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Billable hours- Specific blocks of time incurred by professional service firms that can be charged back to clients at the firm's hourly billing rate. These hours exclude time spent on indirect functions like general administration.
CA- Member of the Canadian Institute of Chartered Accountants. CA firm refers to a firm of practicing Chartered Accountants.
Capital cost allowance- Capital cost allowance is a term used in Canada to describe depreciation for income tax purposes. (See Depreciation in this Glossary). Every company is permitted to use the depreciation method of its choice as long as it is a methodology which falls under the umbrella of generally accepted accounting principles. However, when filing a corporate income tax return, the tax authorities do not permit any depreciation methodology other than the specific one which is permitted for income tax purposes; this methodology is called Capital Cost Allowance (CCA). It is basically a declining-balance method, which means that a fixed rate is applied to the undepreciated capital cost (UCC) of the asset class at the end of each fiscal year. The UCC refers to the original cost minus the total accumulated CCA from prior years. The government sets a fixed CCA rate for each of various asset classes, for example, 20% for furniture and fixtures and 55% for computer equipment. All purchases of the asset class are grouped together and the CCA is taken on the group total. For example, suppose a company purchases a computer for $1000 in 2008. The CCA would be one-half of 55% of the purchase price, or $275. The reason for the one-half is that you are only permitted to apply one-half of the purchase cost in the year of acquisition. At the end of 2008 the UCC would be $725, which is $1000 less the CCA of $275. Then suppose the company purchases an additional computer in 2009 for $1200. One-half of this amount would be added to the computer class in 2009 (year of acquisition), and then CCA would be calculated on the UCC at end of 2008 plus the new acquisition. This comes to $725 plus $600, times 55% which equals $728.75. Then the new UCC at end of 2009 would be $1196.25, which is the previous UCC of $725 plus the new addition of $1200 less the CCA of $728.75.
Carrying on business in Canada- This term is explained in the Income Tax Act, and includes carrying on a profession, trade, manufacture or undertaking of any kind including an adventure in the nature of trade, but excluding an office or employment. The term also extends to those who produce, grow, mine, fabricate, improve, pack or preserve anything either in whole or in part in Canada, and to those who solicit orders or offer anything for sale in Canada through an agent.
Chart of accounts- A list of account titles and numerical designations which are used to incorporate into the financial statements of a business entity.