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Canadian Association of Insolvency and Restructuring Professionals

CAIRP Annual Report 2013-2014

StrategyLaunched

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THE VISION STATEMENT OF THE ASSOCIATION IS:

“CAIRP members are recognized leaders in providing solutions to financially challenged individuals and

businesses and are the Go-To Professionals for expertise, information and solutions regarding insolvency and

restructuring”

THE VALUE STATEMENT OF THE ASSOCIATION IS:

"CAIRP and its members are committed to professionalism, trustworthiness and objectivity."

THE MISSION STATEMENT OF THE ASSOCIATION IS:

"To:

educate and support its members in providing insolvency, restructuring and related advisory services in a

manner that instils the highest degree of public trust; and

advocate for a fair, transparent and effective system of insolvency and restructuring administration throughout

Canada."

2013/2014 EXECUTIVE COMMITTEE

Left to right: David Wood, Paul Casey, Chantal Gingras, Ian Penney, Anthony Tillman and Mark Yakabuski

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2013/2014 BOARD OF DIRECTORS

CHAIR

Paul M. Casey, CPA, CA, CIRP

Toronto, ON

VICE-CHAIR

David Wood, CIRP

Vancouver, BC

SECRETARY

Chantal Gingras, CIRP

Gatineau, QC

CPA CANADA REPRESENTATIVE

Ian Penney, CA, CIRP

St. John’s, NL

TREASURER

Anthony Tillman, CA, CIRP

Vancouver, BC

PRESIDENT AND CHIEF OPERATING OFFICER

Mark Yakabuski, B.A. (Hons.)

Toronto, ON

ALBERTA

Vanessa Allen (formerly Grant), CIRP

BRITISH COLUMBIA

Craig Munro, CA, CIRP

MANITOBA

Bruce Caplan, CA, CIRP

NEW BRUNSWICK

Matthew Munro, CGA, CIRP

NEWFOUNDLAND and LABRADOR

Nancy Snedden, CA, CIRP

NOVA SCOTIA

Robert Hunt, CA, CIRP

ONTARIO

André Bolduc, CPA, CA, CIRP

Sharon S. Hamilton CPA, CA, CIRP

QUEBEC

Stéphane Lachance, CPA, CA, CIRP

SASKATCHEWAN

Jennifer Kelly, CIRP

NEW MEMBER REPRESENTATIVE

Gordon Boersma CMA, CIRP

OUTSIDE DIRECTOR

Hon. Yoine Goldstein, B.A., B.C.L. (Hon.), D.E.C.D.,

D.de l’U. (Hons), L.L.D., Ad.E.

ADVISORY COUNCIL

1979-80 L. Claude Mercure, FCIRP (ret.)*

1980-81 Keith G. Collins, FCPA, CA, FCIRP*

1981-82 Ian K. Strang, FCA, FCIRP*

1982-83 C. Garth MacGirr, FCPA, CA, FCIRP (ret.)

1983-84 Donald J. Henfrey, FCA, FCIRP (ret.)

1984-85 Gary F. Colter, FCPA, CA, FCIRP (ret.)

1985-86 John J. Swidler, FCPA, CA, FCIRP

1986-87 Beverly W. Fowler, FCIRP (ret.)

1987-88 Alan G. Driver, FCIRP (ret.)

1988-89 George B. Lomas, FCA, CFE, FCIRP

1989-90 Terence M. McMullen, FCA, FCIRP (ret.)

1991-92 J. Alan MacKinnon, FCA, FCIRP (ret)

1992-93 Uwe Manski, FCPA, FCA, FCIRP

1993-94 William J. Drake, FCA

1994-95 Gilles Campeau, FCIRP (ret.)

1995-96 Stephen H. Barnes, FCIRP (ret.)

1996-97 Ralph W. Peterson, FCIRP (ret)

1997-99 Robert O. Sanderson, FCA, CA, FCIRP

1999-01 Peter D. Wedlake, LL.B., FCIRP

2001-03 Larry W. Prentice, FCA, CA, FCIRP

2003-05 William Alan Courage, CPA, CA, FCIRP

2005-07 Claude Gilbert, FCPA, FCA, FCIRP

2007-09 Alan H. Spergel,

B.Comm., CPA, CA, CFE, FCIRP

2009-11 Kevin Brennan, CA, FCIRP

2011-13 Guylaine Houle, BCL, FCIRP

* Deceased

ASSOCIATION STAFF

President and Chief Operating Officer

Mark Yakabuski, B.A. (Hons.)

Director of Finance & Administration

Ali Hemani, CGA

Director of CAIRP Education Programs

Bea Casey, B.Sc., MBA

Communications Manager

Andrew Flynn, B.A., MJ

Membership and Committee Relations Manager

Baalqis Hassan, B.A.

Registrar, CIRP Qualification Program

Isabelle Gauthier

Executive Assistant to the President and Chief Operating

Officer

Sophia Harris, B.Sc., MSc.

CQP Administrator

Renzo Libaque, B.Sc.

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CHAIR’S MESSAGE

It is with pride that your

Board of Directors presents

the CAIRP Annual Report

for the year ended March

31, 2014. We view our

past year as wholly

successful in delivering

value to our members, our

clients, our colleagues in

the restructuring and

insolvency profession, and the public. In addition to

presenting another successful season of continuing

education and CQP programming, we have further

advanced the four strategic goals of our 2012 Strategic

Plan.

While the detailed reports from our hard-working

Committee and Task Force Chairs will list the activities,

successes, and volunteer professionals of these groups, I

highlight our 2013/2014 performance in continuing

education, CQP and finance and administration to

demonstrate our commitment to CAIRP’s value and

mission statements, and to the implementation of our

Strategic Plan. If you haven’t referenced this recently,

you can access our 2012 Strategic Plan at

http://www.cairp.ca/_files/file.php?fileid=filewSttiSXkEr

&filename=file_Strategic_Plan_2012__version_15_FIN

AL_ENG.pdf.

Continuing Education

With the strong leadership of our continuing education,

commercial program and annual conference Chairs and

CAIRP staff, we presented another outstanding season of

programming across the country. In order, CAIRP

Forums were held in Winnipeg, Vancouver, Edmonton,

Toronto, Halifax and Montreal, and provided members

and non-members with the opportunity to hear and share

valuable insights on key industry issues. The sessions

were very well attended with vigorous audience

participation.

In March of this year, CAIRP celebrated the Tenth

Anniversary of our popular Commercial Insolvency &

Restructuring Program in Toronto. Delegates were

treated to engaging industry and technical panels and

presentations, an outstanding discussion from a panel of

commercial insolvency judges, and even a mock pitch

where advisors presented their cases to a panel of special

loans lenders for real-world feedback. We are also

pleased to report that CAIRP received unprecedented

support from our members and legal partners for the

2014 Program.

Our flagship continuing education event, the Annual

Conference, was held in St. John’s, Newfoundland last

August and featured General (Ret.) Rick Hillier as our

keynote speaker. More than 220 members, presenters and

corporate partners were treated to Newfoundland’s finest

hospitality, while taking in the technical, economic and

social curriculum.

These programs demonstrate our Association’s

commitment to educating and supporting our members in

providing insolvency, restructuring and related advisory

services in a manner that instills the highest degree of

public trust.

CIRP Qualification Program (CQP)

The signing of the Memorandum of Understanding with

the Superintendent of Bankruptcy on October 8, 2009

saw the repatriation of the CQP back to CAIRP. Since

then, we have overhauled the Introductory, Core

Knowledge and Advanced Knowledge courses, and have

fully implemented our competency-based National

Insolvency Exam. To support our articling associates, we

have continued to evolve and enhance our annual tutorial,

and have added significant content related specifically to

competency-based exam preparation, including theory,

representative questions, and personal feedback on

solutions.

In October, 2013, 100 candidates from across the country

challenged the CNIE at over 20 centres and we

welcomed 54 new CIRPs to membership.

Congratulations to our new members!

To state the obvious, our qualification program is perhaps

the most important element in developing and qualifying

future leaders for our profession, and maintaining and

growing our reputation as the “Go-To Professionals” for

expertise, information and solutions regarding insolvency

and restructuring.

Finance and Administration

You will see from our audited financial statements and

Treasurer’s Report that CAIRP has maintained its strong

financial position over the course of fiscal 2014.

Revenues over expenses for the year were basically

breakeven at $2,000 (2013 - $458,000), resulting in

substantially unchanged restricted and non-restricted

equity available to invest in the goals of the Association.

This year’s results reflect the forecast decline in CQP

enrollment (but not to the extent budgeted). Certain

budgeted disbursements for CQP development and

maintenance, and for communications initiatives, did not

fully accrue this year, and will continue into the 2015

year.

http://www.cairp.ca/_files/file.php?fileid=filewSttiSXkEr&filename=file_Strategic_Plan_2012__version_15_FINAL_ENG.pdf



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CAIRP is led by a strong senior management team under

the guidance of our President and COO, and our

Directors of Education and Finance and Administration.

The “back office” is running very smoothly allowing

CAIRP staff and the Board to focus on strategic

initiatives and goals.

I urge you to review the 2013 – 2014 Annual Report in

detail. This was a very successful year for your

Association, but there is much more to do. With our

team, expertise and resources, your Board is confident

that we can continue to meet our goals and deliver on our

Mission Statement.

One final comment: Note 1(h) in the notes to CAIRP’s

2013 financial statements discloses that “the work of the

Association is dependant on the voluntary service of

many individuals”. I suggest that this statement, while

accurate, is materially understated. We loosely estimate

that over 220 of our members volunteered their

professional time to CAIRP to deliver our continuing and

CQP education programs, sit on Committees or Task

Forces, or participate in critical administrative matters in

2013-2014. This is a meaningful percentage of our

membership, and demonstrates your commitment to our

profession. Our success this year is due to your effort.

Thank you.

Paul, M. Casey, CPA, CA, CIRP

Chartered Insolvency and Restructuring Professional,

Chair

[email protected]

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2013-2014 COMMITTEES

ANNUAL CONFERENCE (2013)

* Chantal Gingras, CIRP QC

Mark Yakabuski, B.A. (Hons.) ON

Paul M. Casey, CPA, CA, CIRP ON

Virginie Comtois, CPA, CA, CIRP QC

John P. Haralovich, CA, CMA, CIRP, CFE ON

Ali R. Hemani, CGA ON

Craig Munro, CIRP BC

BOARD OF DIRECTORS

* Paul M. Casey, CPA, CA, CIRP ON

David Wood, CIRP BC

Chantal Gingras, CIRP QC

Anthony Tillman, CA, CIRP BC

Ian Penney, CA, CIRP NL

Vanessa Allen (formerly Grant), CIRP AB

Gordon Boersma, CMA, CIRP AB

André Bolduc, CPA, CA, CIRP ON

Bruce Caplan, CA, CIRP MB

Sharon S. Hamilton, CPA, CA, CIRP ON

Robert Hunt, CA, CIRP NS

Jennifer Kelly, CIRP SK

Stéphane Lachance, CPA, CA, CIRP QC

Craig A. Munro CA, CIRP BC

Matthew Munro, CGA, CIRP NB

Nancy Snedden, CA, CIRP NL

° Hon. Yoine Goldstein, B.A., B.C.L. (Hons.),

D.E.C.D., D.de l’U. (Hons.), LL.D., Ad.E QC

COMMERCIAL PROGRAM (2013) * Michelle Pickett, CFA, CIRP ON

Mark Yakabuski, BA (Hons.) ON

Amanda Bezner, CPA, CA, CIRP ON

Hartley Bricks, CPA, CA, CIRP ON

Simone Carvalho, CIRP ON

Alan Hutchens, CPA, CA, CIRP ON

Alex MacFarlane ON

Brad Newton, CPA, CA, CIRP, CBV ON

Ken Pearl, CPA, CA, CIRP ON

Jeffrey Rosenberg, CPA, CA, CIRP ON

Daniel Sobel, CIRP ON

Sharon S. Hamilton, CPA, CA, CIRP ON

COMMUNICATIONS


David Wood, CIRP BC

Guylaine Houle, BCL, FCIRP QC


Francyne Hunter, CIRP NS

Debora Kwasnicky, CIRP BC

CONTINUING EDUCATION (2013)

