Blyth's Better Books

10/29/2025

Do you know the difference between Zero-Rated and Exempt?

Other than the traditional GST/HST/PST sales taxes, zero-rated and exempt are other options for sales tax.
The difference between the two are that zero-rated charges do charge the sales tax but at 0%. While exempt doesn't charge tax at all.
Some examples of zero-rated taxable supplies include: prescription drugs, grocery basics and goods/services exported from Canada to name a few.
Exempt supplies include: most medical, dental and health services, child and personal care services and most services provided by financial institutions to name a few.

It is VERY important to know the differences for bookkeeping purposes for filing taxes.

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10/28/2025

Really looking forward to the Autumn Tax Primer on November 18. This is a 7.5 hour webinar I am attending through CPB Canada to gain more valuable information for preparing taxes.

I also am starting a course this upcoming Monday on how to prepare T2s for Corporate taxes. This will be very interesting and I am really looking forward to this course. It runs from November 3 - December 19 so by end of the year I should know how to do a Corporate T2.

I am really investing a lot of time not only continuing to learn about bookkeeping and payroll, but taxes as well. This is only the start of my bookkeeping journey and I intend to make it a very long one.

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10/28/2025

Do you know the difference between a Calendar year and Fiscal year?

Calendar year is when a business has an accounting period that starts January 1 and goes to December 31. These are typically Sole Proprietors and Partnerships.

A fiscal year is when a business has an accounting period that is not the same as a calendar year. For example, February 1 to January 31. This accounting period is mostly used by Corporations.

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10/22/2025

What's the difference of Cash Basis and Accrual Basis?

Cash basis is used for a business when money has ACTUALLY been exchanged. There are no transactions recorded when a purchase or sale has been made for a future date. Accounts Receivable and Accounts Payable do not exist in cash basis accounting.
Only certain businesses are allowed to use this basis of accounting by the Federal Government such as farmers and fishers. You need permission from the Government to use this basis.

Accrual basis is what is used by most businesses in Canada. This is where Accounts Receivable and Accounts Payable come into play. Money earned or owed is recorded even if money has yet to be exchanged.

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10/22/2025

Earned my QBO Advanced Certification this morning!

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10/20/2025

Now for the last 2 GAAP Principles

GAAP Principle #7

Conservatism

Holds that accountants should be conservative in their estimates and opinions and in the selection of procedures, choosing those that neither unduly understate nor overstate the situation.

An example would be advertising not generating the business for that month, but does so the next month. The accountant may choose to show this in the same accounting cycle and would be reasonable so the revenue earned later is not overstated.

GAAP Principle #8

Consistency

Requires a constant application by a company of any selected accounting method of procedures, accounting period after accounting period.

This means you should not change the method used to report any financial information without showing reason for the change and its effect.

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10/20/2025

I'm going to include GAAP Principle #5 and #6.

GAAP Principle #5
Adequate Disclosure

Financial statements should contain all information necessary for a reader to understand the financial condition of a business.

This means that suitable explanatory documents should accompany the financial statements.

GAAP Principle #6
Materiality

States that strict adherence to any accounting principle is not required when it is relatively difficult to do and the lack of adherence does not materially affect the reporting of net income.

An example would be a piece of equipment that is used daily in a business but the cost is very small that an asset account does not need to be set up. Assets are recorded when the equipment exceeds the $500 value of a single item excluding taxes.

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10/15/2025

GAAP Principle #4

Matching Expenses with Revenue

Revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period.

Whether you're a sole proprietor or an incorporation, the matching principle is the same. Sole proprietors have calendar year accounting periods while incorporations have fiscal accounting periods which run when the corporation officially becomes incorporated. For instance October 12, then the fiscal year would be October 1 - September 30.
Whatever accounting period the business has, the matching principle is used under the accrual basis of accounting which is used my most businesses. It's a great way to track what a business is owed and what a business owes.

10/14/2025

A big shout out to Trifold Bookkeeping Advisors!
This was the course I took for my bookkeeping education. It was very detailed and I really enjoyed the process of learning bookkeeping through this course. It teaches manual bookkeeping which is rarely used nowadays but, it teaches you what is going on behind the scenes in software which was really interesting. The Fundamentals and Advanced courses are well worth the time and money. The optional assessment was a great test of what you have learned and I was very proud to pass it with honors.
I am looking forward to keep educating myself in this industry because like everything, bookkeeping evolves and there is constant learning.

10/12/2025

On we go to GAAP Principle #3.

Realization of Revenue
Revenue from business transactions is recorded at the time goods or services are sold.

Revenue must be recorded even if cash has not been received. This is where Accounts Receivable comes into play under the accrual basis of accounting.

10/09/2025

Time for the next GAAP Principle!

Principle 2: Historical Cost

The actual amount paid or received is the amount recorded.

This principle is really straight forward and easy to understand. Whatever the amount of dollars paid or received is in the transaction, is the number that is recorded in the software.