Consolidated Financial Information of
THE CORPORATION OF THE
TOWN OF THE BLUE MOUNTAINS
Year ended December 31, 2012
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Consolidated Financial Information
Year ended December 31, 2012
The Corporation of the Town of The Blue Mountains Financial Statements
The Corporation of the Town of The Blue Mountains Trust Funds
Supplementary Financial Information
Museum Statement of Operations
Consolidated Entities
The Blue Mountains Public Library Board
Consolidated Financial Statements of
THE CORPORATION OF THE
TOWN OF THE BLUE MOUNTAINS
Year ended December 31, 2012
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Consolidated Financial Statements
Year ended December 31, 2012
Page
Consolidated Financial Statements
Independent Auditors’ Report.............................................................................................................
Consolidated Statement of Financial Position .................................................................................. 1
Consolidated Statement of Operations and Accumulated Surplus .................................................. 2
Consolidated Statement of Changes in Net Financial Assets .......................................................... 3
Consolidated Statement of Cash Flows ........................................................................................... 4
Summary of Significant Accounting Policies ................................................................................. 5-7
Notes to Consolidated Financial Statements .............................................................................. 8-23
Schedule of Deferred Revenue ...................................................................................................... 24
KPMG LLP
Chartered Accountants
115 King Street South, 2nd Floor
Waterloo ON N2J 5A3
Telephone
Fax
Internet
519-747-8800
519-747-8830
www.kpmg.ca
INDEPENDENT AUDITORS’ REPORT
To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Town of The Blue
Mountains:
We have audited the accompanying consolidated financial statements of The Corporation of the Town
of The Blue Mountains ("the Entity"), which comprise the consolidated financial position as at
December 31, 2012 and the consolidated statement of operations and accumulated surplus, changes
in net financial assets, and cash flows 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 consolidated financial
statements in accordance with Canadian public sector accounting standards, and for such internal
control as management determines is necessary to enable the preparation of consolidated 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 consolidated 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 an audit to
obtain reasonable assurance about whether the financial statements are free from 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 our 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, we consider 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.
KPMG LLP, is a Canadian limited liability partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity.
KPMG Canada provides services to KPMG LLP.
Page 2
Opinion
In our opinion, the consolidated financial statements present fairly, in all material respects, the
consolidated financial position of The Corporation of the Town of The Blue Mountains as at December
31, 2012, and its consolidated results of operations and the changes in its net debt and its
consolidated cash flows for the year then ended in accordance with Canadian public sector
accounting standards.
Comparative Information
The consolidated financial statements of The Corporation of the Town of The Blue Mountains as at
and for the year ended December 31, 2011 were audited by another auditor who expressed an
unmodified opinion on those statements on June 20, 2012.
Chartered Accountants, Licensed Public Accountants
May 28, 2013
Waterloo, Canada
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Consolidated Statement of Financial Position
December 31, 2012, with comparative information for 2011
2012
2011
Financial assets:
Cash (note 2)
Temporary investments (note 3)
Taxes recoverable
Trade and other receivables
Long-term receivables (note 4)
$
12,735,102
7,741,303
4,604,719
3,269,888
5,249,679
33,600,691
$
6,582,084
7,536,926
3,914,956
3,208,053
6,381,868
27,623,887
Financial liabilities:
Accounts payable and accrued liabilities (note 5)
Solid waste closure and post-closure liabilities (note 7)
Post-employment benefits liabilities (note 14)
Deferred revenue (page 24)
Long-term liabilities (note 6)
Net financial assets
8,208,313
2,061,155
38,890
2,253,127
6,415,724
18,977,209
8,354,628
1,806,063
131,248
2,171,916
3,320,546
15,784,401
14,623,482
11,839,486
35,878
73,038
162,084,960
162,193,876
28,317
73,236
165,199,579
165,301,132
$ 176,817,358
$ 177,140,618
Non-financial assets:
Inventory of supplies
Prepaid expenses
Tangible capital assets (note 8)
Accumulated surplus (note 9)
The accompanying notes are an integral part of these consolidated financial statements.
1
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Consolidated Statement of Operations and Accumulated Surplus
Year ended December 31, 2012, with comparative information for 2011
2012
Budget
(unaudited note 10)
Revenue:
Taxation
Fees and user charges
Grants (note 13)
Other income (note 11)
Obligatory reserve fund revenue recognized
Total revenue
Expenses:
General government
Protection services
Transportation services
Environmental services
Health services
Recreation and culture services
Planning and development
Total expenses
Annual surplus (note 10)
Accumulated surplus, beginning of year
Accumulated surplus, end of year
2012
Actual
2011
Actual
$ 11,497,991
7,348,330
2,241,500
4,742,220
1,727,014
27,557,055
$ 11,488,862
7,279,335
1,945,713
1,516,253
1,485,687
23,715,850
$ 10,697,700
6,929,695
3,157,317
2,414,712
1,709,116
24,908,540
3,198,588
5,231,124
6,469,336
6,472,896
64,053
2,993,840
1,028,578
25,458,416
3,453,070
4,941,163
5,079,599
6,705,709
54,093
2,947,477
857,999
24,039,110
3,793,528
4,826,125
5,204,097
6,827,702
46,464
2,919,571
997,051
24,614,538
2,098,639
(323,260)
294,002
177,140,618
177,140,618
176,846,616
$ 179,239,257
$ 176,817,358
$ 177,140,618
The accompanying notes are an integral part of these consolidated financial statements
2
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Consolidated Statement of Changes in Net Financial Assets
Year ended December 31, 2012, with comparative information for 2011
2012
Budget
(unaudited note 10)
Annual surplus
Acquisition of tangible capital assets
Amortization of tangible capital assets
Loss on disposal of tangible capital assets
Proceeds on disposal of capital assets
Change in inventory of supplies
Change in prepaid expenses
Increase (decrease) in net financial assets
Net financial assets, beginning of year
Net financial assets, end of year
$
2,098,639
(9,134,855)
6,172,217
(2,962,638)
(863,999)
2012
Actual
$
(323,260)
2011
Actual
$
294,002
(2,998,673)
5,730,097
376,394
6,801
3,114,619
(5,552,603)
5,587,455
5,726
52,699
93,277
(7,561)
198
(7,363)
38,766
(14,667)
24,099
2,783,996
411,378
11,839,485
11,839,486
11,428,108
$ 10,975,486
$ 14,623,482
$ 11,839,486
The accompanying notes are an integral part of these consolidated financial statements
3
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Consolidated Statement of Cash Flows
Year ended December 31, 2012, with comparative information for 2011
2012
2011
Cash provided by (used in):
Operating activities:
Annual surplus
Items not involving cash:
Change in post-employment benefit liability
Change in solid waste closure and post-closure liabilities
Amortization
Loss on disposal of tangible capital assets
$
(323,260)
$
294,002
(92,358)
255,092
5,730,097
376,394
5,945,965
131,248
294,768
5,587,455
5,726
6,313,199
(689,763)
(61,835)
198
(7,561)
(146,315)
81,211
5,121,900
(55,173)
3,368,939
(14,667)
38,766
(1,769,363)
(354,240)
7,527,461
Capital transactions:
Cash used to acquire tangible capital assets
Proceeds on disposal of capital assets
Net change in cash from capital transactions
(2,998,673)
6,801
(2,991,872)
(5,552,603)
52,699
(5,499,904)
Investing activities:
Decrease (Increase) in Investments
Decrease (Increase) in long-term receivables
Net change from investing activities
(204,377)
1,132,189
927,812
2,867,182
(1,449,178)
1,418,004
Financing activities:
Proceeds from debt issuance
Repayment of long-term liabilities
Net Change from financing activities
3,914,000
(818,822)
3,095,178
(720,323)
(720,323)
Net change in cash and cash equivalents
6,153,018
2,725,238
Cash and cash equivalents, beginning of year
6,582,084
3,856,846
Change in non-cash working capital balances:
Taxes receivable
Trade and other recoverable
Prepaid expenses
Inventory of supplies
Accounts payable and accrued liabilities
Deferred revenue
Net change in cash from operating activities
Cash and cash equivalents, end of year
$ 12,735,102
$
6,582,084
The accompanying notes are an integral part of these consolidated financial statements.
