Service concession arrangements provide a way for public sector entities to build the infrastructure necessary to maintain and improve critical public services. The use of service concession arrangements continues to increase due to the ongoing global financial and economic crises.
The objective of this Standard is to prescribe the accounting for service concession arrangements by the grantor, a public sector entity.
IPSAS 32 Service Concession Arrangements: Grantor is intended to “mirror” IFRIC 12 'Service Concession Arrangements', which sets out the accounting requirements for the private sector operator in a service concession arrangement. To do so, the scope, principles for recognition of an asset, and terminology are consistent with the applicable guidance in IFRIC 12. However, because this Standard deals with the accounting issues of the grantor, this Standard addresses the issues identified in IFRIC 12 from the grantor’s point of view.
An entity shall apply IPSAS 32 for annual financial statements covering periods beginning on or after January 1, 2014. Earlier application is encouraged. If an entity applies this Standard for a period beginning before January 1, 2014, it shall disclose that fact and apply IPSAS 5, 'Borrowing Costs', IPSAS 13, 'Leases', IPSAS 17, IPSAS 29, and IPSAS 31 at the same time.
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