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Home My Public Portal About2011 Financial StatementsCORPORATION OF THE MUNICIPALITY OF TWEED CONSOLIDATED FINANCIAL STATEMENTS December 31, 2011 CORPORATION OF THE MUNICIPALITY OF TWEED FINANCIAL STATEMENTS DECEMBER 31, 2011 Management's Responsibility for the Consolidated Financial Statements 2 Independent Auditor's Report 3 Consolidated Statement of Financial Position 4 Consolidated Statement of Operations and Accumulated Surplus .5 Consolidated Statement of Change in Net Financial Assets 6 Consolidated Statement of Cash Flows 7 Notes to Financial Statements 8-16 Schedule I - Consolidated Statement of Tangible Capital Assets 17 Schedule 2 - Consolidated Schedule of Continuity of Reserves and Reserve Funds 18 Schedule 3 - Consolidated Segmented Statement of Operations 19-21 Schedule 4 - Consolidated Schedule of Reconciliation of Financial Plan to the Budget 22 Trust Funds: Independent Auditor's Report 23 Balance Sheet 24 Notes to Financial Statements 25 Statement of Continuity Management's Responsibility for the Consolidated Financial Statements The consolidated financial statements of the Corporation of the Municipality of Tweed are the responsibility of management and have been approved by Council. The consolidated financial statements have been prepared in compliance with Canadian public sector accounting standards for local governments established by the Public Sector Accounting Board of The Canadian Institute of Chartered Accountants. A summary of the significant accounting policies are described in Note 1 to the consolidated financial statements. The preparation of consolidated financial statements necessarily involves the use of estimates based on management's judgement, particularly when transactions affecting the current accounting period cannot be finalized with certainty until future periods. The Corporation's management maintains a system of internal controls designed to provide reasonable assurance that assets are safeguarded, transactions are properly authorized and recorded in compliance with legislative and regulatory requirement, and reliable financial information is available on a timely basis for preparation of the consolidated financial statements. These systems are monitored and evaluated by management. Municipality's Council is responsible for ensuring that management fulfills its responsibilities for financial reporting. Council, through the Audit Committee, reviews the Corporation's consolidated financial statements and discusses any significant financial reporting or internal control matters prior to Council approval of the consolidated financial statements. The consolidated financial statements have been audited by Welch LLP, independent external auditors appointed by the Corporation, in accordance with Canadian generally accepted auditing standards. The accompanying Independent Auditor's Report outlines their responsibilities, the scope of their examination and their opinion on the Corporation's consolidated financial statements. Patricia Bergeron Betty Gallagher Chief Administrative Officer Deputy Clerk/Treasurer 2 INDEPENDENT AUDITOR'S REPORT To the Members of Council, of the Corporation of the Municipality of Tweed We have audited the accompanying consolidated financial statements of the CORPORATION OF THE MUNICIPALITY OF TWEED which comprise the statement of financial position at December 31, 2011 and 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. Management's Responsibility for the Consolidated 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 financial statements that are free from material misstatement, whether due to fraud or error. Auditor's 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 the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error_ In making those risk assessments, the auditor considers internal control relevant to the Corporation'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 Corporation'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 consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the CORPORATION OF TIRE MUNICIPALITY OF TWEED as at December 31, 2011 and the results of its operations and its cash flows for the year then ended in accordance with Canadian public sector accounting standards. Belleville, Ontario CHARTERED ACCOUNTANTS Date LICENSED PUBLIC ACCOUNTANTS 3 CORPORATION OF THE MUNICIPALITY OF TWEED CONSOLIDATED STATEMENT OF FINANCIAL POSITION DECEMBER 31, 2011 FINANCIAL ASSETS Cash - note 3 Taxes receivable Accounts receivable Long --term receivable - note 4 LIABILITIES Accounts payable and accrued liabilities Accrued liability - Waste Disposal closure - note 5 Deferred revenue - note 6 Long-term debt - note 7 NET FINANCIAL ASSETS NON -FINANCIAL ASSETS Tangible capital assets - note 1, schedule I Inventories of supplies ACCUMULATED SURPLUS - note 11 Contingent Liabilities - note 9 Approved by Council: Reeve CAO/Clerk (See accompanying notes) 2011 $ 1,945,545 $ 963,364 511,789 75,963 3,496,661 2010 645,167 955,911 1,955,373 52,086 3,608,537 205,325 389,046 561,800 300,000 205,015 178,267 75,963 37,187 1,048,103 904,500 2,448,558 2,704,037 26,650,522 32,220 26, 682,742 