4
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Summary of Significant Accounting Policies
Year ended December 31, 2012
1. Significant accounting policies:
(a) Basis of accounting:
The consolidated financial statements of The Corporation of the Town of The Blue Mountains
are the representations of management. They have been prepared in accordance with
Canadian Public Sector Accounting Board of the Canadian Institute of Chartered Accountants
as prescribed by the Ontario Ministry of Municipal Affairs and Housing.
Revenues and expenses are reported on the accrual basis of accounting. The accrual basis
of accounting recognizes revenues as they become available and measureable; expenses are
recognized as they are incurred and measureable as a result of receipt of goods or services
and the creation of a legal obligation to pay.
(b) Use of estimates:
The preparation of financial statements in accordance with Canadian public sector accounting
standards requires management to make estimates that affect the reported amounts of
assets and liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting period. Estimates are used when accounting for
items such as accrued grant receivables, accrued liabilities, post-employment benefits and
solid waste landfill closure and post-closure costs. By their nature, these estimates are
subject to measurement uncertainty and actual results could differ from management’s best
estimates as additional information becomes available in the future.
(c) Basis of consolidation:
The consolidated statements reflects the assets, liabilities, revenues and expenses of all
municipal organizations, revenues and expenses of all municipal organizations, committees,
and boards which are owned or controlled by Council. All interfund assets and liabilities and
revenues and expenses have been eliminated on consolidation.
The following board controlled by Council has been consolidated:
The Blue Mountains Public Library Board
A government partnership exists where the municipality has shared control over the board or
entity. The municipality’s pro-rata share of the assets, liabilities, revenues and expenses are
reflected in the financial statements using the proportionate consolidation method. The
municipality’s proportionate interest of the following government partnership is reflected in the
consolidated financial statements:
Georgian Trail Board of Management
41%
5
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Summary of Significant Accounting Policies (continued)
Year ended December 31, 2012
1. Significant accounting policies (continued):
(d) Cash and cash equivalents:
Cash and cash equivalents include all cash balances and short-term highly liquid investments
that are readily convertible into cash.
(e) Temporary investments:
Temporary investments are recorded at the lower of cost or market.
(f) Long-term receivables:
Long-term receivables are recorded at cost.
(g) Inventory of supplies:
Inventory held for consumption is recorded at the lower of cost and replacement cost.
(h) Tangible capital assets:
Tangible capital assets are recorded at cost less accumulated amortization. Costs include all
amounts that are directly attributable to acquisition, construction, development or betterment
of the asset. Amortization is provided over the estimated useful life of the assets, using the
straight-line method. The useful life of the assets is based on estimates made by Council. The
following rates are used:
Asset
Land improvements
Buildings
Machinery, equipment and vehicles
Water systems
Sewer systems
Roads
Useful Life - Years
10 to 50 years
15 to 50 years
5 to 50 years
20 to 100 years
20 to 100 years
10 to 75 years
Tangible capital assets received as contributions are recorded at fair value at the date of
receipt and also are recorded as revenue.
(i) Post-employment benefits:
The municipality provides post-employment health and life insurance benefits to eligible
retired employees. The benefits earned by employees are determined using management’s
best estimate of expected benefit costs and are expensed as services are rendered.
The contributions to the Ontario Municipal Employee’s Retirement System (“OMERS”), a
multi-employer defined benefit plan are expensed when contributions are due.
6
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Summary of Significant Accounting Policies (continued)
Year ended December 31, 2012
1. Significant accounting policies (continued):
(j) County and school board:
The municipality collects taxation revenue on behalf of the school boards and the County of
Grey. The taxation, other revenues, expenses, assets and liabilities with respect to the
operations of the school boards and the Country of Grey are not reflected in these financial
statements.
(k) Trust funds:
Funds held in trust by the municipality, and their related operations, are not included in these
financial statements. The financial activity and position of the trust funds are reported
separately on the trust funds statement of continuity and balance sheet.
(l) Revenue recognition:
Revenues are recognized as follows:
a) Tax levies are recognized as revenue when the amounts are levied on the municipality’s
ratepayers.
b) Fines and donations are recognized when collected.
c) Other revenues are recorded upon sale of goods or provision of service when collection is
reasonably assured.
d) Investment income earned on surplus funds (other than obligatory reserve funds) are
reported as revenue in the period earned. Investment income earned on obligatory
reserve funds is recorded directly to each fund balance.
e) 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, and eligibility criteria have been met and reasonable estimates of the amounts
can be made.
f)
Revenue restricted by legislation, regulation or agreement and not available for general
municipal purposes is reported as deferred revenue on the consolidated statement of
financial position. The revenue is reported on the consolidated statement of operations in
the year in which it is used for the specified purpose.
7
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements
Year ended December 31, 2012
2. Cash:
Unrestricted
Restricted
2012
2011
$ 12,485,273
249,829
$ 6,123,183
458,901
$ 12,735,102
$ 6,582,084
The Town has established segregated interest-bearing bank accounts pursuant to agreements
with developers and these funds are for the sole purpose of paying capital costs relating to
specific developments.
Cash balances are earning interest at a rate of prime less 1.75%.
On December 31, 2012, the municipality had deposits of $12,754,532 (2011 - $6,747,285) in a
Canadian Chartered Bank. The Canadian Deposit Insurance Corporation insures deposits up to a
maximum of $100,000 per depositor.