* Joseph Healey, CA, CIRP MB

Kimberley Burke, CIRP NS


Steven Bissell, CIRP ON

Rebecca Frederick, CIRP AB


Melinda McKie, CMA, CIRP BC

Patrick Poupart, CIRP QC

Robert Hunt, CA, CIRP NS

CORPORATE PRACTICE

* Jonathan Krieger, CPA, CA, CIRP ON

Stephen Ferguson, CPA, CA, CIRP ON

Jodat Hussain, CPA, CA, CIRP ON

Eugene P. Migus, CPA, CA, CIRP ON

Emmanuel Phaneuf, CIRP QC

Wendy Santoro, CPA, CA, CIRP ON

Stéphane Lachance, CPA, CA, CIRP QC

CIRP QUALIFICATION PROGRAM (CQP)

* Jean-Daniel Breton, CPA, CA, FCIRP QC

Virginie Comtois CPA, CA, CIRP QC

Prof. Gail Fayerman, MBA, CPA, CA QC

André Greenwood, CIRP ON

Guy Odhams, CA, CIRP AB

• Joanne S. McKee ON


DISCIPLINE

* Peter D. Wedlake, LL.B., FCIRP NS



John Bottom, CA, CIRP BC

Harold Brief, FCPA, CA, CIRP (ret.) ON

Keith W. Caverly, CIRP (ret.) ON

Robert A. Cordy, CIRP NS

Robert J. Deniset, CA, CIRP MB

Gaetano Di Guglielmo, CPA, CA, CIRP QC

Mathew M. Harris, FCA, CA, CIRP NS

Bruce Hudson, CA, CIRP AB

Richard S. Janes, CIRP NL

David A. Johnson, CGA, CIRP, CFE MB

James A. Kirby, CA, CIRP NS

Victor P. Kroeger, CA, CIRP AB

George B. Lomas, FCA, CFE, FCIRP AB

Tim Ludwig, CA, CIRP AB

Uwe Manski, FCPA, FCA, FCIRP ON

Allan D. Marshall, B.B.A., CIRP NB

Frank C. Miller, CPA, CA, CIRP ON

Lloyd W. Murphy, CA, CIRP BC

Carl M. Ritchie, CCCE, CFE, CIRP (ret.) ON

Ira Smith, MBA, CPA, CA, CIRP ON

Kenneth C. Stonley, CIRP (ret.) ON

John J. Swidler, FCA, FCIRP, BCL QC

Bryan Tannenbaum, FCPA, FCA, FCIRP ON

EDITORIAL ADVISORY BOARD

* Larry Prentice, FCA, CA, FCIRP BC



Mary Buttery, LL.B BC

Virginie Comtois, CPA, CA, CIRP QC

Richard M. Harris, FCPA, FCA, FCMC, CIRP ON

Derek Hynes ON

Jeff Lee, Q.C. SK

Sanjeev Mitra, LL.B ON

Martin Rosenthal, CPA, CA, CIRP QC

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EXECUTIVE


David Wood, CIRP BC


Anthony Tillman, CA, CIRP BC



FINANCE

* Anthony Tillman, CA, CIRP BC



André Greenwood, CIRP ON

Ali Hemani, CGA ON

John Page, FCPA, FCA, CIRP ON

HONOURS AND AWARDS NOMINATING

* George B. Lomas, FCA, CFE, FCIRP AB



Gilles Campeau, FCIRP (ret.) QC

Donna Collins, BA, B.Comm. (Hons.), FCIRP MB

William Courage, CPA, CA, FCIRP ON

C. Garth MacGirr, FCPA, CA, FCIRP (ret.) ON

J. Alan MacKinnon, FCA, FCIRP (ret) NL

Larry W. Prentice, FCA, CA, FCIRP BC


INTERVENTION

* Michael Cheevers, CA, CIRP, CBV, CFE BC


Philippe Bélanger, LL.B., BCL QC

Jean-Daniel Breton, CPA, CA, FCIRP QC

Christopher P. Galea, CPA, CA, CFE, CIRP ON

Peter D. Wedlake, LL.B., FCIRP NS

° Hon. Yoine Goldstein, B.A., B.C.L. (Hons.),


MEDIA COMMUNICATIONS

* François Noel, CIRP QC


Nathalie Brault, CPA, CMA, CIRP QC

Jean-François Cliche, CIRP QC

Michelle Grant, CIRP BC

Maryann Marriott, CIRP NS

Graham Morris ON

Matthew Munro, CGA, CIRP NB

Ashvin Sharma, CIRP ON


NEW MEMBERS

* Adam Fisher, CPA, CA, CIRP ON




Kim Burke, CIRP NS

Jean-François Cliche, CIRP QC

Jennifer McCracken, CIRP BC

Mathieu Roy, LL.B., LL.M., CIRP QC

Eric Sirrs, CIRP AB

Allen Yao, CPA, CA, CIRP ON

Gordon Boersma, CMA, CIRP MB

NOMINATING

*Paul M. Casey, CPA, CA, CIRP ON



Kevin Brennan, CA, FCIRP BC

Mark S. Rosen, BA, LL.B., FCIRP NS


PROFESSIONAL CONDUCT *Angela Karen Pollard, CMA, CFE, FCIRP ON

Russell D. Law, CA, CFE, CIRP BC


Sherri L. Aberback, CFE, CIRP QC

E. Dean Burlingham, MBA, CA, CIRP SK

Gregory Gosse, CMA, CIRP NL

Stanley Hopkins, CA, CIRP NS

Robert D. Johnson, CA, CIRP NB

Brad Milne, CIRP MB

Valerie Norrish, CIRP AB

Bruce Caplan, CIRP MB

* Chair

• Office of the Superintendent of Bankruptcy

° Outside Board member

Board of Directors Liaison

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2013-2014 TASK FORCES

ADVERTISING DIRECTIVE

* Matthew Munro, CGA, CIRP NB



Martin Clermont QC

Brian Doyle, CPA, CA, CIRP ON

Trevor Pringle, CFE, CIRP ON

Nancy Snedden, CA, CIRP NL

CONSUMER ADVOCACY

* André Bolduc, CPA, CA, CIRP ON

David Wood, CIRP BC




Leah Drewcock, CIRP BC

Debora Kwasnicky, CA, CIRP BC

Stanley Hopkins, CA, CIRP NS

CORPORATE ADVOCACY

* Mark Wentzell, LL.B., CA, CIRP BC

Michael Krieger, CIRP ON

Bryan A. Tannenbaum, FCPA, FCA, FCIRP ON

Mitchell Vininsky, CIRP ON

MANDATORY COUNSELLING

* Colleen Craig, CA, CIRP BC



Mike Braga, CIRP ON


MEDIA

* George Kinsman, CA, CIRP NS


Nathalie Brault, CPA, CMA, CIRP QC

Jeremy Kroll, CPA, CA, CIRP ON

Kenneth Robbs, BAA, CIRP ON

Sharon Stapley, CIRP AB

MOU REVISION

**Kevin Brennan, CA, FCIRP BC

**Jean-Daniel Breton, CPA, CA, FCIRP QC

Erez Cukierman, CIRP ON

Jennifer McCracken, CIRP BC

Guy Odhams, CA, CIRP BC

TARIFF REVIEW

* Virginie Comtois, CPA, CA, CIRP QC

David Wood, CIRP BC



Hon. Yoine Goldstein, B.A., B.C.L. (Hons.),


Jim Moses, CIRP AB

David Stewart ON

Peter Wedlake, FCIRP NS

Melanie Wengle, BA, LL.B., CIRP ON

Randy West, CA, CIRP BC

* Chair

** Co-Chair

• Office of the Superintendent of Bankruptcy

° Outside Board member

Board of Directors Liaison

CAIRP APPOINTMENTS TO OTHER

ORGANIZATIONS

William Alan Courage, CPA, CA, FCIRP

INSOL International, Board of Directors, Finance Committee

and Small Practice Membership Issues Committee

Robert O. Sanderson, FCA, CA, FCIRP

INSOL International, Past Presidents Advisory Committee

C. Garth MacGirr, FCPA, CA, FCIRP (ret)

INSOL International, Past Presidents Advisory Committee

Brock J. Edgar, CPA, CA, CIRP

INSOL International, Latin America Committee

Douglas R. McIntosh, CPA, CA, CIRP

INSOL International, USA/Canada Membership Development

Committee

Allan Nackan, CPA, CA, CIRP

INSOL International, INSOL Fellowship Committee

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2013-2014 COMMITTEES

THE 2013 ANNUAL CONFERENCE

ST. JOHN'S, NEWFOUNDLAND AND LABRADOR

"What a time we had at the 2013 Annual CAIRP Conference!"

More than 220 CAIRP members, presenters, and

corporate partners were treated to some of

Newfoundland's finest hospitality at the 2013 CAIRP

Annual Conference at the Sheraton Hotel Newfoundland

in St. John's, from August 15th to 17th.

Kicking off the conference was the inspiring speech by

General Rick Hillier (Ret.), former Chief of Defence

Staff for the Canadian Forces, who spoke to us about

leadership in tough times: a topic that all members can

relate to, whether they are involved with a corporate

insolvency file or a consumer debtor situation. In

attendance by special invitation were thirteen uniformed

personnel of the Canadian Forces Base-St. John's, from

various units of the army, navy and air forces, who

reminded all of us of the freedoms we enjoy today.

The keynote address was followed by Dr. Warren Jestin,

Senior Vice-President and Chief Economist of

Scotiabank, who presented us with a global and national

economic update. We were then brought up to date on

some international insolvency activities through an

informative presentation by James Sprayregen, President

of INSOL International.

The technical program was structured so that four

breakout sessions were geared to the consumer

practitioner, and another four to the corporate

practitioner. We were successful in obtaining some very

talented and interesting speakers to discuss current hot

topics, and thanks to all of you.

Our final plenary session, about the future of our

industry, was presented by William Courage, Jean-

Daniel Breton and Paul Casey, three of our senior

association members, and what a session it was. The

"boys" did a superior job in attempting to look into the

crystal ball and see where we as an association (and

profession) are headed. It is fair to say that delegates

went away with considerable food for thought; wow!

Although a representative from the Office of the

Superintendent of Bankruptcy was not able to attend this

year's conference, CAIRP appreciates the strong

participation of the OSB in the 2013 Forums this past

spring, and looks forward to welcoming the

Superintendent to the 2014 Annual Conference in

Ottawa.

There were annual general meetings for the CIF and

CAIRP, and a presentation by Guylaine Houle, outgoing

Chair of our Association, outlining the highlights and

activities of the past year.

Wrapping up the conference was the Chair's banquet

dinner and dance, which included remarks from the

incoming Chair, Paul Casey, on the initiatives and future

plans of the Association.

Our social program was second to none, including a

welcome reception on the opening night, and fun and

informative afternoon activities that were enjoyed by all:

golf on two separate courses, a Signal Hill and Cape

Spear tour, and a birds and whales boat tour. And on

Friday evening, all were on hand for the "Rally in the

Ally" George Street Pub Crawl: a night that will be

forever remembered!

Many, many thanks go to our corporate partners, without

whose financial support we would not be able to do

everything that we were able to do: THANK YOU.

To everyone who attended the conference, thank you for

your participation, for we could not have done it without

you, either.

Last but not least, thank you very much to all the 2013

Annual Conference Committee members: Chantal

Gingras, Noel Andrews, Greg Gosse, Nancy Snedden,

Mark Yakabuski, Bea Casey, Ali Hemani, and my

"right hand" event planner, Emma Flood. A special

thanks also goes to Adam Hutchens, our golf coordinator.

