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Inside Internal Controls

News and discussion on implementing risk management

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Internal Controls

Monitoring controls: The top ten tax controls

At year end, external auditors heading into the tax department do not generally rely on internal controls to reduce testing; a great deal of effort is focused on substantively testing the income tax balances on the financial statements. Tax processes are notoriously manual in nature with numerous adjustments required to manipulate general ledger information into useable tax information. We have compiled a list of the top ten tax controls every company should have in place with the emphasis (as expected) on monitoring controls.

 

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Succession planning: Apple did it right; why do so many do it wrong?

Lululemon announced Monday that chief executive officer Christine Day will be stepping down after a five-year tenure. Shares plummeted after the statement, down 15 percent by Tuesday morning. During her time as CEO, Day helped grow the high-end yoga brand’s sales to more than $1 billion annually. It’s clear that CEO transitions present a great deal of risk for shareholders, especially as new perceptions are formed. So what’s the best way to deal with risk mitigation during publicized CEO transitions?

 

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Slaw: The state of whistleblowing in Canada

Whistleblowing occurs when employees reveal corporate wrongdoing, usually in their organization, to law enforcement. Unfortunately, it is common for whistleblowers to experience demotion, dismissal and otherwise negative treatment from their employers after they disclose the malfeasance or corruption. In order to deal with this serious issue, some companies have created codes of ethics to ensure that their directors, officers and employees are aware of and adhere to standards of conduct that ensure the company performs and is represented in an honest and responsible manner.

 

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What to do if you are a victim of cyberbullying or cyberlibel – Part 1

In last month’s posting, I wrote about the tragic case of Rehteah Parsons, the Nova Scotia teenager who took her own life after being cyberbullied. I have since received requests for some of my readers for advice on what to do if you are a victim of cyberbullying. I will respond to this request in two postings. The first is meant for parents of children who are being cyberbullied. The second, which will appear in next month’s posting, is meant for adults that are victims of cyberlibel or cyberbullying. This information can also help businesses take steps to support employees and manage the risk of cyberlibel or cyberbullying in their organizations.

 

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Why your organization needs a Tax Plan Implementation Review (TPIR)

Board members and senior management are quite familiar with compliance requirements for CEO and CFOs certification and the importance of maintaining strong internal controls over financial results. The certification process extends to internal controls over income taxes balances in the financial statements. For the majority of companies with a well-staffed tax department, monitoring controls remain the strongest control and most frequently used. Senior management is however, frequently unaware of the potentially material risk associated with tax plans implemented in the past; undergoing an annual TPIR assists in mitigating this risk to a manageable level.

 

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Ontario Not-for-profit Corporations Act delayed

I’ve lost count of the coming-into-force dates the government has set for the Ontario Not-for-profit Corporations Act to take effect, but this time at least it seems there’s a clear reason. The previous estimate for the law to come into force was July of this year; the new estimated date is “no earlier than” January 2014.

 

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Taking matters into your own hands: dissolving before the government does it for you

Readers will know that the new Canada Not-for-Profit Corporations Act came into effect in 2011, bringing the regulation of not-for-profits into line with modern corporate legislation. This carries with it the onus to apply for continuance under the new Act by October 2014, or be dissolved.

 

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COBIT evolves as technology does

CobiT 5 was released in 2012. It takes a higher-level governance approach, focusing on stakeholders and their needs. It incorporates the internal control focus of earlier versions of CobiT but goes beyond them.

 

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The importance of internal controls when filing the annual T3010 information return

One look at the recent charity headlines should remind charities of the importance of internal controls when it comes to filing the annual T3010 information return (also known as a charity’s tax return).

 

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Contract administration – beyond the handshake agreement

Unfortunately, it is not unusual for not-for-profit organizations to find they have entered into a contractual relationship that did not receive the required level of oversight, discussion and approval. Such contracts dramatically increase the risk of harm to your organization.

 

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A failure of governance at THS

Behind the headlines of sick animals, the real story of the Toronto Humane Society is one of failed governance.

 

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The cynical blather about HST

You’d think that in tough economic times, political parties might get together to support public policy that is fiscally progressive, good for business and (if the experience of Atlantic Canada is anything to go by) not such a bad deal for consumers. But you’d be wrong.

 

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Another perspective on ECPA

In a previous post, I commented that the Industry, Science and Technology Committee made relatively few amendments to Bill C-27, the Electronic Commerce Protection Act (ECPA). Now, McCarthy Tétreault has analyzed the Committee’s changes, and concludes that, from its perspective, some but not all of the most troublesome aspects of the Bill have been amended.

 

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