1. IPSAS vs. GFS
IPSAS – practical use for budgeting and benefits in terms of how GFS statistics and fiscal indicators can be extracted from the budgetary system

2. New Public Finance Act (PFA)
Previously, the focus was on next year/detailed appropriations
Fiscal policy was relatively poor
The new PFA is looking to at least 5 years regarding policies on expenditure areas, revenues and taxes
The focus in not the only on BCG (budgetary central government), but also on CG, LGs (local governments) and the public sector.
Statement of Fiscal Policy (SFP)
- When government is formed, a SFP should be submitted to Althingi for approval
- The Policy is based on following principles: substainabitity, prudence, stability, predicatabilty and transparency
- Fiscal conditions for both SFP and Fiscal Strategy Plan (FSP). FSP is based on SFP
- Objectives for the scope, fiscal balances and development of assets and liabilities for GG and PS.
- A Report on how the principles should be followed
- SFP and FSP should be presented in accordance with GFS
- Long-term outlook and development at least every three years
Fiscal Strategy Plan for at least next 5 years
- FSP for CG, LG and public sector – no later than 1 April each year
- Targets for fiscal balances and balance sheet positions, revenues and expenditure (economic type), etc.
- Targets for ca. 30 expenditure areas
Budget bill for BCG for the next year in the authumn
- Appropriations for expenditure areas (ca. 30) and expenditure functions (ca. 200)
- Revenue estimations
Fiscal Council
- Form an opinion as to whether the fiscal policy and fiscal strategy are in accordance with the principles
- The opinions of the Fiscal Council shall be made public

3. The Concept Hugmyndafræðin
The Policy is based on following principles: (1) substanability, (2) stability, (3) prudence, (4) predicability and (5) transparency
Health,
Old age,
Environmental issues,
Education,
Liabilities, etc
30 years/ underlying analysis
5 years
Statement of Fiscal Policy – fiscal balances and debt
5 years
Fiscal Strategy Plan – Fiscal policy and expenditure plans
Fiscal Strategy Plan / Public sector finance / BCG finances
Fiscal Policy of general government sector
The Policy of the Public Corporations
BCG‘s policy on expenditure areas
Fiscal balances
Public order and safety
Key indicators:
Revenue,
Expense
Operating balance
Investment
Net lending/borrowing
Nonfinancial assets
Financial assets
Liabilities
Net worth
Education
Revenue and tax policy
Tertiary education
Employee and wage policies
Secondary education
Subsidies; corporate support
Other education
Health
Benefits, households support
Medical products
Grants; LGs&foreign support
Outpatient services
Investment policy
Hospital services
Nursing homes
Fjármögnunarstefna
Management & surv.
Social protection
Finance and debt policy
Environmental prot.

4. GFS references in PFA
CHAPTER II: Fiscal policymaking – Article 4 Fiscal Policy Statement
Whenever a government has been formed, it shall formulate a Statement of Fiscal Policy to be submitted by the Minister to the Althingi in the form of a proposal for a parliamentary resolution as soon as possible, no later than concurrently with the submission of the next Budget Bill.
The Statement of Fiscal Policy shall be divided into the following components:
Objectives for the scope, fiscal balances and development of assets, liabilities and long-term obligations of public entities as a whole and of the general government for a period of at least five years. The objectives shall be presented as a ratio of gross domestic product. Definitions of objectives regarding fiscal performance, such as fiscal balances and the balance sheets, shall take account of international statistical standard (GFS).
Article 5 – Fiscal Strategy Plan
No later than 1 April each year, the Minister shall submit to the Althingi a proposal for a parliamentary resolution on a Fiscal Strategy Plan for at least the next five years. …………………………
…………………….. The presentation of the Fiscal Strategy Plan shall be in accordance with the international standards specified in Chapter V.
CHAPTER V: Financial statements and fiscal reporting
Article 50 – Central government activities and programmes
……………The classification of central government activities is based on international statistical standard for public sector (GFS).
Article 52 – Preparation and presentation of financial statements
The financial statements for Group A of the central government as a whole shall be prepared and presented in accordance with international accounting standards for public sector (IPSAS), which are on accrual basis.

5. Fiscal strategy for General Government
Policy on taxation and other revenues to 5 years
Employment and wage policies and policy on government consumption to 5 years.
Part of finance policy
Policy on subsidizing the corporate sector
Policy and foreign grants and GG subsectors
Policy on social benefits / households
Investment policy
Finance policy

6. Accounting vs GFS frameworks
Flows
Transactions
* Operating result
** operating balance
*** net lending / borrowing
Revenue
transactions
Revaluation
Volume
change
Revenue
Expense
Opening
balance
Other economic flows
Closing
balance
Expense
Transactions
Revaluation
Volume
change
Revaluation /
Volume change **
Opening
Balance
Sheet
Closing
Balance
Sheet
Non-
financial
assets
NFA
NFA
NFA
NFA *
***
Assets
and
liabilities
Non-financial
Financial
assets
Assets
and
liabilities
Financial
assets FA FA FA FA
Liabilities
Liabilities
Liab
Liab
Liab
Liab
Net worth
Change in net worth
Net worth

7. GFS versus Accounting (IPSAS or IFRS)
Transactions between units
Revaluations and other volume changes (calculated figures)
Transactions between units

8. Projections on net financial worth and net worth
Supports projections on net financial worth and debt

9. Consistency between Budgeting, Accounting and Statistics
Same terminology
Comparability of figures
Efficiency and timesaving
Reduced timeliness of data provision
Fiscal policy vs. monetary policy
Common understanding by various compilers, producers and users

10. Ministers’ Annual Reports
Reporting practice
Monthly
Statement of Operations
Central govenment
Cash basis
Quarterly
Statement of Operations
General govenment
Public sector
Accrual basis
Annual
Statement of Operations
General govenment
Public sector
Accrual basis
Ministers’ Annual Reports