Summary Comparison of Part II of the CICA Handbook – Accounting
to XFI Version in Part V
As of December 31, 2009
1. This comparison has been prepared by the staff of the Accounting Standards Board (AcSB) and has not been approved by the
AcSB.
2. This document provides a high-level comparison of accounting standards for private enterprises (Part II) and the XFI version of
Part V of the CICA Handbook – Accounting (Handbook). It covers significant recognition and measurement differences only and
does not necessarily include all of the differences that might arise in a particular entity’s circumstances. Presentation and
disclosure requirements are not within the scope of this comparison. Presentation requirements for Part II are provided in Section
1520, Income Statement, Section 1521, Balance Sheet, and Section 1540, Cash Flow Statement. A compilation of disclosure
requirements is also provided in Part II of the Handbook.
3. This document should not be used in preparing financial statements. To understand fully the implications of preparing financial
statements in accordance with Part II of the Handbook, users of this comparison must refer to the standards themselves.
4. The standards in Part II and the XFI Version of Part V of the Handbook are based on common conceptual frameworks. Part V of
the Handbook was used as a starting point in developing the standards in Part II. Standards in Part V that are largely irrelevant to
the private enterprise sector have been excluded from Part II and a limited number of issues that have caused significant concern
for private enterprises have been reconsidered. However, the majority of the recognition and measurement requirements in Part V
of the Handbook do not cause significant concern for private enterprises and have been retained in Part II “as is”. Emerging Issues
Committee (EIC) Abstracts of Issues Discussed have been excluded from Part II but in a limited number of instances, guidance on
significant issues addressed in EIC Abstracts has been incorporated into Part II.
5. This comparison is organized according to Handbook Sections and Accounting Guidelines and reflects standards issued as of
December 31, 2009. The term “converged” has been used in the comparison when the standards in Part II are substantially the
same as the relevant standards in the XFI version of Part V. Similar requirements compiled in a single standard in Part II that
were previously reflected in two or more standards in Part V, are not considered “differences” for the purpose of this comparison.
Accounting Standards Board
277 Wellington Street West, Toronto, Ontario, Canada M5V 3H2
Tel: (416) 977-3222 Fax: (416) 204-3412
Page 1 of 18
(As of December 31, 2009)
The following table of concordance relates each accounting standard for private enterprises in Part II of the CICA Handbook – Accounting, to
the corresponding standard in XFI version of Part V. The table does not include differences in disclosure requirements.
Handbook
standards,
Part V (XFI)
Handbook
standards,
Part II
Comparison of accounting treatments
Significance 1
of
differences
Section 1000, Financial
Statement Concepts
Section 1000, Financial
Statement Concepts
Section 1000, Part II, is converged with XFI Section.
None.
Section 1100, Generally
Accepted Accounting
Principles
Section 1100, Generally
Accepted Accounting
Principles
Section 1100, Part II, is converged with XFI Section.
Section 1100, Part II, has been redrafted to be consistent
with the content of Part II.
Not significant.
Section 1300, Differential —
Reporting
No corresponding standard in Part II.
—
Section 1400, General
Standards of Financial
Statement Presentation
Section 1400, General
Standards of Financial
Statement Presentation
Section 1400, Part II, is converged with XFI Section.
None.
—
Section 1500, First-time
Adoption
No corresponding standard in XFI standards.
Significant on first-time
adoption of accounting
standards for private
enterprises in Part II.
1
The assessment of significance of differences is a judgment made by AcSB staff in general terms. A difference may be significant to a particular transaction or
entity depending on its materiality or nature.
Page 2 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Section 1505, Disclosure
of Accounting Policies
Handbook standards,
Part II
Significance
of
differences
Section 1505, Disclosure
of Accounting Policies
All requirements in this Section relate to disclosures,
which are outside the scope of this summary
comparison.
—
Section 1506, Accounting
Changes
Section 1506, Accounting
Changes
Section 1506, Part II, is converged with XFI Section,
except that Section 1506, Part II, permits certain
accounting policy choices to be changed without
meeting the criterion in 1506.06 of providing more
relevant or reliable information (see 1506.09).
Significant.
Section 1508,
Measurement
Uncertainty
Section 1508,
Measurement Uncertainty
All requirements in this Section relate to disclosures,
which are outside the scope of this summary
comparison.
—
Section 1510, Current
Assets and Current
Liabilities
Section 1510, Current
Assets and Current
Liabilities
Section 1510, Part II, is converged with XFI Section.
None.
Comparison of accounting treatments
The following Sections in Part V have been
incorporated into Section 1510, Part II:
• Section 3000 (see 1510.07); and
• Section 3040 (see 1510.06).
