US Equivalent of Canadian GIFI?

[Brian Levy]

The advantage of using the GIFI codes as the basis for the Canadian chart of accounts is that if you can export the data from the accounting system into a file format that the Canadian T-2 software will recognize it make life easier.  A blank GIFI is dozens of pages ling and preparing a translation table is very time consuming.  In Canada, unlike the US, the Corporate tax system starts with Canadian GAAP as the basis and adjusts from there.  The US tax system does not rely on a GAAP based system and hence US companies need not have GAAP statements unless required for some other reason.  This allows companies to elect cash and modified accrual basis accounting where in Canada neither are allowed.  Even self-employed persons are taxed on accrual based accounting.

The US does not have a GIFI statement per see in th 1120 but uses the L, M-1, M-2 and M-3 in a similar manner as the GIFI and book to tax adjustment schedule in the T-2 Canadian corporate income tax return.  

The US e-systems usually use a translation table where you take an item from your trial balance and map it to a line in the 1120.  As the 1120 has relatively few lines, especially when compared to the GIFI, it is not too much of a problem especially if the companies chart of accounts has been logically established.  In Canada one needs to map to a specific GIFI account number and the list is VERY long.  

In providing advice, we must remember our experience in one tax jurisdiction may not be relevant in another.  

I found this out when I moved to Canada years ago and developed my cross-border US-Canada tax practice.


Don Quixote de la Mancha wrote:

>I'm setting up the GnuCash accounts for my new business, and would
>like to know if there are any kind of standard account numbers for use
>when filing United States and California taxes.
>
>Canada Revenue Agency publishes the General Index of Financial
>Information (GIFI), which has the official numeric designations for
>Canadian corporations to use on their financial statements:
>
>http://www.cra-arc.gc.ca/E/pub/tg/rc4088/README.html
>
>For example, GIFI item 1000 is Cash and deposits, 1002 is Deposits in
>Canadian banks in Canadian currency, and 1003 is Deposits in Canadian
>banks in foreign currency.
>
>If the US has any kind of equivalent to the GIFI codes, I think I
>should use them, but Google doesn't turn up anything.
>
>Thanks!
>
>Don Quixote
>  
>
I'm going to catch flak here -- but "Don", I'd say to discuss this with 
your accountant. The reason is .......

I am both the treasurer of a 501(c)3 and a very experienced (retired) 
senior systems analyst who designed/wrote a few hundred thousand lines 
of financial systems code in my day. Now one of the other board members 
is a accounting lawyer (and treasurer of a much larger 501(c)3) and he 
was taking the "rough" reports I produced, balance sheets, income 
statements, etc. and tuning out a finished product "financial report" in 
GAAP format the way normally done for non-profit reporting. So I asked 
him whether I should tackle creating custom reports from within GnuCash 
to do this for us and was told "Don't bother Mike. This is the everybody 
does it. The system produces the raw reports and the accountant imports 
that DATA into a report that they are creating using their favorite 
editor -- after all, there is a lot of "text" and there are the footnotes."

The point here is that attachment of codes and labels to be submitted to 
the government can come at a later stage, doesn't have to be part of the 
GnuCash account names. I believe that you will get the same advice form 
your accountant that I did.

Michael D Novack

-- 
There is no possibility of social justice on a dead planet except the equality of the grave.


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