CPA Ontario had another successful year financially, in part due to continued high demand and healthy contribution margins for our education programs. Our financial strength is enabling us to make critical investments that will advance our organization and enhance its ability to support our profession in the years ahead.

Most notably, we have been investing in a digital and business transformation initiative that will improve our service to members and students, and boost our efficiency. Our entire organization is committed to making the cultural, operational, and process changes necessary to ensure that our investments in technology yield the greatest possible value for members, students and other stakeholders, and the long-term success of CPA Ontario.

The discussion that follows lays out the financial position, results of operations, and cash flows of CPA Ontario for the year ended March 31, 2018, including the key drivers of our revenues, expenses, and investments. This discussion is complementary to the summarized audited financial statements.


In fiscal 2018, CPA Ontario strengthened its net asset position, which reached $68.3 million at March 31, 2018 (as compared to $59.9 million in 2017). The $8.4 million change in net assets was driven by two key factors: a $7.8 million excess of revenues over expenses, derived mainly from a higher contribution margin from our education programs, and $0.6 million in remeasurement gains from pensions and employee future benefits.

CPA Ontario has net assets invested in land, buildings, equipment, and other capital assets, as well as internally restricted net assets and unrestricted net assets. CPA Ontario maintains an internally restricted operating reserve intended to support the organization’s day-to-day operations in the event of unforeseen shortfalls or special projects. In fiscal 2018, CPA Ontario increased its operating reserve by $2.0 million to $23.5 million.

During fiscal 2018, CPA Ontario generated cash flows from operating activities of $16.1 million (as compared to $13.2 million in fiscal 2017) and cash flows from investing activities of $11.0 million (as compared to a cash outflow of $16.7 million in 2017).

At March 31, 2018, the organization’s cash and cash equivalents totaled $29.2 million, an increase of $27.1 million from the balance of $2.1 million at the previous year end.

CPA Ontario believes that our current financial resources are sufficient to meet working capital and capital expenditure requirements for the next twelve months.

In fiscal 2018, our total capital expenditures were $1.2 million (as compared to $0.5 million in fiscal 2017), of which $0.9 million was related to information technology equipment and software.


Total revenue for the year surpassed the $100 million mark for the first time in the organization’s history. Our total revenue of $101.7 million in fiscal 2018 (2017: $97.1 million) was derived from three main sources: member dues and fees, education, and professional development. These three sources delivered 95% of total revenues in fiscal 2018, approximately the same proportion as in fiscal 2017 (96%).

Member dues and fees. CPA Ontario collected $45.3 million in dues and fees from our members in fiscal 2018 (slightly less than the $46.3 million collected in 2017); this sum represented 45% of the organization’s revenues (a smaller share than in 2017: 48%). Member dues and fees enable CPA Ontario to fulfill our regulatory functions to promote and protect the public trust. Our regulatory functions include carrying out practice inspections, investigations, responses to complaints, and work with the Public Accountants Council, among other functions. In addition to our regulatory role, CPA Ontario delivers a wide range of member services, including advising on ethical and regulatory matters, career services, networking opportunities, and affinity programs. Member dues and fees collected this year have also enabled CPA Ontario to invest in technology and process improvements that will enhance member and student experience, enable improved professional development offerings, and deliver economies of scale in the years ahead.

Education programs. Education program revenue and student fees totalled $40.5 million in fiscal 2018 (as compared to $35.8 million in 2017). Of this total, $25.5 million (2017: $22.3 million) came from the CPA preparatory course and the professional education program, and $0.5 million (2017: $0.3 million) came from other programs. The rest – $14.5 million in 2018, up from $13.2 million the previous year – came from student fees.

Overall, students enrolled in 7,994 preparatory courses (as compared to 8,949 in 2017) and 17,241 professional education program modules (in 2017: 15,543). The contribution margin from CPA programs in fiscal 2018 is $9.5 million, or 37.3%; in 2017, the contribution margin was $7.6 million, or 34.2% of our total. The significant increase in contribution margin dollars was driven by two factors. We saw 11% higher enrolment in the CPA professional education program, attesting to demand for and relevance of our program offerings. We also received a refund for development costs of the education and examination components of the CPA Certification Program and Preparatory Courses under an Education Agreement with CPA Canada. The increase in contribution margin percentage is due to lower per-unit module and exam costs, combined with savings in delivery and support of the education program.

