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
IFRS 9 Post-implementation Review
The AcSB discussed its draft response to the IASB’s (International Accounting Standards Board) Request for Information (RFI), “Post-implementation Review of IFRS 9 Financial Instruments—Impairment.” The IASB’s RFI was issued in May 2023, and comments are due to the IASB by September 27, 2023. In developing its response, the Board considered feedback received from its outreach with 89 interested and affected parties, including users, preparers, practitioners, academics, and regulators. Overall, the Board thinks the impairment requirements in IFRS 9 are working as intended. The Board decided to highlight some application issues that may indicate a need for clarification to the requirements. The Board approved its response for submission to the IASB, subject to drafting changes.
IFRS 15 Post-implementation Review
The AcSB discussed key points to include in its response to the IASB’s Request for Information (RFI), “Post-implementation Review of IFRS 15 Revenue from Contracts with Customers.” The IASB’s RFI was issued in June 2023, and comments are due to the IASB by October 27, 2023. In developing the key points to include in its response letter, the Board considered feedback from 86 interested and affected parties on this topic, including users, preparers, practitioners, and academics. Overall, the Board thinks IFRS 15 is working as intended for contracts within its scope. The Board also decided to highlight some application issues that may indicate a need for clarification to the requirements. The Board will discuss a draft of its response letter at its meeting on October 25, 2023.
Standards for Private Enterprises and Not-for-Profit Organizations
Revenue – Upfront Non-refundable Fees or Payments
The AcSB continued its discussion on feedback received from its Private Enterprise Advisory Committee and Not-for-Profit Advisory Committee on concerns raised with Section 3400, Revenue related to accounting for upfront non-refundable fees or payments. The Board approved an exposure draft to indefinitely defer the effective date of these amendments, with early application permitted, until their Evaluating the Preface project is complete. This exposure draft will also propose a new disclosure requirement for entities recognizing upfront non-refundable fees or payments. The Board expects to issue this exposure draft in November 2023 with a 90-day comment period.
Insurance Contracts with Cash Surrender Value
The AcSB discussed feedback received from its Private Enterprise Advisory Committee and Small Practitioners Working Group on a proposed Accounting Guideline for accounting for insurance contracts with cash surrender value.
The AcSB decided to limit the scope of the proposed Accounting Guideline to accounting treatment of life insurance contracts with cash surrender value by the owner of the life insurance policy. The Board also decided that, to meet the definition of an asset, the owner would also need to be the policy’s beneficiary. Additionally, the Board decided to include a consequential amendment to Section 1582, Business Combinations and Section 4449, Combinations by Not-for-Profit Organizations, to provide exceptions to the fair value measurement requirement. These amendments would require measurement of cash surrender value at the acquisition date at the amount that would be realized by the owner of the policy upon termination of the policy, consistent with the measurement requirement under the proposed Guideline.
The AcSB approved an exposure draft proposing Accounting Guideline AcG-21 Accounting for Insurance Contracts with Cash Surrender Value. The Board expects to issue this exposure draft in November 2023 with a 90-day comment period.
Standards for Not-for-Profit Organizations
Contributions
The AcSB discussed preliminary feedback from outreach activities on the Exposure Draft, “Contributions – Revenue Recognition and Related Matters,” which closed for comment on September 30, 2023. The Board will redeliberate a complete analysis of all feedback on the Exposure Draft starting at its November 2023 meeting. As part of this redeliberation, the Board will consider the next steps and timeline for this project.
Reporting Controlled and Related Entities
The AcSB received an update on the discussions held by its Not-for-Profit Advisory Committee at its May 2023 and July 2023 meetings regarding staff research on the definitions and disclosure requirements of controlled and related entities. The research is part of the Board’s project – Research Improvements to Section 4450, Reporting Controlled and Related Entities by Not-for-Profit Organizations.The AcSB discussed the feedback received from the Not-for-Profit Advisory Committee and directed staff to first focus its research activities on the disclosure requirements in Section 4450, Reporting Controlled and Related Entities by Not-for-Profit Organizations. Research on the definitions in Section 4450 will follow, subject to the findings of the research on disclosure requirements.
Standards for Pension Plans
Research Improvements to Part IV
The AcSB discussed feedback from its Pension Plan Working Group regarding investment presentation and disclosure matters in Section 4600, Pension Plans.
The AcSB discussed options to improve the presentation and disclosure of investment expenses. The Board tentatively decided to require separate presentation of administrative expense categories between investment expenses and pension administration and other expenses. The Board also provided feedback on a proposed definition of investment expenses to be included in Pension Plans, paragraph 4600.05. The Board discussed options for disclosures related to investment expenses and tentatively decided that additional qualitative disclosure related to what is included in investment expenses would be useful to users.
