New standard – Financial Statement Presentation

PSAB issued a new financial reporting model (Section PS 1202), including related consequential amendments that responds to the need for understandable financial statements for the public and its elected and appointed representations and replaces Section PS 1201, Financial Statement Presentation. The new standard includes change to the presentation of financial statements, such as:

  • changes in the statement of financial position
  • adding a new statement of net financial assets or net financial liabilities
  • providing the option to present the change in net financial assets or net financial liabilities on the statement of net financial assets or net financial liabilities
  • adding a new statement of changes in net assets or net liabilities
  • new budget requirements in order to present an amended budget

The statement of operations remains substantially unchanged to the one in superseded Section PS 1201. The new standard includes guidance in various appendices and illustrative financial statements and includes a discussion on going concern.

Effective for fiscal years beginning on or after April 1, 2026, with early application permitted if the Conceptual Framework is adopted at the same time. The accompanying Basis for Conclusions document explains PSAB’s reasoning for key decisions made.

Revised standards – 2022-2023 Annual Improvements

PSAB issued the following narrow-scope amendments in April 2023 as a result of the 2022-2023 annual improvements:

  • updated the transitional provisions in Section PS 3160, Public Private Partnerships, to explicitly state that early adoption is permitted and
  • updated Section PS 3420, Inter-entity transactions, to clarify the application of accounting guideline, PSG-8, Purchased Intangibles, to inter-entity transactions.

Effective for fiscal years beginning on or after April 1, 2023, with early application permitted.

PSAB issued the following 2022-2023 remaining annual improvements in February 2024:

  • Replaced the phrase “summary financial statements” with “financial reports” in all standards where the phrase is used and added a cross-reference to Chapter 3 of the Conceptual Framework for Financial Reporting in the Public Sector to position financial statements as an important type of financial report.
  • Clarified the “Introduction To Public Sector Guidelines” and removed outdated guidance related to local governments.
  • Replaced the word “power” with “ability” or “authority”, as appropriate, given the use of “power” to reference sovereign or equivalent powers in Chapter 5 of the Conceptual Framework.
  • Corrected grammatical errors in the decision tree in Section PS 3050, Loans Receivable.
  • Replaced the word “government” with “public sector entity” or “entity”, as appropriate, in Sections PS 1150, PS 2400, PS 3150, PS 3250 and PS 3310.
These amendments are effective immediately.

New framework - The Conceptual Framework for Financial Reporting in the Public Sector

The PSAB issued The Conceptual Framework for Financial Reporting in the Public Sector, which replaces the conceptual aspects of Section PS 1000, Financial Statement Concepts and Section PS 1100, Financial Statement Objectives.

The conceptual framework highlights considerations fundamental for the consistent application of accounting issues in the absence of specific standards. The accompanying Basis for Conclusions document explains PSAB’s reasoning for key decisions made.

Effective for fiscal years beginning on or after April 1, 2026, with early application permitted.

New standard - Public private partnerships

The PSAB issued a new standard (PS 3160) that addresses the recognition, measurement, presentation and disclosure of infrastructure procured by public sector entities through certain types of public private partnership arrangements. This would include private partnership arrangements where the private sector partner is obligated to:

  • design, build, acquire or better new or existing infrastructure
  • finance the transaction past the point where the infrastructure is ready for use
  • operate and/or maintain the infrastructure

Effective for fiscal years beginning on or after April 1, 2023, with early application permitted.

Exposure draft – Narrow-scope Amendment: GAAP Designation of PSA Handbook Appendices

PSAB issued an exposure draft proposing narrow-scope amendments to elevate the level of generally accepted accounting principles (GAAP) designated for four CPA Canada Public Accounting Handbook appendices (i.e., what level of GAAP an appendix comprises).

  1. Appendix A to Section PS 3400, Revenue;
  2. Appendix B to Section PS 3410, Government Transfers;
  3. Appendix A to Section PS 3450, Financial Instruments; and
  4. Appendix A to Section PS 4270, Disclosure of Allocated Expenses by Not-for-Profit Organizations.

The Exposure Draft proposes that such appendices should be level (i) GAAP, the same as the standard to which they relate. PSAB is also proposing to remove an outdated cross-reference in a decision tree to an accounting framework that no longer exists in the CPA Canada Handbook – Accounting.

Comments are requested by April 11, 2024.

Exposure draft – Tangible Capital Assets, proposed amendments to Section PS 3150

PSAB issued an exposure draft aiming to increase comparability and transparency among public sector entities, including government not-for-profit organizations, by amending certain definitions, proposing additional guidance to ensure consistent application of the standard, and clarifying certain topics. This project is the first in a series of projects to implement PSAB’s Government Not-for-Profit Strategy, which encompasses a review of the PS 4200 series standards. Sections PS 4230, Capital Assets held by Not-for-Profit Organizations, and PS 4240 Collections held by Not-for-Profit Organizations, will be withdrawn as a result of the proposed amendments to Section PS 3150.

The proposed amendments would:

  • amend the definition of “tangible capital asset”
  • add guidance to identify a “collection”
  • add disclosure requirements to highlight the importance of works of art, historical treasures, and collections
  • add guidance to clarify the accounting treatment for situations addressed by the PS 4200 series

Comments are requested by April 15, 2024.

Exposure draft – Employee Benefits, Proposed Section PS 3251

The PSAB issued an exposure draft that outlines principles for the first of several phases of the revised employee benefits standards.

Proposed Section PS 3251 would replace existing sections PS 3250, Retirement Benefits, and PS 3255, Post-employment Benefits, Compensated Absences and Termination Benefits. Key changes include:

  • the rate used to discount a post-employment benefit plan would depend on the plan’s funding status
  • a deferral and amortization approach for actuarial gains and losses would no longer be used

The comment period is closed. PSAB is currently deliberating feedback received.

International Public Sector Accounting Standards (IPSAS)
Exposure draft – Exploration for and Evaluation of Mineral Resources

IPSASB issued an exposure draft that proposes a standard on accounting for the costs incurred in the exploration and evaluation of mineral resources, based on the selection of an accounting policy specifying which expenditure should be recognized as exploration and evaluation assets. ED 86 is aligned with the private sector requirements in IFRS 6, Exploration for and Evaluation of Mineral Resources, with limited changes for the public sector context.

Comments are requested by May 31, 2024.

Exposure draft – Stripping costs in the Production Phase of a Surface Mine (Amendments to IPSAS 12)

IPSASB issued an exposure draft that proposes adding an authoritative appendix to IPSAS 12, Inventories. The proposed guidance clarifies when to capitalize or expense costs incurred to remove waste material in surface mining operations. ED 87 is aligned with the guidance in IFRIC 20, Stripping costs in the Production Phase of a Surface Mine, with limited changes for the public sector context.

Comments are requested by May 31, 2024.

Additional non-authoritative guidance

To stay ahead of the curve, find additional non-authoritative guidance to help you navigate the application of the Public Sector Accounting Standards.

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