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HomeMy WebLinkAboutFinancial Statements 2013 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Financial Statements December 31, 2013 THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Financial Statements Year Ended December 31, 2013 Table of Contents PAGE Independent Auditors' Report 1 Consolidated Statement of Financial Position 2 Consolidated Statement of Operations and Accumulated Surplus 3 Consolidated Statement of Change in Net Financial Assets 4 Consolidated Statement of Cash Flows 5 Notes to the Consolidated Financial Statements 6 - 17 Consolidated Schedule of Segment Disclosure 18 - 19 Schedule of Segment Disclosure 20 Consolidated Schedule of Tangible Capital Assets 21 - 22 [g GRAHAM SCOTT ENNS LLP CHARTERED PROFESSIONAL ACCOUNTANTS P.519-633-0700 • F.519-633-7009 P.519-773-9265 • E 519-773-9683 450 Sunset Drive,St.Thomas,ON N5R 5V1 25 John Street South,Aylmer,ON N5H 2C1 www.grahamsoottenns.com INDEPENDENT AUDITORS'REPORT To the Members of Council,Inhabitants and Ratepayers of The Corporation of the Municipality of Bayham: Report on the Financial Statements We have audited the accompanying consolidated financial statements of The Corporation of the Municipality of Bayham, which comprise the consolidated statement of financial position as at December 31, 2013, and the statements of consolidated operations and accumulated surplus,changes in net assets,and cash flow for the year then ended, and a summary of significant accounting policies and other explanatory information. Management's Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian accounting standards for public sector entities and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement,whether due to fraud or error. Auditors'Responsibility 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 comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free of material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements,whether due to fraud or error. In making those risk assessments,the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements 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 the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the statement of financial position of The Corporation of the Municipality of Bayham as at December 31, 2013, and the statements of operations and accumulated surplus, changes in net assets, and cash flow for the year then ended in accordance with Canadian accounting standards for public sector entities. St. Thomas, Ontario9)14/1,4044ScateaEgadad4P June 19, 2014 CHARTERED PROFESSIONAL ACCOUNTANTS Licensed Public Accountants - 1 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Financial Position As At December 31, 2013 2013 2012 $ $ ASSETS FINANCIAL ASSETS Cash 2,024,942 1,658,291 Investments (Note 2) 3,089,815 2,997,972 Taxes receivable (Note 3) 821,585 785,841 Accounts receivable 789,573 951,713 6,725,915 6,393,817 LIABILITIES Deferred revenue - obligatory reserve funds (Note 9) 147,662 162,600 Accounts payable and accrued liabilities 995,837 1,057,091 Net long-term liabilities (Note 4) 1,105,855 1,193,887 2,249,354 2,413,578 NET FINANCIAL ASSETS 4,476,561 3,980,239 NON-FINANCIAL ASSETS Tangible capital assets (Note 6,pages 21, 22) 54,574,414 54,890,311 Prepaid expenses 22,494 21,705 54,596,908 54,912,016 ACCUMULATED SURPLUS (NOTE 7) 59,073,469 58,892,255 See accompanying notes to the consolidated financial statements. - 2 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Operations and Accumulated Surplus Year Ended December 31, 2013 Budget Actual Actual 2013 2013 2012 (Note 11) $ $ $ REVENUES Property taxation 3,101,357 3,162,127 3,069,479 Taxation from other governments 63,588 63,588 44,231 User charges 1,527,687 1,757,529 1,788,172 Transfer payments Federal 291,590 251,914 526,327 Provincial 1,246,200 1,468,194 1,415,806 Other municipalities 431,400 481,106 550,406 Investment income 70,000 116,693 121,040 Penalties and interest on taxes 96,000 109,848 104,699 Recoveries from benefiting landowners 126,747 178,118 414,232 Other 13,700 141,280 113,556 Total Revenues 6,968,269 7,730,397 8,147,948 EXPENSES General