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HomeMy WebLinkAboutCS 33-07 ,~ Report Number: CS 33-07 Date: September 10, 2007 Cit.J1 0# REPORT TO EXECUTIVE COMMITTEE From: Gillis A. Paterson Director, Corporate Services & Treasurer Subject: 2006 Year End Audit Recommendation: 1. That Report CS 33-07 of the Director, Corporate Services & Treasurer be received; and, 2. That the 2006 draft Audited Consolidated Financial Statements for the City of Pickering be received and forwarded to Council for approval. Executive Summary: Not applicable ~\~ Financial Implications: None. This report provides the draft Audited Consolidated Financial Statements for the year ended December 31, 2006. Sustainability Implications: implications. This report does not contain any sustainability Background: The Audit of the consolidated financial statements for the year ended December 31, 2006 has been completed. Attached is the draft Audited Consolidated Financial Statements. The draft Consolidated Financial Statements are the responsibility of management and have been prepared by City accounting staff under the direction of the Director, Corporate Services & Treasurer. Deloitte & Touche LLP are responsible to express an opinion on these Consolidated Financial Statements based on their audit. An unqualified opinion has been provided. I am pleased to advise the Committee there were no problems or questionable items I have to report to you at this time. However I would like to summarize some financial highlights. Report CS 33-07 Date: September 10, 2007 2006 Year-End Audit Page 2 The Consolidated Financial Statements also includes the activities of the City of Pickering Public Library Board and the proportional consolidation of Ajax Pickering Transit Authority. Even though transit operations were transferred to the Region effective January 1, 2006 the final accounting and formal dissolution of APT A was not completed at December 31, 2006. Therefore for reporting purposes any transactions, remaining assets and liabilities pertaining to APT A have been consolidated in the City's financial statements for the reporting year. Overall net assets marginally increased over prior year as a result of an increase in financial assets of approximately $10.6 million offset by an increase in liabilities of approximately $9.6 million. Financial Assets The increase in financial assets is primarily due to an increase in the temporary investments balance ($7.6M) which arose due to the timing of supplementary taxes billed and collected at the end of 2006, the overall increase in the obligatory Reserve Fund balances, primarily Development Charges Reserve Fund and Federal Gas Tax Reserve Fund and a dividend received from Veridian in late December. The taxes receivable increase of approximately $1.0 million over the prior year is reasonable since total taxes billed increased over the prior year. The outstanding receivable balance at December 31, 2006 represents 8.2% (2005 - 7.8%) of total taxes billed which is comparable to the prior year. ~~, The increase in the investment in Veridian Corporation arises due to the City's share of Veridian's net income offset by the dividends received from Veridian during the course of the year. Liabilities The increase in liabilities is primarily due to an increase in the accounts payable and accrued liabilities balance ($6.3M) that arose due to an expenditure accrual for an expected settlement of an assessment appeal that has been outstanding for a number of years. A report summarizing the settlement is currently being prepared for presentation to Council in September. The increase in deferred revenue arises from the increase in the obligatory Reserve Funds which are made up of the following: Development Charges, Parkland, Third Party/Developer's Contribution, Ontario Transit Renewal, Provincial Gas Tax and Federal Gas Tax. In compliance with generally accepted accounting principles, these restricted funds are to be reported as deferred revenue. The Development Charges Reserve Fund and Federal Gas Tax fund balance increased because of the timing of receipt of funds and occurrence of related capital expenditures. Report CS 33-07 Date: September 10, 2007 2006 Year-End Audit Page 3 '*'-;- The increase in long-term liabilities is the net effect of the issue of $2.792 million in debentures in July 2006 and the annual debt payment. Revenues & Expenditures Consolidated revenues and expenditures are comparable with the budget with the exception of government grants and fees, investment Income and general government expenditures which are discussed below. The budget for government grants and fees includes provincial and federal grant monies, such as COMRIF and federal gas tax, identified in the 2006 capital budget to fund various capital projects. Because of the timing of capital expenditures, revenue can only be recognized for those expenditures incurred. Since the identified projects were not fully completed, the revenue is not fully recognized in that year and thus provides this difference from budget. The budget for investment income is usually a conservative estimate as it is difficult to predict interest rates and timing of cash on hand. The variance from budget of approximately $800K arose due to the unexpected interest rate increase over the course of the year and excess cash on hand from timing of receipts. The budget """ estimate, although remaining somewhat conservative, was increased to $1,000,000 for 2007 to reflect the increased interest rates and higher investment balance. The higher than expected general government expenditures results from the City's share of the accrual for the expected assessment appeal settlement as noted above. As you are aware capital expenditures for projects may be incurred over multiple years and often are not comparable to budget. As a result capital expenditures incurred were significantly lower than those budgeted. This is a direct result in timing of approval in the budget and completion of the project. For example, approximately $3.8 million was budgeted in 2006 for external subdivision works of which approximately 10% of this amount was incurred in 2006. Attachments: 1. 2006 Draft Audited Consolidated Financial Statements ,;.,;.0''''''' '.