New CRA guide on charity fundraising
On July 9th, the Canada Revenue Agency released guide CPS-028 on fundraising for registered charities. The guide is intended to help charities comply with reporting requirements, and encourage them to self-assess their fundraising activities.
The guide focuses on:
- Distinguishing between fundraising and other expenditures
- Allocating expenditures for the purposes of reporting them on Form T3010, Registered Charity Information Return
- Dealing with activities that have more than one purpose
- Understanding how the CRA assesses what is acceptable fundraising activity, what may preclude registration, or what may result in a sanction, penalty, or revocation
For the CRA press release, click here. Click here for guide CPS-028, and here for the additional information necessary to fully understand the guide.
This guide is the final version of the proposed guidelines released last year, and discussed in Vol. 1, Issue 4 and Issue 7 of Inside Internal Control. And according to a recent article by Terrance S. Carter, B.A., LL.B. of Carters Professional Association, a full-service law firm with a focus on charities and not-for-profit organizations: "while the Guidance represents a significant improvement over the Proposed Policy and the Proposed Background Information, it will likely prove to be challenging for charities to comply with."
To help build stronger internal controls in your charitable organization, Not-for-Profit PolicyPro (NPPP) features more than 25 ready-to-use policies and 50 helpful procedures focussing on corporate administration, governance, advocacy and public policy, financial management, and human resources. For more information on NPPP, click here.
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FAQs about GAAP for private companies
As reported Vol 2, Issue 4 of Inside Internal Control, there´s an outstanding exposure draft from the AcSB on financial reporting standards for private enterprises. The period for comment ends at the end of July. In the meantime the AcSB has released a useful list of FAQs on the new standards. Click here for the FAQs.
Release 2009-04 (August) of Finance & Accounting PolicyPro features a revision to policy FN 7.08 - International Financial Reporting Standards that includes the latest developments and will help your organization make the transition to IFRS.
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Facebook violates Canadian privacy laws
Facebook made news recently when the federal Privacy Commissioner took it to task for breaching Canada´s privacy laws.
The Commissioner´s office said that Facebook´s practices contravene several of the principles that underlie the Personal Information Protectection and Electronic Documents Act (PIPEDA). Here are a few examples:
- The collection of personal information should be limited to that which is necessary for the purposes identified by a company. However, Facebook´s third party developers have access to users´ email and home addresses, even though this information is not needed for the applications the developers provide
- A company should make its policies and practices relating to the management of personal information readily available to individuals . However, Facebook´s policies about the retention of personal information for deactivated or deceased users was not clearly stated
- The knowledge and consent of an individual are required for the collection, use or disclosure of personal information, except where that is inappropriate. However, the names and email addresses of non-users, where they are tagged in photos or invited to join Facebook, were being retained
For the CBC.ca news story, click here.
Click here for the Privacy Commissioner´s news release, here for the finding, and here for the backgrounder.
The 10 principles for the protection of personal information are contained in Attachment A of policy GV 1.11 - Confidentiality and Privacy in Volume II of Finance and Accounting PolicyPro (FAPP). For more information about FAPP, click here.
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More comments on ECPA
In Vol. 2, Issue 4, we discussed the controversial Electronic Commerce Protection Act (ECPA) and the threat it might pose to legitimate business practices in Canada. Click here to read more criticisms of the proposed legislation from the Business Law Group at Cassels Brock & Blackwell LLP.
But for a contrarian view supporting the proposed legislation, click here and check out the transcripts of Michael Geist and others appearing before the House of Commons standing Committee on Industry, Science and Technology on June 11th.
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CRA reneges on compliance agreement
In a recent decision, the Federal Court of Appeal ruled against a church whose charitable status had been revoked by the Canada Revenue Agency. What makes this decision noteworthy is that the church had signed a compliance agreement with the CRA, which was subsequently withdrawn when an audit revealed the extent of the non-compliance. As Mark Blumberg of Blumberg Segal LLP notes on globalphilanthropy.ca: "Many charities view a compliance agreement as the end of their worries - in fact signing a compliance agreement is the beginning of a path...."
The latest release for Not-for-Profit PolicyPro (NPPP), features a revised policy 1.06 - Taxes and Charitable Returns. For more information on NPPP, click here.
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In the past month, we´ve been hearing a lot about the need for "net neutrality". This is a new name for a story we´ve been covering for many months in Inside Internal Control. It started as a struggle between Bell and the smaller ISPs that use its network about traffic-shaping technologies, specifically "deep packet inspection" and "throttling" certain bandwidth-intensive activities, like peer-to-peer file sharing.
The reason it´s in the news is that the CRTC has been conducting long-awaited network management hearings with Canada´s telecom and cable companies and a number of consumer, creator, and technology groups. And it turns out that Bell is not the only guilty party; all of the largest Internet providers including Shaw and Rogers engage in different kinds of control activities. Rogers, for example, uses "bit caps", hard limits on the amount of data that a user can download.
For a story on CBC.ca, click here. For the Net Neutrality website, click here.
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About Inside Internal Control
Editor: Colin Braithwaite, Managing Editor, PolicyPro.
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