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May 2020 - PP News & Views

Guidance Available on Accounting and Auditing Issues Related to COVID-19

As practitioners turn their attention to year-end engagements, some have questions about how the impact of COVID-19 should be reflected in financial statements for years ended December 31, 2019 and March 31, 2020.

CPA Canada has published the following to assist practitioners:

  • ASPE Alert: Download this guidance to learn whether companies applying Accounting Standards for Private Enterprises (ASPE) in Part II of the CPA Canada Handbook – Accounting should adjust annual financial statements issued in 2020 for the effects of COVID-19.
  • ASNPO Alert: Download this guidance to help your not-for-profit organizations applying Accounting Standards for Not-for-Profit Organizations (ASNPO) in Part III of the CPA Canada Handbook – Accounting determine whether they should adjust annual financial statements issued in 2020 for the effects of COVID-19.
  • Review COVID-19: MD&A disclosures in volatile and uncertain times for considerations when preparing management’s discussion and analysis (MD&A) disclosures.

In addition, we thank CPA Quebec for sharing guidance on the challenges of a physical inventory count during the COVID-19 pandemic.

For other pandemic-related resources, please visit the CPABC and CPA Canada websites.

Assisting Clients with Government Subsidy Applications

During these challenging times of COVID-19, both federal and provincial governments are helping individuals, businesses, not-for-profit organizations, and other enterprises through several grant and subsidy programs. Public practitioners are being asked by their clients to provide guidance as to their eligibility of these programs and/or to prepare application forms for these benefits on their clients’ behalf.

We remind public practitioners of some of the requirements in the CPABC Code of Professional Conduct as they provide services to their clients regarding these government programs.

Rule 202 Integrity and due care and objectivity

Rule 202 requires public practitioners to perform professional services with integrity and due care and not allow their professional or business judgment to be compromised by bias, conflict of interest, or the undue influence of others. As a client’s eligibility for COVID-19-related programs might rely on revenue reductions or other thresholds, it is crucial that practitioners be careful not to allow clients to unduly influence their professional judgement.

Rule 205 False or misleading documents and oral representations

Public practitioners might be preparing letters, reports, statements, representations, or financial statements to assist their clients with COVID-19-related government programs. Practitioners must remember:

  1. not to sign or associate with any of these documents or representations that they know, or should know, are false or misleading, whether or not the signing or association is subject to a disclaimer of responsibility; or
  2. make or associate with any oral report, statement, or representation which they know, or should know, is false or misleading.

Rule 206.1 Compliance with professional standards

Public practitioners are required to perform professional services in accordance with generally accepted standards of practice of the profession.

Rule 213 Unlawful activity

Public practitioners are reminded not to associate with any activity that they know, or should know, to be unlawful. This is a very short but powerful rule to remind clients should practitioners be faced with inappropriate pressure.

Finally, public practitioners might need to educate their clients regarding the nature of these government programs and the related tax treatment so as to avoid cash flow difficulties down the road. Whilst COVID-19 government-related benefits and programs can greatly assist clients in their time of financial crisis, practitioners must apply caution and maintain their ethical standards when assisting clients in determining eligibility.

Beneficial Ownership Changes Delayed

Members learned about new beneficial ownership rules across Canada in the of January/February 2020 issue of CPABC in Focus. In BC, the compliance date of the new requirements has been delayed to October 1, 2020. Read BC Corporate Beneficial Ownership Registry General Information on the CPABC website for all the details.

New Provincial Practitioner Discussion Forum  Created

Are you looking for a venue to discuss accounting or auditing issues related to COVID-19?

The Member Advice and Programs team at CPABC has created a new Provincial Practitioner Discussion Forum for members to help each other deal with the impact of COVID-19 on financial reporting. This forum will meet periodically online during the epidemic to discuss guidance published by CPA Canada. This forum is open to all licensed practitioners in BC. Interested members can sign up by emailing ProfessionalAdvisory@bccpa.ca.

Find COVID-Related Webinars

With so many suppliers providing webinars to help businesses cope with the COVID-19 pandemic, CPABC has curated a number of them from trusted sources onto one page of our website to make it easier for member. Check them out on the COVID-19 Webinars section of our  COVID-19 Updates and Resources webpage.

CPAs at Forefront of Urban Adaptation to Climate Change

In response to climate change, the City of Vancouver, along with Toronto and Montreal, has partnered with CPA Canada to develop a financial reporting and capital investment guide for municipal decision makers.

If you serve any local governments, learn how climate-related information can support municipal stakeholders with short-term budgeting, long-term capital planning, and enhance the usefulness of a city's public financial reports by downloading this guide from the CPA Canada website.

For more information, watch this Implementing the TCFD Recommendations webinar which focuses on practical implementation of the recommendations and highlight disclosure examples.

Changes Proposed to Independent Schools Reporting

It has come to CPABC’s attention that changes to Independent School Regulation are pending approvals and the required regulatory amendments. If you serve the independent schools sector, be sure to check with your clients as to any reporting changes being proposed for the 2019/2020 school year.

CRA Shares Fraud Protection Tools

By now, almost everyone has received some sort of scam CRA call. The Canada Revenue Agency is offering more information in their Slam the Scam campaign to help Canadians protect themselves from fraud. The information is available in multiple languages for you to share with your clients.

If you or your clients think you might be a victim of identity fraud or have given away personal or financial information, you can:

  • report the case to the Canadian Anti-Fraud Centre online or by calling 1-888-495-8501;
  • call CRA to ask for extra security to be placed on your account;
  • contact Service Canada at 1-800-206-7218 if your social insurance number has been stolen;
  • call CRA to cancel online access to your information in the CRA login services; and
  • find out if you qualify for taxpayer relief for interest or penalties you are charged because you are not able to meet your tax obligations as a result of the fraud.