- ~ ~_' ~r . '~'-'-'-T.-t; Report CS 33-07 2006 Year-End Audit Date: September 10, 2007 Page 4 Prepared By: ) r' ~ ~ (~ .. J.~ a" i' "- (-<~ tA ristlne Senior Manager, Accounting Services GAP/vw Attachment Copy: Chief Administrative Officer Approved I Endorsed By: .. .~~. -~ L~ '. Gillis A. Paterson Director, Corporate Services & Treasurer Recommended for the consideration of Pickering City Council Thomas J. Quinn, RDMR., CMM III Chief Administrative Officer -<'!W~lW' CS 33-0j7 / I / / / / / / // / '~ /// I / / / / / / / / / / ,/ /? II / ~'cl; / / I / I / / / / /' Consolidated Financial Stotement'7'(;; / THE CORPORATIoN O~7~ / CITY OF PICKE,iNG December 31, 20001" / I \\<:::-::::; / / ~/ / i~-/ Q'~7 :; ~i / I MC Document m 22JJ City of Pickering Notes (7/10/073.17 PM FOR DISCUSSION PURPOSES ONLY / #~)jlr ~j ''M'J' ~" ""~ / / / / / / ~- Deloitte & TOtXhe LLP 5140 Yonge/Street Suite 1700/ Toronto ON M2N 6L7 Canad:;/ . / / I T.eI/416-6.01-6150 II FiD<: 416-601-6151 .www.deloltte.ca I / / / I / . 1/ II / / / / / / / /1 / // / / / / We have audited the consolidated statement of financial pclsiti6h of the Csiporation of the City of Pickering as at December 31, 2006 and the consolidated stat6mentsOf financial activities and of changes in financial position for the year then ended. These finan>ial statemen!s,are}he responsibility of the City's management. Our responsibility is to express an opinioron these financ,Ystatements based on our audit. We conducted our audit in accordance with Can~tkn generally ae{epted auditing standards. Those standards require that we plan and perform an a~.:ili~~ obtain reaso11able assurance whether the financial statements are free of material misstatement. IAn audit include( examining, on a test basis, evidence supporting the amounts and disclosures in th~finatlciaJstatemiI;ts. An audit also includes assessing the accounting principles used and Significallt/estimat~s. !hade;by management, as well as evaluating the overall financial statement presentation. 1/ \\\ I In our opinion, these consolidated fir~cial statements~tsent fairly, in all material respects, the financial position of the Corporation of th~li'~y of Pickeririg as at December 31, 2006 and the results of its ;~~:~~~;'a~;:p:~~ ~;;;7~~~~7[O' the yea, then ended ;n a"",dance whh Canad;an / / / Chartered Accoun)ants Licensed Public;Accountants Toronto, on~.o . April 13, 07 Auditors' Report To the Members of Council, Inhabitants and Ratepayers of the Corporation of the City of Pickering '*" 700eument In 2211 City of Piekerlng Notes ( 7/10/07; J,17 PM / FOR DISCUSSION PURPOSES ONLY I / / / / / ii~'-1t~J- -j a-i\t---- ~ jl---C' THE CORPORL\TION OF THE CITY OF PICKERING Table of Contents December 31,2006 , / , / / / / // /] / / / 2 / / I / / / / / / / / / / / / / / / Consolidated Schedule of Operating Fund Financial Activitie~cYFund Ba]anc/I / "/ 7 Consolidated Schedule of Capital Fund Financia] Acti~ and Fund:s~~e Con,ol;dated Schedule nfRos,"'" ",d Rcs",ve F~.....n..d. ,...f....i.nandal A~e' and Fund Balance /('~ / / \\........./.....; / \ v / / /\ / 'II / / / / I Consolidated Statement of Financial Position Consolidated Statement of Financial Activities Consolidated Statement of Changes in Financial Position Notes to the Consolidated Financial Statements /Document in 2211 City of Pickering Notes ( 7/10/07. 3.17 PM FOR DISCUSSION PURPOSES ONLY // I I Paue / ~/ / 3 4-]8 19 20 2] THE CORPORATION OF THE CITY OF PICKERING Consolidated Statement of Financial Position December 31,2006 / / / / FINANCIAL ASSETS Cash Temporary investments Taxes receivable Accounts receivable Other current assets Investment in Veridian Corporation (Note 4) Promissory notes receivable (Note 5) LIABILITIES Accounts payable and accrued liabilities Other current liabilities Deferred revenue (Note 6) Long-term liabilities (Note 9) Post-employment benefit liability (Note 8(a)) WSIB benefit liabilities (Note 8(b)) ~ NET FINANCIAL ASSETS NON-FINANCIAL ASSET / / / / /' / / / Inventory NET ASSETS / 2006 / / I $ 2,969,181 / $ 50,867,722/ 11,367,986 4,892,92'" 53e-;363 / 34,768,015 2,5,069,000 ,130,464,291 / / / ' /. / / /1 / / II /17,625,266 / .' // 61,168 /29,~292 / 9~929,000 /2,316,950 / 690,331 / 60,057,007 / ;/ / $ 70,407,284 209,760 70,617,044 2005 2,711. 43,287;887 10,315,099 4;532,772 / 422,075 /33,558,427 / 25,069,000 / 119,906,416 11,334,288 254,032 27,658,305 7,984,000 2,306,250 952,898 50,489,773 69,416,643 $ 438,987 69,855,630 $ (50,232) $ 1,271 5,209,345 4,079,053 20,148,226 20,725,437 62,880,035 61,670,447 88,187,374 86,476,208 (17,570,330) ( 16,620,578) $ 70,617,044 $ 69,855,630 Page I of21 ",~'fi- ..iin: " -j : t" t ~ ";'I l!'-"f"~r )."Jif"yC"P! / THE CORPOR4.TION OF THE CITY OF PICKERING Consolidated Statement of Financial Activities Year ended December 31, 2006 I / / / / / / / I / / / I / / 2005 Actual;1 Actual ;/ / / / / / ,I' $ 26,111,967 $ 26,474\748 $ 26,52~;006 6,545,118 6,683,041 6,)89,020 6,887,159 r,~b7,311 ~(623,333 7,984,58: /7,194,785 /8,951.432 4,643,83~ /1 2,$06,426. 710,432 79,000 549,778, / 680,442 1,646,550 / 1,552,588// 1,063,284 605,0~Y 1,498,7~ 945,532 1,380,900 1,698/53 1,534,795 50r,000 5~,341 550,611 1,~2,2fO 1, 05,244 1,905,244 V,158-',922 602,157 4,691,574 /~9,394,360 ;58,493,431 62,773,705 / '<>/ I 12,117,23/1 14'67~'0 . 5,635, 2 / 3 ,619 /58,552 / 1~;708,378 /2,724,862 52,161,586 2006 Budget REVENUES Residential and farm taxation Commercial and industrial taxation Taxation from other governments User charges Government grants and fees Developer contributions and donations Development charges and developer contributions earned Investment income Penalties and interests on taxes Fines Interest on promissory notes Other Total revenues EXPENDITURES (Note 14) Current General government Protection to persons and propeliy Transportation services Environmental services Social and family services Recreational and cultural services Plannin and develo ment Capital General government Protection to persons and prop Transportation services Environmental services Social and Family Servic s Recreation and culturay{ervices Plannin and develo ment 1,351,880 1,701,308 6,755,500 125,000 211,000 2,672,665 6,750 12,824,103 64,985,689 te 4 c)) NET EXPE DFCURE)REVE E INCREA% (DECRJ2:ASE) I AMOUNTS TO I}E ~COVERED' Ptmcipal