Certain guidance from the following EIC Abstracts has
been included in Section 1510, Part II:
• EIC-59 (see 1510.14); and
• EIC-122 (see 1510.13).
Section 1520, Income
Section 1520, Income
Statement
This presentation Section reflects income statement
presentation requirements from other Sections –
—
Page 3 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Statement
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
presentation is outside the scope of this summary
comparison.
—
Section 1521, Balance
Sheet
This presentation Section reflects balance sheet
presentation requirements from other Sections –
presentation is outside the scope of this summary
comparison.
—
Section 1535, Capital
Disclosures
—
No corresponding standard in Part II.
—
Section 1540, Cash Flow
Statement
Section 1540, Cash Flow
Statement
Section 1540, Part II, is converged with XFI Section.
However, under Part II, all enterprises must provide a
cash flow statement.
Significant for
enterprises that do not
provide a cash flow
statement under XFI
standards.
Section 1582, Business
Combinations
Section 1582, Business
Combinations
Section 1582, Part II, is converged with XFI Section.
Significant for
Section 1582 is effective on adoption of Part II as Part II enterprises adopting Part
does not include Section 1581.
II prior to 2011.
Section 1590,
Subsidiaries
Section 1590, Subsidiaries Section 1590, Part II, is converged with XFI Section,
except as noted below.
Under Section 1590, Part II, an enterprise may account
for subsidiaries by consolidating them, or using either
the cost or equity method. This is consistent with the
differential reporting option in XFI Section. However an
investment in a subsidiary whose equity securities are
Significant for a
subsidiary that would
now be accounted for at
fair value rather than
cost.
Page 4 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
quoted in an active market is not accounted for at cost,
but may be accounted for at fair value.
Section 1601,
Consolidated Financial
Statements
Section 1601,
Consolidated Financial
Statements
Section 1601, Part II, is converged with XFI Section.
None.
Section 1602, Noncontrolling Interests
Section 1602, Noncontrolling Interests
Section 1602, Part II, is converged with XFI Section.
Section1602 is effective on adoption of Part II as Part II
does not include Section 1600.
Significant for
enterprises adopting Part
II prior to 2011.
Section 1625,
Comprehensive
Revaluation of Assets and
Liabilities
Section 1625,
Comprehensive
Revaluation of Assets and
Liabilities
Section 1625, Part II, is converged with XFI Section
except for the accounting for income tax benefits (see
1625.43-44).
Not significant.
Section 1650, Foreign
Currency Translation
Section 1651, Foreign
Currency Translation
Section 1651, Part II, is converged with XFI Section
1650.
None, except for hedge
accounting addressed in
Section 3856, Part II.
Section 1701, Segment
Disclosures
—
Hedge accounting (other than a hedge of an investment
in a self-sustaining foreign operation) is addressed in
Section 3856, Part II, rather than in Section 1651,
Part II, and differs from XFI Section 1650.
No corresponding standard in Part II.
—
Section 1751, Interim
Financial Statements
—
No corresponding standard in Part II.
—
Page 5 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Section 1800,
Unincorporated
Businesses
Handbook standards,
Part II
Section 1800,
Unincorporated
Businesses
Section 1800, Part II, is converged with XFI Section.
Section 3000, Cash
—
No corresponding standard in Part II. Guidance from
XFI Section incorporated in Section 1510, Part II (see
1510.07).
—
Section 3010, Temporary
Investments
—
No corresponding standard in Part II. Measurement
and impairment requirements are provided in Section
3856, Part II. Designation as “temporary” is no longer
relevant. Financial instruments are classified as current
if they meet the requirements in Section 1510, Part II.
Significant.
Section 3020, Accounts
and Notes Receivable
—
No corresponding standard in Part II. Guidance from
XFI Section incorporated in Section 3856, Part II (see
3856.16-.19).
—
Section 3025, Impaired
Loans
—
No corresponding standard in Part II. Guidance
provided in Section 3856, Part II, differs from that in
Section 3025 (see 3856.16-.19) in that alternative
measurements are possible. When measurement of
impairment is based on recoverable amounts, these
estimates are discounted using market interest rates
rather than the original effective interest rate.
Often not significant.
Section 3031, Inventories
Section 3031, Inventories
Section 3031, Part II, is converged with XFI Section.
None.
Comparison of accounting treatments
Significance
of
differences
None.
Page 6 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Section 3040, Prepaid
Expenses
Section 3050, Long-term
Investments
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
—
No corresponding standard in Part II. Guidance from
XFI Section incorporated in Section 1510, Part II (see
1510.06).
—
Section 3051, Investments
Section 3051, Part II differs from XFI Section 3050.
