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 Foundation Trademarks
The AcSB discussed the use of the IFRS trademark, specifically references to IFRS Accounting Standards. The AcSB notes that the International Accounting Standards Board (IASB) has not indicated that it would comprehensively replace references to “IFRSs” with “IFRS Accounting Standards” in current requirements. The AcSB expects the IASB will refer to “IFRS Accounting Standards” instead of “IFRSs” in newly developed standards and amendments. For example, the IASB’s primary financial statement project will be finalized next year. As such, the IASB will replace International Accounting Standard (IAS) 1 Presentation of Financial Statements in Part I of the CPA Canada Handbook ̶ IFRS Standards by moving most of IAS 1 to a new standard, and some parts of IAS 1 will move to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. The AcSB expects any reference to “IFRSs” will be updated to “IFRS Accounting Standards,” including in paragraph 7 in Definitions and the statement of compliance currently located paragraph 16 of the IAS 1.
Introduction to Part I in Part I of the Handbook is written and maintained by the AcSB. As such, the Board will update references from “IFRS Standards” to “IFRS Accounting Standards” in line with the changes being made as detailed above, including the basis of accounting in paragraph I.13.
Financial Instruments with Characteristics of Equity
The AcSB received an education session on the IASB’s Exposure Draft, “Financial Instruments with Characteristics of Equity.” The IASB’s Exposure Draft was issued on November 29, 2023, and comments are due March 29, 2024. Entities are increasingly entering into business combinations, share buybacks, and more complex financing transactions such as issuing convertible debt or debt with contingent features. The proposals in the Exposure Draft may impact the accounting for elements of such transactions. Therefore, the AcSB expects the Exposure Draft to have an impact beyond the banking industry, including on entities in the energy, utilities, mining, and other sectors. The AcSB plans to conduct public outreach to inform its response. More information on outreach events will be shared on the AcSB’s project page in the coming weeks, including a public roundtable.
IFRS Interpretations Committee Tentative Agenda Decisions
The AcSB discussed an approach for deciding when and how to respond to Tentative Agenda Decisions that are periodically issued by the IFRS Interpretations Committee. In making these decisions, the Board discussed that it would consider factors such as whether a given matter is pervasive in Canada, and whether the related agenda decision would have a significant impact on Canadian entities.
The AcSB then considered the two Tentative Agenda Decisions issued in early December 2023:
Based on the considerations above, the AcSB decided that it will respond to both Tentative Agenda Decisions. The Board will seek feedback from its IFRS Interpretations Committee Member Support Group and IFRS Accounting Standards Discussion Group to inform its response letters. At its January 2024 meeting, the Board plans to review and approve its response letters, to be submitted by the February 5, 2024, deadline.
Standards for Private Enterprises
Revenue Application Issues
The AcSB discussed application questions related to the amendments to Section 3400, Revenue, in Part II of the CPA Canada Handbook – Accounting Standards for Private Enterprise, issued in November 2021, which were effective as of January 1, 2022. The Board considered whether guidance was needed to clarify the amendments. The original discussion took place during the June 2023 AcSB meeting. However, several requests were subsequently received to provide more transparency to the judgments that an entity would need to make to apply the requirements in Section 3400 in these examples. In order to be responsive, in the AcSB Fall Domestic Standards Update Webinar, the presenters provided some helpful things to consider, including areas in which judgment would be required. The recording of the webinar and its transcript, which includes the comments on these revenue issues, are available in both English and French.
Standards for Pension Plans
Research Improvements to Part IV
The AcSB discussed feedback received from its Pension Plan Working Group regarding investment presentation and disclosure matters in Section 4600, Pension Plans. The discussion focused on proposed disclosure requirements on interests in investment vehicles and amended presentation and disclosure requirements on investment expenses.
The AcSB then approved a project proposal to amend Section 4600 to reflect these improvements as well as to update the requirements for fair value disclosures. The Board will explore and refine these proposals with the Pension Plan Working Group at its next meeting in February 2024.
Due Process
AcSB’s Advisory Committees and Working Groups
IFRS Accounting Standards Discussion Group
The AcSB received an update on the December 12, 2023, IFRS Accounting Standards Discussion Group meeting. At this meeting, the Group discussed Revenue Recognition for Carbon Credits, Classification of Liabilities with Covenants when an Entity is Granted a Waiver or Period of Grace, and Year-end Financial Reporting Reminders.
Engaging Academics in Standard Setting
The AcSB considered staff’s proposals to engage academics in the standard-setting process. The Board discussed initiatives that other national standard-setters are pursuing, the need to engage with academics using various research approaches, and the challenges in accessing data for non-listed entities. The Board was not asked to make decisions.
Governance
AcSB’s Annual Plan
The AcSB discussed an initial draft of its annual plan for the fiscal year beginning on April 1, 2024, including a reassessment of the Board’s key risks.
The AcSB considered feedback from the Private Enterprise Advisory Committee and Not-for-Profit Advisory Committee, as well as the results from the Future Domestic Work Plan Consultation Survey. The purpose of this feedback was to identify new activities to add to its work plan related to Accounting Standards for Private Enterprises, Accounting Standards for Not-for-Profit Organizations, and Accounting Standards for Pension Plans.
The AcSB will continue to evaluate its activities in the coming months and make decisions on the activities to undertake in 2024-2025. The Board plans to approve the 2024-2025 Annual Plan in March 2024.
Amendments to Other Frameworks
As part of its ongoing activities to maintain high-quality domestic accounting standards, the AcSB considers whether amendments made to accounting frameworks in other jurisdictions, if incorporated into Canadian standards, would significantly improve Parts II and III of the CPA Canada Handbook – Accounting. The Board discussed recommendations from its Private Enterprise Advisory Committee and its Not-for-Profit Advisory Committee on recent amendments made to the following frameworks:
- U.S. generally accepted accounting principles (GAAP) issued by the Financial Accounting Standards Board;
- IFRS Accounting Standards issued by the IASB;
- New Zealand GAAP issued by the External Reporting Board;
- Australian accounting standards issued by the Australian Accounting Standards Board; and
- U.K. GAAP issued by the United Kingdom’s Financial Reporting Council.
For the list of potential topics considered for the AcSB’s future work plan, the Board agreed with the recommendations to include the disclosure of non-current liabilities with covenants to comply with after period-end and to include the disclosure of supplier finance program obligations. The Board will assess the priority of projects and decide on activities to add to its work plan as part of its ongoing discussion on its 2024-2025 Annual Plan.
Handbook Process
The AcSB discussed the current presentation of the Handbook in Knotia and considered whether presenting annual editions for Parts II, III, and IV of the Handbook would benefit readers. The Board heard that publishing amendments that are issued but not yet effective directly in the Handbook creates challenges for readers applying the standards, as it may be unclear which requirements are in force and which will be effective at a later date. The Board agreed that an annual presentation would be easier for readers to navigate.
The AcSB will work with those involved in the production of the Handbook and make recommendations for improvement.