The municipality has an available operating facility of $1,000,000 which was not drawn upon at
December 31, 2012. The operating facility is due on demand and bears interest at the bank’s
prime rate less 0.75%.
3. Temporary investments:
Business Advantage Plus savings account, 1.45%
Guaranteed Investment Certificates, 1.50% to
2.10%, due 2014
2012
2011
$ 2,232,442
$ 3,105,271
5,508,861
4,431,655
$ 7,741,303
$ 7,536,926
Investments have a market value of $7,741,303 (2011- $7,536,926) at the end of the year.
On December 31, 2012, the municipality had investment deposits of $5,232,442 (2011 $5,144,471) in one Canadian Financial Institution. The Canadian Deposit Insurance Corporation
insures deposits up to a maximum of $100,000 per depositor.
8
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
4. Long-term receivables:
Water and sewer loans, 3.1% to 18%, due 2012 to 2029
Tile drainage loans, 6% to 8%, due 2012 to 2016
Loan receivable, North East Grey Health Clinics Inc.,
interest free, due in full on or before December 31, 2015
Loan receivable, Marsh Street Community Centre
interest free, due in full on or before August 31, 2022
2012
2011
$ 5,006,450
23,264
$ 5,931,958
29,910
200,000
420,000
19,965
-
$ 5,249,679
$ 6,381,868
2012
2011
$ 2,139,891
512,330
5,556,092
$ 1,916,021
658,262
5,780,345
$ 8,208,313
$ 8,354,628
5. Accounts payable and accrued liabilities:
Trade accounts payable
Accrued liabilities
Developer and other deposits
6. Long-term liabilities:
The balance of long-term liabilities reported on the consolidated statement of financial position is
made up of the following:
2012
Loan payable, prime less 0.25%, repayable in annual
principal instalments of $115,000 plus interest, due 2012
$
Loan payable, 4.85%, repayable in annual principal
instalments of $450,000 plus interest, due 2014
Loan payable, 4.85%, repayable in blended annual
payments of $83,608, due 2014
Loan payable, 5.11%, repayable in semi-annual principal
instalments of $40,000 plus interest, due 2031
Loan payable, 2%, repayable in blended semi- annual
payments of $128,000, due 2027
Loan payable, 3.58%, repayable in blended semi-annual principal
instalments of $18,687, due 2037
Tile drainage loans payable, 6% to 8%, due from 2012
to 2016
$
-
2011
$
115,000
900,000
1,350,000
153,327
225,636
1,520,000
1,600,000
3,205,133
-
614,000
-
23,264
29,910
6,415,724
$
3,320,546
The interest expense included on the consolidated statements of operations and accumulated
surplus totals $196,869 (2011 - $188,319).
9
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
6. Long-term liabilities (continued):
Principal payments estimated for the next 5 fiscal years, and thereafter, if not demanded, are as
follows:
2013
2014
2015
2016
2017
Thereafter
$
$
821,192
825,385
302,208
307,147
306,445
3,853,347
6,415,724
7. Solid waste closure and post-closure liabilities:
Solid waste closure and post-closure care requirements have been defined in accordance with
industry standards and include final covering and landscaping of the landfill, removal of ground
water and leachates, and ongoing environmental monitoring, site inspection and maintenance.
The liability for the landfill site is recorded at $2,061,155 (2011 - $1,806,063) and represents the
present value of closure and post-closure costs for 91% of the current site’s capacity, using the
municipality’s average long-term borrowing rate of 3.93%. The liability is recorded based on the
capacity of the landfill used to date. The total estimated future expenses for closure and postclosure care are $2,260,306 leaving an amount to be recognized of $199,151. The estimated
remaining capacity of the site’s opened cells are approximately 32,600 cubic metres, which will be
filled in 3 years. Post-closure care is estimated to continue for a period of 50 years.
The Town has a landfill reserve to help fund a portion of the liability. During 2012, there were no
transfers to or from this reserve. The balance of this reserve at December 31, 2012 is $194,474.
10
THE CORPORATION OF THE TOWN OF THE BLUE MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
8. Tangible capital assets
Land
Land Improvements
2012
Cost, beginning
of year
$
5,974,779
$
Machinery,
equipment and
Buildings
vehicles
6,064,404
$ 27,375,210
$ 24,027,700
Additions
107,463
163,088
864,672
Disposals
(31,790)
Transfers
(1,080,638)
$
Water
system
Sewer
system
Roads
43,214,926
$ 56,799,530
$ 77,905,942
$
1,651,609
(188,230)
Work in
progress
Total
937,701
$ 242,300,192
211,841
2,998,673
(718,600)
1,266
28,113
6,140,077
26,458,926
24,732,255
43,214,926
56,799,466
78,924,300
2,244,203
8,539,475
9,594,696
11,624,422
9,910,498
35,187,319
77,100,613
Amortization
226,692
716,112
1,289,209
581,989
695,862
2,220,233
5,730,097
Disposals
(31,790)
Cost, end of year
5,974,779
Accumulated
amortization,
beginning of year
Accumulated
amortization,
end of year
Net carrying
amount, end of
year
$
5,974,779
$
(1,080,638)
(64)
(2,019,258)
(175,704)
2,439,105
8,174,949
10,708,201
3,700,972
$ 18,283,977
$ 14,024,054
85,349
(114,664)
1,034,878
(347,931)
$
12,206,411
10,606,360
37,059,621
31,008,515
$ 46,193,106
$ 41,864,679
243,279,607
(1,636,063)
81,194,647
$
1,034,878
$ 162,084,960
11
THE CORPORATION OF THE TOWN OF THE BLUE MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
8. Tangible capital assets (continued):
Land
Land Improvements
2011
Cost, beginning
of year
$
Additions
5,839,166
$
134,367
Machinery,
equipment and
Buildings
vehicles
5,464,894
$ 18,883,235
$ 23,314,625
369,187
2,668,266
1,569,671
(47,500)
(857,343)
Sewer
system
Roads
43,068,275
$ 56,756,312
$ 77,396,510
128,419
43,218
522,422
Disposals
-
Transfers
1,246
230,323
5,871,209
747
18,232
5,974,779
6,064,404
27,375,210
24,027,700
43,214,926
56,799,530
77,905,942
Cost, end of year
-
$
Water
system
-
-
$
(12,990)
Work in
progress
Total
6,942,405
$ 237,665,422
117,053
5,552,603
-
-
(6,121,757)
937,701
(917,833)
242,300,192
Accumulated
amortization
beginning of year
-
2,028,613
7,945,759
9,159,102
11,042,174
9,213,029
32,983,889
-
72,372,566
Amortization
-
215,590
622,316
1,253,412
582,248
697,469
2,216,420
-
5,587,455
Disposals
-
Accumulated
amortization
end of year
-
Net carrying
amount, end of
year
$
5,974,779
-
$
(28,600)
(817,818)
2,244,203
8,539,475
9,594,696
3,820,201
$ 18,835,735
$ 14,433,004
-
$
-
(12,990)
11,624,422
9,910,498
35,187,319
31,590,504
$ 46,889,032
$ 42,718,623
-
-
$
937,817
(859,408)
77,100,613
$ 165,199,579
12
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
8. Tangible capital assets (continued):
The net book value of tangible capital assets, not being amortized because they are under
construction, is $1,034,878 (2011 - $937,701).
