ONCA Fast Facts: Audits and review engagements

March 17, 2022 | Karima Kanani, Michele Szynkaruk

In October 2021, the Not-for-Profit Corporations Act, 2010 (“ONCA”) came into force. Ontario not-for-profit corporations have three years to transition their governing documents to conform with the ONCA. Our ONCA Fast Facts series explores what is new and different in the ONCA. This week we are discussing audits and review engagements.

At each Annual Meeting, Members of a corporation are required by Ordinary Resolution to appoint an Auditor or person to conduct a review engagement of the corporation.

New in the ONCA is the ability for some corporations to conduct a review engagement in place of an audit or be exempt from the requirements altogether. To determine whether a corporation is entitled to have a review engagement or be exempt from an audit or review engagement you must first consider whether the not-for-profit corporation is a public benefit corporation. (For more information on public benefit corporations, please see ONCA Fast Facts: Public Benefit Corporations).

Public benefit corporations may pass an Extraordinary Resolution to have a review engagement if they have an annual revenue of more than $100,000 but less than $500,000 in any given financial year. If a public benefit corporation has less than $100,000 revenue in a financial year, it has the option to waive both an audit and a review engagement.

Members of a not-for-profit corporation that is not a public benefit corporation may pass an Extraordinary Resolution to have a review engagement instead of an audit if it has an annual revenue of more than $500,000, and can waive both an audit and review engagement if it has an annual revenue of less than $500,000.

An Extraordinary Resolution means a resolution that is submitted to a Special Meeting of the Members of a corporation duly called for the purpose of considering the resolution and passed at the meeting, with or without amendment, by at least eighty per cent of the votes cast, or consented to by each Member of the corporation entitled to vote at a meeting of the Members. An Extraordinary Resolution passed for these purposes is valid until the next Annual Meeting of the Members.

Subject to Member resolutions to conduct a review engagement or to waive audit and review engagement, the Members of the Corporation shall by Ordinary Resolution appoint either an Auditor or a person to conduct a review engagement.

Auditors and persons appointed to conduct a review engagement have a right to receive notice of Member meetings, including Annual and Special Meetings, and notice of audit committee meetings, at which they are entitled to attend and be heard. Further, the Auditor or person appointed to conduct a review engagement may also call a meeting of the audit committee.

Note that not-for-profit organizations receiving government funding should confirm obligations under their transfer payment and accountability agreements, which may require audited financial statements to be obtained and/or submitted.

As not-for-profit corporations begin to prepare for Annual Meetings of Members, consideration should be given to the matters of audits, review engagements and amendments to By-Laws, policies and audit committee terms of reference to reflect rights and obligations set out in ONCA.

Contact our Miller Thomson Health Industry team for Annual Meeting support and compliance review. For more information on the ONCAcontinue to follow our ONCA Fast Facts series:


This publication is provided as an information service and may include items reported from other sources. We do not warrant its accuracy. This information is not meant as legal opinion or advice.

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