Thanks a million for all of your support and assistance.

As Chair, I had a blast hosting the 2013 Conference.

Again, many thanks to everyone who attended and made

it the success that it was. Derrick J. Hutchens, CIRP


Chair

9

COMMERCIAL PROGRAM

The 10th

annual Commercial Insolvency and

Restructuring program was held on March 27, 2014 at

the Toronto Region Board of Trade. The program was

sold out with record attendance, a testament to the quality

and value provided by this annual event in terms of

professional development and networking opportunities.

In recognition of the 10th

anniversary of the Commercial

program, attendees received a commemorative pen.

Former Chairs of the Commercial Program committee

were invited to attend the event as guests and were

acknowledged and thanked for their contribution to the

success of the Commercial Program.

Prior to the start of the program and during breaks,

congratulatory quotes and support from former Chairs

and sponsors of the 2014 Commercial Program appeared

on screens throughout the room.

We were fortunate to have two keynote speakers at this

year’s Commercial Program. Bill Aziz, President, Blue

Tree Advisors, started the day with his thought-

provoking views on current issues and trends in

restructuring. Benjamin Tal, Deputy Chief Economist,

CIBC World Markets, provided an entertaining economic

overview and forecast for the Canadian and European

economies.

In addition to the keynote speakers, there were four panel

presentations this year. Brent Houlden (Deloitte)

moderated an Industry Panel on Retail, with Ken Jones

(Dean Emeritus, Ted Rogers School of Management at

Ryerson University), Craig Gilpin (The North West

Company) and Brett Miller (Jones Lang LaSalle)

discussing the changes taking place in Canadian retail.

Pamela Huff (Blakes) moderated a panel of judges

including Regional Senior Justice Geoffrey Morawetz,

Justice David Brown, Justice Herman Wilton-Siegal of

the Ontario Superior Court and Justice Mark Schrager of

the Quebec Superior Court that discussed the role of the

court officer, potential conflicts of interest and

recommended improvements to court reports.

Ryan Adlington (KPMG) moderated two mock pitches

to a panel of lenders. The team of Toni Vanderlann

(FTI) and Robb English (A&B) fought hard to convince

the lenders that a Court Appointed Receivership was the

best solution to address a multitude of company issues

and maximize recoveries for the lending syndicate.

Ultimately, the lender panel supported the CCAA

restructuring solution presented by Leanne William

(TGF) and Alex Morrison (EY) as the preferred means

of restructuring the business. The panel’s analysis of the

situation and key considerations in their decision to

support a CCAA filing was enlightening to all.

The final session, moderated by Shayne Kukulowicz

(Cassels Brock & Blackwell), discussed recent

developments in the area of construction liens and

director liabilities emanating from the Comstock Canada

and Northstar Aerospace proceedings. Panelists Harvey

Chaiton (Chaitons), Robin Schwill (Davies), Craig Hill

(BLG) and Paul Guy (Weirfoulds) provided their inside

perspectives on the key Court decisions stemming from

these cases and the impact of these decisions on future

restructuring files.

This year’s Committee included the following highly

focused and committed volunteers: Alex MacFarlane

(Gowlings), Brad Newton (KPMG), Hartley Bricks

(Deloitte), Ken Pearl (BDO), Jeffrey Rosenberg, (FTI),

Amanda Bezner, (Duff & Phelps), Simone Carvalho

(EY), Al Hutchens (A&M) and Daniel Sobel (GT). As

CAIRP Board Liaison, Sharon Hamilton (EY) provided

invaluable assistance throughout planning and

implementation. I wish to thank all the members of this

Committee for their hard work, focus and dedication,

making this a very successful program.

I would like to take this opportunity to also thank our

many sponsors, who contributed significantly to the

program`s financial success. Our law firm sponsors

included Aird & Berlis, Borden Ladner Gervais, Blake

Cassels & Graydon, Cassels Brock, Chaitons LLP,

Davies Ward Phillips & Vineberg, Dentons, Dickinson

Wright, Gowlings Lafleur Henderson, Lenczer Slaght,

McMillan, Miller Thompson, Minden Gross, and

Thornton Grout Finnigan. Trustee firms sponsoring the

event included Alvarez & Marsal, BDO Canada Limited,

Deloitte Restructuring Inc., Duff & Phelps, Ernst &

Young, Farber Financial Group, FTI Consulting, Grant

Thornton, KPMG, PwC and Richter.

Finally, I would like to extend my thanks to CAIRP staff

for their ongoing support throughout the process.

Michelle Pickett, CFA, CIRP


Chair

10

CONTINUING EDUCATION

The Continuing Education Committee is responsible for

planning and delivering the annual spring “roadshow” of

CAIRP Forums across the country. Each year, these

Forums are attended by the majority of our members, and

for many of you, represents the main “touch point”

between CAIRP members and the Association.

Forums were held in Vancouver, Calgary, Winnipeg,

Toronto, Montreal and Halifax during the month of May.

As always, they provided a valuable professional

development opportunity for CAIRP members practising

principally in mid-market commercial and consumer

insolvency practices. This year’s attendees hopefully

noticed a deliberate and conscious effort by the

committee to deliver content and sessions squarely

focused in this area – we have listened and responded to

your feedback.

The Continuing Education Committee is very active from

September to May, and comprises a number of dedicated

and highly committed CAIRP volunteers who invest

significant time and effort to the development of the

profession. Our aim is to ensure that the programs

presented across the country are relevant, engaging and

of high quality.

Committee members, from different geographic regions

and practice types, included Kimberley Burke, BDO

Canada Ltd. (NS) (Vice Chair), Patrick Poupart,

Poupart Syndic Inc. (QC), Steve Bissell, FTI Consulting

Canada Inc. (ON), Sandra Sykora and Julie Wildman,

Hoyes Michalos & Associates Inc. (ON), Jennifer Kelly,

Pinder, Bueckert & Associates Inc. (SK), Rebecca

Frederick, Frederick & Company Ltd. (AB), and

Melinda McKie, Deloitte Restructuring Inc. (BC).

Robert Hunt, as CAIRP Board Liaison, was very active

in our planning sessions and provided invaluable

assistance throughout the process.

Three years marks a trend that hopefully turns into a

staple for future Forums. Each city hosted a New

Members Breakfast targeted toward students and CAIRP

members with five years or less experience. Experienced

volunteers in each city discussed the “Future of the

Profession”, a roundtable discussion on themes and

trends that will be experienced by these members as they

progress in their careers, and how they can play a role in

shaping the future of CAIRP – a worthwhile endeavour

indeed!

The main program for the Forums kicked off with

updates from either the chair or vice chair of CAIRP. In

addition, we were pleased to receive updates from the

Office of the Superintendent of Bankruptcy at each of the

Forums.

The 2013-2014 Forum saw the return of breakout

sessions for those practicing in either consumer or mid-

market commercial matters. The consumer breakout

session focused on hot topics of interest (individual

topics varied by region based on provincial board

feedback), while the corporate session dealt with

refinancing of distressed businesses.

Preet Banerjee provided the keynote luncheon address,

and spoke of his research into why people are “hard-

wired” to make bad money decisions. It was an engaging

and thought-provoking session that brought some insight

into the behaviour and thinking of persons facing

financial difficulties.

This year, the committee introduced the use of live

polling technology in an interactive session that delved

into ethics and professionalism. The presenters made

excellent use of case studies and scenarios gleaned from

issues often encountered by the professional conduct

committee.

Finally (and certainly not least), the Forum covered the

legal technical updates for both commercial and

consumer insolvency issues that our audiences are keen

to hear annually.

Your Continuing Education Committee wants to hear

from you – what topics and/or speakers would be

interesting? We will commence the planning process for

2014-15 in early September, and any feedback will be

warmly received.

My personal and sincere thanks go out to the many

people who worked to make the 2013-2014 Forums an

outstanding success. First, I wish to thank all the

members of the Committee for their hard work and

tireless effort to ensure the success of the Program. I

would also like to acknowledge the outstanding

dedication of speakers and panel members for their

commitment to the education of our members. Finally, I

want to thank CAIRP staff (particularly Bea Casey) and

Emma Flood of Base Consulting for their support

throughout the year.

Joe Healey, CA, CIRP


Chair

11

CIRP QUALIFICATION PROGRAM

The CIRP Qualification Program (“CQP” or

“Program”) is CAIRP’s educational program leading to

the certification of individuals as chartered insolvency

and restructuring professionals. Pursuant to a

memorandum of understanding (“MOU”) with the Office

of the Superintendent of Bankruptcy (“OSB”), the CQP

is also the program recognized and accepted by the OSB

as a prerequisite (save for exceptional circumstances) to

obtaining a licence as a trustee in bankruptcy.

The CQP is managed and developed through a series of

interrelated, coordinated, collaborating committees,

subcommittees and task forces. During CAIRP’s fiscal

year ended March 31, 2014, the committees and

subcommittees and their principal mandates included:

The CQP Committee (“CQPC”) (chaired by Jean-

Daniel Breton of Ernst & Young Inc.): The CQPC is

a small committee of 5 regular members and one

representative from the OSB sitting as an ex-officio

member. Its mandate is to supervise the CQP and

provide overall leadership and direction to the

program.

The Course Material Review Committee (“CMRC”)

(chaired by Brenda Wood of BDO Canada Ltd.):

The CMRC is charged with reviewing the existing

course material and developing new material to

ensure that the prescribed course of study remains

relevant, accurate and complete.

The Exam Oversight Committee (“EOC”) (chaired

by Catherine Hristow of Deloitte Restructuring Inc.

until the Fall of 2013 and currently chaired by Carol

McGran of Ernst &Young Inc.): The EOC is

charged with setting the examination standards and

reviewing and approving the proposed examinations

drafted by two examination committees, namely:

o The Competency based National Insolvency

Examination for CIRPs Board (the “CNIE”

Board) (chaired by Carol McGran of Ernst &

Young Inc. until the Fall of 2013 and currently

chaired by John Delo of Paddon & Yorke Inc.):

The CNIE Board is responsible for developing the

annual national insolvency examination that seeks

to assess the candidates’ competencies, to prepare

assessment guidelines and manage the

examination and assessment process.

o The Core Knowledge Examination (“CKE”)

Committee (chaired by Michael Braga of BDO

Canada Ltd.): The CKE Committee is responsible

to develop examinations, to be held twice per year

for candidates enrolled in the CKE who want to

progress to the Advanced Knowledge Course.

The Exam Appeal Committee (co-chaired by

Catherine Hristow of Deloitte Restructuring Inc. and

Carol McGran of Ernst & Young Inc.): The Exam

Appeal Committee is formed on an ad hoc basis to

create an appeal board made up of people who are

different from the original assessors, but supervised

by people drawn from the EOC, as the members of

the EOC have an in depth familiarity with the exam

setting and assessment processes.

In addition to the prime responsibilities that are outlined

above, the various committees and subcommittees

undertook the following significant projects, either as

part of the regular committee business or through task

forces:

1. Developing a Sponsor’s manual to assist sponsors in

their task of mentoring and guiding candidates

through the program.

2. Developing a mini assessment process to help

candidates and sponsors gauge their level of

preparedness before registering to challenge the

CNIE. The task force charged with this initiative had

to develop examination questions that are consistent

with the type of questions asked of candidates at the

CNIE and that address several key competencies,

develop an assessment guide to evaluate the various

competencies tested in the examination questions,

design a feedback process to provide information to

the candidates on their performance on each of the

key competencies tested, organize an assessment

center to evaluate the papers submitted by candidates,

and coordinate the issuance of individualized

feedback reports to the candidates within days after

the marking center, to allow the candidates and the

sponsors an opportunity to decide by themselves if

the candidates are ready or not to challenge the CNIE.

