http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001 Come back daily to see new posts and subscribe to our RSS feed. Radiant WebTools Looks like the public is getting up set about the amounts of salary the ED makes. After reading the article on the Hamilton Spectator website, read the commets.http://www.thespec.com/news/local/article/279162--siso-looks-for-new-leader Looks like the public is getting up set about the amounts of salary the ED makes. After reading the article on the Hamilton Spectator website, read the commets.http://www.thespec.com/news/local/article/279162--siso-looks-for-new-leader http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=17409 17409 Fri, 26 Nov 2010 09:28:53 +0000 With the arrest of the Executive Director I wonder if this is possibly the beginning of the end for SISO.How can any credibility be brought back to an organization who, on the outside, seemed to be doing great work yet on the inside be in turmoil.  I am sure in the coming months we will get the full story. With the arrest of the Executive Director I wonder if this is possibly the beginning of the end for SISO.How can any credibility be brought back to an organization who, on the outside, seemed to be doing great work yet on the inside be in turmoil.  I am sure in the coming months we will get the full story. http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16958 16958 Sat, 13 Nov 2010 11:35:11 +0000  Anyone with 'earned income' can contribute to an RRSP, up to and including the year that the contributor turns 71 years of age.  Contributions can be made to a spousal RRSP up to and including the year that the spouse or common-law partner turns 71 years of age.  This maximum age was increased from 69 to 71 by the 2007 Federal budget, giving people an additional two years to contribute.Generally, earned income includes a taxpayer's income (earned while the taxpayer was resident in Canada) from the following:-income from office or employment reported on a T4 slip (line 101 of the tax return)-other employment income (line 104) - this includes foreign employment income, which must be reported in Canadian dollars.       -Employment income on a US W-2 slip may have been reduced by contributions to a '401(k), 457 or 403(b) plan, US Medicare and Federal Insurance Contributions Act (FICA)'.  These amounts are not deductible on a Canadian tax return, and the gross employment income before these deductions would be included in earned income.-income (less loss) from a business carried on by the taxpayer, either alone or as a partner actively engaged in the business-income (less loss) from rental of real property-royalty income regarding a work or invention of which the taxpayer was the author or inventor-taxable support payments received-CPP or provincial disability pension income-amounts received under a supplementary unemployment benefit plan (not federal Employment Insurance)-lessdeductible support payments madeIf the taxpayer was not resident in Canada, but had income from employment performed or a business carried on in Canada, this may also constitute earned income, unless it was exempt from income tax in Canada due to a tax treaty with another country.Immigrants to Canada can get more information about Canadian income tax and RRSPs from the CRA publication T4055 - Newcomers to Canada.The maximum RRSP contribution amount that can be deducted is called the 'RRSP deduction limit', and is also known as 'contribution room' or 'deduction room'.  Your deduction limit is found on your Notice of Assessment or Notice of Reassessment from Canada Revenue Agency. Your 2010 limit would be on your 2009 Notice.  The deduction limit is calculated as:-18% of 'earned income' for the preceding year, to an annual maximum (see following table)-less the 'pension adjustment' amount, for participants in a Registered Pension Plan (RPP) or Deferred Profit Sharing Plan (DPSP)-less any 'past service pension adjustment', for participants in a RPP or DPSP-plus any 'past service pension adjustment' reversals-plus unused deduction room carried forward from the previous year  Anyone with 'earned income' can contribute to an RRSP, up to and including the year that the contributor turns 71 years of age.  Contributions can be made to a spousal RRSP up to and including the year that the spouse or common-law partner turns 71 years of age.  This maximum age was increased from 69 to 71 by the 2007 Federal budget, giving people an additional two years to contribute.Generally, earned income includes a taxpayer's income (earned while the taxpayer was resident in Canada) from the following:-income from office or employment reported on a T4 slip (line 101 of the tax return)-other employment income (line 104) - this includes foreign employment income, which must be reported in Canadian dollars.       -Employment income on a US W-2 slip may have been reduced by contributions to a '401(k), 457 or 403(b) plan, US Medicare and Federal Insurance Contributions Act (FICA)'.  