CPSEs (formerly know as GBEs) are government corporations which have all the following characteristics as defined under the pertinent provisions of the International Public Sector Accounting Standards (IPSAS):
- Is an entity with the power to contract on its own name;
- Has been assigned the financial and operational authority to carry on a business;
- Sells goods and services, in the normal course of its business to other entities at a profit or full cost recovery;
- It is not reliant on continuing government funding to be a going concern (other than purchases of outputs at arm’s length); and
- Is controlled by a public sector entity.
CPSEs include both trading enterprises such as utilities, and financial enterprises, such as financial institutions. GBEs are, in substance, no different from entities conducting similar activities in the private sector. GBEs generally operate to make a profit, although some may have limited community service obligations under which they are required to provide some individuals and organizations in the community with goods and services at either no charge or a significantly reduced charge.
In addition, CPSEs shall also include banks and non-bank financial institutions under the supervision of the BSP and entities registered with the SEC required to adopt PFRS.
Non-CPSEs refer to entities which do not meet all of the above characteristics.