Suncor Keeping Petro-Canada

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

Description: After shopping around for potential buyers, Suncor has decided to keep, rather than sell, fuel retailer Petro-Canada. Suncor had been seeking a cash purchase price in the range of $3.8 billion to $5.7 billion. Though Petro-Canada has the largest market share in its class in Canada, no buyer was interested in paying the price.

Date: November 29, 2022

Source:  globalnews.ca

 Link: https://globalnews.ca/news/9311689/suncor-energy-keep-petro-canada-retail/

Discussion points:

1) Which retail gas supplier seems to be the market leader in your university town?

2) Why do you think Suncor was unable to find a buyer?

3) On page 9-47 of Wiley’s Financial Accounting: Tools for Business Decision-Making we see problem E9.13 in which we are asked to determine which company is Suncor by analyzing the three ratios provided. Which one of the two companies do you think is Suncor?

Financial Literacy

Posted by & filed under Student life.

Description: How financial literate do you feel you are? November was financial literacy month in Canada and some high schools in Canada are adding this important life-skill area to the curriculum. With the economic pressures facing Canadians, and the clear correlation between financial health and mental health, some observers are calling for mandatory financial literacy courses in our high schools.

Date: November 30, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/financial-literacy-high-school-1.6668510

Discussion points:

1) How financially literate are you and your classmates?

2) Do you believe financial literacy should be a mandatory subject for high school students?

3) The inset box “How Sharp Are Your Decision-Making Skills?” on page 1-17 of Wiley’s Managerial Accounting : Tools for Business Decision-Making deals with the importance financial information in making decisions. What type of information do you consider in evaluating your choices in post-secondary education?

Living Wage at Bike Shop

Posted by & filed under Accounting Careers, Managerial Accounting, Student life.

Description: Cyclesmith, a Halifax bike shop, has been paying all of its 31 full-time employees a “living wage” of at least $23.50 an hour. Andrew Feenstra, the owner of the business, implemented this policy in September 2021, and he has noted its positive impact on employees who no longer have to live paycheque to paycheque. The additional cost of about $250,000 per year is worth it according to Feenstra as it helps with recruitment and retention.

Date: November 24, 2022

Source:  globalnews.ca

 Link: https://globalnews.ca/news/9303216/ns-bike-shop-living-wage/

Discussion points:

1) Would a living wage help you in your studies, similar to the story of Kieran Sharpe of Cyclesmith?

2) What do you think are some of the benefits and costs of paying employees a living wage?

3) Chapter 2 of Wiley’s Managerial Accounting: Tools for Business Decision-Making discusses the concept of direct and indirect labour. If you were an accountant at Cyclesmith, how might you make a distinction between costs of direct labour and indirect labour?

Six Unions; Only One Contract

Posted by & filed under Financial Accounting, Student life.

Description: Workers at six Starbucks locations in Alberta and British Columbia have formed unions. But so far, only in one store in Victoria has the new union actually reached a collective agreement with management. Until that first contract is in place, union members do not pay dues. It will be interesting to watch ongoing developments around the unionization of service workers in the aftermath of the pandemic.

Date: November 23, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/business/starbucks-union-canada-1.6661667

Discussion points:

1) Have you ever worked at a Starbucks? Was there interest in unionizing?

2) Why do you think it has been difficult for unions to organize in this restaurant sector?

3) In chapter 10 of Wiley’s Financial Accounting: Tools for Business Decision-Making we learn about accounting for various payroll deductions. How would union dues deducted from employees be accounted for by an employer?

Questionable Conduct at Laurentian

Posted by & filed under Auditing, Student life.

Description: In a special report on the Laurentian University financial crisis, Ontario Auditor General Bonnie Lysyk showed that senior management at the school erred by declining government assistance and heading straight to bankruptcy. Lysyk found that the Laurentian senior management and board of governors relied on external advisors in opting for the bankruptcy route, rather than pursuing financial support from the government and working with its labour unions to resolve difficulties. These various advisors have been paid roughly $30 million. The auditor general summarized things nicely in her press release statement that “one has to question whether paying more than $30-million and counting for external legal and financial advisers would not have been better spent on educating students.”

https://auditor.on.ca/en/content/news/specials_newsreleases/newsrelease_LaurentianU_SR_en.pdf

Date: November 17, 2022

Source:  yahoo.com

 Link: https://ca.news.yahoo.com/bad-decisions-laurentian-university-led-171453338.html

Discussion points:

1) Are you a Laurentian student or do you know anyone attending or working at Laurentian?

2) Do you know anything about the financial health of your university? How understandable are its financial statements?

3) Section 14-10 of Wiley’s Auditing: A Practical Approach discusses assurance engagements other than financial statement attest audits. What type of engagement do you think Bonnie Lysyk’s report on Laurentian University would be categorized as?

Swift Rebuke

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

Description: Taylor Swift called it “excruciating.” That’s her take on the fiasco that saw frustrated fans struggling to secure tickets for her upcoming tour after waiting it out for hours. Swift and others see this as a signal that Ticketmaster – and its parent company Live Nation – are broken. Calls are emerging to investigate the domination of ticket sales by the Live Nation/Ticketmaster combo.

