HomeMy Public PortalAbout2016 Financial StatementsCORPORATION OF THE MUNICIPALITY OF TWEED
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2016
Welch LLP'
CORPORATION OF THE MUNICIPALITY OF TWEED
FINANCIAL STATEMENTS
DECEMBER 31, 2016
Management's Responsibility for the Consolidated Financial Statements
Independent Auditor's Report
Consolidated Statement of Financial Position
Consolidated Statement of Operations and Accumulated Surplus
Consolidated Statement of Change in Net Financial Assets
Consolidated Statement of Cash Flows
Notes to Consolidated Financial Statements
Schedule I - Consolidated Statement of Tangible Capital Assets
Schedule 2 - Consolidated Statement of Continuity of Reserves and Reserve Funds
Schedule 3 - Consolidated Schedule of Segment Disclosure Statement of Operations
Schedule 4 - Consolidated Schedule of Reconciliation of Financial Plan to the Budget
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19
20-22
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Trust Funds:
Management's Responsibility for the Trust Fund Financial Statements
Independent Auditor's Report
Statement of Financial Position
Statement of Continuity
Notes to Financial Statements
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The Corporation of the
MUNICIPALITY OF TWEED
255MetcalfSt.. Postal Bag 729
T~eed. ON K0K 3J0
Te1.:(613)478-2535
Fax:(613)478-6457
Emai[: in fora~twp.tweed.on.ca
Website: wv,\~.tweed.ca
facebook.com/lweedontario
Management's Responsibility for the Consolidated Financial Statements
The consolidated financial statemeuts 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
Chartered Professional Accountants of Canada. A summary of the significant accounting policies are
described in Note I 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 canuot 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 requirements, 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.
Municipal Council is responsible t'or 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 exa~nination
and their opinion on the Corporation's consolidated financial statements.
Jo-~¢nne Ali~ert ....
Mayor
Betty Gal~agher
CAO/Clerk-Treasurer -~"
Welch LLP
To the Members of Council,
of the CORPORATION OF THE MUNICIPALITY OF TWEED
We have audited the accompanying consolidated financial statements of CORPORATION OF THE
MUNICIPALITY OF TWEED, which comprise the consolidated statement of financial position at
December 31, 2016 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 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 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 consolidated 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 consolidated 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, consolidated the financial statements present fairly, in all material respects, the financial
position of CORPORATION OF THE MUNICIPALITY OF TWEED as at December 31, 2016 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
September 26, 2017
CHARTERED PROFESSIONAL ACCOUNTANTS
LICENSED PUBLIC ACCOUNTANTS
525 Dundas Street East. Belleville. ON KSN 1G4
T: 613 966 2844 F: 6~-3 966 2206 W: welcbllp.com
An Independent Member of BKR International
CORPORATION OF THE MUNICIPALITY OF TWEED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
DECEMBER 31, 2016
FINANCIAL ASSETS
Cash - note 3
Taxes receivable
Accounts receivable
Long-term receivable - note 4
2016 2015
$3,029,539 $4,176,140
1.005.900 930,583
766,715 272,296
28,616 46,569
4,830,770 5,425,588
LIABILITIES
Accounts payable and accrued liabilities
Accrued liability - Waste disposal closure - note 6
Deferred revenue - note 7
Long-term debt- note 8
NET FINANCIAL ASSETS
NON-FINANCIAL ASSETS
Tangible capital assets - note I, schedule 1
Inventories of supplies
Prepaid expenses
ACCUMULATED SURPLUS - note 9
Contingent liabilities - note 13
693,973 469,966
689.000 658.000
581.266 890.126
28,616 46,569
1,992,855 2,064,661
2,837,915 3,360,927
28,148,040 26,470.888
9,441 26,830
2,918 3,011
28,160,399 26,500,729
$ 30~9981314 $ 29~861,656
(See accompanying notes)
Welch
CORPORATION OF THE MUNICIPALITY OF TWEED
CONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED SURPLUS
