Directive on Accounting Standards
Provides the accounting, reporting, and recording framework for the Government of Canada’s consolidated financial statements, departmental financial statements, and quarterly financial reports.
Date modified: 2023-11-28
Supporting tools
Guide:
Standard:
- GC 1010 Financial Statement Concepts (Materiality)
- GC 1100 Financial Statement Objectives
- GC 1150 Generally Accepted Accounting Principles
- GC 1201 Financial Statement Presentation
- GC 1300 Government Reporting Entity
- GC 2200 Related party disclosures
- GC 2400 Subsequent Events
- GC 2601 Foreign Currency Translation
- GC 2700 Segment Disclosures
- GC 3050 Loans Receivable
- GC 3150 Tangible Capital Assets
- GC 3250-3255 Retirement and Post-Employment Benefits
- GC 3260 Liability for Contaminated Sites
- GC 3280 Asset Retirement Obligations
- GC 3300-3310 Contingent Liabilities and Loan Guarantees
- GC 3320 Contingent Assets
- GC 3390 Contractual Obligations
- GC 3410 Government Transfers
- GC 3430 Restructuring transactions
- GC 3450 Financial Instruments
- GC 4100 Specified Purpose Accounts
- GC 4200 Inventories
- GC 4300 Non-Monetary Transactions
- GC 4400 Departmental Quarterly Financial Report
- GC 4500 Departmental Financial Statements
- GC 5000 Recording Financial Transactions in the Accounts of Canada
- GC 5100 Payables at Year-End
- GC 5200 Crown Corporations Quarterly Financial Report
- GC 3400 Revenue
- GCG-8 Purchased Intangibles
- Government of Canada Accounting Handbook, Introduction
More information
Policy:
Terminology:
Topic:
Hierarchy
Archives
This directive replaces:
- Accounting for Inventories, Policy on [2017-04-01]
- Assets and Liabilities, Policy on Allowances for Valuation of [2017-04-01]
- Accounting for Non-Monetary Transactions, Policy on [2017-04-01]
- Accounting Standard 2.2 - Treasury Board - Materiality [2017-04-01]
- Accounting Standard 3.1 - Treasury Board - Capital Assets [2017-04-01]
- Accounting Standard 3.1.1 - Treasury Board - Software [2017-04-01]
- Accounting Standard 3.2 - Treasury Board - Transfer Payments (Grants and Contributions) [2017-04-01]
- Accounting Standard 3.4 - Treasury Board - Inventories [2017-04-01]
- Accounting Standard 3.6 - Treasury Board - Contingencies [2017-04-01]
- Contingencies, Directive on [2017-04-01]
- Recording Financial Transactions in the Accounts of Canada, Directive on [2017-04-01]
- Accounting Standard 1.3 – Treasury Board - Departmental and Agency Quarterly Financial Report [2017-04-01]
- Accounting Standard 1.2 – Treasury Board - Departmental and Agency Financial Statements [2017-04-01]
- Year-End Recording of Payables, Directive on [2017-04-01]
1. Effective date
- 1.1This directive takes effect on .
- 1.2This directive and the Government of Canada Accounting Handbook (GCAH) replace the following Treasury Board policy instruments:
- Treasury Board Accounting Standard 1.2: Departmental and Agency Financial Statements ()
- Treasury Board Accounting Standard 1.3: Departmental and Agency Quarterly Financial Report ()
- Treasury Board Accounting Standard 2.2: Materiality ()
- Treasury Board Accounting Standard 3.1: Capital Assets ()
- Treasury Board Accounting Standard 3.1.1: Software ()
- Treasury Board Accounting Standard 3.2: Transfer Payments (Grants and Contributions) ()
- Treasury Board Accounting Standard 3.4: Inventories ()
- Treasury Board Accounting Standard 3.6: Contingencies ()
- Policy on Accounting for Inventories ()
- Policy on Allowances for Valuation of Assets and Liabilities ()
- Directive on Contingencies ()
- Directive on Recording Financial Transactions in the Accounts of Canada ()
- Directive on Year-End Recording of Payables ()
- Policy on Accounting for Non-Monetary Transactions ()
2. Authorities
- 2.1This directive is issued pursuant to the authorities indicated in section 7 and subsections 9(1) and 37.1 of the Financial Administration Act.
3. Objectives and expected results
- 3.1The objectives indicated in section 3 of the Policy on Financial Management apply to this directive.
- 3.2The expected results indicated in section 3 of the Policy on Financial Management apply to this directive.
4. Requirements
- 4.1The chief financial officer is responsible for the following:
- 4.1.1Ensuring that departmental accounting policies are in accordance with the following:
- 4.1.1.1Public Sector Accounting Standards and Public Sector Guidelines (PSAS) issued by the Public Sector Accounting Board of the Chartered Professional Accountants of Canada; and
- 4.1.1.2The Government of Canada Accounting Handbook (GCAH), which is referred to for supplementary information on:
- 4.1.1.2.1The government’s accounting choices, where options exist, under PSAS;
- 4.1.1.2.2The government’s accounting policies in the absence of specific PSAS; and
- 4.1.1.2.3Specific policies relevant to departmental financial statements or quarterly financial reports.
