Filling the gaps in GAAP: AcSB issues draft framework for reporting performance measures

On June 14, 2018, the Accounting Standards Board issued the Draft Framework for Reporting Performance Measures.

Financial statements provide a strong foundation for financial reporting. But there’s more information that users consider – including performance measures – when making investing, contributing, lending and other resource allocation decisions. Performance measures range from measures under GAAP to non-financial or operational measures.

The Accounting Standards Board (AcSB)’s Draft Framework for Reporting Performance Measures proposes guidance on reporting performance measures outside of GAAP.

The voluntary framework is the first step in responding to the needs of stakeholders – including investors, contributors, lenders and other resource providers – about the performance measures reported by entities.

It will address such concerns as:

  • the quality of performance measures being reported
  • the lack of consistency, transparency and comparability of performance measures reported
  • the “expectation gap” between the governance practices of entities with regards to how performance measures are developed and reported, and whether those measures are subject to assurance

Using the framework can enhance the relevance of financial information for all entities – from public and private companies to not-for-profit organizations and pensions plans.

As a follow up to this framework, and in response to market and user concerns, the AcSB intends to work with Chartered Professional Accountants of Canada (CPA Canada) to develop additional guidance that is industry- or sector-specific. We need you to join the discussion and help improve financial and non-financial performance measures reported outside of financial statements.

The AcSB requests your feedback on the framework by September 17, 2018. Get more information on this project.