Not-for-profit financial reporting standards

If you´ve been following the evolution of accounting standards throughout the past couple of years, you know that the Accounting Standards Board (AcSB) Strategic Plan recognized that financial reporting standards for not-for-profit organizations needed to studied further, to understand the sector´s needs in more detail and to gather feedback about how best to meet those needs.

On January 5 the AcSB and the Public Sector Accounting Board (PSAB) released an Invitation to Comment (ITC) that canvasses the issues and asks for answers (by June 30th, 2009) to the following questions:

1. Should financial reporting for not-for-profit organizations be closely linked to GAAP standards for other sectors, or should an additional set of national standards for not-for-profits be developed?
2. Should all not-for-profit organizations follow one set of standards? If so, which standard is best?
3. Alternatively, should different options be available to not-for-profit organizations, based on users´ needs, and should guidance be developed to narrow the options?

For a link to the ITC, click here.

Stay tuned to Inside Internal Control for more news. And you can be confident that the new financial reporting standards for not-for-profit organizations will be integrated in Not-for-Profit PolicyPro in the months to come through the regular update releases.

<< Top of Page

Fixing the recession

Now that it´s acknowledged that Canada is in the midst of a major recession, it´s time to look for strategies to climb out of it. With this in mind, the Conference Board of Canada has released a briefing that analyzes the macro-economic options available to governments and offers more detailed advice on Canadian fiscal policy.

Click here to link to the Conference Board sign-in page.

Note: If you are not a registered user of the Conference Board of Canada´s e-Library, you will need to register, as follows:

1. Click Create an account
2. Follow the on-screen directions to complete your registration

<< Top of Page

Design of greenhouse gas cap-and-trade system

As we reported Vol 1, Issue 5 of Inside Internal Control, the Ontario and Quebec governments have signed a Memorandum of Understanding to establish a joint greenhouse gas cap-and-trade system. And the consultative process has begun with a discussion paper that outlines the intentions and proposed details for the regime and invites interested parties to comment.

For more information, including a link to the discussion paper and presentations from the December 10th launch of consultations, click here. And for analysis by Laura Zizzo of Gowling Lafleur Henderson LLP, click here.

Operations & Marketing PolicyPro (OMPP) includes a policy on Greenhouse Gases and Emissions Trading that includes an in-depth overview of the subject as well as a ready-to-use model policy. For more information on OMPP, click here.

<< Top of Page

CRA access to electronic records outside Canada

A November 7th ruling by the Federal Court of Appeal in eBay Canada Ltd. v. Minister of National Revenue will compel eBay Canada to produce information relating to "power sellers", clients who generate a high volume of sales.

eBay Canada claimed that the electronic records resided on servers outside Canada and thus fell under the protection of "foreign-based information" according to section 231.6 of the Income Tax Act.

The Federal Court disagreed. In a unanimous decision, the judges claimed that "with the click of a mouse, the appellants make the information appear on the screens on their desks in Toronto and Vancouver, or anywhere else in Canada....Hence, it makes no sense...to insist that information stored on servers outside Canada is as a matter of law located outside Canada for the purpose of section 231.6 because it has not been downloaded. Who, after all, goes to the site of servers in order to read the information stored on them?"

The consequences of this decision could be far-ranging. A recent article in Taxation Law @ Gowlings written by John Sorensen, Stevan Novoselac and Corrinne Lobe of Gowling Lafleur Henderson LLP states: "Entities for whom client privacy is critical may be reluctant to do business in Canada in the future. At the very least, non-resident companies doing business in or with Canada in the future should be reluctant to allow Canadian companies ready access to electronic records stored on servers outside Canada. In fact, it may be advisable for sensitive information and records stored outside Canada to be available to Canadian entities in hard-copy only and on a temporary basis, to reduce the risk of mandatory production to the Minister."

For a link to the Gowlings article, click here. For the full text of the judgment, click here.

<< Top of Page

Expert panel report on securities regulation reform

On January 12th a panel of experts delivered its final report to the federal, provincial and territorial finance ministers, containing recommendations on how to improve the structure, content, and enforcement of securities regulation in Canada.

It´s no secret that the creation of a single securities regulator is a priority for the federal government. And it is supported by all provinces and territories with the exception of Alberta and Quebec.

Where do we go from here? For an article on the report from the Securities Group at Cassels Brock & Blackwell LLP, click here.

<< Top of Page

Competition Act amendments

The federal government is moving ahead with significant amendments to the Competition Act. Here´s just a few of the changes contemplated:

• Establishing a non-criminal track, with a lower evidentiary threshold, for "lesser" anti-competitive offences, including price discrimination, promotional allowances, predatory pricing and deceptive marketing
• Introducing penalties for companies that abuse their dominant market position
• Increasing penalties for deceptive marketing
• Requiring companies to pay restitution to victims of deceptive marketing practices
• Increasing maximum imprisonment terms for criminal deceptive marketing
• Significantly raising maximum penalties for criminal anti-competitive offences
• Increasing penalties for obstructing Competition Tribunal investigations

For more about these proposed changes and their potential impact, click here for a recent article by James B. Musgrove and Esther Rossman of the Competition & Antitrust Law Group at Lang Michener LLP.

Volume II - Corporate Governance in Finance & Accounting PolicyPro (FAPP) includes a policy on Competition Law. For more information on FAPP, click here.

<< Top of Page

About Inside Internal Control

Editor: Colin Braithwaite, Managing Editor, PolicyPro.

Please do not reply to this Email.

Inside Internal Control is a complimentary service published by First Reference Inc. and is sent to you monthly. Each issue provides headlines and summaries of news that affects internal controls and policies in Canada.

Please forward Inside Internal Control to your colleagues.

Please send any comments or suggestions about Inside Internal Control to the editor. For information about the Internal Control Library, click here. For more information about First Reference, including our terms of use, disclaimer, privacy policy and other legal matters, visit www.firstreference.com.

This publication is written for informational purposes only and should NOT be relied upon as legal advice or opinions. The reader should always obtain legal advice from a qualified lawyer or other qualified professional, which will be responsive to the case or circumstance of the individual. Please note that the content provided in this Bulletin or any content contained in or made available through any third party website linked to from this newsletter, is provided "as is" without representations or warranties of any kind. All representations and warranties in respect of Content or Third Party Content, express or implied, including, without limitation any representations to warranties or conditions regarding accuracy, timeliness, completeness, non-infringement, merchantability or fitness for any particular purpose are hereby disclaimed.

Copyright ©2009, First Reference Inc. All Rights Reserved.