P3 Task Force Established
The CCA Board of Directors has called for the establishment of a Task Force on Public-Private Partnerships under the aegis of the Standard Practices Committee. The creation of the Task Force has been prompted in part by the following:
· The increasing trend by Canadian governments to use the P3 approach;
· The need to educate the CCA membership, particularly SMEs as to the different contractual arrangements, risks, responsibilities, and practices associated with P3s;
· The need to ensure the opportunity and ability for Canadian firms to participate in P3 projects and to ensure an on-going Canadian capacity to meet the demand for this project delivery method;
· To ensure that Canadian governments opt for the P3 method of delivery when it is the best option.
The Task Force will have representation from each of the four CCA sectoral Councils and plans on meeting over the summer months.
Coalition Established to Enhance College Training Infrastructure
CCA working with the Association of Canadian Community Colleges (ACCC) hosted a special meeting in
New Standard Subcontract Form and Subcontract Bidding Guide Approved
The CCA Board has approved for publication an updated version of CCA Nº 1 the Standard Stipulated Price Subcontract Form to keep pace with the recent changes to CCDC2.
The Board also approved the publication of a brand new Subcontract Bidding Guide to be known as CCA 51 Guide to Calling Bids and Awarding Subcontracts. The Guide addresses best practices involved in the procurement of subcontractors where price is the primary determinant for selection. It is intended to foster improved mutual cooperation and productivity between prime contractors and subcontractors.
CCA to Initiate New Partnership Program this Year
The CCA Board of Directors approved the new CCA Partnership Program commencing this year. Under this Program, CCA will fund on a 50-50 basis initiatives proposed by its Member Associations that have a national benefit. The Board agreed to allocate up to $100,000 from the CCA’s current Budget for this purpose.
NEW CCA Construction Accounting Guide Approved
The CCA Finance Committee’s new CCA guide entitled Construction Accounting Best Practices: Revenue Recognition Guide has been approved for publication by the CCA Board of Directors. CCA will be making this new guide available soon as a free download from its website for CCA members. In addition, it is offering CCA Integrated Member Associations with the option to also host the Guide on their websites provided it is accessible by their members only.
As the title suggests, this Guide focuses on issues related to the recognition of revenue providing guidance on when to use the percentage of completion and the completed contract methods of revenue recognition. It also illustrates by example the effect both of these methods can have on a company’s bottom line.
The Guide also addresses current and future income taxes as they relate to holdbacks on construction contracts and other temporary differences resulting from amortizing assets for book purposes at different rates than the capital cost allowance rates stipulated by the Canada Revenue Agency (“CRA”). It also provides guidance on the special GST/HST timing rules that apply to the construction industry and introduces contractors to the new accounting rules surrounding “financial instruments”, which become mandatory for private companies in the first fiscal year beginning on or after
Some Relief at Last on the Vehicle Benefit Front!
For several years, CCA has been seeking some tax relief for construction employees using company motor vehicles (i.e. non-automobiles) to travel to and from home to construction work sites. A recent Tax Opinion issued by Canada Revenue Agency (CRA) would appear to have opened up the possibility for a new CRA administrative approach that would apply a significantly reduced value to the personal, taxable benefit in certain circumstances, (e.g. 24 cents per kilometre as opposed to the current 52 cents prescribed by Regulation). CCA is in close consultation with the CRA regarding the development of a new CRA administrative policy based upon this Opinion.
The Opinion essentially states that the CRA will now accept the reduced benefit calculation where ALL of the following conditions have been met:
1. The employer prohibits any other personal use of the motor vehicle (other than commuting between home and work); and
2. The employer has bona fide business reasons for requiring the employee to take the vehicle home at night, such as security concerns with respect to the employer's tools and equipment being left at the worksite or overnight at employer's premises, or the employee is on-call to respond to public emergencies and the vehicle is provided to improve response to emergencies; and
3. The motor vehicle is specifically suited to or designed for the employer's business or trade and is essential in a fundamental way for the performance of the employment duties.
It is important to note, however, that this Opinion currently does not apply to automobiles as defined by the Income Tax Act. For example, vehicles are considered automobiles by the Act where they have a seating capacity of more than the driver and two passengers (e.g., a pick-up or van with a “king” or extended cab) and in the year they are acquired are not used 90% or more of the time to transport goods, equipment, or passengers in the course of business.
CCA is continuing to press for further changes, including broader application of the foregoing.
Gold Seal Requirements Changing in 2009
As of
In addition to these a number of guideline changes were made in January 2008, including the following:
Gold Seal will undertake a thorough information program to bring potential candidates and Local Construction Associations up to speed on these changes.
CCA to Submit Report Under Federal Hours of Service Exemption Procedure
Following the release of Transport
Agreement Reached on Minimum Duration for “Substantial Machinery or Equipment”
CCA has learned that the CRA and the Non-Agreeing Provincial Governments (i.e. Alberta, Ontario and Quebec), have agreed on a minimum duration test for the presence of substantial machinery or equipment as a determinant in finding a taxpayer has a “permanent establishment” in a given province for the purposes of allocating provincial income and establishing provincial tax liability. Currently, the Income Tax Act, provides that the use of substantial machinery or equipment “at any time in a year” in a province will trigger provincial tax liability. CCA has been seeking clearer guidelines in this area, and in particular, ones defining specific and reasonable time periods.
The agreement provides that where a taxpayer uses substantial machinery or equipment in a province for 30 continuous days on a particular site or project or 90 days cumulative in a 12-month period, the taxpayer will be deemed to have a permanent establishment for provincial income tax purposes. However, where the use of such machinery or equipment is less than the minimum duration, the taxpayer will have the option to elect to have a permanent establishment in that jurisdiction without fear of reassessment from another jurisdiction.
CCA to Partner with EDC on Supply Chain Research Project
The CCA Board has agreed to partner with Export Development Canada (EDC) in a “supply chain” research project intended to identify and document the various downstream and upstream suppliers and participants on which the construction industry depends in order to provide a competitive and value-added product or services. The EDC has completed similar research projects on other industries.
New CCA Joint Venture Guide Approved
The CCA Board endorsed the release of a new guide to be called CCA 52 Joint Venture Guide. The Guide defines a joint venture, its purpose and effect, while also providing a checklist of commercial considerations and other pertinent matters.
CCA Website Has New Look
CCA launched its new, revamped website at the June Board meeting in
Board Approves Two New CCA Awards
The CCA Board has approved the creation of a new International Business Award to honour notable initiatives or achievements by construction firms, associations or individuals in the area of international business in the Canadian construction industry. It has also approved the establishment of a new CCA award to recognize outstanding contribution made to advancing the interests of the CCA Manufacturers, Suppliers and Services Council and/or that sector in general.
Appointments to Outside Agencies/Committees
Barry Scroggs of Farmer Construction Ltd. in