Description: In December the federal government brought in new regulations requiring the airlines to pay up to $1,000 in compensation to travelers hit by they canceled flights, other than for safety reasons of course. But customers are complaining that they haven’t been getting the refunds when they request them, and, further, they also haven’t been receiving explanations when they are turned down for a refund request. The Canadian Transportation Agency is responding to these complaints by saying it will look into the matter.
Date: February 14, 2020
1) Have you encountered this flight cancellation problem and been denied a refund?
2) The regulations came into place on December 15. Were you aware that they had been enacted?
3) Wiley’s Financial Accounting : Tools for Business Decision-Making tells us about liabilities for uncertain events in Chapter 10. Do you think that refunds for cancellations might be an area where an airline would need to record a liability?
Description: You don’t have to look too far in most cities and towns to see a boarded up shopping mall or other retail establishment. But while the traditional theory puts the blame on online shopping, a closer look at the data reveals three other forces have a bigger share of the blame. Big box retailers, a rise in the relative value of services, and the rise of income inequality have had more of an impact than the internet in terms of shuttering traditional retail establishments.
Date: February 14, 2020
1) Have you witnessed the decline of traditional bricks and mortar establishments in your university town?
2) Did this article surprise you? What can an article like this teach us about digging deeper for explanations when we see something happening in the world?
3) Wiley’s Managerial Accounting : Tools for Business Decision-Making provides us with a short vignette on Apple on page 373. How has Apple both positively and negatively impacted traditional shopping malls?
Description: The Coronavirus story is lingering on. One industry that seems to be suffering is tourism, with travel agents and tourism operators bracing for a decline in activity lingering into 2021. An executive at the Hilton hotel chain estimates the company will be affected somewhere between $25 and $50 million.
Date: February 16, 2020
1) Would the coronavirus influence your travel plans? Do you know anyone who has changed travel plans because of it?
2) If you were an accountant employed by a hotel chain like Hilton, how would you develop an estimate for lost revenue from a situation like this?
3) Wiley’s Managerial Accounting : Tools for Business Decision-Making tells us on page 16 that the Hilton hotel chain uses a certain managerial accounting device to evaluate employee performance. What is this tool? What are its components?
Description: In 2018 the Canadian government purchased the Kinder Morgan Trans Mountain Pipeline for $4.5 billion of our tax dollars. Around that time, the total estimated cost to complete the pipeline was $7.4 billion. Now though, it appears that the total costs for Canadians will be somewhere in the range of $17 billion. The federal Liberal party is defending the decision to buy the pipeline as a necessary one in order to get Canadian petroleum to market.
Date: February 7, 2020
1) Did you know that our government owned this pipeline? What’s your opinion of government ownership in this situation?
2) What do you think may have caused such an increase in the cost estimate of this project?
3) Page 521of Wiley’s Advanced Accounting shows a sample Consolidated Statement of Financial Position for a government entity. On which part of this statement do you think the pipeline should appear?
Description: Tech giant Google is expanding its operations in Canada, building 3 new facilities to accommodate 5,000 employees by 2022. Toronto, Montreal, and Kitchener-Waterloo will be the big beneficiaries of this move. Things have come a long way since the time when the company hired its first Canadian employee in 2001, opening an office of one in Toronto.
Date: February 6, 2020
1) Do you think you would be interested in working for Google? Why or why not?
2) The article notes that Google will fund $2.5 million in scholarships through the organization NPower Canada. See if you can track down information on these scholarships to learn if you might be eligible.
3) Wiley’s Financial Accounting : Tools for Business Decision-Making tells us on page 4 that the head of Google in Canada comes from a background of accounting studies. See if you can find out more details about Monique Leroux and her high-profile career. What lessons can you learn?
Description: Canada Goose, the high-end garment manufacturer, is predicting a decline in sales this year. The reason for this might surprise you a bit: it’s the impact of the coronavirus on sales in China. The outbreak of the illness has slowed both retail sales and web transactions.
Date: February 7, 2020
1) Do you or any of your classmates wear Canada Goose products? How do you rate them?
2) If you were a financial manager at Canada Goose, what might you suggest to help the company through this rough period?
3) On page 739 Wiley’s Financial Accounting: Tools for Business Decision-Making you can see some financial results for Columbia Sportswear Company, another manufacturer of high-end outerwear. Conduct a search to see if Columbia has been impacted by the coronavirus in any way similar to Canada Goose.
Description: Did you hear the the Canadian government has given $50 million to MasterCard, a company that made $16 billion last year? The government response seems to be that this $50 million will create jobs and help the middle class. Of course, this new government has appointed a cabinet post for a minister of the middle class. When first asked what the definition of the middle class was, the new minister, Mona Fortier, seemed to indicate it had something to do with affording to pay for your children to play hockey.
Date: February 2, 2020
1) Do you have your own definition of the middle class? How does it match up with that of your classmates?
2) What’s your opinion of this type of assistance to a company like MasterCard?
3) Government assistance to business is often provided by a so-called forgivable loan. How should a government account for these forgivable loans? (See page 533 of Wiley’s Advanced Accounting for an answer.)
Description: Have you ever spent too much time in a Tim Hortons drive thru, wondering why things take so long? It appears you may not be alone. Tim Hortons is looking at going back to basics of coffee and doughnuts, after many attempts at expanding its menu offerings. The plans also include improving the drive thru and the loyalty card program. Meanwhile, a number of franchisees upset by changes at the coffee chain are continuing on with their legal action.
Date: January 29, 2020
1) Are you a fan of Tim Hortons? If so, what do you like about the chain? What don’t you like?
2) Have you ever wondered if Tim Hortons’ expansion into so many lines of business was a good strategic move?
3) In Chapter 9 of Wiley’s Financial Accounting: Tools for Business Decision-Making, we read about accounting for trademarks. What would an accountant have to be aware of in recording the value of a trademark like Tim Hortons?
Description: During the recent federal election campaign, the Liberal party promised to increase the basic personal deduction on our income taxes, saying it would lift thousands of Canadians out of poverty. But, of course, somebody has to pay. And now the Parliamentary Budget Office is saying these deductions will cost the federal government $21 billion over the first five years.
Date: January 28, 2020; updated January 29
1) Do you think this change in the basic deduction will help you?
2) If you were advising the Minister of Finance, what would you recommend he do to fill this $21 billion gap?
3) In Wiley’s Advanced Accounting you can find a chapter dealing with public sector financial statements. What percentage of your own province’s revenue comes from personal income tax?
Description: Have you ever heard of the minimalist approach? More than that, have you heard about how it might maximize your financial future? If your basement and closets are full of stuff you don’t use, you’re probably not a minimalist. Organize your finances by setting up a budget and making your shopping trips more intentional. As far as your possessions go, columnist Lesley-Anne Scrogie says get rid of things you haven’t used in the last year.
Date: January 20, 2020
1) Do you think you could adopt the minimalist approach?
2) The article notes that accountants can fill an important role as trusted financial advisors. Do you think you would be interested in this aspect of an accounting career?
3) On page 445 of Wiley’s Managerial Accounting: Tools for Business Decision-Making, you can see an important inset box titled “Avoiding Personal Financial Disaster.” How do your own expenditure percentages fit with the Canadian averages presented in the text box?