extracted from: http://www.reco.on.ca/registrars-bulletin/brokers-of-record/
The broker of record shall ensure that the brokerage complies with this Act and the regulations.
As Subsection 12 (2) of the Act indicates the broker of record is responsible for ensuring that the brokerage complies with the Act and its regulations. In the case of sole proprietorships, the sole proprietor must also be the broker of record.
In addition to ensuring general compliance with the statute and its regulations, the Act and its regulations specify some specific functions that must be undertaken by the broker of record. Brokers of record are required to sign any brokerage financial statements sent to the Registrar under Sec. 28 of the Act. They are also required to authorize any trust account transactions under Sec. 19 and 20 of Ontario Regulation 567/05 (GEN) made under the Act.
The broker of record is also responsible for reviewing and signing monthly trust account reconciliations under Sec. 13 of Ont. Reg. 579/05 (OTH) and for reviewing and signing trade record sheets under Sec. 17 of that regulation. Sec. 30 of Ont. Reg. 567/05 (GEN) also outlines some of the general responsibilities of a broker of record. Sec. 30 states:
30.(1) A broker of record shall,
(a) actively participate in the management of the brokerage;
(b) ensure an adequate level of supervision for the brokers, salespersons and other persons employed by the brokerage; and
(c) take reasonable steps to deal with any failure to comply with the Act or the regulations by a broker, salesperson or other person employed by the brokerage.
(2) A brokerage that is not a sole proprietorship shall designate another broker employed by the brokerage who, when the broker of record is absent or unable to act, shall exercise and perform the powers and duties of the broker of record under sections 19 and 20.
(3) A brokerage that is not a sole proprietorship shall promptly inform the registrar in writing of the designation under Subsection (2) and of any change in the designation under that Subsection.
Under the Act’s regulations, corporate brokerages must also identify another broker as an alternate signing authority to review and sign off on trust and trade transactions when the broker of record is unable to act. The alternate signing authority can review and sign off on the following transactions during short periods when the broker of record is absent or unable to act:
• trust account transactions (Sec. 19 and 20 of Ont. Reg. 567/05 (GEN));
• monthly trust account reconciliations (Sec. 13 of Ont. Reg. 579/05 (OTH)); and
• trade record sheets (Sec. 17 of Ont. Reg. 579/05 (OTH));
The designated broker of record, however, remains responsible for other duties and functions under the Act.
Having a designated broker of record is a requirement of registration under the Act. No application for registration as a brokerage will be approved by the Registrar without a designated broker of record.
Corporations that designate a broker of record must do so through passage of a corporate resolution made by the board of directors and signed by the officers with the appropriate signing authority. A copy of this resolution must be submitted to the Registrar as part of the application or designation process.
Corporate brokerages must also inform the registrar in writing of the identity of the alternate signing authority (who can sign trust and trade transactions) and notify, the Registrar, in writing, of any changes to this designation. (Corporations can designate this signing authority internally, i.e., a corporate resolution is not
required for this designation.)
Please note that a corporation can only have one designated broker of record at any one time. In cases where a broker of record is going to be absent for a significant period of time and cannot fulfill his or her responsibilities under the Act and regulations, brokerages must designate another broker to act as the broker of record. This designation should be done through a corporate resolution. As per Sec. 12(1)(b) of the Act, brokerages must notify the Registrar of any changes to the designated broker of record within 5 days of the change.