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HomeMy WebLinkAboutThe Huron Expositor, 1986-06-18, Page 12M2, THE HURON EXPOSITOR, JUNE TOWN OF AUDITOR'STH REPORT NOTES TO THE NATES TO THE FINANCIAL • FINANCIAL STATEMENTS STATEMENTS CONT'D ,To the Memb^res' of Council, inhabitants end Ratepayers of the Corporation of the Town of Seaforth 14e have examined the conaolidated balance sheet of the Corporation of the .'gown of Seaforth as at December 31, 1985 and the consolidated statement of • operations for the year than ended. Our examination was made in accordance ,with generally accepted auditing standards, and accordingly included ouch tests and other procedures as we considered necessary in the circumstances. In our opinion, these consolidated financial atatemente present fairly the financial position of the Corporation of the Town of Seaforth an at December . 31, 1985 and the results of its operations for the year then ended in accordance with the accounting principles prescribed for Ontario Municipalities applied on a basis cons locant with that of the pteceding year. Chartered Accountants February y 21, 1 1986. London, Ontario Licence No. 1239 F CONSOLIDATED BALANCE SHEET as at December 31, 1985 1985 ,1984 ASSETS Unrestricted Cash 'Taxes receivable Accounts receivable Other current aaeete $107,937 5 38,540 75,344 78,573 79,610 90,552 927 45 263,818 207,710 Restricted Cash Accounts receivable Due from revenue fund Long-term receivables 64,679 90,427 368 6,775 1,319 1,560 43,064 66.366 .141.826 December 31, 1985 1. Accounting Policies (a) Baeia of Consolidation (i) Consolidated Balance Sheet Thin statement reflects the assets and liabilities ,of the revenue fund, reserve funds, the capital fund and includes the activities of all coomitteee of Council and the Danforth Business Improvement Area Board of Management which le under the control of Council. All interfund assets and liabilities are eliminated with -the exception of loans and odvance0 between the reserve funds and other funds of the Town. (1L) Consolidated Statement of Operations This statement 'reflects the consolidated sources of financing and expenditures of the revenue fund, reserves, reserve funds and the capital fund of the Town and the Seaforth Business Improvement Area Board of Management. All interfund sources of financing and expenditures are eliminated with the exception of interest' income and expellee arising from loans and advances between the reserve funds and other funds of the Team. (141) Non -consolidated Entities For those local boards, municipal enterprises and utilities of the municipality which are not consolidated, the "Consolidated Balance Sheet" does not reflect their assets or liabilities except to the extent of amounts due to or from those entities. The "Consolidated Statement of Operations" does not reflect their revenues and expenditures except to the extent of the Town's contribution to those entities. Those entitles which are not consolidated are as followo: (d) Total reported' on thea"the year Consolidatedrnet lonterm Statement of Operations"earehaeh are follows: Capital outlay financed by long-term liabilities and to be recovered 1n future yearn (Note 4) 12.000 23 000 $342,184 $372,536 LIABILITIES Bank indebtedness Announce payable and accrued nobilities $ 156 $ 21,560 108,627 75,959 108,783 97,519 Not long -teem liabilities (Note 4) 12,000 23,000 FUND BAI.ANCBS AT THE END OF THE YEAR (Note 5) To be used to offoet (or to be recovered from) taxation or user charges (Note 5) Reserves (Nota 6) Rests. funds (Noce 6) 46,325 1,481 108,710 108.710 66.366 141.826 $342,184 5372,536 - Seaforth and District Community Centres Management Committee - Seaforth and District Community Centres Building Committee - Seaforth Fire Area Committee - Seaforth Public Utility Commission - Naterworke Department - Ontario Home Renewal Program Trust Fund (iv) Other revenue°, expenditures, evicts and liabilities with respect to the operations of the school board°, and the County of Huron are not reflected in these financial statement° except to the extent that overleviee (underlevies) are reported on the "C0000lldated Balance Sheet" as "other liabilities" ("other current aeeeto"). 