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Accounting Standards for Private Sector Not-for-Profit Organizations

Improvements to Section 4450 Reporting Controlled and Related Entities by Not-for-Profit Organizations

Summary

The Accounting Standards Board (AcSB) initiated a project to make improvements to Section 4450, Reporting Controlled and Related Entities by Not-for-Profit Organizations. The project aims to improve transparency on financial statements for users reviewing the relationship entities have with related and controlled entities. It includes:

  • amending Section 4450 to improve the disclosures related to controlled and related entities;
  • introducing illustrative examples to assist in the application of the definitions of control, significant influence, and economic interests in not-for-profit organizations in Section 4450; and
  • revisiting current definitions of control, significant influence, and economic interests held in not-for-profit organizations, if necessary, based on any relevant learnings gained from the development of illustrative examples.

The project will not include changes to the choice between consolidating and disclosing controlled entities for not-for-profit organizations, as described in Reporting Controlled and Related Entities by Not-for-Profit Organizations, paragraph 4450.14.

Staff Contact(s)

Matthew Bishop, CPA, CA Principal, Accounting Standards Board

Phone number  +1 647 264 7070
Email address  [email protected]
Amanda Winter, CPA, CA Principal, Accounting Standards Board

Phone number  +1 416 204 3241
Email address  [email protected]

Project Status

  • Information gathering

    The AcSB conducted research into how to improve the transparency of financial statements for users reviewing the relationship entities have with related and controlled entities

  • Approving project

    In March 2024, the AcSB approved a project to make improvements to Section 4450

  • Engaging Communities
  • Deliberating feedback
  • Final pronouncement

On-demand Webinar – Domestic Accounting Standards Update (Fall 2024)

Watch our recorded webinar to learn about current projects and recent amendments in Parts II, III, and IV of the CPA Canada Handbook – Accounting.

This webinar aired live in November 2024 and is now available on-demand.

Watch now

On-demand Webinar – Domestic Accounting Standards Update (Spring 2024)

Watch our recorded webinar to learn about current projects and recent amendments in Parts II, III, and IV of the CPA Canada Handbook – Accounting.

English – On-demand webinar
French – On-demand webinar

Meeting & event summaries

October 21, 2024

Not-for-Profit Advisory Committee Meeting Notes – October 21-22, 2024

The Not-for-Profit Advisory Committee discussed the AcSB’s project to make improvements to Section 4450, Reporting Controlled and Related Entities by NFPOs. This project seeks to improve the transparency for financial statement users when reviewing the relationships organizations have with related and controlled entities.

The Committee discussed the AcSB’s decision to expand the scope of the project to include re-evaluating the approach for identifying and assessing relationships with related entities in Section 4450 and other options to simplify the application of the standard. The Committee also discussed potential approaches to be explored in a consultation paper for identifying and assessing relationships between NFPOs, as well as relationships between NFPOs and for-profit enterprises.

The Committee will continue discussing topics to be explored in a consultation paper at a future meeting.

Disclaimer

This project summary has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on this project, which may change after further Board deliberations. Decisions to publish Handbook material are final only after a formal voting process.