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HomeMy WebLinkAboutFinancial Statements 2004 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Financial Statements December 31, 2004 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Financial Statements Year Ended December 31, 2004 INDEX SECTION Consolidated Financial Statements 1 Unconsolidated Trust Funds 2 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Financial Statements Year Ended December 31, 2004 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 William A.Graham' John M.Scott* SCOTT Alan R.Eons* Michael S.Stover* E N N S Robert R.Foster* •CHARTERED ACCOUNTANTS Betty A.Crop James G.Frederick Phone: (519)633-0700 Fax: (519) 633-7009 450 Sunset Drive,St.Thomas,ON NSR 5V1 *Practicing through a Professional Corporation 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, 2004 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, 2004 and the results of its operations and changes in financial position for the year then ended in accordance with Canadian generally accepted accounting principles. St. Thomas, Ontario9/44-eleaSeat 5044 March 7, 2005 CHARTERED ACCOUNTANTS - 1 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Financial Position As At December 31, 2004 2004 2003 ASSETS Financial Assets Cash and short term deposits 1,064,879 1,213,751 Taxes receivable 544,116 501,108 Accounts receivable 288,743 228,214 Other current assets 13,570 13,137 TOTAL ASSETS L91L308 1.956,210 LIABILITIES Liabilities Deferred revenue- obligatory reserve funds (note 7) 71,994 54,555 Accounts payable and accrued liabilities 316,358 330,992 Net long-term liabilities (note 4) 1,363.723 1,515.892 1,752.075 1.901.439 MUNICIPAL POSITION FUND BALANCES (NOTE 5) Current fund(page 11) 17,695 34,745 Capital fund(page 12) 193,483 313,597 Reserves (page 13) 1,265,436 1,187,797 Reserve funds (page 13) 46,342 34.524 1,522,956 1,570,663 AMOUNTS TO BE RECOVERED From future revenues (1.363,723) (1,515,892) TOTAL MUNICIPAL POSITION 159,233 54.771 TOTAL LIABILITIES AND MUNICIPAL POSITION 19� 11 308 1 9 56 210 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, 2004 2004 2003 REVENUES Property taxation 1,954,287 1,773,413 Taxation from other governments 43,832 41,367 User charges 910,532 820,340 Government grants 1,611,295 1,560,078 Contribution from developers 2,858 18,116 Investment income 39,279 51,839 Penalties and interest on taxes 73,632 72,194 Recoveries from benefiting landowners 217,095 268,407 Other 34.247 80.798 Total Revenues 4.887,057 4.686.552 EXPENDITURES Current General government 470,829 479,709 Protection to persons and property 1,028,254 975,182 Transportation services 1,035,548 1,005,214 Environmental services 922,501 873,339 Health services 33,295 42,673 Social and family services 3,525 4,150 Recreation and cultural services 244,782 248,359 Planning and development 133.140 102,380 Total current expenditures 3,871,874 3.731.006 Capital General government 13,939 10,197 Protection to persons and property 44,793 244,012 Transportation services 502,176 567,298 Environmental services 233,269 269,949 Health services - 1,738 Recreation and cultural services 70,813 42,118 Planning and development 28,983 48,903 Total capital expenditures 893,973 1,184.215 Total Expenditures 4,765,847 4,915.221 NET REVENUES/(EXPENDITURES) 121,210 (228,669) Decrease in amounts to be recovered (168,917) (160,665) CHANGE IN FUND BALANCES (47,707) . (389,334) 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, 2004 2004 2003 OPERATIONS Net revenues 121,210 (228,669) Uses: Increase in taxes receivable (43,008) (59,282) Increase in accounts receivable (60,529) - Increase in other current assets (433) (2,352) Decrease in accounts payable and accrued liabilities (14,634) - Decrease in deferred revenue - obligatory reserve funds - (1.321) (118.604) (62,955) Sources: Decrease in accounts receivable - 72,164 Increase in accounts payable and accrued liabilities - 112,049 Increase in deferred revenue - obligatory reserve funds 17.439 - 17,439 184,213 Net change in cash from operations 20,045 (107,411) FINANCING Long-term debt repayment (168,917) (160,665) Net change in cash from financing (168.917) (160,665) NET CHANGE IN CASH AND CASH EQUIVALENTS (148,872) (268,076) OPENING CASH AND CASH EQUIVALENTS 1,213,751 1,481,827 CLOSING CASH AND CASH EQUIVALENTS 1!064,879 1,213.751 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, 2004 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 financial statements include: - Various Community Centre Boards - Various Cemetery Boards -Museum Board Inter-departmental 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, 