government 739,289 787,321 715,579 Protection to persons and property 1,495,544 1,490,362 1,464,196 Transportation services 2,372,792 2,613,653 2,604,498 Environmental services 1,813,582 1,994,476 2,049,980 Health services 15,757 33,100 49,545 Social and family services 15,100 15,459 13,934 Recreation and cultural services 322,921 317,294 294,829 Planning and development 214,474 306,003 376,230 Loss (gain) on disposal of tangible capital assets - (8,485) 31,012 Total Expenses (Note 14) 6,989,459 7,549,183 7,599,803 ANNUAL SURPLUS (21,190) 181,214 548,145 ACCUMULATED SURPLUS, BEGINNING OF YEAR 58,892,255 58,892,255 58,344,110 ACCUMULATED SURPLUS, END OF YEAR(NOTE 7) 58,871,065 59,073,469 58,892,255 See accompanying notes to the consolidated financial statements. - 3 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Changes in Net Financial Assets Year Ended December 31, 2013 2013 2012 $ $ ANNUAL SURPLUS 181,214 548,145 Acquisition of tangible capital assets (1,205,412) (1,652,360) Amortization of tangible capital assets 1,494,264 1,496,008 Proceeds on disposal of tangible capital assets 35,528 17,500 Change in prepaid expenses and deferred charges (787) 1,087 Loss (gain) on sale of tangible capital assets (8,485) 31,012 INCREASE IN NET FINANCIAL ASSETS 496,322 441,392 NET FINANCIAL ASSETS, BEGINNING OF YEAR 3,980,239 3,538,847 NET FINANCIAL ASSETS, END OF YEAR 4,476,561 3,980,239 See accompanying notes to the consolidated financial statements. - 4 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Statement of Cash Flows Year Ended December 31, 2013 2013 2012 $ $ OPERATING ACTIVITIES Annual surplus 181,214 548,145 Add (deduct) items not involving cash: Amortization of tangible capital assets 1,494,264 1,496,008 Loss (gain) on disposal of and transfer of assets (8,485) 31,012 1,666,993 2,075,165 Change in non-cash items related to operations (Note 14[b]) 49,415 (159,089) Net change in cash from operating activities 1,716,408 1,916,076 CAPITAL Acquisition of tangible capital assets (1,205,412) (1,652,360) Proceeds on disposal of tangible capital assets 35,528 17,500 Net change in cash from capital (1,169,884) (1,634,860) INVESTING Investment income reinvested (91,843) (93,321) Net change in cash from investing (91,843) (93,321) FINANCING Long-term debt advances - 825,250 Long-term debt repayment (88,031) _ (146,596) Net change in cash from financing (88,031) 678,654 NET CHANGE IN CASH AND CASH EQUIVALENTS 366,650 866,549 OPENING CASH AND CASH EQUIVALENTS 1,658,292 791,743 CLOSING CASH AND CASH EQUIVALENTS 2,024,942 1,658,292 SUPPLEMENTARY INFORMATION: Cash paid for interest on debt 43,256 21,325 Cash received for interest on investments 116,693 121,040 See accompanying notes to the consolidated financial statements. - 5 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 The Corporation of the Municipality of Bayham (the "Municipality") 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 Municipality are prepared by management in accordance with Canadian accounting standards for public sector entities, as recommended by the Public Sector Accounting Board of the Canadian Institute of Chartered Professional Accountants. Significant aspects of the accounting policies adopted by the Municipality are as follows: Reporting Entity The consolidated financial statements include the assets, liabilities, revenues and expenses 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 100% owned or controlled by the Municipality. Consolidated Entities The following local boards are consolidated: -Various Cemetery Boards Inter-departmental and inter-organizational transactions and balances between these organizations are eliminated. Proportionate Consolidation The Elgin Area Primary Water Board and Port Burwell Water Board have been consolidated on a proportionate basis. The Water Boards are proportionately consolidated based upon the water flow used by our Municipality in proportion to the entire flows provided by the joint boards. Accounting for School Board Transactions Although the Municipality collects taxation on behalf of the School Boards, the taxation, other revenues, expenses, assets and liabilities