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Volume 5, Issue 2           

  1. BYOD, the latest workplace threat
  2. Challenges of IFRS transition
  3. Pension reform: Ontario acts?
  4. Risk-based pension regulation
  5. Internships and the law
  6. Charities update
  7. Governance tips
  8. Policy updates


BYOD trend poses immense challenges for organizations

No, employees aren't bringing their own alcoholic drinks to work, but they are bringing in their own mobile devices and expecting to use them with their employers' networks. What does that mean? Well, chances are several (or many) of a given organization's employees have personal smartphones or tablet computers, and they probably want to use them to perform work tasks.

The most basic example is checking email. We've all heard of the CrackBerry addiction, which finds employees checking their work email at all hours of the day, at work and play. Well, BlackBerry phones were (and perhaps still are) primarily business devices, usually offered to employees by their employers. Generally, employers have a significant amount of control over such devices.

The reverse is happening now. Employees want to use their own personal mobile devices—and a bewildering array of them—to do work (wherever they may be), and it's much more difficult to control all of them.

In any case, accommodating such personal devices is likely inevitable due to the increasing shift toward mobile computing. Smaller organizations particularly—which probably can't afford to buy a device for every employee who needs or wants one—might find BYOD advantageous. That is, if they can manage to maintain control of their networks.

Computerworld recently published several articles on BYOD and mobile technology.

Read Ryan Faas on "How mobile, BYOD and younger workers are reinventing IT."

Here's Matt Hamblen on "Chief mobility officer: The next big IT job?."

And here's Steven J. Vaughan-Nichols with a cynical look, "BYOD: Good for whom exactly?" (Might require free subscription.)

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The challenges of IFRS transition in Alberta

The Alberta Securities Commission has released its 2011 Corporate Finance Disclosure Report. According to the report:

The adoption of International Financial Reporting Standards was a significant undertaking for reporting issuers and affected virtually every capital market participant in some respect. It placed a significant additional resource requirement on those already dealing with an environment of continued market volatility and increasing financial market complexity.

Not surprisingly, during this transition year, the commission came across several problems with reporting issuers' IFRS conversion filings. These included:

  • Missing financial statements, mainly the "Statement of Changes in Equity"
  • Documents describing the impact of the transition did not go into sufficient detail
  • "Boilerplate" accounting policy disclosure, meaning reporting issuers failed to describe adequately the new policies they had chosen and applied
  • Failure to disclose IFRS 1 exemptions taken
  • Inconsistent use of new terminology
  • Mixed GAAP disclosure in MD&A
  • The appropriate discount rate for decommissioning liabilities

The report includes lots of useful information, specifically for reporting issuers in Alberta, but any company making the transition to IFRS should benefit from perusing the commission's observations and expectations.

Of course, the report also describes the commission's corporate disclosure review activities and other information relevant to Alberta businesses, along with numerous examples, tips and reminders.

The commission also offers archives of many of its webinars.

Here's the Events & Presentations page.

Here's the "2012 Corporate Finance Review Sessions" webinar.

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Pension proposals and programs in Ontario

Among the day-to-day political crises that come and go in the news, pension reform has persisted for years now. Is the current system sustainable? Are Canadians saving enough? How can the government make citizens pay more attention to pensions? What role do employers play in engaging workers?

Well, the Financial Services Commission of Ontario has been holding consultations and reporting on the issues for the past couple of years and has come up with:

a framework to carry out its commitment for enhancing its pension regulatory services, communications with pension stakeholders and broadening stakeholder engagement in pension initiatives and projects.

I think that means the commission will be working to make things easier for pension-holders and managers. You can read a report on the project here.

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Risk-based pension regulation: fancy name, but what does it mean?

The Financial Services Commission of Ontario (FSCO) is proposing a risk-based system of regulating pension plans:

To improve FSCO's overall effectiveness in its monitoring of key pension risks, and to ensure appropriate regulatory response is taken by FSCO to address risk situations, thereby better protecting the interests of pension plan beneficiaries.

