PSAB - Withdrawal of Disclosure of Related Party Transactions by Not-for-Profit Organizations, Section PS 4260 [Completed]
Proposed effective date: |
The PSAB intends that, for NFPOs that apply the PSA Handbook with Sections PS 4200 to PS 4270 to prepare their financial statements, PS Section 4260 will be withdrawn and PS Section 2200 will instead apply for fiscal years beginning on or after April 1, 2017. Earlier adoption of PS Section 2200 is be permitted. Section PS 2200 is to be applied prospectively. The PSAB issued the filing instruction to withdraw Section PS 4260 from the PSA Handbook in December 2016. |
Last updated: |
December 2016 |
Overview
Principle 12 of the Statement of Principles, “Improvements to Not-for-Profit Standards,” jointly issued by PSAB and the Accounting Standards Board in April 2013, states that a not-for-profit organization (NFPO) applying the PSA Handbook including the guidance specific to not-for-profit organizations (the PS 4200 series) should continue to apply Section PS 4260, Disclosure of Related Party Transactions by Not-for-profit Organizations, pending completion of PSAB’s Related Party Transactions project.
PSAB’s Related Party Transactions project was completed and Section PS 2200, Related Party Disclosures, was issued in March 2015. Sections PS 2200 and PS 4260 are very similar. While some minor terminology differences exist, the basic intent of each Section is the same.
While Section PS 2200 does not include the notion of significant influence or economic interest, NFPOs that apply the PSA Handbook including the PS 4200 series can find similar disclosure requirements for these concepts in Section PS 4250, Reporting Controlled and Related Entities by Not-for-profit Organizations.
The PSAB intends that, for NFPOs that apply the PSA Handbook with Sections PS 4200 to PS 4270 to prepare their financial statements, Section 2200 would apply to fiscal years beginning on or after April 1, 2017. Earlier adoption would be permitted. The Section would be applied prospectively.
In September 2016, the PSAB approved the withdrawal of Section PS 4260, Disclosure of Related Party Transactions by Not-for-Profit Organizations.
Other developments
December 2016
In December 2016, CPA Canada issued the filing instruction to withdraw Section PS 4260 from the PSA Handbook.
April 2016
In April 2016, the staff of the PSAB updated the information in respect of this project to advise that the PSAB expects to issue the final Handbook amendments in Q4/2016.
January 2016
On January 21, 2016, the Public Sector Accounting Board (PSAB) issued an Exposure Draft proposing to withdraw Section PS 4260 and add a transitional provision to Section PS 2200, Related Party Disclosures. Stakeholders are encouraged to submit their comments by April 29, 2016.