2004 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 Canadian generally accepted accounting principles require 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 $65,704 in the current year (2003 - $58,143) to the Elgin Area Primary Water Board. The Municipality is contingently liable or has contingent gains for its share of any deficit/surplus, 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 disclosure on the Elgin Area Water Board. - 6 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2004 3. OPERATION OF SCHOOL BOARDS AND THE COUNTY OF ELGIN During 2004, 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 1,208,686 1,827,448 Share of payments in lieu of taxes - 21.201 Amounts requisitioned 1.208,686 1848� 649 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: 2004 2003 _ $ Total long-term liabilities incurred by the municipality, including those incurred on behalf of benefiting landowner 1,363,723 1,515892 Principal repayments are summarized as follows: 2005 2006 2007 2008 2009 Beyond Total Recoverable From General tax revenue - - - - -Benefiting landowners 156.595 158.181 168.315 178.257 185,633 516.742 1,363,723, 156,595 158 181 168,315 178,257 185.633 51 6 742 1 36632 -7 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2004 4. NET LONG-TERM LIABILITIES (CONTINUED) b) 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 c)Interest expense on long-term liabilities in 2004 amounted to $95,033 (2003 - $105,368) 5. MUNICIPAL FUND BALANCES AT THE END OF THE YEAR The Municipality's fund balances are comprised of the following: 2004 2003 For general reduction of taxation: Municipality - Cemetery boards 75,980 63,171 Benefiting landowners (58.285) (28,426) 17,695 34,745 For acquisition of fixed assets 193,483 313,597 Reserves 1,265,436 1,187,797 Reserve funds 46.342 34,524 1.5 22956 15570663 6. TRUST FUNDS Trust funds administered by the municipality amounting to $213,830 (2003 - $201,227) 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, 2004 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 be refunded. The balances in the obligatory reserve funds of the Municipality are summarized below: 2004 2003 Development Charges 9,594 9,094 Parkland 62.400 45.461 7994 54 555 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, 2004 indicates the following: Outstanding Contractual Accumulated 2004 Debt Long-term Obligation Surplus Charges Liabilities Primary Water Supply System City of London 40 304 69,187 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, 2004 9. BUDGET FIGURES The Council of the Municipality of Bayham completes separate budget reviews for its operating and capital funds each year. The approved 2004 operating and capital budgets are reflected on the respective schedules of operations. Funding for the capital projects is made by transfers from reserve and operating funds, application of associated grants, and the use of other funds available to apply to capital projects. During 2004, Council approved transfers totaling $310,151 (2003 - $716,004) from reserve and reserve funds for capital projects. As many capital projects are carried out over one or more years, the annualized budget information on the Consolidated Schedule of Capital Operations represents the budget portion of expenditures for the current year only. 10. PUBLIC SECTOR SALARY DISCLOSURE In 2004, 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, 2004 Unaudited Budget 2004 2004 2003 REVENUES Property taxation 1,943,850 1,954,287 1,773,413 Taxation from other governments 43,832 43,832 41,367 User charges 933,529 861,961 802,707 Government grants 1,539,001 1,578,802 1,560,078 Investment income 35,000 37,949 51,512 Penalties and interest on taxes 58,000 73,632 72,194 Recoveries from benefiting landowners 221,195 192,683 219,943 Other 18 150 33,603 30,584 Total Revenues 4.792.557 4,776,749 4,551,798 EXPENDITURES General government 469,284 470,829 479,709 Protection to persons and property 1,029,649 1,028,254 975,182 Transportation services 1,003,064 1,035,548 1,005,214 Environmental services 930,690 922,501 873,339 Health services 41,809 33,295 42,673 Social and family services 3,700 3,525 4,150 Recreation and cultural services 252,836 244,782 248,359 Planning and development 119.371 133,140 102,380 Total Expenditures 3.850.403 3,871,874 3.731,006 NET REVENUES/(EXPENDITURES) 942.154 904,875 820.792 FINANCING AND TRANSFERS Transfers to reserves and reserve funds (149,936) (142,460) (131,893) Transfers to capital fund (623,303) (610,548) (530,404) Debt principal repayment (168,915) (168,917) (160.665) Net financing and transfers (942,154) (921,925) (822.962) CHANGE