December 2008 - Posts
The last day of the year is the end of the fiscal year for many companies - they say, "if the calendar ends on December 31, then our financial records will 'end' for the year on December 31 as well."
Not everyone picks this date. Among many good reasons, since many companies have December 31 year-ends, that means that there's a higher than average concentration of companies closing their books at the same time. This is why the concept of "busy season" exists - accounting firms have to deal with a majority of their clients all needing an audit at the same time.
We can discuss the chaos this creates later - anyone working in an audit firm will become completely unavailable to you if they're working on financial statement audits for the next few months - but we'll talk more about the effect of the year end process itself today.
If you've never been involved in running a business and don't think of it as more than "charge lots of money, and get rich doing it", then it may not sound like a big deal to you, but it is.
When you say, "we made $34 billion in fiscal 2007", that usually means that at the end of 2007 - December 31 if that's your year-end - you had your big fancy computer system say "that's it, we're done!", and then you pieced everything together to make sure the computer got the numbers right. The accounting and finance people call it "closing the period" or other similar terms.
You need to stop counting all your sales the moment the clock hits midnight. If you're a company with 24-hour stores across the country you need to check the accounting rules to see if you're supposed to say "midnight in Halifax" or "midnight for every single time zone across the country" to see whether you're allowed to choose a method, or if you should follow a single universal point in time to stop counting sales globally. To make things more fun, you then need to make sure that your accounting software obeys your wishes too.
You can see how this can accounting get horribly complicated in a hurry. Some may choose to close up shop early on the last day of the fiscal year to avoid those problems. Others don't have that luxury.
And once you're talking "complicated" and mixing it in with "accounting" in the same sentence, surely the next thing you'll likely expect to hear about is "auditors".
Auditors, it being their job, are keenly interested in making sure that you deal with December 31 properly. There's a concept called "cutoff" which I alluded to above and is pretty self-explanatory: you want to check to see whether the company that's being audited actually followed all the complicated rules that are in place to make sure that "cutoff" and all the other rules, procedures and processes that occur at the end of the year were performed properly.
Sometimes the auditor can come in a few weeks later, review the paperwork, and say, "yes, this shows that you did it properly." Or, "oops, you have a mistake here. Let's see if you made more mistakes that will impact your financial statements."
And as good as an after-the-fact review is, sometimes you have to do tests during the year. In addition to making life a little more exciting - we have to finish this test before midnight - it also means that you have to finish the test before midnight!
In the case of, say inventory or stock counts, auditors frequently need to be present, and the counts need to take place before the end of the year.
So dedicate a moment of time today to think about those poor young auditors who find themselves tramping about in safety boots, dress shirts and parkas through a warehouse - or, God forbid, frigid open field - to confirm that the Audit Client did in fact count $850 million worth of gear on hand. Not the best way to spend the last day of the year - but hopefully the work gets done before the end of the day.
Few people complain about liquor store audits though.
I'm on vacation at the moment, so is technically nothing I do at this time actually a real act of procrastination?
According to this video, no, it still can be.
And that's okay - thanks Videosift.
Just in time for Christmas, users of Facebook application Big Photo - which allows you to share a larger copy of the photos you've uploaded online - were informed that their application is being taken over and will now be users of the SpeedDate application.
At the moment that probably means that someone paid the Big Photo developers a lot of hard cash to gain access to an audience of over 700,000 users who use one application.
This isn't exactly the same thing as Microsoft buying out all the Apple users in the world, and telling them that OS X will be Vista in a week's time, but it's something along the same lines.
Here's the official message all users received - the lump of coal in their stockings:
"Next week, Big Photo's name and functionality will be changed to SpeedDate. Data entered into the original app won't be used anymore. Soon you'll be able to try SpeedDate, the fastest way to meet new people, so stay tuned! P.S. If you want to opt-out of this app, instructions can be found here."
To their credit, at least they're giving users some warning - no doubt to avoid lawsuits or some other additional 'hassles' from furious users. But doing this over the holidays may mean many won't notice the switch until they return from vacation.
No matter what they do to soften the blow, it's a bizarre way to try and grow your business.
I, among many other users, quickly deleted the application. Good luck with the ridiculous business plan.
Oh, I know, a better analogy: it's like turning a cheesecake cafe into a gas station. You'll still come to buy gas when you want pastries, right?
