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205 ILCS 635/3-2
(205 ILCS 635/3-2)
(from Ch. 17, par. 2323-2)
(a) At the licensee's fiscal year-end, but in no
case more than 12 months after the last audit conducted pursuant to this
Section, except as otherwise provided in this Section, it shall be
mandatory for each residential mortgage licensee to
cause its books and accounts to be audited by a certified public accountant
not connected with such licensee. The books and records of all licensees
under this Act shall be maintained on an accrual basis. The audit must be
sufficiently comprehensive in scope to permit
the expression of an opinion on the financial statements, which must be
prepared in accordance with generally accepted accounting principles, and
must be performed in accordance with generally accepted auditing standards. Notwithstanding
the requirements of this subsection, a licensee that is a first tier subsidiary
may submit audited consolidated financial statements of its parent as long as
the consolidated statements are supported by consolidating statements. The
licensee's chief financial officer shall attest to the licensee's financial
statements disclosed in the consolidating statements.
(b) As used herein, the term "expression of opinion" includes either
(1) an unqualified opinion, (2) a qualified opinion, (3) a disclaimer of
opinion, or (4) an adverse opinion.
(c) If a qualified or adverse opinion is expressed or if an opinion is
disclaimed, the reasons therefore must be fully explained. An opinion,
qualified as to a scope limitation, shall not be acceptable.
(d) The most recent audit report shall be filed with the
Commissioner within 90 days after the end of the licensee's fiscal year, or with the Nationwide Mortgage Licensing System and Registry, if applicable, pursuant to Mortgage Call Report requirements. The report
filed with the Commissioner shall be certified by the certified public
accountant conducting the audit. The Commissioner may promulgate rules
regarding late audit reports.
(e) If any licensee required to make an audit shall fail to cause an
audit to be made, the Commissioner shall cause the same to be made by a
certified public accountant at the licensee's expense. The Commissioner
shall select such certified public accountant by advertising for bids or
by such other fair and impartial means as he or she establishes by regulation.
(f) In lieu of the audit or compilation financial statement
required by this Section, a licensee shall submit and the Commissioner may
accept any audit made in conformance with the audit
requirements of the U.S. Department of Housing and Urban Development.
(g) With respect to licensees who solely broker residential mortgage
loans as defined in subsection (o) of Section 1-4, instead of the audit
required by this Section, the Commissioner may
compilation financial statements prepared at least every 12 months, and
the compilation financial statement must be submitted within 90 days after the end of
the licensee's fiscal year, or with the Nationwide Mortgage Licensing System and Registry, if applicable, pursuant to Mortgage Call Report requirements. If a
under this Section fails to file a compilation as required, the Commissioner
shall cause an audit of the licensee's books and accounts to be made by a
certified public accountant at the licensee's expense. The Commissioner shall
select the certified public accountant by advertising for bids or by such other
fair and impartial means as he or she establishes by rule. A licensee who
files false or misleading compilation financial statements is guilty of a
business offense and shall be fined not less than $5,000.
(h) The workpapers of the certified public accountants employed
licensee for purposes of this Section are to be made available to the
Commissioner or the Commissioner's designee upon request and may be
reproduced by the Commissioner or the Commissioner's designee to enable to
the Commissioner to carry out the purposes of this Act.
(i) Notwithstanding any other provision of this Section, if a licensee
relying on subsection (g) of this Section causes its books to be audited at any
other time or causes its financial statements to be reviewed, a complete copy
of the audited or reviewed financial statements shall be delivered to the
Commissioner at the time of the annual license renewal payment following
receipt by the licensee of the audited or reviewed financial statements. All workpapers shall be made available to the
Commissioner upon request. The financial statements and workpapers may be
reproduced by the Commissioner or the Commissioner's designee to carry out the
purposes of this Act.
(Source: P.A. 97-813, eff. 7-13-12; 97-891, eff. 8-3-12; 98-463, eff. 8-16-13.)