Laurentian University governors approve 2020-21 financials after Zoom bombing

Laurentian University's board of governors has approved the Sudbury, Ont., school's draft consolidated financial statements for 2020-21, despite disrupters staging a Zoom bombing near the start of the presentation.

The special meeting Monday allowed governors to ask questions and vote on the statements, which arrived far later than the expected deadline of Oct. 31, 2021. The report has faced delays as the university navigates insolvency under the Companies Creditors' Arrangement Act (CCAA).

The report showed Laurentian ended its 2020-21 fiscal year (ending April 30, 2021, two months after it declared insolvency) with a deficit of $65.9 million, compared to a $3.4-million deficit in the 2019-20 fiscal year. 

However, 2020-21 included $79.1 million in restructuring expenses. Without counting restructuring costs, the school would have posted a $13.2-million surplus.

"In the coming months, it'll be incumbent on all of us to look at the lessons learned and the advice provided, and decide which of those items we implement," said board chair Jeff Bangs.

The board voted to approve the statements.

Auditing firm KPMG prepared the report. Board members Tom Fenske and Fabrice Colin both raised concerns that the Sudbury KMPG branch worked on the audit, saying the board had been assured that only the firm's Ottawa office would be taking on the report. 

Board members said there had been a loss in confidence in the local branch and had hoped the firm's top financial experts would take on the file. KPMG has prepared the school's annual financial statements for the past decade. At least one observer has said the firm should answer questions about its reviews of the school's books.

Michel Piche, the school's interim vice-president of finance and administration, said the Ottawa office had overseen the audit, but the local branch conducted the field work.

Board members received clarity that all severances, including those taking effect after the end of the 2020-21 fiscal year, were included in the restructuring cost figure.

Piche said the high figure of $24.7 million for cancelled interest-rate swaps was because the long-term debt had to be converted to higher fixed-rate loans, due to its variable rate products being considered in default when insolvency proceedings began.

Board member Dan Scott said he understood the finance committee had not yet reviewed a budget for the current 2021-22 fiscal year, which ends April 30. He asked Piche whether the committee would receive an operating budget for review before the fiscal year ended.

PIche said the plan was to share a budget for the upcoming 2022-23 fiscal year with the finance committee before the end of April, adding the committee would not be seeing a budget for the ongoing fiscal year.

A small number of attendees delayed the start of the financial discussion by playing "rude comments," displaying graphic imagery and preventing others from speaking due to the ruckus. This has become more common since the start of the pandemic and the prevalence of video meetings, and is called Zoom bombing.