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HomeMy WebLinkAboutFinancial Statements 2001 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Financial Statements December 31, 2001 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Financial Statements Year Ended December 31, 2001 INDEX SECTION Consolidated Financial Statements 1 Unconsolidated Trust Funds 2 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Financial Statements December 31, 2001 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Financial Statements Year Ended December 31, 2001 Table of Contents PAGE Auditors'Report 1 Statement of Financial Position 2 Statement of Financial Activities 3 Statement of Changes in Financial Position 4 Notes to the Financial Statements 5 - 10 Schedule of Funds 11 - 13 GRAHAM • SCOTT • ENNS LLP Chartered Accountants 25 John Street South Telephone: (519) 773-9265 Aylmer, Ontario Facsimile: (519) 773-9683 N5H 2C1 www.grahamscottenns.com AUDITORS' REPORT To the Members of Council,Inhabitants and Ratepayers of The Corporation of the Municipality of Bayham We have audited the consolidated balance sheet of The Corporation of the Municipality of Bayham as at December 31, 2001 and the consolidated statement of financial activities and changes in financial position for the year then ended. These financial statements are the responsibility of the Municipality's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. In our opinion, these consolidated financial statements present fairly, in all material respects, the financial position of The Corporation of the Municipality of Bayham as at December 31, 2001 and the results of its operations and changes in financial position for the year then ended in accordance with Canadian generally accepted accounting principles. Aylmer, Ontario9)414,40fSeca Seed, 1.47) March 25, 2002 CHARTERED ACCOUNTANTS - 1 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Financial Position As At December 31, 2001 2001 2000 ASSETS Financial Assets Cash and short term deposits 1,218,065 4,027,340 Taxes receivable 407,955 378,051 Accounts receivable 344,686 570,429 Other current assets 6,858 13.895 TOTAL ASSETS 1,9® 989 715 LIABILITIES Liabilities Temporary bank advances (note 4) 2,000,000 - Deferred revenue- obligatory reserve funds (note 7) 60,821 55,748 Accounts payable and accrued liabilities 357,974 1,368,492 Net long-term liabilities (note 4) 173,290 195.204 2,5 9� 1.619.444 MUNICIPAL POSITION FUND BALANCES (NOTE 5) Current fund(page 11) 39,550 268,054 Capital fund(page 12) (1,749,677) 2,451,146 Reserves(page 13) 1,247,650 767,640 Reserve funds (page 13) 22,300, 78 635 (440,177) 3,565,475 AMOUNTS TO BE RECOVERED From future revenues (174344) (195,204) TOTAL MUNICIPAL POSITION (614,521) 3370,271 TOTAL LIABILITIES AND MUNICIPAL POSITION 1.977.564 989 715 See accompanying notes to the consolidated financial statements. 2 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Financial Activities Year Ended December 31, 2001 2001 2000 REVENUES Property taxation 1,541,826 1,482,749 Taxation from other governments 40,143 21,294 User charges 529,476 579,466 Government grants 4,188,653 14,756,669 Investment income 140,127 512,678 Penalties and interest on taxes 54,105 48,975 Other 18,847 X29 516 Total Revenues 6,513,177 17.431.347 EXPENDITURES Current General government 425,531 454,244 Protection to persons and property 758,281 723,226 Transportation services 816,017 861,786 Environmental services 575,822 505,059 Health services 33,366 28,462 Social and family services 1,889 6,790 Recreation and cultural services 192,174 223,102 Planning and development 107,150 85.539 Total current expenditures 2.910,230 2.888.208 Capital Protection to persons and property 29,429 203,834 Transportation services 355,394 227,881 Environmental services 7,098,307 11,604,862 Health services 18,943 - Recreation and cultural services 50,525 21,367 Planning and development 24.040 48,472 Total capital expenditures 7.576.638 12.106.416 Total Expenditures 10.486.868 14.994.624 NET REVENUESI(EXPENDITURES) (3,973.691) 2.436.723 Decrease in amounts to be recovered (31,961) (30.041) CHANGE IN FUND BALANCES (4,005,652) 2 406 682 See accompanying notes to the consolidated financial statements. - 3 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Changes in Financial Position Year Ended December 31, 2001 2001 2000 OPERATIONS Net revenues (3.973.691) 2,436,723 Uses: Increase in taxes receivable (29,904) (56,206) Increase in accounts receivable - (306,498) Decrease in accounts payable and accrued liabilities (1.010.518) - (1.040.422) (362,704) Sources: Decrease in accounts receivable 225,743 - Decrease in other current assets 5,983 3,552 Increase in temporary bank advances 2,000,000 - Increase in accounts payable and accrued liabilities - 799,425 Increase in deferred revenue-obligatory reserve funds 5.073 4.118 2.236.799 807,-095 Net change in cash from operations (2.777.314) 2,881,114 FINANCING Long-term debt repayment (31,961) (30,041) Net change in cash from financing (31.961) (30,041) NET CHANGE IN CASH AND CASH EQUIVALENTS (2,809,275) 2,851,073 OPENING CASH AND CASH EQUIVALENTS 4.027.340 1 176 267 CLOSING CASH AND CASH EQUIVALENTS 1,218,065 4 00227.340 See accompanying notes to the consolidated financial statements. -4- THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2001 The Municipality of Bayham is a municipality in the Province of Ontario. it conducts its operations guided by the provisions of provincial statutes such as the Municipal Act,Municipal Affairs Act and related legislation. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements of the Corporation of the Municipality of Bayham are prepared by management in accordance with generally accepted accounting principles for local governments as recommended by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants. Significant aspects of the accounting policies adopted by the Municipality are as follows: Reporting Entity The consolidated financial statements reflect the assets, liabilities, revenues, expenditures and fund balances of the reporting entity. The reporting entity is comprised of all organizations, committees and local boards accountable for the administration of their financial affairs and resources to the Municipality and which are owned or controlled by the Municipality. These fmancial statements include: -Various Community Centre Boards -Various Cemetery Boards -Museum Board Interdepartmental and inter-organizational transactions and balances between these organizations are eliminated. The following joint local board is not consolidated: (see Note 2 and 8) Elgin Area Primary Water Board Fund Accounting Funds within the consolidated financial statements consist of current, capital and reserve funds. Transfers between funds are recorded as adjustments to the appropriate municipal fund balance. Trust funds and their related operations administered by the municipality are not included in these financial statements but are reported on separately on the Trust Funds Statement of Continuity and Balance Sheet. Capital Assets Expenditures made on capital assets are reported as capital expenditures on the statement of financial activities in the period incurred. - 5 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2001 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Reserves and Reserve Funds Certain amounts, as approved by Municipal Council, are set aside in reserves and reserve funds for future operating and capital purposes. Transfers to and/or from reserves and reserve funds are an adjustment to the respective fund when approved. Government Transfers Government transfers are recognized in the financial statements as revenues in the period in which events giving rise to the transfer occur, providing the transfers are authorized, any eligibility criteria have been met, and reasonable estimates of the amounts can be made. Deferred Revenue Deferred revenues represent user charges and fees which have been collected but for which the related services have yet to be performed. These amounts will be recognized as revenues in the fiscal year the services are performed. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenditures during the period. Actual results could differ from these estimates. 