The Financial Advisors Association of Canada Notes to Summary Consolidated Financial Statements

(in thousands of dollars)

December 31, 2022

2. Capital Management (continued)

The financial results of 2022 have put a strain on the financial resources and liquidity of TFAAC. Subsequent to year end, management has taken the following steps to improve the cash position of the organization and to reduce operating costs to ensure financial stability:

• arranged a loan of $610,000 against the cash surrender value of the life insurance policies held;

• increased their line of credit to $500,000;

• received support from the Century Initiative Fund including a line of credit totaling $1,700,000; and

• is in the process of completing a restructuring plan with a view to significantly reduce operating expenses and provide a sound financial base for the organization moving forward.

Based on the above, Management is of the opinion that TFAAC has taken the appropriate steps to ensure its financial stability and sustainability.