Financial Hardship is Irrelevant, Says B.C. Court of Appeal
In a decision released on January 29, 2014, the B.C. Court of Appeal ruled that companies incorporated under the Canada Business Corporations Act must, by operation of law, appoint an auditor, and thereafter produce annual audited financial statements. The Court has no discretion in this respect, and the particular financial circumstances of the company are irrelevant.
The decision of the B.C. Court of Appeal in Li v Global Chinese Press Inc is not particularly revolutionary – lower courts in Ontario ruled in exactly this same way as recently as 2007. But it is the first appellate case in Canada standing for the proposition that shareholders have an absolute right to an auditor and audited financial statements, and therefore it is a noteworthy case. (more…)