Financial statements

You must attach financial statements when you file your T3010 annual information return even if your charity was not active during the fiscal year or had a zero balance. If the financial statements are missing, you have not filed a complete return.

Financial statements should include at least:

• a statement of assets and liabilities (balance sheet)

• a statement of revenue and expenditures (income statement)

• any prepared notes, such as:

  • accounting policies (for example, depreciation rates)

  • details of investments (for example, maturity dates and interest rates)

  • sources of revenue (for example, type of government grant)

  • transactions with non-arm's length parties

  • information about funds that a donor has directed you to hold for 10 years or more

  • future obligations

Your statements should accurately show your different sources of revenue and your expenditures for the fiscal year you are reporting.

Financial reporting can be done using either the: 

• Cash basis method
  • shows revenue or expenditures you actually received or spent during the fiscal year
     
• Accrual basis method
  • shows revenue you earned in the fiscal year, even if you received it after the end of the fiscal year
  • shows expenditures you incurred in the fiscal year, even if you paid them after the end of the fiscal year

You must clearly show the option you used (cash or accrual) on your financial statements and you must use that same method throughout your return.  

However, there is one exception. You have to use the cash method to report gifts you received.

Related links

• Sample financial statements