Audits of lease agreements are performed to ensure that claimed costs by the Lessor are in accordance with the terms and conditions of the lease agreement. The objectives of lease audits are:
- To verify and assess the reasonableness of the “base year costs”;
- To verify whether the amounts charged by the Lessor correspond to the amounts that were incurred and paid;
- To ensure that the funds disbursed by the Lessor have been used for their intended purposes;
- To verify that overhead costs were distributed fairly and consistently, and comparable to previous years;
- To provide advice on the interpretation of the financial clauses of the lease;
- To verify that the amounts charged by the Lessor under sub-agreements for lease improvements correspond to the amounts that were incurred and paid;
- To review common area costs such as food court, loading dock, and elevator costs allocated to the Lessee;
- To review lease escalation clauses and resulting amounts charged to the Lessee; and
- To provide litigation support related to disputes.
Welch LLP has a comprehensive knowledge of relevant Acts of Parliament, specifically the Financial Administration Act, the Federal Accountability Act, and Treasury Board policies pertaining to leasing. Our public sector clients have included PWGSC Real Property Branch and PWGSC Quebec Region.