Section 3260 - Reserves

Effective date:

January 1, 2011

Published by the AcSB:

December 2009


This Section establishes recognition and presentation standards in respect of accounting for reserves. The use of the term "reserve" shall be limited to an amount that, though not required to meet a liability or contingency known or admitted or a decline in value that has already occurred as at the balance sheet date, has been appropriated from retained earnings or other surplus:

  1. at the discretion of management (for example, reserve for future decline in inventory values, reserve for general contingencies, reserve for future plant extension); or
  2. pursuant to the requirements of a statute, the instrument of incorporation or by-laws of a company or a trust indenture, or other agreement (for example, sinking fund reserve, general reserve, preferred stock redemption reserve).

History of Section 3260




December 2009

Part II of the CPA Canada Handbook issued

Effective for fiscal years beginning on or after January 1, 2011.

Note: The above summary does not include details of consequential amendments made as the result of other projects.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.