The increase of $1.3 million in student fees this year is due to a slight increase in student population, which at March 31, 2018 stood at 21,547 (as compared to 21,515 at the close of 2017). In addition, there was a one-time boost to revenue versus the prior year due to the elimination of a fee subsidy related to a student magazine.

Professional Development (PD) programs. PD revenues increased by $0.4 million, from $10.9 million in fiscal 2017 to $11.3 million in fiscal 2018. This increase was driven mainly by sponsorship revenue from a new affinity partner contract signed in fiscal 2017.

Expenses. Total expenses for fiscal 2018 were $93.9 million, up $12.3 million from $81.6 million in fiscal 2017. This increase is primarily due to an increase in education and operations expenses. The expenses incurred in delivering our education programs increased as a result of higher enrollments in the CPA Program and serving more students. Within operations, our legal expenses increased as we conducted a comprehensive review of our governing documents, and increased our investigation and prosecution activities. Expenses in fiscal 2018 also included new spending in strategic areas, such as thought leadership, change management, a strategy refresh, and new technology as we commenced development of our new customer relationship management system and business transformation.

Overall, fiscal 2018 resulted in an excess of revenues over expenses of $7.8 million (2017: $15.5 million). We expect higher expenses next year as we execute on our digital and business transformation and other initiatives, such as a facility strategy to co-locate all our employees, who are currently spread out in two locations. We anticipate these investments will further improve CPA Ontario’s service delivery in the years ahead.


Risk management framework: CPA Ontario is committed to maintaining an Enterprise Risk Management (ERM) framework and policy that ensure risk management is an integral part of the organization’s activities and management processes. The CPA Ontario ERM framework is guided by the following key principles:

  • Governance and Oversight. Ensuring that we have the proper oversight on risk and that risk decisions are made within the framework of the organization’s risk appetite.
  • Infrastructure. Embedding the skills, tools and templates to enable risk identification, assessment and management.
  • Practices. Applying the ERM process for identifying, assessing, managing, monitoring, and reporting key risks.

Risk governance. Risk oversight of CPA Ontario activities resides with Council and the Executive Team.

  • Council oversees the implementation and effectiveness of the organization’s ERM policy and framework, defines the organization’s risk appetite with management, reviews key risks and mitigation strategies, and champions a culture that values the management of risk.
  • The CPA Ontario Executive Team is accountable for effective management of risks in their respective areas and actively participates in the ERM process. The Executive Team ensures risk-taking is consistent with the organization’s risk appetite. The Executive Team also supports the integration of ERM with strategic management, decision making, and business activities and processes. Finally, the Executive Team cultivates open communication and transparency about risk and risk-taking expectations.

Risks to CPA Ontario. CPA Ontario is exposed to a variety of enterprise risks in the normal course of operations that can impact the organization and execution of strategic initiatives. These risks stem from the complex environment the organization operates in and which can be heightened under unusual circumstances. CPA Ontario regularly identifies and assesses its key risks to ensure they are effectively managed. 

Non-financial risks. Risk categories for CPA Ontario other than financial risks include brand and reputation risks, strategic risks, operational risks, technology risks, and human capital risks. CPA Ontario manages these risks through interactions with key stakeholders, activities to enhance the value of the CPA brand, investments in member / student service, strengthening our human capital, and investments in infrastructure including technology. The new Chartered Professional Accountants of Ontario Act also strengthens our organization and the profession to benefit members, students and the public interest.

Financial risks. In the normal course of business, CPA Ontario is exposed to financial risks that have the potential to adversely affect its operating and financial performance. The risks associated with CPA Ontario’s financial instruments are: credit, liquidity and market (i.e., currency, interest rate, and other price risk). Please refer to the audited financial statements for the year ended March 31, 2018, for a description of CPA Ontario’s exposure to these financial risks.

CPA Ontario manages financial risks in accordance with internal policies including its investment policy on the management of its funds. The objectives of the policy are to safeguard our assets through prudent and diversified investments and to ensure liquidity to meet cash flow requirements. The policy seeks to achieve these objectives by setting parameters for asset quality and for the proportions of fixed income and equity securities in which the organization invests. Given the nature of the organization’s investments and the constraints imposed by the investment policy, it is management’s opinion that CPA Ontario is not exposed to significant risk in respect of financial instruments. In addition, CPA Ontario has built a strong balance sheet through prudence in fiscal management. This strong balance sheet serves to mitigate against economic contingencies.