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INDEPENDENT AUDITOR’S REPORT
To the Shareholders and the Board of Directors of The Toronto-Dominion Bank
Opinion
We have audited the consolidated financial statements
 
of The Toronto-Dominion Bank and its subsidiaries (TD), which comprise
 
the Consolidated Balance Sheets
as at October 31, 2025
 
and 2024, and the Consolidated Statements
 
of Income, Consolidated Statements
 
of Comprehensive Income, Consolidated
 
Statements
 
of
Changes in Equity, and Consolidated Statements
 
of Cash Flows for the years then ended, and
 
notes to the consolidated financial statements,
 
including a summary
of material accounting policies (collectively
 
referred to as the “consolidated financial
 
statements”).
In our opinion, the accompanying consolidated
 
financial statements present fairly, in all material respects, the
 
consolidated financial position of TD as at October
31, 2025 and 2024, and its consolidated financial
 
performance and its consolidated cash
 
flows for the years then ended, in accordance
 
with International Financial
Reporting Standards (IFRS) as issued by
 
the International Accounting Standards Board.
Basis for Opinion
We conducted our audit in accordance with Canadian
 
generally accepted auditing standards. Our
 
responsibilities under those standards are further
 
described in
the
Auditor’s Responsibilities for the Audit of the
 
Consolidated Financial Statements
section of our report. We are independent of
 
TD in accordance with the ethical
requirements that are relevant to our audit
 
of the consolidated financial statements
 
in Canada, and we have fulfilled our other
 
ethical responsibilities in accordance
with these requirements. We believe that
 
the audit evidence we have obtained is sufficient and
 
appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters
 
that, in our professional judgment, were
 
of most significance in our audit of the consolidated
 
financial statements of the year
ended October 31, 2025. These matters
 
were addressed in the context of our audit of
 
the consolidated financial statements as
 
a whole, and in forming our opinion
thereon, and we do not provide a separate
 
opinion on these matters. For each matter below, our description
 
of how our audit addressed the matter is provided
 
in
that context.
 
We have fulfilled the responsibilities described in
 
the
Auditor’s Responsibilities for the Audit
 
of the Consolidated Financial Statements
section of our report,
including in relation to these matters. Accordingly, our audit included
 
the performance of procedures designed to respond
 
to our assessment of the risks of material
misstatement of the consolidated financial
 
statements. The results of our audit procedures,
 
including the procedures performed
 
to address the matters below,
provide the basis for our audit opinion on
 
the accompanying consolidated financial
 
statements.
Allowance for credit losses
Key audit matter
TD describes its significant accounting judgments,
 
estimates, and assumptions in relation
 
to the allowance for credit losses in Note
3 of the consolidated financial statements.
 
As disclosed in Note 8 to the consolidated
 
financial statements, TD recognized $9,745
million in allowances for credit losses on its
 
consolidated balance sheet using an
 
expected credit loss model (ECL). The ECL
 
is an
unbiased and probability-weighted estimate of
 
credit losses expected to occur in the future,
 
which is based on the probability of
default (PD), loss given default (LGD) and exposure
 
at default (EAD) or the expected
 
cash shortfall relating to the underlying
financial asset. The ECL is determined by evaluating
 
a range of possible outcomes incorporating
 
the time value of money and
reasonable and supportable information about
 
past events, current conditions, and future
 
economic forecasts. ECL allowances are
measured at amounts equal to either (i) 12-month
 
ECL; or (ii) lifetime ECL for those financial
 
instruments that have experienced a
significant increase in credit risk (SICR) since
 
initial recognition or when there is
 
objective evidence of impairment.
Auditing the allowance for credit losses was
 
complex and required the application of
 
significant judgment and involvement of
specialists because of the sophistication of
 
the models, the forward-looking nature
 
of the key assumptions, and the inherent
interrelationship of the critical variables used
 
in measuring the ECL. Key areas of judgment
 
include evaluating: (i) the models and
methodologies used for measuring both the
 
12-month and lifetime expected credit losses;
 
(ii) the assumptions used in the ECL
scenarios including forward-looking information
 
(FLI) and assigning probability weighting;
 
(iii) the determination of SICR; and (iv)
 
the
assessment of the qualitative component applied
 
to the modelled ECL based on management’s
 
expert credit judgment.
 
How our audit
addressed the
 
key audit matter
We obtained an understanding, evaluated the design,
 
and tested the operating effectiveness of
 
management’s controls over the
allowance for credit losses. The controls
 
we tested included, amongst others, the development
 
and validation of models and
selection of appropriate inputs including economic
 
forecasting,
 
determination of non-retail borrower
 
risk ratings, the integrity of the
data used including the associated controls over
 
relevant information technology (IT) systems,
 
and the governance and oversight
over the modelled results and the use of expert
 
credit judgment.
To test the allowance for credit losses, our audit procedures included, amongst
 
others, involving our credit risk specialists
 
to assess
whether the methodology and assumptions,
 
including management’s SICR triggers, used in
 
significant models that estimate the
ECL across various portfolios are consistent
 
with the requirements of IFRS.
 
