Printed . This content is updated regularly, please refer back to https://bcfsa.ca to ensure that you are relying on the most up-to-date resources.
What to Expect During a Real Estate Audit
BCFSA helps protect consumers and monitor market conduct activities by auditing brokerages in B.C. Audits can identify and address harmful real estate-related business practices and ensure brokerages and licensees are complying with the legislation.
This article provides an overview of how our audit program operates so that you, as a managing broker, can be better prepared during an audit.
A Look at the Audit Process
Initial Interview
When a brokerage is selected for an audit, BCFSA will contact you to schedule an initial interview and request documents relevant to the audit.
During the initial interview, a BCFSA auditor will ask you questions about the brokerage’s activities when it comes to trading services, rental property management, and strata management, if applicable.
You may request to have relevant brokerage staff present, including the bookkeeper, conveyancer, and brokerage owner.
Review of Documents
You should be prepared to provide documents that may include the following:
- Bank reconciliations, bank statements, trust liability and asset reconciliations, trust ledgers, and other records of the brokerage’s trust accounts;
- Bank reconciliations, bank statements, general ledgers, and other records of the brokerage’s non-trust bank accounts; and
- Documents related to specific trades and/or rental and strata properties, depending on what the brokerage is licensed for.
Exit Interview
The auditor will schedule an exit interview with you to discuss the audit results and give you an opportunity to ask questions and provide comments.
The audit findings will be delivered to you in an Audit Report. For each observation in the Report, you must provide a written response detailing the measures the brokerage will take to ensure compliance.
What Happens When Serious Deficiencies Are Detected
It’s important to ensure your brokerage is operating in accordance with B.C. legislation. If the auditor observes serious deficiencies while reviewing the brokerage’s documents, BCFSA could take further action, including:
- Issuing a Letter of Advisement;
- Conducting a follow-up audit;
- Issuing an Administrative Penalty; and/or
- Forwarding the file to our Investigations or Legal Department.
More Information
View more details about the audit process on our Real Estate Audit Program page. For audit-related questions, contact BCFSA’s Audit and Assurance Team.
