Alert: Government Not-for-Profit Consultation Paper

Alert: Government Not-for-Profit Consultation Paper

In May 2019 the Public Sector Accounting Board (PSAB) issued a Consultation Paper (CP) to gather feedback for the development of a Government Not-for-Profit (GNFP) strategy that will meet the public interest.

Background

As part of its 2017-2021 Strategic Plan, PSAB highlighted its intention to assess the specific needs of GNFP stakeholders and determine if some public sector accounting standards should apply differently to this group. Accordingly, PSAB and its staff consulted with more than 100 GNFP stakeholders in 2017 to better understand their financial reporting needs and concerns and the current Canadian GNFP landscape. The following needs and concerns were identified:

  • Diversity in the financial reporting practices of Government Not-for-Profit Organizations (GNFPOs) in Canada;
  • Relevance of the net debt indicator;
  • The need for fund accounting;
  • The need for specific guidance relating to endowments; and,
  • The effect of Public Sector Accounting Standards (PSAS) on the balanced-budget mandate.

Purpose

The purpose of the current CP is to:

  • Inform GNFP stakeholders of the Canadian and international not-for-profit financial reporting landscape;
  • Communicate the results of the 2017-2018 GNFP consultations; and,
  • Request stakeholder input on key issues that will guide PSAB in determining its next steps for the GNFP strategy.

Feedback Requested

As part of this CP, PSAB has requested feedback on the following areas:

  • Future trends specific to the GNFP sector and their impact on financial reporting;
  • Other significant financial reporting concerns not captured as part of the 2017-2018 GNFP consultations;
  • Whether governments and GNFPOs should account for transactions similarly and present information similarly in the financial statements;
  • Whether financial statement users would benefit from all GNFPOs using the same set of financial reporting standards;
  • Whether financial statement users would benefit from comparable financial information within each subsector (e.g. universities, colleges, museums, social housing, etc.); and,
  • The key areas where financial information comparability within each subsector would be beneficial or not for financial statement users.

Comments for this CP were due by September 30, 2019. PSAB will determine the next steps relating to its GNFP strategy once the responses are assessed.

Full details on the project can be found here.


This communication contains a general overview of the topic and is current as of October 7, 2019. The application of the principles addressed will depend upon the particular facts and circumstances of each individual case. Accordingly, this publication is not a substitute for professional advice and we recommend that any decisions you take about the application or not of any of the information presented be made in consultation with a qualified professional who can address any variance that may be required to reflect your circumstances. Please contact your local MNP representative for customized assistance with the application of this material. MNP LLP accepts no responsibility or liability for any loss related to any person's use of or reliance upon this material. © MNP LLP 2019. All rights reserved.

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Michelle Balmer

Michelle Balmer CPA, CA

Vice President, Assurance

Michelle Balmer, CPA, CA, is a Senior Assurance Services Partner with MNP. With 14 years of experience in public practice, Michelle helps a broad range of public and privately held companies in a variety of industries. She also works on special projects, including costing studies, benchmarking and best-practice studies, operational analyses, litigation support and due diligence.

As a key member of MNP's Assurance team, Michelle has played an instrumental role in assurance policy development, implementing accounting and assurance standards firm-wide and educating assurance practitioners regarding methodologies and new pronouncements. She also provides technical advice and consultation on accounting and assurance issues, as well as on rules of professional conduct issues, to all MNP practitioners.

Michelle was certified a Chartered Accountant (CA) after obtaining a Bachelor of Commerce degree from the University of Alberta. She has been actively involved with the Institute of Chartered Accountants of Alberta, including the Chartered Accountants School of Business, in an instructional and marketing capacity. An avid volunteer, she has assisted numerous groups such as the Easter Seals of Alberta, Paralympic Sports Association and Junior Achievement of Northern Alberta.