Subrogation

While I consider myself a pacifist, as a forensic accountant, I have been occasionally referred to as a fraud “fighter”. So, in the spirit of International Fraud Awareness Week (November 13 to 19, 2022), I would like to share some...

What is Waste to Energy? Waste to energy refers to the process of converting municipal solid waste (MSW), otherwise known as trash, into usable heat, electricity, or fuel. The three main MSW categories include: Biomass or biogenic (plant or animal...

We usually think of Hallowe’en when October rolls around; however, did you know that October is also cyber security awareness month? NetDiligence recently released the 12th iteration of their Cyber Claims Study. They analyzed approximately 7,500 cyber claims from period...

Our first technical briefing introduced the Oil & Gas value chain, divided into: i) upstream; ii) midstream; and iii) downstream.  Here is a recap, before we explore natural gas in more detail. Upstream: this involves the exploration and extraction of...

The sanctions imposed on Russia amid the Russia-Ukraine conflict have impacted global gas markets, particularly those in Europe.  Russia is the second largest producer of natural gas globally and used to supply about 40% of Europe's natural gas.  However, supplies...

While every catastrophe (“CAT event”) leaves a wake of destruction in its path, there are times when the financial impact is more widespread than the physical damage would indicate. Consider the following examples: Pandemic – 2020 The impact of COVID-19...

Swiss Re’s website sigma-explorer.com noted insured losses for 170 natural catastrophes and 105 man-made disasters in 2021 alone.[i] While almost all of these events resulted in property damage and loss of earnings for the affected businesses, some of those entities...

Bitcoin. Ethereum. Litecoin. Dogecoin. NFTs. While they may seem like buzzwords or fads, cryptocurrencies or digital assets are experiencing a similar adoption pattern to the internet in the 1990s. In 1995, 14% of U.S. adults had internet access; by 2000,...

All mines, no matter how vast or intricate, are ultimately temporary and will one day be depleted. When all valuable materials are extracted, or at least those that are cost-effective, mining operations will cease, and the mine will be decommissioned....

The Allianz Risk Barometer 2022 reported that natural catastrophes are now the third-highest global business risk, while climate change has moved into the sixth position. These rankings represent 25% and 17% increases from last year.[i] Furthermore, the increasing complexity of...

Environmental, Social and Governance (“ESG”) factors have gained increasing importance in recent years as society has become more aware of how corporate conduct affects stakeholders, the environment and humanity at large. From issues such as climate change to socially responsible...

Since 1978, American regulators and policymakers have looked to incentivize the investment and development of generating renewable energy. Individual states began enacting Renewable Portfolio Standards (RPS) to support this mission by requiring a specific percentage of a utility’s energy portfolio...

The use of depreciation, depletion and amortization (DD&A) is an accounting method that allows the cost of an asset to be recorded as an expense over a period of time in order to reflect the use and consumption of the...

During the course of matrimonial disputes, there are often situations where solicitors and their clients find it helpful to engage specialist consultants. Forensic accountants can assist at various stages of divorce proceedings, in order to provide a clearer picture of...

Quantifying the financial impact stemming from the failure of an already commissioned single stand-alone wind turbine generator presents challenges, but these challenges increase exponentially when the failure occurs at a wind farm under construction. Additional complexities surface to the extent...

As the Ukrainian conflict unfolds, Europe’s energy dependence on Russia becomes an increasingly critical bargaining tool. The economic sanctions imposed by some Western nations in response to Russia’s invasion appear to be increasingly directed against Russian oil and gas supplies...

When it comes to Business Interruption policies for Oil & Gas risks, there are different types of coverage available in the market, including Gross Profit, Gross Earnings, Specified Standing Charges etc. Common Policy Wordings Gross Profit equates to Turnover less...

Any well-run business starts with a plan, and a mining operation is no exception. Plans and budgeting or forecasting allow management to prepare for a future period, whether in the short-term or in the long run. Based on projections, management...

The Consumer Product Safety Commission (CPSC) in the US works with standards organisations, manufacturers, and companies to develop voluntary safety standards, warn the public of products that present significant risks to consumers and enforce mandatory standards or banning consumer products...

What started off as a comment by CEO Frans van Houten in global electronics giant, Philips Q1 Quarterly Report of 2021 issued on 26 April 2021 that “regretfully, we have identified a quality issue in a component that is used...

