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Regulations

Use of Non-GAAP measures in executive compensation

Dec 19, 2019

On December 19, 2019, the Canadian Coalition for Good Governance (CCGG) released a position paper provides that provides a summary of their study to review the compensation structures of a representative group of 100 public companies listed on the S&P/TSX Composite Index and includes recommendations for improved disclosure on the use of these measures by public company boards.

In the normal course of our review of corporate disclosure and ongoing engagement with public company boards over the past several years, CCGG has noted an increasing prominence of non-GAAP performance measures in the incentive compensation programs (both short-term and long-term) of Canadian public companies. It is not uncommon for boards to apply the highest weighting to these unaudited and, often, adjusted measures when determining incentive compensation awards for senior management.

Review the press release and position paper on the CCGG's website.

Striking the right balance between sustainable development and sustainable debt

Dec 19, 2019

On December 19, 2019, the International Monetary Fund Blog (IMFBlog) published a blog on how over the past two decades, sub-Saharan Africa has made considerable economic progress: extreme poverty levels have declined by one third; life expectancy has increased by a fifth; and real per capita income has grown by about 50 percent on average. Yet, sub-Saharan Africa is still only half-way to meeting the Sustainable Development Goals.

To achieve these goals, sub-Saharan Africa will need financing. One of the ways to access financing is through borrowing. It makes sense for governments to incur debt if done wisely. If debt is used to finance projects that boost productivity and living standards, such as investing in roads, schools, and hospitals—and if governments can recoup enough of the benefits of these investments to repay the incurred debt—then borrowing is worthwhile.

Review the full blog on the IMFBlog's website.

COSO and Deloitte Issue Guidance on Cyber Risk

Dec 17, 2019

On December 17, 2019, in collaboration with Deloitte Risk & Financial Advisory, the Committee of Sponsoring Organizations of the Treadway Commission (COSO) released Managing Cyber Risk in a Digital Age.

The guidance provides “an overview for business executives and board members on cyber risk management through principles defined in the COSO Enterprise Risk Management Framework.”

Review the press release and guidance on COSO’s Web site.

IESBA Meeting Highlights December 3-6, 2019

Dec 17, 2019

On December 17, 2019, the International Ethics Standards Board for Accountants (IESBA) released the highlights of its December 3-6 meeting.

Discussion points included:

  • Fees
  • Definitions of listed entity and PIE
  • Non-assurance services
  • Technology
  • IAASB-IESBA Coordination
  • eCode
  • Tax planning and related services
  • Code rollout
  • Emerging Issues and Outreach Committee (EIOC)
  • IFAC global status of adoption report
  • Role and mindset

Review the highlights and podcast on the IESBA's website.

Framework consultation launches to drive uptake of nature-related financial disclosure globally

Dec 05, 2019

In 2019, the Climate Disclosure Standards Board (CDSB) announced the launch of a consultation with the aim of accelerating the rate of nature-related financial disclosures at scale by organisations globally and exploring the role of the CDSB Framework in facilitating this.

Review the press release and consultation on the CDSB's website.

Boomer’s blueprint: Entrepreneurial leadership

Nov 27, 2019

On November 27, 2019, Accounting Today published an article on how leadership has always been important, but is critical during the transformation of a profession.

Entrepreneurial leadership has its own characteristics, both good and bad depending upon your perspective. Entrepreneurs are also associated with innovation, and every accountant should realize that all innovation starts as a bad idea — at least to those it disrupts. Therefore, innovation management is becoming a required skill where a person has the unique ability to make things happen “from idea to making it real,” and then it requires an innovation team to make it scale.

Review the full article on Accounting Today's website.

IFAC Launches "Exploring the IESBA Code"

Nov 26, 2019

On November 26, 2019, the International Federation of Accountants (IFAC) released the first installment in a new informational series to promote the Code of Ethics.

Professional accountants and other business professionals are often faced with complicated, real world situations that are not black and white and demand pragmatic and ethical solutions. To help address these challenging situations, IFAC released a new series titled: Exploring the IESBA Code.

Through twelve monthly installments, Exploring the IESBA Code will take an in-depth look at the International Code of Ethics for Professional Accountants (including International Independence Standards) (the Code).  Each installment of the series will highlight different aspects of the Code in real-world situations, in a manner that is relatable and practical. A special focus will be placed on recent revisions to the Code.

The first installment of the Exploring the IESBA Code deals with the five Fundamental Principles of ethics, which establish the standard of behavior expected of all professional accountants - a standard which enable accountants to uphold their responsibility to act in the public interest.

Review the press release and new series on the IFAC's website.

Calculating the value of impact investing

Nov 25, 2019

In 2019, the Harvard Business Review (HBR) released an article on how as concerns about scarcity and inequality become increasingly urgent, many investors are eager to generate both business and social returns—to “do well by doing good.” One avenue is impact investing: directing capital to ventures that are expected to yield social and environmental benefits as well as profits.

But there’s a problem: Although the business world has several universally accepted tools, such as the internal rate of return, for estimating a potential investment’s financial yields, no analogue exists for evaluating hoped-for social and environmental rewards in dollar terms. Forecasting gains is too often a matter of guesswork.

Investors hoping to use a company’s track record on social and environmental impact to assess future opportunities will similarly find little useful data to evaluate. The reporting of environmental, social, and governance issues is now standard practice at nearly three-quarters of the world’s large and mid-cap companies, but it is usually confined to information about commitments and process and rarely scores actual impact on customers or society.

Review the full article on the HBR's website.

 

Filling the Pipeline: Advancing More Women into the C-suite and on Corporate Boards

Nov 20, 2019

In 2019, the Conference Board released a publication asking why have we not seen significant results from diversity and inclusion programs geared toward women? Why are we not seeing more representation in the C-suite and senior leadership roles?

Traditional D&I programs only scratch the surface of what it takes to help women move ahead. For one thing, women need both male and female sponsors—having only other women as mentors can hold them back. Further, many programs have been too focused at an individual level—effectiveness requires a holistic corporate-wide approach because, without a culture change within and throughout an organization, “second-generation” gender bias, stereotypes about women’s leadership abilities, and lack of access to male networks will continue to systemically impede women’s advancement.

Review the publication on the Conference Board's website.

Integrated thinking, reporting and sustainability

Nov 19, 2019

On November 19, 2019, Accounting Today released an article on how we work with standards and systems that are entirely wrapped around the notion of protecting the investor and the returns due to them. However, these views are being challenged and we see it in current political debates around the world.

Individuals are critical of the short-termism that current systems encourage, and they are reflecting on how to change things for the better. Now the focus is upon shifting to wider societal obligations — how to deal with the current issues of jobs and employment, long-term profitability, sustainability and the implementation of technology? These real issues are the ones that past business leaders have not had to deal with. However, they represent an opportunity for the accounting profession to play a role in engaging with clients, businesses and colleagues, to help society evolve so it becomes resilient for the long term.

Review the full article on Accounting Today's website.

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