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The impact of corporate scams and securities regulations on investments in Canada are examined. The Ontario Securities Commission for example is criticized for the low number of cases it has heard regarding inappropriate financial reporting or accounting. Corporate scams in Canada include the case against Livent and against YBM Magnex International.

Canadian accounting principles are purposely designed to pass along excessive accounting choice to individual company executives along with any ensuing liability for bad financial reporting. An asset that was built or acquired several years ago may have a book value that is considerably less than its current market value, is an example of weak and incomparable financial reporting.

One always looks at ways to save for the future so that invested funds are useful after retirement, but in many cases many investments turn sour leading to severe financial strain. Useful tips on how one can safeguard savings from investment losses are suggested including how one should educate oneself about a company before making an investment and how one should be on guard against too-good-to-be-true advertisements or advice from vested interests.

Most investors want to EVE know whether a company has cleanly made a 'repeatable' profit in the recent quarter or year. The request sounds simple enough, until we ask what [...]

Canadian corporations can express their creativity in many functions of their business, including finance and accounting. As the economic downturn requires some companies to seek additional financing, we are likely [...]

Accounting lessons from the BCE-Nortel saga Too many analysts have the annoying habit of using a recent year's reported profit figure to predict Future profitability and stock prices. For example, [...]

Accountants come up with creative new ways to line company executives' pockets Ever wonder which new gimmick has replaced the 'take-home pay' executives used to obtain from cashing in stock [...]

How to spot a company's cash flow problem Accountants are taught at an early age to pay less attention to cash and more to their Holy Grail of 'accrual accounting,' [...]

Generally accepted accounting principles are anything but One can't help but feel sympathy for the poor cross-eyed Canadian investor. Public companies in Canada are required by law to prepare their [...]

Canadian investors are being swindled. Where is their protection? You hear about a company, discuss its future with knowledgeable friends, read its annual and quarterly reports, talk to your broker [...]

Accounting alchemy changes expenses--presto change-o!--into assets. Are you feeling confused? Consider the feline curled up on your sofa: she isn't sleeping, she's thinking about developing a better mousetrap. So, the [...]

Shareholders could pay dearly for illusory growth How can you fool most investors most of the time? One method that works particularly well is to create growth in sales and [...]

Beware false profits--they can lead investors astray Are stock prices being inflated by nonexistent or questionable profits? Suppose that you sold a condominium for $210,000 that you had bought for [...]

Ballard's bottom line looks rosy. But appearances--and onetime gains on financial reports--can be deceiving Many New Economy companies are engaged in creative activities, leading to significant advances in telecommunications, information [...]

BioChem Pharma's financial results look great--partly because executives found a way to hide millions in research costs What would you think of evaluating politicians based on the length of their [...]

Everybody on Bay Street is talking about cable these days. If they're not discussing the ongoing battle for control of Groupe Videotron Itee, they're speculating on which of the smaller [...]

Nortel still looks like a great buy--if you haven't done your homework It's easy to understand why Nortel Networks Corp. (TSE: NT) is Bay Streets darling. Over the past year, [...]

The decision to appoint Doug Hyndman to oversee the establishment of Canada's new national securities regulator was criticized due to his lack of interest in enforcement. Companies are fighting against added regulations and Hyndman was perceived by experts in the industry as unfit to protect the investors from market misconduct based on his track record.

Canada is expected to implement the new International Financial Reporting Standards (IFRS) despite the United States' decision to adopt IFRS in 10 to 15 years. The IFRS is believed to have left out accounting concepts that are used by investors. The implementation of the IFRS are expected to result in problems like adjusting values of assets at the time of adoption.

It is believed that Canada needs to fix its financial regulatory framework in order to provide more oversight on accounting procedures that is often left out to auditors. While the U.S. has constantly rebuilt its regulatory framework, Canada has not instituted reforms on its regulations. Canada entered the recession with a strong system but needs to build more substance into its system.

The International Financial Reporting Standards (IFRS) is a nice idea in theory but was implemented in a rush and had poor quality standards from the beginning. The IFRS is in its infancy and behind the accounting standards of the U.S. and Canada.

It is argued that self-regulatory organizations are ineffective when it comes to overseeing securities enforcement since an active government benefits the securities market when it comes to securities enforcement. The same arguments are pointed out for the implementation of the International Financial Reporting Standards in Canada.

The consultation paper of the expert panel on securities regulations is seen as misguided for failing to consider alternatives other than principles-based securities regulations in Canada. A principles-supported-by-framework is expected to work well in Canada. Other views on using principles-based and rules-based securities regulations, are presented.