26,357,623 26,357,623 $ 29,131,300 $ 29,061,660 4 CORPORATION OF THE MUNICIPALITY OF TWEED CONSOLIDATED STA'T'EMENT OF OPERATIONS AND ACCUMULATED SURPLUS YEAR ENDED DECEMBER 31, 2011 REVENUE Municipal taxation Taxation from other governments Grants User charges Investment income Penalty and interest on taxes Other EXPENDITURE General government Protection to persons and property Transportation services Environmental services Recreation and cultural services Planning and development NET EXPENDITURES 2011 2011 Budget Actual (unaudited) $ 2,566,220 24,600 1,803,094 770,780 5,500 122,000 93,014 5,385,208 $ 2,543,146 21,259 1,889,204 881,857 9,905 137,335 108,382 5,591,088 2010 Actual $ 2,569,313 24,901 1,962,466 901,302 23,176 127,332 51,369 5,659,859 712,111 807,647 698,334 1,130,805 1,148,892 1,152,710 3,178,738 3,190,809 3,128,534 879,533 1,275,718 985,184 642,745 651,117 623,337 103,780 73,560 72,913 6,647,712 7,147,743 6,661,012 (1,262,504) OTHER INCOME AND EXPENSES RELATED TO CAPITAL Municipal taxation for capital purposes Government transfers: Canada Ontario Tangible capital assets gain Donations INTEREST EARNED ON RESERVE FUNDS ANNUAL SURPLUS 845,890 691,300 355,300 20,000 1,912,490 649,986 ACCUMULATED SURPLUS, beginning of year 29,061,660 Prior period adjustment - note 16 ACCUMULATED SURPLUS, beginning of year adjusted 29,061,660 ACCUMULATED SURPLUS, end of year $29,711,646 (See accompanying notes) (1,556,655) (1,001,153) 879,290 812,046 460,605 2,701,623 182,427 1,777,608 77,670 1,914 131,334 1,601,906 5,422,611 24,389 20,660 69,640 4,442,118 29,061,660 29,061,660 25,299,304 (679,762) 24,619,542 $29,131,300 $29,061,660 5 CORPORATION OF THE MUNICIPALITY OF TWEED CONSOLIDATED STATEMENT OF CHANGE IN NET FINANCIAL ASSETS DECEMBER 31, 2011 ANNUAL SURPLUS Amortization of tangible capital assets Acquisition of tangible capital assets Changes in assets under construction Gain on sale of tangible capital assets Proceeds on sale of tangible capital assets Acquisition of supplies CHANGE IN NET ASSETS NET FINANCIAL ASSETS, Prior period adjustment - note NET FINANCIAL ASSETS, NET FINANCIAL ASSETS, beginning of year 16 2011 Budget (unaudited) $ 649,986 1,875,818 (2,649,940) (124,136) 2,704,037 beginning of year adjusted 2,704,037 end of year 2011 Actual 2010 Actual 69,640 $ 4,442,118 1,875,818 1,867,850 (2,392,886) (7,306,368) 108,339 (77,670) 193,500 (32,220) (255,479) (996,400) 2,704,037 4,380,199 679,762 2,704,037 3,700,437 $ 2,579,901 $ 2,448,558 $ 2,704,037 (See accompanying notes) 6 CORPORATION OF THE MUNICIPALITY OF TWEED CONSOLIDATED STATEMENT OF CASH FLOWS YEAR ENDED DECEMBER 31, 2011 2011 2010 Actual Actual OPERATING Annual surplus $ 69,640 $ 4,442,118 Non -cash charges to operations: Amortization 1,875, 818 1,867,850 Gain on sale of tangible capital asset (77,670) - Waste disposal closure 261,800 - Changes in: Taxes receivable (7,453) 49,441 Accounts receivable 1,443,584 (1,143,562) Inventory (32,220) - Long-term receivables (23,877) (5,251) Accounts payable and accrued liabilities (183,721) 249,804 Deferred revenue 26,748 (507.104) 3,352,649 4,953,296 CAPITAL Acquisition of tangible capital assets Proceeds on sale of tangible capital asset (2,284,547) (7,306,368) 193,500 (2,091,047) (7,306,368) FINANCING Proceeds from long-term debt 50,000 23,000 Repayment of long-term debt (11,224) (22,611) 38,776 389 NET CHANGE IN CASH AND EQUIVALENTS 1,300,378 (2,352,683) CASH AND CASH EQUIVALENTS, beginning of year 645,167 2,997,850 CASH AND CASH EQUIVALENTS, end of year $ 1,945,545 $ 645,167 (See accompanying notes) CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 The Corporation of the Municipality of Tweed is a municipality in the Province of Ontario and operated under the provisions of the Ontario Municipal Act. 1. SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements of the Corporation of the Municipality of Tweed are the representation of management prepared in accordance with accounting policies prescribed 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 Corporation are as follows: Reporting Entity The consolidated financial statements reflect the assets, liabilities, revenues, expenditures of the reporting entity. The reporting entity is comprised of all organizations and enterprises accountable for the administration of their financial affairs and resources to the Corporation and which are owned or controlled by the Corporation_ In addition to general government tax -supported operations, they include the following: The Corporation of the Municipality of Tweed Public Library Board Interdepartmental and organizational transactions and balances are eliminated. Accounting for County and School Board Transactions The assets, liabilities, revenues, and expenditures with respect to the operations of school boards and the County of Hastings are not reflected in these consolidated financial statements. Trust Funds Trust funds and their related operations administered by the Corporation are not reflected in these consolidated financial statements, but are reported separately on the "Trust Funds Balance Sheet and Statement of Continuity". Basis of Accounting Revenues and expenditures are reported on the accrual basis of accounting. 