with respect to the operations of the school boards are not reflected in these statements. Trust Funds Trust funds and their related operations administered by the Municipality are not included in these consolidated financial statements. - 6 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Basis of Accounting The consolidated financial statements are prepared using the accrual basis of accounting. The accrual basis of accounting records revenue as it is earned and measurable. Expenses are recognized as they are incurred and measurable based upon receipt of goods or services and/or the creation of a legal obligation to pay. Deferred Revenue Government transfers, contributions and other amounts are received from third parties pursuant to legislation, regulation or agreement and may only be used in the conduct of certain programs, in the completion of specific work. In addition, certain user charges and fees which have been collected but for which the related services have yet to be performed. Revenue is recognized in the period when the related expense are incurred, services preformed. Use of Estimates The preparation of consolidated financial statements in conformity with Canadian accounting standards for public sector entities 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 expenses during the period. In addition, the Municipality's implementation of the Public Sector Accounting Handbook PS3150 has required management to make estimates of historical cost and useful lives of tangible capital assets. These estimates and assumptions are based on the best information and judgment and may differ significantly from actual results. Government Transfers Government transfers are recognized in the consolidated financial statements as revenues in the financial period in which events giving rise to the transfer occur, providing the transfers are authorized, any eligibility criteria have been met including performance and return requirements, and reasonable estimates of the amounts can be determined. Any amount received but restricted is recorded as deferred revenue in accordance with Section 3100 of the Public Sector Accounting Handbook and recognized as revenue in the period in which the resources are used for the purpose specified. In addition, the Municipality periodically receives senior government capital funding in the form of infrastructure grants and receives ongoing funding from both senior levels of government as a result of an allocation of the gas tax funds. - 7 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Non-Financial Assets Non-financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the ordinary course of operations. The change in non-financial assets during the year, together with the excess of revenues over expenses, provides the Change in Net Financial Assets for the year. i) Tangible capital assets Tangible capital assets are recorded at cost which includes all amounts that are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets are amortized on a straight-line basis over their estimated useful lives as follows: Building and components 20 to 75 years Vehicles 5 to 25 years Machinery and equipment 5 to 27 years Land improvements 18 to 25 years Plants and facilities 20 to 75 years Roads 20 to 60 years Bridges and other structures 15 to 80 years Underground and other networks 17 to 100 years No amortization is charged in the year of acquisition and a full year of amortization is charged in the year of disposal. Assets under construction are not amortized until the asset is available for productive use. ii) Contributions of tangible capital assets Tangible capital assets received as contributions are recorded at their fair value at the date of receipt and also are recorded as revenue. iii) Works of art and cultural and historic assets Works of art and cultural and historic assets are not recorded as assets in these financial statements. iv) Interest capitalization The Municipality does not capitalize interest costs associated with the acquisition or construction of a tangible capital asset. v) Leased tangible capital assets Leases are classified as capital or operating