Posted by & filed under Financial Statement Analysis, Student life.

Description: This past week saw Canada’s Competition Tribunal holding hearings on Cineplex’s so-called “junk fees.” The Tribunal is looking at whether or not Cineplex can continue to charge movie-goers a $1.50 fee for purchasing a ticket online; or, will it declare that the fee meets the definition of a harmful business practice under the Competition Act? Since 2022, these junk or drip fees have generated $40 million in revenue for the movie firm.

Date:  February 29, 2024

Source:  globalnews.ca

 Link: https://globalnews.ca/news/10327620/cineplex-competition-tribunal-junk-fees-wrap-up/

Discussion points:

1) Have you noticed these junk fees on any of your movie ticket purchases? How about other students on your campus?

2) Were you aware that Canada has a Competition Bureau that can intervene on such matters?

3) Page 11-1 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses Cineplex’s statement of cash flows. What are the three key activities shown on this statement?

Posted by & filed under Accounting Careers, Financial Accounting.

Description: Salaried workers may be wondering if they worked for free on February 29, the leap day. Since those on an annual salary receive the same pay whether the year has 365 days or 366, workers like Rohith Krishnan feel they are missing out for showing up for the extra day. Others, like Annie Boilard, a human resources consultant, believe extra hours come with the territory for salaried staff, and that salary compensation generally reflects the employee’s overall contributions.

Date:  March 1, 2024

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/leap-day-working-for-free-1.7127313

Discussion points:

1) Had you ever thought of this leap year issue before? What do you think employers should do?

2) For graduating students on your campus, what percentage of them would you say are receiving an annual salary offer?

3) Pages 9-17 and 9-18 of Wiley’s Understanding Financial Accounting discusses the four journal entries required to record a company’s payroll costs. What are they?

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

Description: Online message board site Reddit, with its 70 million users, is planning to “go public” in an initial public offering (IPO). This is despite the fact that Reddit has been a consistent money loser since its launch in 2005, counting up losses of US $90.8 million in 2023 and US $158.6 the year before. In an interesting twist from a typical IPO where large, institutional investors rule the day, Reddit does intend to reserve some of the share issue for its loyal users.

Date:  February 23, 2024

Source:  ctvnews.ca

 Link: https://www.ctvnews.ca/business/reddit-hasn-t-turned-a-profit-in-nearly-20-years-but-it-just-filed-to-go-public-anyway-1.6781043

Discussion points:

1) How many of your classmates are Reddit users? What is the best thing about the platform?

2) How can a tech company that has never made a profit continue to survive for twenty years?

3) Page 11-9 of Wiley’s Understanding Financial Accounting discusses the subject of an IPO. What is the process it outlines for an initial public offering on a stock exchange?

Posted by & filed under Financial Accounting, Marketing & Strategy, Student life.

Description: Subway restaurants in Canada may have given a whole new meaning to the phrase “cut the mustard” as disappointed sandwich consumers are finding their favourite condiment is disappearing from the popular franchise. Dalhousie University’s Sylvain Charlebois notes that demand for the flavourful yellow topping has been declining while other sauces and marinades helped push overall condiment consumption up. Subway did not appear to respond directly to the CBC journalist’s inquiries, making it difficult to confirm aspects of this story. In a changing condiment landscape, it will be interesting to see if mustard disappears from Subway for good.

Date:  February 23, 2024

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/mustard-demand-canada-1.7123420

Discussion points:

1) Has anyone on your campus complained of this mustard crisis at Subway?

2) Do you think it would be a wise move to remove mustard from Subway restaurants? What would be some key factors to consider in such a decision?

3) Page 9-30 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses intangible assets with indefinite lives. What is the key factor mentioned in this section that determines whether a franchise has an indefinite life?

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

Description: Low-cost carrier Lynx Airlines announced it would be shutting down February 26. Lynx informed its passengers travelling on later dates that they should seek refunds through their credit card provider rather than from Lynx. The discount airline got off the ground in 2022, but it blames such forces as inflation, high fuel cost, exchange rates and airport fees for its financial problems.

Date:  February 22, 2024

Source:  cbc.ca

 Link: https://www.cbc.ca/news/canada/calgary/lynx-air-creditor-protection-airlines-canada-1.7123247

Discussion points:

1) Have you or any fellow students ever been left stranded by an airline shutdown? If so, what did you do?

2) If you were a senior financial officer, such as interim CFO Michael Woodward who is mentioned in the story, how would you explain the situation to your co-workers, your customers, and the media?

3) Secton 2.3 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses the conceptual framework for the preparation and presentation of financial statements. Which assumption mentioned in this section speaks to the current situation Lynx Air finds itself in?

Posted by & filed under Ethics, Financial Reporting and Analysis, Marketing & Strategy.

Description: Heroes to Zeroes – that’s the message of the sign carried by Gig Workers United’s Brice Sopher during a demonstration by Uber and Lyft drivers at Toronto’s Nathan Phillips Square, part of a coordinated Valentine’s Day effort in Canada, America, and the United Kingdom. The workers are looking for better wages and benefits following RideFairTO’s study indicating drivers were making an average of $6.37 per hour versus the Ontario’s $16.55 minimum wage requirement. Uber appeared unconcerned about the action, noting “these types of events have rarely had any impact on trips, prices or driver availability . . . because the vast majority of drivers are satisfied.”

