The International Accounting Standards Board (IASB) has issued COVID-19-Related Rent Concessions beyond 30 June 2021 (Amendment to IFRS 16), an extension to the practical expedient period in the amendments to IFRS 16 Leases made last year.

This extension is for one year, so the application period now extends until June 30, 2022.

In May 2020, the IASB published an amendment COVID-19-Related Rent Concessions (amendment to IFRS 16) (the 2020 amendment). The 2020 amendment added a practical expedient to IFRS 16 which provides relief for lessees in assessing whether specific COVID-19 rent concessions are considered to be lease modifications. Instead, if this practical expedient is applied, these rent concessions are treated as if they are not lease modifications.

In light of the impact the COVID-19 pandemic has had on business activity across the world, and response from feedback received from stakeholders, the IASB decided to extend this relief for one year to provide relief for recent concessions in relation to COVID-19 that reduce payments up until June 30, 2022.

The extension is effective for annual reporting periods beginning on or after April 1, 2021.

Our thoughts

We welcome this latest amendment to extend the scope and application date of the relief for another year. The COVID-19 pandemic is still very prevalent around the world and it is, therefore, reasonable that lessors would still be providing rent concessions to lessees for lease payments beyond June 30, 2021.

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Eric Dufour
Vice-President, Partner | FCPA | Management consulting

Updated on February 19, 2024

Sound governance is essential for your business’ sustainability and growth. What principles should guide you?

Good governance is key to the success of any organization, regardless of its size, industry or service offer. Since effective oversight affects all corporate processes, practices and structures, it can help you meet your financial, strategic and operational goals.

Taking a proactive approach

You may need to review your governance periodically to make sure it’s properly aligned with your business’ current reality. Because of the post-pandemic and inflationary context, this need has become more critical than ever. Business models have changed and your objectives probably aren’t the same as they were before the pandemic.

This isn’t optional. Businesses that remain static in the current context will fall behind their competitors and find themselves out of step with the expectations of their customers and employees.

By proactively reviewing your corporate governance, you can:

  • Manage risks and reduce blind spots;
  • Establish a healthy balance sheet and get financing if you need it;
  • Anticipate future developments and prepare to respond quickly;
  • Innovate and develop your business;
  • Retain workers and attract new talent.

Applying the principles of good governance

To be effective, your governance structures need to reflect your organization’s strategic plan as well as its values, mission, vision and succession plan. Here are some key principles to follow:

  • Review your game plan regularly;
  • Put the right people in the right positions;
  • Assign responsibilities wisely;
  • Get an outside perspective;
  • Increase diversity on your board;
  • Embrace human leadership.

Review your game plan regularly

It’s important to review your company’s action plan, business strategies and priorities on a regular basis.

Your organization needs to turn a critical eye on itself. Questioning your practices is the only way to evolve and adapt to new market realities.

Put the right people in the right positions

Make sure each position is filled by the right person and then make changes as needed to reach your strategic targets.

Assign responsibilities wisely

Be judicious when assigning duties to the various members of your management team. The head of the company shouldn’t be left stranded, shouldering all the responsibility.

You definitely need to have good chemistry between the board chair and the CEO.

Get an outside perspective

Even the smallest companies should look for external board members who bring complementary skills to the table, especially in the area of technology. With fresh ideas and an outsider’s perspective, they can shake things up and spur innovation.

Increase diversity on your board

Boards should be more inclusive. Aim for diversity in age, gender, experience, and cultural and social background. Diversity is important because it leads to productive discussions and can help organizations meet their environmental, social and governance (ESG) criteria.

Embrace human leadership

Tomorrow’s leaders will need to be more approachable, people-centric and able to communicate more effectively with stakeholders, especially employees.

With this in mind, you want people with strong interpersonal skills and emotional intelligence to sit on your board. Directors with these qualities will be better able to anticipate the impact of key decisions.

Get help with your governance review

Our firm has developed a comprehensive approach called the ABCDs of Good Governance to help you establish or review your governance structure.

The government offers a number of financial assistance programs to support organizational change and procedural reviews. Up to 50% of the associated costs are covered.

Remember, investing in your corporate governance isn’t just profitable, it’s essential for your business’ survival and growth.

Contact our experts today for advice on setting up a sound governance structure.

