In June 2025, the XRB issued two Exposure Drafts (EDs) for PBE IPSAS 47 Revenue and IPSAS 48 Transfer Expenses for a six-month consultation period. Both are based on the equivalent standards issued by the IPSASB in May 2023 and are centred on the concept of a binding arrangement.

Proposed PBE IPSAS 47 will supersede the current PBE revenue standards (PBE IPSAS 9 Revenue from Exchange Transactions, PBE IPSAS 11 Construction Contracts, and PBE IPSAS 23 Revenue from Non-Exchange Transactions). It introduces a new approach to revenue recognition based on NZ IFRS 15 Revenue from Contracts with Customers but modified for application to Tiers 1 and 2 Public Benefit Entities (PBEs) i.e. public sector and not-for-profit entities. Proposed PBE IPSAS 48 is a new standard.

The key points raised on our submission are:

• We have heard concerns about the costs involved in adopting proposed PBE IPSAS 47 and moving to a brand-new revenue recognition model. However, on balance, we consider that the long-term benefits of a more consistent and comparable revenue recognition model make this an acceptable trade-off.
• Our stakeholders also have significant concerns relating to the cost and complexity of the proposed PBE IPSAS 48 and are of the view that the benefits would not outweigh the costs, particularly in the NFP sector. We urge the XRB to complete a strategic review of user needs and cost-benefit considerations for ED PBE IPSAS 48 in both the public and the NFP sector prior to any final decision regarding its adoption as we believe the cost-benefit trade-off in each sector may be different.
• We support the XRB’s planned field testing of both EDs as one way to assess the cost versus benefit impact of adopting the proposed standards. We recommend the field testing for ED PBE IPSAS 47 focuses on the cost-benefit relating to the application of the key principles. For ED PBE IPSAS 48, we suggest that the cost-benefit analysis be more holistic to include an evaluation of user needs, information relevance, costs and practicality in both the public and the NFP sectors.
• We also consider that implementation working groups should be established to support the implementation of PBE IPSAS 47 and PBE IPSAS 48 if the XRB chooses to adopt the standards.