IN CURRENT FUND BALANCE (17,050) (2,170) OPENING CURRENT FUND BALANCE 34.745 34,745 36,915 CLOSING CURRENT FUND BALANCE _ 34`745 17 695 34 745 - 11 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Capital Fund Operations Year Ended December 31, 2004 Unaudited Budget 2004 2004 2003 REVENUES Government grants 2,700 32,493 - Contribution from developers - 2,858 18,116 Sale of assets - 644 50,214 Benefiting landowners - 24,412 48,464 Other _ 13.500 48,571 17.633 Total Revenues 16,200 108,978 134.427 EXPENDITURES General government 53,700 13,939 10,197 Protection to persons and property 269,286 44,793 244,012 Transportation services 586,000 502,176 567,298 Environmental services 397,937 233,269 269,949 Health services - - 1,738 Recreation and cultural services 107,878 70,813 42,118 Planning and development _ 53,900 28,983. 48,903 Total Expenditures 1.468.701 893,973 1.184,215 NET REVENUES/(EXPENDITURES) (1,452.501) (784,995) (1.049,788) FINANCING AND TRANSFERS Transfers from reserves and reserve funds 275,151 54,333 466,067 Transfers from operating fund 623,303 610,548 530,404 Proceeds of long term debt 240 450 -Net financing and transfers 1,138.904 664,881 996.471 CHANGE IN CAPITAL FUND BALANCE (313,597) (120,114) (53,317) OPENING CAPITAL FUND BALANCE 313,597 313,597 366.914 CLOSING CAPITAL FUND BALANCE - 1� 9� 3 313.597 - 12- THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Reserves and Reserve Funds Year Ended December 31, 2004 2004 2003 REVENUES Investment income 1.330 327 Net revenues 1,330 327 FINANCING AND TRANSFERS Transfers to capital fund (54,333) (466,067) Transfer from current fund 142,460 131,893 Net transfers 88.127 (334,174) CHANGE IN RESERVE AND RESERVE FUND BALANCES 89,457 (333,847) OPENING RESERVE AND RESERVE FUND BALANCE 1,222,321 1,556,168 CLOSING RESERVE AND RESERVE FUND BALANCE 1 311 778 1,222.321 ANALYZED AS FOLLOWS: Reserves set aside for specific purposes by Council: - for working capital 334,307 334,307 - for capital purposes 531,730 476,422 - for waterworks purposes 10,406 7,952 - for rate stabilization 214,513 214,513 for other purposes 174,480 154,603 Total reserves 1,265s436 1,187,797 Reserve funds set aside for specific purposes by Council: -for construction of sanitary and storm sewers 10,296 9,869 - for cultural service purposes 30,139 18,989 -for other purposes 5,907 5,666 Total reserve funds 46.342 34,524 TOTAL RESERVES AND RESERVE FUNDS 131� 1,222,321 - 13 - % 1GRAHAM SCOTT William A.Graham' John M.Scutt' Alan R.Enns• Michael S.Stover" E N N S Robert B.Foster* •CHARTERED ACCOUNTANTS Betty A.Cropp James G.Frederick Phone: (519)633-0700 Fax:(519)633-7009 450 Sunset Drive,St.Thomas,ON N5R 5V1 'Practicing through a Professional Corporation 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, 2004 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 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 financial statements present fairly, in all material respects, the financial position of the trust fund of the Municipality as at December 31, 2004 and the continuity of trust fund for the year then ended in accordance with Canadian generally accepted accounting principles. St. Thomas, Ontario974/44MSCS &md March 7, 2005 CHARTERED ACCOUNTANTS See accompanying notes to the financial statements THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Trust Funds Balance Sheet As At December 31, 2004 Cemeteries Care and O.H.R.P Developers' Total Maint Fund Funds Deposits 2004 Assets Cash 168,266 - 19,544 187,810 Accounts receivable 4,699 - - 4,699 Loans receivable - 1,866 - 1,866 Debentures 19,455 - - 19,455 192420 1 866 19,544 213,830 Liabilities Accounts payable 81 - - S1 Fund Balances Capital balance 192,339 1,866 19,544 213,749 192 420 1 866 19 544 213,830 See accompanying notes to the financial statements THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Trust Funds Statement of Continuity As At December 31, 2004 Cemeteries Care and O.H.R.P Developers' Total Maint Fund Funds Deposits 2004 Balance, beginning of year 180.148 1.882 19.199 201,229 Capital receipts Sale of plots/monuments 12,900 - - Interest earned 10,063 - 345 10,408 22,963 - 345 10,408 Expenditures Payments to cemetery board 10,747 - - 10,747 Administration fees - 16 16 Death taxes 25 - - 25 10,772 16 - 10,788 Balance, end of year 19� 1 866 19 544 213.749 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, 2004 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, 2004 comprise repayable loans of $1,866 (2003- $1,866) and forgivable loans of $nil (2003 - 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 earnings 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.