These amounts are not deductible on a Canadian tax return, and the gross employment income before these deductions would be included in earned income.-income (less loss) from a business carried on by the taxpayer, either alone or as a partner actively engaged in the business-income (less loss) from rental of real property-royalty income regarding a work or invention of which the taxpayer was the author or inventor-taxable support payments received-CPP or provincial disability pension income-amounts received under a supplementary unemployment benefit plan (not federal Employment Insurance)-lessdeductible support payments madeIf the taxpayer was not resident in Canada, but had income from employment performed or a business carried on in Canada, this may also constitute earned income, unless it was exempt from income tax in Canada due to a tax treaty with another country.Immigrants to Canada can get more information about Canadian income tax and RRSPs from the CRA publication T4055 - Newcomers to Canada.The maximum RRSP contribution amount that can be deducted is called the 'RRSP deduction limit', and is also known as 'contribution room' or 'deduction room'.  Your deduction limit is found on your Notice of Assessment or Notice of Reassessment from Canada Revenue Agency. Your 2010 limit would be on your 2009 Notice.  The deduction limit is calculated as:-18% of 'earned income' for the preceding year, to an annual maximum (see following table)-less the 'pension adjustment' amount, for participants in a Registered Pension Plan (RPP) or Deferred Profit Sharing Plan (DPSP)-less any 'past service pension adjustment', for participants in a RPP or DPSP-plus any 'past service pension adjustment' reversals-plus unused deduction room carried forward from the previous year http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16736 16736 Sun, 7 Nov 2010 10:16:34 +0000  Just don't make the assumption that you are right or that you were advised by a friend because he does it. When it comes to the CRA they make the rules. Payback such as CPP, tax and EI could cripple your business if you are not careful. If it is consistent, you could face fraud charges. These are the questions that should be asked when tryingto understand the working relationship between employed and self-employed ­and whether the intent of the parties isreflected in the facts. These questions relate to: ■ the level of control the payer has over the worker; ■ whether or not the worker provides the tools andequipment; ■ whether the worker can subcontract the works or hireassistants; ■ the degree of financial risk taken by the worker; ■ the degree of responsibility for investment andmanagement held by the worker; ■ the worker's opportunity for profit; and ■ any other relevant factors, such as written contracts. Look at the answers separately and then together.Consider whether or not they reflect the statedintention.  When there is no common intent, the CRA will decideif the answers are more consistent with a contract of serviceor with a contract for services.  Indicators that the worker is an employee ■ The relationship is one of subordination. The payer willoften direct, scrutinize, and effectively control manyelements of how the work is performed. ■ The payer controls the worker with respect to both theresults of the work and the method used to do the work. ■ The payer determines and controls the method andamount of pay. Salary negotiations may still take place inan employer-employee relationship. ■ The worker requires permission to work for other payerswhile working for this payer. ■ Where the schedule is irregular, priority on the worker'stime is an indication of control over the worker. ■ The payer determines what jobs the worker will do. ■ The worker receives training or direction from the payeron how to do the work. The overall work environmentbetween the worker and the payer is one ofsubordination. ■ The payer chooses to listen to the worker's suggestionsbut has the final word. Indicators that the worker is a self-employed individual ■ A self-employed individual usually works independentlywithin a defined framework. ■ The worker does not have anyone overseeing them. ■ The worker is usually free to work when and for whomhe or she chooses and may provide his or her services todifferent payers at the same time. ■ The worker can accept or refuse work from the payer. ■ The working relationship between the payer and theworker does not present a degree of continuity, loyalty,security, subordination, or integration, all of which aregenerally associated with an employer-employee relationship. For full details go to:  http://www.cra-arc.gc.ca/E/pub/tg/rc4110/README.html If you need assistance or clarification feel free to give us a call on 905 870-1832.      