repayment f debentures )rincipal repaymcyIt of internal loans Procecds from debentures Post-employm61t benefits liability Proceeds frorh internal loans WSlB be fit liabilities (5,591,329 (1,808,039) 3,013,757 686,000 1,891,718 $ (3,699,611 ) DECRE E IN NON-FINANCIAL ASSET CHANE IN FUND BALANCES Worksh et In 2210 City of Pickering FS (//102739)- 7/10/2007; 3:14 PM FOR DISCUSSION PURPOSES ONLY 15,302,981 13,513,808 5,308,877 46,718 333,056 16,047,858 1,928,424 52,481,722 9,377,042 12,977,758 12,165,029 42,682 348,748 15,068,380 1,7 49,085 51,728,724 1,280,176 1,161,949 1,739,315 253,167 3,570,541 6,644,547 91,493 14,945 15,314 1,993,404 3,207,192 782 4,411 8,690,656 11,286,580 61,172,378 63,015,304 3,669,588 3,227,016 990,641 2,985,417 (847,000) (807,000) (1,095,381 ) (1,110,725) 2,792,000 10,700 8,400 352,000 287,000 262,567 321,112 949,752 (1,301,213) (229,227) (9,220) $ 1,711,166 $ 1,674,984 Page 2 of21 ~~" ',~ THE CORPORATION OF THE CITY OF PICKERING Consolidated Statement of Changes in Financial Position Year ended December 31,2006 I // / / I I , 2006 2005 NET INFLOW (OUTFLOW) IN CASH RELATED TO THE FOLLOWING ACTIVITIES / OPERATING Net revenue Change in equity in Veridian Corporation $ 990 64'1 . (3,66~588) (2~78,947) II / 1 (1,042,887,) / I (359,252( I /. g~~~~ (2 1,567) . '(1;)65,858) Uses Increase in taxes receivable Increase in accounts receivable Increase in other current assets Decrease in other current liabilities Decrease in WSIB benefit liabilities Sources ,I Increase in accounts payable and accrued lia6ilities Increase in deferred revenue / Increase in post-employment benefit liability Increase in WSIB benefit liabilities I / / / 6,290,978 1,775,987 10,700 / / I 8,077,665 3,432,860 (7,579,835) 2,460,000 (5,119,835) FINANCINNG Proceeds from dy enturcs issued Principal repa r I ent of debentur' I / / ,I / / / $ 2,985,4] 7 (},'227,016) / (24 I ,599) , (834,292) (1,277,270) (141,626) ( 159,372) (2,412,560) 309,651 3,544,473 8,400 321,112 4,183,636 1,529,477 (8,568,563 ) 1,968,000 (6,600,563) 2,792,000 (847,000) (807,000) 1,945,000 (807,000) 258,025 (5,878,086) 2,711,156 " 8,589,242 $ 2,969,181 $ 2,711,156 NET INC EASE (D~C~?ASE) IN CASH CAS~EGINN[NG F YEAR CA , END OF YEAR Worksh et in 2210 City of Pickering FS (#102739): 7/10/2007 3:14 PM FOR DISCUSSION PURPOSES ONLY / Page 3 of21 ,",."", t' '.~. "1' < "i ".,~ v", '''' :lif tii THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31,2006 /' / / / / / / // / //// // / 1. / SIGNIFICANT ACCOUNTING POLICIES / / / / The consolidated financial statements of The Corporation of the City of Pickeri~g (the "City") a~ the representations of management prepared in accordance with generally/accepted accounting principles for local governments as established by the Public Sector Accou~ting Board ("PSAB") of the Canadian Institute of Chartered Accountants. Significant accounting policies adopte! by the City are as follows: / /' / / . (a) Reporting entity / " , (i) Consolidated statements / / / / The consolidated financial statements reflect/tl~e assets, liabjri'ties, revenues and expenditures of the operating fund, capitifll nd, reserve fun,0s and reserves. The reporting entity is comprised of the activitie oflo/l committeelof Council and the City of Pickering Public Library Board which is onti:~l!~a by the/ity. All material inter-fund transactions and~ances a;~~lim~ted on consolidation. (ii) Proportionate consolidation II II The consolidated financial state~ts reflect the city's proportionate share of the assets, liabilities, revenues and expej;&;~...~res of the AJ,aX Pickering Transit Authority (APT A). (see Note 2). /', I All inter-entity tzansa nkns consolidated. (iii) Investment in Veri Ian Corporation I The City's inv stment in Veridi n Corporation is accounted for on a modified equity basis, consis nLwith general' accepted accounting principles as recommended by / n. PSAB for i vestn1~:ntsjl1 go mment business partnerships. Under the modified equity basis, Ve dian C'QiR?ral(o s accounting policies are not adjusted to conform to those of the Ci and inter-otgani ational transactions and balances are not eliminated. The City reco izes its equity i. erest in the annual income or loss of Veridian Corporation in its sta ment of financjill activities with a corresponding increase or decrease in its i!J'~estment asset /iccount. Dividends that the City may receive from Veridian i,":orpo. ration and~ther capital transactions are reflected as adjustments in the investment asset accounj iv) Oper~tions,6f school boards and the Region of Durham / The {;~on, other revenues, expenditures, assets and liabilities with respect to the oper<;tfons of the school boards and the Region of Durham are not reflected in these coryiolidated financial statements. / (v) lrust funds / Trust funds and their related operations administered by the municipality are not / consolidated, but are reported separately on the Trust Funds Statement of Financial Activities and Statement of Financial Position. ~, are eliminated when proportionately .~, M Document In 22Il Cdyof Pickering Notes ( 7/10/07; 3;17 PM Page 4 of21 FOR DISCUSSION PURPOSES ONLY .~. / I I I I THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31. 2006 I I I / I / / / / / / / / I / I (b) SIGNIFICANT ACCOVNTING POLICIES (continued) Basis of accounting /// / / / 1. (i) / / / / Temporary investments are recorded at the lower of COsv ;'1)/( accrued i;tt&est and market value. Any premium or discount of purchase of a]Vlnvestrr~ is amOrtized over the life of the investment. /::::, /1 Tangible capital assets / II Tangible capital asset expenditures incurred d].iLg the year ar/~corded as capital expenditures in the consolidated statement of fulancial activities;1 / /) / / II / Accounting fo' Pmpecty Ta' Capping ,.OV~ ,csnlti/g ham the OOla,io Fai, Assessment System / L//~ / The net impact in propeliy taxes as 'fTesult of the appJ1cation of the capping provisions does not affect the Consolidated Statement of Financi~l Activities as the full amounts of the property taxes were levied. ,However, the cap>>lng adjustments are repOlied on the Consolidated Statement of Fina;kial Position as ivreceivable from the Region. / ~./ / D. eferred revenue / \<'~. ,..... I" \\ I --7 Defened revenues represent user ~)1~)rge~nd fees which have been collected but for which the related s~r,fces have yet to fi performed. These amounts will be recognized as revenues in the f;scal year the services are performed. In addition, any contributions / received with ext mal restrictions a e deferred until the related expenditures are made. Temporary investments ( ii) (iii) (iv) (v) Post employ nt benefits /01 The prese t va'l~-OH:l117 c t of providing employees with future benefits programs is recogni~d as empf~ees/earn these entitlements through service. Actuarial gains and losses arc amOliized. oler the average remaining service period (ARSP). The actuary dete ined ARSP to t>C 16 years. / ventory I.Il,[~ntory is v ued at the lower of cost and net realizable value. Cost is determined on a /AG. 