YEAR ENDED DECEMBER 31, 2016
REVENUE
Municipal taxation
Taxation from other governments
Grants
User charges
Investment income
Penalties and interest on taxes
Other
EXPENDITURE
General government
Protection to persons and property
Transportation services
Environmental services
Recreation and cultural services
Planning and development
2016 2016 2015
Budget Actual Actual
(note 12)
3,449,915 $3,453,638 $2,933,291
21,960 21,639 21,270
1,872,782 1,909,778 1,800,034
804,106 913.683 1,069,408
22,900 20,877 20,440
138,000 135,284 140,614
72,63Q 138,985 154,033
6,382,293 6,593,884 6,139,090
827,675 928,910 888,792
1,586,822 1,575,772 1,381,200
3,432,700 3,457,184 3,018,462
1,133,444 1,159,456 1,119,998
912,342 922,893 889,041
166,710 171,523 l 82,065
8,059,693 8,215,738 7,479,558
NET REVENUE (EXPENDITURES)1,677,400)( 1,621,854)(t,340,468)
OTHER INCOME AND EXPENSES RELATED TO CAPITAL
Municipal taxation for capital purposes
Government transfers:
Canada
Ontario
Tangible capital assets gain
Donations
User charges - water and sewer
398,150 398,150 832,903
684,699 651,083 452,061
1,437,400 1,437.171
49,186
3,324 358,135
207,809 194,986
2,728,058 2,733,900 1,643,099
INTEREST EARNED ON RESERVE FUNDS 24,612 25,784
ANNUAL SURPLUS 1,050,658 1,136,658 328,415
ACCUMULATED SURPLUS, beginning of year 29,861,656 29,861,656 29,533,241
ACCUMULATED SURPLUS, end of year $301912~314 $ 30,9981314 $ 29~861,656
(See accompanying notes)
CORPORATION OF THE MUNICIPALITY OF TWEED
CONSOLIDATED STATEMENT OF CHANGE IN NET FINANCIAL ASSETS
YEAR ENDED DECEMBER 31, 2016
2016 2016 2015
~Actual Actual
(note 12)
ANNUAL SURPLUS $1,050,658 $1,136,658
Amortization of tangible capital assets 1,979,917 1,979,917
Acquisition of tangible capital assets (3,454,122)(3,401,317)
Changes in assets under construction (284,237)
Loss (Gain) on sale of tangible capital assets (49,186)
Proceeds on sale of tangible capital assets 77,671
Change in inventories of supplies 17,389
Change in prepaid expense 93
CHANGE IN NET ASSETS
NET FINANCIAL ASSETS, beginning of year
NET FINANCIAL ASSETS, end of year
(423,547)(523,012)
3,360,927 3,360,927
$219371380 $ 2~837~915
$ 328,415
1,814,807
(1,818,289)
(36,621)
33,025
(2,483)
318,854
3,042,073
$ 313601927
(See accompanying notes)
Welch I.LP
CORPORATION OF THE MUNICIPALITY OF TWEED
CONSOLIDATED STATEMENT OF CASH FLOWS
YEAR ENDED DECEMBER 31, 2016
OPERATING
Annual surplus
Non-cash charges to operations:
Amortization
Loss (Gain) on sale of tangible capital asset
Waste disposal closure
Changes in non-cash financial assets and liabilities:
Taxes receivable
Accounts receivable
Inventory
Prepaid expenses
Long-term receivable
Accounts payable and accrued liabilities
Deferred revenue
CAPITAL
Acquisition of tangible capital assets
Proceeds on sale of tangible capital assets
2016
$ 1,136,658
1,979,917
(49,186)
31,000
3,098,389
(75,317)
(494,419)
17,389
93
17,953
224,007
(3O8,860)
2,479,235
(3,685,554)
77,671
(3,607,883)
2015
$ 328,415
1,814,807
12,000
2,155,222
140,177
628,258
33,025
(2,483)
8,003
165,136
(39,914)
3,087,424
(1,854,910)
(1,854,910)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of long-term debt
NET CHANGE IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS, beginning of year
CASH AND CASH EQUIVALENTS, end of year
(17,953)
(1,146,601)
4,176,140
310291539
(8,003)
1,224,511
2,951,629
$ 4,176,140
(See accompanying notes)
Welch IA P
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
The Corporation of the Municipality of Tweed is a municipality in the Province of Ontario and
operates under the provisions of the Ontario Municipal Act.
I.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 Chartered Professional
Accountants of Canada. Significant aspects of the accounting policies adopted by the Corporation are
as follows:
Reporting Entity
The consolidated financial statements reflect the assets, liabilities, revenues and 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 schools 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 resuR of receipt of goods or services and a
creation of a legal obligation to pay.
Deferred Revenue
The Corporation receives contributions under 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.
