NorthBridge Consulting Services

November 2010

Issue 25

This Issue: The Commercialization of Innovation TestimonialEmployee ProfileNorthBridge EventsTrade, Innovation & ProsperityGrant & Loan GuideOn The BlogData Collection Through the SRED Process

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The Commercialization of Innovation

There’s been talk lately about how Canadian companies aren’t doing as well as other countries when it comes to commercializing our innovations. Back in February, the Conference Board of Canada gave Canada a “D” for commercializing our innovation – ranking us 14th out of 17 countries for the ability to turn knowledge into commercialized products and services.

Since then, there have been studies initiated (and some completed), opinions given and much debate as to what can be done to help Canadians bring their products to market. In October, even the federal government launched a review on R&D that is being done in Canada and the lack of commercialization resulting from this R&D. While nothing has been decided on yet, there have been many recommendations that can bring about hope that we can improve the commercialization of our R&D products – including recommendations that the SR&ED program is expanded to include additional expenditures, that public companies receive the same percentage of money back from the SR&ED program as private companies, and that the federal government purchase these innovative products to help encourage the adoption of the products into the market. At this point, these are all just recommendations, but if adopted, any of them could mean a huge boost to the profitability that Canada gets from its R&D.

That's not to say that there aren’t companies who are successfully able to bring innovative products to the market already – not only has everyone seen what the big Canadian players in the R&D field (such as RIM) can do, but each and every day we at NorthBridge get to see what you, our clients, can do.

What it does mean, however, is that overall compared to other countries we don’t profit as much from the sale of products that are considered innovative.

One of the biggest reasons for this is that we don’t sell as many of these innovative products internationally as other countries do. Our largest exports are still natural resources and raw products. In order to increase the number of innovative products that we export, we need to work on improving our abilities to export already developed products, develop more products that would appeal to an international market, and perhaps focus on processing the raw products and natural resources we already have before exporting them.

Whatever it is that we end up doing to improve Canada’s profitability from R&D is going to take a lot of hard work, but we know that Canada is up to it. We know that you are up to it. And for all of the dedication that you put towards new and improved innovative products, you will see us as dedicated to working with you to help you get the highest SR&ED refund that you are eligible for.


"Before working with NorthBridge Consulting Services, we didn’t realize that metal recycling activities would be eligible for the SR&ED program. They helped us recognize that what we were doing qualified for the program. We found that NorthBridge was able to make the SR&ED program easy to understand, and with their guidance we were able put together a claim that was accepted as filed."

The name of this company has been with-held at the request of the company.

Employee Profile: Eric O’Grady

Position SR&ED Team Specialist
Years working in industry 26 years in a variety of industries such as Power Cable Manufacturing, Automation & Robotics and Automotive Parts Manufacturing
Educational background Master of Engineering Degree in Mechanical Engineering
Professional Memberships and Designations Professional Engineer (P.Eng)
Hobbies/Interests Music, Golf, Camping, Fishing, Soccer
Biggest non-work-related accomplishment Immigrating alone to Canada

NorthBridge Events

Dates to Remember

November 11th: Remembrance Day
November 30th: May 2009 FYE claims due now

Trade, Innovation and Prosperity

The Institute for Competitiveness & Prosperity recently released a working paper, September 14, 2010 titled ‘Trade, Innovation and Prosperity.’ The Institute is an independent not-for-profit organization established in 2001 to serve as the research arm of Ontario’s Task Force of Competitiveness, Productivity and Economic Progress. The mandate of the Task force is to measure and monitor Ontario’s competitiveness, productivity, and economic progress compared to other provinces and US states and to report to the public on a regular basis. The released paper highlights the following as issues within Canada:

  • Our productivity performance is poor
  • Our businesses perform less R&D than their counte parts in most developed economies
  • We produce far fewer patents per population compared to our US counterparts
  • We invest less in advanced information and communications technology
  • Our clusters or traded industries are not as competitive as their US counterparts

A complete copy of the working paper can be found at:

Grant and Loan Guide

ACC Farmers’ Financial

Are you an agricultural producer looking for financing to help your business grow? ACC Farmers' Financial has been working with agricultural producers since 1992, when they were formed by a coalition of farm organizations. Since that time, they have provided nearly two billion dollars in operating funds to Canadian producers in a number of different agricultural areas including the production of greenhouse and field vegetables, floral products, grains for commercial sale, animal feed, nursery products, livestock and more.

ACC Farmers' Financial doesn’t just provide financing for one small portion of your agricultural business – they provide financing in all areas of the development of your products, from planting, through harvesting, right until your product goes to market.

