Description: Your federal government has decided to hand out approximately $12 million of our tax dollars for more efficient fridges: the problem Canadians are having with that is that the cheque is going to Loblaw, Canada’s largest grocery chain. Oh, did I mention Loblaw made about $800 million last year? To be fair, Loblaw did win a competitive bid process to come up with the cash, and improving the refrigeration will give the same carbon reduction as taking 50,000 cars off of the road. But for the average Canadian who may have just repaired their own fridge because they couldn’t afford a new one, it may seem like a bit too much.
Date: April 9, 2019
1) Were you aware of this part of the federal government’s carbon reduction plan?
2) Do you think this type of financial incentive should be given to large corporations to encourage sustainable development?
3) In Appendix B of Wiley’s Financial Accounting: Tools for Business Decision-Making you can see specimen financial statements for Loblaw’s major competitor Sobeys. If Sobeys were to receive a similar amount of aid for their fridges, what parts of the financial statements would change?
Description: A new report from the Organization for Economic Co-operation and Development (OECD) concludes the middle class is shrinking. Even worse for Canada, our middle class seems to be faring a bit worse than those in other nations studied. As noted by OECD’s chief of staff, Gabriela Ramos, “The middle class is at the core of a cohesive, thriving society. We need to address their concerns regarding living costs, fairness and uncertainty.”
Date: April 11, 2019
1)Were you aware of the declining middle class phenomenon noted in this story? As you look ahead to your graduation, does this story impact how you plan for the future?
2) What can our political and business leaders do to address the issue? Can the accounting profession play a role in accomplishing important changes here?
3) One of the things we read about in the article is the impact of education costs. In Wiley’s Financial Accounting: Tools for Business Decision-Making we see a reference to the University of Calgary Students’ Union. What type of action can our various student unions take to address these important education costs matters?
Description: You may find your voice doing funny things when you read this story: there’s a shortage of helium. This gas, that can change the pitch of your voice of course, is in short supply, and not for the first time. That bad news hits far more than those wanting inflated balloons. Helium gas, produced as part of the natural gas refining process, is used for many things, including semi-conductor manufacturing, scientific experiments, and for operating MRI machines.
Date: April 9, 2019
1) Have you heard about the helium crisis? Have you ever experienced it personally in any way? For instance, have any of the science labs at your school had shortages?
2) Do you think this type of shortage should be dealt with by the price incentives of supply and demand? Or, because of the medical and research benefits, do you think the government should intervene in the market in some way?
3) On pages 317-318 of Wiley’s Financial Accounting: Tools for Business Decision-Making you can read about the Lower of Cost and Net Realizable Value rule. Would you expect companies holding inventory of helium to have any write-downs in the near future?
Description: Approximately $15 million: that’s the amount of tax revenue that the Canada Revenue Agency (CRA) has generated so far following the 2015 release of the Panama Papers. So far, the CRA has looked at 525 of the 894 Canadians identified in the Panama Papers. In 2016 CRA took a hard stance towards these Canadians, stating that anyone identified in the Panama Papers would not be eligible for the voluntary disclosure program. Voluntary disclosure allows a taxpayer to approach CRA to negotiate a deal that can help avoid prosecution. While Canada has generated $15 million, Spain appears to be the big winner so far with $210 million, though Britain hopes to eventually cash in with over $300 million in tax.
Date: April 3, 2019
1) Have you ever heard of the Panama Papers prior to reading this story? What do you find interesting about it?
2) What do you think of the CRA decision to not allow voluntary disclosure for anyone identified in the Panama Papers?
3) Page 170 in Wiley’s Financial Accounting: Tools for Business Decision-Making tells us that the Canada Revenue Agency requires companies to file two types of returns. What are these two types and how frequently must they be filed? (Try guessing first; then turn to page 170 to check your score).
Description: It’s an old story for small town entrepreneurs. The new road takes your customers into the city for better prices, better selection and you’re facing a crisis. But Dave Callahan, owner of an independent station in St. George’s Newfoundland, is striking back. As the Fred Eaglesmith song puts it, “Then they built that overpass and they stay out on the highway.” Dave is hoping to prove the song wrong.
Date: April 6, 2019
1) What do you think of Dave’s new corporate strategy? Do you think it will work?
2) Can you think of some other strategies Dave or a similar small business owner can use to combat this type of situation?