Welch LLP
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
I.SIGNIFICANT ACCOUNTING POLICIES (continued)
Reserves and Reserve Funds
Certain amounts, as approved by Council, are set aside in reserves and reserve funds for future
operating and capital expenditures. Transfer to, or from, reserves and reserve funds are an adjustment
to the respective fund when approved.
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 Chartered Professional
Accountants of Canada requires management to muke 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 expenditures 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 assessments. Once a supplementary assessment roll is received, the Corporation
determines the taxes applicable and renders supplementary 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.
Welch
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
SIGNIFICANT ACCOUNTING POLICIES (continued)
Contaminated Sites Liability
Contaminated sites are a result of contamination being introduced into air, soil, water or sediment of a
chemical, organic or radioactive material or live organism that exceeds an environmental standard.
The liability is recorded net of any expected recoveries. A liability for remediation of a contaminated
site is recognized when, as at the financial repoaing date, atl of the following criteria are met for a site
or a portion of a site which is no longer in productive use:
~)
ii)
iii)
iv)
an environmental standard exists;
contamination exceeds environmental standard;
the Corporation is directly responsible or accepts responsibility: and
a reasonable estimate of the amount can be made.
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:
(a) Asset Categories and Estimated Useful Life
Land
Buildings
Vehicles
Equipment
Transportation
Bridges and other structures
Roads
Waste and wastewater networks
Underground networks
- not amortized
- 40 to 50 years
- 5 to 10 years
- 4 to 20 years
-20 to 75 years
-10 to 70 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.
Inventories of Supplies
Inventories of supplies held for consumption are recorded at the lower of cost and replacement cost.
¯../I0
Welch
CORPORATION OF TIlE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
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.
CASH
The balance of cash consists of the following:
Market Value 2016 2015
Undesignated cash
Petty cash and chequing accounts
Guaranteed Investment Certificates
Mutual and segregated funds
Tweed Public Library Board
Designated cash
Federal gas tax agreement - chequing account
Planning Act - Parkland - chequing account
1,731,000 $1,731,000 $2,642,326
113,201 113,201 105,358
578,449 613,619 599,685
38,955 38,955 24,994
2,461,605 2,496,775 3,372,363
475,028 475,028 745,780
57,836 57,736 57,997
532,864 532,764 803,777
$2,994,469 $ 3,029,539 $ 4,176,140
Cash received under the Federal Gas Tax agreement is restricted for expenditures on
environmentally sustainable infrastructure.
Cash raised under the Planning Act regarding Parkland is restricted for capital costs for the
acquisition of land or other capital expenditures for park or other recreational purposes.
LONG-TERM RECEIVABLE
The balance of long-term receivable consists of the following:
2016 2015
Tile drainage and shore-line prope~y assistance
loans receivable 28,616 $461569
BANK INDEBTEDNESS
The Corporation has an operating line of credit of $500,000 at an interest rate of prime plus .5% of
which $nil was utilized at year-end.
.../I 1
Welch
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
6.ACCRUED LIABILITY -WASTE DISPOSAL CLOSURE
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 iraraediately. The estimated liability for the Marlbank and Hunt Road waste
disposal sites is $689,000 based on the present value of closure and post-closure costs estimated at
$1,170,983
The Marlbank Road Waste Disposal site has an estimated remaining capacity of 45% and is expected
to provide capacity for 20 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 40 years based on current waste generation rates.
A reserve fund of $1,057,850 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.
DEFERRED REVENUE
The balance of deferred revenue consists of the following:
Balance Balance
December 31,Transferred to December 31,
2015 Additions income 2016
Obligatory Reserve Funds:
Federal gas tax
Parkland
Other
Government transfers 37,306
Miscellaneous 45,310
Tweed Public Library __3 7_.,.~33
$745,780 $365,148 $635,900 $475,028
57,997 4,704 4,966 57,735
15,182 22,124
420 23,600 22,130
4 900 4.384
¯../12
Welch
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
LONG-TERM DEBT
The balance of long-term debt consists of the following:
2016 2015
Debentures $28,616 $46,569
Outstanding debentures of $28,616 (2015 - $46,569) are recoverable through special charges levied
directly on ratepayers. Outstanding debentures have a maturity date of December 31, 2017 October 1,
2021, bearing interest at 6%.
