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PSAB - Concepts Underlying Financial Performance - Measuring Financial Performance in Public Sector Financial Statements [Completed]

Comment period ended on January 31, 2013.

Proposed effective date:

N/A. The PSAB encourages Canadian stakeholders to provide their views on this CP .

Last updated:

June 2013


This is the second Consultation Paper of the PSAB Project entitled “Concepts Underlying Financial Performance”.

The Conceptual Framework Task Force has undertaken a comprehensive review of the concepts that underlie the reporting of financial performance in the general purpose financial statements of public sector entities. A summary of their findings includes the following

  1. public sector entities exist to serve the public. This mandate is the filter through which key characteristics of public sector entities are differentiated from less relevant attributes;
  2. the objective of financial reporting by a public sector entity is to provide information for accountability purposes. Such information aids in understanding and assessing the performance and financial health of the public sector entity;
  3. public sector entities report on their financial accountability to the public and their elected representatives through the provision of information in their financial reports;
  4. financial reports of public sector entities should present information that is useful in evaluating an entity’s financial performance during the accounting period and its financial condition at the end of the accounting period. The financial statements are a fundamental component of the financial reporting of a public sector entity;
  5. broadly, public sector entities are expected to be accountable for: the extent to which the entity performed in accordance with its financial plan, the extent to which current activities/results have an effect on the activities/results of future periods, and the state of the financial condition of the entity; and
  6. more specifically, in the financial statements, public sector entities are expected to demonstrate accountability for eight aspects of financial performance as well as eight other financial aspects primarily related to financial position.

On March 11, 2015, the PSAB’s Conceptual Framework Task Force issued a third Consultation Paper (CP), entitled Conceptual Framework Fundamentals and the Reporting Model. 

Other developments

June 2013

In June 2013, the PSAB received a detailed analysis of the responses to its Consultation Paper and an update on the next steps of the project.

October 2012

On October 11 2012, in connection with the PSAB project, Concepts Underlying Financial Performance (see separate Project item for details) the PSAB’s Conceptual Framework Task Force has issued their second Consultation Paper (CP), entitled Measuring Financial Performance in Public Sector Financial Statements, for comment.

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