Just don't make the assumption that you are right or that you were advised by a friend because he does it. When it comes to the CRA they make the rules. Payback such as CPP, tax and EI could cripple your business if you are not careful. If it is consistent, you could face fraud charges. These are the questions that should be asked when tryingto understand the working relationship between employed and self-employed ­and whether the intent of the parties isreflected in the facts. These questions relate to: ■ the level of control the payer has over the worker; ■ whether or not the worker provides the tools andequipment; ■ whether the worker can subcontract the works or hireassistants; ■ the degree of financial risk taken by the worker; ■ the degree of responsibility for investment andmanagement held by the worker; ■ the worker's opportunity for profit; and ■ any other relevant factors, such as written contracts. Look at the answers separately and then together.Consider whether or not they reflect the statedintention.  When there is no common intent, the CRA will decideif the answers are more consistent with a contract of serviceor with a contract for services.  Indicators that the worker is an employee ■ The relationship is one of subordination. The payer willoften direct, scrutinize, and effectively control manyelements of how the work is performed. ■ The payer controls the worker with respect to both theresults of the work and the method used to do the work. ■ The payer determines and controls the method andamount of pay. Salary negotiations may still take place inan employer-employee relationship. ■ The worker requires permission to work for other payerswhile working for this payer. ■ Where the schedule is irregular, priority on the worker'stime is an indication of control over the worker. ■ The payer determines what jobs the worker will do. ■ The worker receives training or direction from the payeron how to do the work. The overall work environmentbetween the worker and the payer is one ofsubordination. ■ The payer chooses to listen to the worker's suggestionsbut has the final word. Indicators that the worker is a self-employed individual ■ A self-employed individual usually works independentlywithin a defined framework. ■ The worker does not have anyone overseeing them. ■ The worker is usually free to work when and for whomhe or she chooses and may provide his or her services todifferent payers at the same time. ■ The worker can accept or refuse work from the payer. ■ The working relationship between the payer and theworker does not present a degree of continuity, loyalty,security, subordination, or integration, all of which aregenerally associated with an employer-employee relationship. For full details go to:  http://www.cra-arc.gc.ca/E/pub/tg/rc4110/README.html If you need assistance or clarification feel free to give us a call on 905 870-1832.     http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16725 16725 Sat, 6 Nov 2010 12:41:28 +0000 A revised Registered Charity Information Return has been developed in response to changes announced in the federal budget of March 4, 2010. This new Form T3010-1 will be used by charities with fiscal periods ending on or after December 1, 2010 and will be mailed to charities early in January 2011. A revised Registered Charity Information Return has been developed in response to changes announced in the federal budget of March 4, 2010. This new Form T3010-1 will be used by charities with fiscal periods ending on or after December 1, 2010 and will be mailed to charities early in January 2011. http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16648 16648 Thu, 4 Nov 2010 13:38:31 +0000 The 'Tax Free Zone' is also known as the Basic Personal Amount, a sum expressed in dollars but then multiplied by the lowest tax rate to arrive at the amount of tax savings that it represents. For example, the Federal BPA for 2010 is $10,382 and the lowest federal tax rate is 15%. Therefore the dollar value of the amount is 15% of $10,382 or $1557.75. This amount is deducted from any tax payable. Provincial basic personal amounts and tax rates vary. For example, in Nova Scotia the basic personal amount for 2010 is $8231. Multiplying that amount by the lowest provincial tax rate of 8.79% results in a tax reduction of $723.50. A resident of Nova Scotia, therefore, benefits from a combined federal and provincial tax reduction of $2281.25. Of course, since this is a non-refundable tax credit the reduction in taxes only applies if the taxpayer is assessed at least that much in the first place! The 'Tax Free Zone' is also known as the Basic Personal Amount, a sum expressed in dollars but then multiplied by the lowest tax rate to arrive at the amount of tax savings that it represents. For example, the Federal BPA for 2010 is $10,382 and the lowest federal tax rate is 15%. Therefore the dollar value of the amount is 15% of $10,382 or $1557.75. This amount is deducted from any tax payable. Provincial basic personal amounts and tax rates vary. For example, in Nova Scotia the basic personal amount for 2010 is $8231. Multiplying that amount by the lowest provincial tax rate of 8.79% results in a tax reduction of $723.50. A resident of Nova Scotia, therefore, benefits from a combined federal and provincial tax