1985 1984 principal $ 11,000 $ 10,000 Interest 1'829 2.883 $ 12,829 $ 12,883 5. Municipal fund balances at the end of the year The balance on the "Consolidated Statement of Operations" of municipal equity of $46,325 (1984 - $1,481) at the end of the year le comprised of the following: For general reduction (increase) of taxation Por reduction of Business Improvement Area taxation 1985 1984 $ 36,983 $ (3,067) x�((9,342 4,548 5 yi ,325 $ 1,481 6. Reserves and Reserve Funds a) The total balance of reserves and reserve funds of $175,076 (1984 - $250,536) 1s made up of the following: 1985 1984 Set aside for. specific purpose by Council - for industrial development - for working capital - for heritage 5 40,913 $'45,482 109,453 109,404 16,710 - 175,076 154,886 (b) Basis of Accounting (1) Sources of financing and expe diture° are reported on the accrual basis of accounting with the exception of principal and interest charges on long tern liabilities which are charged against operations in the periods In which they are paid. The principal and interest charges arc not accrued for the period from the date of the latest installment payment to the end of the financial year. (LS) The tavailable and measurabrual beaii of ler recognized are regnizrecognizes revenues as ed a■ they are incurred and measurable as a result of receipt of good■ or services and the creation of • legal obligation to pay. (111) Capital Outlay t'q be Recovered in Futuro Years R t ! n ..,.,Y. The i`i�i(�toifeif teat mtld`illecuaulaecd depreciation of fixed assets' ar'not rapbrted for iunicipal purposes. Instead the "Capital i outlay to be recovered in future years", which represents the outstanding principal portion of unsecured long term liabilities for municipal expenditure' or capital funds transferred to other organisations. is reported on the "Consolidated Balance Sheet". CONSOLIDATED STATEMENT OF OPERATIONS for the year ended December 31, 1985 Set aside for apecific purpose by legislation, regulation or agreement - for loans under the Ontario Home Renewal Plan - Nate 6(6) 95.650 175,076 250,536 Reeervea - included above 108,710 108,710 $ 66,366 $141,826 b) Effective January 1, 1985, amendments to regulations require the Ontario Home Renewal etogram funds be accounted for as a trust fund and no longer as a reserve fund. The transfer of the fund balance has reduced the total opening reserve fund balances by $95,650 and Se not reflected in the consolidated statement of operations. The 1985 transactions for this program are reflected in the financial statements for the trust funds of the municipality. 7. Unfunded Pension Liability ' 2. Operations of the School Boards and the County of Huron Further to note 1(e)(i0, the taxation. other revenues, expenditures and 00.116vle6 (underievlem) of the school boards and the County of Huron are comprised of the followings School !nerds County Taxation 5380,049 5107,600 Payments In lieu of taxes 543 374 380.592 107,474 Requisitions 377,784 107,182 Supplementary taxes 2,808 792 380,592 107.976 Overlevfes (underlevies) for the year NIL NIL Overievfee (underlevies) at the beginning of the year Budget Actual Actual 1985 1985 1984 SWIMS OF FINAMCIMOt Taxation and user charges Residential end faro taxation Commercial, industrial and business taxation Taxation from other governments User charges and fees Deduct: Amounts received or receivable for county and school boards Grants Government of Canada Previn40 of Ontario Other municipalities $ 591,733 $ 591,523 $ 563,808 370,533 372,681 345,397 Overlevies (underlevies) at the end 8 (45) $ NIL 30,300 31,140 29,500 of the year ,�,„' 169,420 201,316 143,314 These revenues end expenditures are not reflected in the "Consolidated (486,656) (488,566) (459,391) Statement of Operations'. The overleviee (underlevies) at the end of the year are reported ea other liabilities (other current assets) on the 'Co0aolidated Balance *beet'. Unfunded Pension Liability During the year the tow amended by -lav number 667 such that policemen are now entitled to retire at 60 years of age as opposed to 65 years of age. The net affect of this change vas an underfundir'8 in the insthea olicemen's pension plan of $28,113 et January 1, 1985. the of the change. The town intends to pay this amount plus interest In five equal annual instalments of $7,041; the (Stet instalment having been paid in December 1985. The unfunded balance es at•December 31, 1985 of 523,321 has not been accrued in thee. financial atete.enta. 8. Contractual Obligation - Ministry of the Environment In .c ordance with a .01viea agr0a0ent entered 1010 by the Town In 1975 with the Ministry of the Environment, the existing sewage System is owned and operated by ch6 Ministry. The Town is obligated to meat ell operating costa and repay the long -ten, Liabilities related to this project. Included in the "Consolidated Statement of Operations' are the 1985 charges from the Ministry of 5123,975. The Consolidated Balance Sheet - does not reflect any assets or 11,61111101 pertaining to the savage system except to the extent of service ehargea due co the Nlni6try. Information received free the Hlnistry as at Ketch 31. 