IPSAS: Non-Exchange Transactions – The Case of the Consolidated Financial Statements of the Swiss Confederation

Abstract

The International Public Sector Accounting Standards (IPSAS) classify transactions into two main categories: exchange transactions, where entities directly trade value, and non-exchange transactions, where one entity provides or receives value without an equivalent return. Exchange transactions involve direct reciprocity, such as the purchase of goods or services. Non-exchange transactions include taxes, fines, grants, and donations, which do not entail a direct exchange of value. Public sector entities are predominantly financed through non-exchange transactions, such as tax payments and government transfers. Some transactions combine elements of both categories, requiring a detailed assessment to determine their nature. Standards require the disclosure of revenue, assets, and liabilities arising from non-exchange transactions. An example of such disclosure is illustrated through the consolidated financial statements of the Swiss Confederation for the year 2024. The classification and recognition of these transactions affect financial reporting and decision-making in the public sector.