The use of Linear Program models is common in refining, and other industries, to optimise their activities by using an algorithm subject to a set of inputs, constraints, and relationships. This article discusses the LP models in more detail and...

If you read our article on the original decision for Foster and Aviva related to the deductibility of the Canadian Emergency Response Benefit (“CERB”) and Canadian Recovery Benefit (“CRB”)[1] from Income Replacement Benefits (“IRBs”), we concluded that further clarification was...

The main types of jet fuels used by airlines are Jet A-1, Jet A and Jet B. Jet A is mainly used in the United States, whereas Jet A-1 is commonly used outside the United States and Jet B is...

There has been concern over the impact or the proper treatment of the Canadian Emergency Response Benefit (“CERB”) and Canadian Recovery Benefit (“CRB”) in calculations of Income Replacement Benefits (“IRB’s”) under the Statutory Accident Benefits Schedule (“SABS”). A new LAT...

This past summer’s heatwaves and wildfires served for many as alarming reminders of climate change. Hotter summers, colder winters, and more hurricanes are amongst the symptoms of a changing global climate[1]. These climatic effects will impact different businesses in different...

Ore grade refers to the metal content of an ore deposit, and it is the value of the contained metals or minerals less the cost of extracting and refining that drives the economics of a mine site. There can be...

What used to be considered an illicit drug in most countries is now a decriminalized plant with some medicinal potential. Cannabis is in the midst of a global transformation into a major industry with massive investment and growth potential. Canada...

Numerous large-scale product recalls have captured national, if not global, media attention. One example is the 2008 salmonella outbreak linked to products manufactured by the Peanut Corporation of America. This incident involved the recall of more than 4,000 products produced...

The summer has come to an end in Florida. Temperatures are still hot, and the afternoon thunderstorms are raging. So, when I open my electricity bill and gasp at the month’s cost, muttering some hopeless comments about how I should...

Covid-19 has led to major disruptions across various sectors and the petroleum industry is no exception.  Demand for oil and petroleum products, in general, declined due to reduced economic activity as governments worldwide imposed lockdowns and tightened border controls. Certain...

The UK’s energy wholesale markets have reached new highs, with daily average electricity prices rising above GBP 150 per MWh since early September 2021. A record high of GBP 424 per MWh, since at least January 2019, was reached on...

The Oil and Gas industry in the insurance market is usually categorised between Onshore/Offshore or Upstream/Downstream. It includes a chain of businesses relating to extraction, transportation, refining, petrochemical and chemical – essentially from the carbon in the ground to the...

Next to “you’re on mute”, perhaps one of the most common phrases of this past year has been “don’t click on that link”! The risk of suffering a severe financial loss due to a cyber event has never been greater....

When done right, mergers and acquisitions (“M&A”) can be a great way for companies to scale their businesses and create value through synergies, to enter new markets or to gain access to transformative new technology. When done poorly, however, M&A...

Earlier this month, Australia’s Bureau of Meteorology announced that the current La Niña conditions would likely continue over the coming months.[i] According to the National Oceanic and Atmospheric Administration, the La Niña effect occurs when there are “periods of below-average...

  Although hurricane season doesn’t normally conclude until November 30th, we have already exhausted the modern English alphabet in terms of named hurricanes. In the last year, we’ve also seen an ever increasing number of wildfires, explosions and tropical storms....

Calculating business interruption losses following a natural catastrophe (“CAT”) has always been as much of an art as a science, requiring forensic accountants to use their education, experience and training to resolve the complexities inherently present in quantifying business interruption...

Business Interruption (“BI”) has hit the headlines in the Middle East possibly more than ever this year, with disputed claims over COVID-19 closures, cyber incidents and anticipated losses following the recent Beirut explosion.  This is in addition to BI claims...

COVID-19 has sent shockwaves throughout much of the insurance world. Insurance company stocks have been some of the worst performing since the virus went, well… viral, in anticipation of declines in profits due in part to COVID-related claims. Much of...

On 17 October 2019 large numbers of protesters began appearing in Martyrs Square, Nejmeh Square, and Hamra Street, as well as many other areas of Beirut and throughout Lebanon.  The reasons for the protests are wide reaching from a social,...

