The Association of Public Finance Accountants of Sri Lanka (APFASL) has played a key role since its launch in 2012 to improve public sector financial reporting and accounting standards, said APFASL President and Chairman, Public Sector Accounting Standards Committee, V. Kanagasabapathy in an interview with Business Observer.
He said there has been some improvement in financial reporting and accounting standards in the public sector. We have seen interest shown by statutory bodies to develop public financial management. However, there is yet plenty of scope for improvement which to be recognised and supported by policy makers.
“We have launched many programs such as creating awareness, offering a professional qualification and holding annual awards ceremonies for best financial reporting in the public sector to strengthen financial management practices in Sri Lanka,” Kanagasabapathy said. APFASL is the public sector wing of the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka).
Its objectives are to professionalise public sector members and strengthen financial management practices in the country.
“We decided to have a special qualification for public sector financial managers, chartered public financial accountants in collaboration with Chartered Institute of Public Finance Accountants, UK, the only world body of accountants offering professional qualifications in public finance,” Kanagasabapathy said.
Since the launch of the qualification, around 224 APFASL members have been awarded the qualification initially on a merit basis.
“Financial reporting in the public sector has to be done in a transparent and accountable manner in compliance with accounting standards of the Sri Lanka Public Sector Accounting Standards (SLPSAS) based on the International Public Sector Accounting Standards (IPSAS),” Kanagasabapathy said, adding that the standards are meant to prepare accrual based accounting and reporting.
He said the government is not aware of what its assets are. There is no proper assets registry and inventory. Public assets are not reported in government accounts.
“We are helping the public sector to move into accrual based accounting. A task force was set up in 2017 by APFASLT involving government officials to assist the government in fast tracking the accrual system of accounting and reporting. APFASL’s secretary has been appointed to the steering committee to assist in the migration process. The Association has also been asked to prepare a check list for the transition from cash to accrual system.
Accrual accounting is an accounting method which measures the performance and position of a company by recognising economic events regardless of when cash transactions occur. The general idea is that economic events are recognised by matching revenues to expenses (the matching principle) at the time in which the transaction occurs rather than when payment is made (or received).
APFASL assists in building capacity at provincial and statutory bodies to implement the 20 accounting standards.
It has also formulated simplified accounting standards for local authorities. The best annual report and accounting competition among public sector institutions to bring out excellence in accounting.
The first Annual Conference of the CPFA and APFASL members was held at the auditorium of the Institute of Chartered Accountants of Sri Lanka (CA Sri Lanka) recently. This conference was organised by the Association of Public Finance Accountants of Sri Lanka (APFASL), the Public Sector Wing of CA Sri Lanka. The theme was ‘Sustainable Public Sector Financial Management – Think Forward’ ensuring upholding trust and accountability.
In his address, Kanagasabapathy emphasised the importance of the conference, especially as a forum that will facilitate the members of both APFASL and CPFA members meet to share professional experience and to proliferate new ideas that will support the achievement of national objectives. While paying attention to professionalising its membership, he outlined the leadership taken by APFASL in strengthening Public Financial Management in the country specially by the adoption and implementation of public sector accounting standards, conducting Best Annual Report and Accounts Award competitions, providing Capacity Development Programs and CPD programs with recognition from the Treasury.