Summer 2009 Certiﬁ ed Management Accountants • British ... · The next evolution in accounting Management View 17 | Method for your message Communication is key for accountants

PM 4

0065475

Certifi ed Management Accountants • British Columbia

Summer 2009

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in this issue

C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i ain this

issue | 3

COVER PHOTO: SHUTTERSTOCK

4 | Letter from the Editor

5 | Message from your President & Chair

CMA Spotlight

6 | How do you use social media? Sharing best practices

News and Notes

8 | Digital dashboard | Gadgets and widgets | Inquisitive study

Accounting Scope

9 | Excel conditional formatting Highlighting subtotals for easy reading

10 | What qualifi es as CPLD?

12 | The cash fl ow statement An entrepreneurial perspective

14 | Accounts payable automation The next evolution in accounting

Management View

17 | Method for your message Communication is key for accountants and non-accountants alike

18 | You only crash once A practical approach to IT disaster recovery

20 | Fraud prevention 101 How to keep your organization from getting taken

Strategy Report

22 | Web 2.0 An introduction to social media

24 | The sociable enterprise Why you need an integrated social media marketing strategy today

CMA News 27 | The CMA Strategic Leadership Program: an overview

29 | Diary of a CMA in training

30 | Members on the move

32 | 2009 CMA British ColumbiaMembers Conference

34 | CMA sponsorships and events

35 | Chapter profi le: Victoria

32 34

12

17 18

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SUMMER 2009Editorial and Business Offi ceSuite 1055 Two Bentall Centre, 555 Burrard St., Box 269, Vancouver, BC, V7X 1M8 • Phone: 604-687-5891Toll-free: 1-800-663-9646 • Fax: 604-687-6688Email: [email protected] • Website: www.cmabc.comWe welcome your feedback.Copyright CMA British Columbia 2009.Publications Mail Agreement No: 40065475. Please return undeliverable copies to address above.

executive boardCHAIR Mia Maki, cma, fcmaPAST CHAIR Mehb Jessa, cma, fcmaFIRST VICE CHAIR Donalda MacDonald, cma, fcmaSECOND VICE CHAIR Kelvin Stretch, cma, fcmaTREASURER Stephen Lee, cmaSECRETARY Colin Bennett, cma, fcma

directors at largeMichael Brown, cma, Jeff Champion, cma, Graham Fane, cma, fcma, Clay Harmon, cma, Mark Kennedy, cma, Patricia Kennedy, cma, fcma,Ron Matthews, cma, Jim Olsen, cma,Cecil Stoochnoff , cma, Laura Hartley, cma - yukon

lay representativesDoug Alley, bcom, Anders I. Ourom, llb,Cathy Whitehead McIntyre, ba, mba

executive staffPRESIDENT AND CEO Colin Bennett, cma, fcma VICE PRESIDENT, OPERATIONS Rick Lightheart, cma, fcmaVICE PRESIDENT, PROGRAMS & MARKETING

Vinetta Peek, cma (hon.)

update staffEDITOR – VICE PRESIDENT, PROGRAMS & MARKETING

Vinetta Peek, cma (hon.)ASSOCIATE EDITOR – COMMUNICATIONS SPECIALIST Tiana MahUPDATE EDITORIAL TASK FORCE: David Andru, cma, Don Nilson, cma, fcma, Geoff Bryant, cma candidate, Jeff rey Sparling, cma, Roy Quinones, cma

Canada Wide Media, 4th Floor, 4180 Lougheed Highway,Burnaby, B.C. V5C 6A7 | Phone: 604-299-7311Fax: 604-299-9188

EDITORIAL COORDINATOR Kirsten RodenhizerART DIRECTOR Edwin PabellonADVERTISING SALES Karen RicePRODUCTION MANAGER Suzy WilliamsonSTUDIO MANAGER Kristina BorysPRODUCTION COORDINATOR Julie ReynoldsPRODUCTION SYSTEMS MANAGER Kim McLaneADVERTISING PRODUCTION Allison Griffi oen, Miki May, Chris SherwoodSENIOR IMAGING TECHNICIAN Debbie Lynn CraigELECTRONIC IMAGING Bernhard Holzmann, Laura MichaelsELECTRONIC PRODUCTION Ina Bowerbank

CHAIRMAN & CEO Peter Legge, o.b.c., lld (hon.)PRESIDENT Karen FossEXECUTIVE VICE PRESIDENT Heather Parker, cgaSENIOR VICE PRESIDENT Millie Warren, cgaSENIOR VICE PRESIDENT SALES Bruce WiesnerVICE PRESIDENT PRODUCTION Corinne SmithVICE PRESIDENT MARKETING AND DIGITAL MEDIA

Samantha Legge, mbaVICE PRESIDENT EDITORIAL Kathleen FreimondVICE PRESIDENT FINANCE Farnaz Riahi, ca

A Note to ReadersUpdate is published four times a year by the Certifi ed Management Accountants Society of British Columbia and is mailed to 4,000 CMAs, 1,000 CMA students and industry partners throughout the province. Opinions expressed are not necessarily endorsed by CMA British Columbia.

Certified Management Accountants • British Columbia

4 | editor’snote

his year the Society issued three surveys to our members on society direction and member engagement, continuing education and salary. Th ese surveys provided us with a varied view of

our members’ needs, but the results primarily showed a desire for the following:1. Increased awareness of the designation2. Increased continuing education opportunities, especially

outside the Lower Mainland3. Knowledge of the current CMA pathways and what they

entail4. Increased communication

Two vehicles the Society will use to improve the content of our communication are CMA E-News and Update magazine. Both will be revamped and redesigned this fall to include more content on our programs, profi le CMAs within this province, share best practices, provide continuing education articles, communicate information on seminars and keep our members apprised of Society activities and news. You will also see new social marketing tools such as blogs and podcasts appearing in our communications as we focus on engaging our membership at all levels of their careers and industries. We hope these will provide you with new ways to network with fellow CMAs and share best practices.

Th is fall we will also be launching our continuing education program and website, which is currently in a beta form for testing. Th is site will include news articles, and continuing education seminars and webinars, which will continue to be built in the upcoming year to focus on the CMA core competency model and the needs of our members.

In the January survey to our members regarding continuing education, 84.4 per cent said they felt CPLD activities are valuable for keeping current in their career, and 78.3 per cent agreed CPLD reporting should be a requirement of sustaining their CMA designa-tion. Th e overall consensus was that they supported continuing education as a means of growing their business and careers. We welcome your feedback on this program at each stage of its growth.

Also, I would like to thank all of the members who attended our sold-out 2009 CMA Members Conference in Burnaby this May. Th e post-event survey gave the conference a 98.9 per cent satisfaction rate, with 80 per cent of those members stating they would be registering for next year’s conference, which will be even larger, with more options for speakers and activities. So mark it in your calendars – May 18 and 19 at the Hilton Metrotown. Registration will open later this year and will be announced in Update and CMA E-News.

I hope everyone is having a great summer as we all start preparing for the 2010 Olympics this winter and for being showcased on the world stage.

Vinetta Peek, CMA (Hon.)Vice President, Programs and [email protected]

Have an article, editorial suggestion or feedback you’d like to share with Update? Contact Tiana Mah, Communications Specialist at [email protected].

Want to advertise in the next issue of Update? Contact Karen Rice at 604-205-1711 or [email protected].

Letter from the Editor

C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a

T

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C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i amessage from your

president & chair

Message from your President & Chair

| 5

s we write this, it has been a very busy time of late and we have many exciting things to look forward to in the coming months. We have just wrapped up a very successful and

sold-out third annual CMA British Columbia Members Conference, which had a strong focus on continuous professional learning and development (CPLD) for those attending. We are already planning our fourth conference, to be held May 18-19, 2010. On May 25 our B.C. Board of Directors approved the 2009-2010 Business Plan, and on May 29 we participated in the CMA Canada Council of Chairs/CEO’s meeting, as well as a strategic discussion that included the CMA Canada Board of Directors. Eff ective June 2, 2009, Joy Th omas took over as President and Chief Executive Offi cer of CMA Canada, having successfully led the CMA Alberta society for the past few years.

We have also had some changes here at the B.C. Society. Irwin DeVries, Vice President, Accreditation Programs has announced his resignation. As a result, eff ective June 22, 2009, Vinetta Peek, CMA (Hon.) will be overseeing a combined Programs and Marketing Department as Vice President, Programs and Marketing. Vinetta has been Vice President, Marketing and Communications for the last fi ve and a half years at the Society. Bob Gautama, CMA has also been promoted to the new position of Director, Programs. Bob was previously Manager, Market Development. Shannon Th ompson, Manager, Recruitment has been promoted to Senior Manager, Marketing. Congratulations to Vinetta, Bob and Shannon on their new roles and responsibilities. We’d also like to wish Irwin all the best with his PhD studies.

In B.C. we continue to focus on mobilizing signifi cant time and resources towards continued improvement of the CMA profi le and awareness in all markets, ongoing net growth in our designated membership and increased and improved professional development off erings, opportuni-ties and other services for our members. As usual we have many continuing and planned new activities and initiatives in next year’s approved business plan. A few examples:

• Update magazine: yes, this is the 10th issue, and we plan to continue improving it by taking into account comments received from you, our members. For example, we will be incorporating more information on what the Society is doing to build member pride, increase awareness of the CMA designation and provide more CPLD off erings. We’ll also be including news and information on our members’ activities in each region of the province.

• We will launch a new and improved version of CMA BC E-News this fall.

• We will be launching a public relations campaign to

promote CMA members to the media and to our membership based on the value they are adding to their profession and community.

• In May we launched our new members CPLD plan, which includes webinars and seminars to be held in major centres around B.C. in the upcoming year (registrations online).

• We are setting up a chapters blog to enhance communications and share best practices among our B.C. chapters.

• We are beginning to videotape speakers and presenters at our conferences and seminars and post them on YouTube and the new CPLD site.

• We will be expanding our successful “Four Courses” dinner recruiting events to more locations around the province.

• We will continue to build on our annual Executive Tours to all regions, providing Society updates and recognizing members with CMA service awards.

• We are enhancing our CMA volunteer program to provide more incentives to members to get involved with their Society and their designation.

This is just a sampling of the events, activities and member services planned for the next fi scal year. We hope it gives you some sense of our direction and how we are continuing to forge ahead in a positive and progressive manner for the benefi t of our members and the long-term sustainability of the Society.

Best regards,

Colin Bennett, CMA, FCMAPresident and CEO,

CMA British [email protected]

Mia Maki, CMA, FCMAChair, CMA British Columbia

Board of [email protected]

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6 | C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i aCMAspotl ight

How do you use social media?Sharing best practices

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pdate recently caught up with Juanita Lohmeyer, Candidate in the CMA Program, as well as Stewart Marshall, ACMA, CMA and Richard Wong, CMA

to fi nd out why they’re online and how they use the web’s newest phenomenon – social media.

Update: The use of social media tools like wikis, RSS feeds and social networking sites like LinkedIn, Facebook and Twitter seems to be commonplace. Can you tell me why you’re online?

Lohmeyer: I use these tools primarily to stay connected with others and access relevant informa-tion quickly. As I’m fi nishing up my MBA and CMA and transitioning my career, I’ve been able to use my LinkedIn account to keep track of and manage my contacts, as well as update key individuals on my progress. Facebook has helped me stay connected with fellow classmates.

