What are accounting standards for the Public Sector?
Accounting standards are authoritative standards for financial accounting and reporting developed through an organized standard-setting process and issued by a recognized standard-setting body. Accounting standards specify how transactions and other events are to be recognized, measured, presented and disclosed in a public sector entity’s financial statements. The objective of such standards is to meet the needs of users of financial statements by providing the information needed for accountability and decision making.
Accounting standards are the primary source of generally accepted accounting principles (GAAP). The CPA Canada Public Sector Accounting (PSA) Handbook contains accounting standards that apply to all public sector entities (governments, government components, government organizations and certain government partnerships) that issue general purpose financial statements unless specifically directed or permitted to use alternative standards by PSAB. The Appendix to the Introduction to Public Sector Accounting Standards in the PSA Handbook describes which standards apply to various types of public sector entities.