This summary of decisions of the Public Sector Accounting Board (PSAB) has been prepared for information purposes only. Decisions reported are tentative and reflect only the current status of discussions on projects, which might change after further deliberations by PSAB. Decisions to publish exposure draft and Handbook material are final only after a formal ballot process.
For more detailed information about PSAB projects, please refer to the project summaries under Projects. |
Future Projects - PSAB asked staff to prepare four project proposals to be considered in the 2012-2013 fiscal year:
- a standards project on asset retirement obligations;
- a standards project on service concession arrangements;
- a standards project on impairment of non-financial assets; and
- a research report on long term fiscal sustainability.
Defined Benefit Pension Accounting PSAB received a presentation on accounting for defined benefit pensions. PSAB asked staff to assess the various changes under development or issued by other standard setters and whether PSAB should consider changing its standards. The Board requested that the analysis include identification of areas where the standards in the CICA Public Sector Accounting (PSA) Handbook, in Section PS 3250, Retirement Benefits, and Section PS 3255, Post-Employment Benefits, Compensated Absences and Termination Benefits, are different from the standards under revision or other issued standards. Revenues PSAB approved an amended project proposal on revenues. The Board agreed that the need for the project is still compelling. It also agreed with the nature and extent of the issues to be addressed, the composition of the task force, the extent of the resources to be allocated to the project, the associated communications plan and the proposed timing. The existing guidance in the PSA Handbook addressing the application of the definition of revenues is quite limited, and public sector entities have many revenue sources beyond those covered in detailed standards in the PSA Handbook. PSAB has not initiated the project to review its current standards; rather it aims to put in place overarching guidance to address when revenues are recognized, and how they are measured and presented in financial statements. - While the work of other standard setters will serve as a resource, PSAB has determined that specific issues need to be deliberated as public sector entities:
- receive certain types of revenue derived from granting a right or privilege that only a government can authorize;
- levy fines and penalties under the authority of legislation; and
- often price goods or services with the aim of promoting access rather than to maximize the economic return.
Stakeholder Survey PSAB reviewed a draft survey to be sent to stakeholders. This survey assists PSAB’s oversight body, the Accounting Standards Oversight Council (AcSOC), in assessing PSAB’s performance. It also helps PSAB to identify ways to better meet the needs of its stakeholders. PSAB suggested some additional questions and amendments to the survey. The survey is expected to be issued in late October 2011. AcSOC and PSAB look forward to your feedback. Appropriations - PSAB had an extensive discussion of the merits of the proposals in a draft Statement of Principles on accounting for appropriations. As a result, the Board narrowed the application of the proposed principles to appropriations of entities that:
- are required by law or other authority to prepare and present general purpose financial statements (as contrasted with special purpose financial reports);
- are required under legislation or other authoritative requirements to base their accounting policies on the PSA Handbook; and most importantly,
- access their funding directly under the authority of an appropriation.
The proposed principles would not apply to entities that receive their funding through a transfer payment (i.e., those that actually receive and manage the disbursement of the funds). Those entities would apply the principles in Section PS 3410, Government Transfers. Notwithstanding further review by PSAB and the Related Party Transactions Task Force, PSAB generally agreed with the direction taken in the proposals that appropriations should be reported in general purpose financial statements. Similarly, the Board also generally agreed with the direction taken in the proposals that appropriations would be recognized when the authority related to the appropriations had been enacted and, in effect, an eligible expenditure had been incurred. However, it debated the options for how appropriations should be recognized (i.e., as revenue in the statement of operations or as an equity or other transaction in the statement of financial position). PSAB asked the Task Force to do further analysis of the pros and cons of the options for consideration by the Board. Proposed principles on recognition criteria and disclosure requirements were reviewed and positive feedback was provided to the task force. A revised draft statement of principles will be considered by PSAB at its December 2011 meeting. PSAB Work Plan 2012-13 PSAB reviewed a draft work plan for its April 1, 2012 — March 31, 2013 fiscal year. The Board discussed the adequacy of resources available to meet the proposed plan, the allocation of resources, the objectives of the plan, the activities set out in the plan and the proposed indicators of performance. The Board discussed ongoing communications with key stakeholder groups and the allocation of resources to them. Although PSAB asked staff to explore some of the elements of the plan in more detail, the Board was generally supportive of the plan. Further discussion on the work plan will take place at the December 2011 meeting. Concepts Underlying Financial Performance PSAB received a presentation on the Conceptual Framework Task Force’s Consultation Paper 1, issued in August 2011. The Board discussed the proposed characteristics of public sector entities and provided some feedback to be taken back to the Task Force. |
