Periods of uncertainty can emerge quickly and from many directions. Ongoing geopolitical developments and macroeconomic volatility continue to create challenges for public sector entities as they deliver essential services, manage budgets and capital programs, and respond to evolving community needs.

While operational impacts are often front of mind, this uncertainty can also affect how public sector entities prepare and present their financial statements.

To help entities navigate this, we recently published the fact sheet Financial reporting considerations in uncertain times. This blog highlights the main guidance it provides.

What entities need to consider

Financial reporting during periods of uncertainty is not a new challenge. During the COVID‑19 pandemic, public sector entities had to address complex accounting issues while applying existing accounting requirements in rapidly changing circumstances. Today’s environment presents different challenges, but many of the same reporting considerations remain relevant.

Some impacts of uncertainty are easy to identify. Rising fuel, labour, and construction costs, for example, can place pressure on operational budgets and major projects.

Other reporting implications can be less obvious. Changes in supply chains, procurement pricing, demand patterns, capital program delivery, and discount rates used in asset valuations can all influence financial reporting outcomes.

As uncertainty increases, so does the need for professional judgement. Assumptions that were previously straightforward may require greater scrutiny, while estimates can become more complex and sensitive to change. Entities should therefore regularly reassess key judgements and the information that supports them.

Why these considerations matter

Clear disclosures are especially important during uncertain times. Users of financial statements should be able to understand how conditions have affected an entity's financial position, performance, and future outlook. Providing meaningful information about key assumptions, estimation uncertainty, and significant judgements can support entities’ informed decision-making and improve stakeholder confidence in financial reporting.

Uncertainty can also place pressure on entities’ internal controls and governance arrangements. Reviewing controls, oversight processes, and key assumptions throughout the reporting cycle can help entities respond effectively to changing circumstances and reduce the risk of fraud, error, and oversight gaps.

Our new fact sheet can help

The fact sheet brings these considerations together and highlights several financial reporting areas that may require additional attention during uncertain times, including:

• valuation of property, plant and equipment
• fair value of financial assets and liabilities
• recoverability of receivables
• provisions, contingencies, and guarantees
• budgetary reporting
• cash flow management
• internal controls and governance
• events after the reporting date.

For each area, we provide practical considerations to help management assess whether assumptions, estimates, disclosures, controls, and governance arrangements remain appropriate in the current environment. This includes assessing whether current volatility is temporary or may represent sustained changes in underlying conditions.

Finance teams may wish to review the fact sheet and consider whether additional work is needed in key risk areas ahead of reporting deadlines.

Resources

Read the fact sheet: Financial reporting considerations in uncertain times

Looking for additional reporting guidance? Explore these resources:

• Financial statement preparation maturity model self-assessment tool
• Our update on Queensland Treasury’s reporting requirements for 2026 
• Using technology well when preparing financial statements
• Key management personnel remuneration – getting it right

We welcome your feedback

We welcome your feedback on the new fact sheet to help us continue improving our guidance. Please discuss any feedback with your QAO engagement leader, or send questions and comments to communications@qao.qld.gov.au.