The municipality holds various works of art and historical treasures. These items are not
recognized as tangible capital assets in the financial statements because a reasonable estimate
of the future benefits associated with such property cannot be made.
$25,089 (2011- $51,484) in interest was capitalized to tangible capital assets during the year.
9. Accumulated surplus:
Accumulated surplus consists of individual fund surplus and reserves as follows:
2012
Invested in tangible capital assets:
Tangible capital assets at cost less amortization
Unfinanced capital assets
Capital assets financed by long-term liabilities
and to be funded in future years (note 6)
2011
$ 162,084,960
(3,592,071)
$ 165,199,579
(8,008,390)
(6,392,460)
(3,290,636)
Total invested in capital assets
152,100,429
153,900,553
Unfunded vacation and post-employment benefits
Unfunded projects
Unfunded solid waste closure and post-closure costs
General surplus
Cemeteries
Recreation, community centres and arenas
(156,147)
(51,132)
(2,061,155)
252,801
(76,745)
70,739
150,078,790
(255,066)
(104,395)
(1,806,063)
21,736
(38,905)
77,639
151,795,499
26,738,568
25,345,119
$ 176,817,358
$ 177,140,618
Reserves and reserve funds
Accumulated surplus
13
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
9. Accumulated surplus (continued):
2012
Reserves:
Working funds
Insurance, sick leaves and WSIB
Current purposes
Capital purposes
Reserve funds:
Capital purposes
$
1,884,573
275,095
1,067,666
4,544,329
7,771,663
2011
$
2,822,914
262,674
1,123,026
4,685,969
8,894,583
18,966,905
16,450,536
$ 26,738,568
$ 25,345,119
14
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
10. Budgets:
Under Canadian public sector accounting principles, budget amounts are to be reported on the
consolidated statement of operations and changes in net debt for comparative purposes. The
2012 budget amounts for The Corporation of the Town of The Blue Mountains approved by
Council have been reclassified to conform to the presentation of the consolidated statements of
operations and changes in net debt. The following is a reconciliation of the budget approved by
Council. The budget figures have not been audited.
2012
Budget
Annual surplus
Amortization
Change in unfunded liabilities
Change in unfunded operating expenses
Change in other surpluses
$2,098,639
6,172,217
(72,000)
(290,000)
2011
Actual
7,908,856
$ (323,260)
5,730,097
156,173
(53,264)
44,739
5,554,485
15,754
(1,393,450)
(748,375)
(9,134,855)
(2,615,476)
(5,494,178)
1,385,791
664,504
(891,050)
(51,000)
(4,416,319)
3,914,000
(812,175)
231,065
(196,051)
(713,892)
(1,945,481)
Net transfers from (to) reserves
Capital acquisitions, disposals
and write-down
Capital projects not funded
Proceeds from long-term debt
Debt principal repayments
2012
Actual
Prior year general surplus
51,000
-
$
21,736
General surplus (note 9)
$
$
252,801
Revenues
Expenses
27,557,055
25,458,416
23,715,850
24,039,110
Annual surplus (deficit)
$2,098,639
$ (323,260)
294,002
5,587,455
405,163
(166,470)
(913,135)
5,207,015
1,967,217
$
21,736
24,908,540
24,614,538
$
294,002
15
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Consolidated Financial Statements (continued)
Year ended December 31, 2012
11. Other income:
2012
Budget
Penalties and interest on taxation
Other fines and penalties
Investment income
Licenses, permits and rents
Donations
Developer Contributions
Donated Capital Assets
Loss on disposal of capital assets
Local improvements
Other
2012
Actual
$ 480,000
71,695
287,250
335,925
21,950
2,607,000
2,000
849,000
87,400
$
593,158
64,169
513,026
424,605
16,077
109,401
42,139
(376,394)
130,072
$4,742,220
$ 1,516,253
2011
Actual
$
532,972
96,495
394,641
372,103
16,802
(5,726)
931,592
75,833
$ 2,414,712
12. Government business partnerships:
Georgian Trail Board of Management:
Georgian Trail Board of Management is a joint board under the shared control of The Corporation
of the Town of The Blue Mountains, the Town of Collingwood and the Municipality of Meaford.
The consolidated financial statements include the municipality’s 41% proportionate interest of the
following:
2012
Financial assets
Liabilities
Net financial assets
$
Prepaid expenses
204,022
24,527
179,495
2011
$
310
206,988
10,524
196,464
310
Accumulated surplus
$
179,805
$
196,774
Revenues
Expenses
$
58,392
75,361
$
55,200
25,820
Annual surplus (deficit)
$
(16,969)
$
29,380
16
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
13. Grants:
Operating:
Province of Ontario:
Ontario Municipal Partnership
Fund (OMPF)
Conditional - Roads
- Other
Government of Canada
- Other
Other municipalities
Conditional - Roads
- Other
Total operating grants
Capital:
Province Ontario
Conditional - Roads
- Sewer and water
- Other
Government of Canada
Conditional - Roads
- Sewer and water
- Other
Other municipalities
Conditional - Roads
- Other
Total capital grants
Total grants
2012
Actual
2011
Actual
$ 1,679,600
13,162
160,528
1,853,290
$ 1,567,400
15,107
167,034
1,749,541
8,069
15,599
1,770
1,770
1,574
1,574
$1,863,129
$ 1,766,714
7,963
7,963
270,417
26,080
501,492
797,989
36,963
36,963
46,589
26,080
519,945
592,614
37,658
-
82,584
1,390,603
$1,945,713
$ 3,157,317
17
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
14. Retirement and post-employment benefit:
The municipality provides certain retirement benefits to retired employees who met certain
requirements upon retirement. The municipality pays for the cost of extended health benefits and
life insurance for the retired employees. The post-employment benefit at December 31 includes
the following component:
2012
Retirement benefits
$
38,890
2011
$
131,248
The assumptions used reflect management’s best estimates. The post-employment benefit
liability was determined using a discount rate of 3.73%. The health and life insurance costs, a
2.33% annual rate of increase was assumed for 2012 and forwards.
15. Pension agreements:
The municipality makes contributions to the Ontario Municipality Employees Retirement Systems
Fund (OMERS), which is a multi-employer plan, on behalf of its staff. This plan is a defined
benefit plan which specifies the amount of the retirement benefits to be received by the
employees based on the length of service and rates of pay. Employees and employers contribute
jointly to the plan. The employer amount contributed on OMERS on behalf of 103 members of
staff for 2012 current service was $561,407 (2011 - $495,098). The contribution rate for 2012
was 8.3% to 13.9% depending on age and income level (2011 - 7.4% to 14.1%).
