Bank Act

Marginal note:Appointment of auditor

• 585 (1) An authorized foreign bank shall appoint a firm of accountants as auditor for its business in Canada and shall notify the Superintendent in writing of the name and address and date of appointment of the auditor without delay after making the appointment.

• Marginal note:Qualification of auditor

  (2) A firm of accountants is qualified to be an auditor if

  • (a) two or more of its members are accountants who

    • (i) are members in good standing of an institute or association of accountants incorporated by or under an Act of the legislature of a province,

    • (ii) have at least five years experience at a senior level in performing audits of a financial institution,

    • (iii) are ordinarily resident in Canada, and

    • (iv) are independent of the authorized foreign bank; and

  • (b) the member of the firm jointly designated by the firm and the authorized foreign bank to conduct the audit of the authorized foreign bank on behalf of the firm is qualified in accordance with paragraph (a).

• Marginal note:Independence

  (3) For the purposes of subsection (2),

  • (a) independence is a question of fact; and

  • (b) a member of a firm of accountants is deemed not to be independent of an authorized foreign bank if that member, a business partner of that member or the firm of accountants

    • (i) is a business partner, director, officer or employee of the authorized foreign bank or of any affiliate of the authorized foreign bank or is a business partner of any director, officer or employee of the authorized foreign bank or of any affiliate of the authorized foreign bank,

    • (ii) beneficially owns or controls, directly or indirectly, a material interest in the shares of the authorized foreign bank or of any of its affiliates, or

    • (iii) has been a liquidator, trustee in bankruptcy, receiver or receiver and manager of any affiliate of the authorized foreign bank within the two years immediately preceding the proposed appointment of the firm of accountants as auditor, other than an affiliate that is a subsidiary of the authorized foreign bank acquired pursuant to subsection 519(2).

• Marginal note:Business partners

  (3.1) For the purposes of subsection (3), a business partner of a member of a firm of accountants includes

  • (a) another member of the firm; and

  • (b) a shareholder of the firm or of another business partner of the member.

• Marginal note:Notice of designation

  (4) Within fifteen days after the appointment of a firm of accountants as auditor, the authorized foreign bank and the firm shall jointly designate a member of the firm who meets the qualifications described in paragraph (2)(a) to conduct an audit under subsection 592(1) on behalf of the firm and shall without delay notify the Superintendent in writing of the designation.

• Marginal note:New designation

  (5) Where for any reason the member designated under subsection (4) to conduct an audit ceases to conduct the audit, the authorized foreign bank and the firm of accountants may jointly designate another member of the same firm who meets the qualifications described in paragraph (2)(a) to conduct the audit and the authorized foreign bank shall without delay notify the Superintendent in writing of the designation.

• Marginal note:Deemed vacancy

  (6) In any case where subsection (5) applies and a designation is not made pursuant to that subsection within thirty days after the designated member ceases to conduct the audit, there shall be deemed to be a vacancy in the office of auditor of the authorized foreign bank.