The Law Society’s 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 (“LᴀᴡPRO”) and LibraryCo Inc. (“LibraryCo”).
The annual financial statements were approved by Convocation on April 26, 2018, and show the Society’s General Fund continues to maintain a strong financial position.
Summary of Financial Performance
The Society’s lawyer and paralegal General Funds, which account for the Society’s program delivery and administrative activities, are reporting a combined operating deficit of $860,000 (2016 - $3.8 million surplus). The 2017 budget incorporated $4.8 million of the lawyer General Fund Balance to mitigate fee increases and also incorporated $600,000 in funding from surplus investment income in the Errors & Omissions Insurance Fund. The 2017 budget also projected a deficit in the Paralegal General Fund of $1 million with the use of the accumulated balance, so operating results are better than budgeted.
All the major revenue and expense categories were better than budget with the exception of reorganization related costs and, as budgeted, typically increased from the prior year. In comparing 2017 results to 2016 results, apart from departmental reorganizations, the size and nature of operations were substantially similar.
The Society’s restricted funds are reporting a combined deficit of $7.9 million in 2017 (2016 - $2.7 million deficit). The primary factors in the performance of the restricted funds are:
The Lawyer Compensation Fund experienced an adverse claims experience, resulting in a deficit of $9.5 million (2016 - $2.1 million deficit)
The Errors & Omissions Insurance Fund is reporting a surplus of $732,000 (2016 - $1.2 million)
The Capital Allocation Fund experienced a surplus of $3.4 million (2016 – $1.4 million) dependent on the capitalization of projects during the year
Amortization in the Invested in Capital and Intangible Assets Fund of $2.4 million (2016 - $3.1 million) was a contributor to the restricted funds deficit in the current year.