Basis for Conclusions – Government Not-for-Profit Strategy

Consultation Paper I

In May 2019, PSAB issued the “Government Not-for-Profit Consultation Paper.” This Consultation Paper focused on gaining a better understanding of the public sector not-for-profit landscape and determining what the government not-for-profit organizations’ (GNFPOs) unique financial reporting needs might be.

Consultation Paper II

In January 2021, PSAB issued the “Government Not-for-Profit (GNFP) Strategy Consultation Paper II,” asking stakeholders to consider three options and criteria. Consultation Paper II also sought stakeholders’ views on whether the Board’s recommended GNFP Strategy of public sector accounting standards (PSAS) incorporating the PS 4200 series with potential customizations best meets the Canadian public interest.

Consultation Paper II was issued at the same time as PSAB’s Exposure Drafts, “The Conceptual Framework for Financial Reporting in the Public Sector” and “Financial Statement Presentation, Proposed Section PS 1202.” In developing the proposals in the Exposure Drafts, the Concepts Underlying Financial Performance project considered all public sector entities that apply the CPA Canada Public Sector Accounting (PSA) Handbook, including GNFPOs. Consultation Paper II acknowledged that some of the Exposure Draft proposals may help alleviate some of the concerns heard from GNFPO stakeholders. Therefore, these documents for comment were issued at the same time so stakeholders could understand the full nature and extent of the proposals and their implications.

Summary of responses

What we asked − Do you agree the proposed option, Option 2 – PSAS incorporating the PS 4200 series with potential customizations, best meets the Canadian public interest?

What you said − Option 2 will help improve comparability of the GNFPO financial statements. However, there was some uncertainty about how the PS 4200 series would be incorporated into PSAS and what customizations might be proposed.

What we decided to do – Proceed with Option 2 as PSAB’s GNFP Strategy after careful consideration of feedback to the Consultation Papers. An implementation plan will be developed, setting out how to go about incorporating the PS 4200 series into PSAS.

All proposed changes to the PS 4200 series, PSAS, and potential customizations will be subject to due process, meaning stakeholders will be consulted before PSAB finalizes any changes to the PSA Handbook.

Download PSAB’s GNFP Strategy Basis for Conclusions for more information on stakeholder feedback and PSAB’s decision to proceed with Option 2.

Next Steps

An implementation plan is being developed and is expected to be approved by PSAB at its June 2022 meeting. Once approved, the first standards-level project will begin, following due process.
We will host a webinar, in fall 2022, to present the feedback to the GNFP Strategy Consultation Paper II and the rationale for the GNFP Strategy decision. We will also provide an overview of the implementation plan.

Updates will be posted on the GNFP Strategy project page.