60 Years of Excellence in British Columbia 1951-2011

Meet the academics who are B.C.’s newest CGAs

Vol. 38 / No. 2 • SUMMER / 2011

A PUBLICATION OF THE CERTIFIED GENERAL ACCOUNTANTS ASSOCIATION OF BRITISH COLUMBIA

THE CASE FOR THE

CGA-BC solicits expert opinions on the benefits HSTof keeping the Harmonized Sales Tax in place

40069088 05 38 34

Vol. 38 / No. 2 • SUMMER / 2011

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16 Something new, 07 taxmatters 05 CGA-BCarchives something old How to access information Significant moments in the from the CRA – and pay Association’s history Michael Kane explores what’s at stake in your outstanding tax debts B.C.’s HST referendum 31 keepingTabs 09 techview CGAs in the news and Alan Salmon offers the members on the move inside scoop on cloud computing 32 currentAssets contents A round-up of all the latest 19 Why CGA-BC supports 12 periscope gadgets, technical gear the HST Learn how a whole-brain and apps approach can help you in all The significant benefits of a single value- facets of your life 2011 Quarter added tax 34 Century Club 14 ethics in focus CGA-BC celebrates the 20 The tax impact of the Evaluating an ethical achievements and contribu- HST on investment and dilemma tions of more than 200 CGAs competitiveness publicpractice Jack Mintz outlines the impact on the 28 36 partingShot provincial economy if the HST is replaced Edifier A Q&A with Shanalisa Keller, The evolution of accounting CGA, Financial Controller 25 CGA plus PhD makes a standards in Canada at Quicktech Computer powerful combination Consulting Meet the academics who are B.C.’s newest morethanNumbers CGAs 38 Letting the data tell the story

06 ceoupdate An Update on the CIC A and CMA Merger Discussion An update from Gordon Ruth, FCGA, CEO

outlook 03 2011 IT Forum. The future is yesterday. Are you on board?

editor’smessage outlook CGA-BCarchives

Since 1951, the CGA designation in B.C. has grown more prestigious and CGA-BC’s members have become ever more successful and influential. To celebrate the Association’s diamond anniversary, Outlook is featuring

executive committee important moments in the Association’s history as a way to pay tribute to the thousands of members who Chair: Bruce Hurst, FCGA have come before and to inspire the untold number of B.C. CGAs yet to come. Past-Chair/Treasurer: John Pankratz, FCGA First Vice-Chair: Cindy Choi, CGA Chief Executive Officer and Secretary: Gordon Ruth, FCGA

executive staff Chief Executive Officer: Gordon Ruth, FCGA Director, Administration, HR & IT: Dan Cheetham, CGA Director of Marketing & Communications: Edward Downing, MA (Journalism) > Few would have anticipated that ing class of 1986, the year that Director of Education & Student Services: A CGA pioneer the introduction of a tax that Gordon Campbell became mayor W. D. (Bill) Johnson, FCIS, PAdm, FCGA Antoinette B. (Toni) Paradis (1906-1986) economists hail as an economy of Vancouver and Bill Vander Zalm Director of Corporate Affairs: Juliana Laing, BA saver would get the reaction of was chosen as leader of the B.C. Director of Public Practice Services & Public Practice Advisor: On April 18, 1951, the provincial legislature the 21st century equivalent of the Social Credit party. Those two Tina Peters, BA, CGA enacted Bill 61, which had passed its third Boston Tea Party. But as we head individuals went on to play an Director of Member Services: Pamela Skinner, BSc, CFP, CGA reading one week earlier. It stated that the 15 men “and such other persons as 1951 1982 1991 to the June/July HST referendum, important, if not at times contro- outlook staff it really is anyone’s guess how the versial, role in the province. Still Managing Editor: Edward Downing (604) 730-6208 1999 2009 story will play out and whether their tenure demonstrates the Communications Manager: Patrick Schryburt (604) 730-6238 The business world moves quickly and technological change is a fact of life. CGA-BC’s the province will keep the HST incredible change that B.C. has Communications Officer: David Ferman (604) 730-6206 2011 IT Forum will feature technology workshops that can provide you with practical or return to the combination of undergone in the past 25 years Production Co-ordinator: Trevor Hargreaves (604) 730-6226 IT information, technological expertise and the social media tools you require to take the old GST and PST. Some polls and the backdrop to the world Advertising Co-ordinator: Pardeep Clair (604) 730-6228 your career or business to the next level. suggest that the tax is in trouble, the 216 graduating CGAs in 1986 Graphic Design: For more information or to register, visit: www.cga-bc.org/pd while others indicate that the tax helped shape. Core Associates Communication Design Inc. Regular Contributors: may get through. Our regular features include Ed Kroft, QC, LLB, LLM, CGA (Hon.); CGA-BC joined forces with CGA-Canada scription of CGAs and what differentiates Dr. Michael McDonald, CGA (Hon.); Alan Salmon. and all of the provincial CGA affiliates to them in the marketplace. Surveys show advertising create a new branding campaign, which that CGAs are well-recognized in B.C. and Taxing times For advertising rates, contact Pardeep Clair at was launched in 2009. This innovative across Canada and they have never been (604) 730-6228 or visit our website at www.cga-bc.org. campaign is built around the tagline ‘We more highly valued for their expertise and This issue of Outlook focuses an article on cloud computing, Outlook is the premier way to contact B.C.’s CGAs. see more than numbers,’ a confident de- integrity. on the tax and demonstrates just which, according to tech guru Advertising in Outlook magazine does not indicate an how important it is to making our Alan Salmon, is sure to change endorsement of any business, organization, service or product by CGA-BC. economy more competitive. Still, the face of computing and the Conference memories a program of more than 20 profes- Twenty-five years ago, mem- sional development seminars, the in the great tradition of democ- way that many organizations Outlook is published four times a year by the Certified bers from around the province longest-running accounting trade racy, all British Columbians will operate. And Ed Kroft provides General Accountants Association of British Columbia and gathered at the Westin Bay- show in Western Canada, and an have a chance to decide the fate some practical insight into how is sent to nearly 15,000 CGA members and CGA students. shore Hotel in Vancouver for awards banquet and gala. If you of the tax and by the next issue to access information online from Opinions expressed are not necessarily endorsed by CGA-BC. may hereafter become members of the CGA-BC’s first annual member want to know who this year’s this debate will likely be just a the CRA and how to make pay- Copyright CGA-BC 2011. Association, are hereby constituted a body conference. The 2011 confer- award winners are, you will have memory. ments on outstanding debts. articles, enquiries and letters politic and corporate under the name of ence will feature the Associa- to be in Victoria from September Speaking of memories, take a Remember, Outlook is your Articles, enquiries and letters should be sent to Outlook: ‘The Certified General Accountants’ As- tion’s annual general meeting, 21-25 to find out. look at our special coverage of magazine. If you have ideas or CGA-BC, 300-1867 West Broadway, Vancouver, BC, V6J 5L4 sociation of British Columbia’ (hereinafter the 2011 Quarter Century Club. suggestions for articles, please (604) 732-1211 or (800) 565-1211 called the ‘Association’).” You are bound to spot more than drop us a line via email or regular ISSN 1488-2337 Outlook - Certified General Accountants “Other persons hereafter” would soon a few familiar faces as we provide mail. We are waiting to hear from Association of British Columbia refer to women as much as to men, as photo coverage of the graduat- you. Antoinette Paradis was the first woman CGA on the web to become a CGA in B.C. She served as Members and students, you can find all of your most assistant to the Executive Secretary from important CGA-BC services online at www.cga-bc.org. 1951-1961 and was the first female Fellow in 1970.

The evolution of the CGA BRAND Fashion changes, and styles come and go. Agreement no. 40069088 While the three letters after every mem- Return undeliverable Canadian addresses to: ber’s name have not changed in 60 years, Edward Downing is CGA-BC’s Director of Communications CGA-BC, 300-1867 West Broadway, Vancouver, BC, V6J 5L4 the graphical representation of those [email protected] Printed in Canada letters has evolved over time. In 2008, Award winners at 1986 Conference

