To guard against phishing and other cyber-attacks, SMEs need to invest in IT security. Is your business prepared?

Cybersecurity has become a major issue in today’s markets. The growth of your business, and perhaps even its survival, depend on it, because a cyber-attack can have serious consequences. Beyond the ransom payment, it can cause, among others:

  • the shutdown of the company’s activities;
  • litigation;
  • loss of trust with clients and partners.

No organization is safe: 71% of Canadian businesses were victim to a cyber-attack that had an impact on their organization in 2019. This statistic only includes businesses that reported an incident.

Protect yourself from phishing and data theft

Did you know that hackers are often present for more than six months, without your knowledge, before triggering more serious attacks?

Many SMEs are not sufficiently protected against cyber-attacks. Cybercriminals target them, in part because they act as a gateway to the large companies they do business with.

SMEs can fall victim to several types of incidents. Through phishing, hackers can:

  • gain access and break into the computer network in order to steal data;
  • access e-mail accounts (imagine the consequences if a cyber hacker manages to send a message to your customers from your e-mail address asking them to pay you for a new bank account);
  • disable corporate defence systems;
  • affect data backup systems.

Cybersecurity RCGT

Ransomware, a new form of fraud

Ransomware is another common type of threat, especially since the emergence of cryptocurrency, which now allows cybercriminals to monetize their actions in an undetectable way.

In the classic scenario, cybercriminals break into a company’s computer system and paralyze it by encrypting files. They then demand a ransom to unlock the system but, in the meantime, the company may have to shut down all operations.

Moreover, there is no guarantee that the hackers won’t start their game again a few days later or that they haven’t deleted all the company’s strategic data.

Secure your data to stay competitive

Does your company meet the minimum cybersecurity requirements that must now be included in calls for tenders? If not, many contracts are in danger of slipping through your fingers.

Given the frequency and scale of cyber-attacks, large corporations and public organizations want to ensure that their suppliers have information security controls in place and that they comply with increasingly stringent industry standards.

In order to remain competitive and do business with large companies and organizations, including governments, it is essential that your company include cybersecurity measures in its strategy.

Prepare a plan to prevent security incidents

A business interruption due to a cyber-attack could prove costly to your business. To protect yourself from the consequences, it is important to prepare an adequate incident response and business continuity plan. Being prepared for any eventuality will make a huge difference in the event of an attack. As the saying goes, an ounce of prevention is worth a pound of cure.

Prevent financial losses

The financial losses associated with the partial or total suspension of your activities can be very high. In addition to the direct costs (resources devoted to responding to incidents, lost data and contracts, ransom payments), you may also have to pay fines, particularly if you violate the Personal Information Protection and Electronic Documents Act.

Remain vigilant and invest upstream rather than incurring excessive expenses.

Maintain the bond of trust with your customers and partners

Of course, the theft of personal information and sending of false messages to customers and business partners as a result of e-mail account hacking are extremely damaging to a company’s credibility.

Did you know that 81% of Canadians would never do business with an organization if their personal data had been compromised during a cyber-attack?

It is all the more important to preserve your reputation by properly equipping your company against cyber-attacks and other computer security incidents.

Avoid costly lawsuits

SMEs that are victims of a cyber-attack are exposed to lawsuits and litigation from their customers and business partners. This could be the case, for example, following the theft of personal information or if a paralyzed SME can no longer honour its contracts.

Establish a computer incident response plan to preserve and document evidence to defend yourself in the event of a lawsuit.

Conserve your resources to take advantage of business opportunities

An SME that has to work hard to recover from a cyber-attack may postpone or even cancel an important project because it no longer has the time or resources to carry it out.

Although the threats are numerous and serious, SMEs can protect themselves adequately by calling on specialized resources that will provide them with state-of-the-art solutions and tailor-made strategies. Do you have questions about this? Please contact us for more information.

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It may seem easy to do your own bookkeeping. Yet a lack of knowledge can lead to costly mistakes.

Bookkeeping, a difficult art to master

Bookkeeping can become complex and requires that you master certain subtleties. Omissions or poor bookkeeping could have unfortunate consequences.

It is therefore important to call on an expert for your bookkeeping needs. He will make sure you get all the benefits to which you are entitled while ensuring that you comply with all the tax rules in effect.

Your risk exposure

It is important to meet tax and source deduction filing deadlines. Poor planning could result in penalties, interest payments, or a note in the company’s file. Similarly, accounting for ineligible expenses may also expose you to an audit. Not knowing how or what to answer in the event of an audit could make your situation worse in the eyes of different government levels.

Your benefits

On the other hand, incomplete bookkeeping knowledge could cause you to miss certain credits or deductions to which you are entitled, depending on your activity sector. You could also forget to account for certain expenses to which you are entitled, or account for inputs incorrectly (taxes receivable) and thus declare too much or too little income.

For peace of mind, call on an expert for your bookkeeping.

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When it comes to diversified agri-food activities, it is to the entrepreneur’s benefit to undertake an in-depth tax analysis and optimize the business’s structure.

The agri-food sector is distinctive in that agriculture and food processing activities overlap. This makes the industry interesting, but also adds numerous tax considerations.

Tax credits and benefits

The agricultural sector enjoys enviable advantages from a tax point of view. For example, holding eligible farm property and/or corporate shares that qualify as eligible farm property can result in a $1,000,000 capital gains deduction when the business is sold.

In addition, an exclusive and specific provision for this sector is the possibility of transferring the property to family successors with no tax impact. However, compliance with certain conditions is essential in order to avail oneself of these benefits. It is therefore important not to “contaminate” an agricultural activity with non-agricultural operations if the ultimate objective is to take advantage of these tax incentives.

On the other hand, there are also advantages available for manufacturing and processing activities, or M&P as they are often called, such as certain investment tax credits or favourable capital cost allowance rates.

The importance of an appropriate structure

As a general rule, it can be more complicated to benefit from the tax advantages inherent to both activity sectors (agricultural and non-agricultural) if they are grouped under the same entity, hence the importance of discussing with a tax specialist who will be able to help you plan an appropriate and customized structure for your business and projects.

Here are a few key moments in the life of an agri-food entrepreneur where it is essential to consult the right specialists:

Business start-up

Proper guidance and planning will help you determine the most appropriate structure for your business (sole proprietorship, corporation, partnership, trust).

Activity or product diversification

Experts will be able to accompany you in your plans to diversify your activities or products. For example, you own an orchard and want to start producing cider or, conversely, you produce vodka and want to get into corn production as well.

Integrating the various activities

You can choose vertical integration (from cultivating to processing, marketing, distributing and selling your product) or horizontal integration (through the development of services related to your operation, such as organizing weddings and tourism activities at your vineyard).

Growth by acquisition or partnership

Experts can also assist you acquire a competitor, integrate shareholders, develop partnerships, expand or purchase buildings, land or equipment.

Succession planning

Think about succession planning, a possible divorce or estate planning as well.

It is in your best interest to be well supported through the maze of a sometimes complex tax system. Contact our experts to optimize your business’s situation.

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The Grant Thornton International IFRS team has published the 2020 edition of Navigating the changes to International Financial Reporting Standards: A briefing for Chief Financial Officers.

This publication has been designed to provide chief financial officers high-level awareness of the recent changes that will affect companies’ financial reporting in the future.

This publication covers both new standards and interpretations that have already been issued, and new amendments made to existing ones, giving brief descriptions of each.

Consult the document below.