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 a receipt of goods or services and a creation of a legal obligation to pay. Deferred Revenue The Corporation receives contributionsunder the authority of provincial legislation and funding agencies. These funds, by their nature, are restricted in their use, and, until applied to applicable projects, are recorded as deferred revenue. Amounts applied to projects are recorded as revenue in the fiscal period in which they are expended. Reserves and Reserve Funds Certain amounts, as approved by Council, are set aside in reserves and reserve funds for future operating and capital expenditures_ Transfers to, or from, reserves and reserve funds are an adjustment to the respective fund when approved. CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 SIGNIFICANT ACCOUNTING POLICIES (continued) Government Transfers Government transfers are recognized as revenues or expenditures in the year that the events giving rise to the transfer occurred, provided the transfer is authorized, eligibility criteria, if any, have been met by the recipient, and a reasonable estimate of the amount can be made. Use of Estimates The preparation of consolidated financial statements in conformity with accounting policies for local governments, as recommended by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Management makes accounting estimates when determining the estimated useful life of the Corporation's tangible capital assets, its allowance for doubtful accounts, the carrying value of its inventory and solid waste landfill closure and post -closure costs. Actual results could differ from those estimates. Taxation and Related Revenues Property tax billings are prepared by the Corporation based on assessment rolls issued by the Municipal Property Assessment Corporation ("MPAC"). Tax rates are established annually by Council incorporating amounts to be raised for local services and amounts the Corporation is required to collect on behalf of Hastings County for general and library purposes and the Province of Ontario in respect of education taxes. Realty taxes are billed based on the assessment rolls provided by MPAC. Taxation revenues are recorded at the time tax billings are issued. A normal part of the assessment process is the issue of supplementary assessment rolls that provide updated information with respect to changes in property assessment. Once a supplementary assessment roll is received, the Corporation determines the taxes applicable and renders supplementary tax billings. Assessments and the related property taxes are subject to appeal. Any supplementary billing adjustments made necessary by the determination of such changes will be recognized in the fiscal year they are determined and the effect shared with the county and school boards as appropriate. Non :Financial Assets Non -financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year, and are not intended for sale in the ordinary course of operations. The change in non -financial assets during the year, together with the annual surplus or deficit, provides the Change in Net Financial Assets for the year. Tangible Capital Assets Tangible capital assets are recorded at cost, which includes all amounts that are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets is amortized on a straight-line basis over their estimated useful life as follows: 9 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 I. SIGNIFICANT ACCOUNTING POLICIES (continued) Tangible Capital Assets a) Asset Categories and Estimated Useful Land Buildings Vehicles Equipment Transportation Bridges and other structures Roads Sidewalks Waste and wastewater networks Underground networks Life - not amortized - 40 to 50 years - 5 to 10 years - 4 to 20 years - 20 to 75 years - 10 to 70 years - 40 years 50 years A full year of amortization is charged in the year of acquisition and none in the year of disposal. Assets under construction are not amortized until the asset is available for productive use, at which time the costs are transferred to the appropriate asset category. (b) Contribution of Tangible Capital Assets Tangible capital assets received as contributions are recorded at their fair value at the date of receipt and also are recorded as revenue. Similarly, transfer of assets to third parties are recorded as an expense equal to the net book value of the assets as of the date of transfer. Inventory of Supplies Inventory of supplies held for consumption are recorded at the lower of cost and replacement cost. 2. FINANCIAL INSTRUMENTS The Corporation's financial instruments consist of cash, taxes receivable, accounts receivable, long- term receivable, accounts payable and accrued liabilities and long-term debt. Unless otherwise noted, it is management's opinion that the Corporation is not exposed to significant interest rate, currency or credit risks arising from these financial instruments. 3. CASH The balance of cash consists of the following: Undesignated cash Designated under Federal gas tax agreement Designated under the Planning Act - Parkland 201. 