Ian Seymour Elected President - The Institute of Chartered ...

Accounting Standards for Private Enterprises
New accounting standards for private companies take an
important step forward
Much attention has been focused on the 2011
adoption of International Financial Reporting
Standards (IFRS) for publicly accountable
enterprises but Canadian standards setters
recognize that IFRS might not meet the needs
of all private companies.
“The AcSB recognizes that one size does not
necessarily fit all. While some private businesses
will opt to report under IFRS, the majority will
prefer to adopt a more straightforward set of
standards specifically tailored to address private
business issues,” said Ron Salole, Vice-President,
Standards - Canadian Institute of Chartered
Accountants
The AcSB’s proposed changes to Private
Company GAAP are outlined in a recent
Exposure Draft Generally Accepted Accounting
Principles for Private Enterprises. This Exposure
Draft puts forward a separate set of accounting
standards focused on private enterprises.
“The proposed standards focus on the
needs of users of private enterprises financial
statements and take into account the difficulties
private companies face in applying complex
accounting standards,” said Greg Edwards,
Principal with the AcSB responsible for private
enterprise issues.
“They include simplified recognition and
measurement standards for several complex
accounting issues, including financial
instruments, and substantially reduced
disclosure requirements.”
Congratulations!
Chartered Accountant William H. Loewen and his wife Shirley E.
Loewen were recipients of the Winnipeg Arts Council Arts Champion
Award.
The Award was presented by Councillor Gord Steeves, on behalf of
Mayor Sam Katz at the Mayor’s Luncheon for the Arts on June 11,
2009.
The Arts Champion Award honours an individual or business patron
that has demonstrated sustained support to the arts in Winnipeg.
For decades, William and Shirley Loewen have supported the arts
in Winnipeg. They were nominated by the Winnipeg Symphony
Orchestra, The Manitoba Opera, and the Manitoba Theatre Centre.
Congratulations to Bill and Shirley who received a unique work by
Winnipeg artist Jeanette Johns.
Pictured on the right, Gord Steeves (left) presents Shirley and Bill Loewen,
FCA with the Winnipeg Arts Council Arts Champion Award.
FOLIO 4
Go to www.acsbcanada.org/edpegaap to
view the Exposure Draft. Comments are to be
received by July, 31 2009.
Senior level AcSB and CICA staff are
participating in various events across the
country to raise public awareness of the
proposed standards and encourage stakeholder
input on the exposure draft.
For more information see the cover story in
CAmagazine (May) Private Matters and visit
the CICA’s Canadian Standards in Transition
website for developing orientation and training
materials.
Updates on the deliberations will be made
public on AcSB’s website (www.acsbcanada.org)
following the comment deadline.
Overview
The proposed standards are built from the
existing CICA Handbook– Accounting, which
will be familiar to many users thereby not
requiring extensive education or training.
Change on recognition and measurement
issues is limited to areas of most concern
to stakeholders, most notably: financial
instruments; employee future benefits; asset
retirement obligations; internally developed
intangible assets; impairment testing for
goodwill and other intangible assets; and, stockbased
compensation.
Other major changes include elimination of
EIC Abstracts as they currently exist, deletion of
sections and guidelines thought to be generally
irrelevant to this sector, and a total refocus of
disclosure requirements.
The new standards aim to reduce the number
of specific disclosure requirements (reduced
by approximately one-half as compared to
the existing Handbook) while still providing
sufficient information to give a fair presentation
of an enterprise’s financial position and
operating results.
The Exposure Draft also contains a new
section that sets out transitional provisions
for first-time adoption of the proposed
standards. Section 1500, First-time Adoption, is
designed to ensure an enterprise’s first financial
statements prepared in accordance with the
new standards contain high-quality information
that is transparent and comparable, provide a
suitable starting point for accounting under
new standards, and can be generated at a cost
that does not exceed the benefits to financial
statements users.
The proposed standards would be effective
for annual financial statements relating to fiscal
years beginning on or after January 1, 2011, but
early adoption would be permitted.
The AcSB expects that the final standards will
be issued in time for use for 2009 calendar-year
end financial statements. They will be available
to any private enterprise. No size threshold or
other barriers, such as unanimous consent by
shareholders of other users, will be imposed.