leases. Leases which transfer substantially all of the benefits and risks incidental to ownership of property are accounted for as capital leases. All other leases are accounted for as operating leases and the related lease payments are charged to expenses as incurred. - 8 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) vi) Inventories of supplies Inventories of supplies held for consumption are recorded at the lower of cost and replacement cost. Investment Income Investment income is reported as revenue in the period earned. When required by funding government or related Act, investment income earned on deferred revenue is added to the investment and forms part of the deferred revenue balance. Tax Revenues In 2013, the Municipality received $3,225,715 (2012 - $3,113,710) in property tax revenues for municipal purposes. The authority to levy and collect property taxes is established under the Municipal Act 2001, the Assessment Act, the Education Act, and other legislation. The amount of the total annual property tax levy is determined each year through Council's approval of the annual budget. Municipal tax rates are set annually by Council for each class or type of property, in accordance with legislation and Council-approved policies, in order to raise the revenue required to meet operating budget requirements. Education tax rates are established by the Province each year in order to fund costs of education on a Province-wide basis. Taxation revenues are recorded at the time billings are issued. Additional property tax revenue can be added throughout the year, related to new properties that become occupied, or that become subject to property tax, after the return of the annual assessment roll used for billing purposes. The Municipality may receive supplementary assessment rolls over the course of the year from MPAC that identify new or omitted assessments. Property taxes for these supplementary/omitted amounts are then billed according to the approved tax rate for the property class. Taxation revenues in any year may also be reduced as a result of reductions in assessment value rising from assessment and/or tax appeals. Each year, an amount is identified to cover the estimated amount of revenue loss attributable to assessment appeals, tax appeals or other deficiencies in tax revenue (e.g. uncollectible amounts, write-offs, etc.). Employee Benefit Plans The Municipality accounts for its participation in the Ontario Municipal Employees Retirement System (OMERS), a multi-employer public sector pension fund, as a defined contribution plan. The OMERS plan specifies the retirement benefits to be received by the employees based on the length of service and pay rates. Employee benefits include post employment benefits. Post employment benefits are subject to actuarial valuations and are accrued in accordance with the projected benefit method, prorated on service and management's best estimate of salary escalation and retirement ages of employees. Any actuarial gains and losses related to past service of employees are amortized over the expected average remaining service period. - 9 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Financial Instruments The Municipality's financial instruments consist of cash and cash equivalents, accounts receivable, taxes receivable, accounts payable and accrued liabilities and long-term liabilities. Unless otherwise noted, it is management's opinion that the Corporation is not exposed to significant interest, currency, or credit risk arising from these financial instruments. 