Marshall: Th ese days I don’t subscribe to cable or own a TV, so I use the Internet for the majority of

my world news. However, that’s the passive side of things – blogs and tools like Twitter are a form of personal and business expression. I use these interactive tools as a way to fi nd communities I can be a part of and participate in.

Wong: I’m online and utilizing social media tools to increase my fi rm’s brand presence. I fi nd it’s a great medium to communicate with others, engage them and hopefully add value with the advice we give.

My firm [First Choice Capital Advisors] uses social media as both an internal and external communication tool. Currently we are writing and contributing online content in order for people to understand some of the value we provide to our clients in our advisor relationships.

We believe using social media can enhance our company branding and profi le, and most importantly, help clients engage better with their customers. My colleagues and I have acquired new contacts from using social media personally and professionally. We have found it very useful, as it gives both parties some insight and background information before meeting in person. It defi nitely allows for easier conversations and quickly established relationships.

Update: Richard makes a good point about how the Internet is a great tool for connecting with people and conducting background research. Other than company websites or blogs, many people are turning to wikis for information. Do any of you have experience with this tool?

Lohmeyer: A wiki is often used to create collaborative websites and power community websites. I managed a team that developed, promoted and established my company’s internal wiki, or knowledge base. Th is was done in order to address the imminent retirement

U

Juanita Lohmeyer, Candidate in the CMA Program – Program Director

Stewart Marshall, ACMA, CMA – Financial Storyteller

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eligibility of a large proportion of the workforce. Th e tacit knowledge these team members possessed needed to be documented so that future generations could benefi t from it, and so that the business could continue to run smoothly.

Normally people don’t enjoy documentation. Th ey often fi nd it an unnecessary evil and leave it as the last thing to be completed, which often results in it not being done. With a wiki, however, the documentation is quick, collaborative and constantly evolving. People actually enjoy participating. Really!

Th rough a process of education and continuous enhancement, over 2,000 team members have contributed to the knowledge base, with over 85,000 edits and over 1,000,000 page views. It became an integral collaboration platform for the exchange of day-to-day business knowledge.

Update: We’ve heard a lot about LinkedIn and how it’s the networking site for professionals. Stewart, you have a large network on LinkedIn – can you share your experiences with this site?

Marshall: When I decided to move to Vancouver I searched on LinkedIn for 10 people I thought would be great to connect with, either based on the number of their connections or the industry they were in. I then contacted them through the site and started to build an email relationship.

I was polite and succinct in my fi rst communica-tions, and I received a number of good responses. Some of these introduced me to others in the city. When I visited Vancouver on vacation I made a point of trying to meet as many of these people as possible, if only for 15 minutes to buy them a coff ee. I continued to use LinkedIn remotely for new connections until I finally landed as a permanent resident. Then I continued to build relationships in person. Some of those fi rst contacts are now good friends, and some led to paid work.

Update: The Internet and social media are constantly evolving. Where do you see the future of social media heading?

Wong: As the younger generation becomes part of management I can see social media becoming a normal part of communications for everyone inside and outside the organization. History has shown people eventually warm up to new ways of communi-cation; for example, faxes, computers, email and Instant Messenger.

Update: How would you like to see the Society and members use social media?

Lohmeyer: To stay connected in our fast-paced and exciting world – especially for announcements about

events and opportunities for members to network and share best practices.

Wong: I’d like to see the Society use social media to upgrade our communication and branding with the public.

Marshall: Short answer – however they want to! For the Vancouver chapter I chair, we’ve recently started a blog at www.cmavancouver.com and a LinkedIn group, as well as a fan page on Facebook. I also know of a number of CMAs who are on Twitter.

I encourage all members who are already using these tools to share what they have learned and reach out to members who may not be online. Th ere are easy ways to get involved: start a discussion on LinkedIn, have a Twitter conversation or comment on a blog post. My hope is that if we all contribute, we can start the process of building a truly valuable CMA community, both on and offl ine.

Update: Any fi nal words of advice for CMAs on using social media?

Lohmeyer: I have four pieces of advice for fellow members: one, present a consistent image or message; two, make it authentic; three, always speak in your own voice; and four, be selective. Not all of the tools out there are right for everyone.

Wong: Th ink of social media as another way of branding your company online, connecting you with employees, customers, prospects and other stakeholders by communicating items of value to your audience. Don’t try to use it solely as a sales tool – this will be recognized and you won’t be getting the benefi ts of social media. Th ink of it as another networking method and you’ll be just fi ne.

Marshall: Try it out. Have no expectations and simply let it develop. By all means be cautious, but don’t let that prevent you from engaging in something you can make work for you. ■

Connect with Stewart Marshall at www.fi nancialsto-ryteller.com, on LinkedIn at www.linkedin.com/in/stewartmarshall or on Twitter @fi nstoryteller. Richard Wong: www.linkedin.com/in/richardwongcfo; Twitter @wongrichard. Juanita Lohmeyer: www.linkedin.com/pub/dir/juanita/lohmeyer.

Richard Wong, CMA – Partner, First Choice Capital Advisors

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8 | news &notes C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a

News& Notes

s you consider marketing yourself for your next gig, be sure you understand the diff erence between process and content.

Content is domain knowledge; people you know or skills you’ve developed. Playing the piano or writing copy about furniture sales. A Rolodex of movers in

a given industry, or your ability to compute stress ratios in your head. Domain knowledge is important, but it’s (often) easily learnable.

Process, on the other hand, refers to emotional intelligence skills you have for managing projects, visualizing success, persuading other people of your point of view, dealing with multiple priorities, etc. Th is stuff is highly valuable and hard to learn. Unfortunately, it’s usually overlooked by headhunters and HR folks, partly because it’s hard to accredit or check off in a database.

Venture capitalists like hiring second- or third-time entrepreneurs for their understanding of process, not their ability to do a spreadsheet. One of the reasons super-talented people become entrepreneurs is they can put their process expertise to work in a world that often undervalues it.

As the world changes ever more quickly, as industries shrink and others grow, process ability is priceless. Figure out which sort of process you’re world-class at and get even better at it. Th en learn the domain – that’s what the Internet is for. ■

D i g i t a l d a s h b o a r d G a d g e t s a n d w i d g e t s

Microsoft Excel keyboard shortcutsTry out the following time-saving shortcuts the next time you’re using Excel:

Keystroke Function

[Alt] [Enter] Insert a new line within a cell

[F2] Enable editing within a cell

[Ctrl] K Insert a hyperlink

[Ctrl] ; (semicolon) Insert the current date

Management Minute podcastsLooking for management tips to help you through these tough times? Robert Half International has launched a new podcast series, The Management Minute. These monthly podcasts feature management and career advice for mid- to senior-level accounting and fi nance professionals. Topics include supervising teams in a tough economy, going global with your accounting and fi nance career and developing soft skills, among others. Visit: rhi.com/podcast.

I n q u i s i t i ve s t u d y

What are you good at?By Seth Godin

Seth Godin is the bestselling author of more than seven books. He writes about marketing, the spread of ideas and managing customers and employees with respect. Visit sethgodin.typepad.com/seths_blog.

A

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scope | 9

Ken Puls, CMA is Controller and Director of IT at Fairwinds Community and Resort in Nanaimo. He is also a Microsoft MVP for Excel and principal of www.excelguru.ca.

ne of the things that always struck me as odd about the subtotals feature in Excel is that the developers only made the words in the subtotals bold, and not the subtotals

themselves. In a long list of data this can make it hard to see which numbers are the subtotals. Fortunately this is very easy to fi x using conditional formatting.

Assume you have a list of data with date, vendor and amount columns. After going to Data→ Subtotals and selecting Sum the Amount for every change in date, you’d end up with a subtotalled list like the image shown in Figure 1.

Let’s assume you’d like to see the subtotals in the amount column displayed in bold with a line on the top and bottom.

Start by highlighting column C.

Excel 2003: Go to Format→ Conditional Formatting and change the drop-down to read “Formula Is.”

Excel 2007: Go to Home→ Conditional Formatting→ New Rule→ Use a formula to determine which cells to format.

Enter this formula: =Right($A1,5)= “Total.”

Click Format.

At this point you’ll see the familiar “Format Cells” dialog box, where you can choose what properties you’d like used to display the data in your cells. On the Font tab select Bold and on the Borders tab click the top and bottom border of the cell. Once done, click OK until you are back at the spreadsheet. Notice your data list is now much more readable! (See Figure 2.)

Th ere are two things you need to understand to construct eff ective conditional formats:

1) When constructing formulas the references are always based on the active cell. In the case of our example, we selected column C, which meant the active cell became C1. Th is is why we looked at $A1 to see if it contained “Total.” In cells B2 and C2 we’d be looking at $A2, and so on down the list. Th e active cell is usually the fi rst cell in your selection, and it can be easily identifi ed, as its background is always clear compared to the other cells in the selection, which have shaded backgrounds.

2) All formulas are evaluated to see if they are true or false. So in our example, we checked to see if the right fi ve characters equalled “Total.” If so, the conditional format is applied, and if not, it isn’t. As you can see from Figure 2, this test would have returned false on A8, but true on A9.

Conditional formatting is an incredibly useful tool that is not restricted to working with subtotals and can be applied to anything that lives within the spreadsheet grid, including pivot tables. A few examples of where I use conditional formats are: highlighting the largest or smallest numbers in a list, highlighting invalid data that has been entered into a worksheet, colour-banding alternate rows to make large spreadsheets easier to read and highlighting rows in large data sets.

Th is tool has existed in Excel for many versions, but went through a major upgrade in 2007. Until then you were limited to using only three conditional formats in any cell, but with the release of Excel 2007 this limitation was removed. You can now use as many formats as you wish, the only limit being the memory in your computer. Other additions to Excel 2007’s conditional formatting toolset include data bars, icon sets, heat maps, overlapping formats and the ability to stop any further formats from being applied once one is triggered.

Used properly, conditional formats are a truly powerful feature in Excel, and well worth exploring if you haven’t done so already. ■

Excel conditional formatting

OHighlighting subtotals for easy readingBy Ken Puls, CMA

Figure 1: Subtotalled list without bolding.

Figure 2: Subtotalled list with bolded amounts.

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10 | accountingscope C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a

Jeffrey Sparling, CMA is the Manager of the Offi ce of Strategic and Per formance Manage-ment with Bouchard and Company, Chartered Accountants. He is a member of the Update Editorial Task Force and serves on the CMA Continuous Profes-sional Learning and Development Commit-tee and CMA Public Licensing Committee. He is also a moderator for the CMA Strategic Leadership Program.

ollowing are the qualifying professional development activities as posted on the CMA BC website under “I am a CMA” in the professional development section. Next issue

we’ll present a framework and options for developing and pursuing a professional development program that encompasses the CMA Competency Map. Th e activities listed below are only part of the equation. Knowing what your professional strengths and weaknesses are, and what will be required of you professionally in the future, is essential to formulating the development program to best satisfy your future growth and competency.

Qualifying professional development activitiesAll continuous professional learning and develop-ment (CPLD) activities must serve to increase professional competency in the broad area defi ned as CMA territory. CMA British Columbia encourages its members to undertake a broad range of CPLD activi-ties to enhance their cross-functional skills.

CPLD activities are broken down into six catego-ries for the purposes of tracking and reporting. Th ese activities are tracked on an input basis. Th is means each CPLD activity will have a unit of measure (learning credits) associated with it. In most cases, a learning credit is equivalent to one hour, except where indicated below.