This included reperforming the model
 
validation
procedures for a sample of models to evaluate
 
whether management’s conclusions were appropriate.
 
With the assistance of our
economic specialists, we evaluated the
 
models, methodology and process used by
 
management to develop the FLI variable
forecasts for each scenario and the scenario
 
probability weights. For a sample of FLI
 
variables, we compared management’s FLI to
independently derived forecasts and publicly available
 
information. On a sample basis,
 
we recalculated the ECL to test the
mathematical accuracy of management’s
 
models. We tested the completeness and accuracy
 
of data used in measuring the ECL by
agreeing to source documents and systems
 
and evaluated a sample of management’s non-retail
 
borrower risk ratings against TD’s
risk rating policy. With the assistance of our credit risk specialists,
 
we also evaluated management’s methodology
 
and governance
over the application of expert credit judgment
 
by evaluating that the amounts recorded
 
were reflective of underlying credit quality
and macroeconomic trends. We also assessed
 
the adequacy of disclosures related to the
 
allowance for credit losses.
Fair value measurement of derivatives
Key audit matter
TD describes its significant accounting judgments,
 
estimates, and assumptions in relation
 
to the fair value measurement of
derivatives in Note 3 of the consolidated financial
 
statements. As disclosed in Note 5 of the consolidated
 
financial statements, TD
has derivative assets of $82,972 million and
 
derivative liabilities of $79,356 million recorded
 
at fair value. Certain of these
derivatives are complex and illiquid and require
 
valuation techniques that may include complex
 
models and non-observable inputs,
requiring management’s estimation and judgment.
Auditing the valuation of certain derivatives required
 
the application of significant auditor judgment
 
and involvement of valuation
specialists in assessing the complex
 
models and non-observable inputs used. Certain
 
valuation inputs used to determine fair
 
value
that may be non-observable include volatilities,
 
correlations, and credit spreads. The
 
valuation of certain derivatives is sensitive
 
to
these inputs as they are forward-looking and
 
could be affected by future economic and market
 
conditions.
 
How our audit
addressed the
 
key audit matter
We obtained an understanding, evaluated the design,
 
and tested the operating effectiveness of
 
management’s controls, including
the associated controls over relevant IT systems,
 
over the valuation of TD’s derivative portfolio.
 
The controls we tested included,
amongst others, the controls over the suitability
 
and mechanical accuracy of models used in
 
the valuation of derivatives, and
controls over management’s independent assessment
 
of fair values, including the integrity of data
 
used in the valuation such as the
significant inputs noted above.
 
To test the valuation of these derivatives, our audit procedures included,
 
amongst others, an evaluation of the
 
methodologies and
significant inputs used by TD. With the assistance
 
of our valuation specialists, we performed
 
an independent valuation for a sample
of derivatives to assess the modelling assumptions
 
and significant inputs used to estimate
 
the fair value, which involved obtaining
significant inputs from independent external
 
sources,
 
where available. We also assessed the adequacy
 
of the disclosures related to
the fair value measurement of derivatives.
Measurement of provision for uncertain
 
tax positions
Key audit matter
TD describes its significant accounting judgments,
 
estimates, and assumptions in relation
 
to income taxes in Note 3 and Note 23 of
the consolidated financial statements. As a
 
financial institution operating in multiple jurisdictions,
 
TD is subject to complex and
constantly evolving tax legislation. Uncertainty
 
in a tax position may arise as tax laws are
 
subject to interpretation. TD uses
significant judgment in i) determining whether
 
it is probable that TD will have to make
 
a payment to tax authorities upon their
examination of certain uncertain tax positions
 
and ii) measuring the amount of
 
the provision.
 
Auditing TD’s provision for uncertain tax positions
 
involved
 
the application of judgment and is based on
 
interpretation of tax
legislation and jurisprudence.
How our audit
addressed the
 
key audit matter
We obtained an understanding, evaluated the design,
 
and tested the operating effectiveness of
 
management’s controls over TD’s
provision for uncertain tax positions.
 