2010 $ 1,758,817 $ 127,859 58,869 $ 1,945,545 $ 645,167 536,896 61,727 46 544 Cash received under the Federal Gas Tax agreement is restricted for expenditures on environmentally sustainable infrastructure. 10 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 3. CASH (continued) Cash raised under the Planning Act regarding Parkland is restricted for capital costs for the acquisition of land or othercapital expenditures for park or other recreational purposes. 4. LONG-TERM RECEIVABLE The balance of long-term receivable consists of the following: 2011 2010 MORTGAGE RECEIVABLE due January 15, 2018; repayable in monthly instalments of principal and interest in the amount of $857. Interest is calculated at the prime lending rate as established by the Bank of Montreal plus 1%. The mortgage is secured by the property located at 13 Bridgewater Road, Actinolite, Ontario $ - $ 22,480 Tile drainage and shore -line property assistance loans receivable 5. ACCRUED LIABILITY - WASTE DISPOSAL CLOSURE 75,963 29,606 $ 75,963 $ 52,086 The Ontario Environmental Protection Act sets out the regulatory requirements to properly close and maintain all active and inactive landfill sites. The estimated liability for these expenditures is recognized based on the cumulative capacity used to date, compared to the total estimated landfill capacity. Estimated total expenditures represent the sum of the future discounted cash flows for the closure and post -closure care discounted at 4% and using an assumed rate of 2% for inflation. The Corporation has two active and three closed landfill sites. For the closed sites, the estimated liability is recognized immediately. The estimated liability for the Marlbank and Hunt Road waste disposal sites is $561,800 based on the present value of closure and post -closure costs estimated at $3,712,000. The Marlbank Road Waste Disposal site has an estimated remaining capacity of 53% and is expected to provide capacity for 25 years based on current waste generation rates. The Hunt Road Waste Disposal site was closed to use by the public, but will remain open to dispose of waste by the Municipality until filled, has an estimated remaining capacity of 30% and is expected to provide capacity for 45 years based on current waste generation rates. A reserve of $733,258 has been established to provide for this liability and is reported in schedule 2 to the financial statements. Post -closure care is estimated to continue for a period of approximately 25 years. CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 6. DEFERRED REVENUE Balance Balance December 31, Transferred to December 31, 2010 Additions income 2011 Obligatory Reserve Funds: Federal gas tax $ 61,727 $ 345,107 $ 278,975 $ 127,859 Parkland 46,544 17,325 5,000 58,869 Other Government transfers - 12,678 - 12,678 Miscellaneous 5,609 - 5,609 Tweed Public Library 64,387 - 64,387 $ 178,267 $ 375,110 $ 348,362 $ 205,015 7, LONG-TERM DEBT The balance of long-term debt consists of the following: 2011 2010 Debentures $ 75,963 $ 29,606 Lien notes payable - Chrysler Financial and GMAC; repayable in monthly instalments of principal and interest of $2,214. Interest is calculated at rates of 0% - 1.9% and the notes are secured by specific automotive units. 7,581 $ 75,963 $ 37,187 Outstanding debentures of $75,963 (2010 - $29,606) are recoverable through special charges levied directly on ratepayers. Outstanding debentures have a maturity date of July 1, 2020, bearing interest at 6.6%. Principal repayments over the next five years are estimated to be as follows: 2012 $ 6,719 2013 7,122 2014 5,674 2015 8,003 2016 8,406 12 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 8. COMMITMENTS The Corporation has contracts committing it to payments in future years. The following agreements existed at December 31, 2011: At December 31, 2011 the Corporation has outstanding capital project contractual commitments of approximately $711,000.. An agreement with the Province of Ontario for policing services. Costs will be charged on the basis of services used. Base charges for the 2011 year were $802,044. An agreement with David Moore & Son for the collection of household waste to July 31, 2014. Base charges for the 2011 year were $32,000. An agreement with Quinte Waste Solutions for the collection of recycling. Base charges for the 2011 year were $41,260. An agreement with Ontario Clean Water Agency for the operating, maintaining and managing of the water and waste water systems to December 31, 2015. Base charges for the 2011 year were $251,850. Agreements with William Broek and Larry Palmateer for winter road maintenance to 2013 and 2015. 9. CONTINGENT LIABILITIES In the course of its business, the Corporation becomes involved in various claims and legal proceedings. Litigation is subject to many uncertainties and the outcome of individual matters is not predictable. An estimate of the contingency cannot be made since the outcome of these matters cannot be determined at this time. The Corporation carries liability insurance. Any settlement in excess of amounts which have been recorded in the accounts and insurance coverage will be accounted for as a current transaction in the year of settlement. Contingent environmental liabilties may arise out of existing and former operations. Such liabilities are different from environmental remediation and solid waste landfill closure and post -closure care liabilities because the liabilities are not determinable, the conditions which may give rise to the expenditures are uncertain, and the future expectations of the applicable regulatory authorities are not known. Potential costs that may arise in connection which such liabilities are not included in our provisions until the source and nature of the obligation becomes clear and is reasonably estimable. 