Posted by & filed under Accounting Principles, Canadian Economy.

Description: Canada’s inflation rate was down to 1.9% in December. One big factor appears to be a slow down in gasoline price increases. Another was a short price war on cellphone plans sparked by Shaw cutting consumer costs on some of its offerings. When other large carriers followed suit, consumers benefitted, as long as they didn’t mind standing in line for the new rates.

Date: January 26, 2018

Source: cbc.ca

Link: http://www.cbc.ca/news/business/inflation-rate-december-1.4505086

1) Did you get to take advantage of any of the reductions in cellphone plan rates?

2)  Check out the comparison of inventory costing methods in Illustration 6.6  of Wiley’s  Financial Accounting: Tools for Business Decision Making. Which inventory costing method gives the “best” figure for ending inventory when prices are rising?

3) Canada’s inflation rate is low. But countries can face situations where inflation rises dramaticaly. This is known as hyperinflation. Search for this term in Wiley’s  Advanced Accounting  where you can read about special provisions for handling this situation when translating foreign currency in preparing financial statements.

Posted by & filed under eCommerce, Managerial Accounting.

Description: With Bitcoin grabbing so many headlines lately with its dramatic rise in price, accompanied by a fall back towards $10,000 per unit, some are focusing attention on the costs of creating it. The so-called mining process that generates new bitcoin requires a shocking amount of computer power with some miners setting up server farms to earn the bitcoin rewards. The computing power in turn consumes large amounts of electricity with an estimate that the amount of electricity to generate one bitcoin is equivalent to what the average American home would consume in two years.

Date: January 26, 2018

Source: thestar.com

Link: https://www.thestar.com/business/tech_news/2018/01/26/bitcoins-staggering-energy-consumption-increases-along-with-prices.html

1) Have you ever attempted bitcoin mining?

2)  Were you surprised by the high energy cost of generating bitcoin?

3) Using the techniques from Wiley’s  Managerial Accounting: Tools fro Business Decision Making calculate the contribution margin per each unit of bitcoin generated at current prices.

Posted by & filed under Canadian governments, Contemporary Business Issues.

Description: Red tape continues to be a problem in Canadian jurisdictions. Perhaps the most humorous is a requirement in Quebec to post a notice to tell employees you are about to post a notice. This is among the finalists for Paperweight Award, an annual ‘competition’ sponsored by the Canadian Federation of Independent Businesses to highlight how government intervention in commerce can weigh down business activity. Other finalists include a two-page form  for a lemonade stand and the New Brunswick government’s pursuit of Gerard Comeau all the way to the Supreme Court of Canada to try and overturn previous court victories Comeau had won in his attempt to bring more than 12 beer across the Quebec border and back to his New Brunswick home.

Date: January 18, 2018

Source: bnn.ca

Link: https://www.bnn.ca/death-by-1-000-paper-cuts-the-silliest-examples-of-red-tape-affecting-canadian-businesses-in-2018-1.971522

1) Have you ever run into government red tape that you could nominate for the Paperweight Award?

2)  How could you calculate the cost of a regulation on a business?

3) In Section 1.7 of Wiley’s  Auditing: A Practical Approach you can read about various types of regulation over the auditing profession in Canada. What impact do these regulators have on the audit process and the cost of audit services?

Posted by & filed under Financial Accounting.

Description: Private profits and socialized losses. That’s how columnist Jen Gerson refers to the collapse of pension benefits for former Sears employees and the Ontario government’s response of a Pension Benefits Guarantee Fund. The Fund means the taxpayer steps in to guarantee a minimum level of pension benefits for underfunded pensions. Meanwhile, during better times, Sears executives received bonuses and shareholders collected dividends while Sears underfunded employee pension funds. As Gerson says, maybe it’s time for a law that forbids such payouts unless pensions are fully funded.

Date: January 14, 2018

Source: nationalpost.com

Link: http://nationalpost.com/news/canada/jen-gerson-sears-canadas-legacy-private-profits-and-socialized-losses

1) Have you or anyone one you know been caught in the pension problems at Sears? How would you deal with such an impact on your personal finances if this did happen to you?

2)  What  do you think about the possibility of a law that forbid executive bonuses or dividend payments to shareholders if pension funds were not fully funded?

3) Wiley’s Financial Accounting: Tools for Business Decision-Making describes how you would write-off an account from a company that could not pay its debts, such as a bankrupt company. How would you record this write-off in the general journal?

Posted by & filed under Canadian Economy, Student life.

Description: The major banks in Canada have raised their interest rates following the Bank of Canada’s third recent increase in its lending rate to 1.25%. With positive economic growth and healthy employment levels, the Bank of Canada believed it was a suitable time to raise rates. Lurking in the background, however, is the possibility of failure in the NAFTA trade talks. One economist, Avery Shenfeld, noted that the possibility of  NAFTA going south “hints that the view out the front window isn’t quite as sunny.”

Date: January 17, 2018

Source: CBC.ca

Link: http://www.cbc.ca/news/business/bank-of-canada-rate-decision-1.4490918

1) Using the calculator attached to the CBC article, or a spreadsheet template of your own, determine how a 0.25% rise in the rates might impact payments on your student loans.

