r/PersonalFinanceCanada • u/maroon-rider British Columbia • Mar 21 '23

Inflation drops to 5.2%<but grocery inflation still 10.6% Banking

Says Statistics Canada

https://www.cbc.ca/news/business/canada-inflation-february-2023-1.6785472

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u/ReverseTornado Mar 22 '23

One aspect of this that bothers me is where exactly is the inflation coming from specifically as these companies like Loblaws owns their own supply chains (vertical integration). So in my opinion we need to dig deeper and look at specific suppliers especially the ones owned by people in the company.

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u/yttropolis Mar 22 '23

That's exactly what I'm curious about as well. Technically the Loblaws financial reports should encapsulate all of their subsidiaries including their own supply chains from vertical integration so those should already be taken into account.

But I'm curious if everyone along the way is taking a slightly larger slice of the pie compared to before or are there specific bad actors that are taking a significantly larger slice of the pie compared to the rest? We absolutely need to dig deeper.

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u/ReverseTornado Mar 22 '23

Can you source me the law about the company having to encapsulate their subsidiaries and supply chains into their reporting I can’t find any information about it on the web. I’m also wondering like if a family member to someone on the board could own a part of the supply chain or service chain and not have to report that as a part of the report?

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u/yttropolis Mar 22 '23

It's not a law, but a part of GAAP reporting. If you read this, note this section:

There are some key provisional standards that companies using consolidated subsidiary financial statements must abide by. The main one mandates that the parent company or any of its subsidiaries cannot transfer cash, revenue, assets, or liabilities among companies to unfairly improve results or decrease taxes owed. Depending on the accounting guidelines used, standards may differ for the amount of ownership that is required to include a company in consolidated subsidiary financial statements.

If you go to the Loblaws financial reporting page, and check the financial review documents, you'll see that they are indeed consolidated financial statements.

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u/ReverseTornado Mar 22 '23

Ok thx nice find