Page 1 Regional Challenges and Key Success Factors to Implementation of IPSAS Prof. Dr. Andreas Bergmann Chair IPSAS Board CReCER 2012 Managua, Nicaragua 29 October 2012 (by-invitation-only event)

Page 2 Government accounting and budgeting is relevant Credit Ratings (S&P) – Latin America bias? Reputation? Transparency and Accountability Country LAC Rating (foreign currency) Govt Debt in % of GDP (IMF, 2012) Country Europe Rating (foreign currency) Govt Debt in % of GDP (IMF, 2012) BrazilBBB66%NetherlandsAAA66% ChileA+10%EstoniaAA-6% ColombiaBBB-35%SwitzerlandAAA38% PanamaBBB38%SlovakiaA44% PeruBBB22%LuxemburgAAA20% UruguayBBB-54%PolandA-55%

Page 3 Accrual accounting is generally accepted After 20+ years of reform –About 70 countries are on accrual accounting, thereof about 50 on IPSAS basis or heading there –In some additional countries sub-national levels are on accrual accounting even if national level is still on cash –None of the reforms have been reverted –Accrual accounting provides cash information (in the cash flow statement) –Broad consensus: Accrual accounting enhances transparency and improves decision making – especially in respect of investments (e.g. infrastructure) and liabilities (e.g. the non-government-bond types) Transparency and Accountability

Page 4 Need for an integrated system BudgetingAccountingAudit Governmental Financial Statistics Transparency and Accountability

Page 5 Why, when and how Why? Improve accountability and decision making When? Now – why wait … How? As part of an integrated reform! Transparency and Accountability