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Section PS 3050 - Loans receivable

Effective date:

April 1, 1993

Published by the PSAB:

April 1993


This Section establishes standards on how to account for and report loans receivable in government financial statements. The standards apply to loans to borrowers outside of the government reporting entity.

A loan receivable is a financial asset of a government (the lender) represented by a promise by a borrower to repay a specific amount, at a specified time or times, or on demand, usually with interest. The amount of a loan that is expected to be recovered from future appropriations should be accounted for in the statement of operations as an expense in the period when a direct relationship can be established between the repayment of the loan and a government's funding to the borrower.

Loans receivable should be initially reported on a government's statement of financial position at cost. Valuation allowances should be used to reflect loans receivable at the lower of cost and net recoverable value.

History of Section PS 3050




April 1993

New Section

This new Section relates to money lent to non-government entities to achieve policy objectives and, to a lesser extent, to earn a return on the use of government funds.

March 2012

Annual improvements

This Section is amended to specify use of the effective interest method when amortizing a loan discount and to specify that the requirement to apply the effective interest method applies in the period Section PS 3450 Financial instruments, is adopted.

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.