04 outlook outlook 05 Ed Kroft, QC, LLB, LLM, CGA (Hon.) ceoupdate taxmatters

> Dear colleagues: ment that CGA withdraw its support for gate that risk, as well as reduce confusion ecent postings on page on the CRA website The CRA encour- concern your taxes), the Agreement on Internal Trade [AIT]) over introducing a fourth designation in the Canada Rev- describes how to access this • if you are representing It has been a month since the Canadian were not acceptable to CGA, discussions the marketplace. However, the Institute enue Agency (CRA) and other types of informa- ages individuals, someone else or an organi- Institute of Chartered Accountants and did not proceed. We did offer to explore felt tagging for a 10-year minimum Rwebsite prompted tion by using “My Account” zation, their name, the Society of Management Accountants other alternatives, but the CAs and CMAs period was required for their members to me to write about two top- or “My Business Account,” or businesses and • the return address where of Canada announced their intention to rejected those overtures and terminated support this process. ics that interest taxpayers: by calling the CRA directly. you’d like the information enter into merger discussions. Since the discussions. The second issue was the AIT. Currently, how to access information The T20 audit report other groups to to be sent, news broke, a few of you have contacted I would like to elaborate a little on there is a challenge led by the Govern- from the CRA and how to prepared by CRA auditors • your original me directly, while others have expressed CGA’s perspective on tagging and the ment of Manitoba against Ontario for make payment arrange- will also generally be made consider infor- signature(requests must their opinion on social media sites such AIT. this exception under public accounting ments for unpaid tax debts. available to a taxpayer so be mailed and cannot be as LinkedIn, Twitter and at CGA-Canada’s One of our primary goals throughout in support of the underlying principles I welcome CRA officials to that the taxpayer can better mal methods to faxed or emailed), www.visioncga.org. Although little has the discussion process was to protect the of full labour and professional mobility. write to the editor of Outlook understand the CRA position • the date range, if ap- changed in the interval, it is important to interests of CGAs in a merged organiza- If the challenge is successful, this may to add any pertinent infor- if he or she is contesting a obtain informa- plicable (for example, “I update you on the issue. While a majority tion. This was one of our main concerns benefit CGAs in all provinces. We were not mation that they believe CRA assessment or reassess- would like copies of my tax of people who contacted me supported with ‘tagging,’ where CGAs, CMAs and CAs prepared to drop our support of this chal- would assist taxpayers ment through the notice of tion for previous records for the reporting CGA’s position, a small number were curi- would have to state both their original lenge as we believe that CGAs must have beyond what I have written objection process. Taxpay- years 2002 to 2004”), ous why CGA didn’t remain in the discus- designation and the new designation for full professional mobility across Canada tax years. • a description of the records sions and why ‘tagging’ was such a stum- a minimum period of 10 years. The re- under the AIT. you want, such as copies bling block. Others mistakenly thought quirement was for a member to use both, There are benefits in having a strong of income tax returns, as- unified profession that certifies and Making late payments for unpaid tax debts to the CRA sessments, reassessments, speaks for all professional accountants records that pertain to An Update on the CICA and CMA and CGA fully supported exploring that CRA outlines rules for audits, collections, appeals, option. We believed that the best route to etc. (provide enough detail Merger Discussion a united profession was to bring all three access to information so that an experienced parties together as equals and agree on employee of the CRA can that CGA had broken off the talks. not simply the new designation. With the vision and principles at the start of in the space here and what ers should contact the CRA identify the records you First, I would like to clarify some of tagging and a lengthy history of conflict any merger discussion. is included on the CRA auditor at the conclusion want), the facts. When CGA learned that our over professional rights, there was the Since this issue is ever changing, I website. of the tax audit to obtain a • consent – if you are repre- competitors were in merger discussions, real prospect that the interests of CGAs encourage you to stay up to speed by copy of this report. senting another individual, we approached them with a desire to see could be compromised. We wanted a visiting our website and visioncga.org, Accessing You can also follow the provide a letter of autho- instead if this was a potential opportunity structure that would ensure that the and also linking to us on Twitter and Information more formal processes to rization, signed by the to unify the profession. We held explor- interests of CGAs would be respected other social media sites. You can also from the CRA obtain information by mak- individual and dated within atory talks and the other two bodies set and that CGAs would have the same email us directly with any comments at The CRA will send taxpay- ing an application under the last 30 days, authoriz- several non-negotiable conditions before benefits as other members in the new [email protected]. In addition, as we ers information whether or the Access to Information Act ing the CRA to disclose we could move on to formal discussions. organization. Reducing the 10-year term visit the various chapters across the prov- not they want to receive it. or Privacy Act. The former is the individual’s personal Since two of these conditions (what is significantly or simply eliminating the ince, we will continue to update members However, taxpayers some- used to access information information to you as their known as ‘tagging’ and their require- ‘tagging’ as a requirement would miti- about this issue. times want more. There is about corporations or about representative, and both a formal and informal CRA assessing practices in • for Access to Information process by which to obtain general. The Privacy Act is requests, a $5 application additional information from used to obtain information fee paid with a cheque or the CRA. about individual taxpayers. money order payable to The Access to Information To start this process, you will the “Receiver General for Act and the Privacy Act both need to complete and sub- Canada”. include formal processes mit an Access to Information Gordon Ruth, FCGA for accessing some types of Request Form and a Personal You may also need to submit CEO government information. Information Request Form, the following information for However, much information available on the Treasury business-related requests: can be obtained informally, Board of Canada Secretariat • a corporate profile report and the CRA encourages website, at www.tbs-sct. and authorization, if ap- Ed Kroft, QC, LLB, LLM, individuals, businesses and gc.ca. plicable (dated within the CGA (Hon.), is a partner Quebec Explores a Different Route other groups to consider As outlined on the CRA last 30 days), While the current two-way merger discussions are underway between the CAs and CMAs, a parallel three-way discussion among CGA, informal methods to obtain website, you must include all with Blake, Cassels & • business name, if appli- CA and CMA has been taking place in Quebec. The province of Quebec regulates the professions differently from other provinces and information such as copies of the following information Graydon LLP. He is a cable, their regulatory body – the Office des professions du Québec – has required that the three bodies explore the possibility of creating a of T1s, T5s, RRSP receipts with your request: member of the firm’s Tax • business number, if ap- unified body. The professional accounting bodies in Quebec are in discussion at this time and are operating independently from the and records of income and • your name, Group and leader of its plicable, and national bodies in this process. How this will impact national discussions, especially if the Canada-wide discussions do not proceed, is deductions for previous • your social insurance num- Tax Controversy & Litiga- • the name of the specific uncertain at this time. The Association will provide an update as it becomes available. tax years. The Contact Us ber (only for requests that tion Group. account(s) for which you

06 outlook outlook 07 Alan Salmon techview

are seeking information, for and all related correspon- the control of a govern- payment arrangement by: hat is cloud ing Customer Relationship Excel, Word and PowerPoint cations as well as desktops example: corporate [RC], dence for reference. ment institution. In other • calling the CRA Debt computing? Management applications). components of Microsoft and servers. In a hosted GST [RT], payroll [RP], etc. • To make a formal request, words, there is no require- Management Call Centre at Although there Companies such as Net- Office. In fact, Google Docs desktop/server environment, either fill out a request ment for the CRA to create 1-888-863-8657 (available is no one-size- Ledger (now NetSuite) and can even open files created users make connections – records to comply with your Monday to Friday from 7:00 W The CRA website also in- form or write a letter. If you fits-all definition, most cloud Intuit soon began offering in Microsoft Office and save typically over the Internet cludes the following helpful write a letter, mention the request. am to 11:00 pm EST), computing environments web-based accounting soft- files back to Microsoft Office – to their desktop platforms. tips: appropriate Act: the Access • As a requestor, your identity • making a pre-authorized share four common charac- ware tools, some of which formats. Other companies One obvious advantage of • Ask if there are other ways to Information Act or the is protected under the Pri- debit payment using the teristics: were developed specifically such as Zoho offer a suite of this technology is that users to request the information Privacy Act. vacy Act. CRA’s “My Account” service, 1. Cloud computing is typi- for deploying through the web-based services compa- can access their desktops you require without having • If the records you want are or cally delivered over the cloud, and some of which rable to those provided by and data from virtually any to submit a formal request. likely to include personal Paying Your Tax Bill • calling 1-866-256-1147 to Internet, but it can also were merely hosted versions Google Docs, and in April device that provides a web • You don’t have to give a information of other indi- If a taxpayer cannot pay the use the TeleArrangement be delivered over local of traditional, desktop-based 2011, Microsoft announced connection. Additional ben- reason for asking for the viduals, the CRA recom- balance owing on or before service to make a payment networks. applications. that its Office 365 service efits include potential cost information, although an mends that you provide April 30, the CRA will accept arrangement. You will need 2. Cloud computing services As high-speed Internet is now in the public beta savings, reduced administra- explanation might help CRA their “consent,” signed and a payment arrangement to provide a social insur- are generally accessed connections became widely phase. tive issues and enhanced staff find the material you dated within the last 30 only after the taxpayer has ance number, date of birth through a web browser, available, many individuals On the accounting front, security over data. want. days, to authorize the CRA reasonably tried to obtain and the amount entered on niche players such as Bill. The growth in cloud • Make sure that your contact to release their personal the necessary funds by line 150 from the last return com, Wave Accounting and computing has exploded information is shown clearly information to you. borrowing or re-arranging for which the taxpayer FreshBooks offer specialized in recent years to touch on your request so that the • The rights of access under his or her financial affairs. If received a notice of assess- This concept has exploded in recent years to touch potentially services to target audiences. potentially all aspects of CRA can contact you if they the Access to Information the taxpayer cannot pay the ment. TeleArrangement is all aspects of our computing experience And virtually all traditional our computing experience. need clarification. Act and Privacy Act are balance in full, they should available Monday to Friday, desktop accounting solu- Applications, data, desktops, • Keep a copy of your request restricted to “records” under contact the CRA to make a 7:00 am to 8:00 pm EST. tions can now be accessed servers, infrastructures and Cloud Computing: The Inside Story through hosted environ- development platforms are ments. now available in the cloud although this is not a and organizations began Cloud-based tax prepa- from multiple providers. strict requirement. using tools to access their ration tools are available The following brief review 3. Cloud computing services computers from remote through accounting firms, of key cloud-centric terms are scalable, both upward locations, with early players as are many document provides a foundation for and downward. This in this market including management and workflow understanding the potential means that new users can pcAnywhere and Citrix. tools as well as engagement benefits and risks associated be added quickly, or if the Amazon was one of the management products and with cloud computing. workforce shrinks, users first large companies to time and billing applications. can easily be removed. jump heavily into cloud Another growth area has Software as a Service 4. Cloud-based applications computing. Amazon Web been in the hosting of appli- (SaaS) is what many non- Blair Mackay Mynett are typically hosted on a Services is a web-based technical computer users Valuations Inc. remote server, and data is infrastructure platform that think of when they think of likely hosted there as well; allows organizations to “rent” cloud computing. SaaS is a is the leading independent business however, in some cases services on an as-needed Alan Salmon is a leading web-based application deliv- authority on accounting valuation and litigation support practice – often for privacy and se- basis. Through this platform, ered over a network through curity issues – data is kept companies can access Ama- technology. He is the CEO a web browser. In today’s en- in British Columbia. Our practice focus within the organization. zon’s e-commerce services; of K2 Enterprises Can- vironment, SaaS can include is on business valuations, mergers provide video, music and ada, a North American such applications as Intaact, and acquisitions, economic loss claims, Many people believe that other bandwidth-hungry consulting firm providing Google Docs, Microsoft Of- forensic accounting and other litigation cloud computing is a rela- services to customers; and technology training to fice 365 and some compo- accounting matters. We can be part tively new phenomenon, offer computing capabilities accountants. In addition nents of the ProSystem fx originating in the past five to remote workers. suite from CCH. of your team, providing you with the to his work with consul- years or so. In fact, the no- Google has also helped SaaS applications typically experience your clients require. tants, accountants and tion of cloud computing has to promote the concept of software companies in charge a monthly subscrip- existed since the 1960s. cloud computing, particu- tion fee and users only pay both Canada and the US, Suite 1100 Left to Right: Cloud computing re- larly with end users. In 2006, for what they consume. he is the chairperson of 1177 West Hastings Street Vern Blair, Cheryl Shearer, Robert D. Mackay, mained largely a theory until Google launched Google Another potential advantage Vancouver, BC, V6E 4T5 Kiu Ghanavizchian, Chad Rutquist, the Accounting Technol- the late 1990s when Sales- Docs, a web-based service of SaaS is that applications Telephone: 604.687.4544 Gary M. W. Mynett, Chris Halsey-Brandt, ogy seminar series. He Facsimile: 604.687.4577 Andy Shaw, Jeff P. Matthews, Farida Sukhia force.com introduced ap- that gives subscribers access are remotely hosted. Little, if www.bmmvaluations.com plications delivered through to online spreadsheet, word can be reached by email any, investment in addi- a website (Salesforce.com is processing and presentation at [email protected] or by visit- tional hardware is needed now one of the world’s lead- tools that are similar to the ing www.k2e.ca. to run SaaS. Thus, even older

