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November 19, 2007
PSAB Update and Draft 2009 FIR Update
PSAB Update
Keeping Informed
We have indicated in previous PSAB updates that members can keep up
to date on the work of the Public Sector Accounting Board (PSAB) of the Canadian Institute of
Chartered Accountants (CICA) by signing up for the free notification service on their
website. You might wish to sign up for PSABulletin as an easy way to stay on top
of PSAB developments.
Indicators of Government Financial Position (Statement of
Principles)
At its October meeting, the Board approved a Statement of Principles
(SOP) for Indicators of Government Financial
Condition. As noted in the Chair’s remarks in the
October edition of PSABulletin, the
“SOP proposes definitions and guidance for identifying and
reporting a government’s financial condition. The SOP suggests a
core set of common indicators that would allow for consistent
computation and reporting.”
The Board is seeking comments on the SOP. The deadline for
comments is December 10, 2007. Further information on
this initiative can be found on the status update for this topic.
Assessment of Tangible Capital Assets (Statement of Recommended
Practices)
We have spoken of this project in previous updates and mention it
again here for those that may have missed our previous comments.
In March, 2007, PSAB approved a Statement of Principles for the
assessment of tangible capital assets. The deadline for reporting
comments was June 2007. The objective of the Assessment of Tangible Capital Assets project is
to issue a Statement of Recommended Practice that would:
- assist governments in reporting information about major assets that
is useful in evaluating the government's financial condition and
financial and non-financial performance;
- improve comparability and reliability of financial and non-financial
information about major assets within and across governments; and
- establish specific definition, measurement, presentation
recommendations for providing supplementary information about major
assets.
The Board hopes to issue an Exposure Draft on this topic in November
of 2007 and to approve a final Statement of Recommended Practice in June
of 2008.
What are SORPs?
The following description of Statements of Recommended Practices
(SOPRs) is taken from the Chair’s message of the October edition
of PSABulletin.
The objective of issuing SORPs is to enhance decision making and
accountability by improving the understandability of reports issued in
the public sector. SORPs address specific aspects of reporting on
financial condition and financial and non-financial performance. SORPs
do not form part of generally accepted accounting principles. They are
not prescriptive, but offer general guidance to encourage and assist
public sector entities in effectively reporting relevant information
that is useful in evaluating the entity’s financial condition at
the financial statement date and its financial and non-financial
performance during the reporting period. Compliance with SORPs is not
mandatory, but encouraged, as they supplement and add further depth to
the financial statements.
FIR Update
As you are aware, municipalities will be reporting on their
tangible capital assets beginning with their 2009 financial
statements. To facilitate the new financial reporting framework,
the Ministry of Municipal Affairs and Housing has been working on a
re-designed Financial Information Return (FIR) for 2009. Earlier
drafts have been given limited circulation for comment, and changes have
been made to reflect some of the comments received to date.
The Ministry has just posted the draft 2009 FIR on the FIR website for all
municipalities to view and provide comment. You will receive a
letter from Dana Richardson, Assistant Deputy Minister of Municipal
Affairs and Housing, urging municipalities to review the draft of the
FIR and provide comments by December 14, 2007.
Unlike earlier circulated drafts, this draft also contains 2009 draft
Municipal Performance Measurement Program (MPMP) schedule as well.
We urge you to take the time to look at the various schedules in the
draft FIR and provide your comments. It is preferable to spend
time on this issue now rather than to wrestle with schedules in 2010
that cannot be completed.
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