2. INVESTMENTS Investments are comprised of the following: 2013 2012 $ $ $ Cost Market Cost Market One fund pooled bond securities 3,089,815 3,004,107 2,997,972 2,970,321 3. TAXES RECEIVABLE 2013 2012 $ $ Taxes receivable 764,910 659,404 Penalties and interest 56,675 126,437 821,585 785,841 - 10 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 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: 2013 2012 $ $ Total long-term liabilities incurred by the municipality, including those incurred on behalf of benefiting landowner 1,105,855 1,193,887 Principal repayments are summarized as follows: 2014 2015 2016 2017 2018 Beyond Total Recoverable From $ $ $ $ $ $ $ General tax revenue 41,331 42,816 44,353 546,602 - - 675,102 Benefiting landowners 50,302 52.340 54.473 56,681 58,987 157.970 430.753 91.633 95.156 98.826 603.283 58.987 157.970 1.105.855 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 2013 amounted to $43,256 (2012 - $21,325). - 11 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 5. OPERATION OF SCHOOL BOARDS AND THE COUNTY OF ELGIN During 2013, 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 1,404,114 3,062,486 Share of payments in lieu of taxes 6 61,264 Amounts requisitioned 1.404,120 3,123,750 6. TANGIBLE CAPITAL ASSETS Net Book Value 2013 2012 $ $ General Land 922,095 916,444 Buildings 2,056,238 2,144,464 Vehicles 1,225,237 932,350 Machinery and equipment 651,116 702,716 Land improvements 566,140 608,475 Infrastructure Plants and facilities 3,950,947 4,114,309 Roads 26,592,159 27,054,568 Underground and other networks 16,694,307 16,789,018 Machinery and equipment 1,189,920 1,249,358 53,848,159 54,511,702 Assets under construction 726,255 378,609 54,574,414 54,890,311 For additional information, see the Consolidated Schedule of Tangible Capital Assets (Page 21). During the year there were no write-downs of assets (2012 - $nil). In addition, roads and underground networks contributed to the Municipality totaled $nil (2012 - $349,442) and were capitalized at their fair value at the time of receipt. - 12 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 7. ACCUMULATED SURPLUS The accumulated surplus balance is comprised of current fund, capital fund, balances in reserves and discretionary reserve funds, unfunded liabilities to be recovered in the future and investment in tangible capital assets. Operating fund: Municipality - - Cemetery boards 180,248 170,647 Benefiting landowners (79,723) (63,848) 100,525 106,799 Invested in tangible capital assets 54,574,414 54,890,311 Capital fund (437,522) (256,915) Reserves 4,179,291 3,916,894 Reserve funds 1,762,616 1,429,053 60,179,324 60,086,142 AMOUNTS TO BE RECOVERED Net long-term debt (1,105,855) (1,193,887) ACCUMULATED SURPLUS 59,073,469 58,892,255 RESERVES AND RESERVE FUNDS CONSIST OF THE FOLLOWING: Reserves set aside for specific purposes by Council: - for working capital 435,000 425,000 - for capital purposes 1,112,706 1,102,937 - for waterworks purposes 1,152,232 989,458 - for rate stabilization 560,000 645,000 - for other purposes 919,353 754,499 Total reserves 4,179,291 3,916,894 Reserve funds set aside for specific purposes by Council: - for water system 96,160 97,697 - for construction of sanitary sewers 1,430,803 1,139,489 - for recreation and cultural service purposes 235,653 191,867 Total reserve funds 1,762,616 1,429,053 - 13 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 8. TRUST FUNDS Trust funds administered by the Municipality amounting to $233,729 (2012 - $232,229) have not been included in the Consolidated Balance Sheet nor have their operations been included in the Consolidated Statement of Operations. 9. DEFERRED REVENUE - OBLIGATORY RESERVE FUNDS A requirement of the public sector accounting principles of the Canadian Institute of Chartered Professional 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: 2013 2012 S $ Development charges 25,545 28,865 Gasoline tax 57,783 81,979 Parkland 64,334 51,756 147,662 162,600 10. PENSION AGREEMENTS The Municipality makes contributions to the Ontario Municipal Employees Retirement Fund (OMERS), which is a multi-employer plan, on behalf of approximately 22 members of its staff. The plan is a defined benefit plan which specifies the amount of the retirement benefit to be received by the employees based on the length of service and rates of pay. The amount contributed to OMERS for 2013 was $133,257 (2012 - $116,905). - 14 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 11. BUDGET FIGURES The operating budget approved by the council of the Municipality for 2013 is reflected on the consolidated statement of operations. Budget figures have been reclassified for the purposes of these financial statements to comply with PSAB reporting