Standards digest — March 2016

The AcSB’s new Discussion Paper on Agriculture is now out for comment. Plus, newly retired PSAB director Tim Beauchamp reflects on progress made in public sector financial reporting since he started with the team in 1989.

HOT TOPIC

Agriculture

The Accounting Standards Board (AcSB) Discussion Paper on Agriculture is now out for comment. A discussion paper comes before an exposure draft and will help the AcSB decide whether to continue the agriculture project to develop authoritative guidance, either by developing a new standard or amending existing standards. If they decide to move on it, they will consider the input received and develop an exposure draft of proposed changes to accounting standards for private enterprises.

The discussion paper considers when to record and how to measure a living animal or plant, as well as the harvested product from these assets. The AcSB’s preliminary view is to measure:
• unharvested crops, bearer animals and bearer plants at cost; and
• animals held for sale and the harvested product from living animals and plants at current value when certain conditions are met.

Help shape the future accounting for biological assets and agricultural produce in Accounting Standards for Private Enterprises. Provide written comments on this paper to the AcSB by May 19, 2016, and stay tuned for details on the AcSB’s upcoming agriculture roundtable discussions in May and June.

Get all the info you need on this project via www.frascanada.ca/agriculture.

Q&A

PSAB and its future

Q: How far has PSAB come since you started, Tim?
A: There used to be a lot of inconsistency in public sector financial reporting. For example, not all liabilities were recorded and not all assets were recorded. Reporting was fragmented as there were no basic consolidation principles in place. What’s happened over the last 27 years is that we’ve been able to bring the public sector together and move toward completeness and comparability of financial statements.

In terms of completeness, governments are now recording liabilities such as pension plans and their tangible capital assets, which weren’t visible on their financial statements before. Governments are also now preparing consolidated financial statements, which are a better representation of everything that they are responsible for.

When it comes to comparability, we now have a good degree of that among governments — not only the federal, provincial and territorial levels, but also municipalities and a good number of government organizations.

Overall, PSAB was able to reach agreement on a common reporting framework that is leading to better information for decision-making and demonstrating accountability by the public sector. This also improves understandability. To say the least, there has been a lot accomplished and I think that’s a reflection of the public sector itself understanding the need for improvements in financial reporting and its willingness to make that happen. Let’s just say — it’s been quite a journey.

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