Municipal Affairs

August 4, 2008

Municipalities and Inuit communities in the province have participated in information sessions on public sector accounting as they prepare to adopt financial reporting standards.

The final of 15 Public Sector Accounting Board (PSAB) province-wide training information sessions took place on July 29 in Happy Valley-Goose Bay. Of the province�s 277 municipalities and five Inuit community governments, 217 registered and attended a session.

The Canadian Institute of Chartered Accountants (CICA), through the Public Sector Accounting Board (PSAB), sets the standards for government accounting and financial reporting. All governments in Canada, including local governments, must adopt PSAB generally accepted accounting practices (PSAB GAAP).

"The Provincial Government is pleased to provide leadership, direction, guidance and assistance to all local governments with respect to their adoption and use of PSAB accounting rules," said the Honourable Dave Denine, Minister of Municipal Affairs. "I am happy to see that so many municipalities participated in these important sessions and I congratulate them on taking the initiative to ensure they are fully prepared to adopt and use the PSAB accounting rules."

While these standards are not new, the requirement for municipalities to start reporting under PSAB has not been mandatory until now. This will affect all incorporated Newfoundland and Labrador municipalities and Inuit community governments by requiring them to prepare their financial statements in accordance with PSAB GAAP. This means that their statements will have to include such items as tangible capital assets (amortized over useful lives), accruals and environmental liabilities.

Phase one of the Provincial Government�s plan to assist municipalities prepare for PSAB compliance is now complete. Phase two is currently being developed and will include additional information sessions and the launch of the PSAB resource website.

"I applaud the efforts municipalities have made to date and we look forward to continuing to assist them with becoming fully prepared for PSAB implementation," said Minister Denine. "Municipalities are reminded that the Gas Tax community agreement between municipalities and the province requires municipalities to be PSAB compliant by March 31, 2009. While we are confident that municipalities will make every effort to do so, we recognize that it may not be possible for all towns to become fully compliant by this date. In these cases, a note in the financial statement identifying the municipalities plan and where they are in the plan to become PSAB compliant will be acceptable."

For more information on PSAB or to obtain the TCA reference manual, please call toll-free 1-877-729-4393 or e-mail: PSAB@gov.nl.ca

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Media contact:
Jennifer Collingwood
Director of Communications
Department of Municipal Affairs
709-729-1983, 690-2498
JenniferCollingwood@gov.nl.ca

2008 08 04                                                    10:10 a.m.