Despite a day of rain, it's still a white Christmas outside.
For CAs and CA students, it's a great time to remember to give something back to our community, while you're enjoying what, for most of Ontario, is a picture perfect landscape, as well as the warmth, love and other gifts from spending time with family, .
The easiest way I can suggest that you give back is by participating in the upcoming ICAO low income tax clinics.
You help those in need, among others including recent immigrants, impoverished students, the elderly, disabled and others who may have trouble filling out the simple-yet-maddeningly-complicated personal income T1 tax forms. The ICAO sent out an e-mail their Chartered Accountants members with some additional background:
The year 2009 will be the 41st year of the Free CA Tax Clinics Program, and we need your help more than ever. Last year, a total of 1,600 CAs, CA Students, Associate Students and Membership Candidates helped prepare almost 11,000 tax returns, but we can still do even more to meet the need in our communities.
All that is required is a few hours of your time, between February 17 and March 31. In just one evening, you can help as many as six people. Together, we can help thousands of low-income people receive tax refunds and credits that are only available to them by filing an income tax return. As a volunteer, you receive the personal satisfaction of helping your community, while at the same time enhancing the profile of the CA profession.
The ICAO also points out that the returns completed at the ICAO tax clinics are generally simple. "The clients have low income with no rental properties and no business income. In most cases, there is no tax payable, but the individual needs to file a return in order to be eligible for refundable tax credits, the GST credit and other tax benefits."
Most people who pay rent and have income below $20,000 in Ontario are eligible for tax credits - but they have to apply for them to get them! The exact amount varies based on how much you're earning, paying in rent, and your age - senior citizens get an automatic jump in their credit.
It's sad to think that someone who barely has enough cash to get through the month is going to fork over $50 or $100 to one of those shopping mall tax return kiosks to get somewhere between $200 and $500 back.
That's a huge percentage of their refund - particularly if they barely have enough money for food or any other necessities!
That's where the CAs come in, riding in like the personal finance cavalry.
In addition to providing support by helping them avoid losing a big chunk of their tax return to a for-profit office, you provide an ear to listen to their stories and to feel appreciated by someone.
I've been attending one particular clinic for the past few years - it's heartening to see the same faces year after year. Just like you have a pleasant feeling from having "continuity" on a regular audit client, it's a delight to see the same people coming back to you - with a copy of the return you prepared for them last year in hand to boot!
To sign up and experience 'the wonderful', click here to register yourself. You'll need your member number and password - if you don't remember them, call the ICAO during business hours and they'll help you out.
Alternatively, rather than going through the ICAO you can instead contact the person in in your office who coordinates your company's free tax clinic groups. Most larger companies run their own clinics, which means that you have all the advantages of support from your home office in terms of resources and extra help to get you prepared.
To sweeten the deal the ICAO also has a raffle for those who volunteer at five or more clinics, to win some nice prizes. I mention this mainly to encourage those who are primarily motivated in life to do things if there's a raffle involved to sign up and get more details about the wonderful 'thank you' swag you might win for being helpful.
Additional Information for CA students
The clinics, in addition to being a superb way to help others and become a better person through selfless giving, offer other bonuses - which you'll learn after reading answers to some of the questions I've received:
Q: What is the maximum number of hours at the clinic that can be used as part of the 100-hour Tax Hour requirement?
A: Last time I checked - about a year ago - you can use up to 20 hours from the clinic. Feel free to double check with the ICAO to see if that information is still current, though I don't see why that would change.
Q: And would these hours count as part of the total 2500-hour Chargeable hour requirement as well?
A: Yes, definitely.
Q: It's been a while since I learned about low-income tax credits. Is any training available?
A: Yes - the ICAO will have a training clinic at their offices at 69 Bloor Street East in Toronto and will have training packages available if you live outside the big city and want to hold a session. Sign up soon though, as the sessions are popular and fill up early!
Q: I'm not a CA, but a casual reader. Why do you hot shots need training?
A: Keep in mind that as versatile as CAs are, they don't spend the entire
year cuddling up with the Income Tax Act - or ITA, for those in the
know. Many CAs deal with audits, operations, and all sorts of other
wonderful areas that rarely if ever deal with the rules in the ITA - so
a quick refresher is always a good idea.