Essentially, this means improving risk assessment and monitoring, following five principles:

  1. Taking proactive measures to promote compliance and to reduce risks to plan beneficiaries
  2. Focusing attention on those plans posing the most serious risks to the security of plan beneficiaries' benefits
  3. Ensuring the regulatory response is proportionate to the risks identified, with due regard to the probability and impact of risk, and intervening on a specific basis only when necessary
  4. Applying our approach consistently and in a way that minimizes uncertainty about our likely response
  5. Assessing the risk and regulatory response based on the evidence gathered from appropriate sources

The approach will apply to all pension plans that are registered in Ontario. Although the system is not finalized yet, organizations that offer such pension plans should begin reviewing the new program alongside their own existing pension plans.

Read all about the Risk-Based Regulation Framework in this FSCO consultation paper. The date for responses has passed, but the information remains important.

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Internships and the law

You might have heard or read something in the past few months about internships—their status with respect to employment standards and whether it's even legal to employ such workers without paying them. It's no small issue. Many organizations rely on unpaid interns to do work for which they can't afford to hire an employee proper. And many individuals rely on internships to gain the experience they need to enter the workforce proper.

Shaun Smith writes on CharityVillage.com:

The problem is that there is no legal definition of an intern. For example, earlier this summer, following a series of media stories questioning the legality of internships, the Ontario Ministry of Labour took the unprecedented step of adding a fact page to their website entitled Internships in Ontario: What you need to know. The page makes it clear that, while no regulations pertaining to unpaid internships exist within the law, internships must nonetheless conform to a strict set of criteria to be considered legal.

Lawyer Andrew Langille notes that, "There is widespread mischaracterization of interns as persons receiving training, when in actuality they are employees."

Check the details on CharityVillage.com. And remember: this isn't an isue that affects only not-for-profits or charities. Any organization that utilizes unpaid interns should understand the legal relationship. Look for resources specific to your jurisdiction.

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Charities update

Don't forget to keep track of the Canada Revenue Agency's Charities Connection newsletter! With the new Canada Not-for-Profit Corporations Act and other recent changes (for example, as announced in the 2011 federal budget), charities must keep up to date on their legal obligations.

The latest issue covers the following issues introduced in the budget:

  • Changes for qualified donees could affect your charity
  • What is a qualified donee?
  • Other significant impacts: new requirements for other qualified donees
  • New lists on the charities and giving web pages
  • Changes for registered Canadian amateur athletic associations (RCAAA)

Future issues of Charities Connection will cover:

  • Safeguarding charitable assets through good governance
  • Recovering tax assistance for returned gifts
  • Granting of options to qualified donees

You can also join the CRA's 2,000+ followers on Twitter to get regular updates on agency activities, information about credits and programs and other tax advice for organizations and individuals.

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Governance tips for all types of organizations

I've known about the all-encompassing Canadian legal blog Slaw for a while now; I've been editing my colleague Yosie St-Cyr's posts there for a couple of years. But only recently did I come across the sister site, SlawTips, which offers advice on a wide range of organizational governance topics, from a recent series of "Top 10 Financial Errors," to using technology like the Internet, social media, tablet computers, digital cameras and so on, to time and project management.

While some of the advice is directed at lawyers, there's lots of value in the SlawTips archive for any type of organization. And the site is handily divided into technology, research and practice sections. Take a look!

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Policy updates

The first 2012 release of Finance and Accounting PolicyPro (2012-01) consists of a replacement for Chapter 6 — Internal Control of Volume II — Corporate Governance. The material has been updated and freshened.

The latest release of Not-for-Profit PolicyPro (2012-01) replaces half of Chapter 1 — Corporate Administration, including the Introduction. The material has been updated, refreshed and rewritten where necessary.

The latest release of Information Technology PolicyPro (2012-01) replaces all of Chapter 3 — Software Acquisition, Implementation and Maintenance.

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About Inside Internal Control

Editor: Adam Gorley

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Inside Internal Control ISSN: 1916-4866

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