2. CONTRIBUTIONS TO UNCONSOLIDATED JOINT BOARDS Further to note 1, the Municipality contributed $42,802 in the current year (2000 - $45,210) to the Elgin Area Primary Water Board. The Municipality is contingently liable or has contingent gains for its share of any deficits/surpluses, reserves/reserve funds and long-term liabilities which may arise or be incurred by the Elgin Area Primary Water Board. See Note 8 for further discloser on the Elgin Area Water Board. - 6 - THE CORPORATION OF THE MUNICIPALITY OF BAYIIAM Notes to the Consolidated Financial Statements Year Ended December 31, 2001 3. OPERATION OF SCHOOL BOARDS AND THE COUNTY OF ELGIN During 2001, requisitions were made by the school boards and the County of Elgin requiring the municipality to collect property taxes and payments in lieu of property taxes on their behalf. The amounts collected and remitted are summarized below: School Boards County Taxation and user charges 1,238,216 1,323,104 Share of payments in lieu of taxes - 13.897 Amounts requisitioned 1.238.216 1.3® 4. NET LONG-TERM LIABILITIES a) The balance of net long-term liabilities reported on the Consolidated Statement of Financial Position is made up of the following: 2001 2000 Total long-term liabilities incurred by the municipality, including those incurred on behalf of benefiting landowner 2.1® 195204 b) Of the long-term liabilities reported in (a) of this note, $1,001,712 in principal repayments are payable from 2002 to 2006 and $1,171,578 in 2007 and beyond. These are summarized as follows: 2002-6 2007 and beyond -from general revenues 92,098 -from benefiting 909.614 1.171.578 1.001.712 1.171.578 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2001 4. NET LONG-TERM LIABILITIES (CONTINUED) c) All long-term liabilities issued on or before December 31, 1992 have received approval of the Ontario Municipal Board. Long-term liabilities issued after January 31, 1993 have been approved by by-law. The annual principal and interest payments required to service these liabilities are within the annual debt repayment limit prescribed by the Ministry of Municipal Affairs and Housing d) Interest expense on long-term liabilities in 2001 amounted to $13,086 (2000 - $17,067) 5. MUNICIPAL FUND BALANCES AT THE END OF THE YEAR The Municipality's fund balances are comprised of the following: 2001 2000 For general reduction of taxation: Municipality 506 236,714 Cemetery boards 60,773 59,054 Benefiting land owners (21,729) (27.714) 39,550 268,054 For acquisition of fixed assets (1,749,677) 2,451,146 Reserves 1,247,650 767,640 Reserve Funds 22,300 78.635 (440,177) 33 565475475 6. TRUST FUNDS Trust funds administered by the municipality amounting to $208,099 (2000 - $195,204) have not been included in the Consolidated Balance Sheet nor have their operations been included in the Consolidated Statement of Operations. - 8 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2001 7. DEFERRED REVENUE - OBLIGATORY RESERVE FUNDS A requirement of the public sector accounting principles of the Canadian Institute of Chartered Accountants, is that obligatory reserve funds be reported as deferred revenue. This requirement is in place as provincial legislation restricts how these funds may be used and under certain circumstances these funds may possibly be refunded. The balances in the obligatory reserve funds of the Municipality are summarized below: 2001 2000 Development Charges 11,089 10,771 Parkland 49.732 44.977 6._0 821 55 748 8. CONTRACTUAL OBLIGATION-CITY OF LONDON/ONTARIO CLEAN WATER In accordance with a service agreement entered into by the municipality with the Ontario Clean Water Agency - OCWA, the existing Elgin Area Primary Water Supply System is owned and operated by the Agency. The municipality is obligated to meet its share of the operating costs and deficits and repay its share of the long-term liabilities related to these projects. The municipality's share is based on its water consumption relative to that of the other participating municipalities. As of September 1, 1998, the municipality has authorized the City of London to take over the administrative functions of the Primary Water Supply System including the issuance of debt to pay out the balance of debt and accumulated deficit of the participating municipalities. Charges related to operating costs and debt servicing are recovered through the water rates levied by the Municipality. Information received from the City of London as at December 31, 2001 indicates the following: Outstanding Contractual Accumulated 2001 Debt Long-term Obligation Surplus Charges Liabilities Primary Water Supply System City of London 37 267 11.902 90.499 The operating surplus and long-term liabilities indicated above are not reflected in the accompanying financial statements. - 9- THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2001 9. BUDGET FIGURES The Council of the