Richmond Hill's Audit Committee Reviews 2025 External Audit

Richmond Hill's Audit Committee reviewed the city's 2025 external audit, which KPMG said is substantially complete and on track for council approval of the audited financial statements on June 11. Auditors reported one corrected and one uncorrected audit adjustment, no significant internal control deficiencies, and no fraud-related red flags. Committee members also asked about a drop in cash and cash equivalents from about $120 million in 2024 to about $72.5 million in 2025, which staff said reflected higher accounts payable, investments and capital activity.

Topics Discussed

1. 2025 external audit status

KPMG audit partner Maria Kushnoo told the committee the audit of Richmond Hill's consolidated financial statements for the year ended Dec. 31, 2025 is substantially complete, with only minor procedures remaining. She said, "There were there was one corrected and one uncorrected audit adjustment which I'll speak to in a second."

The audited financial statements are scheduled to go to council for approval on June 11.

2. Accounting changes and audit adjustments

The committee heard that changes in public-sector accounting standards affected how investments are reported. A speaker presenting the audit report said, "because of the changes in the accounting standards in the past public sector entities and municipalities they would report all of their investments at cost and fair market value was disclosed but in the books they were recorded at cost."

Kushnoo said the audit included one corrected and one uncorrected adjustment. The article notes provided to the committee say those adjustments related to tangible capital assets, though the meeting transcript excerpt did not include the full explanation.

3. Fraud risk review and internal controls

Auditors told the committee they completed the fraud-risk procedures required under Canadian auditing standards, including work related to management override, journal entries, estimates and unusual transactions. According to the meeting summary, KPMG reported no red flags requiring reporting to the committee and no significant control deficiencies.

4. Cash decline, accounts payable and investments

Councillor Thompson asked about the city's lower cash balance, saying, "we decreased from 120 million approximately down to 72.5 something like that. Um and you know from 2024 to 2025 and it says that it was attributed to capital activity. So I'm just wondering what those capital projects."

Staff said the change was not tied to a single explanation. In response, staff said, "So the change has to do with the investments um overall as well as the accounts payable. So we did have um more higher amount of supplier invoices. So I can't speak to the the actual capital projects that you were questioning, but overall it's a higher payment in accounts payable as well as investments."

That exchange narrowed the explanation from the report's reference to "capital activity" to higher supplier invoices, accounts payable and investments.

5. Other audit findings

The committee also heard that prior-year accounting errors had been corrected and that employee future benefits were supported by an independent actuarial assessment. According to the meeting summary, auditors also reported no issues with the city's investment disclosures and no contingency liability concerns arising from legal claims or insurance coverage.

Motions

Passed: - Recommendations 51 A, B and C

Scheduled: - Approval of the 2025 audited financial statements at the June 11 council meeting

Attendees

• Maria Kushnoo, KPMG audit partner
• Councillor Thompson

The meeting notes provided do not include a full list of committee members present.