Principal repayments over the next five years are estimated to be as follows:
2017 $5,076
2018 5,381
2019 5,704
2020 6,046
2021 6.409
ACCUMULATED SURPLUS
The accumulated surplus position is comprised of the following:
2016 2015
Equity in tangible capital assets
Reserves and reserve funds - schedule 2
Unfunded capital projects
Amounts to be recovered
Landfill closure and post-closure costs
Unrestricted surplus
Municipality of Tweed
Municipality of Tweed Public Library Board
$28,148,040 $26,470,888
3,166,801 3,791,489
(68.828)
(689,000)(658,000)
358,188 306,810
14,285 19~297
301998~314 $ 29,8611656
¯../13
Welch LEE
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
10.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, comnussioning 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-law
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. The Municipality of Tweed and the Township of Stirling-Rawdon have entered
into an agreement for joint fire department administration services which came into effect in 2016.
The By-law enforcement is comnutted 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-taws to ensure timely compliance with a professional, unbiased
approach.
Transportation Services
The public works 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 with 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.
¯. ¯/14
Welch LLP
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
10.SEGMENTED INFORMATION (continued)
Recreation and Cultural Services
The Parks and Recreation department is a social service whose purpose is 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 the 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.
11.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 9.0%
(2015 - 9.0%) for earnings up to the annual maximum pensionable earnings of $54,900 (2015 -
$53,600) and at a rate of 14.6% (2015 - 14.6%) 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 9.2%
(2015 - 9.2%) for earnings up to the annual maximum pensionable earnings of $54,900 (2015 -
$53,600) and at a rate of 15.8% (2015 - 15.8%) for earnings greater than the annual maximum
pensionable earnings.
The amount contributed to OMERS for 2016 was $99,567 (2015 - $89,344) for current service and is
included as an expenditure on the "Consolidated Statement of Operations and Accumulated Surplus".
The actuarial valuation of the OMERS plan at December 31, 2016 indicated a deficit of
$2,341,000,000 (2015 - $5,259,000,000) in the plan. OMERS is a multi-employer plan, any pension
plan surplus or deficit are a joint responsibility of Ontario Municipal organizations and their
employees. As a result, the Corporation does not recognize any share of the OMERS pension surplus
or deficit in the consolidated financial statements.
Welch I~I~P'
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
12.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
Accumulated Surplus" 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.
13.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 liabilities 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 the
Corporation's consolidated statement of operations and accumulated surplus until the source and
nature of the obligation becomes clear and is reasonably estimable.
14.COMMITMENTS
The Corporation has contracts comnutting it to payments in future years. The following agreements
existed at December 31, 2016:
An agreement with the Province of Ontario for policing services. Costs will be charged on the basis of
services used. Base charges for the 2016 year were $1,075,163
An agreement with David Moore & Son for the collection of household waste. Base charges for the
2016 year were $34,272.
An agreement with Quinte Waste Solutions for the collection of recycling. Base charges for the 2016
year were $80,953.
An agreement with Ontario Clean Water Agency for the operating, maintaining and managing of the
water and waste water systems. Base charges for the 2016 year were $262,181.
Agreements with Larry Palmateer for winter road maintenance to 2017.
