www.lexisnexis.ca Vol. 30, No. 4 April 2014
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Financial advisor bill sparking heated debate

The longstanding debate around the regulation of financial advisors in Canada has intensified following the recent release of a private membersí bill in Ontario that a major industry participant charges could add more confusion to the public discourse.

The Financial Advisors Act, 2014, sponsored by Rick Bartolucci, a Liberal member of provincial parliament from Sudbury, seeks to regulate who can practice as a financial advisor in Ontario, regardless of the products they sell such as insurance, mutual funds, or investments.

"The current system includes a series of disconnected rules that evolved over time and fall under various government ministries. While well intentioned, the status quo is a mishmash of policies that can allow unscrupulous financial advisors to slip through the cracks. My new bill, if passed, would provide clear rules within a standardized system for credible financial advisors, and would safeguard Ontarians," Bartolucci said in a press release.

States shelving rotation idea, Canadians will shed few tears

After massive pushback from the accounting profession, the corporate world and other stakeholders, the U.S. Public Company Accounting Oversight Board has shelved its project on mandatory auditor rotation.

In his annual budget audience with officials from the Securities and Exchange Commission in February, PCAOB chair James Doty said "we donít have an active project or work going on within the board to move forward on a term limit for auditors." Doty added, however, that the PCAOB would "continue to think about what impacts independence."

Good idea, said Brian Hunt, CEO of the Canadian Public Accountability Board.

Agreement trims weighty FATCA concerns

 

The much-talked about Foreign Account Tax Compliance Act (FATCA) is generating new buzz, after a recent agreement by the U.S. and Canada that aims to make it easier for financial institutions to comply with the legislation intended to crack down on illegal offshore accounts, and no longer places them in an untenable legal quandary.

FATCA, enacted by the U.S. government in 2010, originally called for banks and other financial institutions to disclose information about their U.S. account holders directly to the Internal Revenue Service. Compliance with this requirement potentially put banks in violation of Canadaís privacy laws.

Feds to explore new CCA class

Amid a staid budget expected merely to set the stage for an initiative-filled pre-election document next year, accountants and lawyers were surprised at the federal governmentís announcement itís considering replacing the existing eligible capital property rules with a new, depreciable capital cost allowance class.

"For a budget like this, which was really not doing a lot in the tax system, but just kind of shoring up the base, I was a little surprised they would take the effort to start reforming this area, which has been around in the way itís operated for quite some time ó which I guess in some ways is a good sign that theyíre trying to get at issues that have been sort of complicated and are out of the norm," said Len Farber, a senior advisor with the law firm Norton Rose Fulbright in Ottawa.

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