'elQhted-av rag'e basis. ~/ b)\ (vii) ~nlent transfers Gov4nent transfers are recognized in the financial statements in the period in which th~~~;~ts giving rise to the transfer occur, eligibility criteria are met, and reasonable stimates of the amount can be made. The preparation of financial statements in confonnity with Canadian generally acceptcd accounting principles requires management to make estimates and assumptions that affect the reported amounts in the financial stakments and accompanying notes. Actual results could differ from these estimates. Page 5 01'21 M Document In 2211 City of Pickering Notes ( 7/10/07 317 PM FOR DISCUSSION PURPOSES ONLY X!>Ci" ~ --1 ~>_.- ~"YfJ'- ":-' THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements Decem her 31. 2006 I!: ',iUlM:_ < r'c / / / / / / / / / , I / / I ,/// Effective September 4,2001, a joint Board of Management was established by/the City of Pickering and the Town of Ajax by way of a Merger Agreement for operating ~'transit system SlCross Pickering and Ajax. Operations, under the control of the joint boartf, commenced yITective January 1,2002. / / In January 2005, the Councils of the City of Pickering and the TO~ of Ajax passel a resolution agreeing to the transfer of the responsibilities for transit servicesAo the Regional J<'lunicipality of Durham (the "Region"). On January I, 2006 the Ajax Piclsi~ing Transit Autf{ority ("APTA") transferred its operations to the Region as part of the./Du.r.i1am Region Tra~it Commission in accordance with Regional By-law #85-2004. I / Negotiations between the City of Pickering, Town of 1)-ja~irid/1he Reg~ are still underway as to the ultimate realization of assets and assumption 0" liabiliqes by te Durham Region Transit Commission. /:; / During 2006, APT A finalized transactions in pfogress, collecte9/~eceivables and settled liabilities outstanding at December 31, 2005. Any remaining fund balay-te will be settled once negotiations with the Region are completed. I I The following table provides condeI}sed supplemental financial information for the Transit Authority for the year ended Dcccm~~{- 31: \></:) I / / / II 2. AJAX PICKERING TRANSIT AUTHORITY Financial position: Financial assets Non-financial assets Liabilities Net liabilities Fund balance Amounts to be r overed Transit Autho ty Position FinanCial... ..c..t...i.V....iti.es: I Rev ue .. . OJ? ratingexp~nditu es apitalexpen,\:l;itur s ", " ' / t expenditures / / / / Fund balance, eginning of year Net expe itures Increas in amounts to be recovered Incre e in non-financial assets M Document In 2211 City of PIckering Note< (.7/10/07 3J7 PM FOR DISCUSSION PURPOSES ONLY 2006 $ 266,884 536,894 (1,350,612) (546,834) $ $ (336,134) (210,700) (546,834) $ $ 358,417 (113,165) (348,324) (103,072) $ $ (233,062) (103,072) $ (336,134) / / / / / / / / / //1 I // ~, 2005 $ 1,004,441 536,894 (1,985,097) (443,762) $ $ (233,062) (210,700) (443,762) $ $ 13,318,943 (12,026,290) (1,518,568) (225,915) $ $ (57,524) (225,915) 3,600 46,777 (233,062) $ ~, Page 601'21 / / / I THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements Decem ber 31, 2006 1 / / 1 / I OPERATIONS OF SCHOOL BOARDS AND THE REGION OF DURHAM// / / // Further to Note 1 (a) (iv) requisitions are made by the Region of Durham/~nd School Boa(ds requiring the City to collect property taxes and payments in lieu of property taxes on theirYl1alf. The amounts collected and remitted are summarizes as follows: / . / Region SchO,ol Board $ 7Q..,{25,816 $/;;1,081,783 4,807,491 / 520,039 $/ 75,133,307 / $ 41,601,822 INVESTMENT VERIDIAN CORPORATION ~, , / (a) Veridian Corporation is owned by the City oFPickeril)g, Tow~f Ajax, Municipality of C1arington and the City of Belleville. Vey(dian Corporatiol as a govemment business partnership, is accounted for on the modJfied equity basi/in these financial statements. Veridian Corporation serves as the electriyal distribution utility for a number of communities including the four noted above and 70n acts non-regulatei utility service ventures through its subsidiaries. / The following table provides con;tens~~;;uPPlemen;~ consolidated financial information for the corporation and its subsicliari,es for tbe, y,', ear/ended December 31: / \V I / / / . / / libles 3. Taxation Payments in lieu of taxes 4. '~ Financial Position: Assets Current Capital and inta Other Total assets Liabilities / Cune Lon term debt Ot er Toti! liabilities ltcluitY / Share.c~p'ital . / Conit] bllte<;y capital I Retaincc1/amings / Total equj.{y Totalli;rbilities and equity / Fh'n rkial Activities: I evenue / / Other income II Expenses / / Net income for the year I=ument m 2211 Cdy of PIckering Notes { 7110/07,' 3,17 PM / II .' :~.__? / '/" / .j / / / FOR DISCUSSION PURPOSES ONL Y 2006 2005 68,864,051 138,225,079 946,571 $ 208,035,701 $ 92,281,194 132,918,454 2,201,700 227,40 1,348 $ $ $ 42,312,425 $ 130,029,467 60,794,000 20,129,238 15,522,058 123,235,663 145,551,525 67,285,173 67,285,173 24,910 24,910 17,489,955 14,539,740 84,800,038 81,849,823 $ 208,035,701 $ 227,401,348 $ 223,302,423 $ 207,388,764 6,823,343 4,894,868 221,175,551 204,412,861 $ 8,950,215 $ 7,870,771 Page 7 of21 / / / I / / I / 1 / / Balance, beginning of year / Equity share of net income for th~e~ Dividend received from V eridiarr COrpPra~ion_ Balance, end of year (d) Contingencies and guar~es of statements are as fOllOI,lllt (i) Insurance clajizs: I /., \\ The Com6rat(~h<(s~~a=h1 nber of .the Municipal Electric Association Rec~procal Insuranof' Exchange~C'M ARlE") whIch was created on January 1,1987. A recIprocal ins~r rice exchange m be defined as a group of persons formed for the purpose of exc anging reciproc contracts of indemnity or inter-insurance with each other. ~ ARIE provides eneralliability insurance to member electric utilities. Insurance pre urns charged to each member utility consist of a levy per $1,000 of "'experjcnc5/ Insurance IJlmts of up to $30 mIllIon per occurrence are covered by M; / / / / / / ""~'-r" "XI , ~-,- !. - -.)