.../16
CORPORATION OF THE MUNICIPALITY OF TWEED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
15.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:
2016 2015
School School
Boards Count2 Boards Count~
Taxation $1,321,527
Taxation from other governments 5,609
Amounts received or receivable 1,327,136
Requisition 1,327,136
$1,593,596 $1,312,632 $1,537,208
12,621 5,422 12,452
1,606,217 1,318,054 1,549,660
1,606,217 1,318,054 1,549,660
. . ./17
Welch I.I.P
CORPORATION OF THE MUNICIPALITY OF TWEED
SCHEDULE 1 - CONSOLIDATED STATEMENT OF TANGIBLE CAPITAL ASSETS
YEAR ENDED DECEMBER 31, 2016
COST
Balance. beginning of year
Additions during the year
Disposals during the year
GENERAL INFRASTRUCTURE
Vehicles ~Oth¢~r Under Facilities Roads Nelworks
2,141~365 $ 4,029.564 $ 2,936,944 $1,181,831 $262.097 $36,621 $2,870,631 $ 21,495,795 $5,807,653
23,816 84,983 589,538 95,295 12.187 284,237 18,067 2,475,160 50,368
183 207 60 956 18 420 __1,0110.399 1 621
TOTALS
ACCUMULATED AMORTIZATION
Balance, beginning of year
Amordza6on during the year
Othe~r 201~6
Balance, end of year
51,903 3,685,554
1.264.603
2 165 181 4 114h547 3.343,275 1,216.170 255.804 320.858 2 888098 22 9711556 5~56 400 9 341~13 5 ~ ~ 3
198,134 1,286,743 1,899,222 580,416 152,389 1,425.036 14,152.233 1,589,275
72,999 105,951 218.300 92,551 22,701 103,932 1,092.990 119,460
164631 51 047 18420 1 (KIO 399 I 621
2,297,475 23,580,923
151,027 1,979,917
271.133 1,392.694 I 952 891 021 920 156 670 1,528.968 14,244.824 1 707 120 2.448.502 24.324.722
NelBookValueofTangibleCapitalAssets ~ ~ ~ ~ ~ 99.194 $ 320.858 $ 1359.730 $ 8.725.732 $ 4.149.280 6.892.711 $ 2gl48.0411
COST
Balance. beginning of )ear
Addi0ons during the year
Disposals during the year
ACCUMULATED AMORTIZATION
Balance, beginning of yem
Amortization during the year
Balance. end of year
Net Book Value of Tmlgible Capital Asscls
YEAR ENDED DECEMBER 31, 2015
GENERAL
Laud Buihlmg .Vehicles
INFRASTRUCTtJRE TOTALS
Assets Planl and and Other ~
Ot he_.._.~r Under Facilities Roads Networks Othe~r 201~5
$ 1,684.402 $ 3~998,780 $ 2.694.096 $
456,963 30.784 242.848
2A41 365 4,029.564 2.936,944
1,088,358 $259,678 $-$2,870,631 $20,592,049 $5,792.770 $9.310,487 S 48.291,257
156,744 12,327 36,621 903,746 14.877 1.854,910
63.271 9 908 21.177 94.356
1.181.831 262.097 30621 2870631 21495795 5,807.653 9,289310 50~151 811
127,516 1,187,542 1,717,035 560,224 139,412 1,322.911
70.618 9%201 182,187 83,463 22,885 102.125
63,271 9,908
198.134 I 286743 1.899222 580416 152389 IA25 036
13,163,217 1,472,963 2,169,652 21,860,472
989,016 116,312 149,000 1,814,807
21,177 94.356
14.152.233 1.589.275 2.297.47...__.~5 23.580.923
7.343.562 g 4.218.378 $6.991.835 S 26.4711.888
(See accompanying notes)
¯../18
Roads
Village intraswuclm~
CORPORATION OF THE MUNICIPALITY OF TWEED
SCHEDULE 2 - CONSOLIDATED SCHEDULE OF CONTINUITY OF RESERVES AND RESERVE FUNDS
DECEMBER 31, 2016
Balance, Interest on From Operations From Capital
beginning of year Reserve Funds
Total To Operatiolls To Capital Total Balance, end of
1,039~312 $22,070 $141.800 $$163,870 $145,332 $$145,332 $1,057,850
105.358 1,271 6,572 7,843 113,201
132,310 11271 12_~.71 5,957 5,957 127.624
11276.980 24.612 1481372 172.994 151.289 151.289 1.29g.675
Working capital
Contingencies
Water and sewer
Municipal building expenditure
Capitol acquisitions - Fire
Capital acquisitions - Arena
Arena - Building
Fire - Overage wages
Fire - Faluipment n~aintcnance
Fli~ - Fire hall - Bay lor EMS
Heritage
Hamlets
Parks
Public works - O/T overage
Public works - Equipnlent
Public works - Equipment Contingency
Public works ~ Winter maimenance
Public works. Bridges
Total
226,895
544,416
72,995