13 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 10. OPERATIONS OF SCHOOL BOARDS AND THE COUNTY OF HASTINGS Further to note 1, the taxation, other revenues and expenditures of school boards and the County of Hastings are comprised of the following: Taxation $ Taxation from other governments Amounts received or receivable Requisition 11. ACCUMULA'1`ED SURPLUS 2011 School Boards 1,290,240 $ 4,712 1,294,952 1,294,952 County 2010 School Boards Count 1,347,482 $ 1,253,003 $ 1,336,232 10,949 5,143 10,094 1,358,431 1,258,146 1,346,326 1,358,431 1,258,146 1,346,326 $ $ The accumulated surplus position is comprised of the following: Equity in tangible capital assets Less: related debt Reserves and reserve funds - schedule 2 Amounts to be recovered Landfill closure and post closure costs Unrestricted surplus (deficit) Municipality of Tweed Municipality of Tweed Public Library Board 2011 2010 $ 26,650,522 $ 26,357,623 (7,581) 26,650,522 26,350,042 2,797,462 2,615,906 (561,800) (300,000) 223,497 378,128 21,619 17,584 $ 29,131,300 $ 29,061,660 14 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 12. SEGMENTED INFORMATION Municipal services are provided by departments Certain departments that have been separately disclosed in the segmented information along with the services they provide are as follows: General Government General government is comprised of council, chief administrative office (CAO/Clerk) department, and Treasury department. A municipal council is the ultimate authority, subject to provincial law, for all actions taken on behalf of the municipal corporation in that it exercises both executive and legislative roles. It fulfills its role by making policies in accordance with the wishes and concerns of the general public, subject to provincial laws, policies and directives. Council plays a managerial role by monitoring ongoing administrative performance and ensuring the best care of resources. The CAO/Clerk is responsible to municipal council for the general control and management of the affairs of the municipality as prescribed by municipal council. The CAO/Clerk, as head of the corporation's civic administration, provides leadership and direction to the Senior Management team, co-ordinates the administrative functions of the Corporation and exercises general management and control of Municipal operations. The CAO/Clerk ensures coordinated responsive services are delivered to the Municipality's residents and businesses in accordance with the approved policies and directions along with providing the following services: birth and death registrations, marriage, lottery and taxi licensing, commissioning oaths, Municipal by-laws and minutes. The Treasury department is responsible for the administration of taxes, accounts payable and receivable, financial statements and all other financial information and reporting for the Municipality. Protection to Persons and Property Protection to persons and property is comprised of police services, fire services, and by-Iaw enforcement. Police services are provided by the Ontario Provincial Police whose mandate is the safety of lives and property of citizens to, preserve peace and good order, prevent crimes from occurring, detect offenders and enforce the law. Fire Services are provided to the Municipality by volunteer firefighters. By-law enforcement is committed to serve, protect and provide a desired quality of life for citizens and visitors to the Municipality through education to raise awareness of community standards, and enforcement of Municipal by-laws to ensure timely compliance with a professional, unbiased approach. Transportation Services The publicworks department is responsible for the delivery of municipal public works services related to the planning, development and maintenance of roadway systems, storm water management and street lighting. Environmental Services The Municipality contracts with Dave Moore & Sons for the collection and disposal of household and commercial solid waste within the village of Tweed. The Municipality contracts with Quinte Waste Solutions for the collection of household recycling. The Municipality owns and operates two landfill sites within the Municipal limits. The Municipality contracts with Ontario Clean Water Agency for the management of municipal drinking water and sanitary sewer systems_ 15 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 12. SEGMENTED INFORMATION (continued) Recreation and Cultural Services The Parks and Recreation department is a social service with its purpose: to assist individual and community development to enhance social functioning and to improve the