This site uses cookies to provide you with a more responsive and personalised service. By using this site you agree to our use of cookies. Please read our cookie notice (http://www2.deloitte.com/ca/en/legal/cookies.html) for more information on the cookies we use and how to delete or block them.
The full functionality of our site is not supported on your browser version, or you may have 'compatibility mode' selected. Please turn off compatibility mode, upgrade your browser to at least Internet Explorer 9, or try using another browser such as Google Chrome or Mozilla Firefox.

Section PS 3430 - Restructuring transactions

Effective date:

Restructuring transactions occurring in fiscal years beginning on or after April 1, 2018. Earlier adoption is permitted.

Published by PSAB:

June 2015

Overview

This Section establishes standards on how to account for and report restructuring transactions by both transferors and recipients of assets and/or liabilities, together with related program or operating responsibilities.

Restructuring activities include, but are not limited to:

  1. amalgamation of entities or operations within the government reporting entity;
  2. amalgamation of local governments;
  3. annexation or boundary alteration between neighbouring local governments;
  4. transfers of operations or programs from one entity to another; and
  5. shared service arrangements entered into by local governments in a region.

Restructurings can be initiated by the entities involved or imposed by a higher level of government through legislation or by the controlling government.

History of Section PS 3430

Date

Development

Comments

June 2015

New Section

This new Section defines a restructuring transaction and establishes standards for recognizing and measuring assets and liabilities transferred in a restructuring transaction.

The main features of the new Section are:

  • A restructuring transaction is a transfer of an integrated set of assets and/or liabilities, together with related program or operating responsibilities without consideration based primarily on the fair value of the individual assets and individual liabilities transferred.
  • The net effect of a restructuring transaction should be recognized as revenue or as an expense by entities involved.
  • A recipient should recognize individual assets and liabilities received in a restructuring transaction at their carrying amount with applicable adjustments at the restructuring date.
  • A transferor and a recipient should not restate their financial position or results of operations.
  • A transferor and a recipient should disclose sufficient information to enable users to assess the nature and financial effects of a restructuring transaction on their financial position and operations.

This Section applies to restructuring transactions occurring in fiscal years beginning on or after April 1, 2018. Earlier adoption is permitted.

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

Public Sector Accounting Discussion Group meetings

  • November 17, 2017 - Section PS 3430: Restructuring Transactions – Recipient Adjustments

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.