May 6, 1998

 To:The Audit Committee

 From:Jeff Griffiths

City Auditor

 Subject:1997 Financial Audits of Bloordale Village Business Improvement

Area and Gerrard India Bazaar Business Improvement Area

 Recommendation:

 It is recommended that this report be received for information.

 Background:

 The Auditor of the former City of Toronto is required by statute to complete the 1997 financial audits of the former City of Toronto, including its local boards, agencies and commissions. In accordance with this requirement, the Auditor of the former City of Toronto has completed his 1997 audits on a number of the Business Improvement Areas within the former City. These financial statements including the appropriate audit reports have been submitted to the Audit Committee of the new City of Toronto.

 Comments:

 The Auditor of the former City of Toronto in conducting his audit work at Bloordale Village Business Improvement Area and Gerrard India Bazaar Business Improvement Area was not able to issue a standard audit report due to the fact that there was not adequate documentation available to support such a report. In the case of the Bloordale Village Business Improvement Area, the amounts in question were approximately $7,500, and in the case of the Gerrard India Bazaar Business Improvement Area, the amounts in question were approximately $11,000.

 I have expressed my concerns in relation to this issue to both the Auditor of the former City of Toronto and the Treasurer and Chief Financial Officer of the new City of Toronto. In this regard, I requested the Auditor of the former City of Toronto to outline in a management letter to both Business Improvement Areas the extent of the problems which necessitated the qualified audit report and to recommend a course of action to remedy the problem in 1998. The appropriate correspondence relating to this matter will be forwarded to a future meeting of the Audit Committee. I have also requested the Chief Financial Officer and Treasurer to contact both organizations, in order to determine whether any future accounting assistance could be provided.

  Conclusion:

 Action has been taken to remedy the accounting problems at both the Bloordale Village Business Improvement Area and the Gerrard India Bazaar Business Improvement Area. Such actions should permit the Auditor of both Business Improvement Areas to submit an unqualified audit report in 1998.

 Contact Name and Telephone Number:

 John Woods, Auditor, former City of Toronto, 392-7172.

 Jeffrey Griffiths

City Auditor

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