Town of View Royal 2019 Audit Findings Report to the Mayor and Council
A report from MNP LLP outlining the results of the 2019 financial audit, including materiality levels and audit status.
Town of View Royal
2019 Audit Findings
Report to the Mayor and Council
December 31, 2019
Cory Vanderhorst CPA, CA, T: (250) 753-8251 E: cory.vanderhorst@mnp.ca
OVERVIEW
We are pleased to submit to you this Audit Findings Report (the “Report”) for discussion of our audit of the consolidated financial statements of the Town of View Royal (the “Town") as at December 31, 2019 and for the year then ended. In this report we cover those significant matters which, in our opinion, you should be aware of as members of the Mayor and Council.
As auditors, we report to the Mayor and Council on the results of our examination of the consolidated financial statements of the Town as at and for the year ended December 31, 2019. The purpose of this Report is to assist you, as members of the Mayor and Council, in your review of the results of our audit.
This Report is intended solely for the information and use of the Mayor and Council and management and should not be distributed to or used by any other parties than these specified parties.
We appreciate having the opportunity to meet with you and to respond to any questions you may have about our audit, and to discuss any other matters that may be of interest to you.
ENGAGEMENT STATUS
We have completed our audit of the consolidated financial statements of the Town which has been carried out in accordance with Canadian generally accepted auditing standards and are prepared to sign our Independent Auditor's Report subsequent to completion of the following procedure:
- the Mayor and Council review and approval of the consolidated financial statements
No significant limitations were placed on the scope or timing of our audit.
INDEPENDENT AUDITOR’S REPORT
We expect to have the above procedure completed and to release our Independent Auditor’s Report on May 20, 2020.
Unless unforeseen complications arise, our Independent Auditor’s Report will provide an unmodified opinion to the Mayor and Council of the Town. A draft copy of our proposed Independent Auditor’s Report has been included with this report. The matters disclosed in the Independent Auditor’s Report are discussed further in the relevant sections of the Report.
AUDIT REPORTING MATTERS
Our audit was carried out in accordance with Canadian generally accepted auditing standards, and included a review of all significant accounting and management reporting systems, with each material year end balance, key transaction and other events considered significant to the consolidated financial statements considered separately.
SIGNIFICANT AUDIT, ACCOUNTING AND REPORTING MATTERS
| AREA | COMMENTS |
|---|---|
 CHANGES FROM AUDIT SERVICE PLAN |
Over the course of our audit, the following deviation was made from the Audit Service Plan: Materiality was reduced from $700,000 per the Audit Service Plan to $680,000. This change resulted from a difference in annual revenues from preliminary to actual, as we use the Town's annual gross revenue to calculate materiality. |
 FINAL MATERIALITY |
Final materiality used for our audit was $680,000 for December 31, 2019. |
 IDENTIFIED OR SUSPECTED FRAUD |
While our audit cannot be relied upon to detect all instances of fraud, no incidents of fraud, or suspected fraud, came to our attention in the course of our audit. |
IDENTIFIED OR SUSPECTED NON-COMPLIANCE WITH LAWS AND REGULATIONS |
Nothing has come to our attention that would suggest any non-compliance with laws and regulations that would have a material effect on the consolidated financial statements. |
MATTERS ARISING IN CONNECTION WITH RELATED PARTIES |
No significant matters arose during the course of our audit in connection with related parties of the Town. |
GOING CONCERN |
We have not identified any material uncertainties related to events or conditions that may cast significant doubt on the Town's ability to continue as a going concern. We are of the opinion that the going concern assumption is appropriate in preparation of the consolidated financial statements. |
AUDITOR’S VIEWS OF SIGNIFICANT ACCOUNTING PRACTICES, ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES |
The application of Canadian public sector accounting standards allows and requires the Town to make accounting estimates and judgments regarding accounting policies and financial statement disclosures. As auditors, we are uniquely positioned to provide open and objective feedback regarding your Town’s accounting practices, and have noted the following items during the course of our audit that we wish to bring to your attention. The accounting policies used by the Town are appropriate and have been consistently applied. |
FINANCIAL STATEMENT DISCLOSURES |
The disclosures made in the notes to the consolidated financial statements appear clear, neutral and consistent with our understanding of the entity and the amounts presented in the consolidated financial statements. |
MATTERS ARISING FROM DISCUSSIONS WITH MANAGEMENT |
There were no significant matters discussed, or subject to correspondence, with management that in our judgment need be brought to your attention. |
OTHER AREAS
| AREA | COMMENTS |
|---|---|
| AUDITOR INDEPENDENCE | We confirm to the Mayor and Council that we are independent of the Town. Our letter to the Mayor and Council discussing our independence is included as part of the additional materials attached to this report. |
| MANAGEMENT REPRESENTATIONS | We have requested certain written representations from management, which represent a confirmation of certain oral representations given to us during the course of our audit. |
| SUMMARY OF SIGNIFICANT DIFFERENCES | No significant differences were proposed to management with respect to the December 31, 2019 consolidated financial statements. |
We appreciate having the opportunity to meet with you and respond to any questions you may have about our audit, and to discuss any other matters that may be of interest to you.
Sincerely,
MNP LLP Chartered Professional Accountants
Independence Communication
May 19, 2020
Mayor & Council Town of View Royal 45 View Royal Avenue Victoria, BC V9B 1A6
Dear Mayor & Council:
We have been engaged to audit the consolidated financial statements of the Town of View Royal (the "Town") as at December 31, 2019 and for the year then ended.
CAS 260 Communication With Those Charged With Governance requires that we communicate with you matters that are significant to our engagement. One such matter is relationships between the Town and its related entities or persons in financial reporting oversight roles at the Town and MNP LLP and any affiliates (“MNP”) that, in our professional judgment, may reasonably be thought to bear on our independence. In determining which relationships to report, the Standard requires us to consider relevant rules and related interpretations prescribed by the appropriate professional accounting body and applicable legislation, covering such matters as:
(a) Holding a financial interest, either directly or indirectly, in a client; (b) Holding a position, either directly or indirectly, that gives the right or responsibility to exert significant influence over the financial or accounting policies of a client or a related entity; (c) Personal or business relationships of immediate family, close relatives, partners or retired partners, either directly or indirectly, with a client or a related entity; (d) Economic dependence on a client; and (e) Provision of non-assurance services in addition to the audit engagement.
We are not aware of any relationship between the Town and MNP that, in our professional judgment, may reasonably be thought to bear on our independence, which have occurred from January 1, 2019 to May 19, 2020.
We hereby confirm that MNP is independent with respect to the Town within the meaning of the Rules of Professional Conduct of the Chartered Professional Accountants of British Columbia as of May 19, 2020.
This report is intended solely for the use of Council, management and others within the Town and should not be used for any other purposes.
We look forward to discussing with you the matters addressed in this letter as well as other matters that may be of interest to you at our upcoming meeting. We will be prepared to answer any questions you may have regarding our independence as well as other matters.
Sincerely,
MNP LLP Chartered Professional Accountants
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