In this two-part series, we write about the claim considerations related to the Beirut port explosion on 4 August 2020. On 4 August 2020 at approximately 18:00 local time, an explosion measuring 3.3 on the Richter scale ripped through Beirut...

Insurers around the globe currently have their attention firmly fixed on addressing the enormity of client claims relating to COVID-19 but is there another dark cloud gathering on the horizon? Recent scientific information includes NOAA issuing their forecast on May...

This is the second blog post co-authored by MDW Law Partner, Christine Doucet, and MDD Forensic Accountants Partner, Jarrett Reaume, addressing various aspects of COVID-19’s impact on business owners and family law issues.  Their first blog post was “Guideline Income...

Business owners don’t need an economist to tell them how dramatically their profits have been affected by the COVID-19 pandemic.  For those owners who are separated from their spouse, these poor results are impacting how much “available income” they have...

I hope this will be the final installment in this series, but one never knows. Back in the summer of 2018, I wrote a short piece questioning a sensational Forbes magazine article claiming that Kylie Jenner was worth $1B, based mainly...

Life is full of second chances. During this time of global economic uncertainty and (hopefully temporary) depressed company valuations, Canadian business owners may have a second chance to revisit their estate planning strategy to determine if an opportunity exists to...

As the markets react to each update on COVID-19, a quote from Warren Buffet has seen increased circulation: “Only when the tide goes out do you see who’s been swimming naked”. The current environment has seen increasing news of corporate...

On April 11, 2020, Parliament passed Bill C-14, also known as COVID-19 Emergency Response Act, No. 2.  The main item in Bill C-14 is the Canada Emergency Wage Subsidy (“CEWS”) which grants employers who meet specific criteria the ability to...

The current outbreak of coronavirus disease (COVID-19) was first reported from Wuhan, China, on 31 December 2019. According to the World Health Organization (“WHO”), by 26 February, China had reported over 78,000 cases of COVID-19 resulting in over 2,700 deaths....

A little over a year ago, I wrote a short blog post taking issue with a Forbes magazine article that had concluded that Kylie Jenner's net worth was around $900 million. In light of last week’s news that Coty Inc., a publicly traded cosmetics firm, is...

If you have not worked with forensic accountants before, an understanding of what they do in litigation support and how they differ from other accountants may be surprising to you. Modern television dramas’ common use of the word “forensic” may...

Cyber attacks are happening with an alarming frequency, impacting mostly small to medium-sized businesses. According to Statistics Canada, in 2017 more than 20 per cent of Canadian businesses reported they were impacted by a cyber security incident. As fears of...

As anyone who followed the debate over the USMCA trade agreement last fall will know, Canada’s dairy industry is a regulated one. As a result, business interruption calculations involving dairy farms will often contain a number of moving parts that...

It’s not easy to find a rental apartment these days. Vacancy rates for residential apartments in Canada’s largest cities are at record lows. The country’s 10 most populated metropolitan areas saw their average vacancy rates decline by a collective 10%...

No one likes delays. Whether it’s a rain delay at a sporting event or a subway delay stuck somewhere beneath the city of Toronto, delays cost us time that we would rather have spent doing something else. Sometimes, however, delays...

A growing area of concern for corporates is the proportion of fraud committed by “frenemies”, an encompassing term for the third parties a company works with on a day-to-day basis. This includes suppliers, agents and consumers: entities with which a...

Handling hundreds of commercial property insurance claims every year, we have found that few things cause people more confusion than the concept of co-insurance. This article provides a brief overview of what co-insurance is, why it exists, and how it...

Malware. Ransomware. Phishing. Wannacry. Petya. NotPetya. The terminology of cyber attacks and cyber losses seems to change at a bewildering pace. As technology continues to advance and businesses become more reliant on their IT systems, cyber attacks will become more...

In this article we provide a brief overview of how to calculate losses under business interruption coverage. Broadly speaking, business interruption (“BI”) insurance coverage is meant to indemnify the insured for the loss of profit it suffers as a result...

This month our technical briefing introduces the broad topic of non-damage Business Interruption (BI), including a discussion on: The typical boundaries of traditional property damage business interruption insurance. What we mean by the term 'non-damage BI' and types of events...

Last week, the Auditor General of Toronto issued a report estimating that in 2018 alone, the TTC lost $61 million due to fare evasion. As both a frequent rider of the TTC and a forensic accountant specializing in fraud investigations, I...