reduction of $2281.25. Of course, since this is a non-refundable tax credit the reduction in taxes only applies if the taxpayer is assessed at least that much in the first place! http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16318 16318 Sat, 23 Oct 2010 13:55:21 +0000 You have probably heard it said often that ' the Tone at the Top sets the pace for the organization.' It's just as true for nonprofits as it is for business. Take for example, the matter of clarity and transparency in the organization's reporting, internally and externally. If the Board Chair, the Board of Directors, and the ED are all pushing clarity and transparency, then that becomes the characteristic of the whole organization. And if that is not the case, then we tend to want to get away with whatever we can. So, let's say were dealing with the 'cost-to-raise-$1' standard of performance. There is two ways to represent that: one is to report more obvious costs of fundraising, such as website and internet costs, printing costs, travel, hotels and meals, etc. The other way is to include salaries and benefits of the professionals and volunteers involved in cultivation and solicitation at all levels. Case Study #1 George S., the ABC Charity's grant writer sees that the I Care Foundation wants to know the organization's overall cost-to-raise-$1 in the application that they are currently preparing for the Foundation. So George goes to his Manager of Development, Mary, for the information, and she goes to the Financial Officer, Frank, in turn. The first thing these three do is look at how the ED, Herb T. has talked about the organization's fundraising expenses in the past. The Annual Report had no listing for fundraising expenses at all. The narrative of that report spoke in glowing terms about the revenue's raised, but not a word about expenses. The expense chart didn't list fundraising expenses either; these were buried inside other, more general figures. Looking at the organization's audited financial statement, one could not discern that there was anything at all expended for fundraising. It all looks like program and administrative expense. Consequently, Mary and Frank work together to get just the figures for the upfront costs of special events and direct mail. They add in the special coffee-table brochure they made up last year and the cost of the planned giving newsletter and the corporate menu of benefits. Then they project those costs over all the money that the development department brought in: direct mail, special events, major gifts, planned gifts, grants and corporate contributions. The result is that they come up with a cost of about $0.05 to raise $1 and look really golden. The Foundation loves it! They get the grant because the foundation didn't look into the details of how that cost to raise $1 was determined. And the whole thing starts at the top of the organization because Herb has repeatedly shown that he doesn't want to tell the public how much is being spent on fundraising. Case Study #2 Melanie Z, the grant writer for Long-Established Charity Enterprises applies for the same grant from the I Care Foundation. She goes to her Manager of Development, Eugenia, for direction and she, in turn, goes to the Financial Officer, Marty for help. They sit down at a similar conference table to work this out. And they all are aware that the ED, Paula has repeatedly said that fundraising is an important, even a vital, part of the organization's work and has urged clarity and transparency in all reporting. In their annual report LECE has always separated fundraising expenses from other expenses and has included salaries and benefits there and noted them. In the pie-charts for revenue, we see fundraising revenue broken out, and we see a similar section of the expenses chart related to fundraising. Paula has set the standard that all fundraising is a 'profit center' and should be accounted that way. Consequently Melanie and Marty put together a cost of fundraising that comes out at about $0.35 to raise $1 and they put that on the application to the Foundation. And they don't get the grant, because someone at the Foundation failed to note the difference in reporting. What's the lesson? Well, what it's NOT is that Foundation is careless. The lesson is that leadership at the top determines how clarity and transparency in reporting is done throughout the organization and is reflected on things like grant applications. This in turn is reflected in how others outside view the organization. And, yes, if you hide the fundraising expenses your cost to raise $1 will look pretty good on paper and you'll get the grant. But is that what you want to do? Is it ethical? Is it the truth? The lesson ALSO is that, in this instance, you have to go to the Foundation staff and interpret and clarify how you have arrived at that cost-to-raise-$1 figure, and make sure they are aware that there are different ways nonprofits can represent this cost. You need to tell them that while you've put in ALL the