Sunday News Roundup 24.03.03 Mulroney legacy, PwC sole source, RPA rising, and more Canadian accounting news

Wrapping up the odds and ends from the past week in Canadian accounting news

Mar 4, 2024 Author: Canadian Accountant

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TORONTO, March 3, 2024 – Former Canadian prime minister Brian Mulroney died this past Thursday at his home in Palm Beach, Florida. A veritable ocean of ink has been spilled on Mulroney’s legacy — including a raft of hagiography in the National Post and Globe and Mail — but precious little critical analysis of the former prime minister’s fiscal policies. So let’s touch on a few of them from the perspective of Canadian Accountant.

Let’s start with the GST. How ironic that a conservative would be responsible for the most impactful tax imposed on Canadians in modern history. Typically, the accounting community opposes all manner of taxation, though there is a libertarian wing that fervently believes in abolishing all income tax and imposing only consumption taxes. (The left wing holds that consumption taxes punish the poor most of all.)

Federal debt more than doubled under Mulroney and the GST did not reduce the deficit (it took the Liberals under Jean Chretien to do that). Very few recall that the GST was actually part of a tax reform package meant to mirror tax reform in the United States. Part of the plan was to eliminate income tax on the poor and lower the taxes of the wealthy. If you want to read more, especially from an American perspective, we recommend this declassified document from none other than the US Central Intelligence Agency (that’s right, the CIA).

Mulroney’s legacy on free trade is even more complicated. One might argue that, as the first among many neo-liberal trade policies to come, it set the stage for the hollowing out of the manufacturing sector, leading to widespread job losses among working-class Canadians, and the rise of the populist, protectionist policies of Donald Trump. And, as Thomas Klassen argues, Mulroney did more than any prime minister to tie Canadian fortunes to the whims of the United States, for better and for worse.

Of course, Mulroney’s legacy includes so much more, and all it takes is a few words to bring back memories: acid rain, apartheid, privatization, Oka, Airbus, and of course Meech Lake. For the most clear-eyed appraisal, we recommend going outside Canada for this obituary in The Sunday Times, about the “divisive” Mulroney: “Brian Mulroney achieved the rare distinction of being the most popular prime minister in Canadian history — and the least popular.”

And now, on to the rest of the news from the past week in Canadian accounting.

PwC Canada scores big contract with the Ford government

We already know that digital technology helped to propel Deloitte Canada to the top of the Big Four. Turns out PwC Canada has also got skin in the game, as CityNews broke the story that the Ford government handed PwC a sole source contract to create a new digital online tribunal system at the Ontario Landlord Tenant Board, the costs of which have soared to $26 million.

Great for PwC Canada. Perhaps not so great for taxpayers, as there was “no competition, no transparency” in the process, according to the provincial leader of the NDP. According to CityNews, “ministry and tribunals staff have been unhappy with the work provided by PwC.”

2023 was a horrible year for PwC, what with the exam cheating settlement with CPA Ontario, and the bad press over its layoffs and severance packages. Twenty-six million should help cushion the blow.

Is the RPA designation on the rise?

In case you missed it, there was an interesting article in Village Media, a sponsored content piece written by Green & Company Professional Accountants, called “The evolution of the accounting industry in Cambridge and beyond: The rise of the RPA.” The article highlights the emergence of three Registered Professional Accountant accounting firms in the Cambridge, Ontario area. Then it delves quite deeply into the history of the CPA designation in Canada.

Whomever wrote the piece knows quite a lot about the profession. It paints with very broad strokes the differences between the legacy designations and recalls the failure of the ACAF post-unification. It also hints at the market vulnerabilities of the CPA profession, particularly as it relates to the old CGA program, which was popular with two distinct groups — aspiring accountants in the college system, many of whom were immigrants or came from lower-income backgrounds, and adults who choose a new career path.

There’s a fair amount of discontent being expressed right now in the profession, over high member fees, professional development rules, and the future of the profession in general. Is the RPA designation on the rise? Stranger things have happened in Canadian accounting.

Life in the tax lane in March 2024

The March 2024 episode of Video Tax News is now online. Hugh Neilson, Caitlin Butler and Joseph Devany host the monthly segment. This month’s episode focuses mostly on tax season and some of the more pressing issues facing practitioners, such as new rules and reporting policies from the CRA, multi-factor authentication, and more. Check it out.

Software News

Sage announced the launch of a new AI-powered productivity assistant called Sage Copilot this past week as well as a collaboration agreement with AWS to enable AI-powered solutions for SMBs. Small businesses can already access Sage Intacct in AWS Marketplace. Sage Earth will now be available as well in AWS Marketplace.

“With this collaboration, Sage expands its relationship with AWS, enabling SMBs to successfully navigate the complexities of modern finance and address environmental responsibilities with cutting-edge solutions.”