- J'Tli'!!i i---pt .--!ii!t-.{jl"'iil:-~iD:1'-~ I , THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31, 2006 I I / / / / / 4. INVESTMENT VERIDIAN CORPOR<\TION (continued) , / / / / I / / 2006 / ;I / I I / / / / (b) City of Pickering's equity represented by: Promissory notes receivable (Note 5) 2095 / $ 25,069,000 .. / ,496,196 /30,496,196 8,256,018 / 4,586,430 (5,093,020) / (2,633,020) 1,108,821/ 1,108,821 34,768,0 5 $ 33,558,427 $ 25,06<),000, I Investments in Veridian Corporation Initial investment in shares of the Corporation Accumulated income Accumulated dividends received Increase in value of investments Total investment (c) Equity in Veridian Corporation ..V/, / II 2006 Ii 61,670,447 / 3,669,588 / (2,460,000) $ 62,880,035 $ 61,670,447 2005 $ 58,443,431 3,227,016 Corporation as disclosed in their financial / M Document 'n 2211 City of P,ckermg Notes (' 7/10/07' 3,17 PM Page 8 of21 FOR DISCUSSION PURPOSES ONLY r-""f <>Ni\" / I / / / ~-". ~- / ~ THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements Decem ber 31, 2006 / / / / / / / / / / (d) (contin ued) II / I / / / / I / / / .... INVESTMENT VERIDIAN CORPORATION (continued) ,~ / / / An action has been brought under the Class Proceedings 1).ct, 1992. The plaintiff class seeks $500 million in restitution for amounts paid to Tor<)rito Hydro and to.6ther Ontario municipal electric utilities ("LDCs") who received/late payment plnalties which constitute interest at an effective rate in excess of 60jlo per year, contra(y to Section 347 of the Criminal Code. Pleadings have closed in thji action. The actj6n has not yet been certified as a class action and no discoveries havy;been held, as the/parties were awaiting the outcome of a similar proceeding broughJ;/ag~inst EnbridV Gas Distribution Inc. (formerly Consumers Gas)./ ;// I> / On April 22, 2004, the Supreme Court srCanada~~I"asedla' decision in the Consumers Gas case rejecting all of the defences ,which had been! rabed by Enbridge, although the Court did not permit the plaintiff cl;iss to recover dap{ages for any period prior to the issuance of the statement of c1aip{ in 1994 chall~ging the validity of late payment penalties. The Supreme Court rymitted the matterjoack to the Ontario Superior Court of Justice for determination of ~e damages. At;fhe end of 2006, a mediation process resulted in the settlement ofJl{e damages paya)le by Enbridge. / - \.'. .' After the release by the .?"~reme C:O(lrt o~ianada of its 2004 decision in the Consumers Gas case, the plaintift:i in the LDC fatO' payment penalties class action indicated their intention to proceedj~ith the litigatioldl.~'ainst the LDCs, To date, no formal steps have been taken to move the action for;:><arcl. The electric utilities intend to respond to the action if and when it proceed? on the basis that the LDCs' situation may be distinguishabl0'1rom that of Co~umers Gas, The Coep ";;;"";~J\iU)"t" ;!cOllccted late payment pc",I';e, of $5,339,593 from and after 19 4. Nodetermi;la';i;n of the portion of these payments which may have consti ted interest at 'iuv(mpermissible rate has been made. / (iii) Grantees - ver7n Connections Inc. /The Corporation's regulated subsidiary partiCIpates in the competitive supply of / e.lectr.i.c.....ity mayJ(et to procure a supply of electricity for its customers. f3ased upon the . mark.eZ'- ?art'~pant's credit rating, the ~n~rket participants .are r;quired to post security prudential With the Independent Electnclty System Operations ( 'IESO"). At De ember 31, 2006, this requirement was satisfied by the posting of letters of credit i~f amount of $5,565,530. / / / / / IL" '" uu "",, M.,,~ ~", i m'ffi' "',. FOR DISCUSSION PURPOSES ONLY / (ii) Other claims /' I Page 9 of21 ,'~"'u--n: "1-~1-1 r-'1 /// THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31, 2006 / II / / / / / / / / Future minimum lease payment obligations under operating leases ar}las follows: / / $ 678806 63~;OOO 611,000 /i21,000 I 602,000 / 1,148,000 I .~. 4,302,000 / Promissory notes are payable by Veridian Cor~'ltion and Vericyan Connections Inc. in the amount of $7,095,000 and $17,974,000 respect~iVely../with an inte. rest/rate of 7.6% and maturity dates of November I, 2009. These promissory note are convertible Wo common shares at the option of the holder at the rate of I common share for very $1,000 of pyt'ncipal then outstanding on or before the maturity date. / <. .... II / \. \ /, I \V' \1 I DEFERRED REVENUE / / Obligatory Reserve Fun~/ . II Development charg;s /i . \ Parkland / L_. Ontario Transit enewal F~ncjs Provincial Ga Tax Federal Gay ax Third PalfY/Developer's Co tributions Reserve Fund 4. INVESTMENT VERIDIAN CORPORATION (continued) (e) Lease commitments 2007 2008 2009 2010 2011 Thereafter 5. PROMISSORY NOTES RECEIVABLE 6. 2006 $ 22,341,331 1,993,928 19,166 771,076 1,455,769 1868148 28,449,418 984,874 $ 29,434,292 FOR DISCUSSION PURPOSES ONLY / / / // I / / '~\;; 2005 $ 21,135,306 2,103,060 19,166 722,039 850,684 1,819,264 26,649,519 1,008,786 $ 27,658,305 ,~- Page 10 of21 .~ THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31,2006 / / / / , / / / / // / / / / / / / .~ 6. / I / I / / II 2006 $ 27,6?S:305 DEFERRED REVENUE (continued) Continuity of deferred revenue is as follows: Balance, beginning of year Restricted funds received General funds received Interest earned I / /0,088,149 / / 1,108,004 4,196,153/ ~ / / / j. ,:~2,091,112) 1 9 054 . ,420,166) // $/ 29,434,292 II Revenue recognized in current operations Revenue recognized in capital operations General deferred revenues / / I I Balance, end of year / / / / / /2005 / $ ;;4, I] 3,832 I / / 3,821,953 335,053 778.524 4,935,530 (327,773) (1,063,284) (1,391,057) $ 27,658,305 / / / INTERFUND LOANS / \ . ... / As a means of funding various cap~ aCqUis;<<l?J1S'i~:dS are borrowed by the Capital Fund from Development Charges and Parkl;t6d deferred rev~ue (obligatory reserve funds). These funds are secured by ten year promisst notes with inteJCst rates of 4.37%, 5 year promissory notes with interest rates of 4.5%, 3.73~ and 3.67%, and <<year promissory notes with interest rates of 4.25%. The financing arrangemen~ and ultimate r ~yment are approved by Council through the current budget process. For the/pur;pQ.