3) Illustration 5-8 in Wiley’s Financial Accounting: Tools for Business Decision-Making explains the way to calculate a company’s gross profit margin. If Dave cuts his prices, what will happen to his gross profit margin?
Description: It’s not Toronto, or Vancouver. I’m afraid to tell you that those two don’t even make the top ten list. No, according to the Canadian Federation of Independent Business (CFIB), Canada’s most entrepreneurial city is Whitehorse, closely followed by Winkler, Manitoba. There appears to be no one single factor that trumps all others in making a community more entrepreneurial. The CFIB looked at 13 factors in its survey.
Date: April 3, 2019
1) Have you noticed if your hometown or university town is in the top ten? The bottom ten? Were you surprised?
2) Do you have any plans to be an entrepreneur after graduation? What do you see as some of the key factors to consider in locating your business?
3) Chapter 14 in Wiley’s Financial Accounting: Tools for Business Decision-Making shows a wide-variety of ratios that can be used to evaluate various aspects of a business’s performance. If you were an entrepreneur, what do you think would be three key ratios you would put on your “dashboard” to quickly gauge how your business was performing?
Description: Wow! Cheap fairs to Europe! Or maybe not. If you are one of those who has been stranded as of Thursday because of the collapse of Wow – a discount airline headquartered in Iceland – then maybe the bloom is off of the rose. Or maybe you’ve had a ticket on Wow for a European vacation post-graduation this summer. Well, not so wow for you. This seems to be another example of an airline that expanded too fast and too soon. leaving clients in the wake.
Date: March 27, 2019
1) How would feel if you were holding s Wow ticket? Have any of your classmates been caught in this mess?
2) If you were the chief financial officer at a discount airlines, what type of advice might you give management as they sought to expand?
3) Page 360 in Wiley’s Financial Accounting: Tools for Business Decision-Making talks about the subject of risk assessment as a component of a company’s internal control system. What do you think may have gone wrong with Wow’s risk assessment process?
Description: People have loved the hardware for years, with consumer after consumer gobbling up iPhones and iPads. This week, however, Apple’s latest launch had a definite services focus. A new Apple credit card, a streaming service and an Apple-news subscription that will give consumers access to 300 or so magazines, including big titles like National Geographic and Popular Science. The unique credit card will not have a number!
Date: March 25, 2019
1) Are you interested in checking out this new Apple streaming service?
2) Why do you think Apple has chosen this new service-oriented strategy?
3) Page 485 in Wiley’s Financial Accounting: Tools for Business Decision-Making tells us that at the time the text was written, Apple was the world’s most valuable brand. Is this still the case in 2019?
Description: At $300 million, restaurant chain McDonald’s is using a major tech acquisition of Dynamic Yield Ltd to jazz up its menu experience. CEO Steve Easterbrook has been promoting technology – like the new order kiosks – as a differentiator for the fast-food giant. By using Dynamic’s technology, McDonald’s will be able to update its drive through menus depending on factors like weather conditions. If the temperature is dropping, for instance, maybe the menu will promote a nice cup of hot coffee over soft drinks.
Date: March 26, 2019
1) Have you used the McDonald’s app or a kiosk to order your food?
2) Do you think that this acquisition will help boost revenue?
3) Illustration 12-1 in Wiley’s Financial Accounting: Tools for Business Decision-Making explains the difference between a strategic investment and a non-strategic investment. Using this chart as a guide, in which category would you place McDonald’s investment in Dynamic Yield?
Description: The Canadian Taxpayers Federation usually is not in the habit of praising a government for spending more money. This past week, however, the Federation did react positively to the news that the Office of the Auditor General of New Brunswick would be receiving an extra $1 million in its budget for 2019-20. This increase seems to put New Brunswick closer to the its Atlantic counterparts in terms of funding for the legislative audit office. By the way, if you are looking for work, a quick check of CareerBeacon shows the Office is already advertising for additional staff to put those new dollars to work. https://www.careerbeacon.com/en/job/1531232/office-of-the-auditor-general-bureau-du-verificateur-general/performance-financial-auditors/fredericton
Date: March 19, 2019
1) How would feel about an auditing career with an auditor general’s office? Have you considered that as an option?
2) If you were the auditor general, how would spend this extra $1 million?
3) Chapter 14 in Wiley’s Financial Accounting: Tools for Business Decision-Making talks about the big subject of performance measurement, but is largely directed towards for-profit enterprises. How could you measure the Office’s performance or success in spending an extra $1 million in the public sector?