Financial Controls 7: Audits and Fraud
Fraud is rare at housing co-ops, but is always a threat. Financial controls help reduce the risk of it happening, and audits increase the odds of catching problems early. Fortunately, housing co-ops go through audit processes by default.
The Co-op Act includes specific provisions around audits. Look at section 108 and 109 in particular.
- s.108(1): Subject to section 109(1), every association must have an auditor.
- s.108(3): Subject to section 109(1), an association, at each annual general meeting, must appoint an auditor by ordinary resolution to hold office until the close of the next annual general meeting, but if an appointment is not made at that meeting, the auditor in office continues as auditor until a successor is appointed.
- s.109(1): An association that is not a reporting association may waive the appointment of an auditor (a) by a special resolution of members, and
- s.109(2): A resolution referred to in subsection (1) is effective for one financial year of the association.
Co-ops with operating agreements or leases should confirm any additional requirements around audits.
