Sunday News Roundup 23.04.09: CRA strike vote, carbon tax, software dealbook, and more Canadian accounting news
Wrapping up the odds and ends from the past week in Canadian accounting news
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TORONTO, April 9, 2023 – The top story of the past week in Canadian accounting is the growing threat of strike action this coming Friday at the Canada Revenue Agency. We have covered the negotiations for more than three months and reported on the potential impact of a strike today. It’s important to note that for many accountants and bookkeepers — particularly sole practitioners — tax season is their bread and butter.
As we reported back in 2019, the typical practitioner prepares more than 100 T1 returns and about 10 T2 returns, but that was five years ago. With the move to the Cloud and more accounting solutions (even for shoebox clients), that average has likely increased since the pandemic. A disruption at the CRA, though it may be limited in scope, will certainly impact tax preparers.
(Speaking of disruptions, the CRA reported Friday that some Canadians have not received their entitled tax credit payments due to technical issues affecting payouts of the GST/HST credit and the Ontario Trillium Benefit.) And now, on to the rest of the news from the past week in Canadian accounting.
Canadian Accountant: Punching above our weight
Five years ago, when we launched Canadian Accountant, we felt that the accounting profession sorely needed some independent reporting. At first we were a curiosity but our reputation for objective journalism has grown and we have been cited by everything from academic journals to textbooks to StatsCan and Macleans Magazine.
Now we can add the Supreme Court of Canada to our honours. While we were randomly searching the internet, we learned that we were cited in a case before the Supreme Court of Canada: Loblaw Financial Holdings (2021). It was a case that the Crown ultimately lost but we had a few things to say about it.
Ontario civil service fraud case ends in jail time
We had been following the fraud case of Sanjay Madan, an IT bureaucrat working for the Ontario government, since the beginnings of its criminal investigation. After pleading guilty to stealing a whopping $47.4 million from the provincial government — including $10.8 million in pandemic aid — Madan was sentenced this past week to 10 years in prison.
Any fraud case should be of interest to accounting professionals, of course, but this case raises a number of questions. How did Madan get away with it for so long? Who were his accomplices? Where is all the money? And why did internal controls fail? As part of her husband’s plea deal, Madan’s spouse will not be sentenced, but the family is likely to be sued in civil court.
PBO carbon tax report spins out of control
Yves Giroux, the parliamentary budget officer, released a new report recently on carbon pricing, and its messages were immediately spun by political parties. In Canada's budget watchdog troubled by spin around latest report on carbon pricing, Giroux expresses dismay about politicians selectively choosing which finding to trumpet to Canadians. But it seems that everytime Giroux publishes a report there is some kind of controversy involved. The PBO tried to explain that there is a cost to all climate action, including the cost of doing nothing, but that message didn’t make it through the noise.
Economist Stephen Gordon, who has more than 13-thousand followers on Twitter, said it best: “I mean, we econ profs on twitter are used to cleaning up after the mess govt comms people leave behind. But now we have to do the same for the PBO? It's just too depressing to think about … In other news, the PBO blew it.”
Accounting Dealbook: Caseware and Jazzit finally wed
This past week, two longstanding Canadian partners in the accounting solutions market, CaseWare and Jazzit, finally tied the knot and made it official. Caseware International announced the acquisition of Accountants Templates Inc., branded as Jazzit, which has provided templates and checklists to Caseware's Canadian customers for over 20 years.
Jazzit was founded by a couple of Calgary CPAs, Michael Chew and Lori McGurran, whose company was profiled in a 2018 article in Canadian Accountant. While some have been critical about the use of engagement templates, there is no denying their popularity among sole practitioners and firms, and the product offers uniquely Canadian solutions. The announcement follows another acquisition of a Calgary accounting staple, TaxCycle, by Xero in December 2021.
Quick Hits: Articles of Interest
Audit problems spread at Canadian accounting firms last year, industry regulator finds (Globe and Mail)
Court rules income earned from day trading in TFSA is taxable (Globe and Mail)
'I'm TaxGPT': Ottawa developer designs chatbot to help Canadians file their taxes for free (Financial Post)
Why single out the banks for a fleecing? (Globe and Mail)
More ways IFRS 17 can make for wonky reporting (Canadian Underwriter)
The First Home Savings Account is finally here. Here’s how it can save you thousands in taxes (Toronto Star)
EY given more time to resolve issues from exam cheating scandal (Financial Times)
By Canadian Accountant staff.