This summary of Accounting Standards Board (AcSB) decisions has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussion on projects, which may change after further deliberations by the Board. Decisions to publish Handbook material are final only after a formal ballot process.
The AcSB will respond to change and reprioritize when necessary, ensuring we can address implementation challenges and provide the information users may need in these unique circumstances.
The AcSB values input and feedback from stakeholders and can be reached anytime through our online form.
IFRS® Accounting Standards
Financial Instruments with Characteristics of Equity
The AcSB discussed its plan to respond to the International Accounting Standards Board’s (IASB) Exposure Draft, “Financial Instruments with Characteristics of Equity,” which was issued on November 29, 2023, with comments due to the IASB by March 29, 2024. The Board approved outreach and communications plans, which include gathering feedback from advisory committees, public roundtables, and targeted outreach with representatives from industries that are expected to be impacted by these proposals. More information on public events will be shared on the Board’s project page in the coming weeks.
Annual Improvements to IFRS Standards
The AcSB approved its response letter to the IASB’s Exposure Draft, “Annual Improvements to IFRS Accounting Standards ̶ Volume 11,” subject to final editorial comments.
Standards for Not-for-Profit Organizations
Contributions
Exposure Draft feedback
The AcSB began redeliberating the feedback on its Exposure Draft, “Contributions – Revenue Recognition and Related Matters.” The Board’s discussion focused on topics related to the project’s purpose, the definition of a restricted contribution, and the recognition of restricted contributions.
As set out in the Exposure Draft, the project’s original purpose focused on reducing complexity, enhancing comparability, and improving the decision usefulness of not-for-profit financial statements by removing the accounting policy choice for recognition of contributions. The AcSB discussed how financial statements are an important tool to assess the stewardship and transparency of not-for-profit organizations (NFPOs), and that these factors must be included as critical considerations in reaffirming the project’s objective and determining the options for its next steps.
The AcSB discussed feedback on the definition of “restricted contributions” and recognition of revenue from restricted contributions. This discussion focused on the concerns some respondents had about the usefulness of the information provided if the Exposure Draft proposals were applied and whether these proposals aligned with the underlying financial statement concepts. In particular, the Board considered the needs of financial statement users and identified this as an area where further information gathering and outreach should be undertaken.
Potential options to address the feedback, including guidance in other jurisdictions
The AcSB received an overview of accounting for contributions in other jurisdictions that have accounting standards specific to NFPOs, including international non-profit accounting guidance, U.S. generally accepted accounting principles (GAAP), and U.K. GAAP. The Board discussed whether aspects of the guidance in other jurisdictions could be considered to address feedback on the Exposure Draft proposals.
The AcSB discussed a variety of options to address the feedback on the proposed approach for recognition of restricted contributions, ranging from modifying the presentation and disclosure requirements in the existing proposals, to entirely new approaches for the recognition of restricted contributions. The Board also considered its Not-for-Profit Advisory Committee’s feedback on the options. After weighing the pros and cons of the various options, the Board directed staff to conduct further outreach on a narrowed set of options. This outreach will seek input on whether the options being considered would address the concerns some respondents had regarding the Exposure Draft proposals, while still meeting the needs of those respondents who had provided support for the proposals.
Next steps
The AcSB discussed next steps for this project, considering the effect that the Exposure Draft feedback had on the original project timeline. This original timeline had proposed working toward a final standard in mid-2024. Recognizing the importance of taking time to ensure that the feedback on the Exposure Draft is sufficiently addressed, the Board decided to defer the project timeline to allow time for further outreach and consultation with the not-for-profit sector on the best option to move forward.
Discussions on this project will continue with the Not-for-Profit Advisory Committee at its December 2023 meeting. The AcSB will discuss the Committee’s feedback and the results of other targeted outreach with the not-for-profit sector at its January 2024 meeting. Further updates on the project timeline will be provided following that meeting.
Due Process
AcSB’s Advisory Committees and Working Groups
Private Enterprise Advisory Committee
The AcSB received an update on the November 8, 2023, Private Enterprise Advisory Committee meeting. At this meeting, the Committee discussed subsequent measurement of goodwill and recognition of acquired intangible assets, scaling the standards, amendments to frameworks in other jurisdictions, and the AcSB’s 2024-2025 Annual Plan. Please see the Private Enterprise Advisory Committee Meeting Notes – November 8, 2023 for details.
Not-for-Profit Advisory Committee
The AcSB received an update on the November 1-2, 2023, Not-for-Profit Advisory Committee meeting. At this meeting, the Committee discussed contributions, reporting controlled and related entities, scaling the standards, amendments to frameworks in other jurisdictions, and the AcSB’s 2024-2025 Annual Plan. Please see the Not-for-Profit Advisory Committee Meeting Notes – November 1-2, 2023 for details.
Pension Plan Working Group
The AcSB received an update on the November 9, 2023, Pension Plan Working Group meeting. At this meeting, the Group discussed the Board’s current project on researching improvements to the presentation and disclosure of investments for pension plans. As part of this, the Group discussed proposals for the presentation and disclosure of investment expenses, as well as for disclosures on interests in investment vehicles. It also discussed governance matters and potential future projects in Part IV of the CPA Canada Handbook – Accounting Standards for Pension Plans, should the Board have capacity. Finally, the Group provided feedback to CPA Canada's Independence Standing Committee on their preliminary view that certain pension plans be included as a category of public interest entities for the purpose of Canadian Independence Standards.
Small Practitioners Working Group
The AcSB received an update on the October 26, 2023, Small Practitioners Working Group meeting. At this meeting the Group discussed challenges with subsequent measurement of goodwill and recognition of acquired intangible assets. Group members expressed interest in reintroducing amortization of goodwill and combining acquired intangible assets with goodwill when a business acquisition occurs. The Group also provided feedback on application issues related to uncertain tax treatments. Finally, the Group provided feedback on scalability and the areas of accounting standards for private enterprises that Group members think are too complex.
Governance
AcSB’s Strategic Priorities
The AcSB held a strategic session to discuss its role related to guidance. The Board discussed different types of guidance, the criteria to determine if it should produce guidance on a specific topic, and the need for a framework for deciding on when and what type of guidance should be issued.