NFPO Combinations – NFP Advisory Committee

Date recorded:

At its meeting on July 30, 2019 the Committee received the field-test results on the draft proposals for the initial measurement of a combination between organizations within the scope of Part III of the CPA Canada Handbook - Accounting. The Committee also discussed staff recommendations and advised the AcSB that:

  1. more clarity should be provided on the conditions to determine whether a transaction should be accounted for as a merger or an acquisition to reduce the potential for diversity;
  2. illustrative examples should be included in the standard for the types of combinations that should be accounted for as mergers and those that should be accounted for as acquisitions; and
  3. disclosure of the rationale for undertaking a merger or acquisition would be informative for financial statements users.

Committee members also advised on other sections of the draft proposals, the consequential amendments, and the proposed Exposure Draft questions. The Committee will conduct a fatal-flaw review of the Exposure Draft in October 2019. The AcSB plans to issue the Exposure Draft in January 2020.

Review the summary of discussions on the AcSB's Web site.

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