Although the examination material was distributed to

candidates who registered for the mini-assessment

without restriction, the candidates were encouraged to

answer the assessment questions under exam

conditions. The first mini-assessment was sent to

candidates during the month of April 2014 and the

assessment center was held in mid June 2014.

3. Reviewing the MOU. The current MOU was entered

into in October 2009 and provides for a periodic

review (although it also provides flexibility to make

changes during the term of the MOU, if required). A

task force was struck, chaired by Jean-Daniel Breton

of Ernst & Young Inc., to review the MOU and make

recommendations, as the case may be, on changes

that could be implemented.

12

4. Reviewing the experience requirement of the

program. The CQP requires that candidates follow a

prescribed course of study and acquire relevant

experience before challenging the CNIE. The

acquisition of experience is monitored through a

requirement to report on hours spent in fulfilling

relevant tasks related to a restructuring and

insolvency practice, and by a confirmation from the

sponsor that the candidate has acquired the necessary

experience background expected of an entry level

CIRP. It was recognized that the demands of the

workplace, the type of practice in which a candidate

works and the economy can cause a disparity between

the types of experience acquired by each candidate.

Further, different sponsors may not assess the

experience requirements in the same manner. A task

force was struck to review the continued relevance of

the experience hours report and to consider ways to

assist the candidates and sponsors in supplementing

the experience acquired in the workplace through

networking or other similar activities that would

facilitate the communication of experience across

practice areas.

5. Arranging for an annual tutorial session to prepare

candidates for the CNIE. The exam preparation

material was markedly enhanced for the 2013 tutorial.

One session dedicated to exam writing was increased

in length from half a day to one and a half days to

allow candidates to gauge answers of varying quality

on a competency scale and practice completing

competency-based assessment questions.

6. Revising the assignments used in the Introductory

Course, the Core Knowledge Course and the

Advanced Knowledge Course, to move away from

strictly knowledge based assignments, towards a

more competency based approach.

7. Revising the Insolvency Administrators’ Course

material. Although not specifically part of the CQP, it

was recognized that the Insolvency Administrators’

course sometimes serves as a first step towards

gaining familiarity with the Program, and that it

would be preferable that the didactic material offered

to technicians employed by CAIRP members be

consistent with the material used in the CQP. As a

result, a task force was struck from members of the

CMRC to revise and update the course and

assessment materials offered to the Insolvency

Administrators.

The above represents only the principal projects and

tasks carried out by the various committees that manage

the CQP. The Program is a complex machine that is

constantly in motion, through the dedicated work of

CAIRP staff and countless volunteer members. There

were more than 115 volunteers, members of CAIRP,

employees of the OSB or attorneys, that were directly

involved with the Program, either as a member of a

committee, subcommittee, task force or a participant in

an assessment center or tutorial directly aimed at

candidates in the Program. Many other volunteers helped

on an ad hoc basis with specific requests or by providing

feedback on the Program so that it could be enhanced, in

real time. In view of the number of people involved, it is

impossible to acknowledge them all in this short report

on activities, but they can rest assured that their

contribution is noticed and very much appreciated.

Finally, I would like to express my thanks to the tireless

CAIRP staff, and in particular Bea Casey, Isabelle

Gauthier and Renzo Libaque, for their ongoing support

and dedication in managing and further developing the

Program.

Jean-Daniel Breton CPA, CA, FCIRP

Fellow Chartered Insolvency and Restructuring

Professional, Chair

EDITORIAL ADVISORY BOARD

The Editorial Advisory Board is responsible for

generating the technical and editorial content of CAIRP’s

official magazine, Rebuilding Success. Since its

beginnings in 2002, Rebuilding Success has steadily

evolved into a substantial publication addressing a broad

spectrum of situations that impact stakeholders in the

insolvency and restructuring community across Canada.

In addition to members of CAIRP, the magazine is

distributed to approximately 2,800 other professionals:

lawyers, lenders, regulators and academics who work in

Canada’s insolvency and restructuring system.

The magazine is published twice a year. This year’s

issues discussed important legal decisions in prominent

insolvencies such as Indalex, Montréal, Main & Atlantic

Canada Co. and AbitibiBowater Inc., as well as more

human topics such as the rise of insolvency amongst

seniors and dealing with people employed by companies

going through insolvency proceedings. Other articles

included reviews of the economic prospects for Canada

and other countries around the world, insolvency related

developments at the World Bank, and jurisdictional

differences that could impact the outcomes in seeking

court approval of sales by receivers.

13

The magazine also provided profiles of prominent

members of the insolvency community across the

country. The Fall 2013 issue profiled incoming CAIRP

Chair Paul Casey and Bill James, recently confirmed as

the new Superintendent of Bankruptcy. Our Spring 2014

edition featured Justice Juliana Topolniski of the Alberta

Court of Queen’s Bench, and her progression from

aspiring nurse to one of her city’s top insolvency

lawyers. Each issue also featured profiles of CIRPs

active in their communities.

Rebuilding Success is made possible by the support of its

advertisers. We greatly appreciate the increasing number

of insolvency and restructuring practices, law firms and

other service providers who use the magazine to reach

the Canadian marketplace and publicize their services.

The Editorial Advisory Board represents a variety of

perspectives on insolvency and restructuring matters

from across the country. CAIRP members Martin

Rosenthal (Ernst & Young Inc.), Richard Harris

(KPMG LLP) and Virginie Comtois (Raymond Chabot

Inc.), banker Derek Hynes (Bank of Montreal), and

insolvency lawyers Mary Buttery (Davis LLP), Jeff Lee

(MacPherson Leslie & Tyerman LLP) and Sanjeev

Mitra (Aird & Berlis LLP) each contributed

substantially to the development of topics and authors for

the magazine’s editorial content this year. The Board also

benefited greatly from the contributions of Mark

Yakabuski and the editing work of our consultant,

Natalie Richard. I would like to extend my sincere

appreciation to all of these individuals for their

contributions to the magazines produced this year.

Larry Prentice, FCA, CA, FCIRP


Professional, Chair

FINANCE

We are pleased to report that the Finance function

continues to run very effectively under our Director of

Finance, Ali R. Hemani, CA, CGA, ACCA (UK). Mr.

Hemani has continued to refine and integrate our internal

reporting function and we have a timely reporting system

in place, with monthly financial statements prepared for

review by the Finance Committee, and quarterly reports

prepared for the Board of Directors.

In March 2014, the Board approved the Association’s

budget for Fiscal 2015. The budget was prepared with

input from the Finance Committee and the CQP

Committee.

The Treasurer’s report for the year ended March 31, 2014

indicates a successful break-even year financially, in

large part driven by a reduced number of articling

members participating in and completing the CQP after

significant surpluses in prior years driven by higher

numbers of students moving through the program. No

changes were made to our internally restricted equity

allocation of $1.0 million to fund maintenance and

review of the CQP, Insolvency Counsellor’s

Qualification Program, and Insolvency Administration

Course over the coming years.

No changes were made to our investment portfolio in

fiscal 2014 as we continue to hold approximately $1.2

million of Canadian provincial government bonds with

maturities ranging from 2016 to 2024.

The Finance Committee is comprised of Anthony

Tillman, Chair, Paul Casey, Ali Hemani, André

Greenwood, John Page and Mark Yakabuski. The

Chair thanks Ali Hemani and the members of the

Finance Committee for their time, effort and input during

the year.



Chair

HONOURS & AWARDS NOMINATING COMMITIEE

The Committee met several times during the year to

consider nominations for the various awards granted

by CAIRP.

To ensure orderly transition and renewal of the

Committee, two new members, Guylaine Houle,

FCIRP and Bill Courage, FCIRP, joined the

Committee.

The Committee also established the criteria for the

New Member Award of Merit which is posted on the

CAIRP's website.

We received numerous nominations for the Keith G.

Collins Award, the Outstanding Volunteer Award

and the New Members’ Award of Merit.

14

The Committee recommended and the Board approved

the following Awards:

Keith G. Collins Award:

Carl Ritchie, CIRP (ret), Toronto (msi

Spergel inc.)

Andrea Yandreski, CIRP, Toronto (Alvarez

& Marsal Canada ULC)

Outstanding Volunteer Award:

Carol McGran, CIRP, (Ernst & Young)

Lynn DeLaBarre, CIRP (sole practitioner)

Brenda M. Wood, CIRP (Paddon & Yorke

Inc.)

New Members’ Award of Merit:

Eric Sirrs, CIRP (MNP Ltd.)

We encourage all members to review the particular

criteria for each award on the CAIRP website and to

nominate their peers. Recognition of significant

contributions by members is vital to ensuring the

success of the Volunteers Association.

In conclusion, I would like to thank the members of

the Committee - Alan MacKinnon, St. John’s;

Gilles Campeau and Guylaine Houle, Montreal;

Garth MacGirr, Toronto; Bill Courage, Owen

Sound; Donna Collins, Winnipeg; Larry Prentice,

Vancouver; and Board Liaison lan Penney, St.

John’s. I also want to thank the administrative team

at the Association for all of their assistance during

the past year.

George Lomas, FCA, CFE, FCIRP


Professional, Chair

INTERVENTION

The Intervention Committee has reviewed a number of

significant cases over the past year.

In the matter of Brisebois v. QRA, a class action was

authorized by the Quebec Superior Court in a matter of

some interest to all trustees who deal with consumer

proposals. Brisebois had made a proposal, subsequently

amended and accepted by the creditors, which included a

debt owing to QRA in the amount of $10,292.33. The

proposal included an arrangement with QRA for the

payment of the fiscal debt over five (5) years. QRA voted

against the proposal, but was bound by it since the

statutory majority of creditors approved the proposal and

the proposal was ratified by the Court.

Notwithstanding the binding nature of the proposal, QRA

proceeded to apply reimbursements due to the debtor in

subsequent tax years, to accelerate payment to itself.

Apparently this procedure is fairly endemic in Quebec.

Accordingly, the Court granted permission to initiate a

class action.

The Intervention Committee determined that, although

the matter presented a significant interest to the trustees,

an intervention by CAIRP would not be received by the

Court at this stage of the proceedings. It was decided that

a watching brief would be held by CAIRP.

A bulletin alerting CAIRP members to the class action

was sent on March 10, 2014.

The Committee considered the consequences of the

Timminco decision rendered by Mr. Justice Mongeon

which, essentially, allowed the provisions of the Quebec

Supplementary Pensions Plans, which creates a statutory

trust over all assets of the debtor, to rank prior to the

secured creditor. Mr. Justice Mongeon, in rendering his

decision, recognized that he had effectively reversed a

previous decision rendered by him and offered a rather

doubtful explanation for the reversal. The Committee

considered whether it was useful to intervene, but

Investissements Québec, the secured creditor in this case,

had made an application for leave to appeal and it was

determined to await the result of this application before

taking any further steps.

Two judgments of the Court of Appeal of Alberta and

Ontario, respectively, asserted that it was contrary to the

“fresh start” principle to refuse to grant an operating

permit to a driver who, in one case, had a debt due to an

injured party discharged by the discharge from

bankruptcy and, in another case, had a debt due to the

Public Private Consortium operating the toll road, 407,

unless the drivers paid the charged debt. Leave to appeal

had already been granted in one case and an application

for leave to appeal was pending in the other case. The

likelihood was that the second application for leave to

appeal would be granted and the two cases would then be

joined for hearing before the Supreme Court. The issue

was whether the principle of a “fresh start” was of a

nature that would grant the BIA paramountcy over

provincial legislation dealing with refusal of drivers’

permits. The matter was considered by the Committee to

be significant.

15

Subsequent to the year-end, the Superintendent of

Bankruptcy requested that CAIRP intervene in the case.

Accordingly, at the Board of Directors Meeting on May

23, the Directors authorized an intervention by CAIRP.