Any university professor worth their salt would have given you exam questions and assignments where you not only calculate a tax return for a high income individual, but for someone in the lowest tax brackets - because completely different deductions and credits kick in depending on how much money you've earned during the year. Since most CA firms' clients will be in the middle to upper tax brackets, it's not uncommon to need a refresher on the lowest brackets - knowing where the social assistance income goes "in and out" of a return, for example, is easy but you might be rusty if you haven't done that sort of thing recently. Details concerning how social assistance is treated and the Ontario low income tax credits get treated along with various other topics will be explained at these sessions, along with any relevant changes to tax rules since the previous year, for those who are old pro but still need to catch up on the latest and greatest developments out of Ottawa.
Q: One more question from the preparers: do we get tax prep software if we don't have it already?
A: Yes, the ICAO has a deal to get you tax preparation software for use at the clinics, but honestly, I never used it to prepare the returns at the clinic. The returns are just too easy. Plus, you need to bring a printer - or have one available - to make use of them, and the returns are so short that you can do them by hand as fast if not faster, once you have some experience doing them. Plus, not having a laptop computer creating a barrier between you and your client makes the experience a bit more personal. It's the same reason I'll sometimes use a paper notepad at a meeting rather than take all my notes electronically. Using pencils and pens can add a certain something to the experience.
Aside from making it easier to fix small errors, the only other major advantage of using your computer to prepare the return is that it's easier to print a second copy for the client to keep for their records - but you can just as easily accomplish the same thing by using carbon paper when filling out returns by hand - yes, it's an archaic technique, but hey, it works. Alternatively, clinics located in actual offices may have a photocopier that will allow you to quickly duplicate the completed return. That's a very popular option when it's available!
You must be excited and ready to do the ICAO clinics - so go and sign up today.
Next time, look forward to a discussion on the topic of what it's like to receive job offers while you're on vacation. And how delightful it is to say, thanks, but no thanks.
Anyone who has studied economics knows about economic cycles. Right now things are clearly rather absolutely horrible - it seems like everyone, including fellow blogger Joe is reporting layoffs.
Francine touches on the subject while going into huge depth on how a CFO should handle their Big 4 service provider.
It's easy to be stuck in the death spiral of pessimism at times like this.
Even though, as an Economics Major, you know that things will at some point things always improve.
But when? When prices fall low enough, perhaps.
For now, less driving, more walking.
As everyone cuts back to save money, that's causing everyone else to cut back even more. It's bizarre, but at some point it should stop.
Some people out there who saved up money will swoop in and start buying things when their prices have fallen low enough.
How low? Who knows. That's the giant question mark billions would love to have answered.
Looking at how things are progressing, yes, people who didn't sell early suffered from a bloodbath in the stock market.
Employment figures are suffering in a very real way when people get
laid off or can't get that crucial first job after university.
But despite that, the majority of the workforce is still gainfully
employed; experienced and highly skilled workers are still in huge
demand - I know this is true in the accounting fields anyway. It also helps that modern Western societies enjoy strong social safety nets that guarantee
a "minimum level" of demand for products and services. Though in some
jurisdictions that net is in tatters, which is worrying.
Still, the ultra-dire allusions to the Depression of the 1930s, as a result, sound a bit excessive.
Slowly but surely, things will improve. As much as it might help in
some ways, widespread social upheaval is unlikely - oh how silly I would
feel if I was proven wrong on that front by being "first against the
wall!" - but with any luck soon we'll be "digging up" rather than
How much longer though?
In the meantime, there's ways to help others, as Bill writes.
Even if you can't singlehandedly save the economy, there's always a way to help others, by volunteering or doing other good works. It's important and valuable to do these things all the time, but especially when peoples' needs increase.
With that in mind, I wondered whether having all spending is under review meant trouble for charities my company is involved with. After all, it's not like charities need less money when times are tough. I have faith we'll do the right thing, but until you find out, you worry.
So to avoid worrying, I boldly asked the head of my office who, among other things, funds charity events, whether the annual corporate chairty event I started in my office three years ago would continue to be sponsored by the company in the coming year.
I was overjoyed when the answer was immediate: "yes".
At least I can continue to help in my own way in more than one way.
I'll probably also find myself helping out at the ICAO low-income tax clinics again this spring too, this time as a full-fledged CA! I share that not to brag or anything, but to encourage other CA students and full CAs to join in.