Introduction Some days it seems like you can’t go anywhere in Ontario without running into a light rail transit (“LRT”) project. Projects are either underway or imminent in Toronto, Hamilton, Ottawa and right here in Mississauga along Hurontario Drive. While...

The Fraud Triangle: Rationalisation, Opportunity and Pressure Any elementary student of fraud will be aware of the “Fraud Triangle”, a theory developed by Edwin Sutherland and Donald Cressey. This theory posits three elements of fraud: Rationalisation (the ability of the...

From its origin back in the 18th century, the appetite for a form of insurance to cover losses of a business due to an interruption has continued to mature and grow. Whether the risk be fire, explosion, hurricane, cyber-attack, or...

There are many different types of liability cover available to business owners including D&O liability, professional indemnity and public liability amongest others.  However, from a claims perspective one of the most common types of cover we come across is that...

Introduction When modelling power generation losses for Business Interruption (“BI”) or Delay in Start-Up (“DSU”) purposes, it is important to understand the type of market(s) the Insured participates in and specifically how it operates within those markets. In this introductory...

In my last post, I argued that an investor in Kylie Jenner’s cosmetics company was essentially investing in Ms. Jenner’s personal brand, and that the earnings stream for that brand was of a finite life. The post got me thinking:...

The below article first appeared in THE STANDARD, New England’s Insurance Magazine. It features excerpts from a presentation given by MDD partners Paul McGowan, CPA, CVA and Jon Ducey, CPA, CVA on the topic of liability claims and other key...

Alternate dispute resolution (ADR) is any procedure that is used in matters that would otherwise be settled in a court of law. Examples of ADR include arbitration, mediation, appraisal, and mini-trial. ADR is a dispute resolution strategy with applications to...

Regrettably, individuals can experience a temporary or permanent diminishment in their ability to perform certain functions due to a tortfeasor. Forensic accountants and economists are regularly retained in matters involving the injury or death of an individual for the purpose...

A few weeks ago, Forbes created a social media storm when it proclaimed that Kylie Jenner was poised to become the world’s youngest self-made billionaire. Many thumbs were worn out debating the appropriateness of the term “self-made”, and apparently a GoFundMe page...

As a global forensic accounting firm, we at MDD have a “boots on the ground” mentality when it comes to quantifying economic damages for catastrophe (“CAT”) claims. The busy hurricane season in 2017 meant that I, along with many of...

Valuing a franchise system, or “franchisor”, is in many ways very similar to the valuation of any other type of business; it is a function of the forecasted levels of cash flows that the business will generate, and the risk...

A fraudster’s gain is someone else’s pain – or loss; but is the corporate fraudster’s gain always the same as the insured’s financial loss? Are the financial implications of the fraud always the same as the actual loss to an...

As a Chartered Business Valuator (CBV), almost every business owner I meet wants to know the answer to this question: “How much is my business worth?” There can be many reasons for asking this question: they may be planning to...

This month MDD focuses on liability claims and looks at the benefits of getting the right technical accounting expert engaged early on to stress test quantum. What you will learn from reading the article include: How early involvement provides better...

In this briefing we focus on mining claims, and share our knowledge and technical expertise on one of the loss measurement issues regularly encountered in mining claims, production bottlenecks. What you will learn from reading the article include: How the...

In my previous article, I discussed the critical need for business owners to have their business valued by a professional appraiser. In this article I will discuss the two types of business appraisals that you might want to consider. Calculation...

What's so important about having a valuation of my company? Small business owners spend most of their time IN THEIR business and not ON THEIR business. Further, they view expending money on getting a professional valuation performed as a completely...

September 2017 was a brutal month for the people of Mexico, with two earthquakes and a hurricane causing untold misery, multiple deaths and substantial property damage across the country. But if the general view in the global reinsurance market is...

Late 2017 has witnessed a flurry of catastrophic weather events that has led to widespread devastation. Hurricane Harvey set the ball rolling, with unprecedented rainfall in the southern United States. Irma then destroyed several Caribbean islands, rendering many uninhabitable, before...

Banks rely on various profes­sionals to help them assess the financial health of their borrowers. But sometimes these professionals make mistakes. As experts in quantifying economic damage, we at MDD are often asked to quantify the losses sustained by lenders...

