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2018

2018 Report to the Nations on Occupational Fraud and Abuse

Apr 30, 2018

In April 2018, the Association of Certified Fraud Examiners (ACFE) released their biennial report, which is based on thousands of fraud cases reported by fraud examiners worldwide and provides a detailed look into how fraud is being perpetrated, detected, and combatted in various industries and regions worldwide.

Occupational fraud continues to siphon staggering amounts of money from businesses worldwide, with smaller organizations being hit particularly hard.

That’s one of the trends identified in the 2018 Report to the Nations on Occupational Fraud and Abuse, released by the Association of Certified Fraud Examiners.

Review the announcement and the full report on the ACFE's website.

2018-2019 federal budget highlights

Feb 27, 2018

On February 27, 2018, the Minister of Finance, Bill Morneau, presented the 2018-2019 federal budget in the House of Commons. Key themes include growing the economy, gender equality and innovation. While the budget did not respond with any specific measures, the government acknowledged the significance of recent US tax reform and current negotiations of the North American Free Trade Agreement.

Some of the key features of the budget plan were:

  • Following the proposals announced last year, the budget has introduced legislation to address the earning of passive income inside a private corporation.
  • From a gender equality perspective, the budget announces the introduction of a new “use it or lose it” Employment Insurance parental sharing benefit which will enable two-parent families that share parental leave to receive an additional five weeks of leave.
  • The government is introducing significant new investments to better support Canadian innovators.
  • The government continues to introduce measures to close loopholes that result in unfair tax advantages for some at the expense of others.
  • Of note, the budget does not include further measures to address recommendations from the Organisation for Economic Co-operation and Development’s base erosion and profit shifting project, particularly with respect to interest deductibility and anti-hybrid measures.

A summary of the economic and tax highlights contained in the budget is outlined in our Canadian tax alert.

2018-2019 New Brunswick budget highlights

Jan 30, 2018

On January 30, 2018, New Brunswick’s Minister of Finance, Cathy Rogers, presented the province’s 2018-2019 budget.

The budget focused on three key priorities:

  • Investments in seniors;
  • Youth employment; and
  • Economic competitiveness.

The announced changes to taxation in New Brunswick are outlined in our Canadian tax alert.

Are graphics really good?

Jan 08, 2017

On January 8, 2018, Cooley Pubco, the blog of law firm Cooley LLP, published an article on how the inclusion of graphics in lieu of copious text has been almost de rigueur in proxy statements for several years, as a way to facilitate comprehension of sometimes complex data. However, some forms of visual presentation may be a lot more useful than others.

In an article on CFO.com, featuring some graphics does make sense because research has shown that people process visual information faster than verbal information.

Graphics can have an impact on the information perceived, such that where a report includes both text and graphics, the audience is likely to lend greater weight to the graphical information. On the other hand, sometimes graphics may not convey information clearly or efficiently.

Review the full article on Cooley Pubco's website.

Also, refer to our Annual Review Guide for guidance on financial reporting disclosures.

Are the Reports that the DOL Guidance Will Lead to the Demise of ESG-Focused Plans Greatly Exaggerated?

Apr 30, 2018

On April 30, 2018, Davis Polk & Wardwell LLP posted a briefing on how there has been some speculation that perhaps the positions outlined in the bulletin issued by the U.S. Department of Labor related to considerations of Environmental, Social and Governance (ESG) factors by ERISA plan fiduciaries would act as a speed bump to the increasing focus by investors on ESG matters at public companies.

The Bulletin makes clear that plan fiduciaries in managing and investing plan assets cannot assume greater investment risks, or sacrifice investment returns, to fulfill social policy goals.

Also, fiduciaries can participate in proxy voting and other shareholder engagement activities if there is a reasonable expectation that such activities are likely to enhance the economic value of the investment after taking into account the costs involved.

Review the full briefing on Davis Polk & Wardwell LLP's website.

Are we putting too much trust in blockchain?

Apr 23, 2018

On April 23, 2018, the National Magazine of the Canadian Bar Association published an article on blockchain. Some compare this to the advent of the internet. It’s unclear, however, if some of blockchain’s more stubborn obstacles, like scalability and governance, will be cleared any time soon.

According to Hanna Halaburda, a senior economist at the Bank of Canada and visiting professor at New York University: “It’s not proven either way. It may never work. Right now, we don’t have the technology that cuts out the middleman. Getting rid of trusted third parties is actually very difficult.” The big hope is that this technology will eventually allow for the removal of all gatekeepers.

But even after several years, developers haven’t yet managed to work out some vexing problems that are putting the breaks on mass adoption of blockchain. Apart from scalability, the limits on possible transactions, another systemic challenge is the massive energy drain of the most popular consensus and verification system. The fact that no one entity is supposed to be in charge makes problems much trickier to solve, particularly when taking into account the various cultures of participants.

Review the full article on National Magazine's website.

At the Crossroads: Innovation and Inclusive Growth

Feb 08, 2018

On February 8, 2018, the Bank of Canada published remarks by Carolyn A. Wilkins, Senior Deputy Governor of the Bank of Canada, given at the G7 Symposium on Innovation and Inclusive Growth. In her remarks, she discusses how technological advances can leave people behind. It is perhaps only in the last decade or so that mainstream macroeconomists have sharpened their focus on how income distribution may affect long-term growth and macro dynamics.

There is compelling evidence that innovation has been an important reason behind rising income inequality in advanced economies in recent decades.2 Research also finds that rising inequality can result in weaker and less-stable macroeconomic outcomes. This places us, as policy-makers, at a crossroads. Do we choose to stay on the same road and repeat the past? Or do we apply fresh thinking to policy and choose a new road where innovation delivers even stronger and more-inclusive growth?

This is the challenge that the G7 countries have set for themselves for 2018. Canada is proud to lead the G7’s work this year to better understand the issues so that we can set priorities for policy.

Review the remarks on the Bank of Canada's website.

Big data and innovation: Key themes for competition policy in Canada

Feb 19, 2018

On February 19, 2018, the Competition Bureau (the Bureau) of the Government of Canada released its final report on Big Data and Innovation: Key Themes for Competition Policy in Canada, which summarizes the Bureau’s enforcement approach.

For mergers and monopolistic practices, the Bureau will continue to apply its traditional framework to market definition, market power and competitive effects. Where issues concerning big data are involved, the Bureau will consider both the efficiencies and consumer benefits from a network, but also whether big data could impose barriers to new competition or soften competition between firms.

Review the report on the Bureau's website.

Bringing Your Annual Meeting into the Digital Age

Jan 30, 2018

On January 30, 2018, Fasken LLP released an article on how public companies need to bring their annual meetings into the digital age and to use them as an effective means of communicating with a large number of shareholders and with the investment community in general.

A revamped annual meeting may even lead to reduced costs when compared to the traditional model of renting a conference room at a hotel and providing refreshments, as modest as they may be, for shareholders.  Canadian corporate law provides a framework which can be used to increase shareholder access to annual meetings and to maximize the impact of annual meetings.

Review the full article on Fasken LLP's website.

Can Blockchain Really Change The Financial Suite?

May 09, 2018

On May 9, 2018, Financial Executives International (FEI) published highlights from a report survey issued by Financial Executives Research Foundation (FERF), which looked at the growing promise and practical challenges of applying blockchain solutions to financial reporting and accounting work.

The report, sponsored by Deloitte, interviews industry leaders, academics and practitioners regarding their hopes distributed ledger technology. The paper also includes a survey of of financial leaders regarding the current use of cryptocurrencies like Bitcoin and their plans to adopt blockchain solutions in the future.

Review the highlights from the report's survey on FEI's website.

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