Canada: Issues Relating To Changeover To IFRS — More From CSA Staff

In our May 2008 issue, we reported on the push in Canada for the transition from the use of Canadian generally accepted accounting principles (GAAP) to the use of International Financial Reporting Standards (IFRS), and we discussed the Canadian Securities Administrators' (CSA) Concept Paper 52-402 Possible Changes to Securities Rules Relating to International Financial Reporting Standards and CSA Staff Notice 52-320 Disclosure of Expected Changes in Accounting Policies Relating to Changeover to International Financial Reporting Standards.

In our May 2009 issue, we reported on CSA Staff Notice 52-321 Early adoption of International Financial Reporting Standards, use of US GAAP and reference to IFRS-IASB and we discussed exemptive relief applications to permit early adoption of IFRS.

On May 21, 2009, the CSA issued CSA Staff Notice 52-324 Issues relating to changeover to International Financial Reporting Standards, which provided an update on several issues related to the changeover to IFRS in Canada, including:

  • more on the use of IFRS by a domestic issuer for periods beginning prior to January 1, 2011;
  • requirements for interim financial statements in the year of IFRS adoption; and
  • reference to IFRS and Canadian GAAP.

In CSA Staff Notice 52-324, the CSA said that it expected to publish, later in 2009, details of the proposals discussed in the Notice. Some of these proposals are described briefly in this article.

Exemptive Relief for Early Adoption of IFRS

In CSA Staff Notice 52-321, the CSA had indicated that CSA staff were prepared to recommend exemptive relief to permit a domestic issuer to prepare its financial statements in accordance with IFRS for periods beginning prior to January 1, 2011. In CSA Staff Notice 52-324, the CSA reports that several exemption orders have been issued with the condition that the issuer file revised interim financial statements prepared in accordance with IFRS, revised interim management discussion and analysis, and new interim certificates.

CSA Staff Notice 52-324 also describes the Accounting Standards Board (AcSB) publication Adopting IFRSs in Canada, II, which disclosed the expectation that IFRS for publicly accountable enterprises will be incorporated into Part I of the CICA Accounting Handbook in the second half of 2009 and the standards constituting Canadian GAAP before the mandatory effective date of January 1, 2011 will be contained in Part IV of the Handbook. Because securities legislation refers to Canadian GAAP as applicable to public enterprises, and defines Canadian GAAP as generally accepted accounting principles determined with reference to the Handbook, CSA staff consider the standards in Part IV to be Canadian GAAP as applicable under securities legislation until January 1, 2011, so the use of IFRS in Part I prior to that date will continue to require exemptive relief. Part IV will eventually be removed from the Handbook.

Interim Financial Statements in the Year of IFRS Adoption

CSA Staff Notice 52-324 proposes that the CSA require the issuer to disclose compliance with International Accounting Standard 34 Interim Financial Reporting in its interim financial statements, commencing with the first interim financial statement in the financial year in which it adopts IFRS. The CSA also proposes to require a domestic issuer to include a balance sheet that complies with IFRS as at the issuer's "transition date" in its first interim financial statements in the first financial year that the issuer adopts IFRS. An issuer's transition date is the beginning of the earliest comparative period presented in the financial statements. So, an issuer that has a calendar year-end and that elects not to "early adopt" IFRS will be required to include, along with its quarterly financial statements for the period ended March 31, 2011, a balance sheet that complies with IFRS as at January 1, 2010. If the interim financial statements for the period ending March 31, 2011 have not been the subject of auditor review, those statements must be accompanied by a notice indicating that fact. The issuer's audited financial statements for the year ended December 31, 2011 will be required to be presented with an auditor's report for the balance sheet dated January 1, 2010.

Reference to IFRS in Canadian GAAP

In CSA Staff Notice 52-321, the CSA had stated that it preferred that reference be made to IFRS issued by the IASB, rather than to Canadian GAAP, in financial statements and audit reports for domestic issuers after the mandatory effective date. Based on input from stakeholders and the Canadian Accounting Standards Board, the CSA now proposes to allow an issuer to choose between referring:

  • only to IFRS in the notes to the financial statements and in the auditor's report; or
  • to both IFRS and Canadian GAAP in the notes to the financial statements and in the auditor's report.

The CSA now proposes that these two options be implemented by requiring domestic issuers to prepare annual and interim financial statements for the financial years beginning on and after January 1, 2011 as follows:

  • the annual and interim financial statements must be prepared in accordance with Canadian GAAP for publicly accountable enterprises;
  • an explicit and unreserved statement of compliance with IFRS (as issued by the IASB) must be made in the notes to the financial statements and disclosure of compliance with International Accounting Standards 34 be made in the interim financial statements; and
  • the auditor's report must refer to IFRS and be in the form specified by Canadian generally accepted auditing standards for financial statements prepared in accordance with a fair presentation framework.

This will enable issuers to continue to refer to Canadian GAAP to satisfy existing contractual obligations, such as definitions in credit agreements, and to comply with other laws, rules and regulations that require Canadian GAAP.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.