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NASJONALT FORSKNINGSINSTITUTT med regional forankring og internasjonal relevans 

Mission Impossible or an Obvious Option

Provisions and Contingent Liabilities in Norwegian Local Government Accounting


Implementing Reforms in Public Sector Accounting.

ISBN 978-989-8074-39-3. Coimbra University Press. Portugal 2008.  

Abstract

In this article we are focusing on provisions and contingent liabilities in Norwegian local government accounts. During the last years many provisions and contingent liabilities have been incorporated into the Norwegian local government accounting system. The most extreme case in this regard is employee benefits like pension liabilities. The aim of this article is to investigate if it is possible to report long-term liabilities as provisions and contingent liabilities in a modified cash accounting system. Another area actualizing the problem at hand is the accelerating use of financial instruments in Norwegian municipalities and counties. We are discussing the possibility and necessity of including social benefits into the accounts. The presentation is divided into three parts: 1) Identification of uncertain and contingent liabilities in Norwegian local government. 2) Discussion of the relevance of the problem at hand. 3) Comparison of Norwegian accounting practice and the regime described by IPSAS 19.

Key Words: Provisions, Contingent Liabilities, Local Government Accounting, Modified Accrual Accounting System.