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hardware can typically access web apps include Google accessing these assets over a Microsoft Office – reside on • strengthened security, and the assets to obtain the 80 SaaS, resulting in reduced Apps, Microsoft Office Live network, typically the Inter- remote servers, with end • environmental responsibility. benefits of cloud computing, Spending on Cloud Computing capital outlays for technology. and WebEx Web Office. net. Hosted applications are users accessing their own but we must also manage the For many organizations, usually not optimized for this personalized desktop over a 60 For organizations seeking to risks to avoid failure. Because perhaps the biggest advan- An Application Service Pro- environment; as such, they network. While this network is realize any of the benefits out- there is much uncharted ter- tage of running SaaS is that vider (ASP) is an organization often run in a multi-instance often the Internet, it can also lined above, cloud computing ritory with respect to cloud all maintenance, backups and that manages and distributes rather than a multi-tenant be a private network. To the 40 may become a strategic asset, computing – and because other administrative functions software-based services from environment. For example, end user, the process is seam- not just a technology utility. most individuals are averse are outsourced, with the ser- a centralized data centre. ASPs organizations such as Right less: the user runs a computer Yet there are also significant to change – many people are vice provider assuming these typically license software from Networks, InsynQ, Real Time that looks exactly as it would 20 risks and uncertainties associ- nervous about transitioning responsibilities as part of the other organizations and then Data Services and Awensa all if it resided on a local device. ated with cloud computing, to the cloud, fearing they will service contract. deploy that software over a host the desktop edition of Certainly the most visible 0 including: select the wrong provider network to a large number QuickBooks and make it avail- trend in cloud computing is • security, or that sensitive data will Web Applications (web of users. ASPs were the early able on a monthly subscrip- that of increased spending. 2008 2009 2010 2011 2012 2013 • privacy, become compromised along (est.) (est.) (est.) (est.) apps) are applications in forerunner to SaaS. Perhaps a tion basis. Organizations are investing • compliance, the way. As professionals, which some or all parts of bit ahead of their time, ASPs A large growth area for in cloud computing at a rate Source: Gartner Group • integration with other ap- managers and technology the software are downloaded have largely given way to hosting has been in the seg- that far outpaces that of other plications and databases, consumers, we must learn each time the app is run. Web SaaS. ment of hosting desktops categories of spending on benefits include: • scalability, • transitioning back to on-site how to manage through apps are usually browser- and servers. In these models, information technology. For • reduced capital outlays and • improved customer/client solutions, and these issues so that we are in based with the program Hosting refers to running client desktops – includ- example, in 2010, the Gartner operating expenses, relations, • reliability. the best possible position to instructions contained within apps and storing data on ing traditional tools such Group estimated that 2009 • improved performance and • remote access to applica- realize the benefits associated the web page. Examples of third-party hardware and as Microsoft Windows and spending on cloud comput- reliability, tions and data, Not only must we manage with cloud computing. ing was $56.3 billion, up from $46.4 billion in 2008. Perhaps more significantly, cloud spending is expected to increase to over $150 billion annually by 2013. Cloud computing is im- portant to your organization because of its many poten- tial benefits. It represents a potential seismic shift in how most organizations will oper- ate, every bit as profound as the transition from main- frames and dumb terminals to the personal computer environment in which most of us operate today. Cloud computing is dif- ferent. In some cases, we may feel as if we have lost control of our applications, infrastructure and data and are depending on outside parties to keep critical busi- ness processes running. In other cases, we may be happy to hand over our headaches to someone else. Neverthe- less, there are other profound WE ARE SOLUTION PROVIDERS SPECIALIZING IN DATABASES and DATA reasons why this change is MANAGEMENT. If you need to develop a new software application, rebuild an old one, important. or connect one to another, our Microsoft Certified specialists can help. We can make First, there are enormous potential benefits that can www.compuwork.net your data work for you. CALL TODAy fOR A fREE CONSULTATION: 604-684-8211 accrue in the cloud. These

10 outlook outlook 11 Brian Thwaits periscope

rains are sure trendy The good news, of course, While it’s Many of us live in a world us for the task, genuine com- manages speech, reason of their brains. these days, aren’t is that many recent dis- that’s heavy on words, prehension only takes place and analysis. Meanwhile, Decades ago, Alvin Toffler they? coveries from the world of absolutely numbers, facts, figures and once we actually engage in the right side looks after the wrote in Future Shock that B Not a day goes by neuroscience are suggesting statistics – and our brains the activity.) more sensual parts of our “the illiterate of the future without numerous media ref- tremendous possibilities that need help acquiring and One reason that active lives: space, touch and vision won’t be those who can- erences to that three-pound can impact our lives, both important to managing all that data. To learning works so much – as well as symbols, rhythm not read and write – but organ inside our heads. The personally and professionally, do so, we spend much of better than passive learning and emotions. those who cannot learn, word pops up on magazine in very positive ways. develop strong our time engaged in passive is that the former requires And what neuroscien- unlearn and relearn.” Given covers, as well as in news- For one thing, we now activities like reading and more mental effort. But an tists are telling us, is that, the knowledge-laden and paper articles and online. know that our brains can left-brain listening. Yet a major prob- even more important factor while it’s absolutely technology-driven world And bookstores are creating change over time. They’re lem with those methods of is that it engages both sides important to develop we’re now living in, it’s safe stand-alone displays for the plastic, meaning that they’re skills to be learning is that we read and of the brain. strong left-brain skills to say he was definitely on ever-growing proliferation of malleable and capable of listen at a much slower pace The simple version of the to be successful, it’s the mark with that predic- books about this endlessly growing fresh neural path- successful, than the very fast speeds at two-sides-of-the-brain story the potency of the tion! fascinating topic. ways as we gain knowledge which our brains are capable is that logic is looked after right side that will In a modern world that it’s the potency of processing information. by the left side and creativity make our brains demands that we not just We can help our brains by the right. However, it’s a work even better. keep up with – but learn of the right (and the brains of those bit more complicated than It’s not a coincidence and assimilate – an ever- we’re interacting with) by that. The left side controls that the greatest increasing amount of new Discoveries in neuroscience shed light on how we learn side that will adding active features that those school/work tasks thinkers and learners information, we’d be foolish will help us deal with the such as reading, writing in history have been not to take heed of those Train Your Brain make our slow, passive acts of reading and arithmetic, and it also strong on both sides very wise words. and listening. For instance, Brains for business. Brains and learn new skills. Obvi- brains work when we create written ma- for school. Brains for home. ously, this is exciting news, terial, it’s helpful to include How to use our brains to suc- as we live in a modern world even better. visual imagery with words ceed. How to use our brains where dealing with constant and numbers. In reports, for TRY OUR to learn better. How to use change is a tremendous example, it’s often the tables, BASIC MANAGED SERVICES our brains to improve our challenge. charts and graphs that stick WHEN YOUR BUSINESS RELIES CUSTOM PROGRAMS relationships. And it’s not just that in our heads rather than text AS LOW AS $700 A MONTH Advertisers have jumped brains are simply capable of buried in dense paragraphs. ON COMPUTERS AND DATA, on board, too. Not only do change. In fact, they thrive Adding both pictures and The ongoing monitoring and preventive we see plenty of brain imag- on change! Indeed, it’s the sound to verbal material is server maintenance included in this ery used to sell everything process of being engaged even more useful. 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By Michael McDonald, PhD, CGA (Hon.) ethics in focus THE DILEMMA: Has Silverman acted ethically? is required. When anyone joins a board of restricts a member from providing assurance pendence as used in the accounting profes- costs. The CEO of K&L, Kevin Kermit, tells Sam Silverman, CGA, conducted an Let’s address this question by examining the directors they assume both fiduciary and non- services if the member holds a direct financial sion: be independent both “of mind” and “in Mona that he has read that this area is audit of ABC Mining Explorations, a sequence of Silverman’s actions: fiduciary responsibilities – namely, to act on interest or a material indirect financial interest appearance.” The latter refers to the practitioner underaudited by the CRA and that some new mining venture. He then joined behalf of the interests of shareholders in a way in the client. ensuring that their integrity, objectivity or consultants are claiming 90% success the board of ABC and received an 1. Issuing an audit that is both legal and ethical. However, there is Next, he lets the audit be used as a comfort professional scepticism has not been compro- rates for their clients’ applications just by option on 100,000 preferred shares 2. Joining the board of ABC something additional in play when a profes- letter after he has accepted the director posi- mised. Sam was unable to avoid appearing to downloading authentic-sounding jargon as a director’s fee. Silverman then 3. Accepting the stock option as a sional such as a CGA or a lawyer joins a board tion, something he shouldn’t have allowed. lack independence from his client. from the Internet and incorporating it allowed his audit to be used as a director’s fee – credibility. This is in part why companies There is a real problem of appearance here. Lastly, there is the fifth element – accepting into their applications. (See www.the- comfort letter with securities regula- 4. Allowing the audit to be used as a try to recruit accountants, lawyers and other Let’s use the familiar publicity test for ethics: the stock options but not reporting them to globeandmail.com/report-on-business/ tors. However, he never disclosed to comfort letter to regulators professionals as directors. “What would fair-minded observers say if they regulators. Here, Sam and the board as a whole flawed-rd-scheme-costs-taxpayers-bil- regulators the stock options he had 5. Not disclosing the stock option to witnessed this sequence of actions?” They have crossed a very serious line. It is frankly im- lions/article1939418/). received as a director. regulators Where ethical problems emerge would likely regard Sam’s acts as suspicious. material whether or not Sam ever exercises the Kevin tells Mona that while he doesn’t After a brief run up on the over- Where ethical problems emerge is in the He seems to have offered the comfort letter options. Potential investors need to know in want to do anything underhanded, he the-counter (OTC) market, ABC de- Except for the last two steps, each step in sequence of Sam’s actions. First, he does the in exchange for board membership and the advance how many shares are in play, includ- would like to substantially boost K&L’s clared bankruptcy, and angry inves- this sequence would be ethical if done with audit, and then he joins the board and accepts stock options. A more sceptical observer might ing options. By not informing the regulator, performance on SR&ED applications tors confronted Silverman about his appropriate professional skill and diligence. Is- the stock options as a director’s fee. CGA-BC’s even speculate that Sam issued a favourable Sam and the board deprive investors of that “without spending a pile of money on failure to disclose a potential conflict suing an audit on a start-up company and then independence rule R719 requires than a firm audit in order to get on the board and acquire knowledge. Yes, Sam can say that he did not R&D experts.” Mona expresses concern of interest. Silverman says that he allowing the audit to be used to support a withdraw from an audit if a practitioner accepts the options. Sam really appears to be run- profit from the options, but that does not take that it will be hard to do this since K&L didn’t use the option and therefore comfort letter are normal steps in providing as- a position as a director. In addition, rule R704(a) ning together two roles that ought to be kept away from the fact that he held the options. lacks in-house R&D expertise. Kevin sug- was not in a conflict of interest. Has surance to potential investors. In this situation, separate: auditor and director. If he did one or gests that maybe they will have to bring Silverman acted ethically? an auditor needs to be familiar with relevant the other, but not both, he could have avoided in someone who worked in audit at the sections of the CICA Handbook and securities many ethical woes. CRA and who knows what will make an regulation. With respect to providing a comfort Added to this is the context of the OTC application successful. But first Kevin letter for a mining company, the auditor’s role In January 2011, after 41 years of univer- market – a market that has an unfortunate and Next Issue’s Dilemma: wants Mona to “see what she can do and is akin to the geologist’s in providing essential sity service, Michael McDonald retired lengthy history of investment scams in the Mona Livona is a CGA employed by report to him next week with a plan!” information about the underlying value of the from the Maurice Young Chair of Applied mining industry, among others. If anything, this Kermit & Long Business Services, which What should Mona recommend? securities being offered for sale. In either case, Ethics at the W. Maurice Young Centre for makes appearances even worse. Accountants focuses on helping start-up companies what matters to investors and the public are Applied Ethics at the University of British and other professionals need to avoid creating secure financing. K&L has experienced Please email us your responses the independent judgement and scepticism Columbia. In 2006, McDonald received an the appearance of a conflict of interest. It dam- difficulty in helping companies with their to these questions. We accept that a professional brings to the situation. Honorary CGA for his extensive work in ages the credibility of the individual and the applications for the federal Scientific anonymous submissions provided Similarly, joining the board and receiving accounting ethics education. McDonald profession as a whole. Said differently in the Research and Experimental Develop- we can verify that you are a CGA stock options as a fee are normal and generally welcomes suggestions for new cases and context of CGA-BC’s Independence Standard, ment (SR&ED) program, which provides or student. Send your feedback to ethical business activities. Again, due diligence solutions for this column. Section 1.5, there are two aspects to inde- substantial rebates for development [email protected].