Date:  February 15, 2024

Source:  thestar.com

 Link: https://www.thestar.com/news/gta/toronto-uber-lyft-workers-take-part-in-global-protest-against-low-wages-people-need-to/article_80cda166-cb57-11ee-bda2-a3b8f4d2cba1.html?source=newsletter&utm_email=760BE779956395955CFBBA5C497D22A3

Discussion points:

1) How many of you and your classmates are users of these gig services?

2) Do you think that this knowledge of the $6.37 average wage will impact your use of these services in the future?

3) Page 3-69 of Wiley’s Financial Accounting: Tools for Business Decision-Making has a short financial reporting case on Uber Technologies (see CT 3.3). Divide into small groups in your classroom to take on this case.

Posted by & filed under Accounting Careers.

Description: Interest was high in both the play on the field and in the advertisements between the action when the Super Bowl took place last Sunday. CNN rated the winners and losers among the commercials for the big game. With 30 seconds of commercial time costing advertisers $7 million – and additional millions for production costs and payments to big name celebrities – the corporations paying the bills must have hopes that the marketing efforts will produce big returns.

Date:  February 12, 2024

Source:  cnn.com

 Link: https://www.cnn.com/2024/02/11/entertainment/commercial-advertisement-super-bowl-dunkin/index.html

Discussion points:

1) Do you have a favourite commercial from this year’s Super Bowl?

2) If you were a senior financial advisor in one of the companies paying $ 7 million (plus production costs) for a 30-second ad, how would you measure the benefits associated with these costs?

3) Page 6-9 of Wiley’s Managerial Accounting: Tools for Business Decision-Making introduces the contribution margin technique. How might an accountant employ contribution margin in evaluating the break-even point for a company placing a Super Bowl ad?

Posted by & filed under Fraud, Internal control, Student life.

Description: Cyber thieves stole over 84,000 Scene+ points from Rosalind Ashe, $100 at a time. April Canavan of Vancouver found herself $1,000 short of PC Optimum points after she was targeted by fraudsters. These unfortunate Canadians are victims of data theft in action as criminals enter into individual accounts through “brute force” attacks or information made available through data breaches. One recommendation for us is to ask for two-step verification on your accounts.

Date:  February 17, 2024

Source:  cbc.ca

 Link: https://www.cbc.ca/radio/costofliving/loyalty-point-theft-1.7115362

Discussion points:

1) Have you or any of your classmates been troubled by a theft of your loyalty points?

2) Do you use two-factor identification where available? Why is it an effective control in protecting your points?

3) Pages 7-3 through 7-8 of Wiley’s Financial Accounting: Tools for Business Decision-Making contains a section on Control Activities businesses can employ. Which of these five would be most applicable in helping you safeguard your loyalty points assets?

Posted by & filed under Accounting Careers, Financial Accounting, Personal Tax.

Description: John Tavares, captain of the Toronto Maple Leafs, is suing the Canada Revenue Agency in an $8 million dispute regarding a reassessment of his 2018 income tax return. The essence of the dispute relates to the taxation rate on his $15.25 million signing bonus. Tavares and his advisors believe the bonus should be taxed at a lower rate of 15%, arguing that it falls under the inducements clause for artists, musicians, and athletes detailed in the Canada-US Tax Treaty. The CRA, for its part, is demanding $6.8 million in taxes and an additional $1.2 million in interest.

Date:  February 7, 2024

Source:  bnnbloomberg.ca

 Link: https://www.bnnbloomberg.ca/toronto-maple-leafs-captain-john-tavares-in-8m-tax-dispute-with-cra-1.2032484

Discussion points:

1) How do you feel about special tax-treaty provisions for athletes, artists, actors, and musicians?

2) Do you have interest in a career as a tax advisor?

3) Page 3-4 of Wiley’s Financial Accounting: Tools for Business Decision-Making speaks to the subject of NHL signing bonuses. What are the key factors to consider as to when the bonus would result in an accounting transaction?

Posted by & filed under Financial Accounting.

Description: The “Big Owe” is a nickname long associated with Montreal’s Olympic Stadium, given its history of cost overruns and other issues. The original retractable roof had been a source of problems, and the stadium has not been available for winter events for quite some time. But now, rather than pursue the option of a costly demolition, Caroline Proulx, Quebec’s Tourism Minister, announced a four-year construction project to replace the roof with a glass structure. The new roof will allow year-round stadium use, generating new revenues for the Olympic Park.

Date:  February 5, 2024

Source:  cbc.ca

 Link: https://www.cbc.ca/news/canada/montreal/quebec-to-spend-870m-on-a-new-roof-for-the-olympic-stadium-1.7104971

Discussion points:

1) How many of you and your classmates have been to an event at the Olympic Stadium?

2) What do you think about Concordia professor Moshe Lander’s opinion that the government should “put it out of its misery and knock it down?”

3) Page 8-8 of Wiley’s Understanding Financial Accounting has a section titled “How Do We Account for Costs Subsequent to Purchase?” Searching for “yes” answers to the approach outlined in this section, do you think the costs of the new roof should be capitalized or expensed?