~e of these 1I1ancial statements, the loans are included in amounts to be recovered (Note 1 ~ TJl~:,~91~~~Y1ng i a summary of the related loans negotiated, by function: I~</ 2006 2005 Roads and str~ights / $ 2,470,785 $ 3,122,]29 c.ommu~1.ity; acilities, librariy{ and parks 1,867,264 2,002,544 Fire serVl es / 392,318 334,009 EnvirolJ nental Services / 82,681 97,748 / / $ 4,813,048 $ 5,556,430 / II" I / 7. / I / FOR DISCUSSION PURPOSES ONLY Page 11 01'21 I / I I / II I / 1/ , / / I The City makes available to qualifying employees who retire b7fore the age of/iS, the opportunity to continue their coverage for such benefits as e;dended health and drugs. Coverage ceases at the age of 65. Dependent on eligibility, heqlth c6ver(ige may/be a shared financial responsibility between the City and the retired empJ6yees. The'City/itlso provides full time and permanent part-time employees a sick tip1e entitlement .rCl any unused entitlement is accumulated year to year. This accumu\ited entitlementjs'T.~ot vested and therefore does not get paid out at the time of retirem/eht or termination. The most recent aetu",ial valuation of the post-employment benefits W~p".formed at J0ary 1,2004. Information about the City's benefits liability is aS/~lo/ws: / Accrued benefits liabdity, beginniog of y/ ' :~:~~:::: Current service costs I I' 134,700 Interest on accrued benefits /1 112,800 Amortization of actuarial losses / (25,000) Benefits paid during the year I / (211 ,800) Accrued benefits liability, end;6fyear \/i . / $ 2,316,950 / \jl Accrued benefit obligatiol / $ 1,999,100 Unamortized actuarial sses 317,850 Accrued benefits lial;j ity, end of year / $ 2,316,950 / .~...... / The mam act71 a,{";;'u~;nos e./ployed in the actuac;al valuat;ons are", follows (,) D"7" Ratc " / Tje present value a~ December 31,2006 of the future benefits was determined using a /,dlscount rate 0;0%. ()/ DeJ1tal Costs / The9~rre trend cost at January I, 2004, the date of the most recent actuarial valuation, was 4'.500 per annum. / / / / / /1 t 'toM ~ 1'-- {, THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements Decem ber 31, 2006 ul'r~~n" n- / / / / / / I / / / >~,"'- 8. POST EMPLOYMENT BENEFIT LIABILITY ((1) Post employment benefit liability (iii) / / / / I / 2005 $ 2,297,850 141,500 117,450 (24,300) (226,250) $ 2,306,250 ~ $ 1,963,400 342,850 $ 2,306,250 ealth costs were assumed to increase at 10% in 2005 and decrease by I % increments per year to an ultimate rate of 5% per year in 20 I 0 and thereafter. jDocument in 2211 City of Pickering Notes ( 7/10/07. 3.17 PM FOR DISCUSSION PURPOSES ONLY / ~. Page 12 of21 THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements Decem ber 31, 2006 / / / / ,/ / / / / ,/ Effective January I, 200 I, the City became a Schedule II employp under the W~!tlplace Safety & Insurance Act and follows a policy of self insurance for a)rit~ employees. I / . / / . I / I I II 2006 I 2005 Accrued WSIB liability, beginning of year /1 $ 952,898/ $ 631,786 (Recovery)/Expense for the year / (208,4~3) 382,512 Benefits paid during the year (54, 74) (61,400) Accrued WSIB liability, end of year 69 ,331 $ 952,898 1<> /' Management, using best estimates, identifild that the amou'1t provided in the liability account at year-end of $690,331 (2005 - $952,8,98) is sufficient 19'/ cover the potential liability of all existing claims granted by WS18 and oDtstanding as at I)ecember 3 I, 2006. / / The outcome of any claims filed with \\,S,18 is undey:rninable at this time. / ,. I \ \ ./ /-----~~/ / A WSIB Reserve Fund was e~tablished Ii<WO liThe Reserve Fund balance at December 31, 2006 was $ 834,922 (2005 - 589,575). In\addftion, the City purchased two insurance policies / that protect the City again significant clai~Y(s to the Corporation. The occupational accident insurance pays loss c1ai s up to $350,006 per work related accident. The excess workers compensation indem~ insurance has j $350,000 deductible and will pay for claims up to and including $25,OPO,000 per work r~(ated accident. 9. LONG-TERM L1A~fmi II (a) The balan~f long-term li~ifities is made up of the following: II I 2006 ThelnlLlnicipality is r,'nsible for the payment ;jOfPriDCiPal and)'llterest charges on long-term liapilitie.s issued by the Region of Durham on the municipalitY{ behalf. At the end of the year, the outstaI'ltliI;lg principal amount of this liability is I I II II / / / / / / I Document In 2211 City of P,ckerlng Notes ( 7/10/01317 PM FOR DISCUSSION PURPOSES ONL Y / 8. POST EMPLOYMENT BENEFITS LIABILITY (continued) (b) Workplace safety and insurance liahility (WSIBj Infonnation about the City's WSIB liability is as follows: 2005 $ 9,929,000 $ 7,984,000 Page 13 of21 ~f.- _ _ ~---~-----1 ~-l 1<~ iJl -~--:i'>(n --- -~--~--'~"-------~ ~-'": ~-x-.- ~ ~--< r--. THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements Decem ber 31,2006 / / / / / / /' / / / 9. / / I / I / / / (b) The above long-term liabilities have maturity dates of July 12, 2fJ11, 2016 & 2)}21, November 1,2012, July 15, 2014 and December 23, 2014 with varioyd interest rates rgtlging from 3.3% to 5.6%. Principal repayments are summarized as follow:! I 2007 $1,132,~' II 2008 1,190,\648 2009 1,2;lcS,393 I 2010 1,,<>26,228 / 2011 ),077,159 II Thereafter / 4,253,583 I ;$9,929,000 / (eJ Loog-teon liabi!;ti" include a p,ineipaJ sum ~,O;7,~~;lS '~odablc Debentuces' wbich may be raised by the issuance of debentures .over a further per'6d not to exceed 10 years. / (d) The above long-term liabilities haV~beri approved by C ncil by-law. The annual principal and interest payments required to servo e these liabilitie are within the annual debt repayment limit prescribed by the Ministry of ~ unicipal Affairs 1d Housing. / ; - ( e) Interest expense recordezd in the year relating-to th~e long-term liabilities is $440,813 (2005 - \' I $404,958). \ , "'j 10. AMOUNTS TO BE RECOV ED / / / Fromfiilure revenues:l; ....J ') / Post -employment )Jenefits JiahiI ity WSlB benefit Ij,abilities .