requirements. These adjustments include reserve transfers, capital expenditures, amortization and debt financing and repayment. Approved PSAB Budget Adjustments Budget $ $ $ REVENUES Property taxation 3,101,357 - 3,101,357 Taxation from other governments 63,588 - 63,588 User charges 1,527,687 - 1,527,687 Transfer payments Federal 13,600 277,900 291,500 Provincial 1,171,200 75,000 1,246,200 Other municipalities 431,400 - 431,400 Investment income 70,000 - 70,000 Penalties and interest on taxes 96,000 - 96,000 Recoveries from benefiting landowners 126,747 - 126,747 Other 13,700 - 13,700 Reserve transfers 194,700 (194,700) - Capital 1,568,290 (1.568.290) - Total Revenues 8,378,269 (1,410,090) 6,968,179 EXPENSES General government 725,163 14,126 739,289 Protection to persons and property 1,360,624 134,920 1,495,544 Transportation services 1,568,917 803,875 2,372,792 Environmental services 1,821,419 (7,837) 1,813,582 Health services 15,500 257 15,757 Social and family services 15,100 - 15,100 Recreation and cultural services 315,310 7,611 322,921 Planning and development 186,946 27,528 214,474 Capital 2,369,290 (2,369,290) - Total Expenses 8,378,269 (1,388,810) 6,989,459 BUDGETED ANNUAL SURPLUS - (21,280) (21,280) - 15 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 12. CONTINGENT LIABILITIES As at December 31, 2013 certain legal actions are pending against the municipality. The Municipality has guaranteed the debt of the Elgin Military Museum for an amount of $6,000,000. An estimate of loss on any contingency cannot be made since the outcome of these matters is indeterminate at this time. The Municipality has set up approximately $26,000 (2012 - $8,000) in accounts receivable for fees paid by the Municipality for this letter of guarantee. No funds have been collected for these guarantee fees. 13. PUBLIC SECTOR SALARY DISCLOSURE In 2013, no employees were paid a salary, as defined in the Public Sector Salary Disclosure Act, 1996, of$100,000 or more by the Municipality. 14. SUPPLEMENTARY INFORMATION: 2013 2012 $ $ [a] Current fund expenses by object: Salaries, wages and employees benefits 1,958,740 1,911,644 Long-term debt interest 43,256 21,325 Materials 2,116,921 2,313,317 Contracted services 1,897,745 1,748,052 Rents and financial expenses - 2,685 Amortization expense 1,494,264 1,496,007 Loss (gain) on disposal and transfer of assets (8,485) 31,012 External transfers to others 46,742 75,761 7,549,183 7,599,803 [b] Cash flow information: (Increase) decrease in taxes receivable (35,744) 21,302 (Increase) decrease in accounts receivable 162,140 (98,075) (Increase) decrease in inventories and prepaid expenses (789) 1,086 Increase (decrease) in accounts payable and accrued liabilities (61,254) 118,027 Increase (decrease) in deferred revenue-obligatory reserve funds (14,938) (201,429) 49,415 (159,089) - 16 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Notes to the Consolidated Financial Statements Year Ended December 31, 2013 15. SEGMENTED INFORMATION The Municipality is a diversified municipal government institution that provides a wide range of services to its citizens, including fire, roads, sewer and water. For management reporting purposes the Government's operations and activities are organized and reported by Fund. Funds were created for the purpose of recording specific activities to attain certain objectives in accordance with special regulations, restrictions or limitations. Municipal services are provided by departments and their activities are reported in these funds. Certain departments that have been separately disclosed in the segmented information, along with the services they provided, are as follows. Public Works The Public Works department is responsible for the delivery of municipal public works services related to the planning, development and maintenance of roadway systems, the maintenance of parking and open space, and street lighting. The Water and Waste Funds The water and wastewater department provides drinking water to citizens of the municipality, as well as, collection and treatment of wastewater. This department is responsible for the operation and maintenance of both