quality of life. The Parks and Recreation department provides accessible recreational programs including aquatics, minor ball and skating and operates Municipal facilities, including community halls, arenas, parks, ball diamonds and soccer fields. Planning and Development The Municipality of Tweed, the Township of Stirling-Rawdon, the Town of Deseronto and the Township of Tyendinaga have entered into an agreement for joint building services. The joint building services agreement came into effect April 1, 2005. Building services is responsible for all economic development, building and planning matters, including the issuance of building permits, land severance and minor variance applications, applications for official plan amendments and zoning by-law amendments, site plan control and subdivision matters and property standards inspections. Tweed Public Library Tweed Public Library contributes towards the information needs of the Municipality's citizens through the provision of library services. 13. PENSION AGREEMENTS The Corporation makes contributions to the Ontario Municipal Employees Retirement Fund (OMERS), which is a multi -employer plan, on behalf 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 rate of pay. Employees and employers contribute jointly to the plan. Contributions for employees with a normal retirement age of 65 were being made at a rate of 7.4 % (2010 - 6.4%) for earnings up to the annual maximum pensionable earnings of $48,300 (2010 - $47,200) and at a rate of 10.7% (2010 - 9.7%) for earnings greater than the annual maximum pensionable earnings. Contributions for employees with a normal retirement age of 60 were being made at a rate of 8.9% (2010 - 7.9%) for earnings up to the annual maximum pensionable earnings of $8,300 (2010 - $47,200) and at a rate of 14.1% (2010 - 13.1%) for earnings greater than the annual maximum pensionable earnings. The amount contributed to OMERS for 2011 was $64,442 (2010 - $50,872) for current service and is included as an expenditure on the "Consolidated Statement of Financial Operations". The actuarial valTiation of the OMERS plan at December 31, 2011 indicated a deficit in the plan. Because OMERS is a multi -employer plan, any pension plan surpluses or deficits are a joint responsibility of Ontario Municipal organization and their employees_ As a result, the Corporation does not recognize any share of the OMERS pension surplus or deficit. 16 CORPORATION OF THE MUNICIPALITY OF TWEED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS YEAR ENDED DECEMBER 31, 2011 14. BUDGET FIGURES Budgets established by the Corporation are based on a project oriented basis, the costs of which may be carried out over one or more years. Although they are not directly comparable with current year actual amounts, budget figures have been reflected on the "Consolidated Statement of Operations" and the "Consolidated Statement of Change in Net Financial Assets". Budget figures have been reclassified for the purpose of these financial statements to conform with PSAB reporting requirements. 15. COMPARATIVE FIGURES Certain comparative figures for 2010 have been reclassified to conform to the financial statements presentation adopted for 2011. 16. PRIOR PERIOD ADJUSTMENTS Certain funds, the use of which is restricted by legislation, previously accounted for in the reserve funds have been restated as deferred revenue to more appropriately reflect the restrictions imposed over the use of these funds. This change was accounted for retroactively with restatement of prior year. The effect of these changes on the 2010 comparative figures are as follows: Previously Balance as Reported Clan Restated Financial statement item Consolidated statement of financial position Deferred revenue $ 69,396 $ 108,271 $ 178,267 Accumulated surplus 29,169,931 (108,271) 29,061,660 Consolidated statement of operations and accumulated surplus REVENUE Grants 2,280,303 (317,837) 1,962,466 Interest income 47,994 (24,818) 23,176 Other 81,898 (30,529 51,369 OTHER INCOME AND EXPENSES RELATED TO CAPITAL Government transfer: Canada 1,777,608 924,015 2,701,623 INTEREST EARNED ON RESERVE FUNDS 20,660 20,660 17 COR POR ATION OF T HE MUNICIPALITY OF TWEED SC HEDULE I- CONSOLIDATED STATEMENT Of TAN0191.E CAPITAL ASSETS DECEMBER 31,2011 GENERAL INFRASTRUCTURE TOTALS Assess Pla nta Underground Brill}roe Under and a nd 016nr and 0r9nr hail BllIldina4 Vahicl4S Euulaniem thcr Cunsinreiina Fee911 e1. $n5ds Nelwmks I ntcwss C OST Belemrc, begbu tlug a ryrrr 5 1 .680.098 F 3 ,727,082 5 2,153 ,191 S 1,224,I97 5 301,753 2 109.330 2 2.651.757 5 18.582.043 5 4.748 .641 5 7 .989 .535 S 42,865,616 Additions during yea‘ 5,000 195,289 566,023 175,620 24,302 79,927 1,147,859 193,966 2.392 .886 Disposals during year 95-922 208,228 2,250 1,000 109.339 646 .263 I.152,602 Balance, mid of year 1,685,090 33126,449 2,420,986 1,797.567 225,055 79 .927 2,651 ,733 11,983,639 4,748,641 8,187.401 44,106,500 ACC UMULATED A MO RTIZA TION Oaiaucn . beginnin8 of year 24,235 897,093 3,165 ,828 531,518 81,683 Amoriira iion dutlag year 24,485 91,862 262.040 74,557 28.797 Auvmolnicnl a nion lust Ion on disposal& 92,585 177,798 1,278 667 %olanrx, end of ye ar 48.720 