A Counting School - Hardcore Chartered Accountancy

Canada wins gold! Which Big Four firm is winning?

Congratulations to Alexandre Bilodeau for bringing a glorious golden victory to Canada's western shores!

In tribute to his spectacular mogul run, I offer some Big 4 snow sport action.

The snow profile above, sadly, is a little too similar to that in Vancouver this month. Who would've expected mild weather in February - aside from anyone who's ever visited or moved to B.C. for that very reason?

Alexandre's victory reminded me the fall recruiting season - yes I'm going there - where two of the Big Four firms trumpeted their involvement with the Winter Games.

But before we get into who's doing what on an official level, let's see what's going on from Google's point of view, searching for "FIRMNAME" and "Vancouver Olympics:

1. PwC: they're running a study to figure out whether or not the Olympics end up breaking even or perhaps even generating a profit for the hosts. How very stereotypical for accountants, I know.
   
2. KPMG: a profile on Executive VP and Deputy CEO Dave Cobb, a KPMG alumnus. We'll revisit this below.
   
3. Ernst & Young: auditors of VANOC's 2004 Financial statements. Geekier than PwC perhaps?
   
4. Deloitte: the official sponsor, supplier in the "Professional Services ("Big Four firm")" category. Deloitte has the honour of providing all that sexy intellectual support which people expect Chartered Accountants to deliver.

So three of the four firms have had or continue to have direct involvement with the Games.

I'm a bit curious as to whether Deloitte scored the audit work once they became official sponsors.

Depending on how you interpret "Independence" rules, if you're sponsoring an event like this you're technically not independent and should refrain from accepting the engagement - Deloitte's well known for not selling off its consulting arm, which could lead to exactly this sort of risky scenario. Smart money says they wouldn't bother with the risk associated with the VANOC audit and the perception of a glaring conflict of interest, but I'll have to dig deeper - or wait for someone to point out to me who's actually doing the audit!

Going back to last September, I witnessed a fun bit of bragging going on at a recruiting event, which I'll paraphrase for you:

Deloitte recruiter: "We won the right to be the official sponsor of the 2010 Games! Dig our official 2010 Olympics logo on all our audit reports!"

E&Y recruiter: "We're also cool! We sponsored the Freestyle Ski Team because we wanted to be directly associated with Canada's winners! Dig our cheeky 'Team 2010' scarves!"

It may be the gold and silver medals talking, but I'd say so far the E&Y strategy seems to have panned out best, in terms of associating one's firm with Canada's success.

I have to disclose that I'm a big fan of any company which rides the Olympic celebration bandwagon without shelling out the big bucks for an official deal: that's also why I love my sweet Valentine's idea of giving me a Starbucks card with the word "Canada" on it on top of a Whistler-esque scene.

As you can imagine, she's both brilliant and lovely.

Of course, it's been just a few hours since the gold medal victory occurred, so a cursory search for corporate press releases trumpeting the success of the skiers yields nothing that actually mines that potential association.

I really thought these marketing people would have celebratory notices ready to shoot out like some many well shaken bottles of champagne, but in all fairness, freestyle ski Canada hadn't updated their site the day of victory either - it took until the wee hours of Monday morning to tonight either - they hadn't gotten around to reporting on Jennifer Heils' win and skipped straight to celebrating Alexandre's victory. I suppose they run a tight ship and everyone was out, deservedly, partying like crazy rather than rushing off to their computers to publish the news.

But once the congratulatory messages join the growing chorus of cheering Canadians, I certainly hope Deloitte and E&Y come up with something better than, say this.

I was viewer #14 when I loaded the clip - which is a dismal hitcount. In all fairness, there's an English version too, but it features the same Green Dot from their logo and only had 308 views at the same point in time.

CAs are doing more than just coming up with questionable Youtube clips though.

They're much more deeply enmeshed in the games than the aforementioned companies with their sponsorships and consulting jobs - they're actually running the show as well, as the KPMG link above already suggested.

What that link didn't reveal, however, is that three of VANOC's top executives are CAs. This CA Magazine profile is a pretty good read, especially worth checking out if you're still asking that classic question, "what can I do after my hell years working in AuditLand?"

