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.
AcSB’s 2022-2027 Draft Strategic Plan
The Private Enterprise Advisory Committee received an overview of the proposals in the AcSB’s 2022-2027 Draft Strategic Plan. The Committee discussed the proposals relating to accounting standards for private enterprises (ASPE), including the preface and scalability of the standards, and reporting beyond traditional financial statements.
The Committee provided the following feedback on the AcSB’s proposed strategies:
- To better meet stakeholders’ needs, it would be useful to reconsider certain aspects of the preface that require certain types of entities to apply a given part of the Handbook.
- Given the range of private enterprises in Canada, scaling the standards would help better meet the needs of large and small enterprises.
- Certain GAAP requirements do not meet users’ needs in some circumstances. Therefore, scaling the standards could help better meet users’ needs.
- Currently, few private enterprises report information outside their financial statements. However, given the changing environment and the growing demand for information related to sustainability, Committee members agreed with the AcSB’s proposal to demonstrate leadership in reporting beyond traditional financial statements.
The Committee members were also reminded that the comment deadline is October 15, 2021. Stakeholders can submit responses and provide feedback through the online community platform, Connect.FRASCanada.ca, and by attending a roundtable event.
The AcSB will consider the Committee’s comments when the Board begins deliberating the feedback received on its Draft Strategic Plan at the Board meeting on October 13-14, 2021.
Implementation of ASPE during the COVID-19 Pandemic
The Private Enterprise Advisory Committee discussed financial reporting issues arising from the COVID-19 pandemic. The Committee noted the following for the AcSB’s consideration:
- There is an increased demand in practice for audited and reviewed interim financial statements; and
- Practitioner members observe that the note disclosure related to the impact of the COVID-19 pandemic is generic in nature and may not be relevant to financial statement users.
The AcSB will consider the Committee’s comments at the Board meeting on September 15-16, 2021.