2)  Have you been following any of the news around NAFTA? What do you think will happen?

3) What happens to bond prices when interest rates are rising?

Posted by & filed under Marketing & Strategy.

Description: Last week saw lots of buzz in Vegas as tech-fanciers and manufacturers hit town for the annual Consumer Electronics Show. Technology product editor Todd Haselton wrote that it appears to him that the focus of the show has been evolving. No longer do attendees see electronics – perhaps a new laptop or smartphone – that are just about to hit the market. Rather, he notes, the show has been shifting from an emphasis on stuff that people can buy and more towards ideas and “proof of concept.”

Date: January 12, 2018

Source: cnbc.com

Link: https://www.cnbc.com/2018/01/12/ces-2018-wrap-up-opinion-its-no-longer-about-the-consumer.html

1) Have you or any of your classmates ever attended the annual Consumer Electronics Show in Las Vegas? If so, describe the experience.

2)  From a strategic marketing point of view, why do you think we may have seen this change in emphasis at the Consumer Electronics Show?

3)  If you were an accountant working for one of the companies displaying goods at the Consumer Electronics Show, what account would you charge your organization’s expenses for the show to? For example, would it be marketing? Could it be considered as research?

Posted by & filed under Advanced Accounting, Canadian Economy.

Description: The deficit is still here. And Canada’s Finance Minister, Bill Morneau, says it will be for the foreseeable future. Morneau is projecting a deficit of slightly less than $20 billion for the Canadian government for the 2017-18 fiscal year. He is forecasting the deficit will continue to decline over the next several years, despite Canada’s demographic and economic growth challenges.

Date: January 12, 2018

Source: financialpost.com

Link: http://business.financialpost.com/pmn/business-pmn/morneau-still-committed-to-deficit-reduction-despite-slower-economy

1) What would you consider to be the “bottom line” on the Government of Canada’s financial statements? Hint: Consult Chapter 10 of Wiley’s Advanced Accounting.

2)  What do you think of this fiscal strategy of several years of planned deficits?

3)  What do you think of the strategy of building a $1.5 billion risk adjustment into the budget, allowing for such things as bad news from the NAFTA discussions?

Posted by & filed under Accounting Principles, Franchise.

Description: Well, apparently the Colonel will now take Bitcoin in Canada for KFC’s new Bitcoin Bucket. On January 11 KFC tweeted “Sure, we don’t know exactly what Bitcoins are, or how they work, but that shouldn’t come between you and some finger lickin’ good chicken.” It’s a rather amusing story to accompany all the media attention around  the recent bubble-like rise of the alternate currency Bitcoin.

Date: January 12, 2018

Source: fortune.com

Link: http://fortune.com/2018/01/12/kfc-bitcoin-bucket/

1) Have you ever purchased any Bitcoin? What did you use it for?

2)  What forces do you think are driving the recent rise in the value of Bitcoin?

3) Wiley’s Financial Accounting: Tools for Business Decision-Making has an interesting “Accounting Matters” discussion on page 367. Read the section and discuss with your classmates whether or not Bitcoin is cash.

Posted by & filed under Accounting Careers.

Description: Well, I got an interesting letter the other day. I once owned a Nissan, so when a letter came in from Nissan Canada Finance, I thought, “here we go again; they’re telling me what a great time it would be to see  my local Nissan dealer again and finance another car.” But when I opened the letter and started reading, I was surprised to see that Nissan Canada Finance suffered a data breach and that customers’ personal information could have been compromised. Ouch!

Date: January 5, 2018

Source: insurancebusinessmag.com

Link: https://www.insurancebusinessmag.com/ca/news/cyber/nissan-canada-finance-issues-data-breach-warning-88710.aspx

1) Over the last few months we have seen a number of prominent data breaches. Have you ever been notified that this has happened to you? What did you do?

2)  Chapter 11 of Wiley’s Core Concepts of Accounting Information Systems: Canadian Edition, discusses the ethical challenges companies face in handling data. How do you think you would respond if you were an executive at Nissan Canada Finance and you found out that your customers’ data may have been compromised?

3)  Have you ever considered a career in as accountant who helps organizations address IT security issues?

Posted by & filed under Canadian Economy, Student life.

Description: On January 1, 2018 Ontario raised the minimum wage to $14 per hour from the old floor of $11.60. CBC has found that at a number of locations in Ontario, Tim Horton’s franchise owners have responded to the increased costs by a variety of cost-cutting measures, including cutting paid coffee breaks for employees and cutting benefits. The cost-cutting did not appear to be restricted to Tim’s alone. For instance, one auto dealership reportedly is switching its casual drivers to the role of independent contractors who will now be compensated on a per trip basis versus through an hourly wage.

Date: January 5, 2018

Source: cbc.ca

Link: http://www.cbc.ca/news/business/tim-hortons-heirs-minimum-wage-wynne-ontario-1.4472878

Discussion Points:

1) Are you a student from Ontario? Will the increase in minimum wage impact you in your summer job?

2)  How do you think an increase in the minimum wage impacts an economy?

3)  Do you think there is a cost of negative publicity associated with a story like this? In other words, will some customers choose another coffee spot and avoid the Tim Horton’s restaurants that have cut breaks and benefits?