Municipality of Bayham completes separate budget reviews for its operating and capital funds each year. The approved operating budget for 2001 is reflected on the Schedule of Current Fund Activities. For capital spending, budgets are set for individual projects and funding for these activities is determined annually and and made by transfers from reserve funds, operating funds and by the application of applicable grants or other funds available to apply to capital projects. During 2001, Council approved transfers totalling $212,700 (2000 - $792,950) from reserve funds for capital projects. As many capital projects are carried out over one or more years, it is not practical to present annualized budget information on the Schedule of Capital Operations. 10. PUBLIC SECTOR SALARY DISCLOSURE In 2001, no employees were paid a salary, as defined in the Public Sector Salary Disclosure Act, 1996, of$100,000 or more by The Corporation of the Municipality of Bayham. - 10 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Current Fund Operations Year Ended December 31, 2001 Budget 2001 2001 2000 REVENUES Property taxation 1,566,244 1,541,826 1,482,749 Taxation from other governments 43,376 40,143 21,294 User charges 632,059 522,054 496,605 Government grants 1,320,540 1,466,197 1,267,588 Investment income 55,000 79,576 69,387 Penalties and interest on taxes 43,000 54,105 48,975 Other _ 12.000 18,847 29.516 Total Revenues 3.672.219 3,722,748 3.416.114 EXPENDITURES General government 436,383 425,531 454,244 Protection to persons and property 858,027 758,281 723,226 Transportation services 928,976 816,017 861,786 Environmental services 604,174 575,822 505,059 Health services 61,763 33,366 28,462 Social and family services 7,000 1,889 6,790 Recreation and cultural services 207,507 192,174 223,102 Planning and development 121.564 107,150 85.539 Total Expenditures 3.225.394 2,910,230 2.888.208 NET REVENUES/(EXPENDITURES) 446.825 812,518 527,906 FINANCING AND TRANSFERS Transfers to reserves and reserve funds (59,634) (557,010) (130,304) Transfers to capital fund (393,094) (452,051) (406,502) Debt principal repayment (31.961) (31,961) (30,041) Net financing and transfers (484.689) (1,041,022) (566.847) CHANGE IN CURRENT FUND BALANCE (37,864) (228,504) (38,941) OPENING CURRENT FUND BALANCE 268.054 268,054 306.995 CLOSING CURRENT FUND BALANCE 230.190 39 550 268.054 - 11 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Capital Fund Operations Year Ended December 31, 2001 2001 2000 REVENUES Government grants 2,722,456 13,489,081 Investment income 57,221 432,797 Other 7,422 82.861 Total Revenues 2,787.099 14.004.739 EXPENDITURES Protection to persons and property 29,429 203,834 Transportation services 355,394 227,881 Environmental services 7,098,307 11,604,862 Health services 18,943 Recreation and cultural services 50,525 21,367 Planning and development 24.040 48.472 Total Expenditures 7.576.638 12.106.416 NET REVENUES/(EXPENDITURES) (4.789.539) 1.898.323 FINANCING AND TRANSFERS Transfers from reserves and reserve funds 136,665 727,511 Transfers from operating fund 452,051 406,502 Net financing and transfers 588.716 1 134 013 CHANGE IN CAPITAL FUND BALANCE (4,200,823) 3,032,336 OPENING CAPITAL FUND BALANCE 2,451,146 (581.190) CLOSING CAPITAL FUND BALANCE (1.749,677) 2.451.146 - 12 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Reserves and Reserve Funds Year Ended December 31, 2001 2001 2000 REVENUES Investment income 3.330 10.494 Net revenues 3.330 10.494 FINANCING AND TRANSFERS Transfers to capital fund (136,665) (727,511) Transfer from current fund 557 130.304 Net transfers 420.345 (597.207) CHANGE IN RESERVE AND RESERVE FUND BALANCES 423,675 (586,713) OPENING RESERVE AND RESERVE FUND BALANCE 846.275 1.432988 CLOSING RESERVE AND RESERVE FUND BALANCE 1.2® 846.275 ANALYZED AS FOLLOWS: Reserves set aside for specific purposes by Council: - for working capital 334,307 334,307 for capital purposes 457,801 246,535 - for waterworks purposes 82,125 111,045 - for rate stabilization 236,714 - - for other purposes 136.703 75.753 Total reserves 1.247.650 767.640 Reserve funds set aside for specific purposes by Council: - for water system - 9,597 - for construction of sanitary and storm sewers 17,051 36,041 - for parks and recreation purposes - 27,980 - for other purposes 5.249 5.017 Total reserve funds 22.300 78.635 TOTAL RESERVES AND RESERVE FUNDS 1.2� 