HomeMy WebLinkAboutFinancial Statements 2006 THE CORPORATION OF THE
MUNICIPALITY OF BAYHAM
Consolidated Financial Statements
December 31, 2006
THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Financial Statements
Year Ended December 31, 2006
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
William A.Graham*
John M.Scott*
Alan R.Enns*
Michael S.Stover*
E N N S I I P Robert B.Foster*
•CHARTERED ACCOUNTANTS Betty A.Gropp
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 consolidated balance sheet of The Corporation of the Municipality of Bayham as
at December 31, 2006 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, 2006 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,ra/tamSCo�` Ewa 47,
March 28, 2007 CHARTERED ACCOUNTANTS
Licensed Public Accountants
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Statement of Financial Position
As At December 31, 2006
2006 2005
$ $
ASSETS
Financial Assets
Cash and short term deposits 1,915,863 1,761,577
Taxes receivable 604,982 544,774
Accounts receivable 382,668 328,272
Other current assets 27,284 27,353
TOTAL ASSETS 2,930,797 2,661,976
LIABILITIES
Liabilities
Deferred revenue - obligatory reserve funds (note 7) 208,492 123,211
Accounts payable and accrued liabilities 340,878 440,548
Net long-term liabilities (note 4) 1,042,835 1,200,164
1,592,205 1,763,923
MUNICIPAL POSITION
FUND BALANCES (NOTE 5)
Current fund(page 11) (22,500) 138,628
Capital fund(page 12) 53,583 46,030
Reserves (page 13) 1,838,922 1,423,583
Reserve funds (page 13) 511.422 489,976
2,381,427 2,098,217
AMOUNTS TO BE RECOVERED
From future revenues (1,042,835) (1,200,164)
TOTAL MUNICIPAL POSITION 1,338,592 898,053
TOTAL LIABILITIES AND MUNICIPAL POSITION 2,930,797 2,661,976
See accompanying notes to the consolidated financial statements.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Statement of Financial Activities
Year Ended December 31, 2006
2006 2005
$ $
REVENUES
Property taxation 2,304,826 2,092,713
Taxation from other governments 45,992 45,924
User charges 1,095,548 1,189,298
Government grants 1,975,134 2,143,771
Investment income 67,316 53,979
Penalties and interest on taxes 70,737 77,056
Recoveries from benefiting landowners 232,497 240,788
Other 7,629 6,725
Total Revenues 5,799,679 5,850,254
EXPENDITURES
Current
General government 551,651 464,996
Protection to persons and property 1,014,586 1,011,725
Transportation services 1,077,870 1,174,188
Environmental services 1,114,066 1,040,446
Health services 49,114 39,533
Social and family services 7,650 4,495
Recreation and cultural services 266,578 220,555
Planning and development 240,047 136,553
Total current expenditures 4,321,562 4,092,491
Capital
General government 8,830 32,547
Protection to persons and property 62,706 238,636
Transportation services 736,618 489,454
Environmental services 81,086 157,625
Health services 7,042 -
Recreation and cultural services 141,296 93,176
Planning and development - 13,401
Total capital expenditures 1,037,578 1,024,839
Total Expenditures 5,359,140 5,117,330
NET REVENUES/(EXPENDITURES) 440,539 732,924
Decrease in amounts to be recovered (157,329) (157,662)
CHANGE IN FUND BALANCES 283,210 575,262
See accompanying notes to the consolidated financial statements.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Statement of Changes in Financial Position
Year Ended December 31, 2006
2006 2005
$ $
OPERATIONS
Net revenues 440,539 732,924
Uses:
Increase in taxes receivable (60,208) (658)
Increase in accounts receivable (54,396) (39,529)
Increase in other current assets - (13,783)
Decrease in accounts payable and accrued liabilities (99,670) -
(214,274) (53,970)
Sources:
Decrease in other current assets 69 -
Increase in accounts payable and accrued liabilities - 124,189
Increase in deferred revenue - obligatory reserve funds 85,281 51,217
