How might an enterprise describe the basis of accounting used to prepare the financial statements?
Paragraph 1400.16 requires an enterprise following Part II of the CICA Handbook – Accounting to state that the financial statements have been prepared in accordance with Canadian accounting standards for private enterprises. An enterprise may wish to refer to Canadian GAAP, for example to meet contractual or legislative requirements. In addition to stating that the financial statements have been prepared in accordance with Canadian accounting standards for private enterprises, an enterprise following these standards may make an additional statement that the financial statements have been prepared in accordance with Canadian GAAP. As noted above, each Part of the CICA Handbook – Accounting represents a form of Canadian GAAP. The accounting standards for private enterprises in Part II of the Handbook are therefore Canadian GAAP. Consequently making a separate reference to Canadian GAAP might be viewed as redundant – it is up to the individual enterprise to decide whether to do so or not.
