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Feedback Statement – Post-implementation Review: Section PS 3410

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Apr 20, 2016

On April 20, 2016, the Public Sector Accounting Board (PSAB) released a document summarizing the findings of its Post-implementation Review.

The findings of the Post-implementation Review confirmed earlier indications that the primary areas of concern with  Section PS 3410, Government Transfers, are recipient accounting for capital transfers, and the role of the “authority to pay” relating to authorization in one jurisdiction. Stakeholders generally did not have a major issue with implementing other changes or guidance in the revised standard. They indicated that the definitions of, and the distinction between, eligibility criteria and stipulations are particularly helpful.

Given the controversy with respect to recipient accounting for capital transfers and the principles-based nature of Section PS 3410, PSAB anticipated differing application issues when it approved the revised standard. The findings of this Post-implementation Review indicated that many stakeholders:

  1. were able to work through most of the principles and guidance in Section PS 3410, and Section PS 3200, Liabilities;
  2. remain unclear as to which stipulations and what level of their specificity give rise to a liability; and
  3. have spent significant time and effort debating issues that only PSAB can clarify.

Authority to pay was not an issue of concern when developing the standard. Most stakeholders did not have difficulty interpreting and applying the guidance. The findings of this Post-implementation Review confirmed that this is an issue primarily in one jurisdiction.
However, divergent practice and different audit opinions on the same set of fact patterns do not serve the public interest or meet users’ needs.

PSAB believes that issuance of authoritative clarifications would be necessary to resolve the different interpretations.

Review the summary on the PSAB's Web site.

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