Institutional Independence and Governance Structures
To prevent political interference in accounting rules, standard-setting bodies operate independently from government payrolls. If the executive branch controlled standard-setting, it could manipulate reporting definitions to hide deficits or understate public debt.
  • IPSASB Governance: Monitored by the Public Interest Committee (PIC), ensuring that the standards protect the global public interest. Its funding relies on international grants, professional associations, and IFAC contributions.
  • GASB Governance: Overseen by the FAF trustees and advised by the Governmental Accounting Standards Advisory Council (GASAC). Funding is structurally insulated via a statutory administrative support fee levied on municipal bond issuers.

The Standard-Setting Process (Due Process)
Both organizations follow a rigorous, transparent “Due Process” before a standard becomes legally binding:
Research Stage ──► Discussion Paper (DP) ──► Exposure Draft (ED) ──► Public Comment Review ──► Final Statement/Standard

  1. Research & Agenda Setting: Topics are chosen based on widespread reporting gaps, user demands, or structural shifts in public finance.
  2. Discussion Paper (DP): An exploratory document mapping out the core problems, alternative accounting methods, and preliminary arguments.
  3. Exposure Draft (ED): A complete draft of the proposed standard made available to the public. It serves as a formal call for feedback.
  4. Public Comment & Roundtables: Standard setters review formal response letters from global ministries, audit firms, academics, and international institutions.
  5. Final Issuance: The standard is voted upon and issued with an effective implementation timeline and transitional provisions.

 
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