14 outlook outlook 15 COVER Something

What’s at stake in B.C.’s HST referendum New By Michael Kane

espite promises of cash today and Pankratz recalls a client who manufactured lower rates tomorrow, opinion still steel girders for a customer in Alberta and appears to be divided among British was assessed $45,000 in PST because the DColumbians on whether they will support the company shipped the goods itself instead of HST in the upcoming referendum. Polls in hiring somebody else. early June suggested the tide may be turning “It depended on who did the trucking,” Something in favour of the HST, but it is still too close Pankratz says. “There were numerous situa- to call. tions in high tech and in manufacturing that Defeat for the HST raises the spectre of go- were particularly awkward with the applica- ing back to the cumbersome provincial sales bility of the PST/GST. Those of us who dealt tax in combination with the federal goods with two levels of tax were happy to see the and services tax. exit of the PST because of its complexity.” For the province’s businesses and their tax For the provincial government, ditching advisors, that would mean the higher costs the HST would mean the loss of a broader and complexity of returning to two sales tax base and more stable source of revenue. taxes instead of one, two levels of govern- It would tilt the burden of taxation back to ment bureaucracy instead of one, and an manufacturers and exporters, while exempt- array of conflicting and convoluted rules. ing much of the growing service economy. Consider that the old PST was payable on The province would probably have to repay unicycles but not bicycles, on recharging a Ottawa the $1.6 billion it received to make car battery but not boosting a dead car bat- the transition to the HST while hiring back tery, and on flower bulbs but not onion bulbs. 300 tax collectors and spending $35 million “The logistical problems of going back to each year to run a new PST office. the PST would be immense; it would be a Consumers would be faced with making nightmare,” says John Pankratz, FCGA, our up the tax losses and/or making do with Past-Chair and Partner of his Abbotsford reduced government services as well as con- firm. “We really prefer the relative simplicity tinuing to pay 12 per cent in sales taxes. They of the HST.” would also face higher prices because most O16 outlook ld outlook 17 COVER

“The logistical problems of going back to the PST Why CGA-BC Supports the HST

would be immense; it would be a nightmare. CGA-BC has been a proponent of a harmonized sales tax for several years. Our sup- We really prefer the relative simplicity of the HST.” port goes back to 2005 when Rick Thorpe, who was Minister of Small Business and Revenue and Minister Responsible for Regulatory Reform, launched a review of the John Pankratz, FCGA, Past-Chair PST. As a key contributor to public and tax policy matters, CGA-BC participated in the consultation process and sent several communiqués to the membership inviting their feedback. In addition, the Association’s review process also targeted members “It is not huge, but it is new-found money. The PST who were identified as experts in the area of the provincial sales tax. After consulta- tion and discussion, the Association submitted a proposal to the provincial govern- was such an antiquated tax and over the years it had ment at the end of April 2006. At that time, the common thread of opinion from the membership was that PST become subject to so many exceptions to the rules.” rules were far too complicated and convoluted for small and medium-sized business Bruce Hurst, FCGA, 2011 Chair operators to interpret accurately. This left businesses and business owners vulner- able to government auditors whose interpretations of PST regulations seemed to vary over time, by region, and even from auditor to auditor. A number of other com- ments related to specific problems within certain sectors or industries. And this led to all kinds of confusion and confusing applications. For instance, garden soil mixes that contained 50 per cent or more of sand, gravel, topsoil or fill were taxable. Garden mixes that contained more than 50 per cent of a combination businesses would no longer receive a full Without the Premier’s tweaks, that would primary residence to ensure that, on aver- CGA-BC argues that the HST is a fairer of manure, peat, sawdust or any other chemicals or organic soil stimulants were PST rebate on sales tax paid on items they buy add up to $1.33 billion more in sales tax in age, purchasers of new homes valued at up tax system than the old retail tax. It follows exempt. A biology class frog was not taxable but the rules governing a class hamster to make a product or service, as they do 2011/12, even taking into account existing to $525,000 do not pay any additional tax a global standard — now used by more were unclear. Animals sold as pets were taxable, though animals, dead or alive, pur- under the HST. Those cascading extra costs rebates to low-income families and income due to harmonization. That is, they will than 140 countries — while increasing chased by schools or school boards for student research projects were non-taxable. would again be embedded in final prices. tax relief provided to all taxpayers when pay no more in provincial HST than was compliance rates and reducing compliance One did not have to look hard to find rules that made very little sense. Bags For all British Columbians, turning back the HST was introduced. Businesses would previously embedded as PST in the price costs for businesses large and small. specifically designed to carry school books and supplies were PST exempt. But, the clock would mean a loss of investment, pay about $730 million less in taxes. of a new home. (Previously, the purchaser “Unwinding this thing will be an impos- according to the list of taxable items, briefcases, attaché cases, roll bags, backpacks, growth, exports and jobs, as detailed in the Clark’s changes will cost corporations of a newly built home did not pay PST on sibility, it’s just not feasible,” says David sport bags and tote bags were not specifically designed to carry school books and May 4 report of the government-appointed $353 million each year by 2013 while small the purchase price. However, builders had Fairhall, FCGA, author of CGA-BC’s Tax supplies. independent panel on the HST or PST/GST business will forgo a promised tax cut to pay PST on most construction materi- Tips and a member of the Association’s Although the government of the day was not particularly receptive to harmoniza- debate. worth $280 million. When the 10 per cent als used to build a home, so the PST was special HST review panel. “Anybody who tion, many of our members suggested that this would be the best course. Our paper On the face of it, harmonization should HST is in place, average families will be part of the cost of construction and was promises to take us back to the PST will to the Minister highlighted the benefits of a single value-added tax, recognizing have brought harmony by integrating the ahead of the old PST/GST by $120 a year. included, or “embedded”, in the total sell- be in the same position as Jean Chretien that it would: old 7 per cent PST with the 5 per cent GST By then, critics note, the average family ing price of the home.) when he promised to get rid of the GST. to create a single 12 per cent HST. Instead will have shelled out $815 more than under The panel’s report also shows that the He just won’t be able to do it.” • greatly reduce the administrative burden with tax collection and assess- it wrought uproar, largely because of the the old system because the HST applies to a benefits of the HST were oversold. It esti- Bruce Hurst, FCGA, our 2011 Chair, ment, especially for small and medium-sized businesses; Liberal government’s failure to consult the broader array of goods and services. mates the HST will generate about 25,000 says businesses have welcomed reduced • eliminate price distortions in the market and improve the competitiveness public after promising that the HST was Routine spending now taxed at 12 per additional jobs by 2020 versus the govern- red tape as a result of the HST and are of B.C. and Canadian products; and not on its agenda. cent rather than five per cent includes ment’s initial claim of more than 120,000. coming to realize that it leaves them with • remove sales tax “cascading,” where the PST is applied to items at multiple Since then, former Premier Gordon restaurant meals and snack food, haircuts, While business groups and economists more money to invest in equipment, hir- or different points of the production and distribution chain, resulting in a Campbell has resigned while successor movies and magazines, maintenance and are generally supportive of the HST — ing, or raises. higher retail price. Christy Clark has moved to shore up the repair services, tobacco and professional with the notable exception of the food ser- “It is not huge but it is new-found HST’s prospects in this summer’s mail- services. vices industry, which didn’t have to collect money,” he says. “The PST was such an Since we made that recommendation, the Association has continued to speak in in referendum by promising one-time Non-routine spending that used to PST on restaurant meals — critics like Seth antiquated tax and over the years it had be- favour of the HST in its annual pre-budget submissions, views that were bolstered transition cheques to about half a million be taxed at five per cent GST and is now Klein are not sold on Clark’s fixes. come subject to so many exceptions to the by support for the HST in other provinces and nationally by CGA-Canada. The As- families and 350,000 seniors, followed by a subject to HST includes conveyance costs The B.C. director of the Canadian rules. Even for an accountant, it was really sociation reaffirmed its support in 2010 when the HST was implemented. Earlier this gradual lowering of the HST rate to 10 per such as realtor commissions, structural Centre for Policy Alternatives would difficult to keep up with all the nuances.” year, CGA-BC continued to advance its view in favour of the HST through its decision cent by July 1, 2014. home renovations and repairs, and the prefer to see a far broader expansion of The panel concluded that returning to to join the Smart Tax Alliance and in its submission to the Independent Panel that The fixes will be largely financed by high- purchase of new homes. It should be the low-income HST credit paid for by the old PST/GST will mean fewer new jobs was formed to provide a report on the HST in advance of the June 24 referendum. er business taxes, which goes a long way to noted, however, that the province provides higher corporate income taxes. He said the and will put B.C. producers at a disadvan- The overwhelming message from members in 2006 was the same as it is today: address the independent panel’s findings a rebate for new homes purchased as a government has been forced to admit that tage to rivals in Ontario and other jurisdic- the HST makes good fiscal sense for B.C. Members perceive sales tax harmonization that the HST shifts taxes from businesses the HST shifted too much onto consumers tions that have adopted the HST. Virtually as a competitive advantage that simplifies accounting, record keeping and bureau- to consumers and is not revenue-neutral as and too much off corporations, but lower- all economic analyses suggest the HST cracy. B.C.’s economic growth and success can be achieved by aligning the fiscal first promised. The panel found that B.C. ing the rate leaves a $1.3 billion hole in boosts economic growth, productivity, strategies, policies and actions of government in a coordinated fashion and the HST families will pay an average of $350 more Michael Kane is a freelance writer based the budget that will have to be paid for in wages and the quality of jobs, though the is a positive step in that direction. every year on routine expenditures than in North Vancouver and former either increased debt or, “more likely,” cuts panel found “there is no consensus on the While nobody particularly likes taxes, this one is likely a better one than the alter- they would under the old PST/GST. money columnist for The Vancouver Sun. to public services and programs. value and timing of those benefits.” native. So, we encourage you to please vote in favour of the HST.

