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Layoff Watch ’24: The Canadian Version of the AICPA Cuts One Fifth of Its Workforce

downtown buildings edited to look like Canadian maple leaf in the sky

TLDR: CPA Canada is laying off 20 percent of its workforce because CPA Ontario and CPA Quebec are exiting the organization and taking their many members with them.

Normally a story like this wouldn’t be of interest to our predominantly American readership but it’s worth reporting because the circumstances are unique and come down to infighting among the provincial and national bodies overseeing professional licensure. With our own state vs. national drama happening closer to home, we should pay attention.

Here’s the deal. Last year, CPA Ontario and CPA Quebec decided they were going to split off from the CPA Canada national body. In their break-up note, CPA Ontario said:

“The size and complexity of Ontario’s economy is unique in Canada. The critical role CPAs play in safeguarding it demands responsive, streamlined and efficient management of their professional body. This decision will enable CPA Ontario to better protect the public, serve members and students, and advance the profession by being more nimble and innovative.”

Per the province’s rebellious accounting body, Ontario hosts Canada’s largest capital markets, financial institutions and pension funds, along with a large technology sector.

CPA Ontario went on to criticize the national body harder in an FAQ explaining the decision to go their own way in these literal bullet points (imagine a BANG sound as you read each one):

  • CPA Canada’s technological failures that led to the catastrophic 2019 CFE writing, as well as its response and review, led to CPA Ontario and CPA Quebec commissioning our own independent third-party review of the event so that the core issues could actually be identified and addressed.
  • In a profession that prizes transparency as one of its core tenets, there continues to be concerns regarding CPA Canada’s financial transparency surrounding the education programs. We have tried continuously to get better financial information – including trying to use our contractual audit rights – but were continuously rebuffed. It appears to us that CPA Canada did not want to support a process that would result in transparency.
  • CPA Canada challenged our legislative role as the regulator and voice of the profession in Ontario. Without consulting us or any of the provinces, it registered a trademark for a designation that would impact your CPA designation—the Global CPA or GCPA. Only after months of pressure from us did CPA Canada finally agree to withdraw that registration. It is still not clear to us what they intended to do with that designation.

CFE = their CPA exam. The 2019 CFE writing disaster is detailed in a letter from a collective of exam-takers who said it was “likened to being held hostage” while others took to Reddit to fling around words like “disappointing,” “horrifying,” and “disastrous.” Financial Post‘s headline was perhaps the most scathing review of all: ‘Fyre Festival for accountants’: CPA Canada takes heat after national exams plagued by glitches. Certainly better than ours: Let’s Talk About How CPA Canada Totally F*cked Up Last Week’s CFE.

In November, CPA Ontario announced that they, Quebec, and the national body had come to an agreement that CPA Canada will continue to develop the curriculum and examinations for the Preparatory courses (PREP) in Ontario, and the CPA Professional Education Program (PEP) and Common Final Examination (CFE) in Ontario and Quebec. L’Ordre des CPA du Québec and CPA Ontario will continue to deliver all CPA education courses, programs, and exams in their respective jurisdictions.

OK, you’re caught up. What’s happening now is CPA Canada slashing 20 percent of their workforce of 400 people due in large part to losing those two provinces and the many, many chartered accountants in them. The Globe and Mail reports:

Last week, The Chartered Professional Accountants of Canada’s chief executive officer, Pamela Steer, told employees in an internal memo the organization is “in a challenging operating environment” amid the impending withdrawals of CPA Ontario and CPA Quebec. The pullout, she said, triggered the CPA Canada leadership team to conduct a strategic review of the organization.

“After sober reflection on future needs, it became clear that organizational changes are needed to ensure the long-term success of a CPA Canada that best serves members and the profession,” Ms. Steer wrote in the memo, which The Globe and Mail obtained. “Unfortunately, this means making difficult decisions that will impact 20 per cent of our workforce.”

Between them, CPA Ontario and CPA Quebec make up about 60 percent of CPA Canada’s 220,000 members. The Globe math says that’s about $40 million in dues. After Ontario and Quebec exit CPA Canada in December 2024, members will no longer have to pay CPA Canada dues along with their provincial ones (currently $980 CAD + applicable taxes in Ontario, $400 of which goes to CPA Canada).

Per Canadian Accountant, CPA Canada has had a rough couple of years, fiscally speaking:

According to its five most recent annual reports, overall revenue at CPA Canada has hovered around $130m, with member fees generating about $70m, whereas expenses have increased from $122m to $133m. The organization has posted two deficits within the past five years. CPA Canada posted a particularly large deficit of $11.25 million in the most recent fiscal year, which ended March 31, 2023.

The deficit included $8.77-million in spending on “strategic initiatives.” CPA Canada withdrew the spending from a $21-million fund “internally restricted for strategic initiatives,” which now sits at $12.3-million.

The employees losing their jobs are “good people who have worked hard on behalf of our profession and CPAs across Canada,” said CPA Canada CEO Pamela Steer in a statement to The Globe. She added that 89 percent of their members “reaffirmed the need for a strong national accounting body” in a poll.

CPA Canada cuts staff in advance of Ontario, Quebec exit [The Globe and Mail]

One thought on “Layoff Watch ’24: The Canadian Version of the AICPA Cuts One Fifth of Its Workforce

  1. This is a complete f-up on both sides. What isn’t called out and should be is that CPA Ontario didn’t have any mandate form members to withdraw nor were members allowed to vote on it.

    No one has ever really explained what CPA Canada was doing with all the dues collected beyond some of the cringiest television advertising ever broadcast.

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