What have we really lost? One of the most common issues that arise from short-duration interruptions, those measured in days as opposed to weeks or months, is whether the business actually suffered a permanent loss of revenue or whether the...

Mining Business Interruption Insurance and the Principle of Indemnity A contradiction? How can a mine claim for lost production when the ore is not lost and will be mined? Why does a mining company need to purchase business interruption insurance...

Cyclone Debbie and the subsequent rain and flooding events across Queensland, Northern NSW and New Zealand have caused significant damage to property and infrastructure, limited rail access, closed ports and caused damage to numerous roads and bridges. Rail closures in...

While the damage to physical property as a result of the Kaikoura earthquakes in November 2016 has been well documented, the financial impact of these events are ongoing both on businesses physically affected by the earthquakes as well as businesses...

We live in a world of Big Data. Petabytes, Zettabytes, Yottabytes of data.  The Internet of Things (IoT) increasingly connects day-to-day appliances, machines and equipment with each other. Billions of devices constantly recording data: sensors, cameras, microphones, thermostats, pressure gauges,...

With the recent release of the Ben Affleck thriller The Accountant, MDD considers what makes a good forensic accountant and whether there are particular skills and personality characteristics that are common among professional forensic accountants. In the movie, Ben Affleck...

The number of food product recalls reported in the UK through the FSA (Food Standards Agency) rose 78% in 2015. With many UK businesses operating internationally, a product recall situation can impact many countries and cost millions of pounds in...

Given the number of major flood occurrences in India in the past decade, European and US companies with exposures in the country should review their insurance coverage and disaster management planning. As the waters start to subside following India’s latest...

With a typical Energy claim standing at approximately USD 4.5 million, it’s no surprise that Business Interruption (BI) is once again the #1 business risk for the fourth year in a row[i]. To help insurers mitigate their exposure when an...

As business structures become more complex, companies often need more sophisticated insurance products to properly manage their business interruption risks. For example, narrow vertical integration makes risk management more difficult and increases the demands placed on insurers regarding correct risk...

Delay in Start Up (DSU) or Advance Loss of Profit (ALOP) insurance cover is an absolute necessity for large and/or complex construction or engineering projects, particularly those financed with structured debt.  This insurance was designed to provide cover for the...

The Canadian wildfire which started in early May 2016 southwest of Fort McMurray affected a population of about 90,000 and led to destruction of over 2,400 structures. The sheer ferocity and speed of the fire took both public services and...

In the event of a devastating catastrophe (“cat”) be it an earthquake, hurricane, flood, or tornado, the first and foremost priority is to ensure the safety all the people involved. Once this has been established, business owners can then begin...

It’s happened.  You find your company is facing the business end of a class action lawsuit.  Perhaps this stemmed from your product not meeting customers’ expectations or maybe there are allegations that your product is not performing as advertised. Now...

The most common response I hear from business owners who are victims of employee fraud is “I never thought this would happen to me”. Employee theft, especially in the automotive industry, is common, because small businesses such as car dealerships...

The Basics Assets have value if they will give rise to future economic benefits.  For businesses, these future economic benefits take the form of either the expected net income stream or the amount that could be realised in the short...

What are lost profits and how are they calculated? Lost profits are economic damages caused by a disruption in business operations. The damages can be the result of a variety of factors, some of which include patent infringement, breach of...

The lawsuit of Canadian tennis star Eugenie Bouchard v. United States Tennis Association is still at an early stage. However, as forensic accountants who spend much of their time thinking about personal injury damages and playing tennis (albeit poorly), it...

With the busiest season of the year for retail sales upon us, you are no doubt wondering what to buy for that special someone. If you’re reading this blog – and I have every reason to believe you are –...

While we’re thinking about turkey and cranberry, an important business holiday will come and go – not with the same fanfare as Thanksgiving perhaps but with significant potential for preserving the business future for those who take note. During International...

In Schwartz Levitsky Feldman LLP v. Werbin, 2015, an action was put forward by Schwartz Levitsky Feldman (SLF) claiming loss of profits due to the departure of Mr. Werbin. The firm contended that they purchased Werbin’s clients when they purchased...

The Federal Court of Appeal has issued a ruling that could have wide-ranging consequences for the calculation of patent infringement damages.  In Apotex Inc. v. Merck & Co., Inc., 2015 FCA 171, the FCA rejected the trial judge’s ruling (Merck...