expense, other nonprofits may tend to skimp on clarity and put in only what they have to in the way of fundraising expenses, and help these foundation staff see the difference between the two methods of calculating this important performance index. In the application itself, you can break out all the various components and then create a commentary paragraph to explain the situation and head off unwanted and unwarranted comparisons between the reporting methods of various nonprofits. Honesty is the best policy. And it starts at the top. AND it may take a relationship and some words of interpretation to help others understand the results of your honesty. So being honest, clear and transparent takes more work and is harder to do. But consider this, when you got into nonprofit work, was it ease of life you had in mind? Ask your ED that question. Acknowledgements: The above article was written by John Fike and clearly illustrates the need for Tone at the Top.    You have probably heard it said often that ' the Tone at the Top sets the pace for the organization.' It's just as true for nonprofits as it is for business. Take for example, the matter of clarity and transparency in the organization's reporting, internally and externally. If the Board Chair, the Board of Directors, and the ED are all pushing clarity and transparency, then that becomes the characteristic of the whole organization. And if that is not the case, then we tend to want to get away with whatever we can. So, let's say were dealing with the 'cost-to-raise-$1' standard of performance. There is two ways to represent that: one is to report more obvious costs of fundraising, such as website and internet costs, printing costs, travel, hotels and meals, etc. The other way is to include salaries and benefits of the professionals and volunteers involved in cultivation and solicitation at all levels. Case Study #1 George S., the ABC Charity's grant writer sees that the I Care Foundation wants to know the organization's overall cost-to-raise-$1 in the application that they are currently preparing for the Foundation. So George goes to his Manager of Development, Mary, for the information, and she goes to the Financial Officer, Frank, in turn. The first thing these three do is look at how the ED, Herb T. has talked about the organization's fundraising expenses in the past. The Annual Report had no listing for fundraising expenses at all. The narrative of that report spoke in glowing terms about the revenue's raised, but not a word about expenses. The expense chart didn't list fundraising expenses either; these were buried inside other, more general figures. Looking at the organization's audited financial statement, one could not discern that there was anything at all expended for fundraising. It all looks like program and administrative expense. Consequently, Mary and Frank work together to get just the figures for the upfront costs of special events and direct mail. They add in the special coffee-table brochure they made up last year and the cost of the planned giving newsletter and the corporate menu of benefits. Then they project those costs over all the money that the development department brought in: direct mail, special events, major gifts, planned gifts, grants and corporate contributions. The result is that they come up with a cost of about $0.05 to raise $1 and look really golden. The Foundation loves it! They get the grant because the foundation didn't look into the details of how that cost to raise $1 was determined. And the whole thing starts at the top of the organization because Herb has repeatedly shown that he doesn't want to tell the public how much is being spent on fundraising. Case Study #2 Melanie Z, the grant writer for Long-Established Charity Enterprises applies for the same grant from the I Care Foundation. She goes to her Manager of Development, Eugenia, for direction and she, in turn, goes to the Financial Officer, Marty for help. They sit down at a similar conference table to work this out. And they all are aware that the ED, Paula has repeatedly said that fundraising is an important, even a vital, part of the organization's work and has urged clarity and transparency in all reporting. In their annual report LECE has always separated fundraising expenses from other expenses and has included salaries and benefits there and noted them. In the pie-charts for revenue, we see fundraising revenue broken out, and we see a similar section of the expenses chart related to fundraising. Paula has set the standard that all fundraising is a 'profit center' and should be accounted that way. Consequently Melanie and Marty put together a cost of fundraising that comes out at about $0.35 to raise $1 and they put that on the application to the Foundation. And they don't get the grant, because someone at the Foundation failed to note the difference in reporting. What's the lesson? Well, what it's NOT is that Foundation is careless. The lesson is that leadership at the top determines how clarity