18 outlook outlook 19 COVER

“If the referendum results in the end of the HST, If the HST is replaced, the marginal effective tax rate on the effect of shifting back to the PST will have a very capital rises to 28.8 per cent and the marginal effective negative impact on competitiveness.” tax rate on costs rises to 21.8 per cent from 18.5 per cent. Dr. Jack M. Mintz

is postponed indefinitely. B.C. will also and corporate tax system, the proposed purchasing power to buy goods and services slightly increase tobacco taxes and provide tax reform announced on May 25 if the with lower tax-inclusive consumer prices. a one-time payment of $175 for each child HST is maintained and the impact if B.C. The reduction in labour taxes will have some The tax impact of B.C.’s and senior (the payment is to be covered by returns to the PST. The marginal effective beneficial impact in encouraging employ- contingency funds). tax rate on capital is the annualized value ment and labour supply, although economic The tax impact of reducing the HST of corporate income, capital and sales studies do show that labour taxes are not as HST debate on investment and raising the corporate income tax is to taxes on business purchases as a propor- distortionary as taxes on mobile capital. reduce the marginal tax rate on labour but tion of the pre-tax rate of return on capital. On the other hand, B.C. is making its cor- increase it for capital. This is a worrying The marginal effective tax rate on labour porate income tax system less competitive, policy development since B.C. will shift is the weighted average of personal taxes, especially given the increase in the corpo- and competitiveness from a tax with less economic cost (the employer and employee payroll taxes and rate income tax rate on large businesses. The HST) to one that is more harmful to the sales taxes as a portion of the pre-tax cost of marginal effective tax rate on capital will rise This article1 is reprinted with permission from: economy (the corporate tax).2 Nonetheless, labour faced by B.C. businesses when pro- by 1.5 percentage points with a two-point the short-run impact of the proposal will viding additional hours of work to work- increase in the corporate income tax rate. Jack M. Mintz have only a slight negative impact on B.C.’s ers.3 I also compute the marginal tax rate The effect of raising corporate taxes in the Palmer Chair in Public Policy cost competitiveness. Over the long run, the on the cost of doing business – this is an long run is to reduce capital investment and School of Public Policy, University of Calgary higher corporate tax rate will reduce capital aggregation of taxes on capital and labour, the adoption of new technologies (which are investment, impair technological adaptation using the assumption that 30 per cent of typically part of new vintages of capital). and hurt productivity. It will be important labour taxes are shifted forward in negoti- Overall, the effect of the proposed f voters kill British Columbia’s Harmonized Sales Tax (HST) in a B.C. Premier Christy Clark’s government has introduced a poten- for B.C. to reduce the corporate rate back to ated labour costs. changes announced at the end of May by June referendum, the province’s economy will suffer in the long tially dramatic tax reform. Should the referendum fail to extinguish 10 per cent as soon as the budget balances. Reducing the HST rate from 12 to 10 the B.C. government on cost competitive- run. A rejection will spur the rebirth of the provincial retail sales the HST, B.C. will reduce its part of the HST rate from seven per The table below provides estimated per cent will lower the marginal effective ness is remarkably small in the short run, Itax, leading to steep increases in the marginal effective tax rates on cent to six per cent on July 1, 2012 and by a further point on July 1, marginal effective tax rates on capital tax rate on labour by about 1.1 percent- given our shifting assumptions (30 per cent capital and costs and a corresponding dip in investment and job 2014. The government estimates that each family will see a reduc- and labour for B.C. for the current sales age points since workers will have greater pass-through of labour taxes). The mar- creation. Should voters decide to keep the HST, B.C. will reduce the tion in sales tax payments equal to $470, more than offsetting the ginal effective tax rate on costs rises by 0.1 tax by two points over the next three years and raise the corporate estimated increase of $350 in sales taxes after replacing the PST. percentage points from 18.5 to 18.6 per cent. income tax rate to bridge the revenue gap. This will also negatively Given the revenue cost of reducing the HST rate, the B.C. Marginal Effective Tax Rates (METR) on Capital, Labour and The proposed changes will favour labour- impact corporate competitiveness, but since the government has government is raising the corporate income tax rate from 10 to 12 Costs in British Columbia under Various Tax Packages intensive industries that benefit most from indicated that the hike will be temporary, retaining the HST is the per cent for large companies on January 1, 2012. The small busi- reductions in taxes on labour (and lower best option for B.C.’s economy. ness corporate income tax elimination planned for April 1, 2012 wage costs). However, capital-intensive In the past week, I received a number of requests regarding the Current System PST at 7%, industries will be worse off. tax impact of British Columbia’s recent HST announcement on (HST at 12% HST at 10% GST at 5% If the referendum results in the end of competitiveness and in comparison to the re-adoption of the PST Dr. Jack Mintz is the Palmer Chair in Public Policy at the Univer- and Corporate and Corporate and Corporate the HST, the effect of shifting back to the sity of Calgary. He is a regular contributor to Canadian Business (“retail sales tax”) if the referendum succeeds. Below, I provide an Income Tax Income Tax Income Tax PST will have a very negative impact on and the National Post. Dr. Mintz held the position of Professor of evaluation regarding a new HST proposal in terms of its impact on Rate at 10%) Rate at 12% Rate at 12% competitiveness. The marginal effective tax B.C.’s cost competitiveness in comparison to the existing system and Business Economics at the Rotman School of Management at rate on capital rises to 28.8 per cent and the one in which the HST is replaced by the PST. the University of Toronto from 1989-2007 and in the Department METR on Capital marginal effective tax rate on costs rises to The B.C. proposal to reduce the HST rate by two points and raise of Economics at Queen’s University from 1978-1989. He was (Large Companies) 20.0% 21.5% 28.8% 21.8 per cent from 18.5 per cent. As docu- the corporate income tax rate by two points is far less harmful to President and CEO of the C.D. Howe Institute from 1999-2006. mented elsewhere, this will hurt investment the province’s economy than readopting the PST. If the new package Dr. Mintz has consulted widely with the World Bank, the Interna- METR on Labour 41.7% 40.6% 41.4% and jobs quite dramatically.4 helps convince B.C. voters to reject the referendum to extinguish the tional Monetary Fund, the Organisation for Economic Co-opera- B.C. Finance Minister Kevin Falcon in- HST, then this will be quite important to B.C.’s competitiveness. tion and Development, and the Government of Canada. METR on Costs 18.5% 18.6% 21.8% dicated that the corporate tax rate hike will

20 outlook outlook 21 COVER 2011 IT Forum. The future is yesterday. Are you on board?

be temporary – the rate would be reduced Not moving ahead with the planned into the small corporation.5 For this reason, to 10 per cent when fiscally possible. I do reduction in the small business tax rate has it is advisable that the B.C. government re- think that it is important for B.C. to return an ambiguous impact on competitiveness. evaluate its small business tax incentives to to the 10 per cent corporate rate as quickly Although the reduction in small business make them more growth-friendly and less as possible when the budget balances. Oth- corporate rates can reduce the cost of in- costly in revenue terms. erwise, it will be disadvantaged compared vestment, it increases a “taxation wall” that Overall, the B.C. government’s pro- to Ontario, Alberta and some other prov- impedes small business growth. Further, posed changes to the HST would not hurt inces for investment. Further, the revenue small business corporate reductions make it competitiveness in the near term, although increase will likely be eroded as large B.C. easier for those owners who use the corpo- a quick reversal of the corporate tax hike businesses shift profits to jurisdictions with rate form of business organization to avoid on large companies is highly advisable for lower corporate income tax rates. paying personal taxes on income shifted future growth.

1. I thank Duanjie Chen for assistance in evaluating the tax impacts. I appreciate comments received from three reviewers. 2. See B. Dahlby and E. Ferede, “What Does it Cost to Raise a Dollar of Tax Revenue,” C.D. Howe Institute Commentary, No. 324, C.D. Howe Institute, Toronto, March 2011. The marginal cost of raising one dollar of corporate income tax revenues in B.C. is estimated to be $11.64, the highest of any tax. 3. Marginal tax rates on labour are averaged over wage distributions for B.C. businesses. A fuller explanation of all these tax rate measures is provided in Duanjie Chen and Jack Mintz, “Federal-Provincial Business Tax Reforms: A Growth Agenda with Competitive Rates and Neutral Treatment of Business Activities,” SPP Research Papers, 4.1, School of Public Policy, University of Calgary, January 2011. 4. Jack Mintz, “British Columbia’s Harmonized Sales Tax: A Giant Leap in the Province’s Competitiveness,” SPP Briefing Papers, 3.4, School of Public Policy, University of Calgary, March 2010. Although my estimated investment and job impacts are larger than that of the B.C. panel that evaluated the tax reform, the difference is primarily related to the higher sales tax on capital goods that has been estimated from input-output analysis in the Canadian METR model for each province. 5. These concerns regarding the current structure of small business tax incentives are discussed in Duanjie Chen and Jack Mintz, “Small Business Taxation: Revamping Incentives to Encourage Growth,” SPP Research Papers, 4.7, The School of Public Policy, University of Calgary, May 2011.