OMERS is a multi-employer plan, therefore, any pension plan surpluses or deficits are a joint
responsibility of Ontario municipal organizations and their employees. As a result, the municipality
does not recognize any share of the OMERS pension surplus or deficit. The last available report
for the OMERS plan was December 31, 2012. At that time, the plan reported a $9.9 billion
actuarial deficit (2011 - $7.3 billion actuarial deficit) , based on an actuarial liabilities of $69.1
billion (2011 - $64.5 billion) and actuarial assets of $60.5 billion ( 2011 - $54.9 billion). Ongoing
adequacy of the current contribution rates will need to be monitored as the severe decline in the
financial markets may lead to increased future funding requirements.
18
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
16. Trust funds:
The trust funds administered by the municipality amounting to $284,750 (2011 - $274,889) have
not been included in the consolidated statement of financial position nor have the operations been
included in the consolidated statement of financial activities. At December 31, 2012, the trust
fund balances are as follows:
2012
Cemetery Care and Maintenance funds
$
284,750
2011
$
274,889
17. Contractual commitments:
(a) The Corporation of the Town of The Blue Mountains has entered into contracts totalling
$3,322,749 to upgrade and extend road, sewer and water services and purchase equipment.
A total of $1,237,010 remains to be spent. These commitments will be funded by municipal
reserve funds, development charges, local improvement charges, government grants and
long-term debt.
(b) The Corporation of the Town of The Blue Mountains has entered into agreements with various
contractors for water, winter maintenance, garbage, and recycling collection services for the
following amounts:
2013
2014
2015
2016
2017-2025
Total
$ 1,621,024
1,490,238
1,099,061
588,381
5,317,885
$ 10,116,589
(c) The Corporation of the Town of The Blue Mountains has entered into lease agreements with
various contractors for vehicles and equipment for the following amounts:
2013
2014
2015
2016
2017
Total
$
$
77,286
77,286
47,374
6,347
2,678
210,971
19
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
18. Subdivision agreements:
As part of various subdivision agreements, the municipality has received letters of credit to cover
developers’ responsibilities in completing the projects as well as covering unpaid municipal levies.
Letters of credit held by the municipality at December 31, 2012 amount to $5,397,530 (2011 $5,806,634).
19. Contingencies:
OMERS has notified The Corporation of the Town of The Blue Mountains that the Town may be
required to pay OMERS contributions for an omission period from 1998 to 2007. The effect on
expenses, if any, will be recorded in the fiscal year in which it can be determined.
The Town is subject to various litigation and claims arising in the normal course of its operations.
The final outcome of the outstanding claims cannot be determined at this time. Management
assesses such claims and where considered likely to be material exposure and, where the
amount of the claim is quantifiable, provisions for loss are made based on management’s
assessment of likely outcome. The Town does not provide for claims that are considered unlikely
to result in a significant loss, claims for which the outcome is not determinable or claims where the
amount of loss cannot be reasonably estimated. Any settlements or awards under such claims are
provided when reasonably determinable. It is the opinion of management that exposure to
property, liability, and accident claims is adequately covered by the Town’s insurance coverage.
20. Segmented information:
The Town of The Blue Mountains is a diversified municipal government institution that provides a
wide range of services to its citizens such as police, fire, sewer, water, waste collection, disposal
and recycling, recreational, library and planning. Distinguishable functional segments have been
separately disclosed in the segmented information. The nature of the segments and the activities
they encompass are as follows:
(a) General government:
This item relates to the revenues and expense that relate to the governance and operation of
the municipality itself and cannot be directly attributed to a specific segment.
(b) Protection to persons and property services:
Protection is comprised of police services, fire protection, conversation authority, emergency
measures, animal control and building and structural inspection. The police services work to
ensure the safety and protection of the citizens and their property. The fire department is
responsible to provide fire suppression service, fire prevention programs training and
education. The members of the fire department consist of volunteers. Building and by-law
services provides a number of services including by-law enforcement, maintenance and
enforcement of building and construction codes and review of all property development plans
through its application process.
20
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
20. Segmented information (continued):
(c) Transportation services:
Transportation is responsible for construction and maintenance of the municipality’s
roadways, bridges, parking areas and streetlighting.
(d) Environmental services:
Environmental services consist of providing water, wastewater and solid waste collection and
disposal services. It also ensures the municipality’s water system meets all Provincial
standards.
(e) Health services:
Health services include contributions to the operations of local cemeteries.
(f) Recreational and cultural services:
This service area provides services meant to improve the health and development of the
municipality’s citizens. The municipally operates and maintains parks and arenas. The
municipality also provides library services and recreational programs.
(g) Planning and development:
This department is responsible for planning and zoning including the Official Plan. This
service area also includes tourist information and promotion, business improvement area,
weed control, and drainage.
The accounting policies of the segments are the same as those described in the summary of
significant accounting policies. Amounts that are directly attributable to a number of
segments have been allocated on a reasonable basis as follows:

Taxation, payments-in-lieu and penalties and interest:
Allocated to those segments that are funded by these amounts based on the actual for
the year.

OMPF grants:
Allocated to segments based on the actuals for the year.
