The International Public Sector Accounting Standards Board (IPSASB) has updated the definition of materiality within IPSAS 1, IPSAS 2 and its Conceptual Framework.
These amendments clarify that an entity is required to consider the information needs of primary users. They also better align the definition of material information in IPSAS 1 and Chapter 3 of the Conceptual Framework.
IPSASB chair Ian Carruthers stated: “The amendments aim to bring consistency into our guidance on the definition of material, helping organizations apply it more effectively. A clear and well-understood definition will serve as a solid foundation for our planned guidance on how to make materiality judgments to be developed during the second phase of this project.”
The amendments to IPSAS 1 and IPSAS 3 are effective from 1 January 2027, with earlier application permitted. The amendments to the Conceptual Framework are effective immediately.
The standard setter will develop non authoritative guidance on making materiality judgements when preparing financial statements in accordance with the IPSAS standards.
Companies:IPSASB
People:Ian Carruthers
