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TORONTO, July 17, 2022 – By far the biggest business event of the week was the Bank of Canada’s surprise decision to step up its interest rate hike campaign because Canadians are “worried about increasingly that high inflation is here to stay. Instead of the three-quarters of a percentage point forecast by most economists, the Bank of Canada raised the benchmark rate by a full percentage point to 2.5%, which was even higher than those lofty expectations.
Inflation and supply chain concerns were already the top two obstacles to growing the economy, as Canadian accountants reported in the CPA Canada Business Monitor Q1 2022. Don’t expect to a lot of change, aside from the risk of a recession, in the second quarter of 2022. And now, on to the rest of last week’s news in Canadian accounting.
Tell us how you don’t cheat, Big Four
It’s never a good thing when an international news agency checks you into a negative story. But on Friday, Canada was mentioned as another culprit for cheating practices in internal reviews of the Big Four accounting firms. In UK accountants must show how they prevent exam cheatingCanada is mentioned alongside the United States and Australia as being the target of sanctions for cheating by regulators.
Earlier this year, PwC Canada was fined over C$1 million by US and Canadian regulators when the accounting firm Big Four voluntarily disclosed to regulators that its employees shared their answers during mandatory internal training courses. Now the Financial Reporting Council, which regulates accountants in Britain, has sent letters to major accountancy firms and accountancy associations asking what controls they have in place.
KPMG leaves the island as part of the latest Quebec acquisition
The most interesting battleground province for accounting firms over the past two years has been Quebec. And why not? Its economy is strong and diversified. It has a large public sector and a culture of SME entrepreneurial success. It is therefore not surprising that KPMG last week acquired Fournelle Marion Beaudoin Trussart, otherwise known as FMBT, in the suburb of Montreal known as Terrebonne.
This new acquisition is the most recent in a series of acquisitions initiated in 2018 to extend the KPMG brand to all of Quebec. The Big Four firm competes with MNP, which entered into a blockbuster deal with Deloitte Quebec in 2021, and one of the strongest French-speaking accounting brands, Raymond Chabot Grant Thornton, itself the result of a merger in 1998 , with more than 100 offices across the beautiful province.
Microsoft is backtracking on blocking VBA macros on downloaded documents by default. The news was first announced by BeepComputerwho explained that VBA macros are a popular method for spreading a wide range of malware strains, and cybersecurity experts were pleased with this decision.
Apparently there’s been a lot of pushback from unspecified stakeholders, but Microsoft is keeping mum on the subject. The software giant says it still plans to block VBA macros in the future, but will temporarily suspend its plans.
Canadian Press reported this week that thousands of tech workers were laid off in the second quarter of 2022 – but are quickly being taken over by established players. That includes accounting software provider Intuit Canada, which plans to hire 250 people in the next fiscal year.
“Some (workers) are looking for more meaningful roles or you’re in small startups that… don’t have the stability and you’re hitting an economic bump like the one we’re going through right now, so suddenly their jobs are redundant,” said David Marquis, national director of the company.
Outgoing financial controller latest to report concerns over Charlottetown’s finances and review process (Radio Canada)
Taxpayer relying on information on CRA website faces penalty for overcontributing to TFSA (Financial item)
Canadian Muslim charity asks Supreme Court to review CRA suspension (World News)
Opinion: Before leaving, Kenney needs to clear a stain on his tax record: slice creep (PostMedia)
Global tax deal jeopardized by Manchin’s waiver of minimum corporate levy (Policy)
Will Canada go it alone with a digital tax? (Policy)
EY’s breakup plan could lead to lead industry upheaval (Accounting age)
Taxes and spending: Worries about tax cuts at the pumps are so futile (Globe and Mail)
Inside Amazon’s strategy to protect its profits from Canadian taxes (Globe and Mail)
BC speculation tax brings 20,000 units back to rental market (Globe and mail)
By Canadian accounting staff.