1. Formal learning and development activitiesTh e CPLD requirement for this category is satisfi ed through formal course study leading to a new degree, diploma or recognized professional designation, or coursework resulting in a fi nal grade.Examples: Courses related to professional activi-ties with structured evaluations, such as university courses or programs, MBA degrees and distance or part-time university credit courses. In the case of distance education courses, the equivalent hours that would be required for the course if it were taught in the classroom are used.Measure: One (1) hour of classroom time = one (1) learning credit.Yearly maximum: 80 credits.

2. Informal learning and development activities related to professional competencyTh e CPLD requirement for this category is achieved through a self-directed program of informal studies that serve to maintain and/or enhance the member’s business and professional competencies.

Examples: Certain continuing education courses, non-credit courses, training courses off ered at work, online training, conferences, seminars.Measure: One (1) hour = one (1) learning credit.Yearly maximum: 80 credits.

3. Reading or research related to professional competencyTh is category involves business reading and research conducted at work and at home.Examples: Reading business journals and books, non-credit courses, web-based reading and research. Measure: One (1) hour = one (1) learning credit.Yearly maximum: 30 learning credits (eff ective for CPLD undertaken from July 1, 2009 onward).

4. Volunteer and community leadership contrib-uting to professional competencyTh is category requires active involvement in the business and volunteer community in roles that highlight, enhance or maintain a member’s professional and business competency.Examples: Mentoring activities, serving on volunteer boards or committees.Measure: One (1) hour = 1.5 learning credits.Yearly maximum: 25 credits.

5. Formal teaching and/or writing contributing to professional competencyTh is involves teaching in a formal academic environ-ment or in a defi ned teaching role within business and/or writing for publications (including approved web-based publications).

What qualifi es as CPLD?By Jeffrey Sparling, CMA

F

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Examples: Moderating or teaching CMA Canada-related courses, moderating or teaching other programs of an equivalent level of professionalism, writing articles or books of a professional nature, delivering presentations.Measure:

• One (1) hour moderating/teaching time = two (2) learning credits

• One (1) published article = 15 learning credits• One (1) extensive paper = 20 learning credits• One (1) published book = 80 learning credits

(exempt from maximum credit restriction)• One (1) hour of presentation time = two (2)

learning creditsYearly maximum: 20 credits, except as otherwise stated.

6. Other professional learning and development activities as may be deemed appropriate by CMA British Columbia for developing and maintaining member competency.

Next issue we’ll discuss a framework and options for members designing a professional development program that encompasses the CMA Competency Map. To learn more about upcoming CPLD opportunities, refer to the latest issue of CMA E-News, or visit the new CMA BC CPLD website: www.cmabc-pd.com. ■

Upcoming CPLD opportunitiesCMA Executive Development Series (fall 2009)Victoria – Sept. 16, Oct. 14, Nov. 4, Dec. 2Vancouver – Sept. 17, Oct. 15, Nov. 5, Dec. 3The CMA Executive Development Series is a four-part series facilitated by author and professional speaker Shane Gibson, focusing on key trends and challenges business leaders face today.Part 1: Implementing Social Media Into Your Business StrategyPart 2: Executive Presentation SkillsPart 3: Partnering and Stakeholder Engagement StrategiesPart 4: Leadership 2.0

Free Microsoft Dynamics eLearning coursesCMA Canada has teamed up with Microsoft and Qixas Academy, a leading provider of Microsoft Dynamics education, to offer all CMAs and CMA candidates free Microsoft Dynamics eLearning courses. Visit CMA MemberPerks at cma-canada.venngo.com for a list of available courses.

Fourth annual CMA British Columbia Members ConferenceMay 18-19, 2010 – Hilton Metrotown Hotel, Burnaby, B.C. This two-day confer-ence qualifi es for 15 CPLD credits.

IFRS seminars (dates and locations vary)CMA British Columbia members qualify for a 10 per cent discount on IFRS seminars booked through www.iaseminars.com/en/cmabc.html.

ECornell – leadership and business managementCMA Canada members can now earn cer tifi cates from Cornell University in the fi elds of leadership and business management. For more details visit www.cma-canada.org and click the professional development link. CMA members receive a 36 per cent discount on eCornell’s courses and business certifi cates.

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n the winter 2009 issue, we took a new look at the traditional accounts receivable aging schedule. In this issue, we look at a new approach to the cash fl ow statement, particularly geared to

entrepreneurial business.For us “old-timers,” the cash fl ow statement has had

a fairly active history in the handbook. Over the years it has been known euphemistically as the “Where Got Where Gone,” and properly as the Statement of Sources and Uses, the Statement of Sources and Applications, the Statement of Changes in Financial Position and, lately, the Statement of Cash Flows. Previously it focused on net working capital, but it has evolved to instead focus on cash or cash equivalents. Th e categorical concept of operating, investing and fi nancing subheadings was introduced in 1987.

While we produce handbook-style cash flow statements in the offi cial fi nancial statement package, we produce a modifi ed version for separate reporting to our entrepreneurial clients. Th is includes a fourth subcategory, which we call “shareholder activities.” At fi rst, this merely shuffl es the reporting of dividend payments and shareholder loan activity from other places on the statement to the shareholder section.

But, more importantly, we adjust the operating and shareholder sections by adding back owner compen-sation. Th us, the operating earnings are “pre-owner remuneration,” and the shareholder section eff ectively includes all funds withdrawn, not just those off the balance sheet. We also present this information on a rolling fi ve-year comparative, add up the fi ve-year totals and express all of this in percentage as well as dollar terms. Each client’s historical information is kept in an Excel data fi le, and this is pasted annually to a template fi le in Excel.

Here’s how it looks:Working down the categories in order, we can make several observations and inferences. (See the table on the opposite page.) First, we look at the dollar levels:

• Working capital (essentially the interplay of receivables, inventory and trade payables) has required significant funding year after year, totalling approximately $1 million over five years, or $200,000 per year on average.

• Cash infl ow from operations hit an all-time high in 2009, and the company is averaging almost $600,000 per annum.

The cash fl ow statement

IAn entrepreneurial perspective

By Don Nilson, CMA, FCMA

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• Owner salaries, dividends and shareholder loans have withdrawn $1.6 million over the fi ve years (approximately $300,000 per year), and 2009 was the highest.

• Th e investment section shows the company has invested in plant and equipment to the tune of approximately $600,000 over the fi ve years.

Second, we can look at the fi ve-year total percentage relationships between the various line items, expressed as a percentage of annual cash infl ow:

• Over the fi ve years, operating activities have provided almost all of the cash infl ow (94 per cent), except for a bit of incoming fi nancing for plant and equipment (mostly in 2008).

• Of that cash infl ow, one-third has been required to fi nance working capital, 53 per cent has been withdrawn by owners and 19 per cent has been invested in plant and equipment.

Each year’s percentages can be studied on their own as well. Th e last line at the bottom – Percentage of Operations Cash Flow – refl ects owner withdrawals purely as a percentage of operating cash infl ow, not total cash infl ow, which can be skewed in years where there has been signifi cant incoming fi nancing for plant and equipment (e.g. 2008 – 35 per cent versus 52 per cent).

We use this report live, along with a traditional financial ratios worksheet, when we are reviewing year-end results with our clients. It’s always nice to see a business do well; however, most clients would rather see more of that success go into their own pockets – allowing them to pursue life and happiness – than have it stay in the business to fi nance working capital and

equipment. Th e historical perspective of both these Excel sheets provides some context for making strategic decisions about how much can be withdrawn without impairing the business. We can also add context to that decision by drawing on the experience we have gained going through these Excel sheets with hundreds of other entrepreneur clients over the years.

Th is particular business is a wholesaler that carries $1 million each in inventory and receivables, as well as a signifi cant investment in capital equipment. As a result, the operating activities require fi nancing, and lenders are loath to carry the full weight, so some retained capital is required from the owners. Th us, we see the shareholders have only been able to withdraw approximately half of the operating cash fl ow over the fi ve years. Th e rest has been needed to sustain a growing, capital-intensive business. (On the other hand, a service business will have less capital need, and thus we see the owners can withdraw 80-100 per cent of the annual operating cash infl ow.) For our wholesaler, we also keep an eye on the sales growth statistics and on the ratio of working capital to sales. Th is business has been growing at close to 20 per cent per annum for the last fi ve years, and the working-capital-to-sales ratio has ranged from 17-21 per cent. Going forward, this helps us estimate how much capital will be needed next year if sales grow again by 20 per cent; for example, another $1 million in sales will require new financing of approximately $200,000. Where is it going to come from? Banks? Trade creditors? Retained earnings?

Th ese analyses and insights help entrepreneurs manage proactively, rather than making a panic call to their banker when bills are due and the credit line has hit its max. ■

Don Nilson, CMA, FCMA is the Principal at Nilson & Company. He is also a member of the Update Editorial Task Force.

SOURCES AND (USES) OF CASH 2005 2006 2007 2008 2009 Five-Year Total

LESS (MORE) WORKING CAPITAL (182,984) (109,930) (308,866) (271,883) (157,623) (1,031,286)

% of total cash infl ow -41.4% -21.7% -49.7% -30.7% -21.2% -33.7%

FROM OPERATIONS (*) 432,255 486,806 620,963 602,101 743,802 2,885,927

97.8% 96.0% 100.0% 68.0% 100.0% 94.3%

BORROWING (REPAYMENT) 9,692 6,241 (92,769) 282,787 (33,010) 172,941

2.2% 1.2% -14.9% 32.0% -4.4% 5.7%

TO SHAREHOLDERS (*) (270,623) (311,655) (269,520) (311,197) (451,680) (1,614,675)

-61.2% -61.4% -43.4% -35.2% -60.7% -52.8%

FROM (TO) INVESTMENTS (48,776) 14,190 (78,510) (373,210) (97,719) (584,025)

-11.0% 2.8% -12.6% -42.2% -13.1% -19.1%

INCREASE (DECREASE) IN CASH (60,436) 85,652 (128,702) (71,402) 3,770 (171,118)

13.7% -16.9% 20.7% 8.1% -0.5% 5.6%

% OF OPERATIONS CASH FLOW -63% -64% -43% -52% -61% -56%

*PRE-OWNER REMUNERATION

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n your organization, has a vendor invoice ever sat under the paper pile on someone’s desk? Have you ever paid a bill twice because a duplicate invoice slipped through? Do you store your historical

accounts payable fi les in boxes off -site or in some faraway room, resulting in a groan when a request for those documents comes through? Does your company make copies of invoices and send them to multiple locations for approvals at various levels of management?

If you answered yes to one or more of these questions, your organization suff ers from “accounts payable pains.”

Not to worry, there is a solution. Automating your accounts payable process and workfl ow can eliminate these pains and save your organization signifi cant resources at the same time.

Analyzing the cost and effi ciency of the payable process rarely gets the attention it deserves in small to mid-size organizations. And rarely is there something truly evolutionary in the field of accounting that actually leads to measurable savings, is easy to do and relates to accounts payable. But the automation of accounts payable is precisely that: new, effi cient, capable of saving signifi cant resources – fi nancial and non-fi nancial – and, as an added bonus, green.

Although this technological process has been available for some time to Fortune 500 companies, in recent years it has become available to small and mid-size companies in simple and affordable platforms. Thanks to the Internet and web-based outsourcing, any company can take advantage of workfl ow process automation.

What is accounts payable automation?Accounts payable automation (APA) is the fi nal frontier in process automation. Most companies still code, approve and fi le their vendor invoices by hand. APA changes the manual workfl ow into a paperless, digital process.

