State entities to migrate to accrual-based system

Business Writer

State entities are expected to migrate from cash accounting to accrual-based International Public Sector Accounting Standards (IPSAS) by end of 2025 to enhance accountability and transparency of public resources, the Auditor General Office said.

The Government made the decision to migrate from cash accounting to accrual-based International Public Sector Accounting Standards (IPSAS) with effect from January 1, 2018.

Public Accountants and Auditors Board (PAAB), which is the regulator of the Accountancy profession in Zimbabwe prescribed the International Public Sector Accounting Standards for use in Zimbabwe on March, 1 2019 through Statutory Instrument 41 of 2019.

On April 1, 2019, the Minister of Finance and Economic Development Professor Mthuli Ncube launched the National Implementation Strategy and Plan (ISP). President Mnangagwa signed a copy of the ISP. Further, the Treasury developed the Zimbabwe Financial Reporting Manual (ZFRM) which is expected to guide the adoption and implementation of IPSAS.

“In order to support the IPSAS migration process, (the OAGs office) and the Accountant General (are) finalising an audit protocols memorandum which will guide the work that we will do in supporting the migration process,” said the OAG.

It said the objective of these audit protocols is to set the transitional provisions for central Government, public entities, municipal entities, constitutional institutions and funds and how the audits will be conducted during the transitional phase.

“The OAG is committed to work together with the Government in ensuring that entities comply with IPSAS. All entities are also encouraged to work with the OAG especially the internal audit departments in the IPSAS journey,” said the OAG.

Speaking during the launch of the Zimbabwe Financial Reporting Manual and Public Sector Professional Accountancy of Zimbabwe (PSPAZ), Prof Ncube said the adoption of the IPSAS framework complements the Government’s recognition of the role of timely reporting in financing the transformation of the economy towards the national vision.

“The accrual-based IPSAS reporting framework will be supportive of Government efforts to achieve the desired results-based performance through efficient utilisation of resources and, timely and transparent reporting. The reform is part of ongoing efforts to enhance and strengthen the Public Finance Management system,” he said.