332,358
22.200
5,000
9,800
15,000
20,000
91,461
50,000
30,498
2.514.509
3.791,489 $24~612 S
45.b12 45,612
50,458 50,458
10.000 10.000
60,000 8,529 68.529
5,000 5,000
10,750 10,750
5,0~0 5,000
100,(RJO 31,688 131,688
20~000 20 000
261,208 __~347 037
409.580 $ 85829 ~ 520.021
15,214 65,505 80,719
138.096 13g,096
17,362 17,362
308,320 308,320
10,500
3.755
10,500
3,755
7,297 38,881 46,178
259.0{)0 259,000
14,490 14.490
115,000
191,788
150,000
456,778
65,633
92,567
27,200
5,000
9,800
4,500
151,766 841.654 993420 1,868,126
303,055 ~ 841,654 .~ 1.144,709
(See accontpanying notes)
¯../19
CORPORATION OF THE MUNICIPALITY OF TWEED
SCHEDULE 3 - CONSOLIDATED SCHEDULE OF SEGMENT DISCLOSURE STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2016
BUDGET
5544.225
15,0~10 2.000 625.791
26.700 2.0(KI 625.791
t.200 1.350
19.682
126.000
134+700 5.615
5.250
-5850 7.030
135 9t~8.750 164,927
CONSOLIDAT~c.D
2,550
1,870.232
775,200 218.040 235,900 77,300 112.773
---2,900
1,053,L85 31 L,35i 331,710 78,110 38,177
8,400
1.993.713
2.900
2.341.233
1,630.040
58.900
52.990
L.979.917
8.059.693
(See accompanying notes)
¯../20
CORPORATION OF THE MUNICIPALITY OF TWEED
SCHEDULE 3 - CONSOLIDATED SCHEDULE OF SEGMENT DISCLOSURE STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2016
ACTUAL
GENERAL PROTECTION TR&NSPORTATION ENVIRON~.IEN'I'AL RECREATION AND P[a~NNING TWEED PUBLIC ELD,IINATIONS
GOVERNNIENT SERVICES SERVICES SERVICES CULTURAL DEVELOPKIENT LIBRARY BOARD
SERVICES
$$$$$$$3,453,638
21.639
1.886.461
21915
18.423
152.09434.049 19,137 681,711
2,454
8.376 -2.529 6 283
42425 19 137 681 711 157.343 8.737
CONSOIADA 1 ED
$3,453,03g
1.419 2.619
20.698 -1.907.159
122.494
44,319
4.707.633 ~ H53334~1 }{3.4380471 $~4777451 ${680tJ85~ ~H62.786~ $137.4771S
2,154.925
2.454
2.329.432
55.148
8.215.738
(See accompanying notes)
¯..121
CORPORATION OF THE MUNICIPALITY OF TWEED
SCHEDULE 3 - CONSOLIDATED SCHEDULE OF SEGMENT DISCLOSURE STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2015
ACTUAL
2,933.291 $
21,270
20,838 IL932 t0,999 881,246 138,912
140,614
4.949.328 926~5 ! 0.999 881.246 144.271
$2,933,291
21,270
26A31 -1,790,930
5.481 1,0~9,408
3.274 20,440
6.378 6,378
5.885 5528 ~147.655
CURREN I - EXPIaNI)ITURES
Salimcs. wages aad en~flo~ce bct~eflts 474,397 135.770 746.542 215.907 229.387 81.827 118,578 2.002.408
Interest on long-term dgbt .....3.274 -3.274
Materials and supplies 348,287 165.488 805,750 321.405 313,963 88.564 41.062 2.084.519
Contracted ~et~,ices and general se~ices -9~4.683 149.830 356.161 1.470.674
(See accompanying notes)
¯../22
CORPORATION OF THE MUNICIPALITY OF TWEED
SCHEDULE 4 - CONSOLIDATED SCHEDULE OF RECONCILIATION OF FINANCIAL PLAN TO THE BUDGET
YEAR ENDED DECEMBER 31, 2016
6,343.30~6
3.449.915
21.960
1,350 2,550
19,682 -1.870,232
EXPENDITURES
NET REVENUES (EXPENHITURES)
OTHER INCOME AND EXPENSES RELATED TO
CAPITAL
C~mda
O~hcr
23.225
97582
1,434.315
149,130
827,675
1.586.822
3.432.700
912,342
166.710
308,0~
2.483,745
414.800
-158600
~054.826 3A4OI45
1,504,880
398.150
684,699
1.437,400
207.809
2.728.058
398,150
684.699
1.437,400
207.809
2.728058
712.087
8
(See accompanyb~g Jtoles)
¯../23
CORPORATION OF THE MUNICIPALITY OF
TWEED TRUST FUNDS
FINANCIAL STATEMENTS
December 31, 2016
Welch
The Corporation of the
MUNICIPALITY OF TWEED
255MetcalfSt.. Postal Bag 729
Y\~eed, ON K0K 3J0
Te1.:(613)478-2535
Fax:(613)478-6457
Email: in fo@t\s p.twccd.on.ca
Website: w\sss .tweed.ca
lhcebook.com/tweedonlario
Management's Responsibility for the Trust Fund Financial Statements
The Trust Fund financial statements of the Corporation of the Municipality of Tweed are the
responsibility of management and have been approved by Council.
