A forensic audit has found that Toronto Mayor Rob Ford broke the spending rules during his 2010 mayoral campaign.

"In our opinion, the candidate's campaign expenses ... exceeded the authorized limit by $40,168," said the report from the three-person audit panel.

It means Ford is in an apparent contravention of the Municipal Elections Act.

Ford ran a $1.3-million campaign — but was challenged over money loaned to his campaign by his family company, Deco Labels.

The auditors found that the $77,000 loaned by Deco broke the rules because the campaign did not pay interest on the loan.

In total, the audit uncovered about 100 violations of the Municipal Elections Act.

Ford's brother Doug, who is city councillor, said he and his brother disagree with some of the findings, but in general believe the audits "were very fair."

Doug Ford didn't say what the next step will be, but seemed to indicate his brother will challenge the findings.

"Our interpretation is totally different; 100 per cent different," he told reporters at city hall.

A special prosecutor may now be brought in to sort through the audit findings and decide if further action needs to be taken.

In a statement released by their lawyer, the two men who brought the complaint against Ford — Max Reed and Adam Chaleff-Freudenthaler — said that based on the number of violations uncovered by the audit they "will be requesting the compliance audit committee proceed with prosecution in a timely manner."

Ford could face penalties ranging from a fine all the way to being removed from office — though most political observers say that is unlikely.

Just one week ago, Ford escaped from another threat to his mayoralty when the Ontario Divisional Court ruled in his favour in a conflict of interest case.

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  • Toronto Mayor Rob Ford is hoisted into the air by his Don Bosco Eagles team after winning the Metro Bowl quarter-final at Birchmount Park in Toronto, Thursday Nov. 15, 2012. A civil trial hearing in which the mayor is accused of libel against a restaurant owner went on without him. THE CANADIAN PRESS/Christopher Drost

  • Mayor Rob Ford celebrates hoists the Ross McDonald trophy with his team the Don Bosco Eagles in Toronto, Ont. Thursday, November 8, 2012. (Kevin Van Paassen/The Globe and Mail)

  • Actors Will Ferrell (left) and Zack Galifianakis (centre) receive stickers from Toronto Mayor Rob Ford at the Hockey Hall of Fame as they promote their new movie "The Campaign" in Toronto on Monday, July 30, 2012. THE CANADIAN PRESS/Nathan Denette

  • Actors Will Ferrell (left) and Zack Galifianakis (centre) receive stickers from Toronto Mayor Rob Ford at the Hockey Hall of Fame as they promote their new movie "The Campaign" in Toronto on Monday, July 30, 2012. THE CANADIAN PRESS/Nathan Denette

  • Toronto Mayor Rob Ford (centre) dances with participants ahead of the Toronto Caribbean Carnival in Toronto on Saturday July 30, 2011. THE CANADIAN PRESS/Chris Young

  • Two hours of speeches and entertainment helped to kick off the Scotiabank Toronto Caribbean Carnival at Nathan Phillips Square in Toronto on July 12, 2011. Mayor Rob Ford showed up about half way through, posed for some photographs, made a speech, presented a scroll, cut a cake, posed for more pictures on his way back inside, and even danced for a few notes with a costumed participant. Canadian Press

  • Toronto Mayor Rob Ford, right, looks on as he is about to receive the Pan American games flag at Omnilife Stadium during the closing ceremonies of the 2011 Pan American Games in Guadalajara, Mexico on Sunday, Oct. 30, 2011. Toronto will host the games in 2015. THE CANADIAN PRESS/Nathan Denette

  • Mayor Rob Ford was on hand in the alley way behind 1278 St. Clair Avenue West in Toronto on April 7, 2011 to re-iterate his plans to clean up the graffiti in Toronto. After doing some power washing with a diluted solvent the mayor said it was difficult to remove the graffiti but they would get it done, brick by brick. He was covered in "water" and paint chips when he was done the power washing. (Photo by Peter Power/The Globe and Mail)

  • Toronto, Dec. 16/2010 - Mayor Rob Ford, wearing the Chain of Office necklace, reacts during a chat with 2010-2014 Councillors Doug Holyday (L) and Councillor Frances Nunziata while waiting for their first official group photo at City Hall in Toronto, Ontario, Canada. Besides the absence of a couple of councillors the shoot went off with no problems. Canadian Press

  • Toronto Mayor Rob Ford jumps on stage dressed as a Cannon Doll during a performance of the Nutcracker in Toronto on Saturday, December 10, 2011. THE CANADIAN PRESS/Pawel Dwulit

  • Toronto Mayor Rob Ford (left) and city councillor Michelle Berardinetti (right) smile on stage during a performance of the Nutcracker in Toronto on Saturday, December 10, 2011. THE CANADIAN PRESS/Pawel Dwulit

  • Toronto Mayor Rob Ford (center) smiles as he officially opens the refurbished Sunnydale rink with Toronto Maple Leafs' coach Ron Wilson (right) and other dignitaries who were on hand as well as the Toronto Maple Leafs who practiced on the outdoor rink in Toronto on Wednesday, January 4, 2012. THE CANADIAN PRESS/Pawel Dwulit

  • Donald Trump, left, shakes hands with Toronto Mayor Rob Ford as he was on hand for the grand opening of his new Trump International Hotel & Tower in Toronto, Ont. Thursday, April 16/2012. Canadian Press

  • As part of an exhibition at the CNE, Toronto-based artist Olenka Kleban has made a butter sculpture of Toronto's mayor.

  • Toronto Mayor Rob Ford watches from the sidelines near the Argos bench during a CFL football game between the Toronto Argonauts and Calgary Stampeders in Calgary on Saturday, August 18, 2012. THE CANADIAN PRESS/Larry MacDougal

  • Mayor Rob Ford speaks with a private security guards at Nathan Philips Square in Toronto during an event held on Sept. 21, 2012 to recognize the hockey players of Team Canada 1972 before their Canada's Walk of Fame induction, as a group, on Saturday. Mayor Rob Ford read a proclamation that was presented to each player, and Paul Henderson, who scored the winning goal, presented the Mayor with a hockey sweater. Henderson's original hockey jersey from 1972 was on display behind glass for the event. (Peter Power/The Globe and Mail)

  • Rob Ford is interviewed by the media at the Toronto Congress Center in Etobicoke after his election as Toronto Mayor Monday night, October 25, 2010, Toronto, Canada. The Canadian Press/Michael Hudson

  • Toronto Mayor Rob Ford arrives to watch the Toronto Maple Leafs participate in an outdoor practice at Trinity Bellwoods Park in Toronto Wednesday, December 22, 2010. THE CANADIAN PRESS/Darren Calabrese

  • Rob Ford is seen reading while driving in this photo from Twitter.

  • Toronto Mayor Rob Ford posing in City Hall with the City of Toronto sigh. Canadian Press

  • Rob Ford poses with neo-Nazi Jon Latvis. Ford's office has explained Toronto's mayor was unaware of the man's beliefs when the image was captured.

  • Toronto Mayor-elect Rob Ford, centre, raises his arms with his wife Renata, right, and mother Diane, left, as he speaks to supporters in Toronto on Monday, October 25, 2010. THE CANADIAN PRESS/Nathan Denette