The cool thing is that every clinic needs a CA with full credentials to supervise the CA students - this is one of the earliest tangible 'real world' benefits of having a CA, where you feel like you're really helping people in a significant way. It's awesome.
The tax returns aren't especially difficult, but you do need to know what you're doing to make sure the neediest of the needy get the largest possible tax refund they're entitled to.
Being able to provide free help with these occasionally maddeningly complex forms feels especially good when you know that you're helping someone save $50 or $100 that would instead go to one of those tax prep centres when the person you're helping barely has enough money for food as it is.
Any new government benefits often require another calculation. To anyone who soldiered through high school, university and the rest of the CA process, it's easy. But not everyone enjoyed the experience of completing high school let alone all those other perks of living in Canada in a supportive society.
With all the madness and barbarism in the world, it's the least you can do. The fun part is deciding what to tackle after that.
Seriously - check this site out - many more examples there.
The above is from that site.
It's the lolcatz meme applied to the financial meltdown. Nice.
It reminds me of the lolcactus I saw on vacation a year ago in Europe.
I knew I would upload it one day.
The cactus doesn't make the market tragedy hilarious, of course, but I might as well share it now rather than later.
Previously we looked at a very basic introduction to the concept of audit economics - if you only read the original post, go back to check out Francine's insightful and deeper comments.
Now, to discuss the close cousin of audit economics: time - in particular, what happens when you realize you're going to run out of time on an audit.
Don't worry, you won't be banished to crazy in Central Park.
For non-auditors, some background is called for: audits are run according to schedules. Just like a train may need 4 hours to get from one city to another, with 10 stops on the way, an audit has its own schedule - a budget for time.
You may have 40 hours to:
- plan your job,
- perform it,
- have your boss perform a quality review, to make sure you did your job correctly, and
- fix any errors or gaps your boss points out in the quality review.
40 hours - any auditor will tell you - is a puny budget for all but the smallest tasks - that's one week of work for a single person. Most jobs will range from a hundred to thousands of hours, depending on how big and complicated your client is. Time will be split between you and your entire audit team as well. Five people all working at the same job for one week? That's 200 hours. Or even more if it's busy season, naturally.
Whatever the budget, if you line up everything in advance, can things work out exactly according to plan?
Sure - but in general, no plan survives contact with reality.
How can those perfectly laid plans go awry? Let's ask the point of view from the young auditor, at Last Year's File:
You quote a client a fee, you begin your work and all of a sudden a
million unpredictable things pop up.
Now I'll continue the quote, but note that I'm going to quickly point out a few things that are missing:
In this scenario two things can
happen. One, you go over-budget. eat the time or bill the client for
the extra work. Two, you work up to the quote. The later is really
dangerous and I’ve heard it happens. In the second case you stop once
you’ve hit the quote regardless of the level of work you’ve done. It’s
a risky move.
"Scenario two" is incomplete. You always need to leave time to finish what you started. Doing otherwise is irresponsible. This means that at the earliest possible moment it looks like you're going to run out of time, figure out why. Did the client just announce major layoffs? Are they buying out a competitor? Did the stock market implode, affecting a deal they were planning on making?
Whatever the reason, a quick audit can quickly turn into a very long job, and you need to point out what's going on. You may not know what effect it will have, but any of those scenarios will affect your timing. In particular, you're not going to have enough of that time to get the suddenly larger job done according to your initial plan.
Less dramatic things pop up too. Someone who knows "everything" gets sick. There's floods in the
client's records department. One of your staff wears a rude shirt to
the client site and as a result everyone is kicked out for a day. Okay, those are still 'dramatic' examples I made up on the spot, but you get the idea. Various things can happen. The file you need got sent to Winnipeg instead of Edmonton. Whatever.
The problem is that the net effect of all these little slips can be difficult to quantify individually, but can add up to a lot.
In a situation like this, it's essential that you have some intelligent method of keeping your boss informed.
What do you mean, "depreciation on the locomotive is slightly higher than anticipated?"
You're not being invited to indulge in small talk if the manager asks, "how are things going?" Well, you can be civil and engage in some small talk too, but you have to make sure that you remember to also mention all those million little things, what effect they have, and where you need help. And of course, if you're finding problems, those should be raised sooner rather than later.
