said that financial reporting is not an end in itself but a means to an end. However, this does not mean that every public sector entity is a reporting entity.
Required:
i) In reference to the Conceptual Framework of General Purpose Financial Reporting, explain the information needs of FIVE (5) primary users of general purpose financial reports.
(7 marks)
ii) Discuss the statement “This does not mean that every public sector entity is a reporting entity.”
(3 marks)
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- Tags: GPFR, Information Needs, Primary Users, Public Sector Accounting
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: NOV 2021
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- 5 Marks
PSAF – May 2020 – L1 – Q5c – General purpose financial reporting framework
Explain the qualitative characteristics of GPFR based on observations of a public sector entity’s financial report.
Question
Below are some observations made after an assessment of the General-Purpose Financial Report (GPFR) prepared by a public sector entity in 2018:
i) Not only were transactions not treated in accordance with the IPSAS, some were omitted unknowingly.
ii) In presenting the financial performance, position, and cash flow for the current financial year, 2018, the accountant has also provided information on the current year’s budget.
iii) Investment amounting to GH¢1,000,000 in short-term security reported in the financial position lacks supporting documents even though the investment may exist.
iv) The financial report was dated 30 June 2019, which is an improvement over the previous years, which was signed in September 2018.
Required:
In line with the Conceptual Framework for GPFR by public sector entity:
Explain the qualitative characteristics of GPFR for each observation in (i) to (iv) above and explain how each of the observations affects the usefulness of the GPFRs to the users.
(5 marks)
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- Tags: GPFR, IPSAS, Public Sector Accounting, Qualitative Characteristics
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: MAY 2020
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- 10 Marks
PSAF – May 2020 – L1 – Q1d – General purpose financial reporting framework
Explain the connection between the Conceptual Framework, IPSAS, and RPGs, and illustrate a practical case where the Conceptual Framework is useful.
Question
Some accountants hold the view that development of a Conceptual Framework for General Purpose Financial Reporting (simply, the Conceptual Framework) in the Public Sector is needless and a mere information overload on the Accountants. This argument is predicated on the fact that the Conceptual Framework does not establish authoritative requirements for financial reporting by public sector entities that adopt IPSAS, nor does it override the requirements of the International Public Sector Accounting Standards (IPSAS) or the Recommended Practice Guides (RPGs).
Required:
i) Explain the connection between the Conceptual Framework on one hand and IPSAS and RPGs on the other hand.
(2 marks)
ii) Illustrate a practical case where the Conceptual Framework would be useful to an accountant in the preparation and presentation of a General Purpose Financial Report for his organization.
(4 marks)
iii) Explain TWO (2) constraints on information included in the General Purpose Financial Reports.
(4 marks)
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- Tags: Conceptual Framework, IPSAS, Public Sector Accounting, RPGs
- Level: Level 2
- Topic: General purpose financial reporting framework
- Series: MAY 2020
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