CPA Canada cuts staff in advance of Ontario, Quebec exit

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Canada’s national accounting organization has laid off a fifth of its employees in advance of the pullout of all its Ontario and Quebec members, as part of an industry split.

Last week, The Chartered Professional Accountants of Canada’s chief executive officer, Pamela Steer, told employees in an internal memo the organization is “in a challenging operating environment” amid the impending withdrawals of CPA Ontario and CPA Quebec. The pullout, she said, triggered the CPA Canada leadership team to conduct a strategic review of the organization.

“After sober reflection on future needs, it became clear that organizational changes are needed to ensure the long-term success of a CPA Canada that best serves members and the profession,” Ms. Steer wrote in the memo, which The Globe and Mail obtained. “Unfortunately, this means making difficult decisions that will impact 20 per cent of our workforce.”

CPA Canada has approximately 400 employees across the country. In the same announcement, CPA Canada also said there will be a segment of employees who will remain with the organization but see their role change.

“These decisions, while extremely difficult, reflect our commitment to sustain a vibrant and thriving national organization through a transformational period for the Canadian accounting profession.”

In a statement to The Globe, Ms. Steer said the laid-off employees are “good people who have worked hard on behalf of our profession and CPAs across Canada.” She said her group had commissioned a membership poll that said 89 per cent of its membership “reaffirmed the need for a strong national accounting body.”

CPA Ontario and CPA Quebec announced their intentions last June to end their formal relationship with the national organization, starting an 18-month withdrawal process. At the time, Ms. Steer said the fracture with the two largest provincial groups had been brewing for five years prior and was around “a few key issues” where the two provinces are seeking to have more control over the profession.

Also at the time, CPA Ontario had cited the “size and complexity” of the province’s economy being “unique” in its decision to end relations with CPA Canada, saying the move in part would help advance the profession by being “more nimble and innovative.” The Quebec CPA Order said its decision was similar to Ontario’s but also took into consideration “the unique needs of the Quebec economy,” and ensuring the organization was in compliance with all obligations and responsibilities under the province’s legislative and regulatory framework.

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The withdrawals add to a challenging time for CPA Canada, which has lost $11.25-million in the year ended March 31, 2023. That included $8.77-million in spending on “strategic initiatives,” which the organization pulled from a dedicated $21-million fund.

The organization recorded $130.2-million in revenue in the 12 months, including $72.8-million in membership fees.

While CPA Canada declined to estimate the revenue hit it will take from the departure of Ontario and Quebec, the two provinces contribute about 60 per cent of the 220,000 CPAs the national group considers to be members. That would work out to more than $40-million based on the past fiscal year’s dues.

The splitting up of provinces will also break up a national organization that formed more than a decade ago by a collaboration accord that unified three groups of accountants who did different kinds of work.

CPA Canada was born Jan. 1, 2013, with a new “chartered professional accountant” designation. Previously, the profession in Canada was divided by function: Certified general accountants, certified management accountants and chartered accountants had different jobs, certification programs, regulations – and their own national associations.

The three groups proposed a unification framework in 2012, and by late 2014, all three had become part of the new CPA Canada. At the time, the groups said the framework for unification was driven, in part, by having a common certification program, a single set of high ethical and practice standards, and to govern the accounting profession in an effective and efficient manner.

Currently, CPA Canada creates the exam for chartered accountants, publishes the standards for the organization’s handbook used in all provinces and advocates for the profession, while the non-Quebec provincial accounting groups using the CPA banner are responsible for protecting the public through regulation and discipline of accountants. (In Quebec, the provincial government does this.)

In last week’s internal memo, Ms. Steer told CPA Canada employees that, despite many discussions and continuing efforts, “it has become clear that Ontario and Quebec will not change their current path,” and that, as of December, 2024, the two organizations will leave CPA Canada.

Quebec CPA Order CEO Geneviève Mottard said in an e-mail that Quebec “remains committed” to working with CPA Canada and its provincial colleagues on issues of importance to the profession such as “education and standard setting,” and to ensure those areas receive proper financial support.

“We have learned about the restructuring at CPA Canada and we are obviously saddened for the people affected by this situation,” she added.

CPA Ontario spokesperson Kathryn Hanley echoed Ms. Mottard, stating in an e-mail that Ontario is “committed” to continuing to work with CPA Canada and its provincial colleagues to “ensure all areas of shared importance, including education and standard setting, continue to receive the appropriate financial support.”

She added: “While we cannot comment on the reasons behind organizational decisions made by CPA Canada, our thoughts are obviously with all those who have been impacted by this news.”

Both Ms. Hanley and Ms. Mottard confirmed to The Globe that there have been no job cuts at either CPA Ontario and Quebec CPA Order since the announcement each made last June.