The first paragraph is a decent enough intro: "Of the gazillion things clamouring for Terry Wright’s attention, the one topping today’s list is food — lots of it — enough for 1,200 hungry athletes at a time, three times a day, every day, for more than two weeks. Wright, a CA and the executive vice-president of services and games operations for the Vancouver Organizing Committee for the 2010 Olympic and Paralympic Winter Games (VANOC), is snowed under a daily avalanche of to-do lists. With a day as tightly wound as a Victorian lady’s corset, timing is everything and, at this moment, food has top priority."

Oh, I did wince when I read the line about a "corset," but then I probably am guilty of more than my fair share of cringe-worthy phrases, so we'll give them a pass on that.

Enough of the professional navel gazing - Go Canada!

Keep your head up!

Post Script: can someone please take this fence down or replace it with something much less ridiculous? I'm calling out the CA execs who should know better.

New guide: how to successfully wait in line at a Polish deli

I really do wish the following tutorial was not necessary, but recent events have showed me that our education system has clearly failed us.

Now that there is an influx of people with absolutely zero life skills arriving in my neighbourhood, I have, as usual, found it thrust upon my shoulders to deliver a new guide on How to Survive Life.

Long-time readers will recall this site's brief master class on business travel.

The only thing it lacked to be considered the peer of workplace training was an introductory "You should be able to" Goals section, and a instructions at the conclusion regarding how to get your Continuing Professional Education credits. The new and improved courses delivered by A Counting School address those concerns.

How to successfully wait in line at a Polish deli

Upon completion of this course, you should able to:

• know how to stand in line to be served in a Polish deli, and
  
• not look like a cursed fool.

Lesson one: arrival.

Upon arrival, gauge the line. Find who was the last person, and make your way over to stand near them. Once they are served, you will be next.

If you are waiting to be served in a deli which is empty except for one other person, do not stand right by the doors where you entered if the available staff are at the opposite end of the store.

Instead, walk towards the middle of the store, and make yourself visible to the store's staff.

If the person who was ahead of you has to direct store staff towards you, you have failed. Complete your purchase as best you can; return tomorrow for more delicious food and to try again.

Lesson two: if necessary learn Polish, then use it

Even if the store recently hired Ukrainian, Romanian or other European shopkeepers, speak in Polish. It's the Correct Way.

They may respond in fractured English rather than Polish.

Ignore this and continue speaking in Polish as best you can. Bring a friend if necessary.

If you are not blessed with Polish friends, then Google translate has Polish-English translation modules to quickly get you up to speed in an awkwardly translated manner; My Life is Polish is also a rich source of contrived information to use in a vain attempt to try and fit in.

Lesson three: make sure you're in the right store

If you see a collection of products similar to that in the picture below, you are not in a Polish deli. You are in a garden supply store. Do not purchase, let alone eat, these items. They will sicken or kill you.

Leave immediately or you will have once again failed, and there will be no repeat option.

Lesson four: being ready to pay

Although many stores now accepted debit cards, don't hold up the line on busy shopping days.

Bring cash in the local currency, and save your plastic for your trips to IKEA.

Lesson five: waiting to pay

If there is someone ahead of you waiting to pay and your own purchases have been selected, the operative mode is for you to "stand there and stay quiet."

Once they have been served, have paid for their purchase, and collected their purchase, you will then be the focus of attention.

Example: you are watching the person ahead of you pay for their purchase. Money has changed hands, but their goods are still on the counter.

When the cashier asks, "do you need a bag," this question is not for you.

If you answer, you will show that you believe you are always the centre of attention.

Saying, "no," for example, will indicate inattentiveness at best, and gross egomania at worst. Saying "yes" is equally wrong, with the same consequences.

To successfully complete your shopping adventure, shut up, pay attention while you wait for your turn, and then complete your purchase.

If you failed, you may return tomorrow to try again. There is no limit aside from cost as to the number of times you attempt to pass this course, and your diet will continue to be rich in delicious food.

This completes this A Counting School internet based learning module.

To receive CPE credit for this course, visit your local Polish deli.

Bring cash.

Is Stolen Property taxable income? It is in the US! Amazing US tax law "Fail"/"Win"

 There's actually a rule on how to treat "stolen property" on your US tax return:

"Stolen property.   If you steal property, you must report its fair market value in your income in the year you steal it unless in the same year, you return it to its rightful owner."

