Financial Administration Manual

125 - Accounting Policies and Practices

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Effective: April 1, 2016
Section: Governance
Administrator: Office of the Comptroller General
Applicability: GNWT Departments and Public Agencies

POLICY

Accounting policies and practices must conform to Canadian generally accepted accounting principles (GAAP) as described in the CPA Canada Handbook – Accounting or the CPA Canada Public Sector Handbook, as applicable. Where options for accounting standards are permitted within GAAP, a Public Agency must consult with the Comptroller General prior to a final determination of an accounting standard.

PURPOSE            

To provide financial statements and other financial information to users to ensure that the information is presented fairly, satisfies the financial statement assertions as described in GAAP, applicable to the organization, and meets the following qualitative characteristics of financial information:

  • Understandability of the information by readers;
  • Comparability between fiscal years and between similar types of entities;
  • Relevance for decision-making (provides information that is timely, provides feedback and demonstrates accountability);
  • Reliability (faithfully represents the transactions and events being reported upon)
  • Neutrality (free from bias); and
  • Conservatism (amounts and disclosures are not overstated or understated).

SCOPE

Applies to all financial statements and financial transactions.

RESPONSIBILITIES

Deputy Head

Ensure that sufficient financial expertise exists to comply with this policy on an ongoing basis.

Comptroller General

Ensure compliance by GNWT Departments and Public Agencies with respect to accounting policies and practices; may approve Interpretation Bulletins associated with this policy.

Minister of Finance

Monitor the financial management systems to ensure alignment with approved financial management policies and procedures.

Financial Management Board

Act on matters related to accounting policies and practices; may adopt an accounting policy or practice for the GNWT that departs from the standards in the CPA Canada Public Sector Accounting Handbook; May direct a Public Agency on matters respecting financial management or financial administration of a Public Agency; may direct a Public Agency or other reporting body to adhere to specified standards or guidelines in respect of accounting policies and practices that may depart from Canadian generally accepted accounting principles for a body of that nature; may issue a directive respecting the financial management or financial administration of a Public Agency.

AUTHORITIES and REFERENCES

  • Financial Administration Act (FAA)
    • s. 7 – Duties: Board
    • s. 10 – Board directives
    • s. 13 – Minister of Finance
    • s.16 – Comptroller General
    • s. 20 – Accounting policies and practices
    • s. 20 – Accounting policies and practices
      • Canadian Public Sector Accounting Standards as per s. 20 of the FAA is synonymous with CPA Canada Public Sector Accounting Handbook
  • s. 25 – Public agencies
  • s. 37 – Internal Audit Bureau
  • s. 25 – Public agencies
  • s. 37 – Internal Audit Bureau
  • Northwest Territories Act
  • CPA Canada Handbook – Accounting
  • CPA Canada Public Sector Accounting Handbook

INTERPRETATION BULLETINS