Year-End Financial Statement Preparation Case Studies
6 worked Year-End Financial Statement Preparation 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 year-end financial statement preparation work, not a specific client's file.
Case Study 1 · CRA review defended
Audit Defence Closed In 10 Weeks, $11,500 Cleared — Shareholder Buyout Corporation, Victoria
Client: A corporation entering a shareholder buyout · Where: Victoria, British Columbia · Engagement: 10 weeks, fixed fee
Proposed tax cleared$11,500
Review duration10 weeks
OutcomeNo change
The situation — A corporation entering a shareholder buyout, Victoria, British Columbia
A corporation entering a shareholder buyout in Victoria, British Columbia was selected for review. An insurer asking for statements from an independent practitioner who had also been writing the bookkeeping entries had shown up in the CRA's automated matching. The proposed adjustment on year-end financial statement preparation came to $11,500.
What we did for A corporation entering a shareholder buyout, Victoria, British Columbia
We prepared the supporting schedule for every material balance in advance, which cut the queries the engagement had to raise. Every figure in the response traced to a source record the auditor could verify without asking a second question.
The result — A corporation entering a shareholder buyout, Victoria, British Columbia
The review closed with no change. $11,500 of proposed tax came off the table, and the documentation now in place makes the next review a short one.
Case Study 2 · Planning that cut the bill
Remuneration Review Saved $10,000 Across Corporate And Personal Returns — Bonded Work Bidder, Red Deer
Client: A contractor bidding on bonded work · Where: Red Deer, Alberta · Engagement: 5 weeks, fixed fee
Combined saving$10,000
ScopeCorporate + personal
Future yearsNo rework needed
The situation — A contractor bidding on bonded work, Red Deer, Alberta
Nothing was wrong at a contractor bidding on bonded work in Red Deer, Alberta. The filings were on time and accurate. What they were not was planned. A bank asking for a review engagement while the file only supported a compilation had never been reviewed.
What we did for A contractor bidding on bonded work, Red Deer, Alberta
We compressed the close to 45 days by moving reconciliations into the monthly cycle, so the covenant deadline stopped being a scramble. We ran the numbers across both the corporate and personal returns, so the saving was real rather than deferred into someone else's hands.
The result — A contractor bidding on bonded work, Red Deer, Alberta
$10,000 came off the combined corporate and personal tax bill, and the structure holds for future years without further work.
Case Study 3 · Records and systems rebuilt
Month-End Close Cut From 12 Weeks To 6 Days — Restating Corporation, Kitchener
Client: A corporation restating a prior year · Where: Kitchener, Ontario · Engagement: 8 weeks, fixed fee
Close time before12 weeks
Close time after6 days
Year-endReview, not rebuild
The situation — A corporation restating a prior year, Kitchener, Ontario
The accounting file at a corporation restating a prior year in Kitchener, Ontario had a weak foundation. It was built on statements delivered five months after year-end, past the covenant deadline. The year-end had taken 12 weeks each of the last three years.
What we did for A corporation restating a prior year, 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. We also moved the reconciliations into the monthly cycle, so the year-end stopped being a rebuild.
The result — A corporation restating a prior year, Kitchener, Ontario
The file reconciles. Month-end closes in 6 days instead of 12 weeks, and the year-end is a review rather than a reconstruction.
Case Study 4 · Objection and relief
Notice Of Objection Allowed In Full, $67,000 Reversed — Reporting Franchisee, Regina
Client: A franchisee reporting to its franchisor · Where: Regina, Saskatchewan · Engagement: 11 weeks, fixed fee
Amount reversed$67,000
ObjectionAllowed in full
Account balanceNil
The situation — A franchisee reporting to its franchisor, Regina, Saskatchewan
A franchisee reporting to its franchisor in Regina, Saskatchewan had been reassessed for $67,000. 16 days were left on the objection deadline. The reassessment rested on a bonding limit capped because the last statements were prepared on a cash basis.
What we did for A franchisee reporting to its franchisor, Regina, Saskatchewan
We filed the objection inside the deadline with a complete submission rather than a placeholder. Alongside it, we upgraded the engagement to a CSRE 2400 review, completed the additional procedures, and delivered a package the lender accepted without conditions.
The result — A franchisee reporting to its franchisor, Regina, Saskatchewan
The appeals officer allowed the objection in full. $67,000 was reversed and the account returned to a nil balance.
Case Study 5 · Backlog brought current
7 Years Filed, $136,000 Removed From The Assessed Balance — Due-Diligence Vendor, Brampton
Client: A vendor assembling due-diligence records · Where: Brampton, Ontario · Engagement: 4 weeks, fixed fee
Years filed7
Assessed balance removed$136,000
CollectionsStopped
The situation — A vendor assembling due-diligence records, Brampton, Ontario
A vendor assembling due-diligence records in Brampton, Ontario had not filed for 7 years. The CRA had issued arbitrary assessments. The business was carrying a prior-year restatement with no note explaining what changed. That came on top of a growing interest balance.
What we did for A vendor assembling due-diligence records, Brampton, Ontario
We started with the oldest year and worked forward so each year's closing balances fed the next. We prepared a due-diligence-ready statement set with supporting schedules for each material balance. We filed the years in sequence rather than all at once.
The result — A vendor assembling due-diligence records, Brampton, Ontario
Every year is now filed and assessed on actual figures. The notional assessments were vacated and $136,000 of the estimated balance came off, with a payment arrangement covering the rest.
Case Study 6 · Missed incentive claimed
$40,000 In Credits Claimed That Prior Filings Had Missed — Covenant-Bound Borrower, Burnaby
Client: A company under a bank covenant · Where: Burnaby, British Columbia · Engagement: 4 weeks, fixed fee
Credits claimed$40,000
Years adjusted4
Review outcomeNo adjustment
The situation — A company under a bank covenant, Burnaby, British Columbia
A company under a bank covenant in Burnaby, British Columbia had been filing for 4 years. In that time, the incentives its activity qualified for were never claimed. Behind that sat a buyer’s due-diligence list that the existing statement package could not answer.
What we did for A company under a bank covenant, Burnaby, British Columbia
We tested each activity against the eligibility criteria rather than the description on the invoice. Then we separated the bookkeeping work from the assurance engagement so the independence question had one clear answer.
The result — A company under a bank covenant, Burnaby, British Columbia
$40,000 in credits claimed, with the open prior years adjusted as well. The claim passed review without adjustment.
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.
