Directive on Accounting Standards: GC 3390 Contractual Obligations

Supports the Public Sector Accounting Handbook (PSAH) in stating the Government's accounting policies for contractual obligations.
Date modified: 2017-04-01
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This document is part of the Appendix A of the Directive on Accounting Standards.

A. Primary PSAS references

  • PS 3390 Contractual obligations

B. Effective date

C. Government of Canada Consolidated Financial Statements

  1. While PS 3390 defines contractual obligations within the Government, it is further clarified that a “subject to funding” clause does not exclude a contractual obligation from being reported. Contracts with subject to funding clauses (i.e. funding by government appropriations) are considered irrevocable contractual obligations, as all contractual obligations of the Government are subject to funding, according to the Financial Administration Act, Section 40(1).

D. Departmental Financial Statements

  1. Departments and agencies should provide details of significant contractual obligations in their departmental financial statements. Significance is assessed based on the departmental materiality policy without consideration for Public Accounts materiality levels.

E. Other related references

  • Receiver General Manual - Chapter 15 - Public Accounts Instructions
  • Financial Administration Act, Section 40
  • GC 4500 Departmental Financial Statements
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