THE ONTARIO AGGREGATE RESOURCES CORPORATION

The collection of aggregate resources charges (licence fees, aggregate permit fees, wayside permit fees and crown royalties) is one of the Trust’s important functions. To provide assurance to the recipients of these charges that this function is being performed properly, TOARC undertakes annual audits of production reported by licensees and permittees. Article 8.01 of the Trust Indenture specifies that:

"The Trustee may employ, remunerate and direct such persons as may be designated by the Crown, as inspectors, pursuant to section 4 of the Act, to conduct and perform inspections and audits of Licensees and Permittees for the purpose of obtaining and verifying the information required by the Trustee in order to carry out and fulfil the Trust Purposes.”

Licensees and permittees may be selected for audits based on a process of random selection from a list of all aggregate producers, but also based on geographical location and type of instrument (licence or permit). Further, a licensee or permittee may be the subject of an audit for the following reasons:

1. An MNR inspector has submitted a written request asking for a production audit of a specific licence/permit.
2. TOARC may initiate the audit of a specific licence/permit based on unusual variations in reporting or unaccountable changes to the production report submitted, etc.
3. A licensee or permittee found guilty of improper reporting may be the subject of further audits to check for compliance.

In 2001 the firm BDO Dunwoody LLP has been engaged to assist TOARC staff broaden the Audit Program. This will ensure that aggregate producers in all areas of the province are aware of and are adhering to the Aggregate Resources Act when reporting their annual production.

If you are notified that your reporting of production will be audited you will be asked to have the following records available for inspection:

1. Financial Statements
2. Sales/Production Reports
3. Invoice Register
4. Invoices
5. General Ledger detail
6. Payables for purchased aggregate materials
7. Files used to complete the original production report
8. Weigh Tickets (if required/applicable)

For the benefit of the recipients of the aggregate resources charges (local municipalities, counties, regions and the Province), the audit program is meant to ensure that all producers understand their obligations and report fairly on their annual production.