07 Apr 2021  |  Written by :

Éric Dufour is a management consulting expert at Raymond Chabot Grant Thornton.

See the profile

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The Grant Thornton International IFRS team has published three Insights into IFRS 3:

  • Identifying a business combination within the scope of IFRS 3;
  • Identifying the acquirer;
  • Identifying the acquisition date.

Mergers and acquisitions (business combinations) can have a fundamental impact on the acquirer’s operations, resources and strategies. For most entities, such transactions are infrequent and each is unique. IFRS 3 Business Combinations contains the requirements for these transactions, which are challenging in practice. The standard itself has been in place for more than ten years now and has undergone a post-implementation review by the IASB. It is one of the most referred to standards currently issued.

The Insights into IFRS 3 series summarizes the key areas of the standard, highlighting aspects that are more difficult to interpret and revisiting the most relevant features that could impact your business.

After issuing Insights into IFRS 3 – The acquisition method at a glance, the Grant Thornton International IFRS team released three Insights into IFRS 3 which set out the steps when identifying whether business combinations are within the scope of IFRS 3, identifying the acquirer and identifying the date of the business combination in accordance with IFRS 3.

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Updated on February 11, 2022

Your business could benefit from tax measures, such as SR&ED tax credits, for its innovation projects. Do you know all of these measures?

Any organisation, whatever its industry, that is involved in manufacturing and processing or that has technological innovation projects may qualify for specific tax incentives.

These credits are not exclusively for plants, factories or manufactures. For example, under the Scientific Research and Experimental Development Tax Incentive Program, the government encourages organisations of all sizes and in all industries to put innovative research and development ideas into application.

Tax measures: keep an eye on deadlines

Your activities or projects may be eligible for some of these measures. However, there are deadlines to respect in order to claim these tax incentives or modify previous years’ tax returns if the measures have not all been claimed.

Here are the key points that every organisation should know in order to maximize its tax position in terms of its manufacturing and processing activities or innovation investments, regardless of the industry.

Additional deduction for a manufacturing SME’s transportation costs

A business only needs to carry out a certain proportion of manufacturing and processing activities to benefit from this additional deduction. Furthermore, it does not have to incur transportation or delivery expenses to take advantage of it.

Investment and innovation tax credit

Certain assets acquired for use in manufacturing and processing activities are eligible for a provincial investment tax credit, a tax subsidy that reduces the acquisition cost of these assets.

At the provincial level, the rate of this tax credit may vary depending on the RCM where the asset is used. The 2021-2022 Québec budget has enhanced this credit by doubling the rates for investments made until December 31, 2022.

At the federal level, there is a similar investment tax credit and the only eligible regions in Québec are the Bas-Saint-Laurent, Gaspésie and Îles-de-la-Madeleine.

Accelerated and additional capital cost allowance

Certain assets acquired for use in manufacturing and processing activities qualify for a total capital cost allowance. For Quebec purposes, these assets also qualify for an additional 30% capital cost allowance in the following year.

Tax credit to support employment in Québec’s maritime regions

An enterprise that has certain manufacturing and processing activities in the Bas-Saint-Laurent, Côte-Nord, Gaspésie and Îles-de-la-Madeleine regions may benefit from a tax credit on the salary paid to certain employees, that is, a subsidy that reduces the payroll cost.

Reduced employer contribution

Enterprises in the manufacturing sector may be entitled to a reduced Health Services Fund (HSF) contribution rate.

Scientific research and experimental development (SR&ED)

A business that carries out manufacturing and processing activities is included in the main industries that are likely to be able to use these tax incentives.

Businesses that are searching for knowledge or know-how to create new materials, devices, products or processes or improve existing ones or are looking for new scientific or technological knowledge may be entitled to SR&ED tax incentives.

The two main benefits of SR&ED tax incentives are:

  1. Possibility of deducting your SR&ED expenses over several years;
  2. Obtaining the investment tax credit (ITC) for SR&ED and using it to reduce your income tax payable (in some cases, the Canada Revenue Agency (CRA) may refund remaining ITCs).

Are you taking full advantage of the special tax features of your manufacturing and processing activities and innovation projects? Our team of tax experts can help you make the most of them. Don’t hesitate to call on them; they have mastered the complex tax provisions in this field. Their strategic location also means they are aware of regional characteristics.

Your success is important to us. We make our knowledge and expertise available for your business.

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