Someone reported a robbery? 

As usual, I remind you that I'm not offering you any tax advice here - hire a professional if you need any of that. Of course, I don't think the target audience for this bit of tax law would even care about my disclaimer - they probably have other issues they should instead be dealing with.

What makes this funnier is seeing this featured on Failblog, although I stumbled upon it courtesy CPASuccess - thank guys, that's just epic. Possibly be an epic win rather than a fail depending on how you look at it, though.

I was going to say "I don't have the US tax code on hand to verify if this is in fact real," when I first saw it on their blog, but then I skipped back to the start of their post and then I realized CPASuccess actually linked to it, it's right there in Publication 17 - here's the hotlink. Yes, the Americans did decide to publish their tax code online.

Sweet!

The legends were true. I love how the US Government cleverly includes this "Other Income" line, which allows them to nail people for tax evasion if they somehow can't arrest them for the theft itself. How they would prove this is another matter altogether, but it makes you smile knowing that this is actually on the books.

Wouldn't it just be fitting to see a grassroots movement to declare certain US government 'subsidies' to be considered "theft" for this purpose to round out the tragic comedy here?

Can you get your 51 CA credits in a year and a half?

If you started, say, an engineering program at one given university, could you switch partway through to a Chartered Accountant prep program instead in the same university's business school, and quickly get all the credits you need to graduate in a mere year and a half?

One of the regular CA 'commentators' on the blogs and forums, sardaukar - who does an excellent public service in opening people's eyes to the "hell years" that await them as CA students, incidentally - did just that, and people wondered how this is even possible.

Since I'm not really into Sudoku, and this is just the sort of "puzzle" I enjoy solving, I'll answer the question for the writer of comment #427.

The funny thing about this exercise is that when you review the list of courses needed - I include links at the end of this article - many courses will count for "3 hours" even though they're full year, or half year. That means you can't divide 51 by 3 and decide that means you have to take 17 full year courses. Neither does it mean you need 17 half credits - you have to review the whole list. In addition, the University of Toronto requires that you take 20 credits in total to graduate, unless you started in 2000, the last year I'm aware of where they allowed you to finish with a three year degree.

Remember that the example we're dealing with involves someone who took electrical engineering - doing a quick edit before hitting "publish", yes I do that, made me realize I missed one assumption on my first run. I left my mistake in the post, but you'll see my correction at the end of the post.

The army of Chinese elementary school students leaving class just before the clock struck 6 p.m. is an image that somehow pops up when thinking back to the Commerce program. Very strange reason given the distinct lack of jumpsuits and long days in the classroom.

Your typical engineer faces a situation where the extra credits to hit 20 are already accounted for - let's take a look at what you need year-by-year, along with comments.

• First year: Economics, Intro Commerce and Math.

An engineer will have math accounted for no problem, and it'll be "hard math", not the "easier" Commerce math course with which you can squeak by, and still end up learning more than you will ever end up actually using. Running tally: 2 full year credits - excluding the math credit I presume you already got prior to deciding to become a CA. I was happy to get into the Commerce program without having to take the "Intro Commerce" full year program. I'm sure it's quite useful and helps give you a "big picture" of what you're getting yourself into, but I managed just fine without having my hand held by the Commerce administration in first year, thank you.

• Second year: For the ECO side, Microeconomics and Stats. For the Commerce side, Financial Accounting, Intermediate Financial Accounting I, Management ("Cost") Accounting and the Legal Environment of Business ("Krupo's other favorite").
  
• Plus add choice of side salad, fries or baked potato (translation: Financial Markets, Marketing, or Organizational Behaviour)
  

The "ECO" credits are both full year, the "MGT" credits (they call the course codes "RSM" after the wealthy Mr. Rotman's generous donation to the program, but like hell I'm going with the new taxonomy, I'm a product of the Old School) are all half credits. If I can still add despite being a CA, that's 4.5 more full year credits in total - running tally: 6.5 full year credits. Second year, if you were not rushing, would involve a nearly-full plate of courses in the Commerce program.