- 4.1.2Ensuring that departmental financial statements are prepared on an accrual basis, in accordance with the relevant GCAH sections;
- 4.1.3Ensuring that departmental quarterly financial reports are prepared for the first three quarters of the fiscal year in accordance with the special purpose financial reporting framework as stated in the relevant GCAH sections;
- 4.1.4Consulting with the Office of the Comptroller General of Canada prior to engaging an external auditor to audit the departmental financial statements, except when required by legislation;
- 4.1.5Developing and maintaining a departmental chart of accounts that:
- 4.1.5.1Is in accordance with the Government-wide Chart of Accounts for Canada and is integrated with the departmental financial system; and
- 4.1.5.2Allows for financial reporting in accordance with the Policy on Results; and
- 4.1.6Consulting first with the Office of the Comptroller General of Canada on interpretations of this directive that have a material effect on the financial statements.
- 4.1.1Ensuring that departmental accounting policies are in accordance with the following:
- 4.2The Receiver General for Canada is responsible for the following:
- 4.2.1Maintaining the Government-wide Chart of Accounts for Canada and communicating to the financial community any changes made;
- 4.2.2Providing implementation assistance, operational instructions and other guidance to departments regarding the Government-wide Chart of Accounts for Canada and government-wide coding; and
- 4.2.3Performing quality assurance regarding the coding of transactions and the government-wide classification structure.
5. Roles of other government organizations
- 5.1Not applicable
6. Application
- 6.1This directive applies to the organizations listed in section 6 of the Policy on Financial Management.
7. References
- 7.1Legislation
- Financial Administration Act (sections 63 and 64 and subsection 65.1)
- 7.2Related instruments
- CPA Canada Public Sector Accounting Handbook A CPA Canada membership or annual subscription is necessary to access this content.
- Policy on Results (subsection 5.3.1)
8. Enquiries
- 8.1Members of the public may contact Treasury Board of Canada Secretariat Public Enquiries regarding any questions about this directive.
- 8.2Individuals from departments should contact their departmental corporate reporting group regarding any questions about this directive.
- 8.3Individuals from a departmental corporate reporting group may contact Financial Management Enquiries for interpretation of this directive.
Appendix A: Standard on the Government of Canada Accounting Handbook
A.1 Effective date
- A.1.1This standard takes effect on
- A.1.2Public Sector Accounting Standards are continually evolving. As a result, standards are added, amended or deleted effective the dates noted in Section A.3 below.
A.2 Standard
- A.2.1This standard provides details on the requirements set out in section 4 of the Directive on Accounting Standards.
- A.2.2Sections are as follows:
- A.2.2.1Introduction and Summary of Applicability of PSAS
- A.2.2.2GC 1010 Financial Statement Concepts (Materiality)
- A.2.2.3GC 1100 Financial Statement Objectives
- A.2.2.4GC 1150 Generally Accepted Accounting Principles
- A.2.2.5GC 1201 Financial Statement Presentation
- A.2.2.6GC 1300 Government Reporting Entity
- A.2.2.7GC 2200 Related Party Disclosures
- A.2.2.8GC 2400 Subsequent Events
- A.2.2.9GC 2601 Foreign Currency Translation
- A.2.2.10GC 2700 Segment Disclosures
- A.2.2.11GC 3050 Loans Receivable
- A.2.2.12GC 3150 Tangible Capital Assets
- A.2.2.13GC 3250-3255 Retirement/Post-Employment Benefits
- A.2.2.14GC 3260 Liability for Contaminated Sites
- A.2.2.15GC 3280 Asset Retirement Obligations
- A.2.2.16GC 3300-3310 Contingent Liabilities and Loan Guarantees
- A.2.2.17GC 3320 Contingent Assets
- A.2.2.18GC 3390 Contractual Obligations
- A.2.2.19GC 3400 Revenue
- A.2.2.20GC 3410 Government Transfers
- A.2.2.21GC 3420 Inter-entity Transactions
- A.2.2.22GC 3430 Restructuring Transactions
- A.2.2.23GC 3450 Financial Instruments
- A.2.2.24GC 4100 Specified Purpose Accounts
- A.2.2.25GC 4200 Inventories
- A.2.2.26GC 4300 Non-Monetary Transactions
- A.2.2.27GC 4400 Departmental Quarterly Financial Report
- A.2.2.28GC 4500 Departmental Financial Statements
- A.2.2.29GC 5000 Recording Financial Transactions in the Accounts of Canada
- A.2.2.30GC 5100 Payables at Year-End
- A.2.2.31GC 5200 Crown Corporations Quarterly Financial Report
- A.2.2.32GCG-8 Purchased Intangibles
A.3 Revisions since
Section | Effective Date | Nature of Revision |
---|---|---|
GC 2200 Related Party Disclosures | New | |
GC 3420 Inter-entity transactions | New | |
GC 3430 Restructuring Transactions | New | |
GC 5200 Crown Corporations Quarterly Financial Report | New – Only applicable to parent Crown corporations as defined in Section 83 of the Financial Administration Act | |