Significant differences are noted below.
Significant.
Under Section 3051, Part II, an enterprise may account
for significantly influenced investees using either the
cost or equity method. This is consistent with the
differential reporting option in XFI Section 3050.
However, an investment in a significantly influenced
investee whose equity securities are quoted in an active
market is not accounted for at cost but may be
accounted for at fair value.
Under Section 3856, Part II, an investment in an equity
security that is traded in an active market and not
subject to significant influence is accounted for at fair
value rather than at cost.
Section 3055, Interests in
Joint Ventures
Section 3055, Interests in
Joint Ventures
The impairment provisions in Section 3051, Part II, are
consistent with those in Section 3856, Part II.
Section 3055, Part II, differs from XFI Section.
Significant differences are noted below.
Significant.
Under Section 3055, Part II, an enterprise may account
for interests in joint ventures using proportionate
consolidation, the cost method or the equity method.
Page 7 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Handbook standards,
Part II
Comparison of accounting treatments
Significance
of
differences
This is consistent with the differential reporting options
in XFI Section. However an investment in a joint
venture whose equity securities are quoted in an active
market is not accounted for at cost but may be
accounted for at fair value.
The impairment provisions in Section 3055, Part II, are
consistent with those in Section 3856, Part II.
Section 3061, Property
Plant and Equipment
Section 3061, Property
Plant and Equipment
Section 3061, Part II, is converged with XFI Section.
None.
Section 3063, Impairment Section 3063, Impairment
of Long-lived Assets
of Long-lived Assets
Section 3063, Part II, is converged with XFI Section.
None.
Section 3064, Goodwill
and Intangible Assets
Section 3064, Part II differs from XFI Section.
Significant differences are noted below.
Significant.
Section 3064, Goodwill
and Intangible Assets
Internally developed intangible assets
Section 3064, Part II, permits an enterprise to make an
accounting policy choice to capitalize or expense
development costs.
Goodwill and other intangible assets – impairment
testing
Section 3064, Part II, requires enterprises to test
goodwill and other intangible assets not subject to
Page 8 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Handbook standards,
Part II
Comparison of accounting treatments
Significance
of
differences
amortization on an events and circumstances basis,
rather than each year.
This is consistent with the differential reporting option
in XFI Section.
Section 3064, Part II, requires goodwill impairment
testing to be done at the reporting unit level, removing
the requirement in XFI Section to determine fair values
of individual assets and liabilities.
Section 3065, Leases
Section 3065, Leases
Certain guidance from EIC-133 has been incorporated
in Section 3064, Part II (see 3064.68).
Section 3065, Part II, is converged with XFI Section,
except that the requirements for (a) removing a lease
liability from a lessee’s balance sheet, and (b) the
impairment testing of lease receivables of a lessor in
Section 3065, Part II, are consistent with those in
Section 3856, Part II.
Not significant.
Certain guidance from the following EIC Abstracts has
been incorporated into Section 3065, Part II:
• EIC-19 (see 3065.03(r);
• EIC-21 (see 3065.27);
• EIC 25 (see 3065.64 and Illustrative Examples 3 and
4);
• EIC-52 (see 3065.25 and Illustrative Example 5);
and
Page 9 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Handbook standards,
Part II
Comparison of accounting treatments
•
Section 3110, Asset
Retirement Obligations
Section 3110, Asset
Retirement Obligations
Significance
of
differences
EIC-97 (see 3065.26).
Section 3110, Part II, is converged with XFI Section
except that the measurement requirements have been
simplified.
Significant.
Under Section 3110, Part II, asset retirement obligations
are measured at the best estimate of the expenditure
required to settle the present obligation at the end of the
reporting period, rather than at fair value.
Section 3210, Long-term
Debt
—
No corresponding standard in Part II.
—
Guidance provided in Section 3856, Part II.
Section 3240, Share
Capital
Section 3240, Share
Capital
Section 3240, Part II, is converged with XFI Section.
None.
Section 3250, Surplus
Section 3251, Equity
All requirements in this Section relate to presentation,
which is outside the scope of this summary comparison.
—
The scope of Section 3251, Part II, is broader than XFI
Section 3250.
Certain guidance from EIC-132 has been incorporated
into Section 3251, Part II (see 3251.10).
Section 3260, Reserves
Section 3260, Reserves
Section 3260, Part II, is converged with XFI Section.
None.
Page 10 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Section 3280,
Contractual Obligations
Handbook standards,
Part II
Significance
of
differences
Section 3280, Contractual
Obligations
All requirements in this Section relate to disclosures,
which are outside the scope of this summary
comparison.
