The Real Estate Council of Alberta (RECA) has, as its mandate, to set and enforce standards of conduct for the industry. It is also required to provide services that enhance and improve the industry and the business of industry members. One of the ways that RECA meets this mandate is through its audit program.
The audit program provides positive, constructive assistance to industry members with respect to accounting and legislative requirements by:
- providing advice related to trust accounts and record keeping;
- developing effective record keeping and administrative procedures; and,
- identifying and resolving potential problems.
RECA’s audit program also serves to:
- reduce the activities in violation of the Real Estate Act or the Rules;
- safeguard the integrity of the licensing system; and,
- reduce the number of claims against the Assurance Fund.
The periodic inspection of brokerage books and records are called audits.
RECA’s audit unit is comprised of a working manager called the audit coordinator, a team of auditors and an audit administrator. RECA auditors have comprehensive training and experience enabling them to audit all industry sectors.
The audit coordinator is responsible for the day-to-day supervision of RECA’s audit program. The audit coordinator’s responsibilities include reviewing the annual accountant reports; selecting brokerages to be audited; carrying out some of larger, more complex audits; and, responding to questions from brokerages and accountants regarding trust accounts, books and records. The audit coordinator also participates in the furtherance of RECA’s strategic plan, which may involve developing audit guides, interpretation guidelines, and changes to forms and legislation.
In addition to the audit coordinator, RECA has two auditors who travel to brokerages throughout the province. The auditors are responsible for carrying out audits of the books and records of real estate and mortgage brokerages, and real estate appraisers, and assisting brokers and appraisers with preventing or rectifying practices that are not in compliance with legislation.
The audit unit also includes an audit administrator, who is responsible for sending out accounting report packages to every brokerage annually at their fiscal year-end; ensuring reports are received fully completed and within the required time period; following up with brokerages if reports are not received within the required time period; and, answering questions from brokers and accountants in relation to the reports.
One of the fundamental responsibilities of any self-regulatory body is to conduct investigations and take disciplinary action when necessary. RECA’s investigations unit conducts three types of investigations. The types of investigations conducted by the investigations unit include:
- investigations into unauthorized activity;
- investigations into the conduct of industry members; and,
- investigations into the background of individuals and circumstances associated with a licence applications to ensure that licences are issued in the public interest.
The investigations unit is led by the director of audit and investigations and is supported by the investigations coordinator, a team of investigators, three complaint analysts and an administrative support position. The investigation unit strives to assemble an investigative team which is partly composed of former industry members from the various industry sectors.