The appellant appealed a CRA decision to revoke its registration, which was made on grounds which focused on the substantial amounts paid for what appeared to be personal expenditures of an officer and director ("O'Sullivan") (with CRA alleging that at least approximately $69,000 of improper reimbursements, whereas the appellant admitted (para. 14) "that approximately $22,000 of Mr. O'Sullivan's personal expenses had been ‘inadvertently' reimbursed by the Appellant and asserted that… comic books had been purchased by the Appellant as ‘investment assets'"), and substantial deficiencies in its books and records.
In finding that the Appeals Directorate's decision to confirm the decision was reasonable, Ryer JA:
- it was within a range of justifiable outcomes for the Appeals Directorate to conclude that the provision of personal benefits to Mr. O'Sullivan, of even the lower amount recognized by the Appellant, constituted serious non-compliance…[and] the record shows a considerable number of instances in which Mr. O'Sullivan received personal benefits (paras. 68-69)
- "the obligation of a charitable organization to maintain adequate books and records is foundational" (para. 80) whereas here the Appellant admitted "it could only directly link its expenditures to 12 of its 42 programs" (para. 76) and there was an "intermingling of Mr. O'Sullivan's personal expenses with the Appellant's expenses in the accounting records" (para. 77)
See summaries under s. 172(3)(a.1) and s. 189(7).