Canada recently accepted the standards set forth by the International Accounting Standards Board. The International Financial Reporting Standards may be viable for countries with strict regulatory compliance and oversight, however such standards has diminished the power of the auditors to set the rules.

The International Financial Reporting Standards lacks the measures that lay out specific financial reporting requirements and general guidelines supported by clear prohibitions. Those feature are absent in the planned accounting standard but those are the important findings over the collapse of two Alberta banks during 1985.

Accounting fraud could take out a sizable sum from one's retirement fund when computed over a long period of time. The much bigger tax on savings is the collective impact of the smaller losses that do not attract the attention they deserve. Ensuring that investors are not unnecessarily taxed 2 percent of their total investments every year outweighs the benefit of a 2 percent reduction in personal tax rates.

A recent poll showed that only 42% of portfolio managers in Canada are aware that the country is planning to adopt the International Financial Reporting Standards beginning 2011. The shift to the new standards will have significant impacts on investment values and will be the biggest revolution in Canadian financial reporting. The effects of the transition on portfolio managers and investors are analyzed.

Securities enforcement in Canada needs to be improved so as to tackle white collar crimes that influence investors' opinion of the country. There have been high-profile cases wherein investigations have not even been initiated. Details on the responsibilities of the securities commissions and the need for enforcement mandate in a separate agency are discussed.

The Canadian government has frozen the market for non-bank asset-backed commercial paper (ABCP) in August 2007, which means trhat (ABCP) holders will not be able to withdraw their investments. The ABCP crisis and the value of the ABCP are discussed.

Guidelines on how minority shareholders can avoid drawbacks at the time of purchase, during ownership, and when selling their shares are discussed. Contractual protection, sales taxation and share price are also presented. Investment in a private company entails knowing the party you are buying shares from.

The article proposes to make top executives responsible for insider tips that emanate from their companies to help stop insider trading and strengthen the capital markets. Cases of possible insider trading are presented.

Q: Canada is running full tilt towards IFRS adoption. Why should business be concerned? A: Many nations are re-regulating or tightening up requirements as a result of the 2007-2010 world [...]

The 2000 decade has passed and investors got burned by investment returns which were caught between two disastrous market meltdowns, the tech wreck, and liquidity crunch. The lousy 10-year returns were similar to Canada's dismal performance in improving investor protections. How the tech stocks, income trusts and exotic bonds contribute to the useless returns are also discussed.

Correcting for accounting inequities can remove 3 to 21 percent of a company's stock value. Some of the areas that investors need to look out for in valuing their stocks through examining the accounting methods of the companies they own are capitalized costs, off-balance-sheet liabilities, and cookie-jar and understated liabilities.

The amount of CHOICE that executives have when reporting financial results is seen as crucial in evaluating potential accounting manipulation in the stocks that an investor owns. CHOICE stands for capitalized expenses, hidden asset impairments, off-balance-sheet liabilities, inflated revenue, cookie jar liabilities, and executive compensation.

Ponzi schemes such as the one orchestrated by Bernie Madoff is rampant in Canada and affects many corporate pension plans. Some Canadian income trusts are found to be borrowing money or selling more units to new investors to pay cash distributions to old investors, in what is seen as the basic nature of a Ponzi scheme.

Pension plan deficits have grown in Canada, but are not expected to last because asset values are expected to eventually recover. Pension plan deficits happen when estimated liabilities are greater than asset values. Pension plans also happened in the past, but markets eventually recovered.

The interference of world politicans in developing accounting standards is believed to have resulted to untested rules that are inferior to current standards. European lawmakers have recently asked to change International Financial Reporting Standards. Other views on political interference on accounting standards are presented.

Financial statements of companies such as cash flow valuations and income reports tend to be highly erroneous and manipulated due to differences in valuation methods. Investors should not focus on one particular financial statement in making investment decisions. The good and bad practices in securities analysis are discussed.

The handling of the case pertaining to alleged accounting fraud by Nortel Networks Corp. by the Ontario Securities Commission is described. The plans of the United States Securities and Exchange Commission to fine the company upto $100 million are discussed.

Expert advice on investments in income trust and the returns they give is discussed.

Expert advice to companies on investing in environmental-friendly measures is presented.

Expert advice to Canadian investors about understanding the cash flow statements of companies before investing money is presented.

Expert advice to Canadian investors on proper financial reporting is presented and ways to protect their investments are discussed.