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HomeMy WebLinkAboutFinancial Statements 1997 P)a-P t)° et-L- RC1 The Corporation of the Village of Port Burwell Financial Statements December 31, 1997 Contents Pace Auditor's Report 1 Consolidated Balance Sheet 2 Consolidated Statement of Operations 3-4 Notes to the Financial Statements 5-9 Brian M. I. Budarick, Chartered Accountant Box 252,Tillsonburg,Ontario N4G 4H5 Tel/Fax(519)842-6696 Port Rowan(519)586-2700 e-mail: bbudarik@oxford.net Auditor's Report To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Village of Port Burwell I have audited the consolidated balance sheet of The Corporation of the Village of Port Burwell as at December 31, 1997 and the consolidated statement of operations for the year then ended. These consolidated financial statements are the responsibility of the corporation's management. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I 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 my opinion, these consolidated financial statements present fairly, in all material respects, the financial position of the corporation as at December 31, 1997 and the results of its operations and the changes in its financial position for the year then ended in accordance with the accounting principles disclosed in note 2 to the financial statements. ^Y ;6Z h ( ZOCr; s- jU Tillsonburg, Ontario Chartered Accountant March 16, 1998 License Number 15898 1 The Corporation of the Village of Port Burwell Consolidated Balance Sheet December 31 1997 1996 Assets Unrestricted Cash $ - $ 53,227 Taxes receivable 16,640 17,659 User charges receivable 48,869 54,782 Accounts receivable 20,720 86,156 Prepaid expenses 330 6,504 Mortgage receivable - 34,125 86,559 252,453 Restricted Cash 73,998 29,350 Capital outlay financed by long term liabilities and to be recovered in future years (note 2) 530,368, 418,856 $ 690,925 $ 700,659 Liabilities Current liabilities Bank indebtedness $ 17,613 $ - Temporary loan 120,000 155,000 Accounts payable and accrued liabilities 138,163 106,956 275,776 261,956 Net long term liabilities (note 6) 530,368 418,856 Fund Balances at the end of the year To be used to offset (be recovered from) taxation or user charges (note 7) (268,073) (43,810) Unexpended capital financing (notes 7 and 12) 24,549 - Capital operations not yet permanently financed (note 7) - (20,000) Reserves (note 8) 54,307 54,307 Reserve funds (note 8) 73,998 29,350 $ 690,925 $ 700,659 Contingency and commitments (notes 10, 11 and 12) The accompanying notes are an integral part of these financial statements. 2 The Corporation of the Village of Port Burwell Consolidated Statement of Operations Unaudited Audited Audited Budget Actual Actual Years Ended December 31 1997 1997 1996 SOURCES OF FINANCING: Taxation and user charges Residential and farm taxation $ 474,455 $ 473,413 $ 466,914 Commercial and industrial taxation 71,667 69,297 61,665 Business taxation 18,302 18,302 17,866 Taxation from other governments 14,281 14,272 17,330 Water and sewer billings 250,400 254,737 249,705 User charges 64,727 93,626 80,694 893,832 923,647 894,174 Grants Province of Ontario 160,577 158,762 219,582 Government of Canada 13,254 3,160 19,751 Other municipalities - - 8,817 173,831 161,922 248,150 Other Sale of land 90,000 15,000 - Penalties on taxes 2,500 2,947 2,283 Investment income 1,500 1,953 3,285 Donations 4,000 3,300 52,300 98,000 23,200 57,868 Deduct Amounts for county and school boards (332,558) (339,266) (329,223) Proceeds from the issue of long term liabilities 251,115 172,442 183,641 Total sources of financing 1,084,220 941,945 1,054,610 MUNICIPAL FUND BALANCES AT THE BEGINNING OF THE YEAR(note 7) To be used to offset (to be recovered from) taxation or user charges (43,810) (43,810) 310 Capital operations not yet permanently financed (20,000) (20,000) - Total financing available during the year $ 1,020,410 $ 878,135 $ 1,054,920 The accompanying notes are an integral part of these financial statements. 