1985 indleates the following: Accumulated mat deficit $199,026 1985 debt charges $ 75,452 Total outstanding long -ter liabilities 5784,933 Otber ' Investment income Sale of land Other Net appropriations frbm reserves and reserve funds ND21ICIPAL FORD BALANCES AT T80 EE0P(NLNG Olt THE TEAR (Note 5) To be used to offset (or to be recovered from) taratien or user charges 1,000 499,265 24,6'0 3.183 2.283 524,122 443,918 25,013 24,390 1,500 8.322 12:251 .000 31,230 58,178 22,547 27,759 S, Contrtti1tfor,s to Unconsolidated Joint Cords Further to note 1(.)(111), the tweet tied Liabilities of uncohsolidat.4 joint boards have not been Consolidated and ate net reported on the "Con801ideted 5.lende Sheet'. The operations of the joint boatda have also not bean consolidated. The contributions made bynt Of the sun elpaiity toretione caudes hoes boards fol2emdng 1985 1984 1,481 1,481 (37,825 Seaforth and District Community Centres Management Committee Seaforth Fire Area Committee Total financing available during the year 91,261,565 $1,328,451 81,146,222 Budget Actual Actual 1985. 1985 1984 APPLIED TO: • Current operations General government protection to patrons and property T3abt"portatien services gnvitonnentel services Social and family services Recreation and c1ltural services Planning and development 926,611 $ 11,395 14,094 ,.20,806 $40,705 8 30,201 ONTARIO HOME REN,E�WU T PROGRPM UND RSTATEMENT OF CONTINUITY for the year ended December 31, 1985 talance, at the beginning of the Pear Traae'fer from Ontario Heal Renewal 90'ogtam 8alerv6 90MS. Jaan'art 8, 1985 (Mote 7) interest earned $ 225,957 $ 207,673 $ 189,240 253,236 258,877 239,702 199,100 209,I61 176,858 Sots long "lets liabilities incurred by the 158,900 2131,358 ib#,054 �. 382 17 mthici alit includi those Lncutrred on .112.300 104,2'66 96,923 sanicl elides and municipal r 100 8 Y 15.252 behalfpOf school boards, other ,__.._ 9,.157 13.045 and autatdndin et the year end seou01 to $13,848 $132,000 . .962,638 096 877 879,051, he the selyibr 1the obvave, principal and Interest ehargeehos bees resin:aid by the Huron 4308017 Beard of ,(1,848) '(109,000) Education for a principal amount of Net 166g term liabilities at the end of floe yeas $124000 $ 23,000' .sem (6) Aaagnl pay60nte required On the net long term 114611it/ea are tie frtiidO l principal iateritet. 5.12:000 $ 650 198E (c) 766 munielpality a Eonting'ently liable for long feta liabiliti4 for shish the re6p9n4b11Lty for the payeent of Principal and 00tdreat has 6•ee aeenmep *the 'Baba board: The total e.dnnt out"atendte8-.. at Oateeber 31, 1985 1s 51,848 (1984' $109 000)'. *64' nd S*'not recorded oa the.'Conaoldd018d 6elanc* Shoot". - 4. Net Long lean Liabilities (a) The balance of net liabilities repotted on the 'Consolidated 8alence Sheet' is_aede up of the follavingt 49;85 1984 Co®Seaidne 2001001116 of forgiveable loans $ NPL 95,650 5,404 10T,O54 2,116 12,666 '.Capital3,000 3,206 General goverr,eert I6,560 16,253 protection to persotte and property 75,400 97,907 tradapettatinn 66riieee 160,000 130,925 Eneiro0mental ser518es 40,000 22,090 Recreation and cultural aerviees _ _2,090 Planning and development '- 271 661 295.860 10,973 19,005 163,507 31,344 11,153 388 242,575 Het appropriations td reserve# ands 20,190 reserve fluids esn*ICIPAL tamp 881.IIIC88 AT 1it6 T,gD CP 186 TEA5 (Note 5) To be used 44 offset (et id 766 ret:dbeted% 3.067. 46:325 frame) taxation ext user shards Total appliea`tioha during thegyear $7,261,565 51,328,452 23,115 481 $1,146,212 • Balance, at the and of ilia year 9 86,272 NOTES TO THE.. FINANCIAL STATE ENTS: flcer :ber 31, 1985 1'. Adcauhthiq Policies Untie of Aerotiating canals of financing And expanditores are reported on the seetual beide., • 2. twit Fu'nd's 8ffeetive Jaded * 1, 1985; 6mendmente to r'egulationa raynire the Onterfo 8e 0 8eneval program tendo lm accounted for se a ttxr'at fund and no longer es a.riiifie.fund Co.pirttiva figures.have not odea p1041864 08 801. 4. the/frail-04i 'of operatioae of the treat fund.