Fixed Asset Register and Depreciation Accounting Case Studies
6 worked Fixed Asset Register and Depreciation Accounting case studies — the position a client typically comes to us with, what we do, and what it is worth. Each is an illustrative example built on the rules that apply to fixed asset register and depreciation accounting work, not a specific client's file.
Case Study 1 · Scaling without breaking
Scaled To 60 Staff With $54,000 Of Working Capital Freed — Off-Calendar Year-End Supplier, Kelowna
Client: A supplier with an off-calendar fiscal year-end · Where: Kelowna, British Columbia · Engagement: 4 weeks, fixed fee
Headcount reached60
Working capital freed$54,000
Missed deadlinesZero
The situation — A supplier with an off-calendar fiscal year-end, Kelowna, British Columbia
A supplier with an off-calendar fiscal year-end in Kelowna, British Columbia was growing fast, with headcount reaching 60 in eighteen months. The back office had not kept up. A shareholder loan account that had drifted for three years with no supporting entries was the first thing to break.
What we did for A supplier with an off-calendar fiscal year-end, Kelowna, British Columbia
We reconciled the inter-company accounts, papered the arrangement with a written agreement, and aligned both corporations’ year-ends. We built the compliance calendar for the size the business was becoming rather than the size it had been.
The result — A supplier with an off-calendar fiscal year-end, Kelowna, British Columbia
The business reached 60 staff with no missed remittance and no late filing. $54,000 of working capital was freed in the process.
Case Study 2 · Sale and succession
$555,000 Sheltered By The Lifetime Capital Gains Exemption — Independent Pharmacy, Halifax
Client: An independent pharmacy · Where: Halifax, Nova Scotia · Engagement: 4 weeks, fixed fee
Gain sheltered$555,000
ClosingOn schedule
Share qualificationMet
The situation — An independent pharmacy, Halifax, Nova Scotia
An independent pharmacy in Halifax, Nova Scotia had an offer on the table and 22 months to close. The shares did not qualify for the capital gains exemption. Retained cash well above what the business needed to operate was part of the reason.
What we did for An independent pharmacy, Halifax, Nova Scotia
We purified the corporation so the shares met the qualifying tests. We set a monthly close calendar with a fixed cut-off, so the year-end became a review of work already done rather than a twelve-month rebuild. All of it was done well ahead of the closing date.
The result — An independent pharmacy, Halifax, Nova Scotia
The sale closed on schedule with $555,000 sheltered by the lifetime capital gains exemption across the shareholders.
Case Study 3 · Objection and relief
$112,000 Of Penalties And Interest Cancelled On Relief — Machine-Shop Owner-Operator, Guelph
The situation — A machine-shop owner-operator, Guelph, Ontario
An assessment of $112,000 landed at a machine-shop owner-operator in Guelph, Ontario following a desk review. It turned on capital assets written off in full in the year of purchase, with no fixed-asset schedule behind the deduction. The auditor had not seen the records behind it.
What we did for A machine-shop owner-operator, Guelph, Ontario
We separated personal and corporate spending, cleared the shareholder loan through a documented salary and dividend mix, and restated the comparative year. We then set out the legislative basis for the position alongside the documents supporting it.
The result — A machine-shop owner-operator, Guelph, Ontario
$112,000 of penalties and interest was cancelled under the taxpayer relief provisions, and the underlying assessment was adjusted to match the filed position.
Case Study 4 · Cash and remittance control
Instalments Rebased, $20,500 Of Cash Returned To The Business — Design Agency, Saskatoon
The situation — A 14-person design agency, Saskatoon, Saskatchewan
A 14-person design agency in Saskatoon, Saskatchewan was paying instalments calculated on a prior year. That year no longer reflected the business. Two sets of numbers — one in the accounting file, one the owner actually ran the business on was tying up $20,500 of cash.
What we did for A 14-person design agency, Saskatoon, Saskatchewan
We rebased the instalments on the current-year estimate rather than the prior-year default. Alongside that, we rebuilt the trial balance from source documents, reconciled every bank and credit-card account, and issued a CSRS 4200 compilation with a proper basis-of-accounting note.
The result — A 14-person design agency, Saskatoon, Saskatchewan
$20,500 of cash stayed in the business, the penalty cycle ended, and the instalment position is reviewed each quarter against actual results.
Case Study 5 · CRA review defended
$130,000 Reassessment Reduced To Nil On Review — Specialty Food Importer, Lethbridge
Client: A specialty food importer · Where: Lethbridge, Alberta · Engagement: 3 weeks, fixed fee
Reassessment reduced toNil
Tax protected$130,000
Prior filingsUndisturbed
The situation — A specialty food importer, Lethbridge, Alberta
A review notice arrived at a specialty food importer in Lethbridge, Alberta, covering fixed asset register and depreciation accounting for two tax years. The auditor's working position was an adjustment of $130,000. It was driven by a year-end moved informally, leaving twelve months of trading reported as though nothing had changed.
What we did for A specialty food importer, Lethbridge, Alberta
Rather than negotiate, we rebuilt the record. We moved accruals, prepaids and depreciation into a documented month-end checklist, so they stopped being year-end discoveries. We then submitted a point-by-point response that answered each proposed adjustment with the document behind it.
The result — A specialty food importer, Lethbridge, Alberta
The auditor accepted the documented position and closed the review without adjustment, protecting $130,000 and leaving the prior filings undisturbed.
Case Study 6 · Backlog brought current
$109,000 Of Arbitrary Assessments Vacated After 7 Years — Related-Company Pair, London
Client: A corporation sharing administration with a related company · Where: London, Ontario · Engagement: 11 weeks, fixed fee
Arbitrary tax vacated$109,000
Years brought current7
Account statusCurrent
The situation — A corporation sharing administration with a related company, London, Ontario
7 years of unfiled returns had turned into notional assessments at a corporation sharing administration with a related company in London, Ontario. Underneath lay inter-company balances between two related corporations that had never been reconciled. Collections had already started.
What we did for A corporation sharing administration with a related company, London, Ontario
We reconciled the general ledger to the GIFI schedules filed for each open year and corrected the two years where they disagreed. We then filed every outstanding year in chronological order so the CRA could vacate the notional assessments cleanly.
The result — A corporation sharing administration with a related company, London, Ontario
All 7 years were accepted as filed. $109,000 of arbitrarily assessed tax was vacated, collections action stopped, and the account is current for the first time in 7 years.
Reviewed by Udit Gupta, Founder and Tax Accountant for the 2025 tax year. These case studies are illustrative worked examples composed from the CRA rules that apply to this type of work, not specific client files; figures are representative and outcomes depend on your own facts.
