Quick Answer
Most private-sector Canadian not-for-profit organizations and registered charities use ASNPO — Accounting Standards for Not-for-Profit Organizations in Part III of the CPA Canada Handbook. For matters Part III does not address, an organization also applies the relevant Part II standards. Public-sector or government-controlled organizations may instead use public-sector standards. The applicable framework depends on the reporting entity, not its size alone.
Both ASNPO and ASPE live in the CPA Canada Handbook, and ASNPO incorporates ASPE by reference for many topics. But they’re applied to different organizations and have different scope.
ASNPO
ASNPO — Accounting Standards for Not-for-Profit Organizations — is in Part III of the CPA Canada Handbook. It generally applies to private-sector not-for-profit organizations such as:
- Registered charities
- Not-for-profit organizations under paragraph 149(1)(l) of the Income Tax Act
- Other organizations that meet the ASNPO definition of “not-for-profit”
Part III contains not-for-profit-specific standards, including guidance on contributions and financial statement presentation. For accounting matters Part III does not address, an organization applies the relevant Part II standard.
The NPO-specific sections handle the things ASPE alone can’t: how to recognize restricted contributions, how to handle endowments, what a not-for-profit’s financial statement presentation looks like.
ASPE
ASPE — Accounting Standards for Private Enterprises — is in Part II and is designed for private enterprises. A charity or NPO using Part II alone where Part III applies would omit the not-for-profit-specific standards needed for matters such as contribution recognition and presentation.
What goes wrong when the wrong framework is used
We have seen charities prepare financial statements that:
- Treat all donations as revenue in the period received (ASPE-like), with no distinction between restricted and unrestricted.
- Show a single revenue line and a single expenses line, with no fund segmentation.
- Make no separate disclosure for endowment principal vs investment income.
Depending on materiality and the facts, an external accountant may propose adjustments, request clearer presentation, or consider the effect on an assurance report. Funders and boards may also be unable to identify how much of a reported surplus is available to spend.
When ASNPO doesn’t apply
A small number of charity-adjacent organizations use other frameworks:
- Public-sector entities (some hospitals, some universities) follow PSAS — Public Sector Accounting Standards — where they meet the definition.
- Some healthcare organizations follow PSAS with NPO-specific guidance.
- Larger not-for-profits sometimes elect to follow IFRS, though this is rare.
For a typical private-sector Canadian registered charity or NPO, ASNPO is the right framework. If you are not certain which framework your charity has been following, that is itself worth a conversation with a CPA before next year-end.
See also
- Fund accounting for Canadian charities — what Part III requires the ledger to be able to represent.
- NPO bookkeeping for Canadian not-for-profits — how the framework applies to organizations exempt under paragraph 149(1)(l).
- How to choose accounting software for a Canadian charity
Related questions
Is ASNPO part of ASPE?
No, but they are connected. ASNPO is Part III of the CPA Canada Handbook and ASPE is Part II. Part III contains the not-for-profit-specific standards, and for accounting matters Part III does not address, an organization applies the relevant Part II standard.
Do small charities have to use ASNPO?
The applicable framework depends on the reporting entity, not its size alone. Most private-sector Canadian registered charities and not-for-profit organizations use ASNPO regardless of how small they are. Public-sector or government-controlled organizations may instead use public sector accounting standards.
What happens if a charity uses ASPE instead of ASNPO?
Applying Part II alone where Part III applies omits the not-for-profit-specific standards for matters such as contribution recognition and financial statement presentation. Depending on materiality and the facts, an external accountant may propose adjustments, request clearer presentation, or consider the effect on an assurance report.
When do public sector accounting standards apply instead?
Some hospitals and universities follow PSAS where they meet the definition of a public-sector entity, and some healthcare organizations follow PSAS with not-for-profit-specific guidance. A small number of larger not-for-profits elect IFRS, though this is rare.
Sources
Go deeper
Pillar guide
Fund Accounting for Canadian Charities: ASNPO Guide
Last Updated: July 2026
Sources reviewed: July 10, 2026
General information only. This page is not legal, tax, assurance, or professional advice for any specific organization. Confirm decisions with the CRA, your CPA, and legal counsel for your facts.