I can imagine someone scoffing at this advice saying, "sure, if you see your manager more than once a week or once a month," but I would reply - that's not good. You should be in contact regularly and frequently with whoever is supervising your work - and the 'younger' you are, the more frequent that contact should be, especially if you're doing something that's absolutely new to you.
If you've filled out a hundred GST returns before, then you probably don't need much guidance unless you see something weird.
But if you're dealing with a ridiculous obscure financial calculation you've never seen before, you owe it to yourself to make sure you get all the support you need to understand what you're doing and to get it done correctly.
The young auditor supporting the KPMG audit of BCE no doubt smartly reported up to her managers and partners the results of the calculation: something doesn't look right.
The worst possible thing you could do is to work 90% of your work, keep all your findings under wraps, and then jump out and scream "SURPRISE!" The media frenzy that followed that news was to be expected - which means KPMG simply had to spend more time dealing with the Bell Canada situation.
It would take time to prepare for the announcement and to be ready to defend their conclusions.
Budgets were no doubt quickly revised, updated, and submitted to the right people in that case.
Of course, with news that big, the modification to the audit schedule, while important to the auditor, seems to pale in comparison.
So don't stress about the fact your budget is a "living" organism, constantly evolving. But don't deny its evolution or tragedy may follow.
A profit margin for a large factory can be reduced to a simple formula. You sell your product for X, and it cost you Y to make it. That makes Z your profit.
X - Y = Z
A young accountant can be forgiven for following into the following trap:
Here’s the thing that confuse me the most. Profit per file should be
fees, less the the prorated salaries of the employees doing the work.
But, under a billable hours system profit margin is the difference
between the final fee and billable hours. So you can have a negative
“profit” margin - i.e. go over budget - while still making a profit
from the firms perspective.
It's a clever idea, if you're thinking like an economist: Marginal Revenue which exceeds Marginal Cost is considered a Good Thing, if you're keeping things simple.
The problem is that the above idea, while attractive, doesn't capture true costs. It might come close, but there's other factors at play.
If you work with your friends you may just try and add up your cost "Y", and subtract it from the money you earn, "X".
As your business gets bigger and more complicated, however, what gets included in the costs, "Y", increases, dragging down your profit margin.
Those mega-parties aren't cheap, you know.
If "Y" is simply the amount of money you pay yourself, your friends, and whatever taxes you owe the government, then the above theory works.
But larger companies need to pay for their many employees, their perks, plus expenses like marketing, insurance, rent, legal fees, training - the list could take all night to write.
So if your accounting firm is earning more in fees than your employees are paid, are you making a profit?
The bigger you are, the more complicated, and expensive, things get. You need to earn enough money to not only pay your staff, but also all your fixed and variable costs, plus enough so you have a decent profit margin for the owners.
You start learning about costs in your first accounting class so I'm not going to rehash that topic. And only an anarcho-syndicalist would argue that owners don't deserve to earn some profit if they manage their investment wisely.
All this means is that using the benchmark of how much your staff 'seem' to cost would lead to a loss situation in most cases.
Accountants, of all business people, should know when to accept work and when it's actually going to lead to a loss. The math used to arrive at these conclusions is in theory simple, but it often gets increasingly complex.
Over time you'll be exposed to your company's way of tracking the "economics" of your work - where you learn the secrets behind how decisions are made to assign staff to projects. While you're a fresh out of school or just done the UFE you will be fired up to revolutionize your company - which is a Good Thing - but you have to give yourself time to learn about any company - yours, or a client's - before you can really make deep suggestions.
If it's practical, it's a good idea to spend time with people who are more involved in managing your company's costs; you'll learn a lot from them in a faster period of time, shortening the time you spend on the learning curve.
Next time I'll discuss another dilemma raised by Last Year's File: how to deal with the uncertainty of "time" when you're out on a never-ending audit.
Yet another reason to celebrate if you passed this year's UFE: it was the hardest in half a decade.
While contributing knowledge to the online timesink encyclopedia, I realized that the UFE page has a rather handy list of the previous pass rates. My year was, judging by the pass rate, perhaps the easiest from this time period - or had the least surprises overall.