896,370 I,190,079 604,797 109,813 Net Doak Value orTan glbla Copltal Assarn 951,241 88 .391 !,039,632 10.487.241 814,919 1,634,275 16,507.993 I,140,614 89 ,713 136,359 1,875,818 655,505 927,853 10,992,350 903,632 1 ,770,594 17,455,978 5 1,636,578 5 2930.279 5 !.230 .916 5 792,770 S 115142 $ 19.927 5 1,617.155 5 7.991.289 5 7.845.409 5 6.416,807 F 26,65{122 December 31, 2010 UENERAL INFRASTRl1C 11RE TOTALS Assns Plans Undergr ound Bridget U nder and and Oiher p ad Oiher 5,M11 Duiliiaag Vahicies B801882oo1 Olhel C oi lsireeilpE F acllitico Ruud& Na1wur1g6 $lm4urns 31110 CO ST Bola nrx, bcglmiug o iycar $ 1,298,268 5 2,375,416 $ 2, 132,896 $ 1,185,219 S - 175,004 $ 3.344 $ 2 ,631,737 $ 16 .109,900 5 3,214,605 S 7,173,1810 S 36,519,369 Addilion a durng year 781,830 1,422,724 149,789 71,153 45.499 108,339 - 2,716,182 1,556 .619 960977 7,309 .712 Disposals during year - 730,658 129,494 32,175 15,750 3,544 523,939 22,663 5,442 963445 Balanuc, and of yanr ACCUMULAT ED AMORTIZATION Balance, beginning of par Amunizeliou during year gaumulnla4 antaoRallnu no dfapasnls Balmico, curl '(year Nal Book Value of Tangible Capllul .shale 1,690,098 3,727, 092 2,153,191 1.224. 197 201,733 108,339 2,651,737 10,342,047 4.748.641 7,988,535 42,865.616 1.932,636 1,126,347 24,233 93.115 168.973 250,658 129,494 24,235 897,093 1,165.828 .5 1,655,863 491.389 70,754 - 662,850 9,758,024 748,969 1,308.595 15,6181,264 72.304 26,679 - 88,301 1.175,356 88.713 131,082 1,861,850 32, 175 15.750 523,939 22,663 5.442 960 .121 531,516 81,683 951.241 10.407 .241 014.919 1,634.255 16,501.993 5 2.129. 989 5 997,263 5 692.679 5 124070 $ 108,359 S 1,700.496 5 7.974.802 5 3,933.722 $ 6.354 306 76.357.623 CORPOR ATION OF T HE MUNICIPALITY OF TWEED SCHE DULE 2 - CONS OLIDATED SC HEDULE OF C ONTIN UITY OF RESERVES AND RESERVE FUN DS December 31, 2011 Revenue Contributio ns Tra nsfers Bala nce, Interest on begin ning Reserve From of year Funds Operations Total To Balance, To Capital E nd of Operations Acquisitions Total Year Reserve Funds Waste Site reclamation $ 726,137 $ 20,952 $ 123,169 $ 870,258 125,460 $ 11,540 $ 137,000 $ 733,258 R oads 66,164 1,350 7,283 74,797 - 74,797 Village infrastr uctu re 170,498 1,446 - 171,944 9,600 9,600 162,344 962,799 23,748 130,452 1,116,999 125,460 21,140 146,600 970,399 R eserves Wo rking capital 530,999 530,999 Con tingencies 150,000 - 150,000 Water and sewer 343,000 - 106,300 449,300 Mun icipal building ex penditure 12,321 20,000 32,321 Capital acquisitions - Fire 58,300 65,000 123,300 Capital acquisitions - Arena 13,800 2,500 16,300 Arena - Roof 50,000 50,000 Fire - Overage Wages 15,000 15,000 Fire - Equ ipmen t Mainten an ce 20,000 - 20,000 Heritage 30,000 20,000 50,000 Hamle ts 11,620 13,100 24,720 Parks 10,400 5,000 15,400 Public works - OJT Ove rage - 15,000 15,000 Public works - Equipment 210,500 168,577 379,077 Public works - Winter Main tenance 50,000 78,000 128,000 Pu blic works - Bridges 212,167 50,000 262,167 12,000 140,300 140 ,300 390,699 150,000 449,300 12,321 12,321 20,000 58,300 58,300 65,000 16,300 11,700 11,700 38,300 12,000 3,000 20,000 50,000 24,720 11,700 11,700 3,700 15,000 158,700 158,700 220,377 128,000 29,500 29,500 232,667 1,653,107 608, 477 2,261,584 12,000 422,521 434,521 1,827,063 Total $ 2,615,906 $ 23,748 $ 738, 929 $ 3,378,583 $ 137,460 $ 443,661 $ 581,121 $ 2,797,462 CORPORATION OF THE MUNICIPALITY OF TWEED SCHEDULE 3 - CONSOLIDATED SCHEDULE OF SEGMENT DISCL OSURE STATE MENT OF OPERATIONS DECEMBER 31, 2011 BUDGET GENERAL PR OTECTION TANSPORT ATION ENVIROMENTAL RECREATION AND PLANNING AND TWEED PUBLIC ELI MINATIONS C ONSOLIDATED GOVERNMENT SERVICES SERVICES SERVICES CULTURAL DEVELOPMENT LIBRARY SERVICES BOARD REVENUES MunicipalTaxatlon $ (555,900) $ 832,826 $ 1,792,383 $ 32,640 $ 268,291 $ 97,950 $ $ $ 2,566,220 Ta xation from Other governments 24,600 - 24,800 Government Transfe rs Government of Ca nada - - - 1,000 923 1,923 Province 01 Ontario 1,479,100 209,800 - 40,000 58,320 15,951 - 1,801,171 O ther MunicIpalities - - - - 96,423 (98,423) User charges 15,000 5,000 20,000 -601,500 124,000 2,400 3,094 771,794 Investment Income 5,500 - 5,500 Penalty an d Interest on taxes 122,000 r 122,000 Develo pment charges - - . - Donations - - 32,000 . 4,600 36,600 Miscellaneous 41,000 6,500 - 3,400 4,500 55,400 1,131,300 1,154,126 1,812,383 874,140 479,611 103,780 125291 (96,423) 5,385,206 CURRENT -EXPENDITURES Salaries wages and employee benefits 399,700 132,985 673,850 • 190,350 208,440 Interest on long-term debt - - - Materials and Supplies 235,925 93,985 686,120 168,847 181,478 Contracted services and general services 708,700 169,000 319,863 Rents and Flnanclal Expenses 52,300 Exte rnai Transfers 44,180 96,500 Amortization - 24,166 72,955 1,449,768 200,373 82,412 712,111 1,130,805 3,178,738 879,533 588,830 $ 419,189 $ 23,321 $ 51,366,355 $ (205,393 $ (87,219) $_ 33,620 2,400 60,660 7,200 103,780 90,258 35,833 46,247 172,338 $ (46,047) $ 1,727,203 2,400 1,662,748 1,275,663 59,500 (96,423) 44,257 1,875,941 (96 ,423) 6,647,712 - $ (1262,504) CORPORATION OF THE MUNICIPALITY OF TWEED SCHEDULE 3 - CONSOLIDATED SCHEDULE OF SEGMENT DISCLOSURE STATE MENT OF OPERATIONS DECEMBER 31, 2011 ACTUAL GENERAL PROTECTION