Heritage assets in financial reporting: a critical analysis of the IPSASB's consultation paper

Purpose Within the stream of research on public sector accounting standards, heritage asset accounting represents a difficult and challenging issue. This paper intends to join the debate on heritage reporting by carrying out a critical review of the Consultation Paper (CP) Financial Reporting for Heritage in the Public Sector issued by the International Public Sector Accounting Standards Board (IPSASB) in order to highlight its strengths and weaknesses and to make recommendations. Design/methodology/approach To this end, the current study adopts document analysis as a qualitative research method by referring to Italy as a typical and critical case study. Moreover, the authors actively took part in the Italian working group on heritage assets reporting, so they are well-informed people about the Italian point of view as well as the broad discussion underpinning the Italian response. Findings Evidence demonstrates that, although the proposals included in the CP represent a new step towards an organic regulation of heritage asset reporting, if these preliminary views are confronted with the reality of an emblematic context, as in the Italian case, much room for improvement remains regarding the definition, recognition, measurement and disclosure of such assets. Originality/value The originality of the paper lies in its contribution to overcoming the current controversial aspects of heritage assets reporting and the issuing of an accounting standard. In doing so, the authors also attempt to answer the call made by Anessi-Pessina et al. (2019) to investigate in detail an individual country experience to better understand the state of the art in national and international accounting standards on heritage assets.

Automated summary

This study critically reviews the Consultation Paper issued by IPSASB on financial reporting for heritage in the public sector, focusing on the strengths and weaknesses and making recommendations. Using document analysis as a research method with Italy as a case study, the findings suggest that there is room for improvement in how heritage assets are defined, recognized, measured, and disclosed, especially in emblematic contexts like Italy. The paper contributes to addressing controversial aspects of heritage assets reporting and accounting standards, in line with Anessi-Pessina et al.'s call to investigate country-specific experiences in national and international accounting standards.