Audit procedure

Audit Services conducts audits to ensure that funds earned through a charitable gaming event are used for eligible purposes.

What is an AGLC compliance audit?

An AGLC Compliance audit is a formal examination of your organization’s gaming records. Audits also confirm that your basic internal controls safeguard your gaming funds.

Why is our organization being audited?

Audits make sure all organizations that receive gaming funds follow the standards, policies, conditions and guidelines for receiving and using gaming funds in order to maintain the integrity of gaming activities in Alberta.

Any charitable organization licensed to conduct a gaming event could be audited. The audit selection criteria that determine which charitable organizations will be audited each year are:

• random selection
• past audit results
• status of annual financial filings (ie Financial Reports)
• referrals received, from within AGLC or from members of the public

What time period does the audit cover?

The engagement letter that you receive at the start of the audit states the time period.

How long does an audit take?

The auditor makes every effort to complete the audit as soon as possible. The time frame depends on the complexity of the transactions, the timeliness of responses to auditor questions and requests for extra documentation. If you have any questions on the status of your audit, please contact the auditor.

What is the auditor looking for?

During an audit, the auditor looks for evidence that an organization has followed the standards, policies and guidelines in the handling of gaming funds. Most often the auditor wants to know whether or not:

• gaming funds received from the conduct of a gaming event are deposited into your gaming bank account and spent in accordance with your approved use of proceeds
• gaming events, such as raffles, are conducted according to the applicable handbook policies
• an accurate and complete audit trail of documentation exists to show the amount and purpose of each gaming transaction for both receipts and disbursements

What happens during an audit?

If your organization is being audited, an auditor will:

• contact you by telephone to notify you of the audit and the audit process
• send you an engagement letter that includes a list of the records needed for the audit
• request more information, if needed, once the audit has started
• keep your records safe and the information confidential at all times
• arrange an interview with at least two members of your voluntary executive to discuss the nature of your organization, accounting systems and procedures and the audit process in general
• tour any facilities paid for with gaming funds, if necessary to get a better understanding of your charitable programs
• provide a preliminary report to the group

A preliminary report will:

• be issued once the auditor is satisfied that all of the information requested and queries have been addressed
• identify the instances of non-compliance
• provide an explanation of why the transactions have been deemed non-compliant.

The organization will be given an opportunity to

• respond to the preliminary audit report within approximately 14 days
• comment on what actions have been taken, or will be taken to address the issues raised
• provide supporting documentation for any unsupported payments

Once a response to the preliminary audit report has been received, and any additional documentation submitted has been assessed, or the deadline has passed, a final audit report will be issued.

What happens after the audit is completed?

Once the audit is complete:

• if there are no audit findings requiring a response, only a final audit report is issued
• a Notice of Administrative Sanction letter for Non-Compliance with Policy may be issued to the organization
• the penalty may include a warning or a fine, a licence condition(s) and/or suspension of gaming licence(s)
• the charitable organization must repay the gaming bank account the amount of any gaming funds that were not spent in accordance with the policies, conditions and guidelines
• the Licensing Branch (and if applicable the Investigations Branch) manage severe deficiencies which may delay or deny future gaming applications

If the organization is issued a Notice of Administrative Sanction:

• a Consent to Administrative Sanction form will be provided
• the organization is to indicate in the appropriate box the decision regarding accepting the administrative sanction or proceeding with a Board Hearing if the organization refutes any or all of the findings in the final audit report
• the form must be returned to AGLC within the specified time
• failure to return this form will result in the imposition of the sanctions set out in the Notice of Administrative Sanction

Details on the hearing process can be found on AGLC website: Board Hearings and Procedures

Post-audit questionnaire

Following the audit, you will be sent a questionnaire via email. The purpose of the questionnaire is to obtain feedback on the audit and the audit process itself. We encourage you to take the time to complete the questionnaire since your feedback will help us to improve how we conduct our audits going forward.

Authority

Gaming and Liquor Act, section 100

“Every licensee or registrant must, when required in writing by the Commission, provide the Commission with reports and information specified by the Commission for the purposes of determining if this Act and the conditions imposed on the licensee’s licence or registrant’s registration are being complied with.”

The auditor can examine all of your gaming records and activities and may enter your business premises to inspect your records. Non-gaming records may be requested in cases where grant revenue or other revenue was generated that should have been offset against gaming expenditures or in cases where gaming funds were transferred to a non-gaming bank account.

Freedom of Information and Protection of Privacy Act

Any data or information concerning the organization, other than data or information available as a matter of public record, which is obtained by AGLC in performing this compliance audit shall be collected and managed in accordance with the provisions of the Freedom of Information and Protection of Privacy Act, R.S.A. 2000, c-25, as amended.

Questions?

Please contact: ComplianceAudit@aglc.ca.