Disclaimer. PSAB approved an Asset Retirement Obligations project. New changes impacting public sector accounting and finance are underway and will significantly affect public sector organizations in the years to come. 17 Aug 2020 PDF. The project will address the reporting of legal obligations associated with the retirement of long-lived tangible capital assets currently in productive use. Obtaining early understanding of this standard’s effects is important, as the impact on some public sector entities may be significant. j)Asset Retirement Obligations PS3280 (for fiscal years beginning on or after April 1, 2021 – see Note 2 w)) (Prior to implementation of PS3280, refer to GAAP Hierarchy in PS 1150 for other sources of GAAP, which may include international financial reporting standards or Canadian accounting standards for private enterprise.) PS 3280 Asset Retirement Obligations (cont’d) Determining which standard should be applied Section PS 3280 Section PS 3260 Cause for the retirement or remediation obligation • Acquisition, construction, development, normal use. Our partner-led practice group provides an integrated suite of services to help our Indigenous clients. This new Section establishes standards on how to account for and report a liability for asset retirement obligations. Early adoption is permitted. adm.com. Release of the Asset Retirement Obligation section and the new Revenues section. Entities at the same time must recognize an offsetting asset retirement cost by increasing the carrying amount of the related long-lived asset. Municipal councils have a vital role to play in setting the tone for a successful implementation and financial reporting success. X PSAB _ Other Issue Description In March 2017, the Public Sector Accounting Standards Board released a new exposure draft entitled Asset Retirement Obligations, Proposed Section PS 3280. The project is expected to commence in 2012. This new Section will be effective for fiscal years beginning on or after April 1, 2021. Early adoption is permitted. That is, standards that apply to assets that are in productive use. Asset Retirement Obligation is a legal and accounting requirement, in which a company needs to make provisions for the retirement of a tangible long-lived asset in order to bring the asset back to its original condition after the business is done using the asset. On March 9, 2017, the PSAB issued an Exposure Draft that proposes a new standard PS 3280 on asset retirement obligations. How to adopt construction technology in a smart and minimally disruptive way. DTTL (also referred to as "Deloitte Global") and each of its member firms are legally separate and independent entities. Whether you are a university, health November 21, 2018. We've created the BDO Library as a "go to" source for informative and thought provoking knowledge resources. Asset retirement obligation/decommissioning cost broadly refers to the amount that a company expects to incur in disposing of the asset and reversing modifications made to the installation site. Please turn off compatibility mode, upgrade your browser to at least Internet Explorer 9, or try using another browser such as Google Chrome or Mozilla Firefox. Navigating the Challenges in Professional Services. Visit: https://www.farhatlectures.com To access resources such as quizzes, power-point slides, CPA exam questions, and CPA simulations. For inquiries and feedback … The main features of the Section are: An asset retirement obligation is a legal obligation associated with the retirement of a tangible capital asset. In July 2016, the staff updated this project to indicate that the PSAB now expects to issue an Exposure Draft in Q1/2017. About PSAB. Each word should be on a separate line. Asset Retirement Obligation is a legal and accounting requirement, in which a company needs to make provisions for the retirement of a tangible long-lived asset in order to bring the asset back to its original condition after the business is done using the asset. AcSOC. It was a logical progression for PSAB to consider whether standards were required for Asset Retirement Obligations (“AROs”). Slide 5 WHAT’S COMING? 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