Bill C-2

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	General
No constructive notice	23. No person dealing with the Board or with any person who has acquired rights from the Board is deemed to have notice or knowledge of the contents of a document, other than an Act of Parliament or any instrument required to be published in the Canada Gazette pursuant to the Statutory Instruments Act, concerning the Board by reason only that the document is available at the head office of the Board or has been made public.
Validity of acts	24. An act of the Chairperson or other director of the Board, or of the chief executive officer or other officer of the Board, is not invalid by reason only of an irregularity in that person's appointment or a defect in that person's qualifications.
Assertions	25. The Board may not assert against a person dealing with the Board or with any person who has acquired rights from the Board
	(a) that this Act or the by-laws have not been complied with, or
	(b) that a document issued by any director, officer or agent of the Board having appar ent authority to issue the document is not valid or genuine by reason only that the person who issued the document lacked actual authority to issue the document,
	except where the person has knowledge that the facts asserted are true.
Corporate seal	26. The Board may, but need not, have a corporate seal, and an instrument or agree ment executed on behalf of the Board is not invalid merely because a corporate seal is not affixed to it.
	BY-LAWS
By-laws	27. (1) The board of directors may make by-laws that are consistent with this Act to govern the conduct and management of the Board's business and affairs, including by- laws
	(a) for the administration, management and control of the Board's property;
	(b) governing the calling of meetings of the board of directors and its committees, the time and place of those meetings and the quorum and procedure in all matters relat ing to those meetings;
	(c) respecting the functions, duties and remuneration of the officers and employees of the Board; and
	(d) respecting the establishment of commit tees of the board of directors and the appointment of members to those commit tees.
Effective date	(2) A by-law is effective as soon as it is made or on such later date as may be stated in the by-law to be its effective date.
Copy to Minister	28. (1) The board of directors shall provide a copy of every by-law and every amendment to or repeal of any by-law to the Minister and the appropriate provincial Ministers within 14 days after its effective date.
By-laws available to the public	(2) A copy of every by-law shall be kept at the head office of the Board. Anyone is entitled, during the usual business hours of the Board, to examine the by-laws and, on payment of a reasonable fee, to make copies of or take extracts from them.
Statutory Instruments Act does not apply	29. The Statutory Instruments Act does not apply in respect of by-laws.
	COMMITTEES
	Establishment
Audit and investment committees	30. (1) The board of directors shall establish an audit committee and an investment com mittee.
Other committees	(2) The board of directors may establish other committees as it deems necessary and assign to them such duties as it considers appropriate.
	Audit Committee
Duties of audit committee	31. The audit committee shall
	(a) require the Board's management to implement and maintain appropriate inter nal control procedures;
	(b) review, evaluate and approve those internal control procedures;
	(c) review and approve the Board's annual financial statements and report to the board of directors before those statements are approved by the board of directors;
	(d) meet with the Board's auditor to discuss the Board's annual financial statements and the auditor's report;
	(e) review all investments and transactions that could adversely affect the return on the Board's investments that are brought to the committee's attention by the Board's audi tor or officers; and
	(f) meet with the chief internal auditor of the Board, or with the person acting in any similar capacity, and with the Board's management, to discuss the effectiveness of the internal control procedures.
Meeting of audit committee	32. (1) The Board's auditor or any member of the audit committee may call a meeting of the committee.
Meeting of directors	(2) The audit committee may call a meeting of the board of directors to consider any matter of concern to the committee.
Auditor's right to attend meetings	33. (1) The Board's auditor is entitled to receive notice of and to attend meetings of the board of directors and meetings of the audit committee, at the Board's expense, and to be heard at those meeting on matters relating to the auditor's duties.
Requiring auditor's attendance	(2) The Board's auditor shall attend meet ings of the audit committee, if requested to do so by a member of the audit committee, at the Board's expense, and shall attend meetings of the board of directors, if requested to do so by a director.
	Investment Committee
Duties of investment committee	34. The investment committee shall
	(a) perform the duties that are delegated to it by the board of directors;
	(b) approve the engagement of investment managers empowered with discretionary authority to invest the assets of the Board;
	(c) meet with the officers and employees of the Board to discuss the effectiveness of the Board's investment policies and the achievement of the Board's objects;
	(d) require management to implement and maintain appropriate procedures to
	(i) monitor the application of the Board's investment policies, standards and proce dures, and
	(ii) ensure that the Board's agents comply with this Act and the Board's investment policies, standards and procedures; and
	(e) review, evaluate and approve manage ment's procedures referred to in paragraph (d).
	INVESTMENTS
Investment policies, standards and procedures	35. Subject to the regulations, the board of directors shall establish, and the Board and its subsidiaries shall adhere to, investment poli cies, standards and procedures that a person of ordinary prudence would exercise in dealing with the property of others.
Duty of investment managers	36. Every investment manager who invests the assets of the Board shall do so in accor dance with this Act and the Board's invest ment policies, standards and procedures.
Income Tax Act	37. The Board and its subsidiaries shall invest their assets in such a way that tax would not be payable by them under subsection 206(2) of the Income Tax Act if Part XI of that Act applied to them.