I lean towards blaming the exam rather than the writers: this year's questions included some particularly devilish personal finance questions which few writers expected to see. This week is still going to be a place of focus for those who succeeded, but as a "supporter" of my firm's writers, I'm already thinking about what gave people trouble and how we can improve the performance of those who didn't make it this year.
I feel really bad when I look up people I know on the ICAO website and they're not there.
In those cases, especially if I don't really know the writer all that well, I hope that there's been a mistake or they chose not to publicly disclose their result on the website - you can choose to wait for the letter to arrive in the mail next week.
Very few people choose that option, though, which makes me conclude that the news is not good.
I've written before on how to address the reasons you didn't pass the UFE and I'll certainly revisit the topic again in the near future. Until then, the most important thing to do is to review your results, and if your score is a borderline fail, I strongly recommend trying an appeal. You have a very small chance of success, but if it works, the payoff is more than worth it. And I predict more appeals than usual this year, given the lower pass rate.
Consult with your friends and mentors to determine whether you have a borderline case or not - you don't have much information to go on - and good luck.
All three of my mentees passed - I'm so incredibly proud of them. Each of them had their own challenges - as we all do - and all of them were successful.
The only thing as good as passing the exam is seeing your friends pass.
They're out still partying, catching up on missed sleep, or still jumping around with joy and relief.
Congratulations also to young Mr. Direnfeld, CA student blogger and another successful writer!
Passing the UFE: significantly more challenging and satisfying than winning the Fruit Loops Olympics
While scanning through the results list, I realized a friend from elementary school also passed - congrats to her as well!.
Now the only question is - why did the ICAO decide not to publish the passing rate for Ontario?
Other provinces have revealed the overall national pass rate is 71.7% - thanks for the heads-up, Bill.
Is Ontario afraid of a little competition from Quebec? Oh come on now.
One of my colleagues, another successful writer, is so full of increased confidence, that he boldly declared his ability to easily decipher what Ontario's pass rate was, using other available information to deconstruct the statistic. I don't doubt we can figure it out - we already know how many people passed - all you need to do is calculate the total number of writers who attempted to pass and you're set.
There's nothing like trying to recalculate an ultimately meaningless statistic if you're doing it out of spite for someone trying to suppress it.
Congratulations to the successful writers!
The above link takes you to the Ontario UFE / EFU results. EFU is the French acronym for the Uniform Final Evaluation.
If you're in Quebec you've been partying since last night - they get their results the night before, for some reason. And Atlantic Canada finds out early in the morning too - so I've already been congratulating my Eastern Canadian mentee in advance of the Ontario results.
DJ'ing, photography, moral support: just some of the other roles you find yourself playing as a CA, I've found to my delight this fall.
Tonight all the nervous writers of the 2008 UFE will sooth their nerves in anticipation of the final leg of the nervous wait until the 2008 UFE results are released. The UFE is the Uniform Final Evaluation exam: last step in the 'academic' part towards becoming a Chartered Accountant in Canada and Bermuda.
In this age of electronic everything, you would think they could expedite the process. But then again, even 'electronic everything' can fail, which explains why the various provincial institutes take their time assembling their results before unleashing the life-changing news. Making their lists, and checking them twice.
The UFE hall, as it looks in the middle of the September trials.
As usual, I have no idea where most other parts of Canada will get their news, and for that I apologize. If any readers in those provinces wants to share the links, please do - but if Google doesn't see your local "UFE results 2008" link, then I'm going to have to assume it doesn't exist.
Ontario's results will be released by the ICAO at this site.
I still get chills just thinking about the time spent logging in and updating that page frequently to find out results in prior years. I'm sure this year's writers feel the same way.
If anything, the tension is higher: with economic concerns eroding the job security accounting kids thought they had, the pressure to pass is higher than ever in recent memory.
The Western provinces, I should add, released this PDF outlining their results release process. Curiously enough, you'll be able to find out in certain central venues - but I'm sure most people will nervously load www.casb.com instead.
One thing to keep in mind is that the information is not stored on the Institutes websites' forever - I realized this while trying to click on my old exam result link. Presumably due to privacy considerations, the information is eventually removed. In some ways this makes sense, in other ways it tempts you to load the Internet Wayback Machine to see if you can find the information you're interested in. Hint: yes, that'll work nicely.
A funny twist in this year's process is that due to some last minute changes, I find myself DJ'ing a release results party - and trying to fit in photography of it too while I'm at it.