~. Intemalloan~A'rom Obligator; eserve Funds Net long-term liabilities / From resr~erunds' / WSI benefit liabilitiel LONG-TERM LIABILITIES (continued) / / / I / 2006 2005 $ 2,137,950 $ 2,127 ,250 363,323 5,556,430 7,984,000 4,813,049 9,929,000 / }i I L /UNICIP AL i~ BALANCES AT THE END OF THE YEAR / The City's fu~alances are comprised of the following: / (a) in" Fund Balan" / /1'0' geoeml "due"oo of taxa lion / /Document in 2211 Cdy of P,ckenng Notes ( 7//0/07. 3:/7 PM FOR DISCUSSION PURPOSES ONLY 690,331 $ 17,570,330 $ 589,575 16,620,578 2006 2005 $ (50,232) $ 1,271 ~ Page 14 of21 THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31. 2006 "tV / I / I 11. / MUNICIPAL FUND BALA~CES AT THE END OF THE YEAR (continued) / I / / / / / / I I Reserves set aside for special purpose?/oy Council Working capital I Self insurance ' ' I Replacement of capital equio/tlent\ . 7. Contingencies I ,. Rate stabilization / ,. City's share for dev710 (nent charge Transit I Continuing studie7' II Vehicle replacement.. Easement set~Jlm(e~t. .....r.~e.,;;er~/ Eastern Braych.', - --I Move Ontario . '.) I Total Res {yes / Reserv/Funds set aside or special purposes ltounci' Recreation pro~ams and facilities . /Acquisition cfrtangible capital assets / Squa~h CO}~1S I WSIJ3' / Total Resey(e Funds I Total Rele"", and RC<e"'e Funds / / / / / ML,"NU"~',^"",'~~",' M~' "'eM / / (b) Capital Fund Balance Funds available for acquisition of tangible capital assets Acquisition of tangible capital assets expected to be Financed by long-term liabilities Financed by taxation or user charges Financed by grants Financed by donations (c) Reserves and Reserve Funds I / 2006 / / $ 6,22?,0l.t. /' / / / Ii (8.t8,273) / (131,084) / (15,822) / I (24,49Q( I . $ 5,209,3;45 / / ~ ) 400,000 II 95],391 /... 685,715 ..., 6,356,615 6,910,981 / 809,654 120,999 47.t,484 72,547 30,000 833,243 17,645,629 / / / / J005 $ / 6,688, I 19 / (2,1 10,939) (199,752) $ (298,375) 4,079,053 2005 $ 400,000 915,514 722,843 10,774,911 3,388,965 484,204 237,]06 342,533 75,000 ] ,095, 129 20,000 18,456,205 ] 94, 175 265,492 1,394,511 1,348,078 78,989 66,087 834,922 589,575 2,502,597 2,269,232 $ 20,148,226 $ 20,725,437 FOR DISCUSSION PURPOSES ONL Y Page 15 of21 / / I / I / / I I I / / "^"< ~:'('t p"'''''i"N1 Wtl'Ji THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31. 2006 , , / / / / I / / ;' / / / / / / ;1 1/ / / I / The municipality makes contributions to the Ontario Municipal Employds Retirement F,l1nd (OMERS), which is a multi-employer plan, on behalf of the members of it-s staff. The play! is a defined benefit plan which specifies the amount of the retirement benefct to be received/by the employees based on the length of service and rates of pay. / / em",i h"!io,,s 00 ,ceo"n! of cmcent mv ice 1m 2006 wece $] ,705, :~005 - $17)91,2, ~. 13. TRUST FUNDS / I / Trust funds administered by the municipality amounting to/$268,567 (2005) $260,785) have not been included in the Consolidated Statement of FinanciavP, osition nor7a " their operations been included in the Consolidated Statement of Financial Ac~liti~?? / (i 14. CLASSIFICATION OF EXPENDITURES BYiJECT / The Consolidated Statement of Financial Acyvities presents tyie expenditures by function; the following classifies those same expenditures l}y object: / 1/ l- . I b - / I Salanes, wages anc cmployee eneht . . /~ "'/ $ Operating materials, supplies and ot er expens~( . Contracted Services 1\1 Rents and financial expenses External transfers to others / Tangible capital assets Total expenditures by obj ct / 15. RELATEDPARTyj.J~~~T~ Veridian Cor or ion / The City oYPickering recei):6 electricity and services from Veridian Corporation (Note 4), a corporatiojY in which The Cty is a principal shareholder. Veridian also provides streetlight and power I~e maintenance se ices on a contract basis. / , ' 2006 2005 Tr l1sactions / / Revenues / Interest orypromissory notes Property;faxes levied Expen~el Eltrical energy and services Balan s A counts payable romissory notes receivable 12. PENSION AGREEMENTS 2006 32,114,799 17,386,515 1,721,394 1,097,] 44 16],870 8,690,656 $ 6],172,378 $ $ ] ,905,294 40,366 $ 1,931,707 $ ] 75,508 $ 25,069,000 FOR DISCUSSION PURPOSES ONLY ; 2005 $ 34,725,091 13,475,404 2,284,134 1,032,190 211,905 11,286,580 $ 63,015,304 $ $ 1,905,294 40,616 $ 1,727,633 $ 156,947 $ 25,069,000 Page 160f21 16. / I / / / / /' / / / / In the normal course of business, the City enters into agreements which con/lain guarantecs',/The City's primary guarantees are as follows: II, (i) The City has provided indemnities under lease agreements for the/6sebf various faiIlities or land. Under the terms of these agreements the City agrees to ind,e'Dmify the countyfparties for various items including, but not limited to, all liabilities, los~, suits, anddamages arising during, on or after the term of the agreement. The maximu,' amount of any),otential future payment cannot be reasonably estimated. / / (ii) The City indemnifies employees and elected official;/ror various itero(including, but not limited to, all costs to settle suits or actions due to a~ciation with thtjCity, subject to certain restrictions. The City has purchased liability insu,rance to mitigate jthe cost of any potential future suits or actions. The term of the indemnif\i'atiOfl.iSP,ot exp~icitly defined, but is limited to the period over which the indemnified party ~rved as an emp~0yee or elected official of the City. The maximum amount of any potential)'uture payment c}limot be reasonably estimated. I I , / (iii) The City has entered into agreements th~may include ingemnities in favour of third parties, such as purchase and sale agreements/confidentiality agreements, engagement letters with advisors and consultants, outsourci~' agreements, le~ng contracts, information technology agreements and service agreements;, These indemnification agreements may require the City ~o compensat~ counterparties. for)osse~\ing~red bi ~he ~ounte~parties as a result of ?reaches 111 representatlon and regulatJops or as a<rrsu!f of litIgatIOn clanDs or statutory sanctIOns that