Cultivating Business The official publication of the Canadian Association of Farm Advisors Premier Edition Canada Post Mail Publications Agreement Number: 40609667 Your Canadian Farm Advisors Resource GuidePremier Edition / www.cafanet.com 5 Cultivating Business Published For: Canadian Association of Farm Advisors Box 4077 Redwood Postal Station Winnipeg, Manitoba R2W 5K8 Winnipeg direct: 204-977-4018 Toll free: 1-877-474-2871 Fax: 204-977-4016 Email: info@cafanet.com CAFA Co-Founders: Donna Hastings and Howard Morry CAFA’S NATIONAL BOARD OF DIRECTORS • Ted Clysdale, Investment House Canada Peterborough, ON • Jean-Francois Gratton, Ex officio, BDO Dunwoody LLP Embrun, ON • Sharon Eistetter, Farm Credit Canada Red Deer, AB • Amanda Hammell, RBC Royal Bank Hanover, ON • Leo Kosokowsy, Chair, AgMpower Services Ltd. Saskatoon, SK • Roger Mills, Manitoba Dairy Farm Management Group Steinbach, MB • Mary Nelson Lucknow, ON • Janet Nielsen, JRN Consulting Services Red Deer, AB • Myles Pouteau, Treasurer, Frostiak & Leslie Chartered Accountants Winnipeg, MB • Don Roberts, PricewaterhouseCoopers LLP Calgary, AB • George Sinker, George E. Sinker Law Firm Strathroy, ON CAFA’S ONTARIO BOARD OF DIRECTORS • Michael Bossy, The Michael Bossy Group Tillsonburg, ON • Richard Cressman, Centre for Excellence New Hamburg, ON • Jean-Francois Gratton, BDO Dunwoody LLP Embrun, ON Published By: Matrix Group Inc. Canada Post Mail Publications Agreement Number: 40609661 Return undeliverable copies to: 52 Donald Street, Winnipeg, MB R3C 1L6 Tel: (204) 953-3120 Toll free: (866) 999-1299 Fax: (866) 244-2544 Email: sales@matrixgroupinc.net Web: www.matrixgroupinc.net President & CEO Jack Andress Senior Publisher Maurice LaBorde mlaborde@matrixgroupinc.net Publishers Peter Schulz, Jessica Potter, Trish Bird Editor-in-Chief Shannon Savory ssavory@matrixgroupinc.net Finance/Accounting & Administration Shoshana Weinberg, Nathan Redekop, Pat Andress accounting@matrixgroupinc.net Director of Marketing & Circulation Shoshana Weinberg Sales Manager Neil Gottfred Book Leader Frank Christmann Matrix Group Inc. Account Executives Albert Brydges, Davin Commandeur, Lewis Daigle, Rick Kuzie, Miles Meagher,Ken Percival, Lesley Dion, Brian Davey, Wilma Rose, Jim Hamilton, Chris Frezna, Declan O’Donovan, Jeff Cash Layout & Design J. Peters Advertising Design James Robinson ©2009/2010 Matrix Group Inc. All rights reserved. Contents may not be reproduced by any means, in whole or in part, without the prior written permission of the publisher. The opinions expressed in this publication are not necessarily those of Matrix Group Inc. MESSAGE: 7 A Message from CAFA’s Executive Director, Liz Robertson FEATURES: 9 Show ME the Money 12 Communication in Succession and Estate Planning 14 Certified Seed Helps Certify Success 17 The Future of Agriculture Services 21 Getting the Help You Need to Make the Right Decisions 23 How Will You Replace Your Farm Income? 25 Transfer to the Next Generation: Beyond Capital Gain Exemption SPECIAL SECTION: 27 2 009/2010 Canadian Farm Advisors Resource Guide 27 Alberta 31 British Columbia 33 Manitoba 37 Nova Scotia 37 Ontario 54 Saskatchewan 62 BUYER’S GUIDE Cultivating Business contents On the cover: CAFA Executive Director Liz Robertson with Rick and Janice Clouston, and their daughter Katie. Rick and Janice operate S & D Clouston Farms, near Selkirk, Manitoba.Premier Edition / www.cafanet.com 7 O ver the past six years as Executive Director of the Canadian Associa- tion of Farm Advisors (CAFA), I have seen great progress made in advancing farm business management across the country. All levels of government, the private sector, agri- cultural associations and educators recognize the importance in calling farming what it is: a business—and one in which professional advis- ors and consultants have a critical role. CAFA is a national, non-profit professional umbrella organization dedicated to assisting farm fam- ilies and businesses by increasing the skills and knowledge of farm advisors. Our members— farm advisors and farm consultants— come from a wide variety of professional backgrounds includ- ing, among others, account- ants, lenders, financial planners, family coaches, lawyers, agrolo- gists, insurance agents, human resource specialists, interested farmers, government staff and educators. There are over 30 CAFA chap- ters across the country that hold regular educational meetings to learn from speakers on mat- ters of common interest, such as new agricultural policies and programs, and trends and issues affecting their farm clients. The meetings and annual provincial conferences also offer opportun- ities to network with other profes- sionals dealing in the sector. CAFA members have a genu- ine commitment to advancing agriculture; not only do they have a professional relationship with farm families and businesses, most also have a personal con- nection. Many members farm, have a spouse that farms, or come from a farm background. A recent meeting highlighted the importance and value in identifying not only one’s profes- sional skills but also niche expertise. Specializa- tion has an important role to play in the future as (specialist) certification programs aim to attract professionals to pursue specific inter- ests and be recognized for their knowledge and skills. CAFA members combine the attributes of their (primary) profession with experience in agribusiness and unique farm family planning needs through a national certification process with CAFA, leading to a Certified Agricultural Farm Advisor. This gives members a competitive advantage through improved marketability and increased