#32 Simple Accounting

I don't pretend to be an accountant, but I know enough to read a financial statement and to understand the fiscal news. So when the outgoing federal government claims to have a balanced budget or — this past week — a surplus in the second quarter, I have to look a little closer.

First off, there's that appropriation of the Employment Insurance “surplus” that I mentioned way back in item #1. Although you might like to build that into your budget as regular revenue, it isn't. It is a discrete event, a misappropriation of a fund that was intended to provide relief for people between jobs, but which had built up a “surplus” through the jacking up of the employee and employer contributions (no government money in there) and the increasing restrictions on eligibility for benefits. But I've already gone on about that one, so...moving along...

What happened in the second quarter of the current year is that the government sold its remaining shares in GM, and at a loss, to boot. Shares in a company are the kind of thing that would be recorded on a balance sheet, not a statement of revenue and expenses. If anything, they should be recording the capital loss as an expense, amiright? Smoke and mirrors to take our attention away from the fact that our “trustworthy stewards of the economy” have led us into another recession (two quarters of negative GDP growth) and will grasp at any straw to try to show themselves to be competent.

What would the expression be...the accountant has no books?

Further reading here. 

Sell the silverware!
Next accounting is after
October nineteenth