3 The Corporation of the Village of Port Burwell Consolidated Statement of Operations Unaudited Audited Audited Budget Actual Actual Years Ended December 31 1997 1997 1996 APPLIED TO: Current operations General government $ 270,695 $ 447,044 $ 323,661 Harbour 2,000 4,740 29,782 Fire protection 36,500 32,619 24,104 Other protection 33,820 34,905 27,147 Transportation services 92,660 112,011 104,478 Sanitary sewers 124,115 141,735 162,355 Waterworks system 87,698 71,710 88,871 Garbage collection 62,300 58,598 56,245 Recreation and cultural services 17,800 19,414 22,957 Planning and development 18,000 17,429 15,281 745,588 940,205 854,881 Capital General government 51,487 42,331 86,080 Harbour - 3,581 8,656 Protection to persons and property 60,695 28,256 7,664 Transportation services 106,440 56,304 111,336 Water and sewer systems 20,000 2,889 15,379 Recreation and cultural services - 3,619 72,696 238 622 136,980 301,811 Net appropriations to (from) reserves and reserve funds 36,200 44,474 (37,962) Total funds applied 1,020,410 1,121,659 1,118,730 MUNICIPAL FUND BALANCES AT THE END OF THE YEAR(note 7) To be used to offset (to be recovered from) taxation or user charges - (268,073) (43,810) Unexpended capital financing - 24,549 - Capital operations not yet permanently financed - - (20,000) Total applications during the year $ 1,020,410 $ 878,135 $ 1,054,920 The accompanying notes are an integral part of these financial statements. 4 The Corporation of the Village of Port Burwell Notes to the Financial Statements Year ended December 31, 1997 1. Ministry of Municipal Affairs and Housing restructuring order The Village of Port Burwell received a restructuring order from the Ministry of Municipal Affairs and Housing dated May 15, 1997 requiring the merger of operations for the Village of Port Burwell, the Village of Vienna and the Township of Bayham effective January 1, 1998. The new municipality operates under the name of The Corporation of the Municipality of Bayham. 2. Summary of significant accounting policies The consolidated financial statements of the Corporation of the Village of Port Burwell are the representation of management prepared in accordance with accounting policies prescribed for Ontario municipalities by the Ministry of Municipal Affairs. Since precise determination of many assets and liabilities is dependent upon future events, the preparation of periodic financial statements necessarily involves the use of estimates and approximations. These have been made using careful judgment. (a) Basis of Consolidation (i) These consolidated statements reflect the assets, liabilities, sources of financing and expenditures of the revenue fund, capital fund, reserve funds and reserves and include the activities of all committees of Council and Port Burwell Waterworks which is under the control of Council. All interfund assets, liabilities, sources of financing and expenditures have been eliminated with the exception of loans or advances between the reserve funds and any other fund of the municipality and the resulting interest income and expenditures. (ii) Non-consolidated entities There are no non-consolidated entities. (iii) Accounting for County and School Board Transactions The taxation, other revenue, expenditures, assets and liabilities with respect to the operations of the school boards and the County of Elgin, are not reflected in the municipal fund balances of these financial statements. Overlevies (underlevies) are reported on the Consolidated Balance Sheet as "other current liabilities" ("other current assets"). (iv) Trust funds and their related operations administered by the Village are not consolidated, but are reported separately on the "Trust Funds Statement of Continuity and Balance Sheet". (b) Basis of Accounting (i) Sources of financing and expenditures are reported on the accrual basis of accounting with the exception of principal and interest charges on long term liabilities which are charged against operations in the period in which they are paid. (ii) The accrual basis of accounting recognizes revenues as they become available and measurable; expenditures are recognized as they are incurred and measurable as a result of receipt of goods or services and the creation of a legal obligation to pay. 5 The Corporation of the Village of Port Burwell Notes to the Financial Statements Year ended December 31, 1997 2(b). Summary of significant accounting policies (continued) (iii) Capital Assets The historical cost and accumulated amortization for capital assets are not recorded for municipal purposes. Capital assets are reported as an expenditure on the Consolidated Statement of Operations in the year of acquisition. (iv) Capital Outlay to be Recovered in Future Years "Capital outlay to be recovered in future years," which represents the outstanding principal portion of unmatured long term liabilities for municipal expenditures is reported on the Consolidated Balance Sheet. 3. Operations of school boards and the County of Elgin Further to note 2(a)(iii), the taxation, other revenues, expenditures and overlevies (underlevies) of the school boards and the County of Elgin are comprised of the following: School Boards County Taxation and user charges $ 239,501 $ 99,765 Requisitions 239,501 99,765 Overlevies (underlevies), end of year $ - $ - 4. Trust funds Trust funds administered by the municipality amounting to $11,091 (1996 - $22,770) have not been included in the Consolidated Balance Sheet nor have their operations been included in the Consolidated Statement of Operations. 