Two other fun facts about second year: the "Legal" course, which I loved, was previously a third year course, but for whatever reason they bumped it up earlier in the schedule, perhaps to encourage students to get to it sooner. Macroeconomics, to my dismay, is "strongly encouraged" but not required. That's a pity, and no doubt explains why someone in this stream would no longer be an automatic Economics Major. I find one of the strengths of becoming a CA is the strong background you get in Economics, which is why this development is such a shame.

• Third year: Intermediate Financial Accounting II, Advanced Financial Accounting Topics, Managerial Accounting and Decision Making ("Advanced Cost Accounting"), Auditing I ("Welcome to AuditLand"), and Canadian Income Taxation I ("Personal Tax. Those of you at Big Four firms may never again touch this topic after the UFE unless you leave for a smaller firm or do your own/friends taxes later"). The Finance MGTs: Capital Market Theory and Intro to Corporate Finance

There you go - 3.5 MGT credits plus an ECO of your choice* - total 4.5, running tally 11 full year credits.

A few more observations are in order - shoving the fourth year taxation course into third year is pretty clever, as it makes Rotman's students more competitive when applying for summer jobs with accounting firms, having some formal tax learning under their belts. Good call there. Advanced Financial Accounting is another fourth year course moved up in the queue. Presumably to also get those interns and summer co-ops in a stronger position in their summer jobs, I guess.

Splitting the full year Finance course into two halves was a surprise to me. Perhaps the ICAO's requirements were behind this. If anyone knows I'd be happy to know more behind that split, but nothing shocking there.

*There's that little asterisk popping up like a delightful footnote warning you that we've stumbled upon something that mildly infuriates me more than dropping Macroeconomics from the "required" list, and that's the list of courses you can't take towards your requirement. That "your choice" excludes what looks like the entire list of third and fourth year Economic History courses, it seems. Perhaps one or two snuck through, but my quick review suggests that this is not the case. Maybe this was always the case; the Economic History credit I took perhaps not doubt counted only towards my history minor and economics major, but I consider discouraging Commies from studying the lessons of the past an idiotic path to embark upon.

My friends agreed that the Economic History course we happened to take - Canada's, in case you're curious - was one of the biggest eye-openers throughout university. The amount of intellectual maturity a course like that can bestow upon you is simply amazing - it's one of those courses you hope to experience. The kind that makes you challenge everything you're taught in the other "this is how things work, don't question it and you'll do fine" courses.

If anything, taking something that makes you really think should be made mandatory. Anyway, let's climb off the soapbox and check out what lies ahead.

Let's not even get me started on taking the third year "Business Information Systems" course down from "required" to "strongly recommended." CAs need to be strong on their IT skills. Or at least not laughably deficient. Removing this course from the "required" list is a poor choice, although it definitely brings you a half credit closer to your target of rushing through the courses to get your "51 hour requirement" with a minimum of fuss.

• Fourth Year:  Management Control, Auditing II ("Going deeper into Auditland"), Canadian Income Taxation II ("Welcome to the Suck"), Critical Thinking, Analysis and Decision Making ("U of T's UFE Prep course. Please do well here, and can one several of you please then get on the Honour Roll to get us to stop looking bad compared to Laurier?"), and Auditing and Information Systems ("Krupo's favourite")
  

Six more half credits, equal three full year courses. Running tally: 14 full year credits.

It would be 15, but as I stated above, but we'll assume you already nailed the first math requirement as an engineering student.

Come to think of it, an engineer would probably already have taken a "hard stats" course, so you're down to the need to take 13. Missing "Stats" is the mistake I alluded to at the start of my post - did you catch it? If so, you win five bonus points, now add them to your Hello Kitty scorebook.

Is the 1.5 Year Thunder Run possible?

So can you do it in 1.5 years? Last time I checked, you can take 2 courses per summer term - and possibly 3 with special permission, if they still allow you to apply for that option - and 6 credits per winter.

Let's hold off on the "special beg" and see what we get as a "normal" student: start in "summer one" with 2, take a "full winter" of 6, and "summer two" with another 2. That's 10 credits right there. Then take your last three credits during half a winter term.

Boom, CA credits accounted for in a "long" year and a half.

Definitely doable, albeit at the cost of a couple of your summers: you're ready to graduate since I've assumed your engineering courses gave you math, stats and the other five credits you needed, no doubt including the "science breadth requirement".

