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IFRS® Accounting Standards

AcSB Exposure Draft – Regulatory Assets and Regulatory Liabilities


The Accounting Standards Board (AcSB) proposes, subject to comments received following exposure, to incorporate into Part I of the CPA Canada Handbook – Accounting, new standard Regulatory Assets and Regulatory Liabilities.

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Katharine Christopoulos, CPA, CA Director, Accounting Standards Board

Thank you for your interest in the AcSB Exposure Draft – Regulatory Assets and Regulatory Liabilities.

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The Accounting Standards Board (AcSB) has issued its Exposure Draft that corresponds to the International Accounting Standards Board’s (IASB) Exposure Draft on Regulatory Assets and Regulatory Liabilities.

The IASB is proposing a new IFRS Standard that would require certain entities subject to rate regulation to reflect the total allowed compensation to which they are entitled for the goods or services supplied in a period as part of their reported financial performance for that period. An entity would recognize regulatory assets and regulatory liabilities in its statement of financial position, and related regulatory income and regulatory expense in its statement(s) of financial performance. The proposed accounting model enables financial statement users to understand how regulatory assets and regulatory liabilities will affect the amount, timing and uncertainty of the entity’s future cash flows, and obtain a more complete picture of the entity’s financial performance.

The AcSB’s due process includes ensuring that Canadian entities’ financial reporting needs are considered by the IASB and issuing the AcSB’s own exposure draft on each IASB proposal. Subject to the responses to the AcSB’s Exposure Draft on whether the IASB’s proposals are appropriate for application in Canada, the AcSB expects that the amendments will be incorporated into Canadian GAAP in accordance with the AcSB’s strategy of adopting IFRS® Standards for publicly accountable enterprises.