846.275 - 13 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Unconsolidated Trust Funds December 31, 2001 GRAHAM • SCOTT • ENNS LLP Chartered Accountants 450 Sunset Drive Telephone: (519) 633-0700 St. Thomas, Ontario Facsimile: (519) 633-7009 N5R 5V1 www.grahamscottenns.com AUDITORS' REPORT To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Municipality of Bayham We have audited the trust fund balance sheet of The Corporation of the Municipality of Bayham as at December 31, 2001 and the trust fund statement of continuity for the year then ended. These financial statements are the responsibility of the Municipality's management. Our responsibility is to express an opinion on these fmancial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we plan and perform an audit to obtain reasonable assurance whether the fmancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. In our opinion, these financial statements present fairly, in all material respects, the financial position of the trust fund of the Municipality as at December 31, 2001 and the continuity of trust fund for the year then ended in accordance with Canadian generally accepted accounting principles. Aylmer, Ontario Score &m4, 44 March 25,2002 CHARTERED ACCOUNTANTS -- ---- See accompanying notes to the financial statements THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Trust Funds Balance Sheet As At December 31, 2001 Cemeteries Care and O.H.R.P. Developers' Total Maint Fund Funds Deposits 2001 Assets Cash 64,717 22 18,612 83,351 Acounts receivable 35,414 745 - 36,159 Loans receivable - 1,866 - 1,866 Debentures 86.723 - - 86.723 18� 2 633 18.612 208,099 Liabilities Administration fees &interest payable - 46 - 46 Accounts payable 14.876 _ 708 - 15.584 14,876 754 - 15,630 Fund Balances Capital balance 171.978 1.879 18.612 192.469 186 854 2 633 18 612 208.099 See accompanying notes to the financial statements THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Trust Funds Statement of Continuity As At December 31, 2001 Cemeteries Care and O.H.R.P. Developers' Total Maint Fund Funds Deposits 2001 Balance,beginning of year 172.015 2.441 17.878 192334 Capital receipts Sale of plots/monuments 2,514 - - Interest earned 10.096 192 734 11.022 12.610192 734 11.022 Expenditures Payments to cemetery board 12,557 - - 12,557 Repayment to Ministry of Housing - 708 - 708 Administration fees - 46 - 46 Death taxes 90 - 90 1 2 647 754 - 13.401 Balance, end of year 17� 1 879 18 612 192.469 See accompanying notes to the financial statements THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Trust Funds Notes to the Financial Statements As At December 31, 2001 1. SIGNIFICANT ACCOUNTING POLICY Basis of accounting Capital receipts and income are reported on the cash basis of accounting. Expenditures are reported on the cash basis of accounting with the exception of administrative expenses which are reported on the accrual basis of accounting, which recognizes expenditures as they are incurred and measurable as a result of the receipt of goods or services and the creation of a legal obligation to pay. 2. ONTARIO HOME RENEWAL PROGRAM The Ontario Home Renewal Program was established by the Ontario Ministry of Housing in 1973 to provide grants for municipalities to make loans to assist owner occupants to repair, rehabilitate and improve their home to local property standards. Individual loans are limited to $7,500 of which the maximum forgivable portion is $4,000. Ontario Home Renewal Program loans receivable at December 31,2001 comprise repayable loans of $1,866 (2000- $2,428) and forgivable loans of $nil (2000 - nil). Loan forgiveness is earned and recorded at a rate of up to $600 per year of continued ownership and occupancy. In the event of the sale or lease of the home or in the event of the homeowner ceasing to occupy the home, the balances of the repayable loan and the unearned forgivable loan immediately become due and payable by the homeowner. 3. CEMETERIES CARE AND MAINTENANCE FUND The cemeteries care and maintenance fund administered by the Municipality is funded by the sale of cemetery plots. These funds are invested and earnigs derived therefrom are used to perform perpetual care and maintenance to the municipality's cemeteries. The operations and investments of the Fund are undertaken by the Municipality in accordance with the regulations of the Cemeteries Act.