2025-2026 Financial Reporting Requirements
Table of contents
1.0 Effective date
These Financial Reporting Requirements ("the FRR" hereafter) form part of the Reporting Guide from the Departments of Indigenous Services Canada (ISC) and Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC). They are effective April 1st 2025 for fiscal year 2025-2026 and will remain in effect for subsequent fiscal years until further notice.
1.1 Context
Reporting on the use of contribution funding to Indigenous peoples and other Canadians is a critical component of the transfer payment management control framework. CIRNAC and ISC ("the Departments" hereafter) must demonstrate to Parliament, through their respective Ministers, that all funds including those transferred to Indigenous and other recipients, are used in accordance with the terms and conditions outlined in the funding agreements.
The Departments review both financial and non-financial information provided by recipients to support annual compliance activities. This review helps determine whether the funds provided are being used for their intended purposes and whether recipients maintain sufficient financial stability required for the continued delivery of funded programs and services.
The FRR are designed to support recipients of contribution funding in meeting the financial accountability, transparency, and reporting obligations outlined in the terms and conditions of their respective funding agreements with the Departments. This document should be read in conjunction with the recipient's funding agreement.
Other stakeholders may be involved in managing the funding agreement, including the recipient's accountant, audit firms, or agencies receiving a portion of the funding. Recipients may share the FRR with all parties involved, as each must understand and comply with the applicable annual financial reporting obligations.
2.0 Scope
This document applies to all recipients receiving contribution funding under a funding agreement with the Departments. The Departments have consolidated their financial reporting standards into this FRR document, which forms an integral part of the Reporting Guide. Recipients who have more than one funding agreement with the Departments need to submit only one financial reporting package to the lead Department.
3.0 Accounting standards
Financial statements are essential elements of accountability by depicting the recipient's financial health and providing information on how much funding was spent and for what purposes. Financial statements also assist in future decision making.
Financial statements are prepared by the recipient and, when required, audited by an independent Chartered Professional Accountant (CPA) auditor who provides an opinion on whether the financial statements are prepared in all material respects, in accordance with the applicable accounting standards from the CPA Canada Standards and Guidance Collection. This publication serves as the authoritative source of comprehensive guidance on accounting and assurance standards in Canada.
Recipients are responsible for determining which accounting standard applies to their organization and seek advice from their CPA auditor as needed.
4.0 References
5.0 Definitions
For the purposes of this document, see Appendix A of the Treasury Board of Canada Directive on Transfer Payments.
6.0 Financial reporting requirements by recipient types
6.1 First Nations, tribal councils and First Nation political organizations
6.1.1 First Nations – Reporting Package F-0080
First Nations defined as a band in subsection 2(1) of the Indian Act (that is not party to a comprehensive self-government agreement given effect by an Act of Parliament), are required under the First Nations Financial Transparency Act (the FNFTA) to publish on their internet site (or cause to be published on an internet site) the following documents within 120 days after the end of their financial year:
- The First Nation's annual consolidated financial statements, audited by an independent CPA auditor. The FNFTA requires First Nations to present their financial statements on a consolidated basis. See the FNFTA Section 2 for the meaning of "consolidated financial statements".
- A Schedule of Remuneration and Expenses disclosing the remuneration paid and the expenses reimbursed to its Chief and each of its Councillors for the financial year, accompanied by an auditor's audit or review report.
First Nations are to provide their financial reports using the F-0080 reporting package and should submit two separate files, as follows:
FILE 1) Documents required under the FNFTA that will be published, on Canada's FNFTA First Nations Profiles internet site including:
- Audited annual consolidated financial statements, including the independent auditor's report (see Section 7.1);
- Schedule of Remuneration and Expenses (Chiefs and Councillors) accompanied by an auditor's audit or review report. This document must be separate from the financial statements;
FILE 2) Documents required but not covered by the FNFTA and that will not be published:
- Special purpose reporting – Schedules of Revenues and Expenses (see Section 7.2);
- Schedule of Remuneration and Expenses (Unelected Senior Officials) accompanied by an auditor's audit or review report.
Please note that neither of the schedules in c) or d) are part of the financial statements. Refer to Section 7.3 for details on the schedules of remuneration and expenses.
6.1.2 Tribal councils and First Nation political organizations – Reporting Packages F-0080 or F-0081
Tribal Councils and First Nation Political Organizations are required to provide their annual financial reporting 120 days after their fiscal year-end. They should refer to their funding agreement, or consult with their responsible departmental officer to determine which reporting package applies to their operations, either F-0080 or F-0081:
For Reporting package F-0080,Tribal Councils and First Nation Political Organizations who provide their financial reports using the F-0080 reporting package are to submit a single file including as follows:
- Annual audited financial statements, including the independent auditor's report
- Special purpose reporting – Schedules of Revenues and Expenses (see Section 7.2)
- Schedule of Remuneration and Expenses (Chiefs and Councillors) accompanied by an auditor's audit or review report
- Schedule of Remuneration and Expenses (Unelected Senior Officials) accompanied by an auditor's audit or review report.
