Posted by & filed under Accounting Careers, Financial Reporting and Analysis.

Description: With word this week that Netflix reported its first drop in subscribers since 2011, and with streaming service CNN+ shutting down only one month after launch, https://www.cbc.ca/news/business/cnn-streaming-1.6426163, it’s no wonder some are speculating about challenges ahead for streaming services. Rising inflationary pressures may be part of the reason for Netflix’s declines, as the video giant loses some budget conscious subscribers. Netflix is looking at a number of means to generate additional revenues by offering cheaper tiers of membership and addressing the sharing of passwords.

Date: April 21, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/future-of-streaming-1.6426016

Discussion points:

1) What percentage of your classmates are regular Netflix users? Have any of them dropped Netflix in recent months?

2) If you were an accounting official at Netflix, what recommendations would you provide for dealing with the problem of password sharing?

3) Page 13-1 of Wiley’s Financial Accounting: Tools for Business Decision-Making mentions Netflix in a the chapter-opening vignette discussing the importance of the statement of cash flows. Do a bit of research in your class to see if you can determine how the drop in the number of subscribers may have impacted the statement of cash flows at Netflix.

Posted by & filed under Accounting Careers, Data security.

Description: After several days of delayed flights and upset passengers, Sunwing announced Thursday that it hoped to return to “close to normal operations” sometime on the weekend. A data breach at Airline Choice, the third-party supplier of Sunwing’s passenger system, caused cancellations and extensive delays as staff had to use manual processes to handle clients. To help ease the backlog, Sunwing has sub-contracted with other carriers, like Air Transat and WestJet.

Date: April 21, 2022

Source:  globalnews.ca

 Link: https://globalnews.ca/news/8775824/sunwing-delays-continue/

Discussion points:

1) Have you or your classmates ever used Sunwing for a vacation trip? How was your experience?

2) If you were a senior financial officer with Sunwing, what approaches would you recommend to win back the confidence of the traveling public?

3) Starting on page 7-8 in Wiley’s Managerial Accounting: Tools for Business Decision-Making we see a section dealing with a key decision of management, the “Make or Buy” decision. In a sense, Sunwing management has chosen a buy approach by contracting out its passenger handling systems to Airline Choice. How does this situation at Sunwing raise additional points to be considered among the strengths and weaknesses of contracting out?

Posted by & filed under Auditing, Sustainable Development.

Description: McDonalds Canada is facing criticism for its reluctance to accept reusable coffee mugs at its restaurants; all of its restaurants, that is, except for those in Vancouver. Like many chains, McDonalds started to refuse reusable coffee mugs early in the SARS-CoV-2 pandemic. But competitors such as Tim Hortons and Starbucks have reversed this policy recently. Though disposable coffee cups and plastic lids are not the most extreme environmental issue humanity must deal with, they are very difficult to recycle, and remain an eyesore on beaches, waterways, and roads. Friday, April 22, was Earth Day, so it was perhaps symbolic that CBC chose to run this story on that day.

Date: April 22, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/mcdonalds-vancouver-reusable-mugs-1.6426303

Discussion points:

1) Do you use a refillable coffee mug? How about your classmates?

2) Did your university take any specific action to celebrate Earth Day?

3) In Chapter 1 of Wiley’s Auditing: A Practical Approach we see several types of auditing (or assurance) engagements discussed. If a restaurant chain wanted to have some form of assurance provided on its efforts for waste reduction and recycling, what type of engagement would you propose?

Posted by & filed under Corporate Governance, Corporate Restructuring.

Description: Elon Musk, the wealthiest man in the world, wants to buy his favourite social media company, Twitter. Musk already owns 9.1 percent of Twitter, and his “best and final” offer values the company at $43 billion, considerably higher than its current market capitalization. Corporate governance experts have mused that Musk may encounter obstacles as he has not yet lined up the financing to turn Twitter back into a private corporation.

Date: April 16, 2022

Source:  theverge.com

 Link: https://www.theverge.com/23026874/elon-musk-twitter-buyout-news-updates

Discussion points:

1) Are you a regular Twitter user? How about your classmates?

2) Do you think Musk will be successful in his bid for Twitter?

3) On page 1-8 in Wiley’s Financial Accounting: Tools for Business Decision-Making we see a discussion of the choice that a private corporation faces in choosing an acceptable accounting framework. What are the two broad frameworks Canadian private companies can choose from and what are some of the strengths and weaknesses of each choice?

Posted by & filed under Auditing, Canadian Economy.

Description: CBC columnist Don Pitts offered an encouraging view this week for this time of rising interest rates, inflation pressures, war in Ukraine, and SARS-CoV-2 news. Pitts points out the importance of adopting historical perspective on the economy issue, quoting University of Toronto professor emeritus Jon Cohen who says “We’re the richest anybody’s been in the history of the universe.” Paul Krugman, a past winner of the Nobel Prize in economics, stated in a recent podcast that “People’s perception of the economy does seem to be way out of line with how bad things really are.”

Date: April 14, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/economic-health-column-don-pittis-1.6418102

Discussion points:

1) How have you and your university classmates been feeling about the economy?

2) What do you think about Paul Krugman’s assertion that the sense of doom is “a media failure?”

3) Professional Application Question 3.3 on page 3-28 in Wiley’s Auditing: A Practical Approach deals with how an audit team must consider the impact of the economy on the auditee, Scooter Limited, in order to properly plan for the audit of this importer of scooters and motorcycles. How might your response to this question change if you substituted current economic trends for those spoken of in PA 3.3?