5. Pension agreement The municipality made contributions to the Ontario Municipal Employees Retirement Fund (OMERS), which is a multi-employer plan, on behalf of 4 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 1997 was $8,282 (1996 - $8,402) for current service and is included as an expenditure on the Consolidated Statement of Operations. At December 31, 1997, the municipality had no past service obligation to the plan. 6 The Corporation of the Village of Port Burwell Notes to the Financial Statements Year ended December 31, 1997 6. Net long term liabilities (a) The balance of net long term liabilities reported on the Consolidated Balance Sheet is made up of the following: 1997 1996 Total long term liabilities incurred by the municipality including those incurred on behalf of school boards, other municipalities and municipal enterprises and outstanding at the end of the year amount to $ 530,368 $ 418.856 (b) Of the net long term liabilities reported in (a) of this note, $312,725 in principal payments are payable from 1998 to 2002 and are recoverable from general municipal revenues. (c) Principal and interest payments pertaining to net long term liabilities reported in the Consolidated Statement of Operations were $60,930 and$24,958 respectively. 7. Municipal fund balances The balances on the Consolidated Statement of Operations of municipal equity (deficit) of $(243,524) (1996 - $(63,810)) at the end of the year are comprised of the following: 1997 1996 For general reduction (increase) of taxation $ (255,446) $ (39,364) For general reduction(increase) of user charges - Water 10,520 27,974 - Sewer (23,147) (32,420) (268,073) (43,810) Unexpended capital financing 24,549 - Acquisition of capital assets to be financed from taxation or user charges - (20,000) $ (243,524) $ (63,810) 7 The Corporation of the Village of Port Burwell Notes to the Financial Statements Year ended December 31, 1997 8. Reserves and reserve funds The total balance of reserves and reserve funds of$54,307 (1996 - $54,307) and $73,998 (1996 - $29,350) respectively are made up of the following: 1997 1996 Reserves set aside for specific purpose by Council For working capital $ 39,307 $ 39,307 For waterworks purposes 15,000 15,000 $ 54307 $ 54,307 Reserve funds set aside for specific purpose by Council For acquisition of fire truck $ 7,162 $ 7,132 For sewage treatment plant capital 8,656 13,548 For water system 49,474 For development purposes 6,176 6,150 For seawall repair 2,530 2,520 $ 73,998 $ 29,350 9. Contractual Obligation- Ontario Clean Water Agency In accordance with a service agreement entered into by the Village with the Ontario Clean Water Agency, the existing sewage and water systems are owned and operated by the Agency. The Village is obligated to meet all operating costs and repay the long term liabilities related to these projects. Included in the "Consolidated Statement of Operations" are the 1997 charges from the Agency for water of$2,427 and for sewage of$77,106. The "Consolidated Balance Sheet" does not reflect any assets or liabilities pertaining to the sewage or water systems except to the extent of service charges due to the Agency. Information received from the Agency as at December 31, 1997, indicates the following: Total Outstanding Accumulated 1997 Debt Long Term (Deficit) Charges Liabilities Water systems $ (12,703) $ 5.165 $ 44,424 The operating surplus and long term liabilities indicated above are not reflected in the accompanying consolidated financial statements. 8 The Corporation of the Village of Port Burwell Notes to the Financial Statements Year ended December 31, 1997 10. Contingency-termination of Village's Administrator/Clerk-Treasurer Although no legal claim has been filed, the prior Administrator/Clerk-Treasurer of the Village has alleged wrongful/constructive dismissal and other employment related issues. The Village has paid the Administrator/Clerk-Treasurer a severance amount equalling six month wages which is fully reflected in these financial statements. No provision has been made in the consolidated financial statements for the allegations by the prior Administrator/Clerk-Treasurer as the outcome is not yet determinable. 11. Commitment - lawn maintenance In 1997 the Village of Port Burwell entered into a three year contract to obtain lawn maintenance services at a cost of$ 19,800 plus GST per year. This contract was not included in the Village's 1997 budget and the Transition Board did not approve the contract prior to the Village committing to this agreement. 