Please note neither of the schedules in c) or d) are part of the financial statements. Refer to Section 7.3 for details on the schedules of remuneration and expenses.
For Reporting package F-0081 Tribal Councils and First Nation Political Organizations who provide their financial reports using the F-0081 reporting package need to submit the following:
- Special purpose reporting – Schedules of Revenues and Expenses (see Section 7.2)
- Cover page with signature from an authorized official approving the financial reporting package.
6.2 Recipients other than First Nations, tribal councils and First Nation political organizations
Recipients other than Tribal Councils and First Nation Political Organizations must refer to their funding agreement, or consult with their responsible departmental officer to determine which reporting package apply to their operations, either F-0190, F-0191 or F-0192.
6.2.1 Reporting Package F-0190
Reporting Package F-0190 required to be provided 120 days after fiscal year-end and comprised of:
- Audited annual financial statements (see Section 7.1);
- Special purpose reporting – Schedule(s) of Revenues and Expenses (see Section 7.2).
6.2.2 Reporting Package F-0191
Reporting Package F-0191 required to be provided 120 days after fiscal year-end comprised of:
- Audited Schedule(s) of Revenues and Expenses (see Section 7.2), accompanied by an auditor's audit report.
6.2.3 Reporting Package F-0192
Reporting Package F-0192 unaudited and required to be provided 90 days after fiscal year-end:
- Special purpose reporting – Schedule(s) of Revenues and Expenses (see Section 7.2)
- Cover page with signature from an authorized official approving the financial reporting package.
6.3 Agencies (also referred to as "Third Parties")
In certain cases, the Departments may provide contribution funding to a recipient who, in turn, transfers a portion or all of these funds along with the related obligations (such as program and service delivery) to an agency, as specified in the terms and conditions of the funding agreement. In such situations, the original recipient remains fully accountable for fulfilling all obligations outlined in the funding agreement.
The recipient and agency must have their own terms and conditions for the management of contribution funding by the agency. The agency must provide to the recipient its financial statements as the Departments may ask for a copy of the agency's financial statements upon written request to the recipient.
7.0 Financial reporting description
7.1 Annual audited financial statements
Please note: Restatements of audited financial statements should only be considered if an event classified as exceptional occurs (e.g. a material inaccuracy due to an accounting error, non-compliance with GAAP - Generally Accepted Accounting Principles, etc.). CPA Canada Standards are to be applied when a restatement is requested by the recipient and reason for the restatement is to be disclosed in the notes to the financial statements.
When the submission is required, the annual audited financial statements package must include, at a minimum, the following:
Components of the annual audited financial statements
| For First Nations (F-0080) |
For tribal councils and First Nation political organizations (F-0080) |
For all other recipients (F-0190) |
|---|---|---|
| Auditor's letter to management | Auditor's letter to management | Auditor's letter to management |
| Auditor's report | Auditor's report | Auditor's report |
| Consolidated statement of financial position | Statement of financial position | Balance sheet |
| Consolidated statement of operations (including budget figures) | Statement of operations (including budget figures) | Income statement (including budget figures) |
| Consolidated statement of changes in net debt | Statement of changes in net debt | Statement of retained earnings |
| Consolidated statement of cash flows | Statement of cash flows | Statement of cash flows |
| Notes to financial statements | Notes to financial statements | Notes to financial statements |
The financial statements package is to be approved and signed by an authorized official.
7.2 Schedule of Revenue and Expenses (Annex A)
Please note: At the closing of the fiscal year, the Departments provide recipients with their Funding Confirmation and Payables at Year End (PAYE) Report. To assist with a timely and efficient departmental review, recipients are encouraged to utilize this report, along with their funding agreement, when preparing their Annex A submissions. If this report has not been received by April 30th, recipients shall contact their departmental responsible officer to obtain a copy. Recipients who have more than one funding agreement with the Departments will receive a separate report for each funding agreement.
It is suggested that a separate Annex A be submitted for each Functional Area identified in the report and the funding agreement. Each Annex A should present revenues and expenses broken down by funding approach (Set, Fixed, Flex, or Block) and by project(s), where applicable.
The Annex A:
- Are unaudited for the F-0080, F0081, F-0190 and F-0192 reporting packages; recipients may choose to prepare the Annexes themselves or have them prepared by their respective auditors.
- Must be audited for the F-0191 reporting package.
- Must be prepared on an accrual basis, recognizing revenues and funding earned during the reporting period and deducting expenses incurred. Revenues should be reported in the fiscal year in which the underlying transactions or events occur, in accordance with the revenue recognition principle.
- Must disclose current year's budgeted and actual amounts, as well as prior year's actual amounts.