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22 outlook congratulations

TO LEAD, Bring your Leadership Experience TO SERVE to the CGA-BC Board of Governors

We see more than numbers. CALL FOR NOMINATIONS

BOARD OF GOVERNORS > On May 26, 2011, five senior academics – three from the University of Northern British Columbia (UNBC) and two from Thompson Rivers ARE YOU, OR ANOTHER MEMBER YOU KNOW, INTERESTED AND QUALIFIED TO SERVE AS A LEADER University – were presented with their CGA designations at a special presentation in Prince George. ON THE ASSOCIATION’S BOARD OF GOVERNORS? Being elected to the Board gives members an op- Association Chair Bruce Hurst, FCGA, congratulated the five senior scholars on their accomplishment and spoke of the advantages gained when respected academics earn a professional accounting designation such as the CGA. portunity to be involved in the governance of the Association, providing strategic guidance on policy and issues related to education, branding and advocacy, regulation and protecting the public interest. Meet the academics who are B.C.’s newest CGAs

WHAT’S IN IT FOR YOU: WHAT YOU BRING AS A CANDIDATE: • A role in advancing the designation and serving • Leadership experience CGA plus PhD makes a the membership • Pride in membership and a demonstrated • First-hand exposure to the issues and chal- commitment to the CGA designation lenges facing CGAs powerful combination • A background in volunteering and community • A closer connection with the Association and involvment “All five of today’s CGAs have proven themselves leaders in the halls of academia,” said Hurst. “But by taking on the CGA program of the chance “to give back” studies, they have learned the ins and outs of accounting and finance, the core of everyday business. They have a new appreciation of • Integrity, accountability and a passion for the challenges CGAs and other accounting professionals face on the job, which can only benefit their research and teaching. Our new • Dialogue and idea exchange with a diverse excellence

group of CGA leaders and administrators > Today there are more than 10,000 CGAs in B.C. • The opportunity to expand your skills and your network

There are fi ve vacancies on the CGA-BC Board of Governors for 2012. Four are in the Lower Mainland Region (District 1) and one in the East/West Kootenay Region (District 5). All vacancies are for terms of three years each. A candidate MUST reside in the electoral district for which he or she is nominated.

NOMINATION FORMS: Nomination forms are available to members in the following ways: 1. On the website at www.cga-bc.org. NOMINATION Click on the Nomination Package icon on DEADLINE: the home page. In accordance with the Bylaws, nomination N forms must be submitted Nomination Form to the Secretary no later than: 2. CGA-BC will email a link to the nomination 4:30 p.m. on Friday, form in PDF format to all members whose July 22, 2011. e-mail addresses are registered with the Association.

outlook 25 conference_ad_Outlook.pdf 1 08/06/11 1:18 PM

“There is little doubt that having more academics become CGAs is an important development for the designation. When academics pursue and obtain a professional accounting designation it helps raise the profile of the accounting profession as a whole.” Bruce Hurst, FCGA, Association Chair

CGAs have also enhanced the ties Civil Engineering in Romania, and sor of Finance at UNBC. He teaches Dean Drysdale, PhD, CGA, is between their institutions and the later earned an MBA from Simon finance and international business currently a Professor of Business largest accounting body in the Fraser University and a doctorate and he is currently bringing the Management at Kwantlen Polytech- province. We still have much we can in business administration (DBA) Principles of Responsible Manage- nic University. learn from one another.” from St. John’s University in New ment Education – a United Nations York. He has developed strong core initiative – to business students. His Karel Hrazdil, PhD, CGA, is Assis- Hurst was joined by Bill Johnson, competencies in leadership and research interests include corporate tant Professor at Simon Fraser Uni- FCGA, Director, Education & Student organizational change, corporate finance and sustainability. He com- versity’s Beedie School of Business. Services, and presented CGA certifi- finance, corporate governance, pleted his DBA at Nova Southeast- cates to the following academics: corporate social responsibility, inter- ern University in Florida in 2006. Tanya Tang, PhD, CGA, is a an national relations and cross-cultural Assistant Professor with the Faculty Han Donker, PhD, CGA, Univer- management. Murray Young, PhD, CGA, of Management at the Univer- sity of Northern British Columbia Thompson Rivers University sity of British Columbia-Okanagan Dr. Han Donker is the Chair of the Bita Mashayekhi, PhD, CGA, Dr. Murray Young is Dean of the campus. School of Business at UNBC. He University of Northern British University’s School of Business and earned a PhD in finance and ac- Columbia Economics. He earned a BA from counting from Tilburg University in Dr. Bita Mashayekhi recently joined Bethel College, an MSBA from the Netherlands and an MSc in eco- UNBC’s School of Business as an Indiana University and a PhD from nomics from the Free University of Assistant Professor of Accounting. Ohio State University. His research CGA-Canada established the Senior C Amsterdam. He is a member of the Her research analyzes how different interests include marketing strategy, Academic Program to recruit Royal Netherlands Institute of Reg- aspects of corporate governance international business, organization qualified business and accounting M istered Accountants. Prior to joining influence firms’ performance and and household buyer behaviour, academics into the ranks of the Y UNBC, he initiated a new master’s financial reporting. She has exam- and management education. Association. The Program makes it CM degree program in financial law at ined board of directors’ characteris- possible for post-secondary faculty Erasmus University in Rotterdam. tics as the cornerstone of corporate to earn the highly respected CGA MY

governance. In this research she These new members join the fol- designation. Senior academics who CY Mike Ivanof, DBA, CGA, explored the influences of board lowing academics who were admit- have a CGA designation contribute Thompson Rivers University composition, board size and board ted into CGA membership during to the profession and the CGA As- CMY Dr. Mike Ivanof is Director, Academic independence on the quality of the past two years: sociation in several ways, including K Program Development and Instruc- earnings reported by public firms. participating in research and public tor for The Management Centre Joy Begley, PhD, CGA, is Associ- policy initiatives, providing instruc- at Thompson Rivers University. Alex Ng, DBA, CGA, University of ate Professor in Accounting at the tional or marking support, getting He completed a BSc in engineer- Northern British Columbia Sauder School of Business at the involved in various committees and ing at the Technical University of Dr. Alex Ng is an Assistant Profes- University of British Columbia. promoting the CGA designation.

> From left: Mike Ivanof, DBA, CGA; Han Donker, PhD, CGA; W. D. (Bill) Johnson, FCIS, PAdm, FCGA, Director of Education & Student Services; Murray Young, PhD, CGA; Bruce Hurst, FCGA, Association Chair; Alex Ng, DBA, CGA. Not pictured, Bita Mashayekhi, PhD, CGA.

26 outlook Canada’s Accounting Standards Oversight Council supports Canada’s Accounting Standards Board resources, courses and

and the Public Sector Accounting Board as they develop internationally accepted standards. tools of the trade >

Top right: publicpracticeEdifier Past President and Chair John Nagy, FCGA practiceUpdate

ou wouldn’t think that standard members drawn from business, finance, and SMPs. There was a lot of talk over basically were a slimmed down and less CGA-BC Practitioners – You’re setters and the police have much government, academe, the accounting the years about standards overload, that complex version of Canadian Generally invited to the 2011 APPM in Victoria in common. But both aim “to and legal professions, regulators, and the standards were becoming more complex Accepted Accounting Principles (GAAP). The September 22, 2011 Annual Public Yserve and protect” – to serve and financial analyst communities. The mem- every year because of all the things going Practice Meeting is your opportunity to protect their stakeholders and the public bers are usually chosen for their broad on in the public company forum. There IFRS vs. Private Enterprise Stan- connect with colleagues and participate at large. That same goal prompted John perspective on the complex issues facing was this philosophy that if standards were dards in roundtable discussions about topics Nagy, FCGA, a director and shareholder of standard setters and the communities good enough for Enron, they were good Given that Canada has now converted such as: Reid Hurst Nagy Inc. – one of B.C.’s largest they serve. enough for Joe’s Bakery. So, although to IFRS, does he think that the country • converting to a paperless office, CGA firms – to join Canada’s Accounting not all private enterprises needed to be might also ultimately adopt IFRS for • determining and meeting clients’ needs Standards Oversight Council (AcSOC) five CGAs on the AcSOC audited, any company that did so had to small to medium-sized enterprises and expectations for additional services, years ago. Nagy says he was invited to join the group have its financial statements prepared ac- (SMEs), which were released a few years • succession planning, “Anything that is done at the standard- because of his long years of service to the cording to the same accounting standards ago? • changes in accounting and auditing setting level directly affects me, as a public profession, which culminated in serving as that the large multinational corporations “We originally looked at those stan- standards, and practitioner, and my clients. When I was President of CGA-BC in 1999 and Chair of used. It just didn’t make any sense. I was dards when we decided to move to IFRS • keeping up with and utilizing technol- hoping to provide some input, to help to see if they would work for us,” Nagy effect change. The timing was perfect says. “If IFRS for SMEs had been ready, ro- ogy. Join us for an interactive morning Past President John Nagy, FCGA, discusses his work on the Accounting Standards because Canada was just then starting to bust and met our needs, we might have providing information, motivation and Oversight Council make a decision on International Financial gone there, but in 2006 they were in the Reporting Standards (IFRS) and it became early stages. We did not know if they networking opportunities. Register for very evident that we needed to make would be ready when we needed them. this event at www.cga-bc.org. The Past, Present and Future of Accounting a decision on where to go with private So we decided to go it on our own.” Standards in Canada enterprises as well.” And that might be best for the time Nagy makes it very clear that his in- being. “From an accounting perspec- By Gundi Jeffrey volvement in the standard-setting process tive, we treat our small businesses very Deadline for Public Practice Advisory is in an oversight capacity only. “I’m not differently than other countries do. For Group Nominations is October 14 advising clients on how to prepare their CGA-Canada for the 2003-2004 term. a technical standard-setting person. But example, many countries, especially in Members in public practice who wish to financial statements, I was working with “CGA-Canada is entitled to designate AcSOC does have considerable input into Europe, require every company to have volunteer for the 2012 Public Practice Ad- accounting standards that were, in the two CGAs to the AcSOC. They chose me the standard-setting process.” an audit. In Canada we don’t, although visory Group (PPAG) are invited to submit view of many small practitioners, driven by because my profile as a practitioner in a we have made provisions for private their names for consideration. The PPAG the needs of large, multinational, public small to medium-sized practice (SMP) fit Regulators Working Together companies to choose their level of advises the Director of Public Practice on companies and then pushed downwards. their needs better than that of the other Nagy also says the Council receives assurance on their financial statements matters relating to the practice of public But for the smaller, owner-managed candidate being nominated at the time. information from the boards on what depending on what the users of those accounting and the policies regarding private enterprises I was working with, They also recognized that I was comfort- they have been doing. “We approve their financial statements need.” registration and operation of public those standards seemed excessive. Joining able working at the board level because strategic and annual plans. For example, In any case, Nagy points out, Canada accounting practices. In addition, this AcSOC gave me an opportunity to provide I had been doing that for more than 25 we approved AcSB’s strategic plan in has decided on a five-year cooling-off group recommends policies to ensure input to the standard-setting process years. And I was relatively outspoken with 2006 when the board decided to go with period, during which there will be no that the public interest is adequately and perhaps help change things for such my opinions. If you just sit back, no one IFRS. And we monitor and evaluate their significant changes to accounting stan- protected. clients.” will notice you.” performance in achieving the goals and dards. “There may be some tweaks but You are eligible to volunteer for the Nagy reiterates that his prime motiva- objectives they have set for themselves they won’t be significant.” Role of the AcSOC tion for joining AcSOC was to improve to ensure that they are going in the right PPAG if you are a CGA-BC member engaged or employed in the practice of The Canadian Institute of Chartered Ac- the situation of private sector companies. direction and that all stakeholder interests Changes to Not-for-Profit Standards countants established the AcSOC in 2000 “I wanted to be involved in something are being looked after.” Public sector accounting standards public accounting. Criteria for selection to oversee the activities of Canada’s Ac- that made sense for private enterprises “The AcSB obviously met its 2006 goals,” have, however, moved to the forefront are partially based on regional represen- counting Standards Board (AcSB). In 2003, he says, “in that IFRS was implemented of the AcSOC’s radar screen, which Nagy tation, as follows: three candidates from the Public Sector Accounting Board (PSAB) and up and running as of 2011. To convert describes as “much tougher to deal the Lower Mainland, one from Southern also came under its control. AcSOC now Gundi Jeffrey, a freelance business a country’s accounting standards to a with.” Vancouver Island, and two to represent supports both boards as they develop journalist and editor now living completely different set of standards is a Public companies are required by law the balance of the province. Please internationally accepted standards and in Mexico, was the co-founder of huge undertaking and they did a terrific to adhere to Canadian GAAP – whatever submit your Advisory Group Application annually reports to the public on their The Bottom Line. Her articles ap- job with it.” And the AcSB also fulfilled it is – but the country’s governments Form by October 15 to Brigitte Ilk, CGA, performance. pear in accounting publications in his wish, developing and implementing have no such prescription. “For govern- Manager, Public Practice Research and The Council has between 20 and 25 Canada, England and Mexico. standards for private enterprises, which ment, you first have to develop the Development, at [email protected].