In the previous post, we presented a basic framework for analyzing the impact of foreign exchange fluctuations on quantifying financial remedies. We argued that the treatment of foreign exchange should be consistent with the principal underlying the financial remedy being awarded;...

International trade is an increasingly important part of the Canadian economy, as this picture clearly shows: As a result, it is not uncommon for litigation to involve the quantification of financial remedies across multiple political and monetary boundaries. How does...

In this post, I touch on a common error I encounter in dealing with a financial analysis of multiple companies owned by the same group or individual. I call this error the “dividend double count”, for reasons that will become...

The Ontario Class Proceedings Act ("CPA"), along with its counterparts in all Canadian provinces, is rightly lauded for creating a simple, accessible way for plaintiffs collectively to bring claims before the courts when they would not have had the resources...

When a business is destroyed as a result of wrongdoing, there are two commonly used methods by which the plaintiff’s damages may be measured. One method is to appraise the value of the plaintiff’s business at the date of loss;...

The case of Varco Canada Limited v. Pason Systems Corp., 2013 FC 750 (CanLII) involved an award of over $52M based on an accounting of the defendant’s profits. Perhaps more importantly, the decision sheds light on a number of conceptual...

Pre-judgment interest is often the last thing litigants ponder. A recent award of $75 million in pre-judgment interest in Eli Lilly v. Apotex, 2014 FC 1254 (“Cefaclor”) may change that. Cefaclor involved the infringement of patents for an antibiotic. Damages...

Individuals advancing claims for loss of income due to bodily injury may have historically underreported their income to the taxation authorities. A 2011 Statistics Canada study estimated the size of Canada’s “underground economy” at up to $36 billion. Other research...

Business valuation concepts can be critical for the proper quantification of personal injury damages, particularly in the context of self-employed individuals. Business valuators are commonly called upon to assess the fair market value of small, owner-managed businesses. One of the...

Canadian courts have typically adopted one of two categories in quantifying financial losses due to bodily injury. One approach is the “lost earnings approach”. This approach attempts to directly measure the decrease in the plaintiff’s future earning level by projecting...

Moore v. Getahun 2015 ONCA 55 is a case that has already generated a lot of discussion and navel gazing in both the legal and expert communities, and I hesitated for quite a while before deciding that I had anything worthwhile to...

I have already written, in another context, about the interaction between physical assets and lost profits. I want to explore the issue from a couple of additional angles. In the 1989 film Field of Dreams, Kevin Costner’s character hears a voice telling him...

My practice involves a lot of work for property insurance companies. When damage to property occurs, the property owner may advance a claim against the third party tortfeasor for both the value of the damaged property as well as an...

In the previous post, I discussed the large pre-judgment interest award in Cefaclor. In that case, one of the issues raised by defendant’s counsel was that to award the plaintiff compound interest would result in overpayment; since the damages award is...

This post on pre-judgment interest deals with the basic question: what is the best method by which to calculate a pre-judgment interest rate? The Law Pre-judgment interest is interest that is added to a plaintiff’s monetary award in respect of...

Pre-judgment interest is possibly the least sexy topic imaginable. But there is perhaps no better vehicle for a discussion of the fundamental issues involved in financial loss quantification. A short article of mine dealing with a very large PJI award (over...

A couple of weeks back I posted on the issue of damages and taxation. The discussion was focused on awards in respect of lost profits. Someone asked me whether the same concepts apply to personal injury damages? The short answer...

The topic of what types of financial statements must be included in a disclosure document in order to comply with the disclosure requirements of the Arthur Wishart Act (“AWA”) was discussed at a recent dinner put on by the OBA’s Franchise Law section....

Towards the end of the Great War (or World War I as it came to be called), the American president, Woodrow Wilson, proclaimed Fourteen Points outlining his goals for the reconstitution of Europe, and the international state system as a...

In Canada, as a general rule, damages awards are subject to the same tax treatment as the monetary amounts they are meant to replace. For example, awards for lost profits are taxed as business income [1]. Litigation can often take...

I was looking through my oldest daughter’s baby book last night and found that we had noted the price of gas at $0.70 per litre; I had noted at the time that this was “really high”! This got me thinking...

