Accounting in Canada

Overview by

Accounting System

Accounting Standards
Annual accounts in Canada are drawn up based to a great extent on the Generally Accepted Accounting Principles (GAAP).
The Accounting Standards Board of the Canadian Institute of Chartered Accountants (CICA) establishes accounting and financial information standards.
Accounting Regulation Bodies
Canadian Accounting Standards Board
Accounting Law
The GAAP are principally defined by:
- the Canada Business Corporations Act (CBCA) of 1985
- the CICA handbook.
Difference Between National and International Standards (IAS/IFRS)
Since 2007, the Order of Chartered Accountants has adopted the IFRS standards. Many aspect of the Canadian accounting standards are similar to IFRS standards. To access the details, consult the CICA website.
Accounting News
EIN News on Canada

Accounting Practices

Tax Year
The calendar tax year begins on 1 January and finishes on 31 December of the same year.
A company may also choose to establish a tax year of 12 consecutive months on diffrent basis. For example: from 1 June to 31 May.
Accounting Reports
Financial accounts in Canada usually include a balance sheet, a profit and loss account, a statement of retained earnings and a cash flow statement.

BALANCE SHEET: 12 pre-determined consecutive months;
1) Assets
2) Liabilities
3) Shareholder balance
Publication Requirements
The recommendations in the CICA handbook apply to all Canadian companies. Specific regulations apply to banks, insurance companies and public organizations.
Reporting of financial statements and balance sheets is yearly. Companies listed on the Stock Exchange must provide quarterly financial reports.

Accountancy Profession

Accountants : plan, organize and administer accounting systems for individuals or establishments. Financial auditors and accountants are employed by auditing and accounting firms throughout the private and public sectors, or they may be self-employed. Financial auditors:

Financial auditors : Financial auditors examine and analyze the accounting and financial records of individuals and establishments to ensure accuracy and compliance with established accounting standards and procedures.
Professional Accountancy Bodies
CICA, Canadian Institute of Chartered Accountants
CMA, Order of Certified Management Accountants
CPAB, Canadian Public Accountability Board
Member of the International Federation of Accountants (IFAC)
Member of Other Federation of Accountants
Canada is a member of The American Institute of Certified Public Accountants and a member of the Confederation of Asian and Pacific Accountants (CAPA) which represents the national accountancy organisation in the Asia-Pacific region.
Audit Bodies
Companies have to seek a statutory auditor to conduct an annual audit of the financial health of their organization.
You can contact an external auditor: DELOITE & TOUCHE, KPMG.

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