85,350 175,406
Net change in cash from operations 311.615 854,360
FINANCING
Long-term debt repayment (157,329) (157,662)
Net change in cash from financing (157,329) (157,662)
NET CHANGE IN CASH AND CASH EQUIVALENTS 154,286 696,698
OPENING CASH AND CASH EQUIVALENTS 1,761,577 1,064,879
CLOSING CASH AND CASH EQUIVALENTS 1,915,863 1,761,577
See accompanying notes to the consolidated financial statements.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Notes to the Consolidated Financial Statements
Year Ended December 31, 2006
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.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Notes to the Consolidated Financial Statements
Year Ended December 31, 2006
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 $87,974 in the current year (2005 - $83,896) 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.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Notes to the Consolidated Financial Statements
Year Ended December 31, 2006
3. OPERATION OF SCHOOL BOARDS AND THE COUNTY OF ELGIN
During 2006, 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 1,299,376 1,987,446
Share of payments in lieu of taxes - 30,485
Amounts requisitioned 1,299,376 2,017,931
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:
2006 2005
$ $
Total long-term liabilities incurred by the municipality,
including those incurred on behalf of benefiting landowner 1,042,835 1,200,164
Principal repayments are summarized as follows:
2007 2008 2009 2010 2011 Beyond Total
Recoverable From $ $
General tax revenue - - - - - -
Benefiting landowners 167,334 177,198 184,386 196,162 208.690 109,065 1,042,835
167,334 177,198 184,386 196,162 208,690 109,065 1,042,835
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Notes to the Consolidated Financial Statements
Year Ended December 31, 2006
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 2006 amounted to $73,047 (2005 - $83,172)
5. MUNICIPAL FUND BALANCES AT THE END OF THE YEAR
The Municipality's fund balances are comprised of the following:
2006 2005
$ $
For general reduction of taxation:
Municipality 11,280 81,000
Cemetery boards 76,398 80,560
Benefiting landowners (110,178) (22,932)
(22,500) 138,628
For acquisition of fixed assets 53,583 46,030
Reserves 1,838,922 1,423,583
Reserve funds 511.422 489,976
2,381,427 2,098,217
6. TRUST FUNDS
Trust funds administered by the municipality amounting to $198,963 (2005 - $196,036) have not been
included in the Consolidated Balance Sheet nor have their operations been included in the
Consolidated Statement of Operations.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Notes to the Consolidated Financial Statements
Year Ended December 31, 2006
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:
2006 2005
$ $
Development Charges 10,646 10,110
Gasoline tax 124,308 62,155
Parkland 73,538 50,946
208,492 123,211
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, 2006 indicates the following:
Outstanding
Contractual Accumulated 2006 Debt Long-term
Obligation Surplus Charges Liabilities
Primary Water
Supply System City of London 88,426 7,405 62,238
The operating surplus and long-term liabilities indicated above are not reflected in the accompanying
financial statements.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Notes to the Consolidated Financial Statements
Year Ended December 31, 2006
9. BUDGET FIGURES
The Council of the Municipality of Bayham completes separate budget reviews for its operating and
capital funds each year. The approved 2006 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 2006, Council approved transfers totaling $138,080 (2005 - $334,477) 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 2006, 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.