The controls we tested included, amongst others,
 
the controls over the assessment of the
technical merits of tax positions and management’s
 
process to measure the provision for
 
uncertain tax positions.
With the assistance of our tax professionals,
 
we assessed the technical merits and the
 
amount recorded for uncertain tax positions.
Our audit procedures included, amongst others,
 
using our knowledge of, and experience
 
with, the application of tax laws by the
relevant income tax authorities to evaluate
 
TD’s interpretations and assessment of tax laws
 
with respect to uncertain tax positions.
We assessed the implications of correspondence
 
received by TD from the relevant
 
tax authorities and evaluated income tax
opinions or other third-party advice obtained.
 
We also assessed the adequacy of the disclosures
 
related to uncertain tax positions.
 
Valuation of Goodwill in the U.S. Personal and
 
Commercial Banking group of Cash Generating
 
Units
Key audit matter
TD describes its significant accounting judgments,
 
estimates, and assumptions in relation
 
to the recoverable amount of its cash
generating units (‘CGU”) or group of
 
CGUs to which goodwill has been allocated
 
in Note 3 of the consolidated financial
 
statements.
As disclosed in Note 13 of the consolidated
 
financial statements, TD has $14,776 million of
 
goodwill in the U.S. Retail segment,
which predominantly relates to the U.S. Personal
 
and Commercial Banking group of
 
cash generating units (“US P&C CGUs”).
Goodwill is assessed for impairment annually, or more frequently
 
if impairment indicators are present.
 
Auditing the recoverable amount for the
 
U.S. P&C CGUs was complex and required
 
the application of significant auditor judgment
and involvement of valuation specialists in
 
assessing certain significant assumptions
 
in the impairment test. Significant assumptions
in the estimate of the recoverable amount included
 
the discount rate and certain forward-looking
 
assumptions, such as the terminal
growth rate, and forecasted earnings,
 
which are affected by expectations about future
 
market or economic conditions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
How our audit
addressed the
 
key audit matter
We obtained an understanding, evaluated the design,
 
and tested the operating effectiveness of
 
management’s controls over the
recoverable amount of TD’s U.S. P&C CGUs.
 
The controls we tested included, amongst
 
others, the controls over management’s
review of TD’s forecast
 
as well as controls over management’s review
 
of the model and methodology over significant
 
assumptions
such as the discount rate and the terminal
 
growth rate.
 
We also tested controls over management’s review
 
of the integrity of the
data used and the mathematical accuracy
 
of their valuation model.
 
To test the estimated recoverable amount of the U.S. P&C CGUs, our audit procedures
 
included, amongst others, with the
assistance of our valuation specialists, assessing
 
the methodology and testing the significant
 
assumptions and underlying data used
by TD in its assessment. We considered the
 
selection and application of the discount
 
rate by evaluating the inputs and
mathematical accuracy of the calculation,
 
while also developing an independent estimate
 
and comparing it to the discount rate
selected by management. We considered the
 
selection and application of the terminal
 
growth rate by evaluating the selected rate
against relevant market and economic forecast
 
data. We evaluated the reasonability of the
 
forecasted earnings by comparing to
historical results and considering our current
 
understanding of the business as well as
 
current economic trends. We assessed the
historical accuracy of management’s prior year
 
estimates by performing a comparison of
 
management’s prior year projections to
actual results. We performed sensitivity analysis on
 
the significant assumptions to consider
 
the impact of changes in the recoverable
amount that would result from changes in
 
the assumptions. We also assessed the adequacy
 
of the disclosures related to the
valuation of goodwill.
Other Information
Management is responsible for the other information.
 
The other information comprises:
●
 
Management’s Discussion and Analysis; and
●
 
The information, other than the consolidated
 
financial statements and our auditor’s report
 
thereon, in the 2025 Annual Report
.
Our opinion on the consolidated financial
 
statements does not cover the other information
 
and we do not express any form of assurance
 
conclusion thereon.
 
In connection with our audit of the consolidated
 
financial statements, our responsibility is
 
to read the other information, and in doing
 
so, consider whether the other
information is materially inconsistent
 
with the consolidated financial statements
 
or our knowledge obtained in the audit or otherwise
 
appears to be materially
misstated.
 
We obtained Management’s Discussion and Analysis
 
and the 2025 Annual Report prior to the date
 
of this auditor’s report. If, based on
 
the work we have
performed, we conclude that there is a material
 
misstatement of this other information,
 
we are required to report that fact in this auditor’s
 
report. We have nothing
to report in this regard.
Responsibilities of Management and
 