The Trust Fund 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
Chartered Professional Accountants of Canada. A summary of the significant accounting policies are
described in Note 1 to the financial statements. The preparation of Trust Fund 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 requirements, and reliable financial information is available on a timely
basis for preparation of the Trust Fund financial statements. These systems are monitored and evaluated
by management.
Municipal Council is responsible for ensuring that management fulfills its responsibilities for financial
reporting. Council, through the Audit Committee, reviews the Corporation's Trust Fund financial
statements and discusses any significant financial reporting or internal control matters prior to Council
approval of the Trust Fund financial statements.
The Trust Fund 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 Trust Fund financial statements.
Jo-~nne Albert
Mayor
Bett' her ~.
CAO/Clerk-Treasurer -
25
Welch LLP
INDEPENDENT AUDITOR'S REPORT
To the Members of Council of the
Corporation of the Municipality of Tweed
We have audited the statement of financial position of the CORPORATION OF THE MUNICIPALITY
OF TWEED Trust Funds as at December 31, 2016 and the statement of continuity for the year then
ended, and a summary of significant accounting policies. These financial statements have been prepared
by management using the cash receipts and disbursements basis of accounting described in the notes to
financial statements.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in
accordance with the cash receipts and disbursements basis of accounting described in the notes to
financial statements; this includes determining that the cash receipts and disbursements basis of accounting
is an acceptable basis for the preparation of the financial statements in the circumstances, and for such
internal control as management determines is necessary to enable the presentation 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 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 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 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 financial statement.
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, these financial statements presents fairly, in all material respects, the cash receipts and
disbursements and financial position of the CORPORATION OF THE MUNICIPALITY OF TWEED
Trust Funds for the year ended December 31, 2016 in accordance with the cash receipts and
disbursements basis of accounting described in the notes to financial statements.
Belleville, Ontario
September 26, 2017
CHARTERED PROFESSIONAL ACCOUNTANTS
LICENSED PUBLIC ACCOUNTANTS
Welch LL!' Chartered Professional Accountants 26
CORPORATION OF THE MUNICIPALITY OF TWEED
TRUST FUNDS
STATEMENT OF FINANCIAL POSITION
DECEMBER 31, 2016
ASSETS
Cash
Investments
Recreation
Associations
$
10,057
$ 10,057
Santa
Claus
Parade
Fund
$ 1,058
Total
1,058
10,057
$ 1,058 $ 11,115
FUND BALANCE
Fund balances $ 10,057 $ 1,058 $ 11,115
(See accompanying notes)
27
Welch LLP'
CORPORATION OF THE MUNICIPALITY OF TWEED
TRUST FUNDS
STATEMENT OF CONTINUITY
YEAR ENDED DECEMBER 31, 2016
Santa
Claus
Recreation Parade
Associations Fund Total
FUND BALANCES, beginning of year $9,997 $1,658 $i1,655
RECEIPTS
Donations
Interest earned
1,000 1,000
60 60
60 1,000 1,060
1,600 1,600
EXPENDITURES
Parade expenses
FUND BALANCES, end of year $10,057 $ 1,058 $ 11,115
(See accompanying notes)
28
Welch LLP'
CORPORATION OF THE MUNICIPALITY OF TWEED
TRUST FUNDS
NOTES TO FINANCIAL STATEMENTS
YEAR ENDED DECEMBER 31, 2016
l.ACCOUNTING PRINCIPLES
Basis of Accounting
Capital receipts and income are reported on the cash basis of accounting.
Expenditures are reported on the cash basis of accounting with the exception of administrative
expenses which are reported on the accrual basis of accounting, which recognizes expenditures as
they are incurred and measurable as a result of the receipt of goods or services and the creation
of a legal obligation to pay.
Use of Estimates
The preparation of financial statements in conformity with Canadian public sector accounting
standards requires management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenditures during the period. Actual results
could differ from those estimates.
STATEMENT OF CASH FLOWS
A statement of cash flows has Not been included in these financial statements as the information
is readily determinable.
29
Welch ixm