Among other financial services, ACC Farmers' Financial has two main loan programs available. The Commodity Loan Program, which can provide up to 14 months of input financing for processing vegetables, grains and oilseeds. Eligible companies can receive up to $750,000 at Prime Interest Rate (currently 3.0%). The second loan program is the Advance Payments Program, which provides up to 18 months of financing for commodities that will be commercially sold, such as grains and oilseeds, vegetables, livestock, and even potted plants. Eligible companies can receive up to $100,000 interest-free, with an additional $300,000 available at Prime Interest Rate.

With affordable financing, no hidden costs, and innovative financing solutions that are almost never offered by traditional lenders, the services provided by ACC Farmers' Financial are a great supplement to the SR&ED program for companies who are working in the agricultural industry.

If you are interested in the services available through ACC Farmers' Financial and would like additional program information, please contact their office at 1-888-278-8807 or visit

This is information of a general nature only; NorthBridge does not necessarily assist companies applying for the grants and loans listed above. Projects may not be eligible for more than one grant or loan; receiving funding from one grant or loan may disqualify that project from others, including the SR&ED program. Please speak with your Account Manager for more information.

On the Blog

NorthBridge continues to bring you the latest updates and hot topics that are important to our clients. Some of our October highlights:

Sustaining Canada’s Economic Recovery Act. We highlight key points on the Act that was developed to be a key component of Canada’s Economic Action Plan.

R&D Review by Federal Government. The federal government has created a panel to review the state of R&D in Canada.

August’s Manufacturing Sales. We take a look at the highlight’s of August’s manufacturing sales - overall, the manufacturing industry increased sales by 2%.

Read about these topics and more on our Canadian Business Blog at

Data Collection Through the SRED Process

Part 1: The Initial Claim: What you need to file a solid claim

NorthBridge prides itself with having the best claim submissions in the industry but the information provided to the CRA is only as good as the data collected from our clients. A key part of the process is having skilled technical interviewers who facilitate the gathering of the volumes of required information for each claim submission. Each of the four stages of document control are critical to gaining access to the entitled funds, and maintaining access to this revenue stream going forward. The first stage in the process is to collect pertinent data relative to R&D activities retroactively over two fiscal periods.

What we are looking for involves projects where a product or process was developed or improved upon. To begin identifying the projects and the associated supporting technical & financial materials try looking at:

Contractor invoices. This is a great starting point for identifying where money was spent modifying, tweaking and improving existing processes or products. The invoices can also shine a light on projects which were long forgotten but still qualify as eligible expenditures.

Internal correspondence. Looking through old emails, meeting notes and log books often give excellent information on project specifics such as people involved, timelines, metrics, project objectives and results.

Schematics & designs. A visual representation often is the best way to stimulate a brainstorming session when looking for projects and past data. Printing off and reviewing drawings and schematics of projects (even building expansion plans) often leads to compiling of associated data from other sources which can be cross-referenced with the images. Make some notes right on the schematics and use them as a starting point!

Management team pow-wow. Have one of our technical engineers come in and meet with key people involved in the company's operations. Let us explain exactly what we are looking for in each department and get the gears turning. We then follow up with each individual to drill deeper and grab as much information as possible with the least impact on daily operations.

Client issued invoices. While you cannot claim for time already expensed to a customer, identifying large projects from the books sometimes allows us to find eligible expenditures for lost labour. For example, you take on a project that is completely new to your company. It takes two months to develop the tools and methods to work on it, but you only bill the client for one week of work. There are sometimes lost labour hours where technological advancement was occuring, and these hours are eligible.

Financials. Having an open dialogue with the internal controller or CFO is paramount to completing a rock solid claim. He/she has the nuts and bolts which we need to create the secondary part of the submissions: the financial reports. Simply looking at the titles and roles of the key employees can give us an initial direction of where to start drilling for information. Going through scrapped materials logs also gives us an indication of where projects might have run into issues or failed completely (Remember: even failed projects still qualify). Working hand-in-hand with the internal accounting people allows us to ensure the best claim becomes even better.

These tips are just a starting point to get the ball rolling in terms of collecting data for each project submission. We make the process as simple as possible and walk you through each step to ensure a complete data capture is achieved. This produces the highest quality claim possible, making the CRA happy and helping you to get your refund faster.

NEXT MONTH: Part 2 - Once you've filed, what's next?

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While we endeavor to ensure accurate information through this newsletter, it is not a definitive analysis of legislation, or a substitute for professional advice. Please seek professional advice if attempting to relate specific situations to the information disclosed within.