systems in accordance with government regulations under the Safe Drinking Water Act and other pieces of legislation. Other segments This segment includes the remaining departments and activities of the Municipality. Some of the larger activities in this segment include general government, fire, police, public health services, recreation and cultural services, planning and development and solid waste collection and disposal. For each reported segment, revenues and expenses represent both amounts that are directly attributable to the segment and amounts that are allocated on a reasonable basis. Therefore, certain allocation methodologies are employed in the preparation of segmented financial information. The General Revenue Fund reports on municipal services that are funded primarily by taxation such as property and business tax revenues. Taxation and payments-in-lieu of taxes are apportioned to General Revenue Fund services based on the Fund's net surplus. Certain government transfers, transfer from other funds, and other revenues have been apportioned based on a percentage of budgeted expenses. The accounting policies used in these segments are consistent with those followed in the preparation of the consolidated financial statements as disclosed in Note 1. For additional information see the Consolidated Schedule of Segment Disclosure and Schedule of Segment Disclosure. - 17 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Segment Disclosure Year Ended December 31, 2013 Water and Public Other Total Waste Funds Works Segments Consolidated $ $ $ $ REVENUE Taxation - 1,568,917 1,656,798 3,225,715 Sales of service and regulatory fees 1,394,651 32,221 330,657 1,757,529 Government transfer 38,843 435,405 1,726,966 2,201,214 Other 191.635 - 354,304 545,939 1,625,129 2,036,543 4.068,725 7,730 397 EXPENSES Salaries, wages and employee benefits 268,926 682,425 1,007,389 1,958,740 Long-term debt interest 18,154 - 25,102 43,256 Materials 464,858 1,079,500 572,563 2,116,921 Contracted services 223,003 47,853 1,626,889 1,897,745 Amortization 463,626 803,875 226,763 1,494,264 Loss (gain) on disposal and transfer of assets - (8,485) - (8,485) Transfer to others - - 46,742 46,742 1.438,567 2,605,168 3.505,448 7,549,183 ANNUAL SURPLUS (DEFICIT) 186,562 (568,625) 563,277 181,214 - 18 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Segment Disclosure Year Ended December 31, 2012 Water and Public Other Total Waste Funds Works Segments Consolidated $ $ $ $ REVENUE Taxation - 1,096,483 2,017,227 3,113,710 Sales of service and regulatory fees 1,429,785 24,362 334,025 1,788,172 Government transfer 133,776 518,346 1,840,417 2,492,539 Other 437,616 - 315,911 753,527 2,001,177 1.639,191 4.507.580 8,147,948 EXPENSES Salaries, wages and employee benefits 276,927 602,503 1,032,214 1,911,644 Long-term debt interest 21,140 - 185 21,325 Materials 610,036 1,148,552 554,729 2,313,317 Contracted services 143,883 23,849 1,583,005 1,750,737 Amortization 461,478 829,594 204,935 1,496,007 Loss on transfer and disposal of assets - 31,012 - 31,012 Transfer to others - - 75,761 75,761 1,513,464 2,635,510 3,450,829 7,599,803 ANNUAL SURPLUS (DEFICIT) 487,713 (996,319) 1,056,751 548,145 - 19 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Schedule of Segment Disclosure Year Ended December 31, 2013 Budget Actual Actual WATER AND WASTE WATER 2013 2013 2012 $ $ $ Revenue Sales of services and regulatory fees 1,201,089 1,394,651 1,429,785 Government transfers 38,843 38,843 133,776 Benefiting land owners 126,747 178,118 414,232 Other 16,858 13,517 23,384 Total Revenues 1,383,537 1,625,129 2,001,177 Expenses Salaries, wages and employees benefits 279,361 268,926 276,927 Long-term debt interest 12,620 18,154 21,140 Materials 616,511 464,858 610,036 Contracted services, rents and financial expenses 32,701 223,003 143,883 Amortization - 463,626 461,478 Total Expenditures 941,193 1,438,567 1,513,464 Annual Surplus 442,344 186.562 487,713 Budget Actual Actual PUBLIC WORKS 2013 2013 2012 $ $ $ Revenue Taxation 1,568,917 1,568,917 1,096,483 Sales of services and regulatory fees 8,600 32,221 24,362 Government transfers 430,000 435,405 518,346 Total