—
Section 3290,
Contingencies
Section 3290,
Contingencies
Section 3290, Part II, is converged with XFI Section.
None.
Section 3400, Revenue
Section 3400, Revenue
Section 3400, Part II, is converged with XFI Section.
None.
Comparison of accounting treatments
Certain guidance from the following EICs has been
incorporated into Section 3400, Part II:
• EIC-78 (see 3400.17);
• EIC-79 (see 3400.22);
• EIC-123 (see 3400.23-.24);
• EIC-141 (see 3400.07-.10);
• EIC-142 (see 3400.11);
• EIC-144 (see 3400.25-.27); and
• EIC-156 (see 3400.28).
Section 3461, Employee
Future Benefits
Section 3461, Employee
Future Benefits
Section 3461, Part II differs from XFI Section.
Significant.
Section 3461, Part II, permits defined benefit plans to be
recognized and measured using either:
• an “immediate recognition approach,” whereby the
accounting is based on a funding valuation, the
funded status of the plan is recognized on the
balance sheet and there is no deferral or amortization
of actuarial gains and losses or past service costs; or
Page 11 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
• the “deferral and amortization approach” as in the
XFI Section, which requires a separate valuation for
accounting purposes and deferral and amortization is
required for past service costs and permitted for
actuarial gains and losses.
The definitions of a defined benefit plan and a defined
contribution plan have been modified. The difference is
not expected to be significant for most private
enterprises.
Section 3465, Income
Taxes
Section 3465, Income
Taxes
Section 3465, Part II, is converged with XFI Section.
Under Section 3465, Part II, either the taxes payable
method or the future income taxes method may be
chosen. This is consistent with the differential reporting
option in XFI Section.
None.
Certain guidance from the following EIC Abstracts has
been incorporated into Section 3465, Part II:
• EIC-104 (see 3465.75); and
• EIC-146 (see 3465.65).
Section 3475, Disposal of Section 3475, Disposal of
Long-lived Assets and
Long-lived Assets and
Discontinued Operations Discontinued Operations
Section 3480,
Extraordinary Items
—
Section 3475, Part II, is converged with XFI Section.
None.
No corresponding standard in Part II.
—
Page 12 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Section 3500, Earnings
per Share
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
—
No corresponding standard in Part II.
—
Section 3610, Capital
Transactions
Section 3610, Capital
Transactions
Section 3610, Part II, is converged with XFI Section.
None.
Section 3800,
Government Assistance
Section 3800, Government Section 3800, Part II, is converged with XFI Section.
Assistance
None.
Section 3805, Investment
Tax Credits
Section 3805, Investment
Tax Credits
Section 3805, Part II, is converged with XFI Section.
None.
Section 3820, Subsequent
Events
Section 3820, Subsequent
Events
Section 3820, Part II, is converged with XFI Section.
None.
Section 3831, Nonmonetary Transactions
Section 3831, Nonmonetary Transactions
Section 3831, Part II, is converged with XFI Section.
None.
Section 3840, Related
Party Transactions
Section 3840, Related
Party Transactions
Section 3840, Part II, is converged with XFI Section.
None.
Certain guidance from the following EIC Abstracts has
been incorporated into Section 3840, Part II:
• EIC-66 (see 3840.44(a));
• EIC-77 (see 3840.38);
• EIC 89 (see 3840.44(b)); and
• EIC-103 (see 3840.33).
Section 3841, Economic
Section 3841, Economic
Dependence
All requirements in this Section relate to disclosures,
which are outside the scope of this summary
—
Page 13 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Dependence
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
comparison.
Section 3850, Interest
Capitalized
Section 3850, Interest
Capitalized
All requirements in this Section relate to disclosures,
which are outside the scope of this summary
comparison.
—
—
Section 3856, Financial
Instruments
Section 3856, Part II, differs from equivalent
requirements under XFI standards. The requirements in
Section 3856, Part II, correspond to or replace guidance
in Sections 3020, 3025, 3210, 3860, AcG-4, AcG-12
and AcG-13.
Significant.
The significant differences between the guidance on
financial instruments in XFI standards and Section
3856, Part II, include the following:
• Investments in equities that are traded in an active
market are measured at fair value, with changes
recognized in net income. An entity may also
irrevocably elect on initial recognition to measure
any other financial instrument at fair value.
Derivatives, other than those in qualifying hedges,
continue to be measured at fair value.
• A single model is applied to the recognition and
measurement of impairment for all financial assets.
• All financial instruments are recognized on trade
date.
• Transaction costs on financial instruments measured
at amortized cost are capitalized. Transaction costs
Page 14 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Handbook standards,
Part II
Comparison of accounting treatments
Significance
of
differences
on financial instruments measured at fair value are
expensed.
