- National Professional Organisation Website: Chartered Professional Accountants Canada (CPA Canada)
- National Standard Setter Website: Accounting Standards Board of Canada
- IFAC Compliance Responses and Action Plans
Financial Reporting Framework in Canada
Standards board. Accounting Standards for all Canadian entities outside of the public sector are established by the Accounting Standards Board of Canada (AcSB). The Public Sector Accounting Standards Board (PSAB) establishes accounting standards for entities that are part of the public sector.
The CPA Canada Handbook includes accounting and assurance standards under the following headings:
- Public Sector Accounting Handbook
The accounting section of the handbook contains the standards established by the AcSB and is divided into five parts. Each contains a Canadian financial reporting framework for a specific type of entity. Part V of the CPA Canada Handbook contains Canadian accounting standards that were in place prior to the adoption of International Financial Reporting Standards (“IFRS”) in Canada. Part V was applicable only for a temporary period of time for certain entities for which the mandatory changeover date, of 1 January 2011, to IFRS was deferred.
The table below summarizes the different types of Canadian entities and the corresponding financial reporting framework for each type of entity.
|Type of entity||Financial Reporting Framework||Handbook Reference|
|Publicly accountable enterprises||IFRS||CPA Canada Handbook Part I|
|Private enterprises1||Accounting Standards for Private Enterprises (ASPE)||CPA Canada Handbook Part II|
|Not-for-profit organizations2||Accounting Standards for Not-for-profit organizations (NFPOs)||CPA Canada Handbook Part III|
|Pension plans||CPA Canada Handbook Section 4600, Pension Plans||CPA Canada Handbook Part IV|
|Publicly accountable enterprises subject to a deferred IFRS adoption date||Pre-changeover accounting standards||CPA Canada Handbook Part V|
|Public Sector entities||Public Sector Accounting Standards (PSAS)||Public Sector Accounting Handbook|
1 Private enterprises may also elect to apply Part I of the Handbook (IFRS).
2 Not-for-profit organizations may elect to apply Part I of the Handbook (IFRS)
IFRSs in Canada. Application of IFRSs has been mandatory since 2011. For rate-regulated entities and investment companies, IFRSs were permitted but not required to adopt IFRS in 2011. Investment companies benefited from a deferral until 1 January 2014. Rate-regulated entities benefited from a deferral until 1 January 2015. However, the Canadian Securities Administrators (CSA) have provided an option for those registered with the SEC to apply US GAAP instead of Canadian GAAP. The CSA also concluded that rate-regulated entities that are not registered with the US SEC may ask their Principal Provincial Regulator for an extension of their exemption from the requirement to adopt IFRS until 2019. The relief is provided under the CSA's umbrella policy - National Policy 11-203 Process For Exemptive Relief Applications in Multiple Jurisdictions.
The application of IFRSs in Canada is broader than in Europe and it applies to more types of entities. Canada has adopted the notion of the publicly accountable entity (PAE) — a concept very similar to the one used in IFRS for SMEs. In that respect many Crown Corporations or government business enterprises (GBO’s) have to apply IFRSs. Similarly, brokerage firms and investment companies not listed but with a broad number of investors are being required to apply IFRSs.
Oversight. The Accounting Standards Oversight Council (AcSOC) oversees the activities of the AcSB and PSAB. AcSOC appoints their members, provides input in their activities, primarily in terms of their strategic direction and priorities. AcSOC also assesses and reports on their performance.
Securities regulation. Securities regulation in Canada is the responsibility of 13 provincial and territorial regulators, rather than a national regulator. Therefore provincial and territorial regulators enforce the application of AcSB standards by public companies. There is a coordinating body of securities regulators known as Canadian Securities Administrators (CSA).
Deloitte (Canada) IFRS Resources
Deloitte (Canada) maintains the following sites in relation to IFRS:
- IAS Plus, Centre for Financial Reporting — This site contains recent accounting and securities related news, resources, learning tools, hot topics, links and other useful information for each of the accounting frameworks in Canada. Click for access to the site in English or French.