Canadian audit watchdog censures another Mississauga accounting firm

TORONTO, September 21, 2025 – After 26 “violation events” were uncovered during an investigation by the Canadian Public Accountability Board, Abu-Farah Professional Corporation of Mississauga, Ontario has been prohibited from accepting all new reporting issuer audit engagements. The recently published enforcement action imposed requirements, a restriction and sanction on the firm, taking effect on July 17, 2025. 

Abu-Farah Professional Corporation is the second firm to publicly censured this year. As reported by Canadian Accountant, CPAB censured Clearhouse LLP, another Mississauga firm, earlier this year. 

The Canadian audit watchdog also modified restrictions against three previously censured accounting firms: Smythe LLP, which is based in Vancouver; Dale Matheson Carr-Hilton LaBonte LLP, which has four offices in British Columbia; and PKF Antares Professional Corporation, Chartered Professional Accountants, which is based in Calgary, Alberta. 

In early 2023, CPAB began publishing on its website the names of firms that are subject to significant enforcement actions, imposed as a consequence of an inspection. The public can access documentation identifying all firms currently under some type of restriction on the type of audits it may conduct. 

As reported by Canadian Accountant, after years of industry consultation, government relations and media coverage, CPAB will publish individual, “firm-specific” public inspection reports, commencing with 2025 inspections, with publication beginning in the first quarter of 2026. As the Globe and Mail succinctly stated: “The country’s top audit regulator is going to start naming names.” 

CPAB enforcement actions, CPA Ontario professional conduct committee allegations

According to the enforcement action, CPAB reviewed the work papers for two of the firm’s audits and discovered multiple significant violations, including “a significant number of audit working papers that were finalized, signed off or added to the audit file after the audit report date.” 

Further, the firm did not complete appropriate substantive procedures to test multiple financial statement line items, and did not comply with professional standards pertaining to the auditor’s responsibility related to fraud in an audit of financial statements. 

“The Firm did not perform audit procedures over the fair value of consideration paid related to an acquisition or the existence, accuracy, completeness and valuation of assets acquired and key assumptions in management’s forecast were not tested. 

“Bank confirmations were either not obtained for material cash balances as at the balance sheet date or the engagement team did not maintain control of the confirmation process. The Firm did not consider whether substantive procedures alone provide sufficient appropriate audit evidence to support the audit opinion.” 

In July 2025, CPA Ontario published professional conduct committee allegations against Fathi Abu-Farah, CPA, CA, with a hearing date yet to be determined. The notice details allegations involving the audits of seven unnamed companies, for fiscal years ending in 2023 and 2024, including “reclassification of certain balances and transactions [that] were included in the financial statements” and a failure to sufficiently perform and/or document substantive audit procedures. 

One fintech company affected identified by multiple sources

Neither CPAB nor CPA Ontario notices identify the names of specific companies. However, both the TMX and TipRanks, a Canadian “auto generated newsdesk,” reported on a statement issued on August 29, 2025 by a company called XTM Inc., which is headquartered in Toronto. The company, which operates as AnyDay, specializes in fintech services like automated tip pooling and instant payouts. 

According to the TMX Group, “As part of its commitment to full transparency and regulatory compliance, the Company filed a press release on August 29, 2025 (the “August 29 Release”), posted to SEDAR+ Read Press Release Here. The August 29 Release directed attention to a publicly available CPAB enforcement notice issued August 8, 2025, in relation to the Company’s auditor, Abu-Farah Professional Corporation.” 

Colin Ellis is a contributing editor to Canadian Accountant.