• The equity component of convertible debt and
warrants or options issued with, and detachable
from, financial liabilities may be measured at zero.
• Hedge accounting is available by designation for
relationships specified in the Section if the critical
terms of the hedging instrument match those of the
hedged instrument.
• Preferred shares issued in a specified tax planning
arrangement must be classified as equity. (This is
consistent with the differential reporting option in
XFI Section 3860.)
Certain guidance from the following Sections,
Accounting Guidelines and EIC Abstracts and has been
included in Section 3856, Part II:
• Section 3020 (see 3856.16-.19);
• Section 3025 (see 3856.16-.19);
• AcG-4 (see 3856.07);
• AcG-12 (see 3856, Appendix B.);
• AcG-13 (see 3856.30-.36);
• EIC-88, 96 and 101 (see 3856.26-.29);
• EIC-149 (see 3856.20-.23); and
• EIC-158 (see 3856.14).
Page 15 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
Section 3860, Financial
Instruments – Disclosure
and Presentation
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
—
No corresponding standard in Part II. Guidance
provided in Section 3856, Part II.
—
Section 3870, Stockbased Compensation and
Other Stock-based
Payments
Section 3870, Stock-based
Compensation and Other
Stock-based Payments
Section 3870, Part II, differs from XFI Section.
Significant.
Section 4100, Pension
Plans
—
No corresponding standard in Part II. The accounting
standards for pension plans can be found in Part IV.
—
Section 4211, Life
Insurance Enterprises –
Specific Items
Section 4250, FutureOriented Financial
Information
—
No corresponding standard in Part II.
—
—
No corresponding standard in Part II.
—
Section 3870, Part II, replaces the minimum value
method (i.e., the ability to ignore volatility in measuring
stock-based compensation), with the calculated value
method. Under the calculated value method an
enterprise estimates the volatility that is used as an input
to a stock option pricing model based on an appropriate
sector index.
Page 16 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
AcG-2, Franchise Fee
Revenue
Handbook standards,
Part II
AcG-2, Franchise Fee
Revenue
AcG-2, Part II, is converged with XFI Guideline.
Significance
of
differences
None.
AcG-3, Financial
Reporting by Property
and Casualty Insurance
Companies
—
No corresponding Guideline in Part II.
—
AcG-4, Fees and Costs
Associated with Lending
Activities
—
No corresponding Guideline in Part II.
Guidance provided in Section 3856, Part II (see
3856.07).
—
AcG-7, The Management
Report
—
No corresponding Guideline in Part II.
—
AcG-8, Actuarial
Liabilities of LifeInsurance Enterprises –
Disclosure
AcG-9, Financial
Reporting by Life
Insurance Enterprises
—
No corresponding Guideline in Part II.
—
—
No corresponding Guideline in Part II.
—
AcG-11, Enterprises in
the Development Stage
—
No corresponding Guideline in Part II.
—
Comparison of accounting treatments
Page 17 of 18
(As of December 31, 2009)
Handbook
standards
Part V (XFI)
AcG-12, Transfers of
Receivables
Handbook standards,
Part II
Significance
of
differences
Comparison of accounting treatments
—
No corresponding Guideline in Part II. Guidance
provided in Section 3856, Part II (see 3856, Appendix
B).
—
AcG-13, Hedging
Relationships
—
No corresponding Guideline in Part II. Guidance
provided in Section 3856, Part II (see 3856.30-.36).
AcG-14, Disclosure of
Guarantees
AcG-14, Disclosure of
Guarantees
AcG-14, Part II, is converged with XFI Guideline.
None.
AcG-15, Consolidation of AcG-15, Consolidation of
Variable Interest Entities Variable Interest Entities
AcG-15, Part II, is converged with XFI Guideline.
AcG-15, Part II, does not apply to an enterprise that
chooses to prepare non-consolidated financial
statements.
None.
AcG-16, Oil and Gas
Accounting – Full Cost
AcG-16, Oil and Gas
Accounting – Full Cost
AcG-16, Part II, is converged with XFI Guideline.
None.
AcG-17, Equity-linked
Deposit Contracts
—
No corresponding Guideline in Part II.
AcG-18, Investment
Companies
AcG-18, Investment
Companies
AcG-18, Part II, is converged with XFI Guideline.
None.
AcG-19, Disclosures by
Entities Subject to Rate
Regulation
AcG-19, Disclosures by
Entities Subject to Rate
Regulation
All requirements in this Guideline relate to disclosures,
which are outside the scope of this summary
comparison.
—
Page 18 of 18