- Must detail revenues from all sources including funds received from other government departments, private enterprises and other source(s).
- Must detail opening and closing balances of deferred/unexpended funding, where applicable.
- Must disclose corresponding expenses or transfers out in the year in which the goods and services are acquired and a liability is incurred.
- Must exclude non-monetary items such as amortization, bad debt, losses on asset dispositions, etc.
- May include any additional information relevant to the schedules/financial statements.
- Must be signed by an authorized official of the recipient as this signature will be verified by the Departments. If multiple Annexes are submitted, a signed cover page is acceptable.
7.3 Schedules of remuneration and expenses
7.3.1 Auditor's attestation
The schedules of remuneration and expenses must include, for each schedule described in this section, an audit or a review report, as prepared by the recipient's auditor.
7.3.2 Requirement for schedule of remuneration and expenses
- Chief and Councillors (Annex B): Outlines separately the remuneration and reimbursed expenses provided to the Chief and each Councillor (acting in their capacity as such and in any other capacity, including their personal capacity) by the First Nation and by any entity that, in accordance with Generally Accepted Accounting Principles, is required to be consolidated with the First Nation. Definitions of "remuneration" and "expenses" are provided in Annex B, which must not include information about individuals other than the Chief and Councillors.
- Unelected Senior Officials (Annex C): Outlines the remuneration and reimbursed expenses provided to the recipient's unelected senior officials such as directors, managers and other senior administrators.
Please note:
- Schedules of remuneration and expenses (Annex B and C) are separate from the audited financial statements.
- As information about identifiable individuals (personal information) will appear in these reports, the First Nation should provide advance notice to those individuals these documents will be published and may be disclosed to its members. Only personal information that is reasonably necessary to complete the Schedules of Remuneration should be included in these documents.
7.4 Schedule of Movable Asset Reserve (Annex D)
Recipients who received Health Program "block" funding (or a "transfer", "flexible" or "flexible transfer" funding through agreements dated prior to April 2012) shall provide a Schedule of movable asset reserve, accompanied by an auditor's audit or review report.
7.5 Auditors' recommendations letter to management (Auditor's Letter)
The CPA Handbook recommends auditors to present to the audit committee or a similar governing body, any shortcomings in internal controls identified as a result of the audit engagement. This communication is sometimes also referred to as either an "auditor's letter" or an "internal control letter". These letters and the recommendations contained therein, are valuable management tools which may assist the recipient in building and improving financial and administrative capacity.
The handbook also requires auditors to communicate, in writing and on a timely basis, significant deficiencies in internal controls identified during the audit, to those charged with governance. It is strongly recommended that the "auditor's letter" or "internal control letter" be included in the financial reporting package provided to the Department(s). However, submission of this letter becomes mandatory when the recipient is in default, as defined under the applicable default provisions of the funding agreement.
Annex A
| 20XX Budget | 20XX Actuals | 20XX (Prior year actuals) |
|
|---|---|---|---|
| Revenue (examples) | |||
| Indigenous Services Canada and/or Crown-Indigenous Relations and Northern Affairs Canada | |||
| Other revenue | |||
| Indigenous Services Canada and/or Crown-Indigenous Relations and Northern Affairs Canada - Trust fund interest revenue | |||
| Current year deferred revenue | |||
| Prior year unexpended funding (where applicable) | |||
| Total revenues | |||
| Expenses (examples) | |||
| Advertising | |||
| Audit fees | |||
| Bank charges | |||
| Emergency assistance | |||
| Honoraria | |||
| Insurance | |||
| Interest on long-term debt | |||
| Medical supplies | |||
| Medical transportation | |||
| Office supplies | |||
| Professional fees | |||
| Rent | |||
| Repairs and maintenance | |||
| Salaries and benefits | |||
| Security | |||
| Telephone | |||
| Tradition and culture | |||
| Travel | |||
| Total expenses | |||
| Less: Non-Cash Items Note 2 | |||
| Surplus (deficit) before transfers | |||
| Transfers from ISC/CIRNAC programs (please detail the program name)Note 3 | |||
| Transfer to ISC/CIRNAC programs (please detail the program name)Note 3 | |||
| Transfer between non-ISC/non-CIRNAC program(s)Note 4 | |||
| Surplus (deficit) | |||
| (Feel free to include at the bottom of the Annex, any additional relevant information or explanations) | |||
Annex B
Annex C
| Name of Individual (optional) |
Position title | Number of monthsNote 1 | Actual or approved salary range from / to |
Other remunerationNote 2 |
Expenses reimbursed as part of other remunerationNote 3 |
|---|---|---|---|---|---|
Annex D
| 20XX | 20XX (previous year) |
|
|---|---|---|
| Balance at beginning of year | ||
| Amount provided in agreement for movable asset reserve | ||
| Total | ||
| Revenues generated | ||
| Expenses (acquisitions and replacements) | ||
| Balance at end of year |