Updates to Accounting and Assurance Standards

The following updates to the accounting and assurance standards were recently added to CPA Ontario’s knowledge hub and resources web page:

• Lack of Exchangeability – Amendments to IAS 21, The Effects of Changes in Foreign Exchange Rates have been issued to clarify how a company should assess whether a currency is exchangeable and how it should determine a spot exchange rate when exchangeability is lacking. Additional information will be required to be disclosed to enable users to evaluate how a currency’s lack of exchangeability affects, or is expected to affect, its financial performance, financial position and cash flows. These amendments are effective for annual reporting periods beginning on or after January 1, 2025, with early application permitted.
• Accounting for Common Control Combinations – Amendments to Section 3840, Related Party Transactions have been issued to clarify that business combinations under common control that meet the criteria specified in paragraph 3840.44(a) should be accounted for in accordance with Section 1582, Business Combinations; the reference to “exchange amount” previously included in paragraph 3840.44(a) has been removed. Amendments to Section 3856, Financial Instruments have also been issued to clarify that financial assets acquired, or financial liabilities assumed when a business is transferred between two enterprises under common control are to be measured using the principles in Section 3840.44, not Section 3856. The amendments to Sections 3840 and 3856 are effective for annual reporting periods beginning on or after January 1, 2025, with early application permitted.
• PSAB’s New Financial Reporting Model – Section 1202, Financial Statement Presentation and related consequential amendments have been issued, which replaces PS 1201, Financial Statement Presentation. The new standard includes changes to the statement of financial position, a new statement of net financial assets or net liabilities; a new statement of changes in net assets or net liabilities; and new budget requirements for presentation of an amended budget. The standard is effective for fiscal years beginning on or after April 1, 2023, with early application permitted if the Conceptual Framework is adopted at the same time.

Check out CPA Ontario’s knowledge hub and resources web page regularly for the latest developments in our profession. 

For questions, please contact CPA Ontario’s Professional Advisory Services at 416 204.3106 or 1 800 387.0735, ext. 4456 or by email.