Towards the end of its decision in Dunkin’ Brands Canada Ltd. c. Bertico inc.2015 QCCA 624, the Quebec Court of Appeal discussed the issue of whether an award for both a) lost profits up to 2005 and b) loss of business...

In April 2015, the Quebec Court of Appeal released its decision in Dunkin’ Brands Canada Ltd. c. Bertico inc. 2015 QCCA 624. The Court of Appeal upheld the trial judge’s ruling (Bertico inc. c. Dunkin' Brands Canada Ltd., 2012 QCCS 2809) that...

During the course of matrimonial disputes, there are often situations where solicitors find it helpful to engage specialist investigators and appraisers. In particular, forensic accountants can help to provide the court with a clearer view of the true financial position...

In the legal and accounting professions, potential conflicts of interest can arise before or during the course of an engagement.  Most firms have policies and procedures in place that govern how conflicts are identified and managed, to ensure that client...

Mining companies should take note of Canada’s stricter penalties and more aggressive enforcement of anti-corruption laws and make sure their anti-bribery compliance procedures are up to speed, lawyers, forensic accountants and mining executives warned at a recent conference in Toronto....

It has now been thirteen years since the Ontario Arthur Wishart (Franchise Disclosure) Act, 2000, SO 2000 [1], was enacted.  The Act, named after Arthur Wishart, a Conservative MPP who championed the rights of franchisees in the 1970's and 1980's,...

Businesses face the risk of financial loss and disruption due to theft of private or sensitive information, attacks on IT systems, and fraud. MDD's Norman Kwan shares that cyber risks policies are still evolving and there are issues that need considerations...

Damage quantification for livestock losses can be difficult as it often requires consideration of market price fluctuations, age and weight of livestock at the time of loss and the end purpose of the livestock - considering whether they are for...

This article explores the areas of overlap between insurance coverage for inventory loss and business interruption. In the event of physical damage to inventory, different policies provide different valuations, including: replacement cost, actual cash value, historical cost or selling price. ...

When a business falls victim to cheque fraud, it may look to its bank for recovery for allowing the fraudulent cheques to be cashed.  In some recent cases, banks have been found liable and have been required to make whole...

It is alleged that your client had financial motive to commit a very serious crime.  Forensic accountants are often utilized to analyze the defendant’s financial records, and provide an opinion on the existence of financial circumstances that assist in assessing...

The U.S. Chamber of Commerce estimates that occupational fraud costs U.S. businesses over $50 billion annually and that one-third of business failures are directly related to employee theft. The Chamber also estimates that 75% of all employees have stolen from...

Usually when you tell people that you’re a forensic accountant, you’re met with the same predictable and equally awful response: “So, you count dead peoples’ money?” Well, not exactly. It’s generally followed by something like, “You must be really good...

In October 2012, the Manitoba Franchise Act was proclaimed into law. The legislation, like its counterparts in several other provinces (including Ontario’s Arthur Wishart Act), provides franchisees with the right to rescind a franchise agreement within two years if a...

On June 20, 2013 Southern Alberta endured a catastrophic flood resulting in a significant amount of property damage, numerous civil authority evacuations and power outages for individuals and businesses. In any major catastrophe, access to supporting documentation may not be...

The Federal Court’s decision in Merck & Co. v. Apotex Inc. [2013] F.C.J. No. 840, has shed a novel light on to how damages for patent infringement are to be calculated. Previously, in its decision in Monsanto Canada Inc. v....

It is becoming increasingly important for attorneys to understand financial statements and their relevance to various types of business and legal situations. The non-accountant attorney will greatly benefit from a basic understanding of the key principles of accounting. Equally important...

Discovery is under-way. The records are starting to flow. As you leaf through a box of documents just delivered, you pull out a stack of financial statements and, like so many other attorneys, you cringe. As you scan through the...

In recent years the news headlines have been filled with stories about the global financial crisis. Fears of a double dip recession, the ongoing U.S. and European debt crisis, mortgage foreclosures and lingering high unemployment are issues that continue to...

New construction is a key component of the economic growth, with commercial construction among the leading sources of new jobs and increased capital spending in practically every geographical market. With millions of dollars on the line for investors, construction companies,...

Much like predictions based on interpreting the Mayan Calendar, determining the career path of a child or a student is always a difficult exercise. Typically, with an individual who has already commenced their work-life, a history of employment would be...