In addition, the AcSB discussed ways to improve transparency on a pension plan’s interests in investment funds and other structured entities. The Board is considering introducing a principle-based requirement to disclose information that enables users to understand the nature and extent of a pension plan’s interests in these entities and the associated risks.
The AcSB will seek feedback on these potential solutions at its November 2023 Pension Plan Working Group meeting.
Relevance of Financial Reporting
Scaling the Standards
The AcSB discussed feedback received from over 150 interested and affected parties on its “Consultation Paper I – Exploring Scalability in Canada” which closed for comment on July 31, 2023.
Based on the feedback received, the AcSB decided not to pursue an intermediary accounting framework option between IFRS Accounting Standards and Parts II and III of the CPA Canada Handbook – Accounting. The Board agreed on additional research and continued targeted consultation on options for possible tiering within the existing Part II and Part III frameworks. They also discussed a potential new framework for small entities.
The AcSB was not asked to make any final decisions regarding these scaling options and will discuss the next steps for this project at the Board’s October 2023 meeting.
Work Plan Survey on Priorities
The AcSB provided feedback on the final draft of its Domestic Work Plan Survey on potential new domestic projects to explore in the 2024-2025 fiscal year and beyond. Subject to comments received, the Board approved the survey for publishing. The survey was published on October 10, 2023, and will be open to respondents until November 30, 2023.
Governance
Annual Plan
The AcSB received an update on activities in its 2023-24 Annual Plan. Based on its progress to date, the Board plans to start gathering information on longer-term project priorities. One of these priorities is advancing understanding on reporting challenges related to goodwill and intangible assets accounting for private enterprises and not-for-profit organizations.
The AcSB also observed that the accounting for carbon credits is an emerging issue in practice. The Board is in discussions with other national standard-setters on this topic and decided to add carbon credits to its priorities list. The Board will perform further research on this issue to inform its discussions internationally.
The Board will begin its process for developing next year’s annual plan at its December 2023 meeting, which includes considering forthcoming feedback on its Domestic Work Plan Survey.
Terms of Reference, Statement of Operating Procedures, and Due Process Manual
The AcSB commenced the review of its Terms of Reference, Statement of Operating Procedure, and Standard-Setting Due Process Manual, which it performs once every three years or on an as-needed basis.
The AcSB considered improvements to its voting process and updates to its responsibilities to reflect the strategies in its 2022-2027 Strategic Plan. In addition, the Board discussed recommendations from the Independent Review Committee on Standard Setting in Canada – specifically those related to connecting with interested and affected parties, timeliness, and transparency. While the Board has been carrying out some of these recommendations to a certain degree, it will continue to improve its processes to better respond to the needs of interested and affected parties. For example, the Board is expanding its decision summaries to provide greater transparency on the key factors considered in its decision-making process and is exploring new ways to broaden its reach. The Board will also discuss its role in providing non-authoritative guidance for parties that apply Parts II, III, and IV of the CPA Canada Handbook – Accounting, at its November 2023 meeting.
The AcSB will continue discussions on its Terms of Reference, Statement of Operating Procedures, and Standard-Setting Due Process Manual at its January 2024 meeting.
Due Process
AcSB’s Advisory Committees and Working Groups
IFRS® Accounting Standards Discussion Group
The AcSB received an update on the September 19, 2023, IFRS® Accounting Standards Discussion Group meeting. At this meeting, the Group discussed Accounting for the Development of Carbon Credits by a Renewable Energy Generator, Unit of Account for Lease Modification Accounting, Accounting for Equity Instruments in a Shares-for-Debt Transaction, and Classification of Liabilities with Covenants when an Entity is Granted a Waiver or Grace Period.
Private Enterprise Advisory Committee
The AcSB received an update on the July 26, 2023, Private Enterprise Advisory Committee meeting. At this meeting, the Committee discussed Insurance Contracts with a Cash Surrender Value, Revenue – Upfront Non-Refundable Fees or Payments, and Scaling the Standards.
Not-for-Profit Advisory Committee
The AcSB received an update on the July 25, 2023, Not-for-Profit Advisory Committee meeting. At this meeting, the Committee discussed Contributions, Reporting Controlled and Related Entities for Not-for-Profit Organizations, and Scaling the Standards.
Small Practitioners Working Group
The AcSB received an update on the September 6, 2023, Small Practitioners Working Group meeting. At this meeting, the Group discussed Contributions.