The Committee is comprised of members who have

significant experience and expertise to call upon in

reviewing requests for intervention. They are Philippe

Bélanger, Jean-Daniel Breton, Christopher Galea,

Hon. Yoine Goldstein and Peter Wedlake.

Michael T. Cheevers, CPA, CA, CIRP, CBV, CFE


Chair

NEW MEMBERS

The New Members’ Committee (“NMC”) is composed

of nine members from across Canada with experience in

both corporate and consumer insolvency who have

obtained the CIRP designation within the past five years:

Adam Fisher (Harris & Partners Inc.) as Chair, Eric

Sirrs (MNP Ltd.) as Vice-Chair, Kimberley Burke

(BDO Canada Limited), Jean-François Cliche (Cliche

Madore Syndic), Jennifer McCracken (Campbell,

Saunders Ltd.), Mathieu Roy (Pierre Roy & Associés

Inc.), Allen Yao (Ernst & Young Inc.), Gord Boersma

(MNP Ltd.) as Board Liaison and Guylaine Houle

(Pierre Roy & Associés Inc.) as Past Chair.

The NMC has been very active in achieving its various

initiatives set out in its January 2014 Action Plan (the

“NMC Action Plan”). To develop the NMC Action Plan,

the NMC considered CAIRP’s vision that “CAIRP

members are recognized leaders in providing solutions to

financially challenged individuals and businesses and are

the Go-To Professionals for expertise, information and

solutions regarding insolvency and restructuring”, and

the three pillars that are the foundation of our

professional association: Professional Recognition,

Education and Advocacy. The NMC also considered the

special section on Volunteers in CAIRP 2012 Strategic

Plan, to highlight the fact that key goals cannot be

achieved without taking steps to increase the number and

effectiveness of volunteers throughout CAIRP.

This year, the NMC’s focus was professional recognition

and volunteerism. Some of the key initiatives of the

NMC Action Plan include:

Professional Recognition and Volunteerism

Support the overhaul of CAIRP’s website and

provide feedback to the Media Communications

a Committee with respect to the section on

“How to become a trustee/administrator”;

Promote CAIRP brand awareness at universities

in major Canadian cities through CAIRP’s

attendance at career and designation days;

Promote volunteerism and general involvement

by new members, with a campaign to recruit

members that obtained their CIRP memberships

in 2014. The NMC organized two events: a

new CIRPs’ celebration party on June 11, 2014

and a New Members’ breakfast at each CAIRP

Forum.

Encourage new members to attend CAIRP’s

annual conference and work to increase overall

attendance by new members at CAIRP events;

Increase volunteerism of new members by

promoting CAIRP committees and task forces

and through representation of new members on

them.

Education

As an independent committee, help the CQP

committee improve the CQP process for the

2013 round of examinations. In particular, the

NMC attended the CQP tutorial in Ottawa to

promote the opportunity to volunteer once the

CIRP is achieved and to provide assistance to

the CQP candidates in a mentoring capacity.

Advocacy

The NMC had the opportunity to meet with the

OSB’s Executive Committee in September 2013

to discuss various topics of interest to trustees

and the OSB. The meeting was insightful and

extremely valuable, as it enabled participants to

share their perspectives, ideas and opinions on

topics of importance to the profession. The

following topics were discussed:

Update on the NMC Action Plan and

its coming initiatives;

Discussion on the updated process and

initiatives with respect to the 2014 oral

boards;

Feedback and discussion on important

issues relating to Canada Revenue

Agency.

Treatment of post-filing interest in

CCAA proceedings

In addition, the NMC provided comments on

CAIRP’s draft submission on allowances and

interim draws and reviewed the compilation of

the Standards of Professional Practice into a

single document.

The NMC would like to thank Paul Casey, past-Chair

Guylaine Houle and Mark Yakabuski for their support

16

and for making the NMC an important part of the CAIRP

initiative.

In order for the NMC to keep achieving its objectives,

assistance from new members (members that have joined

the Association during the past five years) will be

necessary. If you are a new member and interested in

getting involved with the NMC or CAIRP’s various

projects, please contact NMC’s incoming Chair, Jennifer

McCracken, at [email protected].

Adam Fisher, CPA, CA, CIRP


Chair

PROFESSIONAL CONDUCT

The Professional Conduct Committee (“PCC”) has

continued to focus its energies on dealing with

outstanding complaints in a timely fashion. During this

fiscal year, the PCC has closed a number of outstanding

investigations. The number of new complaints has risen

from last fiscal year; however, the overall number of

outstanding complaints remains relatively flat, on a

month-to-month basis.

The PCC continues to focus on ensuring that a fair

investigation is completed, and that investigators discuss

the complaint with all parties and report to the PCC with

all relevant details. The PCC spends a significant amount

of time reviewing in detail the reports of the

investigators. The PCC provides to all parties a detailed

summary of its findings and comprehensive decisions

and reasons. This ensures a transparent approach for all

parties involved.

The PCC meets on a regular basis and follows a meeting

schedule to ensure that all members can allocate

sufficient time to the meeting agenda, pre-meeting

preparation and review of the material being discussed.

In addition, the PCC has continued its recent practice of

having one full-day meeting during the year to deal with

the more difficult/complex investigations in order to

ensure that sufficient time is allocated to discuss the

issues.

The PCC relies heavily upon volunteers to investigate the

complaints filed, prepare reports and meet with the

complainants and members. These volunteers have the

unenvied task of gathering the facts surrounding a

complaint as well as meeting with the parties involved.

The investigators have advised the PCC that they enjoy

the challenge involved in gathering the information and

preparing reports for the PCC. This process also provides

insight into the type of issues that give rise to complaints.

All of our members are indebted to these volunteers, as

without the investigators we would be unable to fulfill

our mandate and therefore unable to demonstrate our

ability to self-regulate in a fair and equitable fashion.

Given that the number of complaints against our

members increased in 2013-2014, the PCC requested the

services of additional volunteers to investigate

complaints. The PCC is always in need of new

volunteers. The PCC continues to complete the

investigations and report to all of the parties involved in

as timely a fashion as possible, given the time constraints

of its volunteers, including the committee members.

The PCC continues to deal with compliance issues in

reference to Directive 29R2 on advertising. The number

of complaints has dropped significantly and the PCC is

very pleased with the results and the response from the

majority of our members who have changed their

advertising in order to comply with the Directive. We

must all remind ourselves that it is very important that

advertising is not misleading to the public, and the

Committee thanks those members who have co-operated

with the PCC.

I would like to thank the Committee members for all of

their hard work during the year. The Committee

members are Russell Law (Vice-Chair), Dean

Burlingham, Sheri Aberback, Valerie Norrish,

Gregory Gosse, Brad Milne, Darryl Haley (replaced

by Stan Hopkins in January 2014), Robert Johnson,

and David Johnson (Board Liaison; replaced by Bruce

Caplan in August 2013). As well, without the support

provided by past CAIRP staff members Evelina

Solarska-Rowley and Maha Hassan, the PCC would

not be able to function. We thank them all for their

dedicated service to the Committee.

As Chair of the PCC, it has been my pleasure to assist

our Association, and I again thank those members who

have volunteered during the year to investigate

complaints.

Angela K. Pollard, CMA, CFE, FCIRP

Fellow Chartered Insolvency and

RestructuringProfessional, Chair

17

2013-2014 TASK FORCES

ADVERTISING DIRECTIVE TASK FORCE

The Advertising Directive Task Force (“TF”) was created

in the Fall of 2013 in order to further the work done in

the prior year by the Name Review Task Force. The TF’s

mandate was to come up with options to address the

concern expressed by many members that the

requirement to use the term “Trustee in Bankruptcy” in

advertising trustee services is undermining the

competitive position of trustees in the face of rising

competition from alternate providers of debt relief

services.

The TF submitted a number of suggestions to CAIRP’s

Executive Committee in early 2014 and these

suggestions were the foundation of the Advertising

Directive Survey that was sent out to members in the

Spring.

I would like to thank the members of the Advertising

Directive Task Force for their time and commitment:

Brian Doyle, Nancy Snedden, Martin Clermont,

Trevor Pringle and Vanessa Allen (formerly Grant). It

was a challenging task to review the current Advertising

Directive and to develop recommendations for changes

to the existing Directive that would take into

consideration the concerns of the majority of CAIRP

members and the Office of the Superintendent of

Bankruptcy.

I want to express my special appreciation to Mark

Yakabuski for all his assistance, support and insight.

Matthew Munro, CGA, CIRP


Chair

CONSUMER ADVOCACY TASK FORCE

The Consumer Advocacy Task Force has met regularly

over the course of the year to identify the consumer

priorities issues that need to be developed in preparation

for the 2014 legislative review of insolvency legislation.

In particular the Task Force examined: (i) issues which

CAIRP had put forward in preparation for the 2009

amendments which were not accepted and whether those

issues are still relevant areas for reform; (ii) those aspects

of the 2009 reforms which may not have worked

according to expectations and which need to be modified

or adjusted in some fashion; and, (iii) any new issues

which have arisen since the 2009 reforms which need to

be addressed in order to ensure an effective, fair and

transparent insolvency and restructuring system.

On March 16, 2014 Industry Canada launched a public

consultation on the Bankruptcy and Insolvency Act

(BIA) and the Companies’ Creditors Arrangement Act

(CCAA) and asked for submission from the public and

stakeholders. Since then, the Consumer Advocacy Task

Force has been hard at work drafting a response to the

Industry Canada discussion paper which is due July 15,

2014.

I wish to thank all the members of the Task Force and

look forward to its final report. The Consumer Advocacy

Task Force is comprised of following CAIRP members:

Leah Drewcock, Chantal Gingras, Stanley Hopkins,

past-Chair Guylaine Houle, Debora Kwasnicky, David

Wood, together with Susan Burns of the law firm Miles

Davidson LLP.

André Bolduc, CPA, CA, CIRP

Chartered Insolvency and Restructuring

Professional,Chair

CORPORATE PRACTICE COMMITTEE AND CORPORATE ADVOCACY TASK FORCE

The Corporate Practice Committee (“CPC”) is a standing

committee of CAIRP whose interest is to represent

members of CAIRP who practice in corporate

restructuring and insolvency firms. Its primary role is to:

advance educational excellence and professional

consistency;

promote recognition of the value of the CIRP

certification; and

reinforce the Vision and Value statements of

CAIRP.

The Corporate Advocacy Task Force (“CATF”) was

created in 2013 with a mandate to review and report to

the Board in respect of proposed corporate legislative

changes in light of the five-year legislated review of the

Bankruptcy and Insolvency Act (“BIA”) and the

Companies’ Creditors Arrangement Act (“CCAA”). The

CATF is working collectively with the CPC. The CPC is

comprised of six volunteer CAIRP members from

various larger insolvency firms and geographical

locations across Canada. The CATF has four volunteer

CAIRP Members.

18

The two groups have been working together since the

CATF was established in order to draw on as much

expertise as possible within CAIRP to analyse and

review corporate reform issues. After several months of

effort, they presented a preliminary list of corporate

topics for legislative review in June 2013 to a joint

meeting of Industry Canada and the Office of the

Superintendent of Bankruptcy.

In the third quarter of 2013, the CPC and CATF worked

to update the preliminary topics (and consider additional

topics), in conjunction with requests for further detail

from Industry Canada. The groups then prepared for the

eventual release of a discussion paper by Industry

Canada on the five-year review of the BIA and CCAA.

After much anticipation, the discussion paper was finally

released in May and CAIRP members were invited to

provide comments on the issues raised in the paper.

In January 2014, the CPC and CATF formed a Joint Task

Force with the Insolvency Institute of Canada (“IIC”) to

further identify issues and develop a common response to

the discussion paper. While CAIRP’s treatment of

corporate topics will largely be the same as that of the

IIC (there may be other issues raised by CAIRP), our

discussion of corporate issues will be combined with the

recommendations of our Consumer Advocacy Task

Force and submitted as CAIRP’s distinctive response to

Industry Canada’s discussion paper by the July 15th

deadline. CAIRP will make separate representations on

all legislative reform issues once the Minister of

Industry’s report on the BIA and CCAA is tabled in

Parliament in September 2014 and subsequently referred

to a parliamentary committee for study.

