CGA Needs a Partner to Survive

mikey – I told you, TAK, ca in hk & associates do not know why CICA needs desperately to merge. The explanations above are not the real reasons.

But folks, CGA is walking way because its leadership realized this is the best strategic decision to make. CGA is in a very good position in Canada and does not need to merge at this moment. CGA can wait and see what happens. The organization has excellent reputation in the marketplace and is growing fast. Its members are e xtremely happy and support any decision of their leadership.  

If the CPA project in Canada fails, CGA will be in an excellent position as the organization is not dying. In addition, there would be a possibility of merging with CMA in the future as they have good relationship and support of both members. If CICA is in trouble now, with a CGA/CMA merge, CICA would be in a worst position. 

If CPA Canada succeed, CGA could come back to the table any time in the future to join CPA Canada. However, CGA has a plan B. There would be an interesting alternative to compete with CPA Canada. GCA has close relationship with ACCA. They have mutual recognition agreement in place. ACCA is looking for opportunities to grow globally and would be interested in an alliance with CGA to penetrate in Canadian market. A joint venture with ACCA (like the joint venture between CIMA and AICPA creating the global organization CGMA) would give CGA leadership more autonomy to manage the operations in Canada instead of sharing power with CAs and CMAs. With an alliance with ACCA, CGA would be in a good position in the marketplace to compete with CPA Canada as CGA would become a global organization instead of a local organization as CPA Canada will be at least in the beginning.

Thus, from a CGA perspective there are no advantages to merge now. That is the reason why CGA is walking away. CGA can wait and decide later what is the best for the organization.

On the hand, CICA needs to merge at least with CMA to create CPA Canada. There are other very relevant reasons why CICA needs this merge but this is another discussion.

I have to admit it was easier presenting a case for the merger of all three accounting bodies than to recommend to CGA what to do after opting out of the merger. We (CGA) will be a disperse organization within Canada as Quebec has gone and others like Alberta may be part of the CPA.
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I am for a strong single Canadian brand. The other options are less desirable for CGA. ACCA is an international brand but it is not a made in Canada Brand. It will no different from having the Chartered Accountant brand, which is not a made in Canada; it is an import. I think we have to drop the historical appendages.
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Canada now has a national security regulator; similar to the SEC. Securities regulations was a provincial’s domain but it did not make any sense for investors and for policing the industry. The Gov’t did take the heat for setting up a national regulator, because it was the best-case scenario for Canada. I believe the regulation of accounting should be the same. I am not recommending government action but just saying we should be aware of the negative impact of a fragmented accounting regulation.
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Notwithstanding, whatever our CGA leaderships do, I am fully supportive of them. It is very easy to criticize anonymously. Our leaders are good people trying to do their best, while at the same time trying to balance the views of their entire member.
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The organization that is left out of the merger will find itself in a tight spot. It does not matter on what side of the debate you are. The “long-term” survival of your association will be threatened. CICA leadership was fully aware of this. This is why they invited themselves to the merger. The same rationale why CGA returned to the talks.

Perhaps we should have called ourselves Certified Chartered Managment Accounts to make sure that no one else can use their designation in Canada.
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olkcga, I like many of your posts, but note that most of the CICA board members are working for CA firms or closely affiiated with them. Therefore, they represent the veiws of a very small percentage of CAs. Furthermore, it sounds like many people at the CICA don’t necessarily support the merger…but the board does. So saying that the CICA supports this merger is analagous to saying that the Big4 firms support the merger when most of the CAs working for them do not support the merger.
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As for the ACCAs, I don’t think that they should use their designation in Canada because of the confusion it would cause, but we should not block them out. We should allow them to do a portion of the CGA/CMA/CA process so that they can get a Canadian designation. As an example, if they want their CA, they should prove that they have similar public accounting exerience and passed the UFE and become a CA. If not, they should try for another Canadian accounting designation.
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There shouldn’t be any rule saying that ACCAs can only align with one of the Canadian designations. If they affiliated with all 3, then it shouldn’t be a problem. If a CGA got their ACCA and then wanted to get their CA through an MOU, then I would be fine if again they gained the experience equivalent to a CA and wrote the UFE.

harj – I think everyone would appreciate it if you would back up your comments with either facts or opinions. But making unsubstantiated comments that contradict statements that have already been supported by facts just annoys everyone, including those who agree with you on the merger issue.
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It shouldn’t be necessary, but I’ll repeat a portion of my post #11958
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“[the CICA has] a balance sheet that shows $45 million in current assets and investments against $20 million in total liabilities (of which $10 million is deferred revenues).”
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If you want to argue that net available cash and investments of $35 million isn’t a lot, then please make that argument. But otherwise you just sound like you would if you we’re making posts saying that the sky isn’t blue.
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And note that the net available cash and investments in hand is greater than the CICA’s total annual membership dues ($30.3 million in fiscal ’11).

harj – you do yourself and those on your side a disservice by acting like you’re pretending certain factual information doesn’t exist.
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If you were to make an argument that $35 million in cash, other working capital and investments is not much (and explain why), then we could agree that we have conflicting opinions. However, that’s not the argument you’re making. I can only conclude that you’re arguing that the CICA’s fiscal 2011 financial statements did not reflect “$45 million in current assets and investments against $20 million in total liabilities (of which $10 million is deferred revenues)”. But you are wrong. That is exactly what those financial statements show.
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Think how many readers’ time you’re now wasting as they now feel obligated to determine whether or not I’m right.
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Here’s the link, everyone. Scroll down to page 31.
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http://www.cica.ca/about-cica/annual-reports/item56290.pdf

Tak your post at 11999: You are not able to ascertain liquidity at note #4. What gives?

TAK: You wrote “Can we agree not to play”; I agree. Don’t forget that there is a reason why the investments are not in current assets and neither of us know whether they are already pledged. However your case is strong in the defense of their liquidity and potential liquidity. CICA can increase fees very slightly and make a big difference and then reduce them to previous levels. Liquidity is not an issue for CICA. I wonder what the new financial statements will look like. You’re right….let’s not play with this….we know too little and it is not relevent.