Date: November 17&18, 2022

Source:  msn.com; nbc.com

 Link: https://www.msn.com/en-us/travel/news/i-knew-you-were-trouble-the-taylor-swift-ticket-fiasco-is-a-sign-to-fix-ticketmaster/ar-AA14h03j

https://www.nbcnews.com/news/us-news/tennessee-ag-investigating-ticketmaster-taylor-swift-ticket-chaos-rcna57629

Discussion points:

1) What sort of experiences have you and your classmates had with Ticketmaster and Live Nation?

2) What do you think can be done to fix these ticket acquisition issues?

3) Problem 2.1 A on page 2-38 of Wiley’s Financial Accounting: Tools for Business Decision-Making introduces us to the statement of financial position of Live Nation Entertainment Corp. Can you solve this problem?

That’s a Big Fraud Doc!

Posted by & filed under Fraud.

Description: An Alberta physician, Dr. Yifei Shi, has been convicted in what has been called the largest doctor billing fraud in the province’s history. In addition to a four-year prison term, Dr. Shi will have to repay $827,077 to the province. Dr. Shi will also face scrutiny from the College of Physicians and Surgeons of Alberta, and the professional organization can permanently revoke her license to practice medicine.

Date: November 18, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/canada/edmonton/family-physician-sentenced-largest-fraud-alberta-1.6655518

Discussion points:

1) As a tax-paying citizen, what is your reaction to this story?

2) Given that Canada appears to be suffering from a shortage of qualified medical professionals, do you think that the College should consider this in crafting its decisions for cases such as Dr. Shi’s?

3) In chapter 7 of Wiley’s Financial Accounting: Tools for Business Decision-Making we learn about the fraud triangle. What do you think may have been in play for each side of the fraud triangle in this situation?

Are Your Classmates’ Cars in Danger?

Posted by & filed under Accounting Principles, Student life.

Description: Zeynel Ari said that the time it took him to walk from a parking lot, into his bank, then back to the lot, was all the time it took for thieves to grab his vehicle. Car theft rings are getting better at their illegal craft, with the number of stolen vehicles in Ontario rising for five straight years. One secret to their success has been adopting technology that lets them steal electronic key fob signals from unsuspecting motorists, opening the door and the ignition to these unwelcome intruders.

Date: November 14, 2022

Source:  cbc.ca

 Link: https://www.cbc.ca/news/canada/toronto/top-10-stolen-cars-ontario-2021-1.6649053

Discussion points:

1) How many of your classmates drive one of the “top ten” cars mentioned in this article? How many have had a theft or break-in?

2) What do you think are some of the best measures to prevent a theft or break-in of an automobile?

3) In chapter 9 of Wiley’s Financial Accounting: Tools for Business Decision-Making we learn about derecognition of property, plant, and equipment (see section starting on page 9-18). What are the four steps involved in disposal? How might these be impacted by the theft of a vehicle?

Insolvencies Up

Posted by & filed under Accounting Principles, Student life.

Description: Insolvencies in Canada were up 22.5% over the same quarter last year. Statistics Canada said this was the largest year-over-year increase in 13 years. During the pandemic, a number of government programs seemed to have helped businesses and consumers to avoid this level of financial difficulty. But the rise of inflation, increasing interest rates, and the end of pandemic subsidies have created added financial pressure on Canadians.

Date: November 9, 2022

Source:  thestar.com

 Link: https://www.thestar.com/business/2022/11/09/consumer-insolvencies-rise-225-per-cent-compared-with-last-year.html?source=newsletter&utm_content=a13&utm_source=ts_nl&utm_medium=email

Discussion points:

1) As you read the article, did it cause you to reflect on your own financial situation at school this year?

2) What do you think might be the single largest factor contributing to the rise in insolvencies?

3) Starting on page 8-6 of Wiley’s Financial Accounting: Tools for Business Decision-Making we see a section on Uncollectible Accounts Receivable. What aspects of this news story might a company have to take into account as it considers its bad debt expense calculations?

Silence at Sobeys

Posted by & filed under Accounting Careers, Accounting Principles.

Description: Sobeys has gone virtually silent in the face of an apparent data breach last week. Customers at Sobeys and other related Empire Company stores, found themselves unable to process transactions normally. Problems included filling prescriptions at the pharmacy. Another food company, Canada Packers, also had similar problems last week, but it took a different tack, choosing to go public with news that it was victim of an attack.

Maple Leaf Foods Confirms System Outage Linked to Cybersecurity Incident

Date: November 9, 2022

Source:  globalnews.ca

 Link: https://globalnews.ca/video/9266721/empire-remains-silent-about-it-problems-that-impacted-sobeys-other-stores/

Discussion points:

1) Why do you think Sobeys and Maple Leaf had such different responses to similar problems?

2) If you were a senior accounting officer at a company, how would you advise your colleagues to respond to a security breach?

3) Starting on page 7-8 of Wiley’s Financial Accounting: Tools for Business Decision-Making we see a discussion of the limitations of internal control. Which of these limitations might be most responsible when a company has an incident like Maple Leaf or Sobeys?