Revenues 2,007,517 2,036,543 1,639,191 Expenses Salaries, wages and employees benefits 624,792 682,425 602,503 Materials 916,125 1,079,500 1,148,552 Contracted services and rents 28,000 47,853 23,849 Amortization - 803,875 829,594 Loss (gain) on transfer and disposal of assets - (8,485) 31,012 Total Expenditures 1,568,917 2,605,168 2,635,510 Annual (Deficit) 438,600 (568,625) (996,319) - 20 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Tangible Capital Assets Year Ended December 31, 2013 Opening Ending Opening Ending Ending Historical Historical Accumulated Accumulated Net Cost Cost Amortization Amortization Book Balance 2013 2013 2013 Balance Balance 2013 2013 2013 Balance Value Jan 1/2013 Acquisitions Disposals Write-Offs Dec 31/2013 Jan 1/2013 Disposals Amortization Write-Offs Dec 31/2013 Dec 31/2013 ASSET TYPE Infrastructure Related Land 187,256 - - - 187,256 - - - - - 187,256 Buildings/Building Improvements 5,727,857 1,102 - - 5,728,959 1,800,804 - 164,464 - 1,965,268 3,763,691 Machinery and Equipment 2,653,659 79,719 246,089 2,487,289 1,404,301 222,638 115,706 - 1,297,369 1,189,920 Linear-Roadways 38,587,397 266,132 - - 38,853,529 11,532,829 - 728,541 - 12,261,370 26,592,159 Linear-Sewer and Water Services 20,431,701 143,875 - - 20,575,576 3,642,683 - 238,586 - 3,881,269 16,694,307 Infrastructure Related Total 67,587,870 490,828 246,089 - 67,832,609 18,380,617 222,638 1,247,297 - 19,405,276 48,427,333 General Capital Land 916,444 5,651 - - 922,095 - - - - - 922,095 Land Improvements 997,057 - - - 997,057 388,582 - 42,335 - 430,917 566,140 Building/Building Improvements 3,598,098 - - - 3,598,098 1,453,634 - 88,226 - 1,541,860 2,056,238 Machinery and Equipment 954,132 - - - 954,132 251,416 - 51,600 - 303,016 651,116 Vehicle 1,449,607 361,287 24,680 - 1,786,214 517,257 21,086 64,806 - 560,977 1,225,237 General Capital Total 7,915,338 366,938 24,680 - 8,257,596 2,610,889 21,086 246,967 - 2,836,770 5,420,826 Total Capital Assets Sub-Total 75,503,208 857,766 270,769 - 76,090,205 20,991,506 243,724 1,494,264 - 22,242,046 53,848,159 Work In Progress 378,609 524,790 177,144 - 726,255 - - - - - 726,255 Total Tangible Capital Assets 75,881,817 1,382,556 447,913 - 76,816,460 20,991,506 243,724 1,494,264 - 22,242,046 54,574,414 -21 - THE CORPORATION OF THE MUNICIPALITY OF BAYHAM Consolidated Schedule of Tangible Capital Assets Year-ended December 31, 2012 Opening Ending Opening Ending Ending Historical Historical Accumulated Accumulated Net Cost Cost Amortization Amortization Book Balance 2012 2012 2012 Balance Balance 2012 2012 2012 Balance Value Jan 1/2012 Acquisitions Disposals Write-Offs Dec 31/2012 Jan 1/2012 Disposals Amortization Write-Offs Dec 31/2012 Dec 31/2012 ASSET TYPE Infrastructure Related Land 187,256 - - - 187,256 - - - - - 187,256 Buildings/Building Improvements 5,727,328 529 - - 5,727,857 1,636,226 - 164,578 - 1,800,804 3,927,053 Machinery and Equipment 2,590,051 63,836 228 - 2,653,659 1,288,403 228 116,126 - 1,404,301 1,249,358 Linear-Roadways 38,564,647 22,750 - - 38,587,397 10,794,281 - 738,548 - 11,532,829 27,054,568 Linear-Seward and Water Services 20,193,490 238,211 - - 20,431,701 3,405,510 - 237,173 - 3,642,683 16,789,018 Infrastructure Related Total 67,262,772 325,326 228 - 67,587,870 17,124,420 228 1,256,425 - 18,380,617 49,207,253 General Capital Land 916,444 - - - 916,444 - - - - - 916,444 Land Improvements 991,705 5,352 - - 997,057 345,738 - 42,844 - 388,582 608,475 Buildings/Building Improvements 2,344,355 1,253,743 - - 3,598,098 1,386,700 - 66,934 - 1,453,634 2,144,464 Machinery and Equipment 826,368 127,764 - - 954,132 200,706 - 50,710 - 251,416 702,716 Vehicle 1,363,946 223,531 137,870 - 1,449,607 527,519 89,357 79,095 - 517,257 932,350 General Capital Total 6,442,818 1,610,390 137,870 - 7,91.5,338 2,460,663 89,357 239,_583 - 2,610,889 5,304,449 Total Capital Assets Sub-Total 73,705,590 1,935,716 138,098 - 75,503,208 19,585,083 89,585 1,496,008 - 20,991,506 54,511,702 Work In Progress 661,965 373,163 656,519 - 378,609 - - - - - 378,609 Total Tangible Capital Assets 74,367,555 2,308,879 794,617 - 75,881,817 19,585,083 89,585 1,496,008 - 20,991,506 54,890,311 -22 -