How Other Accountants Decrease Your Taxes

Willkommen to the second article on our series on terrible accountants and what you need to watch out for before they waste your money and time.
The aim is not to harm this Chartered Professional Accountant, this post is only there to give some background information on why clients make the upgrade to SwissBooks and wonder why they have to pay corporate income taxes for the FIRST time after more than 5 years in business. This should also save some unsuspecting business owners the same grief.

 Each time we discuss these details with the clients, they have no idea where his numbers come from.
1. A successful Edmonton Tint Shop The accountant wrote off more than $115, 000 of vehicle expenses in the year the client purchased a brand new Mercedes Benz ML63 for over $100,000. (If you have assets of a business (buildings, equipment, vehicles, etc.), you can ONLY claim a yearly deduction on the depreciation on the cost of these assets, also known as Capital Cost Allowance (CCA).  – As this is a vehicle, the rate is 30% and the first year rule applies = $100, 000 / 2 = $50,000 x 30% = $15,000 versus the $100,000+ that the accountant claimed)
2. A successful Edmonton Nail Salon – 
  • Strangely in the preceding year, the accountant reported sales which are $100,000 less than the debit/credit card terminal payments deposited in the bank.
  • There was also an unexplained $12,437 of vehicle expenses vs. our itemized $1,412 of vehicle expenses 
3. A corporation running 2 Award Winning Restaurants – 
  • Strangely there is nearly $50,000 of unexplained interest expense in the first preceding year, as well as abnormally high and unexplainable amounts in the second and third preceding tax years.
  • Same story with the repairs & maintenance account: we have nearly $11,000 of itemized entries mostly paid by the client credit card. In the 3 preceding years, the other accountant claimed there was more than $36,000, $38,000 and nearly $50,000 of repairs and maintenance.  
  • For EACH of the years in question, nearly $18,000 + $12,000 +$9,000 were claimed as professional fees when the ACTUAL amount paid for the 3 years is less than the accountant’s claim in 1 year
  • The accountant claimed GST on ALL of the food purchases for the restaurant when most foods do not have GST
  • This client pays for his restaurant’s expenses with his Mastercard but the accountant double claimed expenses by recording the expense off of receipts AND THEN also recorded the expense again by claiming the payment to the Mastercard as food purchases.

We have documented every time we tried to get working papers or the accounting ledger.  We look forward to the day he corrects his ways and takes his profession more seriously otherwise we will work with his professional accounting board to make sure he is punished.  (We have already successfully worked with CGA to score a fine against a different Edmonton CGA who was taking client’s cheques written to CRA and making them out to herself)

Make no mistake, these people are cowards and unsophisticated criminals, cheating their customers and the federal and provincial governments. Their designation means nothing when the client signs all this paperwork that they take whole responsibility of the reported numbers.

This is what we call inflating expenses to “minimize” your taxes: fake accomplishment will bite you in the end. Putting your customers at risk by reporting bogus numbers should put you in prison.

We feel sorry for this CPA (and his victims) but need to leave his name here to save time (so we do not have to explain the taxes his former clients need to pay and for his current and potential victims). It is truly a meaningless life when you charge material amounts of money and give nothing to the client in return other than a fake accomplishment, stealing from the government and eventually hurting the client when this catches up to them.  We fired one unsuccessful client who wanted us to help her cheat, only to get a professional courtesy letter from this same CPA, birds of the same feather flock together.

Welcome to SwissBooks
  1. 1. A full ledger is provided that reconciles to your bank and credit card statements showing each accounting entry in a clean layout.
  2. THUT is committed to further extending its market position.  The basis for this is an outstanding reputation.  Clear virtues and principles determine our daily thoughts and actions.
  3. High performance is the value that represents THUT.
  4. Striving for the highest quality, uncompromising customer service, and continuous further development create the common foundation on which we act when working together.

  5. Our credibility is based on the code.  It sustainably shapes our good name with the public, and therefore also our financial success.

  6. Our promise unequivocally says what we stand for and what we deliver.  We put ourselves in our customer’ shoes.
  7. The THUT tradition of commitment – as strong today as through the 19 generations of our state documented history – continue to place the interest of whom we serve before all other considerations.  Niklaus Thut, a Habsburg overlord and now a revered Swiss hero died defending his home.  Before he was killed, he ate the flag to prevent it falling into enemy hands. We will never dishonor our family reputation which stood for over 630 years for any ill-gotten short-term gains.  We will work with you to minimize your tax obligation, preserve and protect assets for future generations.  Accounting is beautiful a series of debits and credits that must balance.  There is no such thing as bad accounting- only bad accountants.

Like all people with no value, bad CPAs should be avoided at all costs.  Join my personal vendetta against all the bad CPAs in Canada that hide behind their designations or hide behind their high fees. Their customers automatically associate authority based on the high fees they charge. Bad CPAs: please start behaving or I will continue throwing punches as usual.

Upcoming topics for bad accountants:
  1. “Investing” under $500,000 in individual stocks: inefficient waste of time. If you could beat my index fund your time is worth more working on Wall-Street.
  2. Franchises: not worth pursuing unless you are the franchisor.

We can’t be responsible for other accountants irresponsibility.  Our responsibility comes from 10 years of delivery quality, completing files on time, servicing memorably and saving our customers’ far more money in taxes than any small price difference.

Share with someone that could use some advice in this post or save some taxes
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THUT data capture technology extracts data from bank, credit card, and online statements and allows for automatic bank reconciliation – this renders the CPA obsolete.
THUT uses artificial intelligence to locate and extract line item and tax summary data from receipts and exports it into a CSV file.
Cleansing algorithms allow it to extracts transactional data that is 100% accurate.
Send us your prior financials and we will prove to you how our value is unrivaled in Canada.