http://www.canada.com/vancouversun/news/editorial/story.html?id=712db714-b636-4563-b78f-ced1b034c46a&p=1
Summary
The article that I read was written by David Suzuki and Nancy Olewiler commenting on the government cutting taxes on diesel fuel. Diesel is used primarily in the trucking industry the recent price increases in diesel have been reducing margins for truckers in an industry with small margins to start with. Suzuki and Olewiler call the government plans to reduce the tax of diesel as a band aid solution. Their concern is that indeed truckers would have reduced fuel costs in the short term which would save a number of possible bankruptcies in the industry.The fear is that in the long term, the number of trucks on the road would increase along with greenhouse gas emissions. Suzuki, Olewiler and the Canadian Trucker's Association (CTA) support a program that would improve the fuel efficiency of trucks at an annual cost of $56m opposed to a $600m reduction in tax revenue from the proposed tax cut.
Connection
The connection between the article and the information in the text is COGS. In particular, the Freight-in figure used to calculate COGS. In this case, a merchandising business that has a high inventory turnover would likely be faced with higher delivery costs (Freight-In) in line with the increase in costs that truckers are facing due to higher diesel prices. It is a likely conclusion that the Gross Profit and net earnings of the merchandise business would decrease as a result.
Reflection
The article reinforces the idea that an accountant needs to have a knowledge base outside of just accounting and the importance of keeping up-to-date with events happening in other industries. If a merchandising business is faced with increased transportation costs, it can do two things - absorb the cost or pass the price increase to customers. If the business chooses the former, the profit margins will be reduced. If the business chooses the latter, it would likely face a decrease in demand (depending how essential that good is) for its products reducing sales. It is the classic catch-22 for business...
Tuesday, October 5, 2010
Chapter 12
http://www.cbc.ca/news/background/groupaction/whoswho.html
Summary
I approached this entry a little differently... I read the chapter, in particular, the career profile on Alfonso Gagliano and I knew that that name sounded familiar. So I started to do some googling and I found two sources, a Wikipedia entry on him and a CBC article on the sponsorship scandal that detailed his alleged involvement. The Wikipedia article states that he was the highest ranking Liberal member to lose his job. Then Prime Minister Paul Martin, fired Gagliano acting on information from the Gomery report. It is reported in Wikipedia that Gagliano sued Paul Martin for defamation of character and wrongful dismissal. It seems that controversy follows Gagliano, a NY Post article suggested ties to the mafia - ties that Gagliano denies. The CBC article reports basically the same thing as Wikipedia, save for the alleged ties to the mafia.
Connections
The connection is the person - Gagliano. The profile in the book illustrates that the knowledge and skills developed (logic, good organization and careful checking of facts) through the CGA program are valuable in his jobs as an accountant, a politician and as a business owner. In Gagliano's own words, his job as a politician calls for "tact, good decision-making skills, an ability to reason and the tendency to check and double-check something."
Reflection
I really do think that the skills developed in obtaining an accounting designation such as the CGA or CA etc. are valuable in accounting, business and other jobs outside of business. There is some irony in the situation that Gagliano is in and how the text portrays him as a good example of the value of accounting skills. It also illustrates that we can teach skills, we can discuss ethics but we can’t teach someone to be ethical. Is Gagliano really innocent – personally, I don’t believe he is. As a further thought, I think the authors of the book realized this contradiction and have since removed his career profile from the latest edition of the text. I guess that's what happens when we use a 15 year old book...
Summary
I approached this entry a little differently... I read the chapter, in particular, the career profile on Alfonso Gagliano and I knew that that name sounded familiar. So I started to do some googling and I found two sources, a Wikipedia entry on him and a CBC article on the sponsorship scandal that detailed his alleged involvement. The Wikipedia article states that he was the highest ranking Liberal member to lose his job. Then Prime Minister Paul Martin, fired Gagliano acting on information from the Gomery report. It is reported in Wikipedia that Gagliano sued Paul Martin for defamation of character and wrongful dismissal. It seems that controversy follows Gagliano, a NY Post article suggested ties to the mafia - ties that Gagliano denies. The CBC article reports basically the same thing as Wikipedia, save for the alleged ties to the mafia.
Connections
The connection is the person - Gagliano. The profile in the book illustrates that the knowledge and skills developed (logic, good organization and careful checking of facts) through the CGA program are valuable in his jobs as an accountant, a politician and as a business owner. In Gagliano's own words, his job as a politician calls for "tact, good decision-making skills, an ability to reason and the tendency to check and double-check something."
Reflection
I really do think that the skills developed in obtaining an accounting designation such as the CGA or CA etc. are valuable in accounting, business and other jobs outside of business. There is some irony in the situation that Gagliano is in and how the text portrays him as a good example of the value of accounting skills. It also illustrates that we can teach skills, we can discuss ethics but we can’t teach someone to be ethical. Is Gagliano really innocent – personally, I don’t believe he is. As a further thought, I think the authors of the book realized this contradiction and have since removed his career profile from the latest edition of the text. I guess that's what happens when we use a 15 year old book...
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