TANSPORTATION ENVIROMENTAL RECREATION AND PLANNING AND TWEED PUBLIC ELIMINATIONS CONSOLIDATED GOVERNMENT SERVICES SERVICES SERVICES CULTURAL DEVELOPMENT LIBRARY SERVICES BOARD REVENUES Municipal taxation $ (577,966) 3 932,826 3 1,792,225 $ 31,790 $ 288,291 $ 97,980 $ $ $, 2,543,146 Ta xation from other govemmenls 21,259 - - - 21,253 Go vernment Transfers Government of Canada 798 - - 1,200 - 11,080 13,878 Province of Ontario L479,150 213,612 40,000 51,236 8,296 83,030 - 1,875 ,328 Other municipalities - - - - 96,277 (96,277) User charges 13,090 10,570 21,135 704,018 125,880 - 7,184 081,857 Investment Income 8,111 - - - - 1,794 - 9,905 Penalty and Interest on taxes 137,335 - - - - - 137,335 Donations - - - - - 18,511 - 16,911 Miscellaneous 39,716 532 - - 25,855 11,200 14,168 91,471 1,121,493 1,157,540 1,013,360 775,608 470,442 119,272 229,450 (96,277) 5,591,088 CURRENT -EXPENDITURES Salaries wages and employee benefits 416,441 145,825 686,681 191,617 211,045 20,763 93,517 1,785,889 Interest on long-term debt 1,734 1,794 Materials and Supplies 275,108 83,914 863,280 570,913 191,481 43,803 26,415 2,044,912 Contracted services and gene ral services 802,044 201,203 312,815 - - - 1,316,062 Rents and Financial Expenses 91,914 - - - 7,200 - 99,114 Ex ternal Transfers - 44,154 - - 98,277 - (98,277) 44,154 Amortization 24,186 72,955 1,449,645 200,373 82,412 • 46,247 - 1,878,818 807,847 1,148,892 3,190,808 1,275,718 581,215 73,660 186;179 (96,277) 7,147,743 $ 313,846 $ 8,648 $ (1,377,4491 $ (499,910) $ LI1D,773) 3 45,712 $ 63,271 $ - $ (1,558,655) CORPORATION OF THE MUNICIPALITY OF TWEED SCHEDULE 3 • CONSOLIDATED SEGME NTED STATE MENT OF OPERATIONS DECEMBER 31,2010 ACTUAL GENERAL PROTECTION TANSP ORTATION ENVIR OMENTAL RECREATION AND PLANNING AND TWEED PUBLIC ELIMINATIONS CONSOLIDATED GOVERNMENT SERVICES SERVICES SERVICES CULTURAL DEVELOPMENT LIBRARY SERVICES BOARD REVENUES Munlcfpal taxation $ (551,799) $ 932,826 $ 1,792,225 $ 31,790 $ 266,291 5 97,980 $ $ $ 2,569,313 Taxation from other governments 24,901 - - - 24,901 Government Transfers Govern ment of Cana da (6,861) - 1,000 1,232 - 6,529 Province of Ontario 1,539,000 154,300 40,000 204,027 31,788 1,969,099 O ther municipalities - 73,440 (73,440) - User charges 15,390 12,235 23,311 702,811 152,833 922 (6,000) 901,302 Investment Income 22,276 - - 569 331 - 23,176 Penalty and Interest on taxes 127,332 - 127,332 Donations - 2,719 2,719 MEscellaneoua 28,290 6,797 - - 25 - 13,538 48,050 1,196,529 1,106,158 1,815,530 774,401 624,176 98,549 1233950 (79,440) 5,659,859 CURRENT -EXPENDITURES Salaries wages and employee benefits 399,024 149,603 658,893 184,067 186,509 30,394 83,730 1,689,220 Interest on long-term debt 569 569 Mate rials and Supplies 278,203 90,039 656,073 278,121 219,563 34,750 9,466 1,766,214 Cantradedservvices and gene ral se rvices 809,855 150,473 323,278 1,289,604 Rents and Financial Expenses - 7,200 6,000 (0,000) 7,200 Extemal Transfers 40,355 - - 73,440 - - (73,440) 40,355 Amortization 21,107 63,858 1,459,095 • 199,720 84,517 - 39,553 - 1,867,050 698,334 1,162,710 3,128,534 985,184 564,029 72,913 136,746 (79,4402_ 6,661,012 498,195 $ (46,552) $ 312,998]__$ (210,783) $ 60,147 $ 26,636 $ (14,798) $ CORPORATION OF THE MUNICIPALITY OF T WEED SCHEDULE 4 - CONSOLIDATED SCHEDULE OF RE CONCILATION OF FINANICAL PLAN TO THE BUDGET YEAR ENDED DECEMBER 31,2011 TANGIBLE TWEED CAPTIAL PUBLIC OPERATING CAPITAL RESERVES AND ASSET LIBRARY • BUDGET BUDGET RESERVE FUNDS ADJUST MENTS BOARD REVENUES Mu nicipal Taxa tion $ 2,566,220 $ $ $ $ Taxation from other governments 24,000 Gove rnment verniers Canada 346,400 (344,400) 923 Ontario 1,786.220 15,951 Other Municipal 96,423 User fees a nd sale of goods and services 767,900 - 2,880 Investment income 5,500 - - Penalty and Interest on taxes - 122,000 Donations 32,000 4,600 Miscellaneous 60,900 - 5,514 5,699,740 $ PSA6 ELIMINATI ONS BUD GET $ 2,566,220 24,600 1,923 1,801,171 (96,423) 770,780 8,600 122,000 38,600 58,414 344,400 128,291 (96,423) 5,385,208 EXPENDITURES Current G eneral gov ernment 887,925 24,180 712,111 Protection services 1,057,850 - 72,955 1,130,805 Transportation service s 1,738,211 1,440,527 3,178,736 En vironmonta€ services 679,161 - 200,372 - - 879,533 Recreation and cultural services 464,418 82,412 172,338 (96 ,423) 642,745 Planning and development 103,780 - - - - 103,780 Capital General government 162,000 (162,000) Protection services 117,440 - (117,440) Tran sportation services 1,985,300 (1,985,300) - - Envlronmentaf services 203,000 (293,000) Recreation and cultural services 136,200 (135,200) 4,751,345 2,693,940 (873,488) 172,338 (96,423) 6,647,712 NET REVENUES (EXPENDITURES) OTHER INCOME AND EXPENSES RELA TED TO CAPITA L Mu nicpal taxation Govern ment transfers Canada Ontario O ther Donation s FINANCING AND TRANSFERS Debt repayment Benefiting landow ners principal repayments Transfers from (to) other funds 948,395 (2,893,840) - 344,400 873,488 48,047 (1,262,604) (11,224) 1,848 - (1,848) (939,019) 1,137,450 (198,431) (948,395) 1,137,450 (196,431) 9,376 845,290 845,890 355,300 336,000 - 691,300 355,300 1,666490 336,000 11,224 355,300 1,892,490 ANNUAL SURPLUS (DEFICIT) $ $ $ (208,831) $ 882,864 $ 446,,47 $ $ ' 629,986