In other words, invoices are centrally scanned into a digital format via optical character recogni-tion (OCR) software, and routed for coding and approval via the Internet and email. This process uses a web-based software application, “SaaS,” as well as an off-site, secure document archival system. The OCR component eliminates the need for manual data entry, since digitally read, coded and approved invoices are then imported into the accounting system.

Measurable benefi ts of automation• Labour cost-savings – OCR capture and integra-

tion into enterprise resource planning (ERP) systems such as SAP or accounting software, such as QuickBooks, can signifi cantly reduce the number of full-time equivalent (FTE) accounts payable clerks needed. Th e alternative is to increase payables volume without adding more staff .

• Increased utilization of cash discounts – most manual processes are too slow to maximize these opportunities.

• Improved payment accuracy – APA completely eliminates duplicate vendor payments.

• Improved document retrieval and storage – the best APA systems are database archival systems. Finding documents is as easy as opening a web page and searching – extremely fast and simple.

• Reduced operating costs – APA can result in the elimination of physical paper storage, as

Accounts payable automation

IThe next evolution in accountingBy Catherine Dahl, CMA

COMPANY ABC PER MONTH ($) ANNUAL ($)

Labour costs 3,000 36,000

Missed discounts 250 2,997

Reduced duplicates 375 4,500

Document storage costs 250 3,000

TOTAL estimated savings 4,750 56,997

Sample costs of Bean Services’ APA offering

User fees 300 3,600

Capture fees 1000/inv/mth 1,000 12,000

TOTAL 1,300 15,600

Net savings 3,450 41,397

Table 1: Savings with an APA system.

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Catherine Dahl, CMA is a Client Development Manager with Bean Services Inc. (www.beanservices.com) – an award-winning developer of web-based invoice software and a leading APA SaaS provider based in Vancouver, B.C.

Canada Revenue Agency currently accepts PDF copies for tax purposes. APA also reduces invoice routing (i.e. mail and courier) costs and the time staff spend making multiple copies of vendor invoices.

Additional intangible benefi ts of APA• Faster invoice dispute resolution.• Easier rerouting or repackaging of accounts

payable backup documents to customers.• Reduced business disruption after a disaster, as

documents are off -site.• Easier audits.• Better regulatory compliance, as delivering vendor

invoices to electronic repositories guarantees important data is recorded, properly validated and easily accessible to the audit process.

Benefi ts of using SaaS applications over proprietary softwareWhy use a web-based option (SaaS) over purchasing or designing an in-house software system? Generally, cost is the reason, but there are many other ways SaaS makes the APA process accessible to smaller companies.

• Lower cost of ownership – this cost is borne by the outsourcing company.

• No installation or maintenance of hardware or software.

• Enhanced data security – most SaaS vendors have 24-7 physically secured and electronically secure data storage at a level most small to mid-size companies would fi nd cost prohibitive.

• Aff ordable bandwidth.• Disaster recovery/business continuity, as data is

hosted and backed up off -site.• Ease of upgrades, as this rests with the APA

vendor.• Continual access to new program features.• Reliable service levels – SaaS providers typically

monitor their systems 24-7 to proactively identify and fi x potential problems.

How quickly it adds up: a case studyLet’s assume ABC Company has $1,500,000 in annual vendor payments, and two accounts payable clerks who process 1,000 invoices a month. Th e average clerk can usually process as many as 600 to 900 invoices per month with a manual data entry system (source: By the Numbers: Accounting, OSBC, 2005). Th e all-in salary of one FTE is $36,000 annually, or $3,000 a month. ABC Company has access to vendor discounts of one per cent to two per cent on about

APA FEATURES BEANBILLS TIMBERSCAN BASWARE CUSTOM-DEVELOPED

Cost

Low upfront risk, multiple options, hosted – low IT

staff requirements

High upfront risk, high IT staff

requirements

High cost including

time & effort

High cost including serious

staff time & effort; high-risk

UsabilityEasy to use; easy

training

Diffi cult to use; diffi cult training

– Timberline entrenched

usability

Easy to use; easy training

May vary based on development

Web-Based Accessibility

Yes No Yes Possibly

Data Capture Yes, optional

service

None, would need to purchase and implement OCR

Yes, additional software

cost

None, would need to purchase and implement

OCR

Customizable

Easy through application

programming interface

Very limited, also limited

by Timberline functions

Unknown Yes

Purchase Orders Yes No Yes Yes

Purchase Order Matching Workfl ow

Yes No Yes Potentially

Integration Yes Only Timberline Yes Yes

Table 2: APA providers.


54 per cent of those invoices, but only captures 63 per cent of those available, a typical situation (source: IOMA’s benchmarking study, 2005), which adds up to $299,700 in total vendor payments that are available for missed early payment discounts.

ABC Company is typical in that it loses 0.03 per cent of total payables through unrecovered duplicate payments (source: IOMA’s benchmarking study, 2005); also in that the company pays $250 per month for long-term off -site storage.

Table 1 on page 14 outlines how much an APA system could save ABC Company. As illustrated by this example, a good APA system will pay for itself many times over. Keep in mind each company has its own unique set of processes and problems.

When considering this type of automation, a detailed analysis is recommended and can be furnished by your APA provider. In addition to easily measured savings, a company should consider the soft costs saved by a reduction in frustration and “pains” that exist outside the accounts payable department.

Who is the leader?Th ere are several APA options out there today to choose from. Table 2 on page 15 assesses some of the more popular choices.

Three keys to successful adoption of APAWhen considering automating the payables process, there are three critical keys to success:

1. Plan ahead – analyze your process, cost out the ineffi ciency of your current system, make an implementation plan and know your workfl ow.

2. Assess your organization’s ability to adapt to change. Going paperless is not as simple as it seems, as we are so used to paper.

3. Have a centralized routing system for all vendor invoices. To gain the effi ciencies of an APA system, paper has to be discarded after it is scanned – or, mandate electronic vendor invoices. ■

Although this technological process has been available for some time to Fortune 500 companies, in recent years it has become available to small and mid-size companies in simple and affordable platforms. Thanks to the Internet and web-based outsourcing, any company can take advantage of workfl ow process automation.


C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a | 17managementview

Method for your messageCommunication is key for accountants and non-accountants alikeBy Roy Quinones, CMA

Management

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Roy Quinones, CMA is a Credit Risk Analyst with Powerex and a member of the Update Editorial Task Force.

o my peers, accounting is a foreign language understood only by those who speak it. Yet we can’t understate its importance in the overall business framework. So how do

we communicate accounting and accounting-related information to non-accountants?

The first step is improving our overall skill in communication. Looking back to my university studies, my business communications course stands out and continues to be one of my better references. While communication is still a work in progress, I try to adhere to these guidelines:

PurposeMake sure it’s clearly defi ned, otherwise the message you’re trying to convey may be passed off as unimportant, or be missed altogether. For example, I once received an email with no message, only the subject “As Requested.” Th e attached Excel fi le had a graph, but no other information. In the end, I contacted the sender to clarify what the data was.

ToneHow a message is conveyed is just as important as the message itself. When attempting to be persuasive or turning down a suggestion, try to be polite and positive. Avoid using sarcasm or negative words such as “not,” “unable” and “wrong.” Instead of saying, “Th is doesn’t work because…,” try saying, “I understand what you want to accomplish, but this is what we are allowed to do…” – it might work better than a message that sounds like a blunt “no.”

ALSO, AVOID USING CAPITAL LETTERS, AS THE READER MIGHT FEEL LIKE YOU’RE SHOUTING.

Frame of referenceTwo people can look at the same information and

interpret or use it diff erently. Try to understand the perspective of your audience. Ask yourself, “Why do they need this information?” or “How can I make them understand where I’m coming from?” Keeping those questions in mind can help make your message clearer. I previously served as an intermediary between fi nance and operations. Transmitting information both ways gave me a better sense of what both groups wanted – their inquiries became easier to address as I started to understand what each party wanted.

Environmental factorsSometimes intangibles can aff ect the clarity of your message. For example, sending a message about a vacation request to your manager during year-end processes will most likely be received unfavourably. A better approach would be to determine the best time to relay a message or request. For example, co-workers may be less receptive to information requests at the end of the work day, while others may be more accepting. Personally, I prefer receiving information requests at the beginning of the day, as I like to use the end of the day to review work and have quiet time to complete my tasks. ■

T

How a message is conveyed is just as important as the message itself. When attempting to be persuasive or turning down a suggestion, try to be polite and positive. Avoid using sarcasm or negative words such as “not,” “unable” and “wrong.”

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hat you are about to read is, unfortu-nately, a true story.

It’s 7 a.m., and the CFO of a $15-million electronics distributor

is frantically calling my home phone. “Our business was broken into, and the server containing all of our data and applications was stolen. Can you help us?”

My stomach lurches. I’m almost afraid to ask, “Do you have backups?”

Th ere’s a long silence. “Maybe.”Of companies experiencing a major loss of

computer records, 43 per cent never recover enough to reopen their doors. Another 51 per cent close down within two years of the loss. A mere six per cent survive over the long term (see Management Information Systems for the Information Age by Stephen Haag, Maeve Cummings and Donald J. McCubbrey). So the prospects for our client are grim.

Nevertheless, we dash to the client’s site, and discover only three backup tapes. Th e old server was taken along with the previous night’s tape, and no one knows what backup software was used. In fact, the original installation media for all the software was either taken at the time of the break-in or has been lost over the years.

So let’s understand what is gone. All of the company’s data, including accounting, HR, sales, marketing, administration and intellectual property. In other words, everything our client needs to stay in business.

Our only hope lies in reading those three tapes. We dig through storage looking for the original vendor invoices to fi nd out what was originally installed on the server. By 1 p.m. the next day, we have enough information to create a plan. We’ll try to fi nd a new server with a matching tape on the off chance we can restore the tapes.

Our client is amazingly lucky. We fi nd a compat-ible used tape drive, persuade the backup software manufacturer to let us download a long-obsolete edition, obtain an old version of Novell for the newly provisioned server and piece together the information on the tapes, parts of which have been corrupted. After an entire week of working around the clock, we recover over 95 per cent of the data.

But the cost is high – $30,000 in consulting fees, and a week of lost sales and productivity. Too bad they didn’t have a business continuity plan.

Business continuity planningA business continuity plan is a blueprint for the way

You only crash onceA practical approach to IT disaster recoveryBy Arian Soheili, CMA

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a business plans to respond to and survive everything from a local equipment failure to a global disaster. As business professionals, we understand the necessity of such a plan. However, very few of us have one in place – primarily because the topic is overwhelming for those traditionally tasked with creating them; namely accountants.

So how do we prevent a disastrous data loss? We could focus on a data-oriented business continuity plan, an indispensable component of business planning regardless of your organization’s size. However, small to mid-size businesses generally lack the in-house IT resources to achieve the demanding planning, technical and process requirements. As a result, many either neglect to implement a data-oriented business continuity plan, or else they approach data backup and recovery in a sporadic, rudimentary fashion.

Traditionally, the only solution for the small to mid-size business has been a tape backup. A tape solution is costly to acquire and manage and requires constant monitoring, servicing and testing to achieve acceptable reliability. Also, tape is highly sensitive to environmental factors such as heat, humidity and magnetic interference, leading to high failure rates. Analysts estimate that anywhere from 42 to 71 per cent of tape restores fail (see the article Recovery Will Move to Disk-Based, Manager of Managers Approach by 2011 by Dave Russell of Gartner Group at www.gartner.com). Moreover, tape cartridges must be replaced every six to 12 months, a costly and cumber-some process.

