The Law Society of Upper Canada’s (“the Society”) audited financial statements present the operational results and financial position of the General Fund, the Compensation Fund, the Errors & Omissions Insurance Fund (“E&O Fund”) and other restricted funds. Separate financial statements have been prepared for the Society’s subsidiaries: Lawyers’ Professional Indemnity Company (“LAWPRO”) and LibraryCo Inc. (“LibraryCo”).
The annual financial statements were approved by Convocation on April 23, 2015, and show the Society continues to maintain a strong financial position.
Summary of Financial Performance
The lawyer and paralegal General Funds, which account for the Society’s program delivery and administrative activities, are reporting a combined operating surplus of $2.6 million, approximately the same as in 2013 and better than the budgeted deficit. Annual fees, professional development revenues, investment income and other revenues are above budget and virtually all of the major expense categories in the General Funds are less than budget.
Professional regulation expenses increased with the first full year of the Tribunal office. The number of registrants for the lawyer and paralegal licensing processes continued to increase although the total number of continuing professional development registrants decreased, primarily in the nominal fee programming. The lawyer licensing process has been heavily engaged in the implementation of the Pathways Pilot Project, including the Law Practice Program leading to an increase in expenses.
The Society’s restricted funds are reporting a combined deficit of $18.5 million in 2014 (2013 - $1.3 million surplus). The two primary reasons for the restricted funds deficit in 2014 are:
- The Lawyer Compensation Fund experienced an adverse claims experience, primarily from two large scale alleged defalcations, resulting in a deficit of $10.2 million compared to a surplus of $498,000 in 2013.
- Premium transfers to LAWPRO, anticipated in the insurance contract, resulted in a deficit in the Errors & Omissions Insurance Fund of $5.2 million.
For more information, view the full 2014 Financial Statements.