Those Charged with Governance for
 
the Consolidated Financial Statements
Management is responsible for the preparation
 
and fair presentation of the consolidated
 
financial statements in accordance with IFRS,
 
and for such internal control
as management determines is necessary
 
to enable the preparation of consolidated
 
financial statements that are free from material
 
misstatement, whether due to
fraud or error.
In preparing the consolidated financial
 
statements, management is responsible for assessing
 
TD’s ability to continue as a going concern, disclosing,
 
as applicable,
matters related to going concern and using
 
the going concern basis of accounting
 
unless management either intends to liquidate
 
TD or to cease operations, or has
no realistic alternative but to do so.
Those charged with governance are responsible
 
for overseeing TD’s financial reporting process.
Auditor’s Responsibilities for the Audit
 
of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance
 
about whether the consolidated financial
 
statements as a whole are free from material misstatement,
 
whether
due to fraud or error, and to issue an auditor’s report that includes
 
our opinion. Reasonable assurance is
 
a high level of assurance, but is not a guarantee
 
that an
audit conducted in accordance with Canadian
 
generally accepted auditing standards
 
will always detect a material misstatement when
 
it exists. Misstatements can
arise from fraud or error and are considered
 
material if, individually or in the aggregate,
 
they could reasonably be expected to influence
 
the economic decisions of
users taken on the basis of these consolidated
 
financial statements.
As part of an audit in accordance with Canadian
 
generally accepted auditing standards,
 
we exercise professional judgment and maintain
 
professional skepticism
throughout the audit. We also:
●
 
Identify and assess the risks of material
 
misstatement of the consolidated financial
 
statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and
 
obtain audit evidence that is sufficient and appropriate
 
to provide a basis for our opinion. The
 
risk of not detecting a
material misstatement resulting from fraud
 
is higher than for one resulting from error, as fraud may
 
involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal
 
control.
●
 
Obtain an understanding of internal control relevant
 
to the audit in order to design audit procedures
 
that are appropriate in the circumstances, but
 
not for the
purpose of expressing an opinion on the effectiveness
 
of TD’s internal control.
●
 
Evaluate the appropriateness of accounting
 
policies used and the reasonableness
 
of accounting estimates and related disclosures
 
made by management.
●
 
Conclude on the appropriateness of management’s
 
use of the going concern basis of accounting
 
and, based on the audit evidence obtained,
 
whether a material
uncertainty exists related to events or conditions
 
that may cast significant doubt on TD’s ability to
 
continue as a going concern. If we conclude
 
that a material
uncertainty exists, we are required to draw
 
attention in our auditor’s report to the related
 
disclosures in the consolidated financial statements
 
or, if such
disclosures are inadequate, to modify our
 
opinion. Our conclusions are based on
 
the audit evidence obtained up to the date
 
of our auditor’s report. However,
future events or conditions may cause TD
 
to cease to continue as a going concern.
●
 
Evaluate the overall presentation, structure and
 
content of the consolidated financial statements,
 
including the disclosures, and whether
 
the consolidated
financial statements represent the underlying
 
transactions and events in a manner that achieves
 
fair presentation.
●
 
Plan and perform the group audit to obtain sufficient
 
appropriate audit evidence regarding
 
the financial information of the entities or business
 
units within TD as
a basis for forming an opinion on the consolidated
 
financial statements. We are responsible for the
 
direction, supervision and review of the
 
work performed for
the purposes of the group audit. We remain solely
 
responsible for our audit opinion.
 
 
 
 
 
 
 
 
 
 
We communicate with those charged with governance
 
regarding, among other matters, the planned
 
scope and timing of the audit and significant
 
audit findings,
including any significant deficiencies in internal
 
control that we identify during our audit.
We also provide those charged with governance
 
with a statement that we have complied
 
with relevant ethical requirements regarding
 
independence, and to
communicate with them all relationships and
 
other matters that may reasonably be thought
 
to bear on our independence, and where
 
applicable, related
safeguards.
From the matters communicated with
 
those charged with governance, we determine
 
those matters that were of most significance
 
in the audit of the consolidated
financial statements of the current period
 
and are therefore the key audit matters.
 
We describe these matters in our auditor’s report
 
unless law or regulation
precludes public disclosure about the matter
 
or when, in extremely rare circumstances,
 
we determine that a matter should not be
 
communicated in our report
because the adverse consequences of doing
 
so would reasonably be expected to outweigh
 
the public interest benefits of such communication.
The engagement partner on the audit resulting
 
in this independent auditor’s report is
 
Helen Mitchell.
/s/ Ernst & Young LLP
Chartered Professional Accountants
Licensed Public Accountants
Toronto, Canada
December 3, 2025
December 4, 2025
Shareholders and Directors of The Toronto-Dominion Bank
We are aware that The Toronto-Dominion Bank will furnish EY's Independent Auditor's
 
Report prepared in accordance with Canadian
 
generally accepted auditing
standards and dated December 3, 2025
 
as .6 to its Form 6-K filed on
 
December 4, 2025.
.
/s/ Ernst & Young LLP
Chartered Professional Accountants
Licensed Public Accountants