Treasury to announce ruling on PFI accounting

News Article - 24 May 2012
Category:

December will see the Treasury give its opinion on how private finance initiative (PFI) projects should be accounted for.

Reported in Accountancy Age, the International Financial Reporting Interpretations Committee announced in 2006 that it believed the Treasury would change where PFI deals would appear on balance sheets.

It claimed that the deals should appear on public sector books thereby changing where the risk factor lies.

Such a move is said to reduce the complications and abstruseness of the terms when accounting for assets and make contracts more explicit. Applying these changes would allow a number of PFI deals to come back onto government books.

However, it is reported that the Treasury will change the methods of accounting for assets in order to reduce the complications and abstruseness of the issue.

The Financial Reporting Advisory Board has previously called for the government to drop the risk assessment of PFI accounting.

PFI began in 1984 when private finances were used to fund public services, the first of which was British Telecom.

Article keywords:

---

More industry news

• Think tank warns UK may have already slipped back into recession
• Growing demand for HR staff in technology and international sectors
• Boosting business growth a ‘priority’ to avoid Eurozone slowdown
• HMRC launches alternative disputes pilot scheme this week
• December employment statistics disregard gloomy recruitment predictions
• Eurozone manufacturing PMI shows modest improvement
• UK scores highly for economic governance by ratings agency
• Government launches two-year project focusing on manufacturing sector
• Burden of regulation on UK businesses ‘too high’

Back to news home page »