Standards For Not-For-Profit

The new accounting standards for not-for-profit organizations (NFPOs) in the private sector will look quite familiar to stakeholders. The Accounting Standards Board (AcSB) has approved a new framework that is based on existing Canadian GAAP and incorporates the 4400 series of standards which relate to situations unique to the not-for-profit world.

The new standards will be available as of December 1, 2010 as Part III of the CICA Handbook - Accounting and are effective January 1, 2012. Early adoption is permitted. Also, these organizations have the option of adopting International Financial Reporting Standards - an alternative that may be attractive to some organizations depending on their individual circumstances.

The new reporting options were created to recognize the diverse nature of the organizations and will provide useful financial statements for members, boards, contributors, lenders, clients and other users of their financial statements.

Effective January 1, 2012, those government organizations that use accounting standards for NFPOs are being directed to the CICA Public Sector Accounting Handbook (PSA Handbook) rather than the CICA Handbook - Accounting. The move is intended to enhance the public accountability and comparability of their financial reporting with those of other government organizations. The Public Sector Accounting Board (PSAB) has attempted to minimize the impact of the changes by introducing the 4400 series into the PSA Handbook substantially as it now stands. Use of the series, which will be included in the PSA Handbook as of December 1, 2010, is optional. As well, PSAB is currently addressing the issue of a financial instruments standard.

Part V of the CICA Handbook - Accounting, which is a complete set of the existing Handbook contents, remains available to private and government NFPOs until January 1, 2012.