THE TOWN OF GRAVENHURST IS PSAB COMPLIANT!

The Public Sector Accounting Board (PSAB) has mandated major changes to municipal financial reporting. These changes take effect January 1, 2009 and will be implemented and in force by the time the Town of Gravenhurst publishes their 2009 Financial Statements in the spring of 2010.

The biggest change is in how we account for tangible capital assets. The term “tangible capital assets” refers to roads, sewers, water mains, recreation centers, snow plows, computers and other such economic resources that: 

• Allow us to produce something, do our jobs, and deliver services
• Have a useful economic life of more than one year
• Help us to create, fix or maintain an asset

Municipalities currently operate on an “expenditure accounting” basis, i.e. all expenditures are recorded when they are incurred.

Capital Asset Accounting requires that we:

• Value these assets at cost and
• Recognize a part of that cost in our financial statements each year over the life of the asset
  (known as amortization).
  

Other changes implemented by PSAB affect the reporting requirements of the municipality. Specifically, we will no longer present the financial statements by Operating Fund and Capital Fund. The financial statements will consist of a Statement of Financial Position, Statement of Financial Activities, Statement of Net Debt and Statement of Cash Flows that will include combined transactions (revenues and expenses) from the previous Operating and Capital Fund Statements.

Questions related to PSAB accounting please contact Theresa Trott, Administrative Assistant, Capital Assets.