Advances in network attached storage (NAS)As technology has progressed, and data volumes have expanded from megabytes to terabytes, tape technology has lost ground to new technologies such as network attached storage (NAS) and remote storage facilities. Both are based on hard-disk technology that has become very inexpensive in the past few years.

A NAS device is a self-contained computer connected to a local area network (LAN). In general, NAS devices supply fi le-based data storage services to other devices, such as desktops and servers, on a network. Th ey are proving to be more reliable, cost-eff ective and easier to manage and maintain than tape solutions. Th e trend is toward using NAS devices with remote storage capacity for additional security.

Better than tapeTape-based backups are still an alternative that should be considered. However, the NAS device is making tape a less competitive solution. Th is is because NAS device backups with off -site daily storage are more reliable. Th ey have lower maintenance and total ownership costs. By eliminating physical tape, they lower the risk and cost of human intervention in the process of moving the backup tape to and from a

remote off -site storage location. Th ey’re also faster, off ering near real-time backups. Moreover, since most NAS devices are servers in their own right, they can be used to virtualize a backup copy of the server image – impossible with tape. In short, this technology permits a restored copy of your entire server to run in a virtual environment on the backup device. More information on virtualization can be found in the winter 2008 issue of Update magazine in the article Th e Sun Sets on Server Sprawl.

Tips for implementing NASSince NAS technology is relatively new, your consul-tant may not be familiar with its intricacies. When evaluating solutions, look for a NAS device that:

• Allows for near real-time backups, performing them as frequently as every 15 minutes.

• Maintains incremental images for years.• Backs up everything, including the operating

system, applications and all data.• Offers automated daily off-site storage at an

aff ordable cost.• Can be monitored remotely and managed by

a specialist, eliminating the cost and time of on-site management.

• Eliminates server downtime for repair or replacement by using virtual server applications to activate a temporary backup image.

• Encrypts access to both the NAS and the remote storage facility with an ultra-secure password.

• Bundles the costs of frequent on-site backups, an on-site virtual server, remote storage, disaster recovery and 24-7 management.

Back to our client with the stolen server. Yes, the story had a relatively happy ending, with near-total data recovery and a hefty consulting fee for my fi rm. But this isn’t how good consultants want to make a living. We would much rather come in before a disaster strikes and develop a workable business continuity plan to protect our clients. Ideally, that would include the latest disaster-recovery technology, like NAS and remote storage – much more eff ective than legacy tape systems at an equivalent price, and so reliable I won’t need to fear my phone ringing at the crack of dawn. ■

C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a | 19

Arian Soheili, CMA is Managing Director of Cantatus Systems Group, Inc., an integrated enterprise solution provider in Surrey, B.C. (www.cantatus.com).

Management

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managementview

BASIC TAPE BACKUP

NAS WITH OFF-SITE STORAGE

Reliability Lower Higher

Maintenance cost Higher Lower

Cost of ownership Higher Lower

Overall risk Higher Lower

Near real-time backups No Yes

Automated daily off-site No Yes

Virtual server appliance No Yes

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20 | C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a

s your most trusted employee robbing you blind? Th e Association of Certifi ed Fraud Examiners’ 2008 Report to the Nation (www.acfe.com/resources/publications.asp?copy=rttn) estimates

you lost at least seven per cent of your total revenue to fraud, assuming your business has good, working internal controls – and potentially much more if it doesn’t.

Every year thousands of companies go out of business or file for bankruptcy protection. It’s impossible to know how many of these failures were the result of losses sustained from theft or corruption of employees, management, contractors or suppliers. While the fraud losses sustained by businesses are not often in the news, those sustained by not-for-profi ts often are. Recently in the Lower Mainland, volunteers working for organizations like junior soccer leagues and the Canadian Legion stole hundreds of thousands of dollars and left their organizations virtually penniless. What is going on? Are these simply aberrations or is there a pattern?

Most of the fraud that takes place in small businesses and not-for-profi ts has its roots in a lack of internal controls, with one or more trusted employees or volunteers having too much responsibility without adequate oversight. Often these are medium-size

organizations that have grown to a point where the owner/manager no longer does all of the accounting. Usually the person who commits fraud is the one person everyone relies on, who takes on the lion’s share of the work – your most trusted employee!

Occupational fraud research has shown white-collar criminals need to be able to justify their crimes in their own minds, so part of the prevention involves removing potential justifi cations. You can do this with fair pay, good working conditions and reason-able benefi ts. In addition, research shows that while roughly 20 per cent of people are completely honest, 60 per cent can be tempted, and the remaining 20 per cent are utterly dishonest and will steal regardless of what you do. Hopefully you have managed to avoid hiring the criminal 20 per cent, so you need to ensure you are not tempting your employees to steal. In my experience, many fraudsters get their start by making a “mistake” that isn’t caught.

Top 10 things you can do to prevent fraud in your business or not-for-profi t:

10 Protect your assets by segregating work, if possible. One person should not control

Fraud prevention 101How to keep your organization from getting takenBy Patricia McDowell, CMA

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an entire process or asset. If possible, separate: bank deposits from bank reconciliations and general ledger updates; purchasing from accounting and receiving; authority to set up new vendors from handling of signed cheques. If this is not possible due to the size of your organization, you need to pay particular attention to the next suggestion.

9 Do everything you can to make your employees believe you are checking their work. To

protect your bank accounts, have bank statements sent to you directly, at home if necessary. Open them and give them a quick review before you pass them to the person responsible for reconciliations. Ideally, you should always ask your reconciler a few questions about the contents to indicate you are checking.

8 Never hire anyone without checking all of his or her educational and prior employment

claims. You would be surprised by how many employees who commit fraud started by inventing or infl ating their qualifi cations. When speaking to references, especially prior employers, make sure you ask for candid feedback. Ask whether, given the opportunity, they would rehire that person. A yes or a no is suffi cient for your purposes; you don’t need a lot of details.

7 Ensure all payments made to employees for business expenses are properly supported

and approved. Who authorizes the manager’s expenses? You may want to consider setting some fi rm guidelines for business travel and entertain-ment expenses.

6 Make sure you are paying competitive wages and benefi ts to avoid giving your employees

a motive to “supplement” their salaries without your knowledge. Have open discussions with staff if you are unable to give pay raises on schedule, so they don’t feel personally aggrieved.

5 Set an ethical tone at the top. Make sure your employees do not see you taking ethical

shortcuts. Your employees need to feel you are committed to ethical dealings with staff, clients and suppliers. Some companies send form letters on an annual basis to all suppliers to tell them staff are not allowed to accept gifts of any kind. Give suppliers your contact number to call if they have any concerns.

4 If possible, do not provide corporate credit cards to your staff. Ideally, have employees use

their personal credit cards and ensure reimburse-ments are made promptly. Without exception, every company I have dealt with that has used corporate

credit cards has had employee fraud as a direct result, often with signifi cant losses. I once heard from a sales director that a certain company had to provide corporate credit cards because several of its best salespeople couldn’t qualify for their own cards. I was investigating a signifi cant fraud committed by one of those individuals at the time. Needless to say, you don’t want people who can’t manage their own fi nances to have direct access to your money through a credit card account.

3 If you have an external auditor, you need to ensure they have unrestricted access to all

accounting personnel, documents and records. In one of my cases, the external auditor (one of the Big Four) was only allowed to talk to the accounting manager, not any of the supervisors or staff , and could only use information she provided (in some cases specially prepared by her) for the audit. Th e auditor missed years of fraud indicators (the so-called red fl ags) that cost the company millions of dollars.

2 Perform a risk review to identify your company’s exposure to fraud, and design cost-effective

controls to either eliminate or mitigate the risks. Review periodically to ensure the controls are: a) still working and b) still eff ective. In addition, look closely at the people, usually senior employees or managers, who are able to circumvent or ignore internal controls.

1 Arrange for surprise internal audits at least once per year. Companies without internal

audit departments are much more vulnerable, but can mitigate this risk by hiring an outside specialist to perform annual audits. Just knowing someone could appear at any time to review the operation is a huge deterrent to employees who might otherwise be tempted.

One thing I haven’t mentioned, but highly recommend, is the establishment of an anonymous whistle-blowing hotline operated by a third party.

Occupational fraud is a complicated subject with nearly as many variations as there are people who steal. It’s also very diffi cult for organizations to deal with. For instance, when a bank is held up and the robber gets away with $100,000, management immediately knows the extent of the loss. When a cashier embezzles $100,000 from cash deposits over months, management may not know there were losses until much later, if at all, and depending on the circumstances, they may never know exactly how much was stolen. Th e fact that the person stealing is often your most trusted employee also gives the whole situation an emotional overlay that can be very complex and diffi cult to face. ■

Management

View

managementview

Patricia (Pat) McDowell, CMA is an independent forensic auditor and accountant working in association with theLions Gate Investigations Group, which specializes in identifying, investi-gating and quantifying losses due to occupa-tional fraud. She is also a Certifi ed Internal Auditor (CIA) and a Certifi ed Fraud Examiner (CFE), and is currently Vice President of the Vancouver chapter of the Association of Cer-tifi ed Fraud Examiners.

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22 | strategyrepor t C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a

ver the past several years the Internet has evolved from a network with very few contributors – libraries, academic institutions and a few businesses – to an

environment where anyone can contribute. Th is is the layperson’s defi nition of “Web 2.0” – a term that often pops up without any indication of what it means.

Web 2.0 gradually came to be called “social media,” with the creative “SocMed” abbreviation appearing with increasing frequency. Social media is about sharing ideas and gleaning information from sources of one’s own choosing. Social media is lightning-quick, and through sites such as Twitter, Google Reader, Facebook, LinkedIn and dozens of others, there is an immense amount of information at your fi ngertips.

Social media basics Th e value proposition for avid Internet users is the dynamism of social media. For example, on Twitter, you sign on to “follow” those you fi nd interesting. Should people fi nd the information you share interesting, you can be followed in the same fashion, provided your security settings are not set to private. Th ere is no rule of reciprocity, and everyone’s list of “tweeters” – the people one follows or those following another person – is unique.

Google Reader uses the same principle, and Facebook is very similar. With Google Reader, you can follow news sites, blogs and other regularly updated sites and be notifi ed when they are updated. On Facebook, you receive information from your list of friends.

Instantaneous information Th e main principle of social media is that user-generated content is made available to other users. But what can

OWeb 2.0An introduction to social mediaBy Dave Macdonald, CMA

A LinkedIn event listing for the recent CMA BC Members Conference shared presenter bios and other information.

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Dave Macdonald, CMA is a Special Projects Administrator at WPCG, and the Online Communities Director for the CMA BC Vancouver chapter. Connect with him on LinkedIn, Twitter (@davemacdonald) or his blog at davemacdonald.ca.

C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i astrategy

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these tools and media provide to those who don’t, or have yet to, spend much time online?

As mentioned above, the first benefit is rapid sharing of information. In mid-January when U.S. Airways fl ight 1549 plunged into the Hudson River, Internet users were able to follow the news live via Twitter from people in the area who were on boats rescuing survivors, and on the plane itself. Those seeing the story unfold on the news were sometimes hours behind. The method of following this story was simple – a search for “Flight 1549” on Twitter returned dozens of accounts. What was drama in January is now part of regular discussion – a search for “Flight 1549” fi ve months later results in news about luggage being returned to passengers.

A second product of social media is the formation of active networks that typically focus on achieving some relatively short-term objective (shorter-term goals often require less formal organization and rely on the momentum of core proponents). Social media creates the right environment for these groups to move forward.