Assessing the income lost by a personal injury victim depends on whether the casualty is self employed, in which case assessing the loss becomes a lot more complicated. An expert on insurance litigation for MDD Forensic Accountants gives some guidance....

Are you concerned about how your employees can get around your accounting policies or what unintended impact they might have? Here are two areas where accounting policies may pose a risk. Revenue Recognition Revenue recognition is always on the mind...

It is almost ten years since the Arthur Wishart (Franchise Disclosure) Act was introduced in Ontario. The Act seeks to protect often unsophisticated purchasers of franchise rights by requiring that certain disclosures be made to franchisees prior to entering into...

Section 6(6) of the Arthur Wishart Act gives franchisees the right to rescind their franchise agreements in the event that they do not receive a disclosure document. Ostensibly, the rescission remedy is designed to return the franchisee to the position...

With increasing activity in public works projects in the Greater Toronto Area (e.g. the Toronto-York Spadina Subway extension) and other highway expansions across Ontario, we can expect a large number of businesses to be affected by expropriation. This article will...

Measurement of business interruption losses, under normal circumstances, is mathematics combined with fact gathering to establish proper assumptions in measuring the loss.  Historical records can be analyzed to determine the experience of the business had the insured loss not occurred. ...

When an insured is involved in a motor vehicle accident, they are able to pursue accident benefits from the insurer where their policy lies.  However, sometimes a situation occurs where the individual is not specifically insured.  So the question becomes:...

Fidelity losses are difficult to investigate because frauds can be complex and hard to detect.  Here are 5 steps to keep in mind when reviewing fidelity claims. They will help you review the claims quickly and help minimize the impact...

Litigation can be a scary and intimidating process.  Preparation is key and includes ensuring that the documentation you need to prove your case is ready at hand. Below are some common forms of litigation and the documentation that should be...

Corporate fraud, insider trading, 9/11, intellectual property infringement the list goes on as to instances where parties have committed acts resulting in financial losses. The legal challenge in proving financial wrongdoing is a minefield in itself, but what steps need...

While the signs have been around for some time now, the economic crisis that seemed to officially begin with the failure of the U.S. mortgage institutions Fannie Mae and Freddie Mac has now morphed into an unpleasant reality that is...

Subrogation matters have slightly different circumstances than most litigation matters. However, at the end of the day subrogation cases remain a legal dispute between plaintiff[s] and defendant[s] involving tort damages. The likelihood of "getting the money" increases with an experienced...

In the US property insurance market, coinsurance, an often-misunderstood concept, refers to the sharing of risk between the insured and the insurer and applies to property damage and business income loss coverage. Coinsurance as it applies to Property Insurance Because...

Plaintiff and Defense attorneys are guilty! Guilty of waiting until the last minute to address areas of damages. MDD is very often retained in litigation engagements when the measurement of damages takes a back seat to liability and causation. Although...

No matter how well a risk management team has planned for it, actually dealing with a catastrophe can be a distracting and stressful financial challenge.  The adjuster's ability to manage his resources and work through the complex claim issues that...

Large insurance claims are almost always complex, time-consuming and in need of a forensic accountant. They are complex because of the secondary impact from the misfortune setting off the initial claim. Take, for example, a fire at a ski hill...

For many years, attorneys on both sides of the courtroom have turned to forensic experts to support their position as well as to identify the potential strengths and weaknesses in the arguments of opposing counsel.  Additionally, attorneys can use expert...

Insurance policies generally state that in determining the Actual Loss Sustained under business income coverage, consideration must be given to actual experience of the business before and the probable experience thereafter had no loss occurred.  Thus, the goal in evaluating...

Foreign exchange risk has been high on the agenda of CFOs of MNCs for many years. With the expansion of the global economy and diverse influences on exchange rates - such as the current climate of economic uncertainty and fear...

Business valuations in one form or another have been around for decades. As a result of the Eighteenth Amendment to the United States Constitution, the Internal Revenue Service began issuing memorandums and directives relating to methods for determining values and...

It is almost ten years since the Arthur Wishart (Franchise Disclosure) Act was introduced in Ontario. The Act seeks to protect often unsophisticated purchasers of franchise rights by requiring that certain disclosures be made to franchisees prior to entering into...