value from a designation process that attests to the individual’s skills and experience. The public interest is further protected through the enforce- ment of each profession’s standards through conduct and disciplinary processes established and adhered to by the each member. After attending CAFA chapter meetings and conferences across the country, I am continu- ally impressed with the knowledge and experi- ence that members have on farm business management, which is required for an industry that keeps reinventing itself. In closing, I thank all the volunteers on our national board and our national sponsors (Farm Credit Canada, Scotiabank and TD Canada Trust) along with our provincial sponsors (Allied Financial, Siskinds Law, Collins Barrow in Ontario and BC Dairy Directory). Their ongoing support is so important to CAFA. Last, but certainly not least, the ones who deserve a very big and special thank you are the chapter executives whose leadership has been essential to building a stronger national network of farm advisors and consultants. I hope that you enjoy this premier edition of Cul- tivating Business. This has been an interesting and exciting project. I thank the members who have contributed editorial content and I am proud to be working for every member whose name is listed. They are professionals in every sense and a part of Canada’s future success as a global food producer. Liz Robertson Executive Director Thank you to the following business and organizations for their help distributing this inaugural issue of Cultivating Business. Alberta Beef Producers Alberta Farmers Markets Association Bc Cattlemans Association Bc Dairy Farmers Canadian Agricultural Safety Association Canadian Canola Growers Association Dairy Farmers Of Manitoba Manitoba Cattle Producers Association Manitoba Pork Council National Sunflower Association Of Canada New brunswick Cattle Producers Nova Scotia Cattle Producers Ontario Cattle Feeders Association Ontario Cattlemans Association Prince Edward Island Cattle Producers Saskatchewan Stock Growers Association Valacta Western Canadian Wheat Growers Wild Rose Agricultural Producers Association Executive Director’s Message CAFA Membership Requirements • 2 references from CAFA members • 2 years in an advisory relationship with a farm family or business • Member of a recognized self-regulatory organization or licensing body • No criminal record • Has not declared bankruptcy • Has no professional sanctions against themPremier Edition / www.cafanet.com 9 F armers, by necessity, are con- tinually innovating. Labour costs are higher, fuel costs are higher, fertilizer costs are higher, our dollar is higher; a fellow has to run harder just to stay still. It is surprising that the farm community does not avail themselves of the incen- tives that other industries use for funding research and development. For example, despite talk of food security, history shows that agriculture claims about one-sixth as much as other sec- tors, such as auto- motives—this was even before the recent bailouts. Canada has one of the most generous innovation climates in the industrialized world. The Scientific Research & Experimental Development (SR&ED) program, administered by the Canada Revenue Agency (CRA), awards over four billion dol- lars a year through the tax system alone. The program refunds a substantial percentage (between 20 and 40 percent, and in some cases nearly 60 percent) of any money you outlay on R&D. For smaller operations with no taxes owing, the rebate can be in cash, otherwise it reduces your tax payable. In most prov- inces, there is an additional contribution over and above the federal refund. Eligibility The key is establishing which of your efforts are eligible. Tax interpretation supports the notion of “shop floor” experimental development. For example, the performance of a new blade pro- file in an existing food processor might not be obvious. Further, the blade might have a coating, which might react with an ingredient that only you use. In test- ing these interactions, you conduct an experiment. Various types of expenses qualify for the claim. You can claim the time spent in designing an experimental test, the time spent by persons conducting the tests, and time in activities supporting the experiments, like fabricating test stands. A pre- scribed amount to cover over- heads is generally permitted. The cost of materials con- sumed in the experiments can be claimed, as can materials used in build- ing test items. Equipment specifically obtained for an experiment, for example a five-thousand-dollar ther- mometer, would qualify. In some situations, it is better to lease equipment rather than buy it, in which case the lease payments can be claimed. Outside contracts qualify if they cover supporting activities like design and testing. In assessing claims, CRA uses three criteria. Is the outcome uncertain? If the answer is certain or obvious, there is no need to perform a test or analysis. Is there an advance in knowledge gained? If the answer can be found by looking it up, there is no need for a test. However, sometimes the answer may be proprietary or other- wise guarded, requiring you to perform your own investigation. Finally, was the work systematic? While claims after the work has been performed are allowed, the strongest claims result from intent: here’s what we didn’t know, and here’s how we proposed to find it. Advances don’t have to be major Show ME If you don’t know how to unlock billions in science and research funds, an advisor can give you the key Money the By Ken Bell, PEng, FEC, CAFA, Incentive Access Group Inc.Next >