A private Canadian corporation can avoid an audit only if its shareholders waive the auditor, and only for one year at a time. In Alberta that takes a special resolution of a corporation that is not a reporting issuer. Federally it takes the consent of every shareholder, voting or not, of a non-distributing corporation.
| Alberta (ABCA s. 163) | Federal (CBCA s. 163) | |
|---|---|---|
| Who can use it | A corporation other than a reporting issuer | A corporation that is not a distributing corporation |
| Approval needed | Special resolution: at least 2/3 of votes cast, or signed by all shareholders entitled to vote | Consent of all shareholders, including those not otherwise entitled to vote |
| How long it lasts | Until the following annual meeting | Until the next succeeding annual meeting |
| Statements still required? | Yes, at every annual meeting (s. 155) | Yes |
Why it has to be renewed every year
Both Acts make the resolution valid only until the next annual meeting. A corporation that waived its auditor once and has not renewed the resolution since is, on paper, required to have an auditor. In practice the waiver is usually passed as part of the annual resolutions your lawyer or accountant prepares. Check that it was, especially after a change of shareholders.
Under the federal Act, a single non-voting shareholder who will not consent prevents the waiver. Family corporations with non-voting shares held by adult children or a trust should plan for that.
The 2022 Alberta change
Alberta’s rule now requires a special resolution of the shareholders of a corporation other than a reporting issuer. The section was amended in 2021 (SA 2021 c 18), and the amendment came into force in 2022. If you rely on older advice that Alberta, like the CBCA, needed unanimous consent, check it against the current Act.
The waiver does not override your contracts
Shareholders can waive an auditor. They cannot waive your lender’s covenant, your bonding company’s requirement or a franchisor’s. If any of those asks for audited statements, you need an audit regardless.
Questions people ask
Can a small Alberta corporation skip the audit?
Yes, if it is not a reporting issuer. Its shareholders may resolve by special resolution not to appoint an auditor (Business Corporations Act, s. 163(1)). A special resolution needs at least two-thirds of the votes cast, or the signatures of all shareholders entitled to vote. The resolution is valid only until the next annual meeting of shareholders (s. 163(2)).
Can a federally incorporated (CBCA) corporation skip the audit?
Yes, if it is not a distributing corporation and all shareholders consent, including shareholders not otherwise entitled to vote (Canada Business Corporations Act, s. 163). The resolution is valid only until the next annual meeting.
If we waive the auditor, do we still need financial statements?
Yes. Waiving the auditor removes the audit, not the statements. In Alberta the directors must still place financial statements before the shareholders at every annual meeting, with “the report of the auditor, if any” (s. 155). Those statements are usually compiled or reviewed.
Sources
- Alberta King’s Printer, Business Corporations Act, RSA 2000, c B-9 — current as of 2 September 2026; s. 1 (special resolution), s. 163. Read 25 October 2026.
- Justice Laws Website, Canada Business Corporations Act, s. 163. Read 25 October 2026.