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In Budget 2001(Annex 6), the Minister of Finance announced that the Government has decided to delay the implementation of full accrual accounting for the purpose of the Government's audited financial statements.
It is government convention that the audited financial statements report on the same basis of accounting as that used in the budget. Given the timing of this budget and the fact that important components of the information required to implement full accrual accounting have not yet been verified and audited, it is not possible to move to a full accrual basis of accounting for that purpose at this time.
Despite this announcement, departments and agencies are still required to conform to the accounting requirements and guidance already issued in the Transition Protocol, Treasury Board Accounting Standards, the FIS Accounting Manual and Receiver General Directives.
The postponement of the implementation of full accrual accounting for the Federal Budget and the Government's audited financial statements will have minimal impact on departments and agencies. The finalization of opening asset and liability balances in support of the move to full accrual accounting will continue as planned, including their audit by the Office of the Auditor General. This audit verification is underway now and essential.
Full accrual accounting information will continue to be submitted by departments to the Receiver General for Canada. This information will be compiled and verified to support the preparation of full accrual financial statements at a later date. Departments and agencies will continue with the implementation of the Financial Information Strategy and full accrual accounting into their day-to-day operations. Departments will be required to produce their financial statements for fiscal year 2001-2002 on the full accrual basis of accounting. A number of departments already prepare their financial statements using the full accrual basis of accounting.
My staff will be happy to provide any and all clarification or assistance you or your financial officers may request. The principal contacts are Bill Bradshaw (952-3404) and Kenneth Wheat (957-9676).
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