Wiley Accounting Updates

Posted February 10th, 2020 by Brent White & filed under Accounting Careers.

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

Source: cbc.ca

Link: https://www.cbc.ca/news/business/canada-goose-1.5455981

Discussion points:

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.

Posted February 3rd, 2020 by Brent White & filed under Accounting Principles, Canadian Government.

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

Source: torontosun.com

Link: https://torontosun.com/opinion/columnists/lilley-to-trudeau-mastercards-ceo-is-the-middle-class

Discussion points:

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.)

Posted February 3rd, 2020 by Brent White & filed under Marketing & Strategy.

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

Source: financialpost.com

Link: https://business.financialpost.com/news/retail-marketing/double-double-and-doughnuts-tim-hortons-seeks-return-to-what-its-famous-for-amid-sales-slump

Discussion points:

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?

Posted February 3rd, 2020 by Brent White & filed under Personal Tax, Student life.

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

Source: cbc.ca

Link: https://www.cbc.ca/news/politics/pbo-basic-personal-income-amount-change-1.5443412

Discussion points:

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?

Posted January 27th, 2020 by Brent White & filed under Accounting Careers.

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

Source: thestar.com

Link: https://www.thestar.com/business/personal_finance/opinion/2020/01/20/how-minimalism-can-simplify-your-finances-and-help-you-grow-your-wealth.html

Discussion points:

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?

Posted January 27th, 2020 by Brent White & filed under Personal Tax.

Description: Billionaires and mere millionaires head for Davos this time of year for the World Economic Forum. This year though, some of those members of the wealthy elites are making the rather unusual request that their taxes be raised. An American group called Patriotic Millionaires is seeking a form of global changes to help shrink the gap between the super-rich and the rest of us. So far it appears that their fellow guests have not been rushing to join the movement.

Date: January 23, 2020

Source: cbc.ca

Link: https://www.cbc.ca/news/business/bank-canada-poloz-1.5436058

Discussion points:

1) Were you surprised by this story?

2) What do you think should be the highest marginal tax rate on high earners?

3) Wiley’s Advanced Accounting discusses the principles of preparing government financial statements. Where would personal income tax revenues show up in government financial statements?

Posted January 27th, 2020 by Brent White & filed under Uncategorized.

Description: Dieselgate, the emissions scandal associated with Volkwagen since 2015, hit Canadian news again this past week. A judge imposed $196.5 million in fines on the German car maker, punishing Volkswagen for importing cars that didn’t comply with Canadian emission regulations. This huge fine is the largest environmental fine ever imposed in Canada.

Date: January 22, 2020

Source: cbc.ca

Link: https://www.cbc.ca/news/business/volkswagen-pleads-guilty-emissions-cheating-canada-1.5436346

Discussion points:

1) Have you heard of Dieselgate? What do you think of this large fine?

2) Do you know anyone who owned a Volkswagen vehicle with these emission problems? How were they impacted?

3) In Wiley’s Auditing: A Practical Approach, we see how important it is for auditors to understand the organizations they are auditing in order to assess risk. If you were on the audit team of Volkswagen, how might the whole Dieselgate problem impact your assessment of risk?

Posted January 20th, 2020 by Brent White & filed under Accounting Principles.

Description: Running federal deficits in good times may hurt Canadians in the long run according to HEC Montreal’s Centre for Productivity and Prosperity. Our Canadian government ran deficits from 2015 through 2018, and this may have lead to economic growth. Now, with no recession in sight, the latest financial update from the government indicated that the current deficit would be in the range of $27 billion, $7 billion higher than that projected in the budget. As the authors of the study say regarding current economic conditions, “If these aren’t the conditions for achieving a balanced budget, what will it take?”

Date: January 15, 2020

Source: thestar.com

Link: xhttps://www.thestar.com/business/2020/01/15/recurring-federal-deficits-could-be-risky-for-future-generations-study-says.html?source=newsletter&utm_source=ts_nl&utm_medium=email&utm_email=760BE779956395955CFBBA5C497D22A3&utm_campaign=sbj_19813&utm_content=a06

Discussion points:

1) What is your opinion of the government deficit situation?

2) Where would the annual deficit show up on the Government of Canada financial statements?

3) On pages 381-2 of Wiley’s Financial Accounting: Tools for Business Decision-Making, we read about the principles of cash management. When our government is running a deficit, what do you think would be some of the challenges in managing cash flow?

Posted January 20th, 2020 by Brent White & filed under Managerial Accounting, Uncategorized.

Description: Statistics Canada tells us that in Toronto and other cities in southern Ontario, wages for men have either been flat – no increases – or on the way down for the 15 year period between 2000 and 2015. In contrast, wages for males elsewhere in Canada went up by 13% over the same period. According to economist Sheila Block “This quantifies what everyone felt was true.” The reduction in manufacturing jobs has been tough not just on the manufacturing workers themselves, but also on their surrounding communities.

Date: January 15, 2020

Source: thestar.com

Link: https://www.thestar.com/business/2020/01/15/men-living-in-toronto-havent-seen-their-wages-increase-since-2000-according-to-new-statcan-study.html?source=newsletter&utm_source=ts_nl&utm_medium=email&utm_email=760BE779956395955CFBBA5C497D22A3&utm_campaign=sbj_19813&utm_content=a02

Discussion points:

1) Do you know anyone impacted by this situation with manufacturing jobs?

2) One of the people quoted in the story puts the blame on poor government negotiation on trade deals, noting that Canada has slipped a long way from its old fourth-place standing in auto production. What do you think the government could do to secure better trade terms?

3) In Chapter 2 of Wiley’s Managerial Accounting: Tools for Business Decision-Making, is a thorough discussion of cost behaviour. Which of the various costs discussed in this chapter would be impacted by a freeze or a cut in wages over that 15 year period?

Posted January 20th, 2020 by Brent White & filed under Marketing & Strategy, Sustainable Development.

Description: BlackRock, the largest manager of financial assets in the world, is making an about face on climate change. In a letter to CEOs, BlackRock signaled that the economy is “on the edge of a fundamental reshaping of finance” due to the threat of climate change. BlackRock is looking at dispensing with coal-related investments and says it will work with the companies it invests in to ensure better environmental disclosures.

Date: January 14, 2020

Source: cbc.ca

Link: https://www.cbc.ca/news/business/blackrock-investment-climate-change-1.5426465

Discussion points:

1) Have you ever heard of BlackRock? If so, what do you know about the firm?

2) How do you think BlackRock’s change in strategy will influence behaviours in the marketplace?

3) In Chapter 1 of Wiley’s Auditing: A Practical Approach, you can learn about several different types of auditing. Which types of auditing could be employed to assist in efforts to disclose a company’s risk around climate change?