and transparency in reporting is done throughout the organization and is reflected on things like grant applications. This in turn is reflected in how others outside view the organization. And, yes, if you hide the fundraising expenses your cost to raise $1 will look pretty good on paper and you'll get the grant. But is that what you want to do? Is it ethical? Is it the truth? The lesson ALSO is that, in this instance, you have to go to the Foundation staff and interpret and clarify how you have arrived at that cost-to-raise-$1 figure, and make sure they are aware that there are different ways nonprofits can represent this cost. You need to tell them that while you've put in ALL the expense, other nonprofits may tend to skimp on clarity and put in only what they have to in the way of fundraising expenses, and help these foundation staff see the difference between the two methods of calculating this important performance index. In the application itself, you can break out all the various components and then create a commentary paragraph to explain the situation and head off unwanted and unwarranted comparisons between the reporting methods of various nonprofits. Honesty is the best policy. And it starts at the top. AND it may take a relationship and some words of interpretation to help others understand the results of your honesty. So being honest, clear and transparent takes more work and is harder to do. But consider this, when you got into nonprofit work, was it ease of life you had in mind? Ask your ED that question. Acknowledgements: The above article was written by John Fike and clearly illustrates the need for Tone at the Top.    http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16185 16185 Mon, 18 Oct 2010 14:12:33 +0000 Have you experienced fraud within your organization? If so what did you experience? And what sector do you work in? i.e. Private, Public or Charitable/Nonprofit.My experience has shown me that fraud exists in all sectors. We will be presenting more information to this site as things move forward.ThanksJames   Have you experienced fraud within your organization? If so what did you experience? And what sector do you work in? i.e. Private, Public or Charitable/Nonprofit.My experience has shown me that fraud exists in all sectors. We will be presenting more information to this site as things move forward.ThanksJames   http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=16145 16145 Sat, 16 Oct 2010 11:25:45 +0000 The Canada Revenue Agency issued a release advising Canadians who plan to file their tax returns electronically, (or who do not submit information slips and receipts with their paper-filed return) to keep their tax records in case they are contacted by the Canada Revenue Agency (CRA). Once tax returns are filed, the CRA begins work to verify the income reported, as well as the credits and deductions claimed. These reviews are an important way the CRA ensures that Canadians are paying their taxes. Last year, the tax returns of approximately 2.7 million individuals were reviewed and an additional $700 million in taxes was assessed by the CRA. Some initial reviews of deductions and credits are conducted when returns are filed, and before taxpayers receive their Notice of Assessment. However, the majority of reviews take place later in the year, as the CRA works to verify the information on an individual's tax return and compare it with the information provided by other parties, such as an employer or a spouse or common-law partner. It is important that we work together to ensure that we have an audit proof tax return for 2010. For more information contact me on 905 870-1832 or info@finlay-associates.com The Canada Revenue Agency issued a release advising Canadians who plan to file their tax returns electronically, (or who do not submit information slips and receipts with their paper-filed return) to keep their tax records in case they are contacted by the Canada Revenue Agency (CRA). Once tax returns are filed, the CRA begins work to verify the income reported, as well as the credits and deductions claimed. These reviews are an important way the CRA ensures that Canadians are paying their taxes. Last year, the tax returns of approximately 2.7 million individuals were reviewed and an additional $700 million in taxes was assessed by the CRA. Some initial reviews of deductions and credits are conducted when returns are filed, and before taxpayers receive their Notice of Assessment. However, the majority of reviews take place later in the year, as the CRA works to verify the information on an individual's tax return and compare it with the information provided by other parties, such as an employer or a spouse or common-law partner. It is important that we work together to ensure that we have an audit proof tax return for 2010. For more information contact me on 905 870-1832 or info@finlay-associates.com http://www.finlay-associates.com/index.cfm?i=13291&mid=25&blogid=5001&comments=15806 15806 Fri, 8 Oct 2010 10:06:26 +0000