In his 2008 book, Here Comes Everybody, Clay Shirky describes this phenomenon as “collaborative production.” For certain exercises, social media tools remove barriers and give people a collaborative space in which to make things happen. Shirky opens his book with a prime example involving a stolen cell phone. Th e police dubbed the owner’s phone “missing,” so her brother created a website outlining the details of the theft. A proactive audience formed around the site, exchanging messages and clues until the identity of the thief was established. Within six weeks there was an arrest and the phone was recovered. Th is chapter is currently available for free at books.google.com.

Th e anecdote borrowed from Shirky is certainly a niche example, but “niche” is a word that aptly describes social media. With these tools we are able to engage in our own niche activities, alongside experts and novices alike. Th e fl ow of information facilitates quick learning, rapid network growth and opportunities to self-promote.

Brand-buildingSelf-promotion, that is, building your brand through social media, is an art – and no one really knows its limits. With over six million people on Twitter and nearly 200 million on Facebook, there is a serious case for using social media to build a brand.

While there is no limit on the self-promotion that can occur through social media, it’s just like any other platform: if people get tired of a spokesperson, a message or a brand, they “stop watching that channel.” Th e content needs to be fresh, and people need to be authentic. Th ere is actually little value for “grazers” because the real value is in discourse and engagement. It’s participative learning.

Words of caution – security and profi le managementAs with any personal information, balancing authen-ticity with security and pragmatism is of utmost importance. Th e bottom line is, only share information you don’t mind the world seeing. Th ere have been few signifi cant breaches of social media sites, but to deny any risk would be rash.

Taking social media offl ineWe are fortunate in British Columbia to have a rich online culture. Th ere are multiple opportunities to meet the people we engage with online. Twitter and Facebook users can organize events or “meetups” (or “tweetups”), while sites such as meetup.com focus exclusively on events and matching people with events they are interested in. With any social media site there are opportunities to form groups, join groups and meet people of specifi c interests.

Why do this? Engaging offl ine is as important as the online component. Behind every Twitter feed or blog there is a person whose ideas and contributions likely aren’t being fully capitalized on by their Internet contributions alone. Engaging people online off ers an opportunity to take networking to extents we often don’t experience through traditional means. For example, if through a Twitter conversation you fi nd out a CEO you’ve been planning to meet in person to pitch your services to is an avid cyclist, just as you are, there is a connection that could pay off immensely.

The CMA BC Vancouver chapterWith this in mind, the Vancouver CMA BC chapter has recently developed an online presence – a blog at www.cmavancouver.com and a Twitter page at www.twitter.com/cmavancouver, as well as profi les on LinkedIn and Facebook. Any CMA in B.C. can join the LinkedIn group, and everyone is welcome and encouraged to do so. Th e goal is to engage members in discourse, exchange information and provide opportunities to connect both online and off .

With a basic understanding of social media, it’s very easy to participate – whether you’re just curious or are looking to promote your brand or company online. Social media has people talking, and no one knows where it’s heading, but this is a time when the general public can be very close to the cutting edge of Internet technology – and we hope CMAs will be able to fi nd their way around. ■

Self-promotion, that is, building your brand through social media, is an art – and no one really knows its limits. With over six million people on Twitter and nearly 200 million on Facebook, there is a serious case for using social media to build a brand.

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oday a front-desk secretary who operates your customer service account on Twitter can have a more positive impact on your brand than the transit ads you run, or the

direct-mail campaigns you execute. A junior executive who posts the wrong comments on a competitor’s blog can also undo your positive branding and marketing eff orts in one click.

The case for social mediaMany senior executives are opting not to make use of social media, a highly eff ective but also hard-to-control marketing tool. Some will claim there are no case studies measuring the eff ect of social media marketing, but this is far from the truth. Th ere are numerous documented social media success stories, from companies such as Comcast and Ford to individual entrepreneurs such as Gary Vaynerchuk of winelibrary.com, who went from $4 million to over $40 million in sales using video-blogging, Twitter and other social media platforms.

Social media tools and networks are a signifi cant force that is growing – one you can’t aff ord to avoid. Th e truth is in the numbers:

• Facebook: 190 million users• LinkedIn: 35 million professional users

representing every company on the Fortune 500• Twitter: 6.5 million users; 1.3 billion messages

per year and growing• YouTube: 1 billion views per day (the second-

biggest search engine behind Google)Th e consumer is already talking about your brand

online, and if you’re not online listening and engaging, you’ve lost control of your brand. Th e great news is, by getting proactive you can begin to positively direct and amplify these online conversations.

Your social media strategy – things to considerBefore using social media we need to understand some core principles:

Social media messaging is not produced solely by a marketing team. Zappos, a billion-dollar online shoe company, makes it mandatory for all staff to use Twitter. Expand marketing roles to everyone, taking the number of marketing messages and multiplying them signifi cantly online.

Provide social media training to all staff . More important than training on the tools is training on the principles of using the tools. Th ere is a specifi c etiquette to engaging people in each of the major networks.

Have a social media policy and process that outlines how to engage customers online. Th is should include guidance on how to deal with negativity, social events and clients. One important note: if your guidelines are too stringent and you take the fun out of Twitter or blogging, don’t be surprised if your eff orts fall fl at.

The sociable enterpriseWhy you need an integrated social media marketing strategy todayBy Shane Gibson

“Social media is making past management approaches obsolete. The new strategies must recognize that the new backbones of infl uence are now networks of ordinary people.”

–Peter Aceto, CEO, ING Direct, itbusiness.ca, May 12, 2009

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In the spirit of transparency, many organizations, such as Intel, post their social media guidelines on their websites (www.intel.com/sites/sitewide/en_US/social-media.htm) for all of their stakeholders to see.

Listen and engage. Social media is about listening, community, adding value and entertaining people. It’s about dialogue. It’s a multilateral communication medium. “Talking at” people or “blasting” updates is not true engagement, and it isn’t good for your brand either.

Don’t outsource your personal brand. Everyone needs to operate his or her own Twitter account, even the CEO. Th is transparency and direct communica-tion enhances your brand. Sending your secretary to a cocktail party on your behalf isn’t nearly as eff ective as going yourself – people want to meet the personality of the brand. Th e same goes for online networking.

Implementing a social media strategyIn order to profi t long-term from social media, you need a well-thought-out plan. Here are six steps to implementing a social media marketing strategy:

1. Identify your goal. Getting on Facebook because some marketing guru said you should is a bad idea. Blogging just because your competitors are is equally bad in its strategic signifi cance. Here are good examples of annual goals:

• To increase staff recruitment by fi ve per cent this year by engaging 18-to-23-year-old men and women in B.C. through interactive blogs, community-driven video content and Twitter.

• To reduce marketing costs 90 per cent by ceasing all print advertising and using blogging, YouTube, Facebook and Twitter to market real estate developments.

2. Identify your target audience. Having a message that rises above all the noise online is critical. Achieve this through targeted “nano-casts,” as Jay Levinson, author of Guerrilla Marketing, calls them. Traditional media is about broadcasting; social media is two-way nano-casting. You will have to drill down and defi ne several niche target groups.

3. Pick the right platforms. Twelve months ago Twitter wasn’t a great place to engage a CEO or connect with elected offi cials. Today it’s the perfect tool for that. Be careful in looking at historical data and at what’s happening right now when choosing your platforms. Invest in existing networks and platforms, but also look at which ones have the biggest opportu-nity for growth. Invest in building your network before the masses rush in.

4. Map out social etiquette. Each platform (Facebook, LinkedIn, Twitter, etc.) has its own social rules and norms. If you’re not sure what they are, connect with or follow someone who is established and observe his or her habits and conversations, and the types of content they post over time.

5. Implement a listening strategy. Social media monitoring, social searches and reading other people’s blogs should all be part of your listening strategy. In order to be eff ective at infl uencing people, we must have a high level of empathy and understanding. If we listen intently enough, our market will expose the missing solutions and “pains” that need fulfi llment. Listening tools include such sites as search.twitter.com and www.google.com/alerts.

6. Know core pains and communicate your solution. Hopefully by listening and directly engaging

Shane Gibson is a professional speaker, author and marketing strategist. Connect with Gibson on Twitter (@shanegibson) or on his blog at closingbig-ger.net. This article is based on excerpts from Gibson and Stephen Jagger’s new book Sociable! which will be available at sociablebook.com later this year.

Key Tips for Employers

Want to know how many people viewed the job that you posted in the past day, week or month?As an employer you can use the Reports feature to see job views or employer description views on an hourly basis to a monthly basis. This is just one of the many reporting functions of cmabcjobs.com.

Want to advertise your company to CMAs and CMA students?Banner advertising is available on a monthly or yearly basis on both the employer and the jobseeker areas of the website at very competitive

rates. cmabcjobs.com boasts roughly 35,000 banner ad impressions per month. Contact [email protected] for more details.

Want to send a response to everyone who applies letting them know about next steps?Use the Auto-Response function in the Employer Centre to create a customized message that will automatically send a reply email to anyone who applies for your posted job through cmabcjobs.com. An example would be,”Thank you to everyone who submitted an application with [Your Company]. We will contact all applicants within two weeks.”

CMABCJobs-Ad.indd 1 4/30/09 1:34:51 PM



your target markets you will develop a grounded and complete view of what ails them or their businesses. Th e next step is to communicate why your solution is unique and valuable through an engaging, contribu-tion-focused social media campaign.

In summary, consumers and companies are adopting social media at a breakneck pace. According to Neilson Netratings from February 2008 to February

2009, Twitter’s user base grew 1,382 per cent and Facebook grew 228 per cent, the 35-49 demographic being the largest group contributing to this growth. With a strong strategy and understanding of the core principles of being “sociable,” your company and community can benefi t from this open and transparent method of marketing through engagement. ■

CMA Executive Development SeriesVictoria – Sept. 16, Oct. 14, Nov. 4, Dec. 2Vancouver – Sept. 17, Oct. 15, Nov. 5, Dec. 3

The CMA Executive Development Series is a four-part series facilitated by author and professional speaker Shane Gibson, focusing on key trends and challenges business leaders face today.

Part 1: Implementing Social Media Into Your Business Strategy• The role of social media in marketing strategy• Core social media marketing success principles• How to develop and execute a social media

marketing plan that works

Part 2: Executive Presentation Skills• This program has tools: how to prepare for a

major presentation or pitch

• Eight steps to delivering a winning presentation• Strategies for presenting to different personality

styles

Part 3: Partnering and Stakeholder Engagement Strategies• The stages of relationship and partnership

development• Key steps in systemizing your relationship and

stakeholder development planning• Tips on handling and avoiding roadblocks

Part 4: Leadership 2.0• New rules for engagement in a digitally transparent era• Web 2.0 collaboration and learning tools• Creating an environment that is productive and

engaging for the millennial generation/generation Y.

To learn more about the CMA Executive Development Series, visit the new CMA British Columbia CPLD website: www.cmabc-pd.com.

Canada Wide Media Limited is very proud to be working

on Update magazine on behalf of the Certifi ed Management Accountants of British Columbia.

Introducing your new

Advertising Account Manager Karen Rice

Please contact me with any ideas, questions and feedback

regarding advertising inUpdate. I look forward to

working with you!

[email protected]


C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i aCMAnews | 27

he CMA Strategic Leadership Program (SLP) is the most critical step in shaping the professional identify of a CMA. It’s what distinguishes the CMA designation from

the other accounting designations in Canada and forms the basis for CMAs’ diff erentiating competencies.