21
THE CORPORATION OF THE TOWN OF THE BLUE MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
20. Segmented information (continued):
Health
services
Recreation
and
cultural
services
$
30,457
24,002
4,453
8,635
-
$1,457,215
749,279
88,452
213,036
77,166
143,160
$
460,680
202,653
67,349
162
9,000
$ 11,488,862
7,279,335
266,113
1,679,600
1,516,253
1,485,687
$ 9,481,620
$
67,547
$2,728,308
$
739,844
$ 23,715,850
$ 1,312,915
978,837
348,036
14,255
2,425,556
$ 1,623,214
169,216
2,206,495
654,250
19,193
2,033,341
$
27,390
16,337
4,433
2,171
3,762
$1,551,029
3,163
777,008
30,808
7,731
577,738
$
566,900
1,962
133,702
126,504
25,112
1,400
2,419
$8,861,825
221,663
4,905,647
3,807,083
331,309
181,486
5,730,097
5,079,599
6,705,709
54,093
2,947,477
857,999
24,039,110
13,454
$ (219,169)
(118,155)
$ (323,260)
2012
General
government
Protection
services
Transportation
services
Environmental
services
Revenue:
Taxation
Fees and user charges
Specific grants
OMPF grant
Other revenue
Transfers from obligatory reserve
$ 1,944,262
23,916
34,810
284,238
798,956
3,019
$ 2,782,137
73,749
9,703
406,731
472,991
7,688
$2,860,084
107,976
13,162
418,126
45,821
411,162
$1,954,027
6,097,760
119,986
285,667
112,522
911,658
$ 3,089,201
$ 3,752,999
$ 3,856,331
$ 2,277,810
37,917
360,816
199,086
20,000
115,615
441,826
$ 1,502,567
9,405
432,452
2,443,966
286,197
21,121
245,455
3,453,070
4,941,163
Expenses:
Salaries and benefits
Interest on debt
Materials and supplies
Contracted services
Other transfers
Rent and financials
Amortization
Annual surplus (deficit)
$ (363,869)
$ (1,188,164)
$ (1,223,268)
$ 2,775,911
$
Planning
and
development
$
22
Total
THE CORPORATION OF THE TOWN OF THE BLUE MOUNTAINS
Notes to Financial Statements (continued)
Year ended December 31, 2012
20. Segmented information (continued):
Health
services
Recreation
and
cultural
services
23,783
40,858
3,485
8,992
-
$ 1,325,409
706,015
151,855
194,196
39,845
269,088
10,298,569
77,118
1,193,429
1,212,166
400,322
13,442
2,384,738
1,591,340
181,344
2,354,317
643,069
4,200
20,909
2,032,523
5,204,097
6,827,702
2011
General
government
Protection
services
Transportation
services
Environmental
services
Revenue:
Taxation
Fees and user charges
Specific grants
OMPF grant
Other revenue
Transfers from obligatory reserve
$ 1,941,736
15,117
938,253
284,497
898,301
2,397
$ 2,470,276
71,114
12,494
361,939
447,133
25,098
$ 2,663,743
94,183
332,113
390,285
24,475
90,716
$ 1,798,490
5,842,828
155,202
263,510
995,883
1,242,656
4,080,301
3,388,054
3,595,515
2,413,625
398,255
281,038
370,000
6,726
323,884
1,630,115
438,544
2,219,764
280,515
8,831
248,356
3,793,528
4,826,125
Expenses:
Salaries and benefits
Interest on debt
Materials and supplies
Contracted services
Other transfers
Rent and financials
Amortization
Annual surplus (deficit)
$ 286,773
$ (1,438,071)
$ (1,608,582)
$ 3,470,867
$
$
Planning
and
development
$
Total
474,263
159,580
69,488
83
79,161
$ 10,697,700
6,929,695
1,589,917
1,567,400
2,414,712
1,709,116
2,686,408
782,575
24,908,540
25,414
11,785
6,632
2,106
527
1,510,181
4,600
767,200
35,279
7,217
595,094
588,889
2,375
191,772
176,067
33,043
2,573
2,332
8,952,993
188,319
5,374,039
3,762,171
687,758
61,804
5,587,454
46,464
2,919,571
997,051
24,614,538
30,654
$ (233,163)
$
(214,476)
23
$
294,002
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Schedule of Deferred Revenue
Year ended December 31, 2012
Opening
Obligatory reserve funds:
Development charges
Recreational land
Parking revenues
Federal gas tax
Other:
Provincial grants
Hall deposits
Harbour deposits
Developer Contributions
Other
Contributions
received
Investment
income
Revenue
recognized
Ending
$ 590,747
1,057,070
27,339
445,186
$ 966,091
(25,452)
3,000
209,357
$
4,500
12,526
344
6,463
$(1,369,380)
(53,173)
(63,134)
$2,120,342
$1,152,996 $
23,833
$(1,485,687) $1,811,484
$
$ 14,277
300
3,600
417,500
39,959
$ 475,636
$
5,835
700
6,750
38,289
51,574
$2,171,916
$
$
-
$1,628,632 $
23,833
$
$
$191,958
990,971
30,683
597,872
(5,835) $ 14,277
(700)
300
(2,000)
8,350
(38,743)
378,757
(38,289)
39,959
(85,567) $ 441,643
$(1,571,254) $2,253,127
24
Trust Funds Financial Information
THE CORPORATION OF THE
TOWN OF THE BLUE MOUNTAINS
Year ended December 31, 2012
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Trust Funds
Year ended December 31, 2012
Page
The Corporation of the Town of The Blue Mountains Trust Funds:
Auditors’ Report ................................................................................................................................
Balance Sheet and Statement of Continuity ................................................................................... 1
Notes to Financial Information ........................................................................................................ 2
KPMG LLP
Chartered Accountants
115 King Street South, 2nd Floor
Waterloo ON N2J 5A3
Telephone
Fax
Internet
519-747-8800
519-747-8830
www.kpmg.ca
INDEPENDENT AUDITORS’ REPORT
To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Town of The Blue
Mountains
We have audited the accompanying financial information of the trust funds of The Corporation of the
Town of The Blue Mountains, ("the Entity"), which comprise the balance sheet as at December 31,
2012 and the statement of continuity 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 this financial information in
accordance with Canadian public sector accounting standards, and for such internal control as
management determines is necessary to enable the preparation of the financial information that is
free from material misstatement, whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express an opinion on this financial information 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 an audit to obtain
reasonable assurance about whether the financial information are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures
in the financial information. The procedures selected depend on our judgment, including the
assessment of the risks of material misstatement of the financial information, whether due to fraud or
error. In making those risk assessments, we consider internal control relevant to the Entity's
preparation and fair presentation of the financial information 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 information.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
KPMG LLP, is a Canadian limited liability partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity.
KPMG Canada provides services to KPMG LLP.
Page 2
Opinion
In our opinion, the financial information present fairly, in all material respects, the balance sheet for
the trust funds of The Corporation of the Town of The Blue Mountains as at December 31, 2012, and
the statement of continuity for the year then ended in accordance with Canadian public sector
accounting standards.
Comparative Information
The consolidated financial statements of the trust funds of The Corporation of the Town of The Blue
Mountains as at end for the year ended December 31, 2011 were audited by another auditor who
expressed an unmodified opinion on those statements on June 20, 2012.
Chartered Accountants, Licensed Public Accountants
May 28, 2013
Waterloo, Canada
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAIN
Trust Funds
Balance Sheet
December 31, 2012, with comparative information for 2011
2012
2011
Assets
Cash
Investments (note 2)
Due from the Town
Fund balance
$
989
280,120
3,641
$
1,057
269,170
4,662
$
284,750
$ 274,889
$
284,750
$ 274,889
2012
2011
274,889
$ 262,946
1,200
0
3,400
5,261
8,430
18,291
1,150
990
7,152
2,651
8,992
20,935
8,430
8,992
284,750
$ 274,889
Statement of Continuity
Year ended December 31, 2012, with comparative information for 2011
Balance, beginning of year
$
Receipts:
Monument fees
Niche sales
Share of plot sales
Capital gains
Investment income
Expenses:
Contributions to cemetery
Balance, end of year
$
The accompanying notes are an integral part of these consolidated financial statements.