We would like to thank the respective members of the

CPC and CATF who have given so much of their time

and energy to making sure that CAIRP makes an

outstanding contribution to legislative reform

discussions:

CPC

Emmanuel Phaneuf, Eugene Migus, Stephen

Ferguson, Jodat Hossein, and Wendy Santoro

CATF

Mitch Vininsky, Bryan Tannenbaum and Michael

Krieger

We would also like to extend our appreciation to Jean-

Daniel Breton, who has been a leading member of the

Joint Task Force with the IIC, for his great investment of

time and insight in advancing our response to the

discussion paper.

Jonathan Krieger, CPA, CA, CIRP

Chartered Insolvency and Restructuring Professional

Chair, CPC

Mark Wentzell, LL.B, CA, CIRP


Professional

Chair, CATF

MANDATORY COUNSELLING

The Task Force was established in the Fall of 2013 in

response to preliminary ideas shared with CAIRP by the

Office of the Superintendent of Bankruptcy (“OSB”) on

improving the current system of mandatory counselling

for individual debtors.

The OSB’s ideas were designed to help formulate a

response to an evaluation conducted by Industry Canada

in late 2011 which highlighted that there were no

objective measures in the current system to verify that

mandatory counselling has achieved positive outcomes

for debtors.

As a critical stakeholder in this process, CAIRP

constituted a Task Force of trustees experienced in

consumer insolvencies to study the preliminary ideas put

forward by the OSB and put forward some key building

blocks of a reformed system that would focus attention

on the needs of individual debtors while not over-

burdening trustees.

The OSB has now invited other stakeholders to join this

process through the creation of the Mandatory

Counselling Advisory Committee on which CAIRP is

well represented.

I want to thank my fellow Task Force members, Mike

Braga, Chantal Gingras and Ian Penney, for their

dedication in assembling such excellent ideas on this key

issue, and Bea Casey for her excellent support.

Colleen Craig, CA, CIRP


Chair

19

MEDIA TASK FORCE

The Media Task Force Committee (the “MTF” or the

“Committee”) was established in September 2012 to

examine ways to enhance the CAIRP brand and

differentiate our member’s capabilities in the markets

they serve. The goal of the Committee was to promote

CAIRP and its members as the “Go-To Professionals” for


and restructuring matters.

CAIRP engaged an external media relations consultant to

work with the MTF and develop a comprehensive media

relations strategy. A branding outline summarizing the

mission statement, positioning statement, vision and

values of the Association, which distinguishes our

members from our competition was developed. In

addition, a Strategic Communications Plan identifying a

series of insolvency topics on which bylined articles,

media releases or media pitches (story proposals) could

be developed to generate effective media coverage

opportunities for CAIRP members was prepared.

With the assistance of the Association’s external media

consultant, CAIRP member insights on important

consumer topics including insolvencies among seniors,

student debt, consumer proposals, small business failures

and holiday spending problems were reported upon in

multiple mainstream publications across Canada during

this past fiscal year. These articles and interviews

provided a platform for CAIRP members to demonstrate

their expertise in these areas and also to clarify the

benefits that a Trustee in Bankruptcy can provide in

insolvency situations as opposed to other, non-licensed,

insolvency consultants.

The Strategic Communications Plan developed by the

Committee proposed to leverage the use of social media

(Facebook, Twitter and LinkedIn) to further promote the

CAIRP brand. Although best practices for using social

media in both official languages were researched by the

Committee, this remains an area where CAIRP will

continue to explore its options with a view to balancing

the benefits that can be obtained through the proactive

use of social media against the cost and time

commitments required to administer same.

I would like to take this opportunity to personally thank

the MTF members for all of their hard work and

dedication to the Committee over the past few years.

Without the dedication and volunteer hours from such

individuals, the Committee’s goals could not be reached.

Committee members include: Jeremy Kroll, Ken

Robbs, Sharon Stapley and Nathalie Brault.

George Kinsman CA, CIRP


Professional,Chair

TARIFF REVIEW TASK FORCE

The Tariff Review Task Force for summary

administration files was created in the spring of 2013

following a face-to-face meeting of Provincial

Association presidents held in Winnipeg in February of

the same year. Volunteers to participate in this important

Task Force were identified and chosen for their

representation of the wide spectrum of the insolvency

field. They are representative of different regions of the

country and have the necessary expertise to provide input

from most of the industry stakeholders.

The Task Force members have analysed statistics on

consumer insolvency files submitted by the Office of the

Superintendent of Bankruptcy (“OSB”) and reviewed

individual data from their own practices. They have

identified a number of factors which justifies the need for

amendments to Rule 128 of the BIA General Rules and

the request for a tariff increase. The Task Force strongly

believes that trustees need to be remunerated adequately

in view of increasing costs and responsibilities.

The Task Force considered the multiple concerns of the

key stakeholders in the consumer insolvency process

including debtors, creditors and the OSB. We submitted a

new grid for the calculation of the tariff that is simple

and easy to apply. The Task Force made a preliminary

proposal for changes to the OSB in early February for an

adjustment in the tariff. At the OSB’s request, the Task

Force agreed to undertake further research to identify the

impact of any changes in the tariff on all stakeholders in

the insolvency system.

To achieve the objective of a balance between

stakeholders and trustees’ need to be remunerated

adequately, the Task Force recommended that the tariff

be amended along with an adjustment in administrative

disbursements and the frequency of draws. By pursuing

these three recommendations, the Task Force has worked

to present an optimal solution and applicable

amendments to the BIA General Rules.

20

I gratefully thank the members of the Task Force for their

professionalism, generosity and availability. It was a

pleasure working together with all of you. Members of

the Task Force are:

Yoine Goldstein, Outside Director of the

Board of Directors of CAIRP and Chair of

the former Personal Insolvency Task Force

Peter Wedlake, past Chair of CAIRP

Chantal Gingras, Member of the Board of

Directors of CAIRP

Melanie Wengle, Ontario Member of

CAIRP

Randy West, British Columbia Member of

CAIRP

David Stewart, Outside Consultant and

past member of the Extended Executive

Committee of the Office of the

Superintendent of Bankruptcy (retired)

James Moses, Alberta Member of CAIRP

Virginie Comtois, CPA, CA, CIRP


Chair

WEBSITE TASK FORCE

The Website Task Force (“WTF”) was created to assist

CAIRP in implementing its new Strategic Plan relating to

our Communications strategy. The new Website will be

used to help promote the Association’s overall image and

support its mission to be the “Go-To Association for


and restructuring”.

The goal of the Task Force was to seek and retain the

services of a website consultant to create and maintain a

website consistent with the focus of CAIRP’s rebranding

initiative. The Task Force researched all avenues

regarding the website, including social media links, site

maintenance, and the easy accessibility of important

content, and reported back to the Board on the key

specifications for a new website.

The Task Force commenced its mandate by reviewing

the CAIRP’s current website along with those of other

professional organizations. These findings were

reviewed and processed such that the Task Force was

able to prepare a consistent and precise framework to

prepare a Request for Proposals for a new website

consultant.

Multiple website consulting firms were contacted based

on recommendations and referrals from Task Force

members, CAIRP and various interested parties. A

number of proposals were submitted and were

thoroughly assessed and reviewed by the Website Task

Force.

The selection was subsequently shortlisted to two

proposals. Members of the Task Force, in conjunction

with CAIRP staff recommended retaining the services of

Vignola Communication Marketing to complete the task

of redesigning CAIRP’s website.

We are optimistic that CAIRP’s new and improved

website will be launched by the time members see this

report.

I would like to take this opportunity to thank the

members of the Website Task Force -- Catherine

Nguyen, Melanie Murray, Rob Biehler, and Georges

Faucher -- for their tireless work and enthusiasm in

accomplishing the mandate of the Task Force, and would

like to acknowledge Mark Yakabuski as well for his

invaluable assistance.

Gregory J. Fontaine, CIRP


Chair

21

MEMBERSHIP

1General members who have left insolvency practice may be deemed to be inactive. If they have not reinstated themselves

within 5 years, their membership will be terminated.

AS OF MARCH 31 2014 2013 2012 2011 2010 2009

GENERAL 954 931 920 900 882 868

ARTICLING 365 422 420 399 405 365

CORPORATE 23 23 22 26 27 28

LIFE 157 175 168 157 161 160

INACTIVE1 13 14 14 11 20 24

22

TREASURER’S REPORT

On behalf of the Board of Directors, I am pleased to

present the audited financial statements of the CAIRP for

the year ended March 31, 2014 (“F’2014”). Below you

will find comments with respect to our financial results

for the year, our financial position, our surplus and

restricted and unrestricted equity position, our financial

goals for fiscal 2014 (“F’2015”) and our longer-term

forecast beyond fiscal 2014.

Statement of Financial Position

As at March 31, 2014, the Association continued to enjoy

a strong liquidity position which includes cash and cash

equivalents of $1,126,538 plus long-term investments of

$1,233,022 for a total of $2,359,560 (2013 - $2,246,882).

This represents an improvement of $112,678 from the

prior year.

This improvement is primarily due to lower than

anticipated spending in several areas including

communications and various committee activities.

No changes were made during the year to the

Association’s long-term investments with $1.2 million

invested in various provincial government bonds

maturing between 2016 and 2024.

The Association’s net working capital position of

$811,424 is an improvement of $51,299 over F’2013.

Additionally, current liabilities as at March 31, 2014 of

$416,033 are consistent with the prior year accounts

payable as deferred revenue (resulting from higher fee

and program prepayments) rose in F’2014.

Statement of Operations

Total revenues for the Association in F’2014 were

$2,553,928 (2013 - $3,077,091), a decrease of $523,163

from the prior year largely due to lower course and

examination fees from the CIRP Qualification Program

(“CQP”). As expected, the number of student numbers

moving through the CQP courses and exams in F’2014

declined after the prior two years where revenues from

CQP courses and exams were at historic highs.

Overall, annual conference and continuing education

revenues were lower, and other revenues declined after

proceeds of $50,217 were collected from the Exposoft

Group insurer in F’2013.

Expenses for the year were $2,551,916 (2013 -

$2,619,372), a net decrease of $67,456 from the prior

year that reflects lower expenses for the annual

conference and CQP due to lower

attendance/participation levels, higher continuing

education costs due to higher speaker fees, and higher

administration costs as compared to F’2013.

Communications (included in administration) rose by

$107,000 reflecting increased activity and investment in

our website, website content and social media strategy,

while general office costs including mailing and printing

costs were reduced by $42,000 as the Association

continues to implement a strategy of reducing paper

billings and mailouts. Salaries and benefits were higher

by $29,000 due to the addition of a Communications

Manager for part of F’2014.

Originally a deficit of $749,000 was forecast for F’2014.

However, a surplus of $2,012 (2013 - $457,719) has been

realized. This variance of $751,000 has been caused by a

variety of factors including higher net revenues from

sponsorships, lower spending in communications, certain

committees, and lower general office expenses, in part

caused by website redevelopment costs and CQP

development costs being deferred into the next fiscal

year, and lower committee task force spending with

many meetings being conducted through teleconferences

instead of face-to-face.

