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Halifax Regional Municipality Goes PSAB Compliant
(December 7, 2005)--- Effective with the 2004/05 audited financial statements, Halifax Regional Municipality has adopted Public Sector Accounting Board (PSAB) recommendations for local government reporting.
“It is appropriate that a municipality the size and complexity of HRM produce PSAB compliant financial statements,” said Dale MacLennan, Director of Finance for HRM. “PSAB compliant financial statements aid HRM in comparing itself with other Canadian municipalities and over time will provide Council with a more complete picture of our financial position.”
Nova Scotia municipalities have traditionally prepared special purpose annual financial statements. These statements serve the central purpose of calculating the tax rate and setting the annual operating budget.
In contrast, general purpose financial statements focus on the overall consolidated financial position of HRM. With the 2004/05 audited financial statements, HRM is now producing general purpose consolidated financial statements which comply with Generally Accepted Accounting Principles (GAAP) for Canadian municipalities.
As required by the Province of Nova Scotia, HRM will still produce Special Purpose financial information as the basis for the approval of the annual operating budget and calculation tax rates.
The benefits of general purpose financial statements include an improved ability to compare HRM results with other Canadian municipalities. In addition, because these statements are general purpose and based on Generally Accepted Accounting Principles for Canadian Municipalities, they are more readily understood by a broader range of financial report users.
The next step in this process will be to respond to direction that will come from the Public Sector Accounting Board (PSAB) on how local governments in Canada will account for tangible capital assets.
“Accounting for Tangible Capital Assets is next, but for now, this represents the completion of a significant amount of work, and a major improvement in reporting on HRM’s consolidated financial position.” said MacLennan.
Director of Finance