6 worked Inventory Count Assistance 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 inventory count assistance work, not a specific client's file.
Case Study 1 · Missed incentive claimed
$138,000 In Credits Claimed That Prior Filings Had Missed — Reporting Franchisee, Kelowna
Client: A franchisee reporting to its franchisor · Where: Kelowna, British Columbia · Engagement: 4 weeks, fixed fee
Credits claimed$138,000
Years adjusted5
Review outcomeNo adjustment
The situation — A franchisee reporting to its franchisor, Kelowna, British Columbia
A franchisee reporting to its franchisor in Kelowna, British Columbia had been filing for 5 years without ever claiming the incentives its activity qualified for. Behind that sat an insurer asking for statements from an independent practitioner who had also been writing the bookkeeping entries.
What we did for A franchisee reporting to its franchisor, Kelowna, British Columbia
We tested each activity against the eligibility criteria rather than the description on the invoice, then prepared a due-diligence-ready statement set with supporting schedules for each material balance.
The result — A franchisee reporting to its franchisor, Kelowna, British Columbia
$138,000 in credits claimed, with the open prior years adjusted as well. The claim passed review without adjustment.
Client: A corporation entering a shareholder buyout · Where: Moncton, New Brunswick · Engagement: 4 weeks, fixed fee
Penalty cancelled$105,000
Relief applicationGranted
ReturnAccepted as filed
The situation — A corporation entering a shareholder buyout, Moncton, New Brunswick
A corporation entering a shareholder buyout in Moncton, New Brunswick had already missed one deadline and was about to miss a second. Behind it sat an insurer asking for statements from an independent practitioner who had also been writing the bookkeeping entries, and a penalty of $105,000 was accruing.
What we did for A corporation entering a shareholder buyout, Moncton, New Brunswick
We split the work into what had to happen before the deadline and what could follow it, then converted the records to the accrual basis, restated the comparative year with proper disclosure, and rebuilt the statement package around the bonding company’s requirements.
The result — A corporation entering a shareholder buyout, Moncton, New Brunswick
The outstanding return was accepted as filed, and the taxpayer relief application cancelled $105,000 of the penalty already assessed on the earlier year.
Case Study 3 · CRA review defended
$139,000 Reassessment Reduced To Nil On Review — Due-Diligence Vendor, Victoria
Client: A vendor assembling due-diligence records · Where: Victoria, British Columbia · Engagement: 8 weeks, fixed fee
Reassessment reduced toNil
Tax protected$139,000
Prior filingsUndisturbed
The situation — A vendor assembling due-diligence records, Victoria, British Columbia
A review notice arrived at a vendor assembling due-diligence records in Victoria, British Columbia covering inventory count assistance for two tax years. The auditor's working position was an adjustment of $139,000, driven by a buyer’s due-diligence list that the existing statement package could not answer.
What we did for A vendor assembling due-diligence records, Victoria, British Columbia
Rather than negotiate, we rebuilt the record. We prepared the supporting schedule for every material balance in advance, which cut the queries the engagement had to raise and submitted a point-by-point response that answered each proposed adjustment with the document behind it.
The result — A vendor assembling due-diligence records, Victoria, British Columbia
The auditor accepted the documented position and closed the review without adjustment, protecting $139,000 and leaving the prior filings undisturbed.
Case Study 4 · Objection and relief
Desk-Review Assessment Of $15,500 Vacated — Bonded Work Bidder, Kitchener
Client: A contractor bidding on bonded work · Where: Kitchener, Ontario · Engagement: 6 weeks, fixed fee
Assessment vacated$15,500
Supporting recordsNow on file
AccountCleared
The situation — A contractor bidding on bonded work, Kitchener, Ontario
A contractor bidding on bonded work in Kitchener, Ontario was carrying $15,500 of penalties and interest arising from a bank asking for a review engagement while the file only supported a compilation, much of it accumulated during a period the CRA itself had delayed.
What we did for A contractor bidding on bonded work, Kitchener, Ontario
We described the revenue and inventory policies in the basis-of-accounting note in terms a lender could follow without asking a question and framed the relief application on the specific grounds the CRA guidelines recognise rather than on general hardship.
The result — A contractor bidding on bonded work, Kitchener, Ontario
The assessment was vacated. $15,500 came off the account, and the documentation now on file makes the same position straightforward to defend next time.
Case Study 5 · Scaling without breaking
Growth Handled Without A Missed Filing, $144,000 Freed — Covenant-Bound Borrower, Brampton
Client: A company under a bank covenant · Where: Brampton, Ontario · Engagement: 10 weeks, fixed fee
Cash freed$144,000
Compliance failuresNone
ReportingMonthly
The situation — A company under a bank covenant, Brampton, Ontario
A company under a bank covenant in Brampton, Ontario was opening in a second province — different filing obligations, a different payroll regime, and a shareholder agreement calling for audited statements that had been satisfied with a compilation for years already in the file.
What we did for A company under a bank covenant, Brampton, Ontario
We read the shareholder agreement and the loan documents, established what level of assurance each user actually required, and scoped the engagement to the highest of them and put monthly reporting in place so the owner could see the cash effect of growth while there was still time to act on it.
The result — A company under a bank covenant, Brampton, Ontario
Growth was absorbed without a compliance failure. $144,000 of cash was released, and the monthly reporting now flags a problem while it is still small.
Case Study 6 · Structure rebuilt
Reorganisation Completed Tax-Deferred, $61,000 Saved Each Year — Restating Corporation, London
Client: A corporation restating a prior year · Where: London, Ontario · Engagement: 7 weeks, fixed fee
Annual saving$61,000
Tax on reorganisationDeferred
Elections filedOn time
The situation — A corporation restating a prior year, London, Ontario
A corporation restating a prior year in London, Ontario had outgrown the structure it started with. Statements delivered five months after year-end, past the covenant deadline was the immediate problem; the longer-term one was that the structure blocked the next step.
What we did for A corporation restating a prior year, London, Ontario
We mapped the current structure, modelled the target, and compressed the close to 45 days by moving reconciliations into the monthly cycle, so the covenant deadline stopped being a scramble — with the tax-deferred elections filed on time and the supporting valuations documented.
The result — A corporation restating a prior year, London, Ontario
The reorganisation completed without triggering tax, and the new structure saves approximately $61,000 a year while removing the exposure the old one carried.
Reviewed for the 2025 tax year by Udit Gupta, Founder and Tax Accountant. 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.
