KPMG Enterprise and CFERF Study Examines
Private Company Financial Reporting
TORONTO, April 28 /CNW/ - Canada's Accounting Standards Board (AcSB)
plans to release its proposals for a "made in Canada" private company
financial reporting framework (GAAP) by April 30. Canada's private companies
will have to adopt either International Financial Reporting Standards (IFRS)
or the proposed private company GAAP by 2011.
According to the findings of a recent joint study conducted by KPMG
Enterprise(TM) and the Canadian Financial Executives Research Foundation
(CFERF), the research institute of FEI Canada, the anticipated standards are
generally supported by private company finance executives from across Canada.
The executives caution, however, that differences between private company GAAP
and IFRS, which will be adopted by public companies by 2011, may present
challenges in accessing equity and debt financing if there is inadequate
comparability of financial reporting under the two standards. According to the
study, one in four of Canada's leading private companies plans to adopt IFRS.
"Private companies operate in a unique set of circumstances," said Bob
Young, Partner, National Assurance & Professional Practice at KPMG Enterprise.
"We need to understand the impact of the proposed changes on those companies,
the implications to peer comparison, and the overall perception of
transparency so that expectations can be managed."
The study also showed that smaller companies were more concerned about
the costs of adopting IFRS than about comparability, and will ultimately rely
on a thorough assessment of the costs and benefits before making a decision to
adopt the international standard or the new Canadian standard. For companies
planning an IPO, IFRS will be required. "It will depend on each individual
business case," says Ramona Dzinkowski, Executive Director of CFERF, "whether
or not to adopt IFRS. There are pros and cons either way that will be unique
in each circumstance."
The study also showed that CFOs were concerned that the simplifications
incorporated in Canadian private company GAAP may result in a perception that
private company CFOs will not have the same level of technical accounting
skills as their public company counterparts, which could impact the ability of
private businesses to attract and retain financial accounting resources.
According to Bob Young, "The profession needs to ensure that senior
financial executives are equipped with the knowledge and tools needed to
execute their job function, regardless of the size and nature of their
organization and the accounting framework it applies."
The KPMG Enterprise-FEI Canada Executive Research Study was conducted
from Thursday, January 15, 2009, to Friday, February 6, 2009, and an Executive
Research Forum was held in Toronto on February 24, 2009.
About KPMG Enterprise
KPMG Enterprise is a network of professionals devoted exclusively to
serving private companies 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 144 countries and have more
than 137,000 professionals working around the world.
Please visit www.kpmg.ca/enterprise for further information.
The Canadian Financial Executives Research Foundation is the research
institute of FEI Canada. FEI Canada is an all-industry professional membership
association for senior financial executives. With eleven chapters across
Canada and more than 2,000 members, FEI Canada provides professional
development, thought leadership and advocacy services to its members. The
association membership, which consists of Chief Financial Officers, Audit
Committee Directors and senior executives in the Finance, Controller, Treasury
and Taxation functions, represents a significant number of Canada's leading
and most influential corporations. Further information can be found at
For further information:
For further information: or to schedule an interview, please contact:
Shilpa Kotecha, Media Relations, KPMG Enterprise, (416) 777-8918,
firstname.lastname@example.org; Caroline Spivak, Media Relations, FEI Canada, (416)