Using this Framework can enhance the relevance of financial information for all entities – from public and private companies, to not-for-profit organizations and pensions plans.
"The AcSB is taking a leadership role in the development of this Framework by starting the conversation and connecting all parties involved in the financial reporting process," says Linda Mezon, Chair, AcSB. "While financial statements provide a strong foundation for financial reporting, there's more information that financial statement users consider – including performance measures – when they make investment, contributing and lending decisions."
The AcSB is therefore responding to concerns raised by many investors, contributors, lenders and other resource providers about performance measures used by entities today. The voluntary Framework aims to address such concerns as:
The quality of performance measures being reported.
The lack of consistency, transparency and comparability of performance measures reported.
The "expectation gap" about the governance practices of entities over how performance measures are developed and reported, and whether those measures are subject to assurance.
While performance measures range from measures under GAAP to non-financial or operational measures, this Framework provides guidance on selecting and determining performance measures outside of GAAP. It will help entities report a performance measure by setting out a process broken down into principles or building blocks.
As a follow up to this Framework, and in response to market and user concerns, the Board intends to work with Chartered Professional Accountants of Canada (CPA Canada) to develop additional guidance that is industry or sector specific.
The AcSB is requesting feedback on the Draft Framework for Reporting Performance Measures by September 17, 2018.
Join the discussion and help improve financial and non-financial performance measures reported outside financial statement by all types of entities.
About the AcSB The AcSB supports informed economic decision making by maintaining frameworks that provide a basis for high-quality information about financial performance reported by Canadian private sector entities. www.frascanada.ca