Friday News Roundup 21.05.07: Isle of Man, Laurentian, slow CRA on CRB and more
Wrapping up the odds and ends in this week’s Canadian accounting news
TORONTO, May 7, 2021 – Tax Season 2021 “technically” came to an end last Friday. We say “technically” because many Canadian accountants worked throughout the weekend and beyond, trying to catch up to the backlog of tax returns to be filed. It’s important to note, as we proved back in 2018, that “the bread and butter of the sole practitioner public practice is the T1 tax return.”
Income tax returns also make up a sizeable portion of the revenue at SME firms, even as experts urge preparers to move to year-round recurring revenue. That made the 2021 tax season a kind of trial by fire, given the shambolic events leading up to D-Day, that fuelled more than 75,000 requests for an extension to the tax deadline.
But now that tax season is all behind us, it’s time to catch up on the odds and ends of news from the world of the Canadian accounting profession — and we’ve got a lot to catch up on.
Ontario Auditor General to check Laurentian University books
Bonnie Lysyk will conduct a value-for-money audit of Laurentian University’s finances from 2010 to 2020. The Sudbury post-secondary institution collapsed earlier this year amidst reports of financial management irregularities, which have raised questions about its accounting practices and the oversight of Laurentian’s external auditor, KPMG.
Back to the Isle of Man and tax evasion allegations
Five years after government hearings into offshore tax evasion shut down, the Standing Committee on Finance (FINA) resumed hearings this week, with testimony scheduled from KPMG. Why? It was largely due to the tireless reporting of the CBC and its flagship program, The Fifth Estate, which alleged a connection between a Montreal Ponzi scheme and a tax shelter scheme using the Isle of Man.
Day one of the hearings featured one of the many retirees who lost life savings in the scheme, and KPMG Canada’s managing partner for tax. KPMG has denied any connection to the scheme, which it reiterated during testimony before the committee, according to the National Post. Read the statement of Lucy Iacovelli, KPMG's Canadian Managing Partner for Tax.
KPMG busy bolstering service lines in Quebec
On April 30th (Tax Deadline Day), KPMG Canada announced the acquisition of Montreal accounting firm Lacroix Allaire Héroux Beaudry, Chartered Professional Accountants. This follows the March announcement of an unprecedented recruitment campaign aimed at adding nearly 450 experienced professionals in all of its business lines and the launch of the "KPMG Enterprise Virtual Office" initiative.
It’s tempting to see this as an arms race between KPMG and MNP, which has substantially grown its presence in La belle province through the February acquisition of 22 offices and about 500 employees in Quebec from Deloitte. In February 2021, KPMG also expanded its practice in Ottawa and region with the addition of Vanguard Professional Corp., as promoted in this sponsored content piece.
OTO says CRA slow on CRB
The Office of the Taxpayers’ Ombudsperson got in touch with us this week to say it is hearing from many complainants that the Canada Revenue Agency is taking an extensive amount of time to validate their eligibility for the Canada Recovery Benefit (CRB). In certain circumstances, the CRA agents cannot give a proper timeframe as to when their files will be assigned to a validation officer, leaving thousands in financial hardship. The OTO has filed a Request for Service Improvement with the CRA.
UofT Law School shunned by speakers as fallout continues
Academics and dignitaries are now cancelling speaking engagements at the University of Toronto over the imbroglio featuring a current Tax Court judge David Spiro and the Law School’s decision not to hire human rights lawyer Valentina Azarova as director of its International Human Rights Program. The Toronto Star reported this week that former governor general Michaëlle Jean, faced with increasing pressure to boycott the University of Toronto, cancelled her upcoming lecture. The Canadian Judicial Council is considering complaints related to the hiring incident.
Sage Canada report maps 2022 workplace recovery
When Canada eventually emerges from the current pandemic, what will workplaces look like in the future? A new survey from Sage Canada, Forward Together, examines the continued impact of COVID-19 on SMB business decision makers and working Canadians as well as their priorities and plans for a post COVID recovery.
Some highlights of the report? A majority of workplaces will allow some form of WFH to continue. Employers are concerned about employee burnout and are taking steps to address it. And businesses will prioritize spending in three main areas: technology, marketing, and employee retention.
How Canadian insurers will take on IFRS 17 implementation (Canadian Underwriter)
Where insurers stand on OSFI’s reinsurance rules (Canadian Underwriter)
U.S. capital gains tax hike could deal blow to Canadian startup funding (Financial Post)
We need to do better, be kinder, more empathetic — to accountants! (Kingston Whig-Standard)
By Canadian Accountant staff.