In fact, if you could petition to "overload" your schedule and take 3 courses in summer and 7 in the winter term, you could start the process in September and finish it in August the next year - basically one calendar year!

Even hardcore Engies used to killing themselves with long hours of coursework might, however, find that a bit on the ridiculous side. Not that I doubt they could handle the load, but the more realistic argument for "spreading" things out over the extra half year or so is the schedule of "pre-requisite" courses which would conspire to slow down your sprint through the course catalog.

Edit: after I finished writing up this post I saw a follow-up post by Sardaukar explaining that the economics course were done as the "Engineering electives" prior to entering commerce. That reduces the load of courses even further, with the first, second and third year courses off the radar - all you then need is 10 credits, done with two summers and a winter term.

Source?

If you're wondering where all this information came from, you just need to search for the ICAO's 51 course credit requirements, or just skip that step and check out my links to the ICAO's webpage for the Rotman Commerce program, which then leads you to the Rotman page itself. There's also a detailed ICAO page for people who don't feel like getting a "Specialist in Accounting" designation, but they'll be one course short of the full 51 credits - that list is here.

The ICAO is quite helpful for everyone in Ontario, mind you - a list of all other schools is also available here if you're attempting this from any other place in the province.

To answer one question I already heard, the secret to this approach is doing it at the same university. Generally speaking 100% of your credits are transferable within the same school. When you start jumping from school to school you encounter limits on the number of "transfer" credits which are eligible for your degree - some limit you to 5 which would make the above strategy, which relies on 7 credits, less feasible.

Is this approach insane? Well I didn't it, but it's both doable and has been done - I welcome your comments - click here to start leaving them.

If you got all the way to the bottom of this admittedly lengthy post you must be a superfan - so it's worth mentioning to you that I somehow got listed a while ago on the top accounting sites "magazine rack" at Alltop. Thanks, readers, for following along the adventure.

How much do first year CA students make in Canada?

If there's one question students in university may find hard to ask - even though it echoes in their mind all the time - it's "how much am I going to earn if I get hired by a CA firm?"

If you're bold and outgoing and have friends who are already employed, this can be easier to find out. Otherwise, hopefully you'll stumble across either this post or the next forum as you turn to the all-knowing internet for answers.

Stefano at mycasite took it upon himself to contribute to our collective knowledge by conducting a public survey - you can see the results here and comment on the outcome in this dedicated forum.

He reports that the range of median salaries runs from $29,300 in Winnipeg to $45,000 in Toronto, with the size of the firm - big four or regional - playing less of a role than some might expect.

A fair question you may ask, though, is why there's a 50% increase just for moving over one province. This is explained by the fact that regional pay depends on the cost of living in various places across Canada, with Toronto being arguably the most expensive place.

Since we'll talk about quality of life, note that pretty much any CA student has it made, compared to people in most jobs in most of the world, unless you happent o enjoy pulling your own cargo rickshaw through insanely smoggy air.

The only area where the "cost of living" explanation falters is with the notable exception of Vancouver, which is notorious for being as expensive as Toronto - if not moreso - but with a market for CA students that ends up paying six thousand less.

Commerce and business students contemplating their future will not doubt weigh their options with this in mind. Chartered Accountants, having to take enough credits to earn a major in economics, no doubt keep in mind the fact that other professions compete for their strongest potential candidates, so wages have to track that accordingly.

Factors no doubt considered include the fact that knowledgeable students are aware that they'll be getting some significant benefits, both educational and financial from picking this route - you can roughly estimate the support an average CA student receives on their first UFE attempt in the neighbourhood of ten thousand dollars - as long as you pass on your first shot those costs are usually covered by your employer. Repeat writers suffer the burden of their additional attempts, which of course can add an additional level of stress to the exam writing attempts if you fixate yourself on it.

Money isn't everything though - a career in high finance will be more to your liking if you disagree though!

If you value your spare time, the quality of life you'll be enjoying in and outside of work is worth considering. Thinking back to the case of Vancouver, who wouldn't want to live with a milder climate, oceans, mountains and this year a Winter Olympiad too? Combine the higher population of people willing to live and work there with the conditions of the local economy and you get a more detailed explanation as to why average starting compensation is relatively lower there.