The Canadian Film Industry
With TIFF around the corner, film and cinema is on everyone’s minds. Who will be recognized this year and which films will debut at the prestigious festival? With film markets scattered across the globe, the Canadian film industry sees high competition to break through and see monetary success. Working with Telefilm Canada, a crown corporation, the Canadian film industry has seen slow, but steady, growth. This month, Business Review Canada highlights the Canadian film industry, its issues and successes.
Canada’s Film Industry Competition
Although many actors, directors and producers are Canadian-born, many did not get their start in Canada due to the lack of Canadian film popularity. As the market is so close to and competes directly with the US, the more popular market brings high competition for Canadian artists. Bringing in only 3.1 per cent of the total Canadian box office in 2010, it’s clear the Canadian film industry needs to step up its game, but the question is: how?
Telefilm got its start in 2001, as an initiative from the Canadian Feature Film Policy, managing the Canadian Feature Film Fund. With goals of building larger Canadian and international audiences, Telefilm Canada helps fund Canadian film projects with its annual budget of $100 million.
Today, Telefilm Canada’s help and support of the industry has seen slow but steady successes. In its fiscal 2010-2011 year, Telefilm backed films that won 127 awards worldwide.
Canadian Film Industry Growth
Although the industry is still relatively small, at least revenue wise, help from governmental funding as well as organizations that support Canadian film has helped the industry grow. In July 2012, Telefilm Canada announced that the Canadian film industry, including both English and French films, is now enjoying greater success at home and abroad. Utilizing its Success Index, Telefilm Canada was able to recognize that its portfolio of funded films had improved 23.7 per cent in 2011 in comparison to 2010. Grossing 11.6 per cent more revenue in domestic box office receipts because of popular movies such as Starbuck, Barney’s Version, Gerry, and Breakaway, the Canadian film industry not only is starting to compete at a higher level, but can also compete on multiple fronts—the Canadian independent film industry currently holds 20 per cent of its category’s domestic box office sales.
Even further, films made in Canada are seeing an increase in recognition. Feature films backed by Telefilm did well in 2011, with 68 receiving festival award nominations and 31 bringing in international awards while 27 grabbed awards in Canada. This is reflected in the fact that Canadian films are also distributing further than ever before, becoming in demand in over 100 countries.
Another important factor is that the top 10 Telefilm Canada funded films have brought in a combined $140.2 million in foreign and US sales, $126.5 million of that earned in 2006-2010.
“These results show that Canadian films perform remarkably well outside Canada, and confirm the importance of our new Success Index and its cultural, industrial and commercial approach, which takes into account not just domestic box office but also gross international sales,” said Carolle Brabant, Executive Director of Telefilm Canada. “Encouraging the diversification of revenue sources, including coproduction, is a priority for Telefilm, aimed at helping maintain a strong industry.”
Six issues at the top of tax and finance leaders’ agenda
New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.
According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.
And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.
Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.
Trend 1: Businesses seek more strategic counsel from tax
Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.
According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”
Trend 2: Tipping point for resourcing models
Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.
Trend 3: Digital tax administration is moving faster than expected
in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.
"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."
Trend 4: Data simplification and lower-cost resourcing are top priorities
Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.
At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”
Trend 5: Skillsets are shifting
Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.
Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact
Trend 6: 2020 brought productivity improvements
Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.