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Schedule of Current Fund Operations
Year Ended December 31, 2006
Unaudited Budget
2006 2006 2005
$ $ $
REVENUES
Property taxation 2,265,212 2,304,826 2,092,713
Taxation from other governments 45,992 45,992 45,924
User charges 1,016,811 1,033,149 1,159,243
Government grants 1,808,785 1,635,501 2,027,131
Investment income 40,467 64,784 30,474
Penalties and interest on taxes 69,000 70,737 77,056
Recoveries from benefiting landowners 228,571 228,571 215,166
Other 2,000 3.176 6,725
Total Revenues 5,476,838 5,386,736 5,654,432
EXPENDITURES
General government 523,329 551,651 464,996
Protection to persons and property 1,184,418 1,014,586 1,011,725
Transportation services 1,213,045 1,077,870 1,174,188
Environmental services 1,077,758 1,114,066 1,040,446
Health services 26,824 49,114 39,533
Social and family services 7,500 7,650 4,495
Recreation and cultural services 288,528 266,578 220,555
Planning and development 155,723 240.047 136,553
Total Expenditures 4,477,125 4,321,562 4,092,491
NET REVENUES/(EXPENDITURES) 999,713 1,065,174 1,561,941
FINANCING AND TRANSFERS
Transfers to reserves and reserve funds (140,748) (344,835) (569,172)
Transfers to capital fund (704,120) (724,138) (711,142)
Debt principal repayment (154,845) (157,329) (160,693)
Net financing and transfers (999,713) (1,226,302) (1,441,007)
CHANGE IN CURRENT FUND BALANCE - (161,128) 120,934
OPENING CURRENT FUND BALANCE - 138,628 17,694
CLOSING CURRENT FUND BALANCE - (22,500) 138,628
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Schedule of Capital Fund Operations
Year Ended December 31, 2006
Unaudited Budget
2006 2006 2005
$ $ $
REVENUES
Government grants 305,919 339,633 116,640
Sale of assets - 4,453 -
Benefiting landowners - 3,926 25,622
Other 95,575 62,399 30,055
Total Revenues 401,494 410,411 172,317
EXPENDITURES
General government 12,608 8,830 32,547
Protection to persons and property 71,056 62,706 238,636
Transportation services 878,557 736,618 489,454
Environmental services 162,501 81,086 157,625
Health services 20,000 7,042 -
Recreation and cultural services 143,802 141,296 93,176
Planning and development 1,200 - 13,401
Total Expenditures 1,289,724 1,037,578 1,024,839
NET REVENUES/(EXPENDITURES) (888,230) (627,167) (852,522)
FINANCING AND TRANSFERS
Net transfers from (to) reserves and reserve funds 138,080 (89,418) (9,104)
Transfers from operating fund 704,120 724,138 711,142
Proceeds of long term debt - - 3,031
Net financing and transfers 842,200 634,720 705,069
CHANGE IN CAPITAL FUND BALANCE (46,030) 7,553 (147,453)
OPENING CAPITAL FUND BALANCE 46,030 46,030 193,483
CLOSING CAPITAL FUND BALANCE - 53,583 46,030
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THE CORPORATION OF THE MUNICIPALITY OF BAYHAM
Consolidated Schedule of Reserves and Reserve Funds
Year Ended December 31, 2006
2006 2005
$ $
REVENUES
Investment income 2,532 23,505
Net revenues 2,532 23,505
FINANCING AND TRANSFERS
Net transfers from (to) capital fund 89,418 9,104
Net transfers from (to) current fund 344,835 569,172
Net transfers 434,253 578,276
CHANGE IN RESERVE AND RESERVE FUND BALANCES 436,785 601,781
OPENING RESERVE AND RESERVE FUND BALANCE 1,913,559 1,311,778
CLOSING RESERVE AND RESERVE FUND BALANCE 2,350,344 1,913,559
ANALYZED AS FOLLOWS:
Reserves set aside for specific purposes by Council:
- for working capital 364,153 354,153
- for capital purposes 545,009 265,819
- for waterworks purposes (58,950) (3,291)
- for rate stabilization 611,670 582,002
- for other purposes 377,040 224,900
Total reserves 1,838,922 1,423,583
Reserve funds set aside for specific purposes by Council:
- for construction of sanitary sewers 429,878 416,249
- for recreation and cultural service purposes 75,123 67,553
- for other purposes 6.421 6,174
Total reserve funds 511.422 489,976
TOTAL RESERVES AND RESERVE FUNDS 2,350,344 1,913,559
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