Th e SLP was introduced to the CMA designation in 1995 as the “Professional Program” and underwent the change to the current name in 2000. Th e program has had a number of changes in the past few years, and many CMAs who went through the SLP in its early years may not recognize the current version.

Program descriptionTh e SLP is a two-year part-time program undertaken after the CMA National Entrance Exam. It is the fi nal stage of the pathway to the CMA designation and includes the CMA Board Report. Th ere are two intakes for the SLP every year – in September and January. In order to allow all students to complete the SLP concurrently and graduate together, the January intake runs on a more compressed schedule than the September intake.

Program structureEach year of the SLP consists of three Saturday-Sunday interactive sessions, for a combined total of six sessions. During each session the candidates meet in a classroom setting, with two moderators facilitating each group. Th e moderators are highly experienced CMAs with teaching experience, since fellow members best understand the competencies of a CMA and the requirements of CMAs in industry and the business community. Between each of the interactive sessions there are a number of written assignments, reports and online activities. Th ese components, along with concurrent work experience, constitute the learning elements of both years of the SLP.

Th e interactive sessions consist of large-group and small-group discussions, activities and presenta-tions, all designed to integrate knowledge, skills and behaviours. Some of the written assignments are graded by a pool of national markers, while other elements, such as demonstrations of teamwork, com-munication and professionalism, are evaluated by the interactive session moderators. Th e combination of written and interactive assessments provides both evaluation and feedback to candidates. Th is feedback, along with regular assessment of the candidates’ work experience, is part of their ongoing professional and personal development in the program.

Th e fi nal stage of the SLP is the CMA Board Report. The board report is a large-scale, comprehensive business case that integrates management, strategy and accounting, and demonstrates candidates’ ability to utilize all of the CMA competencies. Th is case study, typically completed in teams of four, consists of a written submission and a presentation to a panel of CMAs, and is the fi nal evaluation component for the CMA designation.

SLP entrance requirementsTo enter the program, candidates must have a uni-versity degree or an equivalent in relevant work experience and education (degree waiver). Th ey must also have acquired a knowledge base, typically by taking 16 or more related courses at a college or university, or through the CMA Accelerated Program. Th ese courses cover such areas as mana-gerial and fi nancial accounting, fi nance, tax and auditing, which are part of the typical accounting stream. Th e requirements also include a variety of non-accounting and fi nance business courses designed to broaden students’ knowledge base. Th is breadth of knowledge forms a foundation for the SLP

The CMA Strategic Leadership Program: an overview

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CMA

Required coursework for the CMA National Entrance Exam

CMA Strategic Leadership Program (SLP)

CMA National Entrance Exam

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and allows students to apply strategic management skills to all areas of their workplace, rather than just in the accounting offi ce.

To enter the SLP, students must also pass a national entrance exam, which tests their knowledge of the material in the CMA syllabus. Candidates at certain post-secondary institutions accredited by CMA Canada may be exempted from the national entrance exam if they meet the minimum grade/course require-ments during their undergraduate degree.

SLP changesTh e SLP has undergone several recent changes to its program structure and curriculum, including:

• Increased focus on individual knowledge and skills, especially in the fi rst year.

• Increased technical content (functional skills) built into the program.

• Elimination of day two of the entrance exam – this was replaced with a case exam taken after the fi rst year of the SLP.

• Change in grading of the board report from a blended mark to a must-pass fi nal evaluation.

Also, the names Development Phase and Application Phase have been applied to the fi rst and second years of the SLP, respectively. Th e concept behind the name changes is that “Development Phase” more accurately describes the stage where candidates build the skills in integrating technical and analytical components that are tested in the case exam, while “Application Phase” describes applying these skills in team settings more practically to the workplace. Th e Application Phase skills are then tested in the board report.

Reasons for changes to the SLPTh e introduction of the new national CMA compe-tency map in 2006 was the main reason for the changes to the SLP. Th is map provided a more struc-tured approach to the knowledge and skill profi le of the graduating CMA candidate. Prior to 2006 the competencies were defi ned mainly as topics to be

learned – i.e. as educational elements. Th e compe-tency map reframed them as a set of skills and behaviours a CMA can bring to the workplace and contribute to the success of any organization.

The competencies include both functional and enabling areas. Functional competencies include strategic management, risk management and gov-ernance, performance management, performance measurement, fi nancial resource management and fi nancial reporting. Four enabling competencies were identified: problem-solving and decision-making; leadership and group dynamics; professionalism and ethical behaviour; and communication.

Th e new SLP program, while bearing many simi-larities to the previous version, was designed to incorporate and blend these 10 areas of competence. Th e goal was to incorporate the technical components (functional competencies) more intensively into the program, particularly in the fi rst year, with increas-ing focus on strategy, teamwork, professionalism and communication in the second year. Th e case exam and board report changes were intended to increase the overall rigour of the program.

All of the functional and enabling areas are developed, demonstrated and evaluated in the SLP and are core to the CMA professional identity and skill set. While the SLP will continue to evolve based on employer and candidate feedback, as well as analysis of current results, it will remain the essential process in the formation of the CMA – today and in the future. ■

To enter the program, candidates must have a university degree or an equivalent in relevant work experience and education (degree waiver). They must also have acquired a knowledge base, typically by taking 16 or more related courses at a college or university, or through the CMA Accelerated Program.


Geoff Bryant is a Junior Accountant with Océ Display Graphics Inc., and is currently a student in the CMA Strategic Leadership Program. He is also a member of the Update Editorial Task Force.

he transition from module one to module two of the CMA Strategic Leadership Program (SLP) had us analyzing strategic and operational issues at an increased level

of depth. Assignments are increasingly complex and test our critical-thinking skills, as multiple decisions need to be made during analysis. Module two also introduces candidates to real-life problem-solving scenarios that focus on the functional competencies of the SLP program.

Module two assignmentsModule two began with an assignment involving capital investment decision-making and how it can aff ect compensation plans and performance-measurement systems. We had the opportunity to apply capital budgeting (investment appraisal) methods such as net present value, internal control analysis, fi nancial reporting classifi cation and presentation, as well as other concepts related to the CMA competency map.

Another module two assignment was an online group discussion on approaching and implementing strategy, during which everyone had the opportunity to challenge the viewpoints of two renowned authors on strategy, C.K. Prahalad and Michael E. Porter. During module two we also had our fi rst practice case exam, which gave us an idea of what to expect this August when we write the case exam.

Interactive sessionTh e interactive sessions aff ect candidates in diff erent ways. With each assignment comes a higher expecta-tion and required level of critical thinking about the issues presented. Th e interactive session allows us to exchange ideas about assignments as we continue to assess where improvements are needed.

One exercise I found particularly helpful was working through the practice case exam as a group. My group split into two smaller groups, wrote out our case fi ndings and then exchanged answers. One lesson I learn at every SLP class is that each class member has diff erent ideas that add value to the overall analysis from beginning to end. Th e diff erent perspectives and approaches to problem-solving are a key take-away for me, especially as everyone in the SLP program is at diff erent career stages and has diff erent skill sets. By working as a team, those who struggled in certain areas benefi t from the knowledge and experience of others.

Case study analysis, at the level expected in the SLP program, does not come overnight. Each module, and the corresponding assignments, allows us to build upon existing and newly acquired skills as we apply the structured case approach to business cases and prepare for the case exam.

Application of SLP conceptsYear one of the SLP program doesn’t focus on one particular skill or emphasize one particular concept. Th e assignments are designed to cover a broad scope of accounting, management, strategy and other business issues, requiring candidates to think beyond the facts of a case – a problem I had in module one. Th is new way of thinking transfers easily to the workplace, as it entails looking beyond the initial impact of a decision. I have begun to reassess my work assignments and have found that considering all the short- and long-term eff ects of a decision can sometimes change my approach to tasks.

As we enter module three, I’ll be focusing on the case analysis areas I need to improve on. I left the interactive session for module two knowing where my attention should be focused so that I am successful in the case exam this August. ■

Diary of a CMA in trainingThe journey continues: module two and beyondBy Geoff Bryant, Candidate in the CMA Program

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30 | CMAnews C M A U P D AT E | S U M M E R 2 0 0 9 | C e r t i f i e d M a n a g e m e n t A c c o u n t a n t s | B r i t i s h C o l u m b i a

ongratulations to these CMA British Columbia members who have been promoted or accepted a new career opportunity:

After 38 years as principal of J.R. Berkson & Associates, Inc., Jerry Berkson, CMA, FCMA recently merged his practice with Entrust LLP, Chartered Accountants (www.entrustcas.com), a mid-size public practice serving Metro Vancouver and Fort St. John. Jerry specializes in accounting, auditing, assurance, income tax compli-ance, partnerships, estates, trusts and corporate restructuring.

Karilyn Bolton, CMA has joined the City of Quesnel as Director of Finance. Prior to taking this position, Karilyn was a corporate accountant with West Fraser Mills Ltd.

Gerald Chang, candidate in the CMA Executive Program, recently joined ImmunoPrecise Antibodies Ltd. as Chief Financial Offi cer. ImmunoPrecise, a Victoria-based company that has grown signifi cantly in the past fi ve years, designs and develops antibodies for some of the world’s most renowned universities, research facilities and pharmaceutical companies. Gerald will be part of the executive team overseeing growth and expansion strategies for ImmunoPrecise. Previously, Gerald was Manager of Corporate Development for one of B.C.’s largest privately owned corporations.

Rachel Cuthbert, CMA has taken on a new role as Business Intelligence Analyst at Aritzia, following a recent successful SAP implementation. As part of the business intelligence team for internal reporting, Rachel will maintain a close relationship with business operations to ensure informational requirements are clearly understood and delivered. Most recently Rachel was a product planner at Aritzia.

Daisy-Lee Fitzgerald, CMA has moved from Port Metro Vancouver to the Chief Financial Offi cer Branch of Human Resources and Skills Development Canada. She is now Head of Accounting Operations at the Vancouver offi ce.

Doris Good, CMA has taken on a new role with the provincial government and is now Training Coordinator for the Consumer Taxation Audit Branch of the Ministry of Finance. Previously Doris was an auditor with the Consumer Taxation Audit Branch of the Ministry of Finance.

Mehmud Karmali, CMA assumed a new role earlier this year as a Director of Health Systems Planning for Cardiac Sciences with Fraser Health, allowing him to focus on the development of cardiac care across a large region encompassing 12 hospitals. Mehmud previously spent almost four years working as a Director of Acute Programs at Royal Columbian Hospital.

Serguei Kotlikov, CMA recently joined HSBC Bank Canada as Assistant Vice President, Tax. Prior to joining HSBC, Serguei was a Senior Tax Manager with the Vancouver offi ce of Ernst & Young LLP.

Ron Matthews, CMA recently joined Avantage Partners as a consultant. Avantage assists its clients in achieving a “connected business” by bringing together the right technology and management practices to streamline their operations. Prior to joining Avantage, Ron was Director, Business Solutions at Visiphor Corporation.

Gregory Nesbitt, CMA recently joined the Treasury Board of Canada Secretariat as a Senior Analyst. Prior to joining the Treasury Board, Gregory was an Internal Auditor with the Interior Health Authority.

Lisa Lak, CMA is now Financial Controller at PPC Worldwide Canada EAP Services Ltd. Before moving to PPC Worldwide, Lisa was a Senior Project Business Analyst with Fluor Canada Ltd.