28 outlook outlook 29 standards and then you have to sell CGAs are accomplished professionals. In this feature, we highlight members who land major new them.” Nagy adds that B.C. was the first province to use Canadian GAAP jobs, get promoted or achieve significant professional success. Please share your news with us. for the public sector, as established by the PSAB. Get A True There is also the issue of compet- ing interests. As an example, Nagy Investment Professional cites federal transfers to provincial governments. “You’ve got the feder- al government giving money to the On Your Team provinces and the provinces receiv- ing it, but the accounting treatment for the same transaction by the two governments is very different. When the feds make the transfer, With interest rates near historical lows they’ve spent the money and they want to treat it as an expense. But and continued economic uncertainty the province might not use the in global markets, effectively managing money right away, or it will spend your assets can be a daunting task. Let it over a period of years. If all the keepingTabs transfers are immediately recorded a true professional manage your or your as revenues, deficits will arise in the > > clients’ investments. At Zadra Wealth following years. So, that’s one type from 1972 to 1978, he For the past 13 years, Mr. Li of conflict of interest that needs to continued to serve on the was a senior auditor with the Management you will benefit from: be addressed.” CGAs in the Education Advisory Group Members on the B.C. Ministry of Finance. The AcSB is also in the process News from 1970 to 1974 and Move Steve Zadra, BBA, of developing a unique set of stan- again from 1981 to 1997. Fern Mitchelmore, CGA, CGA, CFP, CIM • An experienced portfolio manager – dards for not-for-profit organiza- The Mission Business and He became a member of Bill Smyth, FCGA, was has been appointed Execu- Senior Vice President specializing in income generating port- tions in the private sector. These Professional Women’s the Quarter Century Club recently elected as Vice-Chair tive Director of CGA New- Club awarded the 2011 in 1978 and a Member foundland and Labrador. & Portfolio Manager folios as well as income and growth standards were not part of the of the Queens Community HSBC Securities strategic plan that ushered in IFRS. Myrtle Evertt Woman of Emeritus (50 years of mem- Health Board, a volunteer (Canada) Inc. portfolios. And an even larger issue is what the Year Award to Ann bership) in 2003. organization acting as a voice Correction the roles of the AcSB, PSAB and Ac- Senae, CGA, of Mission, of the community to the The recent Spring issue of SOC will be going forward. “AcSOC B.C. on May 11. Ms. Senae In Memoriam – Harold B. • Cost effective investment Provincial Health Authority. Outlook included a list of is currently evaluating that very is a public practitioner and Stringer, FCGA, died on Bill continues as President of donors to the CGA-BC Edu- management question. We do know that Canada she has served with many March 21. Harold was a OnPayroll.ca Corp. cational Foundation in 2010. has a large role to play internation- non-profit groups in Mis- member of the Associa- The list did not include dona- • Extensive knowledge of registered ally. Standard setting is profession- sion, including the Valley tion’s Board of Governors Irina Plavutska, CGA, has tions from Stephen Spec- ally done in only a few countries, so Women’s Network, the products – IPP RRSP, RRIF, TFSA, LIF. been appointed Interim CFO tor, FCGA, and from Reid we’ve been very actively involved in Women’s Resource Society, of Prophecy Resource Cor- Hurst Nagy Inc., Certified the development of IFRS, and that the Hospice Society and • Diverse linguistic resources – poration and Joseph W. Li, General Accountants in the will continue. Our domestic role the Chamber of Commerce. CGA, is the company’s new $1,000-$1,999 category. We We speak English, Mandarin and will change so that there will be General Manager and Corpo- apologize for this omission. Cantonese. less standard setting at the public In Memoriam – Kenneth rate Secretary. Ms. Plavutska company level but much more Weaver, FCGA, the Asso- earned a master’s degree monitoring of what is being done at ciation’s President in 1975, in economics from the We appreciate your the international level to make sure died on May 15. In 1976 University of Business and contributions to ‘Keeping Contact Zadra Wealth Management today that IFRS works in Canada.” he was awarded a CGA Economics in Ukraine, and Tabs.’ If you would like to and get a true investment professional on your team. There are plenty of issues still to Fellowship and in 1984 he she has held senior account- submit news or updates be resolved and CGAs need to be became a Life Member. ing positions at numerous concerning yourself or We service all of British Columbia. part of that process. Nagy’s second In addition to serving on Canadian international and a CGA you know, please term on AcSOC ends in March 2012 the Board of Governors professional service compa- email the details to: and the Council will be looking for nies for the past several years. [email protected]. Zadra Wealth Management another CGA to replace him. and served on both the HSBC Securities (Canada) Inc. “If you’ve made the rounds in Public Relations and the 885 West Georgia Street, 11th floor various volunteer positions at Honours and Awards com- mittees. In recognition of Toufic (Téo) Dina, CGA Vancouver B.C – V6C 3E8 CGA, whether at the provincial or federal level, and have an interest in his contributions to the Mortgage Advisor Tel: 604-623-3256 standards and how they influence Association and to the pro- Toll Free: 866-858-4722 our professional lives, this might fession, Harold was made Email: [email protected] be an opportunity for you. Whom a Life Member in 1981 and ORIGIN Website: www.stevezadra.ca he received his CGA Fel- HOME FINANCIAL PARTNERS you know and what your profes- sional resumé looks like will open lowship from CGA-Canada Origin - SP Seal Mortgage Corp. the door, but it’s your interest in in 1991. He became a the future of the profession and member of the Quarter P: 778 - 230 - 9059 A CGA for mortgage advice how it operates that will make the Century Club in 1977 and a F: 604 - 677 - 5953 HSBC Securities (Canada) Inc. is a wholly owned subsidiary of, but separate entity from, HSBC Bank [email protected] Canada. Member-Canadian Investor Protection Fund. difference.” Member Emeritus in 2001.

outlook 31 From a standalone perspective the iPhone and iPad are both revolutionary devices. Accordingly, it’s no wonder there are so many clever new add-on gadgets that increase the functionality of these devices. In this issue we feature several gadgets, an App and a new service by Apple.

7.50 UK

Camera $399.95 US 8 GB wireless memory card $149.95 US

Base Unit $19.99 US $19.99 US iPhone 4 adaptor $4.99 US $59.99 US $139.95 US $49.95 US/Month $149.95 currentAssets By Trevor Hargreaves

GADGETS

> > > > > > Digital Luggage Scale Wireless iPhone Charger iPad Keyboard Case Leaf Tie 3D video Camera their computer or iPad, this is a a diagnostic computer, which is Coming soon As airlines increasingly This futurist device harnesses the One of the great limitations of Now here’s a new take on “green- This nifty device captures video in must have app. It allows the user territory traditionally held specifi- lower the accepted weight power of induction to enable the iPad is that touch keyboard ing up the office”. true stereoscopic 3D video. Im- to add a high level of encryption cally by your mechanic. It allows iCloud of checked baggage, this wireless charging. Simply place functionality simply isn’t as fast suck.uk.com ages are recorded at 640x480 pixel to saved files and emails and you to check fuel efficiency, Steve Jobs appeared at a recent device becomes all the more your iPhone on the “power tray” as the tactile keys of a traditional resolution as native AVI files. The disable them remotely should the horsepower, torque, and perhaps Apple event to debut the necessary. This small, portable and the charging process begins. laptop. This limits usage of the > add-on 4GB SD card stores up to 4 device become lost. most importantly, check and upcoming iCloud service which device weighs bags up to This certainly beats fiddling device for users in need of rapid Exterior Pocket Impervious hours or 2000 still 3D images. www.watchdox.com reset engine codes. The price-tag will makes use of cloud comput- 100lbs, and features an easy to around with the connector port note taking, transcribing minutes, Carry On www.hammacher.com may seen a little high, but I spent ing trends, but aims the features read digital display. With this and cord on the standard charg- and anything that requires quick The great design feature of this > $85.00 at my mechanic’s just a specifically towards media files. device you can stay aware of ing system. The base model is typing. This add-on Bluetooth luggage is that it’s built of a APPS Kiwi Bluetooth Car Diagnostic few weeks ago to have him check This service will soon allow users exactly how much weight you compatible with the 3G and 3GS keyboard does much to remedy strong, lightweight composite App for Android these very same features using to integrate both apps and con- are carrying making it much iPhone models. It’s also compati- this situation, and also features a material, yet features a foldout ex- > This gadget allows you to con- the garage computer. For the tent at a remote location. This easier to avoid those irritating ble with the iPhone4, but requires built into a protective case which terior pocket. This makes it both WatchDox Document Security nect your phone to your car via savvy user, this could pay itself off will enable streaming service to extra-weight fees. an additional adaptor. encloses both keyboard and iPad. accessible and super durable. For anyone that stores sensitive the vehicles OBDII port. It en- very quickly. any variety of devices such as an thinkgeek.com thinkgeek.com thinkgeek.com www.hammacher.com or confidential work-files on ables your phone to function as www.the-gadgeteer.com iPhone, iPad, laptop or iPod.