	FINANCIAL MANAGEMENT
	Financial Year
Financial year	38. The financial year of the Board is the period beginning on April 1 in one calendar year and ending on March 31 in the next calendar year.
	Financial Statements
Books and systems	39. (1) The Board shall, in respect of itself and each of its subsidiaries, cause
	(a) books of account and records to be kept;
	(b) financial and management control and information systems and management prac tices to be maintained; and
	(c) a record of the investments held during the financial year to be kept, showing
	(i) the book value of each investment,
	(ii) the market value of each investment and such information as will permit the verification of that value, and
	(iii) such information as will permit the determination of whether the require ments of this Act and the investment policies, standards and procedures have been met.
Manner in which books, etc., to be kept	(2) The books, records, systems and practic es required by subsection (1) shall be kept and maintained in such manner as will provide reasonable assurance that
	(a) the Board's assets and those of its subsidiaries are safeguarded and con trolled;
	(b) the Board's transactions and those of its subsidiaries are in accordance with this Act and the by-laws, or the by-laws of the subsidiaries, as the case may be; and
	(c) the Board's financial, human and physi cal resources and those of its subsidiaries are managed economically and efficiently and that the Board's operations and those of its subsidiaries are carried out effectively.
Internal audit	(3) The Board shall cause internal audits to be conducted, in respect of itself and each of its subsidiaries, to assess compliance with subsections (1) and (2).
Annual financial statements	(4) The Board shall cause financial state ments to be prepared annually, in respect of itself and each of its subsidiaries, including, with respect to the financial year to which it relates,
	(a) a balance sheet as at the end of the financial year;
	(b) a statement of income for the financial year;
	(c) a statement of change in net assets for the financial year; and
	(d) a statement of investment portfolio.
Contents of statements	(5) The annual financial statements shall show such information and particulars as in the opinion of the directors are necessary to present fairly, in accordance with generally accepted accounting principles, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants, the Board's financial position as at the end of the financial year to which it relates.
Quarterly financial statements	(6) During each financial year, the Board shall cause quarterly financial statements to be prepared for each three month period of the year. The quarterly statements shall
	(a) show the same information for the most recent three month period as is required to be set out in the Board's annual financial statements, except that a balance sheet is not required; and
	(b) show the same information in respect of the part of the year up to the date of the statements in relation to the corresponding period in the preceding financial year.
Approval by board of directors	(7) The board of directors shall approve the annual financial statements of the Board and of each of its subsidiaries and that approval shall be evidenced by the signature of at least one director of the Board.
	Auditor's Report
Annual auditor's report	40. (1) The Board shall cause an annual auditor's report to be prepared, in respect of itself and each of its subsidiaries, on
	(a) the annual financial statements referred to in section 39;
	(b) any revised financial statement referred to in subsection 41(3); and
	(c) the record of investments referred to in paragraph 39(1)(c).
Contents	(2) A report under subsection (1) shall be addressed to the Board and shall
	(a) include separate statements indicating whether, in the auditor's opinion,
	(i) the financial statements are presented fairly in accordance with generally ac cepted accounting principles applied on a basis consistent with that of the preced ing year,
	(ii) the Board's transactions and those of its subsidiaries that have come to the auditor's notice in the course of the auditor's examination for the report were in accordance with this Act and the by-laws, and the by-laws of the subsid iaries, as the case may be, and
	(iii) the record of investments kept in accordance with paragraph 39(1)(c) fair ly presents the information required by that paragraph; and
	(b) call attention to any other matter falling within the scope of the auditor's examina tion for the report that, in the auditor's opinion, should be brought to the attention of the Board.
Examination	(3) An auditor preparing a report under subsection (1) shall make such examination as the auditor considers necessary for the pur pose.
Auditing standards	(4) An auditor's examination shall be conducted in accordance with generally ac cepted auditing standards, the primary source of which is the Handbook of the Canadian Institute of Chartered Accountants.
Reliance on internal audit	(5) In conducting an audit under this Act, an auditor shall rely on any internal audit con ducted under subsection 39(3), to the extent that the auditor considers that reliance to be practicable.
Notice of errors and omissions	41. (1) A director or officer of the Board shall without delay notify the Board's auditor and the audit committee of any error or omission of which the director or officer becomes aware in a financial statement that the auditor or a former auditor has reported on or in a report prepared by the auditor or a former auditor under section 40.
Duty of auditor	(2) Where the Board's auditor, or a former auditor of the Board, is notified or becomes aware of any error or omission in a financial statement that the auditor or former auditor has reported on or in a report prepared by the auditor or former auditor under section 40, the auditor or former auditor shall without delay notify each director of the Board of the error or omission if the auditor or former auditor is of the opinion that the error or omission is material.
Correction	(3) Where the directors receive a notifica tion under subsection (2) of an error or omission in a financial statement or a report, the Board shall prepare a revised financial statement or the auditor or former auditor shall issue a correction to the report, as the case may be, and a copy of it shall be given to the Minister and the appropriate provincial Minis ters.