Restricted and Unrestricted Equity

As noted in the F’2013 and F’2012 Treasurer’s reports,

our recent surpluses have been largely generated from the

delivery of CQP courses and exams, and such a surplus

was forecast to be reduced in F’2014 and thereafter due

to lower enrolment levels. In F’2014, the surplus

generated from CQP delivery was reduced from the prior

levels. Pursuant to the revised Memorandum of

Understanding between the Superintendent of

Bankruptcy and the Association dated October 8, 2009,

the Association is responsible for the maintenance and

revision of all course materials associated with CQP, as

well as future strategic reviews of the CQP associated

with the five-year review of the Memorandum of

Understanding. The costs of future strategic review and

maintenance of the CQP were estimated at $1.0 million,

and the Association chose in 2012 to restrict $1.0 million

of its equity for this purpose. This estimate was

developed by my predecessors, who recognized that our

enrolment levels may fluctuate while resources required

to maintain our programs may not fluctuate.

No direct investment was made in F’2014 or F’2013 for

the review and maintenance of the CQP materials.

Accordingly, the internally imposed restriction of $1.0

million for CQP review and maintenance has not been

adjusted.

After this internally imposed restriction of $1.0 million

for CQP review and maintenance, the net equity of the

23

Association is now comprised of unrestricted equity of

$1,035,262 (2013 - $964,568), and capital and intangible

assets of $151,717 (2013 - $220,399). The restricted

equity balance of $1.0 million will be reviewed annually

to determine whether the amount remains satisfactory as

CQP course maintenance activities are undertaken in the

coming years.

Financial Goals for Fiscal 2015 and Beyond

The Finance Committee presented the budget for

CAIRP’s fiscal year ending March 31, 2015 to the Board

on March 19, 2014. This budget forecasts a deficit of

revenues over expenses and was approved by the Board.

The F’2015 budget deficit assumes:

no change in membership fees;

slightly higher general membership numbers;

lower fee levels for new students entering the CQP

program and attending the CQP tutorial;

lower course and exam fee revenues consistent with

lower CQP enrolment levels;

higher CQP implementation and development costs

(as discussed above); and

higher expenditures for communications, certain

committees and payroll.

The F’2015 budget deficit needs to be considered in light

of the significant strategic planning and governance

initiatives that were approved in F’2012, a portion of

which have been implemented over the past two years

with many other initiatives underway, and

commencement of the reinvestment in the CQP for which

$1.0 million of our equity has been restricted and is

expected to be spent in the coming years.

With input from the Finance Committee, the Board

decided to reduce certain CQP fees (noted above) and

also recommended that continuing education fees be

reduced in certain cases (implemented for both the

Forums and Annual Conference) after considering recent

surpluses and other initiatives to promote participation

and education.

The Finance Committee is now working to refine its

longer term forecast for revenues and expenses

considering the near term F’2015 budget deficit forecast,

the cash and investments on hand (approximately $2.35

million), the $1.0 million of internally restricted equity

allocated to the CQP, and how the strategic planning and

governance initiatives will unfold post-F’2015. These

elements of the forecast will be considered with the

Board along with our fee rates and cost levels in relation

to the current operations of the Association to assess the

longer term sustainable cash flow of the Association.

There are many exciting initiatives that are underway

with your Association and a constant need for member

volunteers. If you are not currently involved please

consider raising your hand.



Treasurer

CANADIAN ASSOCIATION OF INSOLVENCYAND RESTRUCTURING PROFESSIONALS /

ASSOCIATION CANADIENNE DES PROFESSIONNELS DE L'INSOLVABILITÉ ET DE LA RÉORGANISATION

FINANCIAL STATEMENTS

MARCH 31, 2014

Independent Auditor's Report

To the Members of Canadian Association of Insolvency and Restructuring Professionals /Association canadienne des professionnels de l'insolvabilité et de la réorganisation

We have audited the accompanying financial statements of Canadian Association of Insolvency andRestructuring Professionals / Association canadienne des professionnels de l'insolvabilité et de laréorganisation, which comprise the statement of financial position as at March 31, 2014, and thestatements of operations, changes in net assets and cash flows for the year then ended, and a summaryof significant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements inaccordance with Canadian accounting standards for not-for-profit organizations, and for such internalcontrol as management determines is necessary to enable the preparation of financial statements that arefree from material misstatement, whether due to fraud or error.

Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. Weconducted our audit in accordance with Canadian generally accepted auditing standards. Those standardsrequire that we comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures inthe financial statements. The procedures selected depend on the auditor's judgment, including theassessment of the risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, the auditor considers internal control relevant to the association'spreparation and fair presentation of the financial statements in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness ofthe association's internal control. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of accounting estimates made by management, as well asevaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis forour audit opinion.

Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position ofCanadian Association of Insolvency and Restructuring Professionals / Association canadienne desprofessionnels de l'insolvabilité et de la réorganisation as at March 31, 2014, and the results of itsoperations and its cash flows for the year then ended in accordance with Canadian accounting standardsfor not-for-profit organizations.

Toronto, OntarioJuly 8, 2014

Chartered Professional AccountantsLicensed Public Accountants

1

CANADIAN ASSOCIATION OF INSOLVENCY AND RESTRUCTURINGPROFESSIONALS / ASSOCIATION CANADIENNE DES PROFESSIONNELS DEL'INSOLVABILITÉ ET DE LA RÉORGANISATION

Statement of Financial Position

March 31 2014 2013$ $

ASSETS

Current assetsCash 1,126,538 1,030,567Sundry receivables 8,655 15,168Prepaid expenses 92,264 80,366

1,227,457 1,126,101

Investments (note 3) 1,233,022 1,216,315Capital assets (note 4) 131,950 172,253Intangible assets (note 5) 43,978 79,444

1,408,950 1,468,012

2,636,407 2,594,113

LIABILITIES

Current liabilitiesAccounts payable and accrued liabilities (note 6) 256,178 229,140Deferred revenue 159,855 136,836

416,033 365,976

Deferred lease incentives (note 7) 33,395 43,170

449,428 409,146

NET ASSETS

Invested in capital and intangible assets 151,717 220,399Internally restricted (note 8) 1,000,000 1,000,000Unrestricted 1,035,262 964,568

2,186,979 2,184,967

2,636,407 2,594,113

Approved on behalf of the Board:

Paul Casey, CPA, CA, CIRPChartered Insolvency and Restructuring Professional Chair

Anthony Tillman, CPA, CA, CIRPChartered Insolvency and Restructuring Professional Treasurer

2


Statement of Operations

Year ended March 31 2014 2013$ $

RevenuesMembership fees 1,016,730 1,001,220Annual conference fees and sponsorship 223,042 296,330CQP course and examination fees 818,690 1,180,687Continuing education seminar fees and sponsorship 446,175 472,525Other (note 9) 16,536 62,501Investment income (note 10) 32,755 63,828

2,553,928 3,077,091

ExpensesAdministration (see schedule) 1,852,869 1,783,008Annual conference 176,843 235,382CQP courses and examinations 287,805 403,383Continuing education 234,399 197,599

2,551,916 2,619,372

Excess of revenues over expenses for year 2,012 457,719

3


Statement of Changes in Net Assets

Year ended March 31

Invested inCapital and

IntangibleAssets

InternallyRestricted

(note 8) Unrestricted2014Total

$ $ $ $

Balance, beginning of year 220,399 1,000,000 964,568 2,184,967

Excess of revenues over expenses(expenses over revenues) for year (71,489) - 73,501 2,012

Purchase of capital assets 2,807 - (2,807) -

Balance, end of year 151,717 1,000,000 1,035,262 2,186,979

Invested inCapital and

IntangibleAssets

InternallyRestricted

(note 8) Unrestricted2013Total

$ $ $ $

Balance, beginning of year 281,102 1,000,000 446,146 1,727,248

Excess of revenues over expenses(expenses over revenues) for year (71,827) - 529,546 457,719

Purchase of capital assets 11,124 - (11,124) -

Balance, end of year 220,399 1,000,000 964,568 2,184,967

4


Statement of Cash Flows


Cash flows from operating activitiesExcess of revenues over expenses for year 2,012 457,719Adjustments to determine net cash provided by (used in) operating

activitiesAmortization of capital assets 43,110 43,447Amortization of intangible assets 35,466 35,467Interest capitalized on investments (43,803) (29,914)Unrealized loss (gain) on investments 27,096 (13,638)Amortization of deferred lease incentives (9,775) (9,775)Payment of retiring and transition allowance - (50,000)

54,106 433,306Change in non-cash working capital items

Decrease in sundry receivables 6,513 23,427Increase in prepaid expenses (11,898) (29,784)Increase in accounts payable and accrued liabilities 27,038 27,997Increase in deferred revenue 23,019 20,206

98,778 475,152

Cash flows from investing activitiesPurchase of investments - (500,000)Purchase of capital assets (2,807) (11,124)

(2,807) (511,124)

Net change in cash 95,971 (35,972)

Cash, beginning of year 1,030,567 1,066,539

Cash, end of year 1,126,538 1,030,567

5


Schedule of Administration Expense


Amortization of capital assets 43,110 43,447Amortization of intangible assets 35,466 35,467Audit, legal and consulting 87,907 120,539Committees 242,901 240,942Insol International 45,360 42,263Communication 225,777 119,018Office, printing, postage, courier and sundry 157,055 199,298Rent (note 7) 121,154 116,796Salaries and benefits 894,139 865,238

1,852,869 1,783,008

6


Notes to Financial Statements

March 31, 2014

Nature and description of the organization

The Canadian Association of Insolvency and Restructuring Professionals / Association canadienne desprofessionnels de l'insolvabilité et de la réorganisation (the “Association”) was incorporated under theCanada Corporations Act on July 27, 1979. The Association was established to advance the practice ofinsolvency administration and the public interest related to it.

The Association is a not-for-profit organization, as described in Section 149(1)(l) of the Income Tax Act,and therefore is not subject to either federal or provincial income taxes.

1. Significant accounting policies

These financial statements have been prepared by management in accordance with Canadianaccounting standards for not-for-profit organizations and include the following significantaccounting policies:

(a) Revenue recognition

(i) Membership fees

Membership fees are recognized as revenue proportionately over the fiscal year towhich they relate. The membership year of the Association coincides with that of thefiscal year of the Association, being April 1 to March 31. Membership fees received inadvance of the membership year to which they relate are recorded as deferredrevenue.

(ii) Annual conference

Revenue from the annual conference is recognized in the fiscal year in which theconference is held.

(iii) Sponsorship

Revenue from event sponsorships is recognized in the fiscal year in which the relatedevent is held. Sponsorships received in advance of the date of the related event arerecorded as deferred revenue.

(iv) Seminar, course and examination fees

Revenue from continuing education seminars, insolvency administration courses andCQP courses are recognized in the fiscal year of enrolment. Examination fees arerecognized in the fiscal year in which the examination takes place. Examination feesreceived in advance of the fiscal year in which the examination is held are recorded asdeferred revenue.

7


Notes to Financial Statements (continued)

March 31, 2014

1. Significant accounting policies (continued)

(v) Investment income

Investment income comprises interest from cash, interest from investments, realizedgains and losses on the sale of investments and unrealized gains and losses oninvestments.

Interest is recognized on an accrual basis. Interest on fixed income investments isrecognized over the terms of the respective investments using the effective interestmethod.

(b) Deferred lease incentives

Lease incentives received include reduced rent benefits and tenant inducements received incash.

Lease incentives received in connection with original leases are amortized to income on astraight-line basis over the terms of the original leases. Lease incentives received inconnection with re-negotiated leases are amortized to income on a straight-line basis overthe period from the expiration date of the original lease to the expiration date of the re-negotiated lease.

8



March 31, 2014


(c) Financial instruments

(i) Measurement of financial instruments

The Association initially measures its financial assets and financial liabilities at fair valueadjusted by, in the case of a financial instrument that will not be measured subsequentlyat fair value, the amount of transaction costs directly attributable to the instrument.

The Association subsequently measures all its financial assets and financial liabilities atamortized cost, except for investments, which are measured at fair value. Changes infair value are recognized in income in the period the changes occur.

Amortized cost is the amount at which a financial asset or financial liability is measuredat initial recognition minus principal repayments plus or minus the cumulativeamortization of any difference between the initial amount and the maturity amount, andminus any reduction for impairment.