12. Commitment- fire hall renovation On December 9, 1997, The Village of Port Burwell signed an agreement for$ 34,000 to renovate the Port Burwell fire hall. At December 31, 1997,the Village had incurred costs in the amount of$ 8,180 with respect to this contract,which is reflected in the protection to persons and property capital account. Long term financing for the total project was received in December 1997. Funding in excess of costs incurred to December 31, 1997, in the amount of$ 24,549, has been recorded as unexpended capital financing. 9 The Village of Port Burwell OHRP Trust Fund Financial Statements December 31, 1997 Contents Page Auditor's Report 1 Statement of Continuity and Balance Sheet 2 Notes to the Financial Statements 3 Brian M. I. Budarick, Chartered Accountant Box 252,Tillsonburg,Ontario N4G 4H5 Tel/Fax(519)842-6696 Port Rowan(519)586-2700 e-mail: bbudarik@oxford.net Auditor's Report To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Village of Port Burwell I have audited the balance sheet of the OHRP Trust Fund of the Corporation of the Village of Port Burwell as at December 31, 1997 and the statement of continuity for the year then ended. These financial statements are the responsibility of the Village's management. My responsibility is to express an opinion on these financial statements based on my audit. I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I 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 my opinion, these financial statements present fairly, in all material respects, the financial position of the OHRP Trust Fund of the Corporation of the Village of Port Burwell as at December 31, 1997 and the results of its operations and the changes in financial position for the year then ended in accordance with generally accepted accounting principles disclosed in note 1 to the financial statements. /a r " dzZ Tillsonburg, Ontario Chartered Accountant March 16, 1998 License Number 15898 1 OHRP Trust Fund The Corporation of the Village of Port Burwell Statement of Continuity Years Ended December 31 1997 1996 Balance, beginning of year $ 21,700 $ 37,176 Capital Receipts Interest income - loans 632 615 Interest income - bank 84 474 716 1,089 Expenditures Repayment to Ministry of Housing 11,325 15,495 Village of Port Burwell administration fee 84 596 Payment of bank account interest to Village - 474 11,409 16,565 Deficiency revenue over expenditures (10,693) (15,476) Balance, end of year $ 11,007 $ 21,700 Balance Sheet December 31 1997 1996 Assets Cash $ 1,469 $ 12,768 Other assets (Note 2) Loans receivable - repayable 9,622 10,002 Loans receivable - forgivable - - $ 11,091 $ 22,770 Liability Administration fee and interest payable $ 84 $ 1,070 Fund Balance Balance, capital 11,007 21,700 $ 11,091 $ 22,770 The accompanying notes are an integral part of these financial statements. 2 OHRP Trust Fund The Corporation of the Village of Port Burwell Notes to the Financial Statements Year ended December 31, 1997 1. Summary of significant accounting policies These financial statements reflect the day to day operations of the OHRP Trust Fund, under administration by the Corporation of the Village of Port Burwell. The Trust Fund's receipts, disbursements, assets and liabilities are not included in the Village's consolidated financial statements. The financial statements of the OHRP Trust Fund are the representations of management prepared in accordance with accounting policies prescribed for Ontario municipalities by the Ministry of Housing. Since precise determination of many assets and liabilities is dependent upon future events, the preparation of periodic financial statements necessarily involves the use of estimates and approximations. These have been made using careful judgment. Basis of Accounting The accrual basis of accounting is used for the trust fund. 2. Ontario Home Renewal Program The Ontario Home Renewal Program (OHRP) 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 homes to local property standards. Individual loans are limited to $7,500 of which the maximum forgivable portion is $4,000. In July 1993, OHRP was discontinued by the Ontario Ministry of Housing. No further OHRP loans will be issued under the program and the balance in the OHRP bank trust account at the end of the year is to be returned to the Province. Homeowners who currently have OHRP loans will not be affected by the cancellation of the program. Ontario Home Renewal Program loans receivable at December 31, 1997 is comprised of repayable loans of $9,622 (1996 - $10,002) and no forgivable loans (1996 - 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 becomes due and payable by the homeowner. 3