32 outlook outlook 33 New members of the Quarter Century Club

More than 200 Quarter Centurions honoured for careers dedicated to excellence 2011 Quarter Century Club

“Where have the last 25 years with a presentation by Club members represent gone?” It was a question on Bruce Hurst, FCGA, Chair of only a small sample of the As- the minds of many who at- the Association’s Board of sociation’s more than 10,000 tended the recent meeting Governors, who appropriately active members, but their of the Quarter Century Club recalled the importance of personal and professional on May 13, 2011. The popular adding those three simple achievements are a testament annual event celebrates letters after each member’s to the tremendous reputa- and honours the men and name. “Twenty-five years ago tion that CGAs enjoy in B.C. women who have achieved – or in some instances, 50 The evening honoured and 25 years and, in some cases, years ago for our Members’ celebrated the newest Quar- 50 years of active CGA mem- Emeriti – each of you walked ter Century Club and Half Top left: 50 years of CGA membership: Centre left: Quarter Century Club Chair Bill Bottom left: Gail Perkins, CGA, bership. This year, 216 CGAs across the stage at Convoca- Century Club members for (standing from left to right) Clem Haziza, Schulz, CGA, welcomed more than 130 new QCC receives her QCC award from CGA-BC qualified to join the celebrat- tion and received your CGA their outstanding service and CGA; Anthony Mise, CGA; (sitting from members and their guests to the awards gala in Chair Bruce Hurst, FCGA. ed 25-year club, another 17 designation,” Hurst told the contribution to the account- left to right) Edward Turner, CGA; Chris Vancouver and presided over the Club’s annual qualified for the 50-year club, members. “That singular ing profession. “We belong Trunkfield, FCGA; and Henry Benjamin, general meeting. Bottom right: Moe Jones, FCGA, and many of them gathered achievement opened up a to an incredible Association CGA. CGA-BC Educational Foundation at the beautiful Sutton Place whole new world of opportu- and you all deserve special Centre right: Sophie Lui, co-host of the Global representative and CGA-BC Past Chair, Hotel in Vancouver to mark nities, on both a personal and recognition for upholding Top right: CGA-BC Board Member David BC Morning News, served as master of ceremo- provided an update on the Foundation their achievement. a professional level.” the values and ideals we hold Sale, CGA, (left) receives his QCC award nies and shared a few highlights about what each and spoke about the importance of The awards gala began The new Quarter Century dear,” Hurst said. from CGA-BC Chair Bruce Hurst, FCGA. member had achieved during the past 25 years. giving back.

34 outlook outlook 35 casestudy partingshot

In each issue of Outlook, we profile a member or CGA student who is helping to build the CGA brand. This month we spoke with Shanalisa Keller, CGA Financial Controller at Quicktech Computer Consulting How one company used social media By Patrick Schryburt and Trevor Hargreaves to achieve a specific objective

Can you briefly describe However, with our services What issues concern you program so I had a support Quicktech Computer Consulting Inc. is a privately your role with Quicktech? in particular, despite market the most, personally and/ network already in place. held company that provides IT services to small and medium- My official title is Financial competition there is an or professionally? Finally, having a CGA designa- sized businesses as well as residential clients. Recently, it won first Controller; however, my po- overall sense of commu- Globally, I am concerned tion qualifies me for an array prize in the “Best Company” category of Small Business BC’s Suc- sition also includes human nity amongst the compet- about the degradation of of careers – I am not limited to cessful You competition. This competition, sponsored in part by resource manager, collec- ing companies. There are our environment and the a certain role. tions officer, payables clerk various open-knowledge sort of earth we are creating CGA-BC, included social-network voting as one component of its and tax consultant. Needless forums and organized for the next generation. I Do you have a personal judging process. Shanalisa P. Keller, CGA, the Financial Controller to say I am never looking for events where competing feel that increased in- mantra? at Quicktech, shared some highlights of the social media strategy something to do. Most re- companies trade ideas with frastructure needs to be Three things will last forever – the company used for this competition. cently I facilitated the office each other. There is a certain put in place to support faith, hope, and love – and the “Quicktech was looking to start its first marketing push and renovation and redecorating sense of mutual respect that environmentally conscious greatest of these is love. we felt this contest would be a great way to get our name out so I guess interior designer I have not found with many practices. Nationally, I there,” Keller says. “We needed a social media networking plan that applies too. other industries and it is am concerned about the What are your favourite would not only generate online traffic for the contest, but also act very refreshing. mental health of Canadians. hobbies as a tool to drive new campaigns as well.” What do you enjoy most I notice fewer people taking Camping (RV style), dirt biking Their first step was to develop the page where people would about your job? Why did you move from care of themselves and with my husband and kids, come to vote for them. “We wanted to stand out so we added a The people I work with public practice to work- an increasing number of decorating, entertaining and YouTube video,” Keller says. They made sure to create the video in and the diversity of my job ing for a company in the people who are anxious and travelling. a generic way so that they could use it for future campaigns. description. tech sector? challenged to cope. I am Their next step was to use the email marketing website Con- It was not so much the tech generally a more positive What’s the last good movie stant Contact to communicate with their existing clients. “By using What are the key success sector that was alluring, but person, but these are two you saw? Good book you this professional site rather than our regular email program, our factors for your business? rather the small business issues that greatly affect me read? messages were much less likely to be caught by a spam filter,” We genuinely have our cli- aspect of Quicktech. My skill both personally and profes- How about all-time favou- Keller says. Additionally, they were able to track vital statistics such ents’ best interests at heart set and ideas are unique sionally. rites? Movie – Pretty Woman. and strive to find solutions within the team. How diffi- Book – The Shopaholic Series as how many people opened the email and how many people that will serve them best. We cult was the transition? Well, What do you like most by Sophie Kinsella. Not very clicked on the voting link. They added an attention-grabbing title are largely occupied with I must admit that I miss the about accounting as a deep, I know, but life is oth- to the email and created a link directly to their desired web page. creating and implementing adrenaline rush that April 30 career? erwise fairly intense for me. I Their final step was to reach out to as many new people as processes that automate brings to the tax group of a I have enjoyed working with like books and movies to be possible, in order to drive the voting process. “This is where we and streamline work, which public practice firm. numbers ever since I made an escape. really took advantage of the true power of social networking,” reduces our overhead and the choice back in high says Keller. At its core, social networking is driven by the sharing saves our clients money. Do you manage staff? If school to pursue this career. What’s the secret to and contact between friends. And the biggest place to do this is We invest in systems that so, what are the secrets As an accountant I am well achieving good work/life Facebook. are modular and scalable to getting the most out of equipped to serve in many balance? After creating a Facebook page for their company, they with our growth, and we are talented people? different roles and work with The secret is deciding what then asked people to “like” the page. The process of “liking” an constantly aware that we I currently do not have any numbers in many different work/life balance looks like item keeps it dynamic and also on the main newsfeed page of need to adapt to changing employees that directly re- ways. for you (and your family, if Facebook, therefore keeping that item visible for much longer. In market conditions by evalu- port to me, although I work applicable) and having the addition to Facebook, they also used Twitter as well as dynamic ating and re-evaluating our closely with a very talented Why did you choose CGA self-discipline and self-respect blogging on their site. Keeping information fresh drove people to services. management team. I feel for your professional to stick to it. Since I have had view it more and more often. the only way to work well designation? kids I have always worked less The result of all this was an amazing turnout in voters for the How competitive is B.C.’s together is to collaborate I chose the CGA program than full time (in varying de- company. “More than that though, it created a ‘buzz’ about our tech sector? and have open communica- for several reasons. One was grees). This decision has come Some aspects of B.C.’s tech tion with the intention of the program’s flexibility and with financial sacrifices and company,” Keller says, “and it led to new clients and more calls sector are certainly more finding solutions or reaching the ability to work while my career has not advanced from current ones.” Quicktech’s strategy required an expenditure competitive than others, goals. Ultimately, respect taking courses. Another was as quickly, but I don’t regret of time, but very little financial investment, proving that social particularly in the residential needs to be the prevailing that I had family members the extra time with my kids media can be used successfully to have a maximum impact on and computer retail sectors. sentiment. and friends go through the and husband. marketing.

36 outlook outlook 37 morethanNumbers

We see the pressures of a global economy.

THE FASTEST GROWING DESIGNATION IN B.C. DEMOGRAPHIC CRUNCH Number of B.C. students Number of students who Ratio of people of work- who registered for the first registered in the most re- ing age (20-64) in Canada year of the new CGA edu- cent completed academic per person of pension age cational program in 1951: year (2009-2010): (65+) in 2010: FORGET MANSIONS, JETS, YACHTS AND FINE 95 933 4.6 ART Projected old-age support Price paid by a Chinese buyer at an auction in BURNING AND A TAXING PLANET ratio in 2050: January 2011 for a pedi- SHREDDING Value Added Tax 2.1 greed Belgian racing pi- Price paid by CGA-BC to (VAT) rate in Australia: geon named Blue Prince: purchase its office build- 10% ing at 1555 West 8th $200,000 VAT rate in France: WEST COAST SURFING Percentage of all Cana- Price paid for a six-litre 19.6% dian households with bottle of Cheval Blanc VAT rate in the U.K.: Internet access at home: 1947 sold at an auction in 20% 79 November 2010: VAT rate in Sweden: $304,375 25% Rank of B.C. in terms of home Internet access HST rate in B.C.: Price paid for a 324kg among all Canadian prov- bluefin tuna, caught near Avenue in Vancouver in 12% inces: Hokkaido, Japan and sold 1975: Projected HST rate in B.C. 1 at an auction at Tokyo’s $535,000 in 2014: Tsukiji central fish market 10% in January 2011: nearly Years it took for the $400,000 Association to pay off the mortgage: Member price for the 10 full 2011 CGA confer- ence package: Price paid by $1,199 CGA-BC to purchase its own office Market value of Apple Inc. building at 1867 at the close of trading on West Broadway in 2001: June 3, 2011: $5.2 million $317.6 billion Years it took for the Combined market value Association to pay off of Microsoft and Intel on the mortgage: the same day: cga-bc.org 10 $316.8 billion

Sources: CGA-BC archives; hstinbc.ca; Statistics Canada; OECD (2011), Pensions at a Glance, OECD Publishing; Wall Street Journal; Mobile Computing News.

38 outlook But it’s who you know that really counts She came to us. Shouldn’t you?

604-682-8367 1800 - 777 Hornby St., Vancouver www.angusone.com