As a result, I've been combing my collection for some good tracks.
I've also been asking my 2008-candidate friends to supplement my collection - my surprisingly popular posts on Metric and Sam Roberts reveal much about what kind of music my collection slants towards. I'm curious to hear anyone else's perfect UFE result playlist. Mine should be interesting, given the short notice I gave myself in compiling it.
But enough about my silly little preparations - good luck to the writers.
Less than 30 hours to go!
Are the Elgin Marbles going back to Greece anytime soon?
An opinion reversal?
I already wondered about this earlier - and my view hasn't changed. It's just not likely, especially if you read something like this.
DBRS did the math as well - and although they point out the scenario is unlikely - the math is what it is:
DBRS ran the number on this kind of doomsday forecast in October,
and said the value of the assets didn't meet the debt. DBRS managing
director Paul Holman wrote: "This base case default scenario results in
a decline in enterprise value of BCE ... to roughly $34.4-billion or 33
per cent lower than the $52-billion enterprise value when the
privatization was announced on June 30, 2007."
In an interview, Mr. Holman said: "In a default scenario, we show
total assets would be less than total liabilities and senior lenders
would be covered but the unsecured and subordinate lenders would not be
There's a healthy discussion going on in the comments thread here. It's interesting to note what a hard time some people are giving KPMG for doing the Right Thing. Of course, not everyone is. Others are also congratulating them for standing up for their calculation.
It's one thing to say, "your math is wrong", and another thing to say "we don't like your assumptions."
If the assumptions used to do the math are in line with the wording in the contract, then it won't be very likely that things are going to change.
And I really doubt Bell Canada will find another auditor foolish enough to upend KPMG's assessment.
That would not end well.
In unrelated news, the Canadian government was just overthrown. Great newspaper front pages here.
I love pointing this out to Americans who have no clue what just happened up here. An election, followed by a completely unrelated change in government. Nice.
We move fast up north.
I kept the earlier thinking about "assumptions" alive when I saw the contract
the three opposition parties signed to form the new government. I wonder how much time before someone tries to drive a Mack truck through one of the loopholes I'm sure someone will discover in it?
It's going to be an interesting political season, long after the BCE takeover talks fade away into distant memory.
Though I imagine expensive legal wrangling will keep that on the radar for a while longer too.
Check out this post, exposing yet another crazy scam, "241 Financing."
Here's an excerpt from their ad - with David Fleming's comments below each underlined segment from the ad:
*Fully open line of credit from $10,000 to $250,000
So they’re not only going to approve your mortgage, they’re also
going to give you access to a huge bank account full of money. So
either the borrower will use the line of credit to pay make the
mortgage payments, or they’ll just spend, spend, spend. Either way, I
don’t like this idea one bit.
*Poor or no credit
Are we really in the point of the economic cycle where people with poor or no credit
should be getting mortgages approved? Isn’t this where the United
States went wrong? What’s worse: poor credit or no credit? Does it
*Beacon reject or scores from 400 and up
When I see the word “reject” in the advertisement, I can’t
help but question the calibre of clients they are actively TRYING to
attract. So when you’re rejected elsewhere, come to 241 Financing?
So they don’t require any information regarding your tax
returns, finances, or income? They don’t need this magical piece of
paper; this NOA that every single other mortgage broker requires?
*No proof of employment or income required
Okay, this is the worst point by FAR. What kind of mortgage
company doesn’t want any proof of employment? It’s one thing to let
the income verification slide, but it’s another thing to actually
advertise it! So basically, you can tell 241 Financing Inc. that you
work as a freelance millionaire and you go from town to town finding
bags of money like in a video game, and they’ll just take you at your
word? How does this work? WHO are they getting to approve these
One of David's incisive observations, aside from exposing the entire idea as a disaster in the making, is the fact that their website isn't even operational. He says, "Any fourteen-year-old with a laptop and an iota of competence can start a website, yet 241 Financing Inc. is only capable of putting up their logo, contact information, and the words “Coming Soon” on their web page."
Allowing crazy schemes like this to flourish contributed to the financial market implosions and current US recession. Who would think, "gee this sounds like a good plan" at a time like this?
In other scam news, I only got hit by 594 pieces of spam in November - a big fall from October's 897.