Detailed Review of Accounting Standards for Private Enterprises

The Private Enterprise Advisory Committee continued the discussion from its July 2024 meeting regarding application issues in Section 3856, Financial Instruments, that might be addressed through this project. The Committee also discussed application issues for the second batch of selected ASPE standards that included Section 3063, Impairment of Long-lived Assets, and Section 3065, Leases. The AcSB will discuss this feedback at its December 2024 meeting and will seek feedback on additional application issues from its Private Enterprise Advisory Committee and Medium and Small Practitioners Advisory Committee at the meetings in Q1 2025.

The Not-for-Profit Advisory Committee discussed application issues for not-for-profit entities applying the requirements in Section 3063 Impairment of Long-lived Assets, Section 3065, Leases, Section 3400, Revenue, Section 3462, Employee Future Benefits, and Section 3840, Related Party Transactions, that might be addressed through the AcSB’s Detailed Review of ASPE project. The AcSB intends to use this feedback to help draft a consultation paper. The Board will discuss the Committee’s feedback at its December 2024 meeting.

The AcSB continued its discussions on its detailed review of Accounting Standards for Private Enterprises (ASPE). The discussion focused on feedback received at the July 2024 meetings of its Private Enterprise Advisory Committee, Not-for-Profit Advisory Committee, and Small Practitioners Working Group on the Board’s approach to scoping the issues to consider through this project, and the identified issues for the Part II of the CPA Canada Handbook ̶ ASPE standards for inventories, asset retirement obligations, and financial instruments. The feedback supported the scoping approach approved by the Board at its June 2024 meeting.

The AcSB also provided input on the information needed on the second batch of Part II standards, which includes the standards on impairment of long-lived assets, leases, and related party transactions. This second batch of standards will be discussed at the October and November 2024 meetings of the Private Enterprise Advisory Committee, the Not-for-Profit Advisory Committee, and the Small Practitioners Working Group. The Board will consider this feedback at a future meeting as it works to develop a consultation paper for this project.

The Not-for-Profit Advisory Committee discussed the AcSB’s approach for determining which issues will be addressed through the Detailed Review of Accounting Standards for Private Enterprises (ASPE) project. Committee members generally agreed with the proposed approach for defining the project’s scope, noting it would ensure the project focuses on the most significant and pervasive challenges that can be addressed without negatively impacting the quality of information provided to users.

The Not-for-Profit Advisory Committee also discussed application issues for not-for-profit entities applying the requirements in Section 3031, Inventories, Section 3110, Asset Retirement Obligations, and Section 3856, Financial Instruments, in Part II of the CPA Canada Handbook – ASPE that might be addressed through this project. The AcSB intends to use this feedback to help draft a consultation paper. The Board will discuss this feedback at its September 2024 meeting and will continue discussions on additional topics with the Private Enterprise Advisory Committee, Not-for-Profit Advisory Committee, and Small Practitioners Working Group at the meetings in October and November 2024.

The Private Enterprise Advisory Committee discussed the AcSB’s approach for determining which issues will be addressed through this project. Committee members generally agreed with the Board’s proposed approach for defining the project’s scope, as they thought it would ensure the project focuses on the most significant and pervasive challenges that can be addressed without negatively impacting the quality of information provided to users. The Committee also discussed application issues in Section 3031, Inventories, Section 3110, Asset Retirement Obligations, and Section 3856, Financial Instruments,in Part II of the CPA Canada Handbook – Accounting Standards for Private Enterprises (ASPE) that might be addressed through this project. The Board intends to use this feedback to help draft a consultation paper. The Board will discuss this feedback at its September 2024 meeting and will seek feedback on additional application issues from the Private Enterprise Advisory Committee, Not-for-Profit Advisory Committee, and Small Practitioners Working Group at their meetings in October and November 2024.

The AcSB discussed the scope of its Detailed Review of Accounting Standards for Private Enterprises. The Board approved an approach to determine which issues will be addressed as part of this project. The approach aims to ensure the project focuses on issues that arise from unnecessarily complex, onerous, and/or costly requirements in Part II of the CPA Canada Handbook - Accounting, considering the needs of and benefits to financial statement users. The approach seeks to capture only the most significant and pervasive issues within the scope of this project. Additionally, the approved approach clarifies the types of issues that will be addressed through the Board’s guidance framework for domestic standards rather than through this project.