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What is a Notice of Deficiency?
A Notice of Deficiency (NOD) will indicate items where the AFS report was found to be deficient and/or will identify items that require further clarification. The NOD will be sent to the authorized contact person(s) identified by the licensee for the AFS report. Some deficiencies may need to be addressed on the AFS report by the Certified Public Accountant (CPA). If the CPA makes corrections/modifications to the report, the date of the report should reflect the date of the newly issued report. If the CPA prefers to keep the original issued date on the report, they can do so but should also include the date that the corrections/modifications were made. Other deficiencies may require an explanation or documentation from the licensee. The authorized contact person(s) must coordinate with the licensee and CPA to resolve deficiencies in a timely manner.
Additional questions may arise, or further explanations or documentation may be needed to clarify NOD responses, which will result in subsequent NODs. The CRA will continue to work with the licensee until all deficiencies are resolved, so long as the licensee is responding timely. Failure to correct an AFS deficiency within 10 business days of notification by the CRA may result in disciplinary action. If additional time is required to correct a deficiency, the licensee may request an extension in writing by contacting their analyst.
Deficiencies are not disciplinary in nature, and the number of deficiencies should not be taken as an indication that the CPA or the licensee has necessarily done something wrong.