Connie Lee, CMA has moved back to B.C. from the U.S. Connie is now an Assistant Vice President for HSBC Bank Canada, heading up planning and analysis. Previously, Connie was on a four-year international assignment with HSBC Bank USA, where she implemented information delivery for a global fi nancial platform.

Stuart Mah, CMA recently joined the University of British Columbia in the Enrollment Services/Student Develop-ment & Student Services department.

Donna Porter, CMA has taken on the role of Director, Accountability and Reporting with the Ministry of Advanced Education

Members on the move

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and Labour Market Development. Previously, she was a Manager in the Customer Service and Information Branch of the Ministry of Finance.

Patrick Seeley, CMA joined the B.C. Liquor Distribution Branch as Director, Internal Audit. Previously Patrick was working as an indepen-dent consultant providing risk management advisory services.

David Splett, CMA has relocated to Lima, Peru and is now Vice President, Finance and Administration with Compania Minera Antamina SA. Before moving to Peru, David was Director, Investor Relations with Teck in Vancouver.

Lynn Wise, CMA has taken on a new role at Ritchie Bros. Auctioneers as Director, Operational Accounting. Lynn previously held the positions of Senior Manager, Operational Accounting and Controller, Canadian Operations with Ritchie Bros., the world’s largest auction company for industrial assets. ■

Have you recently moved to a new company, or would you like to welcome a new CMA to your company? Submissions to Members on the Move can be emailed to Tiana Mah at [email protected].

Welcome to these new members of CMA British Columbia:

Harvey Watson Walker, CMA has retired to Qualicum Beach, B.C. Previously Harvey was with the Government of Alberta Department of Energy for 26 years in a variety of fi nancial and audit roles. His most recent position was Executive Director of Finance.

Grace Li, CMA is a Financial Analyst with Star Group Limited in Hunghom, Hong Kong. Grace was formerly a Financial Analyst with Petro-Canada in Ontario.

Prior to moving to Victoria, B.C., Leo Gauthier, CMA was Regional Manager, Financial Management with Public Works and Government Services Canada in Edmonton, Alberta. Leo is now Senior Financial Analyst, Engineering Assets with Public Works in Victoria.

Beverly Engele, CMA is now enjoying retirement in Surrey, B.C. Previously Beverly was Vice President, Finance and Operations with the Lung Association of Saskatchewan, where she worked for 20 years.

Member in memoriamWe wish to extend our sympathies to family and friends of the following member who recently passed away:

William (Bill) Frederick MacDonald, CMA

Bill started his fi nancial career in 1962 as Controller/Manager of Materials for Dahmer Steel in Kitchener, Ontario, and received his RIA designation one year later. In 1976 he moved to Lear Siegler Industries, where he took on the role of Assistant Controller. In 1982 he joined Apex Metals Limited as Controller/Vice-President, where he remained until retirement in 1989. A supporter of CMA BC, Bill was a chapter director, and chapter chairman for the Grand River chapter in Kitchener from 1962 to 1968.

It is with sadness we report that Bill passed away on April 29, 2009. If you would like to send a note of condolence to Bill’s family and friends, contact Rick Lightheart, CMA, FCMA at 604-484-7004; 1-800-663-9646, ext. 7004; or [email protected].

New and returning members of CMA British Columbia

Be sure to visit our websitewww.entrustcas.com

e. [email protected]. [604] 821.0553

Entrust is pleased to announce Jerome Berkson has joined our team as Senior Principal.

Contact Jerome for our professional value added solutions to meet your organization’s accounting, tax and auditing needs.

Leading the way!Jerome Berkson, CMA, FCMA

Proud sponsor of 2010 Olympian Alexa Loo, PGS Snowboarder

In Richmond Phone: [604] 278.6468 | Toll-free: 1.888.578.6468In Fort St.John Phone: [250] 787.1377

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his year’s sold-out third annual Members Conference (May 26-27) brought over 350 members, CMA students and candidates and business professionals together for two days of networking and sharing best

practices on how to manage in today’s challenging economy.Th irteen diff erent professional development workshops were

available, with topics ranging from change management and leadership to IFRS, risk management and governance, Excel, systems implementation, carbon reporting and crafting strategy. Keynote speakers included Mia Maki, CMA, FCMA, chair of the CMA British Columbia Board of Directors; Michael Campbell, business analyst, author and host of Money Talks; Andrea Southcott, President of TBWA Vancouver; and Michael Kerr, “workplace energizer.” Mark your calendars today for next year’s conference May 18-19, 2010 at the Hilton Metrotown in Burnaby, B.C. Further details will be available later this year on cmabc.com and in Update magazine.

1. Ken Puls, CMA leading the Excel: Spreadsheets That Last workshop. 2-3. Conference attendees engaging in group discussions at the leadership

wake-up call and IFRS workshops. 4. Networking at the wine-tasting reception May 26. 5. A display

promoting conference sponsor Thompson Rivers University. 6. Keynote speaker Michael Campbell. 7. Conference sponsor Robert Half International’s

booth at the conference.

2009 CMA British Columbia Members Conference

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11. Ron Matthews, CMA presenting the workshop Change Management in the 21st Century. 12. Social media expert Shane Gibson leading the 360 Degrees of ROI workshop. 13. Meryle Corbett, CMA, FCMA moderating a panel on systems implementation: Survivor Strategies for Small Businesses During Diffi cult Economic Times.

8. Crafting Strategy in Uncertain Times presenters Katie Wyka and David Gibbons. 9. “Workplace energizer” Michael Kerr, May 27 luncheon keynote speaker. 10. Practising a happy dance with Michael Kerr.8

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CMA Executive Learning SeriesTh e Executive Learning Series hosted by the CMA Executive Program features guest speakers from the business and academic communities. Th is past spring two learning series events were held.

In May Saul Klein, Lansdowne Professor of International Business at the University of Victoria, spoke on globalization in turbulent times, and how business leaders need to re-examine emerging markets. In June, Shane Gibson, President (North America) of Knowledge Brokers International, presented Leadership 2.0, focusing on leading and collaborating with stakeholders and employees in a digitally connected marketplace.

CMA sponsorships and events

New Elite Employers CMA British Columbia would like to welcome Imperial Parking Corporation (Impark) to the CMA Elite Employer Program.

Junior Achievement of B.C.CMA British Columbia sponsors a number of events that support the business community and the development of future business leaders. Most recently the Society was a supporting sponsor of Junior Achievement of B.C.’s student awards. Junior Achievement is a not-for-profi t organization dedicated to educating young people about business. Junior Achievement delivers a number of business education programs to youth in elementary, middle and high school. Members interested in volunteering can fi nd out more at www.jabc.org.

BIV Colour SeriesBusiness in Vancouver Newsgroup’s Colour Series brings together business leaders focused on profi t-ability, sustainability, investment and philanthropy. CMA British Columbia is a sponsor of this year’s series and recently attended the Green event (June 11), which focused on sustainability. Don’t miss the remaining two events, which feature keynote speakers on business investment (September 24, 2009) and philanthropy (December 2009). For more information on the Colour Series visit: www.biv.com.

CMA Executive TourTh is spring and summer CMA British Columbia hosted events around the province. Together with local chapter executive boards the Society organizes an annual Executive Tour, which recognizes members who have held their CMA designation for 25, 30, 35, 40, 45, 50 and 55 years. A list of all members recognized at this year’s events will be published in the fall 2009 issue of Update.

Afternoon with a CMAIn June an Afternoon with a CMA event took place at the Royal Canadian Mounted Police (RCMP) headquar-ters in Vancouver. CMA British Columbia would like to thank Max Xiao, CMA of the RCMP for helping to organize the afternoon. Th ese events allow students interested in the CMA designation to meet with CMAs at their workplaces, network and ask questions about careers in accounting, fi nance and management.

Keynote speakers Shane Gibson (left; Leadership 2.0) and Saul Klein (right; Globalization in Turbulent Times).

Wendy Ming, recipient of the 2009 Junior Achievement Award for Excellence and Leadership (left) with Shannon Thompson, Senior Manager, Marketing.

Discussing and listening to Leadership 2.0, a presentation by professionalspeaker, author and marketing strategist Shane Gibson June 18.

Networking at the May 5 CMA Executive Learning Series event.

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MA British Columbia chapters are an essential link in the Society’s relationship with its members and the local

community. For each chapter, an executive committee of CMAs is responsible for organizing and promoting activi-ties to encourage member involvement, networking and professional development throughout the year.

To recognize the eff orts of these commit-tees and learn about their upcoming initiatives, Update spoke with Holly Lodto, CMA – chair of the Victoria Chapter.

Can you give us a brief description of your role as a chapter chair?As the Victoria Chapter has 17 hard-working and dedicated directors on its board, my main role is to organize meetings, prepare agendas and coordinate chapter initiatives.

What are some of the challenges you face in the Victoria Chapter?One of our biggest sources of funding is the proceeds of an annual three-day joint FMI-CGA-CMA professional development event. With the current economic challenges, we anticipate reduced professional development funding from employers and are actively seeking sponsors to help defray costs. Th is event is an ideal opportunity for sponsors to reach out to over 100 professional accountants per day. We are also always on the lookout for speakers.

Finding meeting space and organizing the growing numbers of networking events the chapter hosts have produced their own challenges, but these fl ow out of our success in creating an active chapter.

What are some of the upcoming chapter initiatives you have planned for 2009?A survey conducted at the holiday social showed members wanted more venues for networking, more professional development opportunities and improved communica-tions. As a result we have now instituted after-work mingles in addition to our popular networking breakfasts. We are also organizing an advanced Excel course, a networking skills workshop and a confl ict-resolution workshop for members.

Lastly, the board has also started posting meeting minutes to the CMA BC website to further improve communications among members.

What are you doing in your market to support growth and brand awareness?Not enough. Because CMAs are primarily owners, employees or consultants to various organizations (rather than in public practice), networking with other CMAs is key to developing personal career goals and building new business relationships. Creating networking and professional

development venues has been the major focus of the chapter.

I would like to see the chapter become more involved in promoting volunteer opportunities. A positive contribution from CMAs to their local communities is one of the best advertisements for the designation.

I would also like to see our chapter develop a “bank” of local CMAs who enjoy public speaking and who would be willing to speak at other organizations’ events.

Why did you decide to become a CMA?I happened to meet a very knowledgeable and professional individual who introduced me to the CMA designation (thank you Betty Weber, CMA). Th e CMA Accelerated Program and SLP were also the most direct and cost-effi cient route towards an accounting designation. It also allowed me to do the accounting work I enjoyed rather than article for an accounting fi rm.

Why did you choose to get involved with the Society

at a chapter level?Th e people are the most rewarding part of being active with the chapter. I fi nd the depth and breadth of knowledge, and experience, of our members fascinating and inspiring.

Not surprisingly, this is the reason I became involved. I knew the greatest strength of the designation lay within CMAs themselves. I was interested in fi nding ways to help CMAs connect with one another. ■

If you’re interested in getting involved with the Victoria Chapter, please email Holly Lodto at [email protected].

Chapter profi leVictoria Chapter

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Holly Lodto, CMA, Victoria Chapter ChairManager of General Ledger and Reporting, Vancouver Island Health Authority


Nicole Beach, CMA, Jarra Ford, CMA and Debbie Kulesh, CMA – all of the Victoria chapter – at a joint FMI-CGA-CMA professional develop-ment event with keynote speaker Bernie Magnan, CMA, FCMA.

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Summer 2009 Certiﬁ ed Management Accountants • British ... · The next evolution in accounting Management View 17 | Method for your message Communication is key for accountants