Posted by & filed under Managerial Accounting, Marketing & Strategy.

Description: Etsy, the well known marketing site for vendors of various handmade and artistic items, is facing a one-week boycott from some of its suppliers. The boycotts are fueled by vendors who are upset that Etsy has raised its commission from 5% to 6.5%. Etsy counters that the additional funds will allow it to provide improved marketing and customer support. Further, Etsy does charge less than Amazon.

Date: April 11, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/etsy-fee-hike-boycott-1.6414283

Discussion points:

1) Have you ever purchased anything through Etsy? Have you or any of your classmates sold merchandise via Etsy?

2) How effective do you think the boycott will be?

3) On page 3-7 in Wiley’s Managerial Accounting: Tools for Business Decision-Making we are introduced to the concept of manufacturing overhead costs. What might be some overheads that a crafts-person or artisan selling through Etsy would have?

Posted by & filed under Financial Reporting and Analysis, Student life.

Description: Quick Pick is a bargain hunter’s delight with two locations in metro Ottawa. Quick Pick stocks items returned to online retailers like Amazon, creating value by providing a convenient way to deal with this inventory. New stock arrives every Friday, with all items starting at $25.99. Prices decline daily throughout the week, and, by Wednesday, everything is down to $2.99, before dropping as low as $0.99 on Thursday. Anything left after that is donated or thrown out, to get ready for Friday when it starts all over again.

Date: April 7, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/canada/ottawa/quick-pick-store-a-treasure-hunt-for-shoppers-1.6410353

Discussion points:

1) Do you have a favourite place in your university town where you can hunt for bargains? What’s the best bargain you’ve picked up?

2) The article mentions that online shopping increased by a factor of 4 during the pandemic. How does this number stack up with your own experience and that of your classmates?

3) On page 6-20 in Wiley’s Financial Accounting: Tools for Business Decision-Making we learn about the presentation of inventory on the balance sheet, including the concept of lower of cost and net realizable value. How might this principle be applied to an operation like Quick Pick?

Posted by & filed under Uncategorized.

Description: As a Toronto Star opinion piece stated this past week, “A living wage is not the same as a minimum wage.” The current minimum wage in Ontario is $15 per hour, but the Ontario Living Wage Network calculates that someone living in Toronto requires $22.08 per hour in order to get by. Financial problems from causes like this can lead to food insecurity, health problems, depression, and other issues.

Date: April 4, 2022

Source:  thestar.com

 Link: https://www.thestar.com/opinion/contributors/2022/04/04/it-is-time-for-a-living-wage-that-improves-social-connectedness-for-all-canadians.html?source=newsletter&utm_content=a04&utm_source=ts_nl&utm_medium=email&utm_email=760BE779956395955CFBBA5C497D22A3&utm_campaign=sbj_116257

Discussion points:

1) Have you ever encountered food insecurity during your time at university? Does your campus offer any programs to help students deal with this issue?

2) What is your perspective on this issue? Should a living wage become the legislated minimum wage?

3) Starting on page 9-17 in Wiley’s Understanding Financial Accounting we see a section “How Are Payroll Costs Accounted For?” What are the four basic journal entries that an employer makes to account for paying employee wages?

Posted by & filed under Canadian Government, Taxation.

Description: The latest federal government budget has announced a new 15% tax on bank profits over $1 billion. The way the government sees it, banks have done exceptionally well during the pandemic, a time when various federal programs assisted the economy. This special Canada Recovery Dividend could raise approximately $4 billion in government revenue, and it has drawn the ire of Brian Porter, the CEO of Scotiabank, who feels the move broadcasts the “wrong message to the global investment community.”

Date: April 7, 2022

Source:  thestar.com

 Link: https://www.cbc.ca/news/business/canada-budget-2022-bank-tax-1.6412530

Discussion points:

1) Have you or your classmates discussed any aspects of the latest federal budget? What stood out?

2) Do you support this special taxation initiative on banks and insurance companies? Why or why not?

3) On page 12-1 in Wiley’s Financial Accounting: Tools for Business Decision-Making we see a chapter-opening vignette on Scotiabank, also known as the Bank of Nova Scotia. Do a search for the Bank of Nova Scotia’s 2021 financial statements. Did Scotiabank make over the $1 billion figure mentioned in the budget?

Posted by & filed under Managerial Accounting, Student life.

Description: News came this past week that Canadians may be getting a bit of relief on rising food prices, at least where the cost of beef is concerned. Four meat packers, which together control 85% of Canada’s beef market, face a class-action lawsuit alleging that “the price of beef was fixed at an elevated, anticompetitive level.” Consumers may be somewhat cheered by the fact that in the United States in February a major packer paid out US$52.5 million regarding a price-fixing action, without admitting any liability.

Date:  March 30, 2022

Source:  lethbridgeherald.com

 Link: https://lethbridgeherald.com/business/2022/03/30/canadian-beef-consumers-could-get-a-break-as-price-fixing-class-action-lawsuit-filed/

Discussion points:

1) Are you a beef eater? What have you noticed about beef prices in your university town?

2) What sort of changes can you recommend to help deal with the impact of rising beef prices?

3) Page 8-2 in Wiley’s Managerial Accounting: Tools for Business Decision-Making provides a feature story on the cost allocation methods of Maple Leaf Foods, a major producer of packaged meats. What costing method does Maple Leaf Foods use to come up with a value for inventory on its financial statements?