TORONTO, Dec. 12 /CNW/ - KPMG Enterprise(TM) today released the results
of its recent survey of private business' financial reporting needs. The
survey results confirm the long-standing view that private businesses in
Canada need a simplified accounting model reflective of the different
information needs of the limited users of their financial statements.
The positive news for Canada's accounting standard setters is that
private businesses value the basic concepts of Canada's existing accounting
framework, including the traditional historic cost measures of assets,
liabilities, revenues and expenses. The ability to compare financial
performance with others in the same industry is also important. However, there
is less support for a number of recent developments in Canadian accounting
standards including the evolution towards fair value measurements and
disclosures. Further, there is only a limited perceived need to be able to
benchmark financial performance against public companies or foreign companies.
The private sector believes that there is accounting standards overload and
that existing differential reporting options, while important, are not
adequate to alleviate this concern.
"Canada's business landscape is shaped by over two million private
companies. They are a major contributor to our economy and it is imperative
that we understand and respond to their needs," said Beth Wilson, Canadian
Managing Partner for KPMG Enterprise, the private-company practice of KPMG.
"We share our clients' concern that Canada's private business sector is
burdened by standards overload."
KPMG's online survey entitled, 'Financial Reporting Standards for Private
Companies', conducted this fall, was distributed to the firm's private company
clients across Canada, as well as to KPMG professionals who are involved in
private company financial reporting. It was used in developing KPMG's response
to the Canadian Accounting Standards Board's call for public comment on
accounting standards for private companies.
KPMG believes that private companies with limited external users of their
financial reporting should not be burdened by the same financial reporting
standards as public companies. KPMG will be carefully assessing and responding
to the recently released white paper of the Canadian Institute of Chartered
Accountants (CICA) proposing a unique financial reporting Framework for
Owner-Managed Enterprises (FOME) to determine if FOME is an appropriate and
"We believe that preparers and users of financial reporting in Canada
would not be well served by a proliferation of accounting models. KPMG
supports the adoption of International Financial Reporting Standards for
public companies and for private companies whose financial statements are
relied upon by external users as their primary source of financial
information, modified by appropriate differential reporting options," said
Wilson. "However, we are very pleased that the CICA is responding to the needs
of the other 1.7 million Canadian private businesses."
About KPMG in Canada
KPMG LLP, a Canadian limited liability partnership established under the
laws of Ontario, is the Canadian member firm affiliated with KPMG
International, a global network of professional firms providing Audit, Tax,
and Advisory services. Member firms operate in 145 countries and have more
than 123,000 professionals working around the world.
The independent member firms of the KPMG network are affiliated with KPMG
International, a Swiss cooperative. Each KPMG firm is a legally distinct and
separate entity, and describes itself as such.
For more information, or to download a copy of 'Financial Reporting
Standards for Private Companies: Survey Results', please visit www.kpmg.ca.
For further information:
For further information: Media contact: Shilpa Kotecha, Media Relations,
KPMG in Canada, email@example.com, (416) 777-8919