Government of Canada Accounting Handbook – Introduction | Minor Revisions | |
GC 3050 Loans Receivable | Minor Revisions | |
GC 3150 Tangible Capital Assets | Minor Revisions | |
GC 3300/3310 Contingent Liabilities and Loan Guarantees | Minor Revisions | |
GC 4500 Departmental Financial Statements | Minor Revisions | |
All sections | Minor Revisions | |
Government of Canada Accounting Handbook – Introduction | Consequential amendments arising from new or revised sections | |
GC 2601 Foreign Currency Translation | New | |
GC 3050 Loans Receivable | Revision of significant concessionary terms threshold. | |
GC 3150 Tangible Capital Assets | Revisions to software section. | |
GC 3260 Liability for Contaminated Sites | New | |
GC 3280 Asset Retirement Obligations | New | |
GC 3420 Inter-entity Transactions | Consequential amendment arising from implementation of GC 3280 | |
GC 3450 Financial Instruments | New | |
GC 4500 Departmental Financial Statements | Formalize requirement for Deputy Head and Chief Financial Officer signature on Statement of Management Responsibility | |
GC 3400 Revenue | New | |
CGC-8 Purchased Intangibles | New |
Appendix B: Definitions
- accrual accounting (comptabilité d’exercice)
- A basis of accounting that recognizes the effect of transactions and events on a department’s financial statements in the period(s) in which they occur, rather than in the period(s) in which the department uses its appropriation. This recognition occurs regardless of whether there has been a receipt or payment of cash or its equivalent. (Public Sector Accounting Standards, PS 1000.59)
- appropriation (crédit)
- Any authority of Parliament to pay money out of the Consolidated Revenue Fund. (Financial Administration Act section 2)
- central financial management reporting system (CFMRS) (système central de gestion des rapports financiers (SCGRF))
- The Public Services and Procurement Canada electronic system that stores summary departmental financial data according to the Government-wide Coding Structure.
- chart of accounts (plan comptable)
- A list of codes used to classify, record and report financial transactions. A departmental chart of accounts uses codes that aggregate to the codes found in the Government-wide Chart of Accounts.
- expenditure (dépenses)
- An amount charged against a departmental appropriation in the accounting period.
- expenditure basis of accounting (appropriation accounting/modified cash/partial accrual accounting) (méthode de comptabilité axée sur les dépenses (comptabilité des crédits, comptabilité de caisse modifiée, comptabilité d’exercice partielle))
- A basis of accounting that aligns with how Parliament authorizes departmental charging against an appropriation. Appropriation accounting differs in its presentation from accrual accounting in that transactions that do not require the use of an appropriation are not reported.
- expense (charge)
- Decreases in economic resources, either by way of decreases in assets or increases in liabilities, resulting from the operations, transactions and events of the accounting period (Public Sector Accounting Standards, PS 1000.49)
- guarantees (garanties)
- A promise to pay all or a part of the principal and/or interest on a debt obligation in the event of default by the borrower. A loan guarantee is a contingent liability of the government. (Public Sector Accounting Standards, PS 3310.03, PS 3310.04)
- payable at year-end (créditeur en fin d’exercice)
-
- A debt incurred from work performed, goods received or services rendered before year-end; or
- A debt owing on, or before, year-end under a contract or similar arrangement; or
- An amount payable on, or before, year-end, resulting from transactions and events with other departments and Crown corporations. It also includes amounts payable as if they were debts under certain administrative arrangements, including memoranda of understanding with provincial, national or international entities and organizations. It also includes an amount payable under legislation in force at year-end.
- respendable revenues (revenus disponibles)
- A type of revenue that, once received, increases the departmental spending authority. A department requires specific authority from Parliament to respend revenues. Respending authority is derived from the Financial Administration Act (FAA), subsection 29.1(1); the FAA and an Appropriation Act, subsection 29.1(2); legislation specific to a department (e.g., enabling and/or program); or other specific legislation.
- special purpose financial reporting framework (référentiel à usage particulier)
- Accounting standards and guidance designed to meet the financial information needs of specific users as opposed to the common financial information needs of a wide range of users. (Introduction to public sector accounting standards .13)
© His Majesty the King in Right of Canada, represented by the President of the Treasury Board, 2017,
ISBN: 978-0-660-09526-4