Friday News Roundup 20.10.30: Medtech CPA, NB builder suspension, Fiera Foods and more

TORONTO, Oct. 30, 2020 – With just days to go before the US presidential election, pundits are beginning to weigh in on what a Biden victory might mean for the Canadian economy. With so much anticipation in the air, it was easy to miss the odds and ends from this week’s news in the world of Canadian accounting: 

CPA retools medtech company to create pandemic PPE

Early in the week, the Postmedia Network published a profile of Lesley Gouldie, CPA, CMA, the chief executive of Toronto-based medtech company Thornhill Medical. Gouldie explains in quite some detail how she pivoted the company towards manufacturing manufacturing personal protective equipment (PPE) supplies and ventilators during the pandemic. It’s an interesting look at the world of government procurement and supply chain management in the medtech sector. 

North Bay CPA, CA suspended by CPA Ontario

North Bay builder Renzo Silveri, CPA, CA is facing suspension for seven months by CPA Ontario. As reported by BayToday.ca, the lawyer for CPA Ontario labelled the accountant’s misconduct both serious and severe. Silveri admitted that he was in “technical breach of certain of my association’s rules of conduct” but called the ruling a vindication and evidence of “substantial” overreach on the part of his provincial Association. Silveri still faces criminal charges of fraud, theft and breach of trust. (At press time, CPA Ontario has published the signed allegations but not the decision statement of the hearing.)

Allan Lanthier on CEWS

Former Big Four partner, now retired, Allan Lanthier has gained a reputation as a balanced voice on taxation and fiscal issues. This week he had an op-ed in the Financial Post on CEWS: Help for furloughed workers, good; help for active workers, bad (well, "not a very sensible idea"). 

UK private equity buys stake in CaseWare International

Hg Capital, a pivate equity firm based in the UK, announced this week that it has made a “strategic investment” in Canadian audit software maker CaseWare. While terms of the investment were not disclosed, Reuters in the UK reported that HgCapital Trust plc will invest approximately GBP38 million in CaseWare, with other institutional clients of Hg investing alongside HGT through the Hg Genesis 8 Fund. 

According to a press release, “Hg’s investment and knowledge in global financial software businesses will help to support the company, particularly in accelerating the growth of CaseWare Cloud, which is already supported by more than a million audit engagements.” 

Industrial Bakery wins appeal of $25m in business tax deductions

(Editor's Note: Item updated 201104).  On October 28th, The Toronto Star reported the CRA "conceded to an appeal" this week of business expense deductions claimed on temporary labour. The CRA had claimed the temporary employment agencies supplying workers to Fiera Foods had “no office locations, management nor administrative personnel.” The Star reported that "tax authorities reached a settlement allowing Fiera to claim $20 million in deductions the CRA previously said were false." (Canadian Accountant originally repeated the Toronto Star report that $20m of the $25m had been allowed upon appeal.)

However, in a statement provided to Canadian Accountant, Fiera Foods' General Counsel, David Gelbloom, wrote "... the Minister and Fiera Foods consented to a judgment whereby Fiera Foods’ entire appeal was allowed. Fiera will be entitled to claim all of the approximately $25 million of deductions that were previously disallowed by the Minister related to our labour suppliers. Fiera Foods’ position, which consent to judgment confirmed, has been that the payments to the agencies were for services actually rendered, in compliance with the law. Fiera maintained proper books and records and it did not receive any improper benefit with respect to payments made to its labour suppliers."

The Toronto Star later updated the story, featuring comments from David J. Rotfleisch of Rotfleisch & Samulovitch P.C., who writes regularly for Canadian Accountant, on CRA scrutiny of temporary worker employment agencies. As reported by Canadian Accountant, the owner of a temporary employment agency in Toronto was recently sentenced to jail, having filed false tax deductions. “Since the CRA is on a mission to tackle potential shams in the context of staffing agencies, it is highly recommended for business owners working with Employment Agencies to seek professional tax advice.”

By Canadian Accountant staff.