Transaction costs are recognized in income in the period incurred, except for financialinstruments that will be subsequently measured at amortized cost. Transaction costsassociated with the acquisition and disposal of investments are capitalized and areincluded in the acquisition costs or reduce proceeds of disposal.

Financial assets measured at amortized cost include cash and sundry receivables.

Financial liabilities measured at amortized cost include accounts payable and accruedliabilities.

(ii) Impairment

At the end of each reporting period, the Association assesses whether there are anyindications that a financial asset measured at amortized cost may be impaired.Objective evidence of impairment includes observable data that comes to the attentionof the Association, including but not limited to the following events: significant financialdifficulty of the issuer; a breach of contract, such as a default or delinquency in interestor principal payments; and bankruptcy or other financial reorganization proceedings.

When there is an indication of impairment, the Association determines whether asignificant adverse change has occurred during the period in the expected timing oramount of future cash flows from the financial asset.

When the Association identifies a significant adverse change in the expected timing oramount of future cash flows from a financial asset, it reduces the carrying amount of theasset to the greater of the following:

9



March 31, 2014


- the present value of the cash flows expected to be generated by holding the assetdiscounted using a current market rate of interest appropriate to the asset; and

- the amount that could be realized by selling the asset at the statement of financialposition date.

Any impairment of the financial asset is charged to income in the period in which theimpairment is determined.

When the extent of impairment of a previously written-down asset decreases and thedecrease can be related to an event occurring after the impairment was recognized, thepreviously recognized impairment loss is reversed to the extent of the improvement, butnot in excess of the impairment loss. The amount of the reversal is recognized inincome in the period the reversal occurs.

(d) Investments

Investments consist of Canadian fixed income investments with maturity dates greater thanthree months from the date of acquisition. Fixed income investments maturing within twelvemonths from the year-end date are classified as current.

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(e) Capital assets

The costs of capital assets are capitalized upon meeting the criteria for recognition as acapital asset, otherwise, costs are expensed as incurred. The cost of a capital assetcomprises its purchase price and any directly attributable cost of preparing the asset for itsintended use.

Capital assets are measured at cost less accumulated amortization and accumulatedimpairment losses.

Amortization is provided for on a straight-line basis at rates designed to amortize the cost ofthe capital assets over their estimated useful lives. The annual amortization rates are asfollows:

Computer equipment 5 yearsFurniture and fixtures 10 years

Leasehold improvements are amortized on a straight-line basis over the remaining term ofthe lease.

A capital asset is tested for impairment whenever events or changes in circumstancesindicate that its carrying amount may not be recoverable. If any potential impairment isidentified, then the amount of the impairment is quantified by comparing the carrying value ofthe capital asset to its fair value. Any impairment of the capital asset is charged to income inthe period in which the impairment is determined.

An impairment loss is not reversed if the fair value of the capital asset subsequentlyincreases.

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(f) Intangible assets

Intangible assets consist of separately acquired computer application software.

The costs of intangible assets are capitalized upon meeting the criteria for recognition as anintangible asset, otherwise, costs are expensed as incurred. Expenditures or internallygenerated intangible assets during the development phase are expensed as incurred. Thecost of a separately acquired intangible asset comprises its purchase price and any directlyattributable cost of preparing the asset for its intended use.

Intangible assets are measured at cost less accumulated amortization and accumulatedimpairment losses.

Amortization is provided for on a straight-line basis over a period of five years at a ratedesigned to amortize the cost of the intangible assets over their estimated useful lives.

An intangible asset is tested for impairment whenever events or changes in circumstancesindicate that its carrying amount may not be recoverable. If any potential impairment isidentified, then the amount of the impairment is quantified by comparing the carrying value ofthe intangible asset to its fair value. Any impairment of the intangible asset is charged toincome in the period in which the impairment is determined.

An impairment loss is not reversed if the fair value of the intangible asset subsequentlyincreases.

(g) Net assets invested in capital and intangible assets

Net assets invested in capital and intangible assets comprises the net book value of capitaland intangible assets less the unamortized balance of lease incentives used to purchasecapital assets.

(h) Contributed services

The work of the Association is dependant on the voluntary service of many individuals. Sincethese services are not normally purchased by the Association and because of the difficulty ofdetermining their fair value, contributed services are not recognized in these financialstatements.

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(i) Management estimates

The preparation of financial statements in conformity with Canadian accounting standards fornot-for-profit organizations requires management to make judgments, estimates andassumptions that affect the application of accounting policies and the reported amounts ofassets and liabilities and the disclosure of contingent assets and liabilities at the date of thefinancial statements and the reported amounts of revenues and expenses during the currentperiod. Actual results may differ from the estimates, the impact of which would be recordedin future periods.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions toaccounting estimates are recognized in the year in which the estimates are revised and inany future years affected.

2. Financial risk management

The Association is exposed to various risks through its financial instruments. The followinganalysis provides a measure of the Associations' risk exposure and concentrations.

The financial instruments of the Association and the nature of the risks to which it may be subjectare as follows:

Risks

Market risk

Financial instrument Credit Liquidity Currency Interest rate Other price

Cash X XSundry receivables X Investments X XAccounts payable and accrued

liabilities X

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2. Financial risk management (continued)

Credit risk

The Association is exposed to credit risk resulting from the possibility that parties may default ontheir financial obligations, or if there is a concentration of transactions carried out with the sameparty, or if there is a concentration of financial obligations which have similar economiccharacteristics that could be similarly affected by changes in economic conditions, such that theAssociation could incur a financial loss. The Association does not hold directly any collateral assecurity for financial obligations of counterparties.

The maximum exposures of the Association to credit risk is as follows:

2014 2013$ $

Cash 1,126,538 1,030,567Sundry receivables 8,655 15,168Investments 1,233,022 1,216,315

2,368,215 2,262,050

The Association reduces its exposure to the credit risk of cash by maintaining balances withCanadian financial institutions.

The Association manages its exposure to credit risk associated with investments through itsinvestment policy which restricts the types of eligible investments. The policy permits investmentsin debt securities rated by DBRS as AA or higher and issued or guaranteed by the Government ofCanada, a provincial government or a Schedule 1 Canadian Bank. In addition, the policy limitsindividual investments to $300,000.

Liquidity risk

Liquidity risk is the risk that the Association will not be able to meet a demand for cash or fund itsobligations as they come due.

The Association meets its liquidity requirements by preparing and monitoring detailed forecasts ofcash flows from operations and anticipated investing and financing activities and holding assetsthat can be readily converted into cash.

Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuatebecause of changes in market prices. Market risk is comprised of currency risk, interest rate riskand other price risk.

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2. Financial risk management (continued)

Currency risk

Currency risk refers to the risk that the fair value of financial instruments or future cash flowsassociated with the instruments will fluctuate due to changes in foreign exchange rates.

The Association is not exposed to currency risk.

Interest rate risk

Interest rate risk refers to the risk that the fair value of financial instruments or future cash flowsassociated with the instruments will fluctuate due to changes in market interest rates.

The Association is exposed to interest rate risk on its cash and investments.

The Association's cash includes amounts on deposit with financial institutions that earn interest atmarket rates.

The Association manages its exposure to the interest rate risk of its cash by maximizing theinterest income earned on excess funds while maintaining the minimum liquidity necessary toconduct operations on a day-to-day basis. Fluctuations in market rates of interest on cash do nothave a significant impact on the Association's results of operations.

The objective of the Association with respect to its investments is to ensure the security ofprincipal amounts invested and provide for a high degree of liquidity, while achieving a satisfactoryinvestment return.

The Association manages the interest rate exposure of its investments by using a ladderedportfolio with varying terms to maturity. The laddered structure of maturities helps to enhance theaverage portfolio yield while reducing the sensitivity of the portfolio to the impact of interest ratefluctuations.

The Association does not use derivative financial instruments to manage its exposure to interestrate risk.

Other price risk

Other price risk refers to the risk that the fair value of financial instruments or future cash flowsassociated with the instruments will fluctuate because of changes in market prices (other thanthose arising from currency risk or interest rate risk), whether those changes are caused byfactors specific to the individual instrument or its issuer or factors affecting all similar instrumentstraded in the market.

The Association is not exposed to other price risk.

Changes in risk

There have been no significant changes in the Association's risk exposures from the prior year.

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3. Investments

Quantity 2014 2013$ $ $

Province of Ontario -4.29% - due 06/02/16 65,874 63,845 62,455

Province of Ontario -4.42% - due 11/03/19 387,319 332,901 328,020

Province of Quebec -4.38% - due 06/01/21 418,089 334,931 330,249

Province of Saskatchewan -2.86% - due 05/30/22 325,393 250,943 248,405

Province of British Columbia -3.33% - due 08/23/24 365,390 250,402 247,186

1,233,022 1,216,315

4. Capital assets

CostAccumulatedAmortization

2014Net

$ $ $

Computer equipment 90,935 80,604 10,331Furniture and fixtures 68,643 45,870 22,773Leasehold improvements 299,787 200,941 98,846

459,365 327,415 131,950


2013Net

$ $ $

Computer equipment 88,128 72,899 15,229Furniture and fixtures 68,643 39,396 29,247Leasehold improvements 299,787 172,010 127,777

456,558 284,305 172,253

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5. Intangible assets

Intangible assets are comprised of database application software.


2014Net

$ $ $

Database application software 177,329 133,351 43,978


2013Net

$ $ $

Database application software 177,329 97,885 79,444

6. Accounts payable and accrued liabilities

2014 2013$ $

Trade payables and accrued liabilities 230,885 208,264Government remittances 25,293 20,876

256,178 229,140

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7. Deferred lease incentives

Pursuant to a lease agreement for its office premises which expires August 31, 2017, andincludes two five-year renewal options, lease incentives totaling $101,820, comprised of reducedrent benefits of $28,000 and tenant inducements of $73,820 were received.

During the year, amortization of lease incentives in the amount of $9,775 (2013 - $9,775) wascredited to rent.


2014Net

$ $ $

Lease incentives 73,820 49,609 24,211Reduced rent benefits 28,000 18,816 9,184

101,820 68,425 33,395


2013Net

$ $ $

Lease incentives 73,820 42,522 31,298Reduced rent benefits 28,000 16,128 11,872

101,820 58,650 43,170

8. Internally restricted net assets

Pursuant to the revised Memorandum of Understanding between the Superintendent ofBankruptcy and the Association dated October 8, 2009, the Association is responsible for themaintenance and revision of all course materials associated with the CQP, as well as futurestrategic reviews of the CQP associated with the five year review of the Memorandum ofUnderstanding. As the Association is a not-for-profit organization, and the estimated costs offuture strategic review and maintenance of the CQP are significant, the Association has chosen tointernally restrict a portion of its net assets in order to fund the estimated costs of the continueddevelopment and maintenance of the CQP.

The Association has estimated that $1,000,000 should be internally restricted for the purpose ofupdating and replacing CQP course content.

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9. Other income

In 2013, other income included $50,217 relating to the Association's share of the proceeds fromthe settlement of a jointly filed lawsuit between the Association and the ExpoSoft Group againstthe Directors of the Association's former payment processing service provider and their insurer.

10. Investment income

2014 2013$ $

Interest from cash 16,048 20,276Interest from investments 43,803 29,914Unrealized gain (loss) on investments (27,096) 13,638

32,755 63,828

11. Commitment

Future minimum annual lease payments for the office premises of the Association including anestimate of the proportionate share of property taxes, operating expenses and utilities are asfollows:

$

2015 129,9602016 129,9602017 129,9602018 54,150

444,030

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Canadian Association of Insolvency and Restructuring Professionals/Association canadienne des professionnels de l’insolvabilité et de la réorganisation277 Wellington Street West/rue Wellington ouest, Toronto, ON M5V 3H2

www.cairp.ca

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