ICAI Seeks Comments by September 5 on IPSAS Financial-Statement Presentation Overhaul; New Standard Would Replace IPSAS 1

Indian public-sector accounting stakeholders have a live deadline approaching on a potentially significant redesign of financial-statement presentation. ICAI’s Committee on Accounting Standards for Local Bodies consultation portal is seeking comments by September 5, 2026 on the International Public Sector Accounting Standards Board’s Consultation Paper on Presentation of Financial Statements.

The underlying IPSASB project is intended to develop a new IPSAS Standard that would replace IPSAS 1, Presentation of Financial Statements. IPSASB issued the consultation paper in April 2026, while ICAI’s consultation page lists the document as issued for comment on August 10 and sets the Indian comment-letter deadline at September 5.

What the proposed overhaul is trying to change

IPSASB says the project is aimed at improving the communication effectiveness and comparability of financial information in general-purpose public-sector financial statements. The scope includes general presentation requirements, the statement of financial position, the statement of financial performance, changes in net assets or equity, and information disclosed in the notes.

The most substantial proposals concern the statement of financial performance. The consultation proposes classifying revenue and expenses recognised in surplus or deficit into specified categories and introducing an operating surplus or deficit subtotal. It also considers how expenses should be presented by nature or by function and seeks views on whether mixed presentation should be permitted, reflecting an option introduced in IFRS 18.

Other presentation changes under consideration

- Retaining much of the existing IPSAS 1 framework while updating definitions and comparative-information requirements.

- Adding a requirement to present goodwill as a line item in the statement of financial position.

- Requiring reconciliation of each component of net assets or equity on the face of the statement of changes in net assets or equity rather than allowing that reconciliation to sit only in the notes.

- Updating note-disclosure guidance to reflect relevant developments in international financial reporting.

IPSASB’s project also considers developments since IPSAS 1 was first issued in 2000, including its Conceptual Framework, IFRS 18 and changes in government-finance statistical reporting. The Board’s global consultation deadline is September 14, 2026, but stakeholders using ICAI’s comment process should work to ICAI’s earlier September 5 deadline.

Who should consider responding

The consultation is especially relevant to public-sector finance professionals, auditors, government-accounting specialists, academics and members involved in standards work. Respondents do not need to treat the exercise as a purely international technical matter: presentation rules shape how operating performance, financial position and accountability are communicated to users of government and other public-sector financial statements.

Professionals with experience preparing, auditing or using public-sector financial statements should review the consultation and focus comments on areas where a revised presentation model could improve or complicate comparability and decision-usefulness. For the ICAI route, the actionable date is September 5, 2026.

Key takeaway

Live ICAI consultation with a near-term deadline and substantive international public-sector reporting proposals that affect presentation, comparability and accountability.