1
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Notes to Financial Statements
Year ended December 31, 2012
1. Significant accounting policies:
(a) Basis of accounting:
The financial information of The Corporation of the Town of the Blue Mountains Trust Funds
are the representation of management. They have been prepared in accordance with
accounting principles established by the Public Sector Accounting Board of the Canadian
Institute of Chartered Accountants as prescribed by the Ontario Ministry of Municipal affairs
and Housing.
Revenues and expenses are reported on the accrual basis of accounting. The accrual basis
of accounting recognizes revenues as they become available and measurable; expenses 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.
(b) Use of estimates:
The preparation of financial information in accordance with Canadian public sector accounting
standards requires management to make estimates that affect the reported amounts of
assets and liabilities at the date of the financial statements, and the reported amounts of
revenues and expenses during the reporting period. By their nature, these estimates are
subject to measurement uncertainty and actual results could differ from management’s best
estimates as additional information becomes available in the future.
(c) Basis of consolidation:
These Trust Funds have not been consolidated with the financial statements of the
municipality.
2. Investments:
The total investments of $280,120 reported on the balance sheet at cost have a market value of
$298,530 at the end of the year.
2
Supplementary Financial Information
THE CORPORATION OF THE
TOWN OF THE BLUE MOUNTAINS
Year ended December 31, 2012
KPMG LLP
Chartered Accountants
115 King Street South, 2nd Floor
Waterloo ON N2J 5A3
Telephone
Fax
Internet
519-747-8800
519-747-8830
www.kpmg.ca
AUDITORS’ REPORT ON SUPPLEMENTARY
FINANCIAL INFORMATION
To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Town of The Blue
Mountains
We have audited the consolidated financial statements of The Corporation of the Town of The Blue
Mountains (the “Town”), which comprise the consolidated statements of financial position as at
December 31, 2012, the consolidated statements of operations and accumulated surplus, changes in
net financial assets and cash flows for the year then ended, and a summary of significant accounting
policies and other explanatory information, and have issued our report thereon dated June 20, 2012
which contained an unmodified opinion on those consolidated financial statements. The audit was
performed to form an opinion on the consolidated financial statements as a whole. The
supplementary financial information is presented for the purposes of additional analysis and is not a
required part of the consolidated financial statements. Such supplementary financial information is
the responsibility of management and was derived from the underlying accounting and other records
used to prepare the consolidated financial statements.
The supplementary financial information has been subjected to the auditing procedures applied in the
audit of the consolidated financial statements and certain additional procedures, including comparing
and reconciling such supplementary information directly to the underlying accounting and other
records used to prepare the consolidated financial statements or to the consolidated financial
statements themselves.
Restriction on distribution and use
The supplementary financial information is prepared to assist the Town’s management to meet the
requirements of the Ontario Ministry of Tourism and Culture. As a result, the supplementary financial
information may not be suitable for another purpose. Our report is intended solely for the Town’s
management and the Ontario Ministry of Tourism and Culture and should not be distributed to or
used by parties other than the Town’s management or the Ontario Ministry of Tourism and Culture.
Comparative Information
The supplementary financial information of The Corporation of the Town of The Blue Mountains
Museum Operations for the year ended December 31, 2011 were reported by another auditor who
expressed an unmodified report on that statement on June 20, 2012.
Chartered Accountants, Licensed Public Accountants
May 28, 2013
Waterloo, Canada
THE CORPORATION OF THE TOWN OF THE BLUE
MOUNTAINS
Museum Statement of Operations
(See Auditors’ Comments on Supplementary Financial Information)
Year ended December 31, 2012, with comparative information for 2011
2012
Revenues:
Grants
Donations
Admission, program fees and membership
Sundry
Rent
$
Expenditures:
Exhibits and programs
Operating supplies
Maintenance of premises and utilities
Salaries and benefits
Annual deficit
Funded by the Town of The Blue Mountains
$
16,138
251
3,781
1,056
5,000
26,226
2011
$
44,945
175
3,707
783
5,000
54,610
2,956
14,703
11,132
88,749
117,540
2,278
17,794
9,431
88,741
118,244
(91,314)
(63,634)
91,314
63,634
-
$
-
1
Financial Statements of
THE BLUE MOUNTAINS
PUBLIC LIBRARY BOARD
Year ended December 31, 2012
KPMG LLP
Chartered Accountants
115 King Street South, 2nd Floor
Waterloo ON N2J 5A3
Telephone
Fax
Internet
519-747-8800
519-747-8830
www.kpmg.ca
INDEPENDENT AUDITORS’ REPORT
To the Members of Council, Inhabitants and Ratepayers of The Corporation of the Town of The Blue
Mountains
We have audited the accompanying financial statements of The Blue Mountains Public Library Board
("the Entity"), which comprise the statement of financial position as at December 31, 2012 and the
statements of operations and accumulated surplus, changes in net financial assets and cash flows
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 public sector accounting standards, and for such internal control as
management determines is necessary to enable the preparation of the 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 an audit to obtain
reasonable assurance about whether the financial statements are free from 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 our 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, we consider 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.
KPMG LLP, is a Canadian limited liability partnership and a member firm of the KPMG
network of independent member firms affiliated with KPMG International Cooperative
(“KPMG International”), a Swiss entity.
KPMG Canada provides services to KPMG LLP.
Page 2
Opinion
In our opinion, the financial statements present fairly, in all material respects, the financial position of
The Blue Mountains Public Library Board as at December 31, 2012, and the results of its operations,
changes in net assets and cash flows for the year then ended in accordance with Canadian public
sector accounting standards.
Comparative Information
The financial statements of The Blue Mountains Public Library Board as at end for the year ended
December 31, 2011 were audited by another auditor who expressed an unmodified opinion on those
statements on June 20, 2012.
