Tim Hudak, the MPP for Erie-Lincoln, and the finance critic for the Progressive Conservatives at Queen's Park in Ontario, has focused in on the changes being proposed to expand the powers of the Canadian Public Accountability Board. The CPAB is a creation of the Ontario Securities Commission (in concert with other provincial securities commissions), and in Bill 151, Dalton McGuinty's Liberals propose to require accountants to provide all material used to prepare audits to the CPAB for inspection, including material that is considered privileged.

I've written quite a bit about Bill 151, and some people think that I am off base with my concerns. Still, the Ontario Bar Association is deeply concerned, and that concern was brought to the attention of the legislature last Wednesday by MPP Tim Hudak:

Let me move on to other aspects of the bill. I want to express some concerns. We look forward to, and I would fully expect, hearings on the bill. I'm skipping from A to D, schedule D on the Canadian Public Accountability Board Act -- and I appreciate the briefing I had today -- to talk a bit about the Canadian Public Accountability Board. Given the limits on my time, I won't get into great detail here. I do want to highlight some concerns by various groups about what this bill will do.

If you go to the Ontario Bar Association's website, for example, there's a letter on that website from James Morton, president of the Ontario Bar Association, that has some significant concerns about schedule D of this bill. To read part of Mr. Morton's letter:

"However, the pressing matter at hand as this bill is now before the House for second reading debate is the matter of solicitor-client privilege. Given that this is a fundamental principle for our profession, it is disappointing that there was no contact with relevant stakeholder groups in the legal profession for input in the development of this legislation.... [W]e continue to have significant concerns pertaining to section 11(4) requiring a participating audit firm to provide information or documents to the board even where that information or documents are privileged."

So I look forward to an opportunity here. It does give one concern that a group of the significance of the Ontario Bar Association was not consulted before schedule D was brought forward to the Ontario Legislature. I hope we'll have ample committee hearings so that groups like the OBA can come forward and we can hear directly from the minister and finance staff on how they're going to address this issue. I know that the CGA, the Certified General Accountants, also have concerns about provisions in that aspect of the bill, and I hope they'll have that opportunity in the time ahead.

Now that the opposition has this section of the bill in its sights, expect that the hearings will be anything but pro forma approvals, not now that the Conservatives have the OBA as allies.

Will the section, and the CPAB's new powers, survive the committee process? Will the government simply remove the offending portion in order to get the rest of this massive bill through? Or will the OSC dig in and demand that the CPAB be given the powers it needs to get around the legal hurdles it has encountered in the past?

Posted by: Steve Janke at 06:53 PM | Comments (2) | Add Comment
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