The Private Enterprise Advisory Committee assists the Accounting Standards Board (AcSB) with maintaining and improving accounting standards for private enterprises (ASPE) in Part II of the CPA Canada Handbook – Accounting and with identifying the need for non-authoritative guidance about the standards. The Committee makes recommendations to the AcSB but is not authorized to interpret or provide authoritative guidance on ASPE.
The AcSB staff has prepared this document based on discussions held during the Committee’s meeting. The meeting notes do not necessarily represent the AcSB’s views and nothing in them constitutes authoritative guidance on acceptable or unacceptable application of ASPE. Only the AcSB can make such a determination.
ASPE Implementation during the COVID-19 Pandemic
The Private Enterprise Advisory Committee considered the following implementation issues arising during the COVID-19 pandemic:
- Leases: The Committee discussed how lease-modification guidance in Leases, paragraphs 3065.09 -.11, could apply for COVID-19-related payment deferrals and payment waivers. Some Committee members thought clarity from the AcSB on whether the guidance applied for COVID-19-related concessions would benefit stakeholders. The Committee also recommended the Board provide relief from recognizing a new lease if lease-modification accounting applies to COVID-19-related concessions.
- Impairment: The Committee discussed potential challenges with assessing impairment of long-lived tangible assets, intangible assets, and goodwill due to the effects of COVID-19. Some Committee members noted that assessing impairment will be a challenge for enterprises with a calendar year-end due to the possible extent of impairments, but they did not recommend any standard setting.
- Defined Benefit Plans: The Committee discussed whether the effects of COVID-19 would trigger a new valuation for defined benefit plans requiring a valuation sooner than the required three-year cycle. Committee members expected no diversity in practice on this issue and so no clarification in the standards was recommended.
- Other Issues: Members discussed the various government programs to offset the effects of COVID-19 for private enterprises. Committee members recommended standard setting is not necessary to address complexities arising from these programs.
The AcSB will deliberate the Committee’s recommendations at its July 2020 meeting.
Other Topics
The Committee also discussed the results of its member-feedback survey for the 2019-2020 fiscal year.