Chartered Accountants, Licensed Public Accountants
May 28, 2013
Waterloo, Canada
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Statement of Financial Position
December 31, 2012, with comparative information for 2011
2012
2011
Financial assets:
Cash (note 2)
Temporary investments (note 3)
$
130,398
103,504
233,902
$
83,553
83,553
Financial liabilities:
Due to Town
Net financial assets
19,333
19,333
-
214,569
83,553
1,815,998
1,815,998
1,918,120
1,918,120
Non-financial assets:
Tangible capital assets (note 8)
Accumulated surplus (note 9)
$
2,030,567
$
2,001,673
1
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Statement of Operations and Accumulated Surplus
Year ended December 31, 2012, with comparative information for 2011
Budget
2012
(note 6)
Revenue:
Operating grants:
Province of Ontario
Government of Canada
Town of The Blue Mountains
Capital grants:
Government of Canada
Provincial and other municipalities
Town of The Blue Mountains
Capital donations
Fundraising
Interest
Other
Total revenue
$
Expenses:
Salaries and benefits
Administrative
Operating
Books and materials
Communications
Training and travel
Personnel
Utilities
Equipment
Professional fees
Financial related expenses
Premises
Other
Information technology
Amortization
Total expenses
Annual surplus (deficit) (note 5)
Accumulated surplus, beginning of year
Accumulated surplus, end of year
$
21,000
2,500
586,780
Actual
2012
$
22,100
4,341
651,386
Actual
2011
$
21,263
2,464
523,993
3,500
19,300
633,080
1,565
2,129
86,030
1,250
5,675
25
25,776
800,277
4,079
21,025
72,515
2,315
6,273
17,374
671,301
441,685
14,710
3,000
3,800
12,600
6,250
1,800
23,395
15,500
3,450
9,240
32,535
3,000
570,965
455,847
15,134
2,525
3,628
11,918
4,906
2,577
25,049
12,438
1,950
10,956
29,291
2,753
23,661
168,750
771,383
431,140
17,214
3,129
3,665
13,076
4,997
1,912
24,298
12,248
1,822
9,545
31,794
5,131
24,423
188,878
773,272
62,115
28,894
(101,971)
2,001,673
2,001,673
2,063,788
$ 2,030,567
2,103,644
$
2,001,673
The accompanying notes are an integral part of these consolidated financial statements
2
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Statement of Changes in Net Financial Assets
Year ended December 31, 2012, with comparative information for 2011
Budget
2012
(note 6)
Annual surplus
$
Acquisition of tangible capital assets
Amortization of tangible capital assets
Loss on disposal of tangible capital assets
62,115
Actual
2012
$
(62,115)
Net financial assets, beginning of year
Net financial assets, end of year
$
$ (101,971)
(66,628)
168,750
102,122
(62,115)
Increase in net financial assets
28,894
Actual
2011
(96,044)
188,878
10,500
103,334
-
131,016
1,363
83,553
83,553
82,190
83,553
$
214,569
$
83,553
The accompanying notes are an integral part of these consolidated financial statements
3
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Consolidated Statement of Cash Flows
Year ended December 31, 2012, with comparative figures for 2011
2012
2011
Cash provided by (used in):
Operating activities:
Annual surplus
Items not involving cash:
Amortization
Loss on disposal of tangible capital assets
$
28,894
$
(101,971)
168,750
197,644
188,878
10,500
97,407
Change in non-cash working capital balances:
Due to Town
Net change in cash from operating activities
19,333
216,977
97,407
Capital transactions:
Cash used to acquire tangible capital assets
Net change in cash from capital transactions
(66,628)
(66,628)
(96,044)
(96,044)
Investing activities:
Change in temporary investments
(19,951)
(1,363)
Net change in cash and cash equivalents
130,398
-
-
-
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year
$
130,398
$
-
The accompanying notes are an integral part of these consolidated financial statements.
4
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Notes to the Financial Statements
Year ended December 31, 2012
1. Significant accounting policies:
(a) Basis of accounting:
The financial statements of The Blue Mountains Public Library Board are the representation of
management prepared in accordance with Canadian public sector accounting standards
established by the Public Sector Accounting Board of the Canadian Institute of Chartered
Accountants as prescribed by the Ontario Ministry of Municipal Affairs and Housing.
Revenues and expenses are reported on the accrual basis of accounting. The accrual basis
of accounting recognizes revenues as they become available and measurable; expenses 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.
(b) Use of estimates:
Precise determination of some assets and liabilities may be dependent upon future events
and estimates and approximations. These estimates and approximations have been based
upon the available information, using careful judgment and review. By their nature, these
estimates are subject to measurement uncertainty and actual results could differ from
management’s best estimates as additional information becomes available in the future.
(c) Basis of consolidation:
The Public Library Board has been consolidated with the financial statements of The
Corporation of the Town of The Blue Mountains.
(d) Tangible capital assets:
Tangible capital assets are recorded at cost less accumulated amortization. Costs include all
amounts that are directly attributable to acquisition, construction, development or betterment
of the asset. Amortization is provided over the estimated useful life of the assets, using the
straight-line method. The useful life of the assets is based on estimates made by Council.
The following rates are used:
Asset
Buildings
Land improvements
Library collections
Machinery, equipment and vehicles
Useful Life - Years
15 - 50
10 - 50
7
5 - 20
Tangible capital assets received as contributions are recorded at fair value at the date of
receipt and also are recorded as revenue.
5
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Notes to the Financial Statements (continued)
Year ended December 31, 2012
1. Significant accounting policies (continued):
(e) Revenue recognitions:
Revenues are reported on the accrual basis of accounting and are recognized as follows:
(i) Grants are recorded as revenue when corresponding expenses have been incurred in
accordance with the grant applications.
(ii) Fines are recognized when received.
(iii) All other revenues are recorded upon sale of goods or provision of services and when
collection is reasonably assured.
2. Cash:
2012
Unrestricted
$
130,398
2011
$
-
3. Temporary investments:
2012
Unrestricted
$
103,504
2011
$
83,553
Investments have a market value of $103,504 (2011 - $83,553) at the end of the year.
4. Tangible capital assets:
Cost
Land
Land improvements
Buildings
Library collections
Machinery, equipment
and vehicles
$
756,487
261,716
1,077,300
1,600,849
333,981
$ 4,030,333
2012
2011
Accumulated
Net book
Net book
amortization
value
value
$
78,847
554,210
1,393,749
187,529
$ 2,214,335
$
756,487
182,869
523,090
207,100
146,452
$ 1,815,998
$
756,487
196,669
554,974
250,101
159,889
$ 1,918,120
6
THE BLUE MOUNTAINS PUBLIC LIBRARY BOARD
Notes to the Financial Statements
Year ended December 31, 2012
5. Accumulated surplus:
The organization segregates its accumulated surplus in the following categories:
2012
2011
Invested in capital assets
Reserves
$ 1,815,998
214,569
$ 1,918,120
83,553
Accumulated surplus
$ 2,030,567
$ 2,001,673
6. Budgets:
The budget adopted by the Board was not prepared on a basis consistent with that used to report
actual results (Canadian Public Sector Accounting Standards). The budget was prepared on a
modified accrual basis while Canadian Public Sector Accounting Standards now require a full
accrual basis. The budget figures anticipated the use of reserves accumulated in previous years
to reduce current year expenditures in excess of revenues to $nil. In addition, the budget
expensed all tangible capital expenditures rather than including amortization expense. The
following is a reconciliation of the budget approved by the Board. The budget figures have not
been audited.
Budget
2012
Annual surplus (deficit)
Transfers (to) from reserves
Capital acquisitions, disposals and
write-down
Amortization
$
Actual
2012
62,115
(62,115)
-
$
Actual
2011
28,894
(131,016)
$ (101,971)
(1,363)
(66,628)
168,750
(85,544)
188,878
-
$
-
7