may be suffered by the coun,terparty as a \~Qns5iquence of the transaction. The terms of these indemnities are not exp)kitly defined ,jJ{d the maximum amount of any potential reimbursement cannot bejeasonably estimJied. The nature of these inde}~fication agreen:ents prevents the City from making a reasonable estimate of the maximunyexposure due to tfie difficulties in assessing the amount of liability which stems from the U~1P edictabV;i!y , of fu'ture events and the unlimited coverage offered to ~ounterparti~s. Hist Ically,tljeCity!)as not made any significant paym~nts under such or simi~ar mdemmficatlOn agy ements ancl)hefe'fore no amount bas been accrued 111 the balance sheet With respect to these 1rcements. I CONTlNG,N'T LIABILIr 1" ,/ L At/gat/of! / /,' Tbe tity' bas b, c,efl nJ ed as a defendant in celiain legal actions in which damages have been soyght. The outc le of these actions is not determinable as at the date of reporting and cordingly, nopr vision has been made in these financial statements for any liabilities which may res ul 1. / / ~. THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31, 2006 /1' I / I GUARANTEES / / '~ 17. / M~ocument In ??ll City of Plckenng Notes (' 7/10/07 317 PM / FOR DISCUSSION PURPOSES ONLY / Page 17 of21 <-:t -1'-- / THE CORPORATION OF THE CITY OF PICKERING Notes to the Consolidated Financial Statements December 31. 2006 , / / I // / / / , / I" / / / / / , The approved operating and capital budgets for 2006 are reflected on the Con:>blidated Schedulel of Operating Fund Financial Activities and Fund Balance, Consolidated Scl)edule of Capita1lund Financial Activities and Fund Balance, and the Consolidated Statement offinancial Activiti,tts. The budgets established for the capital fund operations are on a project-orien~ed basis, the cost;ylof which may be carried out over one or more years and, therefore, may not be/comparable with/the current year actual amounts. As well, the municipality does not have a budtet for activity; w~in Reserves and Reserve Funds, ""ith the exception being those transaction;/which flow through either the operatmg or capital fund budgets. Budget figures have been rec1assified for7he ~rposes of these statements to comply with PSAB reporting principles. // 1/ / / I / / / / II ')I / I / / I II / / / M~ocument m ZeIl City of PIckering Notes ( 7/10/07 317 PM / FOR DISCUSSION PURPOSES ONLY / / / / , / / ~i;.'; 18. BUDGET FIGURES ~y / Page 18 of21 ,~ I I THE CORPORATION OF THE CITY OF PICKERING Consolidated Schedule of Operating Fund Financial Activities and Fund Balance Year ended December 31. 2006 Schedule 1 REVENUES Residential and farm taxation Commercial and industrial taxation Taxation from other governments LJ ser charges Government grants and fees Developer contributions and donations Investment income Penalties and interest on taxes Fines Interest on promissory notes Other Total revenues EXPEND ITLJRES General government Protection to persons and property Transportation services Environmental services Stlcial and family services Recreational and cultural services Plannin and develo men! Total expenditures NET REVENUES / Budget 2006 Actual " / 2005 Actual I / 26A7.t,748 / $ 26,111,967 $ $ 26,52,8,006 6,545,118 6;683,041 6$89,020 6,887,159 /6,937,311 ~6"" ..,..,.., , ~_),.J.J.J 7,984,589 / / 8,951,432 , 7,] 9.t 785 360,717 I 352,672 568,040 I 2,00, 98,443 / 113,775 605,0 ],404,5~/ 874,684 ],380 00 1,698,2 3 1,534,795 5 ,000 59r,34 ] 550,611 ] 52,220 q05,244 L 905,244 ;1,15&;922 /591,612 4,1>39,315 153,387,{:9'2 , /53,930,955 60,878,255 I' 15,302,98] 9,377,042 12,117i 14,677,0 ]3,513,808 12,977,758 5,63~ 32 5,308,877 12,165,029 ,)9,619 46,718 42,682 ,158,552 333,056 348,748 )6,708,378 16,047,858 15,068,380 / 2,724,862 ],928,424 1,749,085 52,161,586 52,48 1,722 51,728,724 1,226,]06 ] ,449,233 9,149,531 820,000 2,460,000 (2,469,]28) (2,668,858) (5,968,131) 2,] 21 ,061 ],131,597 (1,671,640) (1,808,039) (847,000) (807,000) (1,095,381) (1,110,725) (262,567) 321,J J2 10,700 8,400 (229,227) (9,220) (1,336,] 06) (1,500,736) (9,237,204) (110,000) (5],503) (87,673) 110,000 1,271 88,944 $ $ (50,232) $ 1,271 / / FINANCING AND TRANSFERS II Dividend from Veridian Corp ation. Transfers to Capital Fund/ ):. / Transfers from (to) Rescl es andR~sei\T-'eFU' as Increase (decreasc) in ~ounts to be recov 'ed Principal repaymq1t of debentures Principal repaY9'{ent of internalloaJ}' WSIB bcnefiy(iabilities / post-cmplojinent benciit liabilj{y Decrease in ~)n financial asset / / . / - / '. \', ClIANGE IN OPERATING rGND BALANCE I' OPE TING FUND B "ANCE, EGINNING OF ~AR PERA TING FUND BALANCE, END OF YE'\i / / Page 190f21 Worksh et In 2210 City of Pickering F5 (#102739) 7/10/20013.18 PM I / FOR DISCUSSION PURPOSES ONLY / I / //' / I / / / / ",":'i' ,---, THE CORPORATION OF THE CITY OF PICKERING Consolidated Schedule of Capital Fund Financial Activities and Fund Balance Year ended December 31, 2006 II / / / / / / I Schedule 2 --~ / / / / 2006 / Actual / / / / / I / / / REVENUES Grants Developer contributions and donations Development charges and developer contributions earned Other Total revenues EXPENDITURES General government Protection to persons and property Transportation services Environmental services Social and family services Recreation and cultural services Planning and development Total ex enditures NET EXPENDITURES / FINANCING AND TRANSFERS L Transfers from Operating Fund Transfers from (to) Reserves and Resc 'e Funds Proceeds from debentures / Proceeds from intcrnalloans Net financin and transfers 2005 Actual / / I / / $ 2,4~,754 $ 17:'bn /42:140 128,219 / I j', / / 1,552,588 / 1,063,284 / 10,545 / 52,259 / 4,441,727 / 1,786,]54 / / 1,280,h6 1,7 ,30~ 1:7~,315 /6. 55i~~0,.,./~;.,. ~A70,541 125'OOO~/ 91,493 211,000'; 14,945 I 2,672,665 1,993,404 I 6,750 / 782 12,824,10Y 8,690,656 , ':;<:/ / ,/.-''-) \1 BAI~0C6=7 / CAPITAL FUND, BEGI ING OF YEAR / CAPITAL FUND, EN OF YEAR $ Worksh et m 2210 City of Pickermg FS (#102739 J 7/10/2007 3.18 PM Budget $ 4,283,118 77,000 1,646,550 (6,81 ,435) / / 2,469,128 648,550 3,013,757 686,000 6,817,435 FOR DISCUSSION PURPOSES ONLY 1,16],949 253,167 6,644,547 15)14 3,207,192 4,411 I] ,286,580 (4,248,929) (9,500,426) 2,668,858 5,968,131 (433,637) 280,407 2,792,000 352,000 287,000 5,379,221 6,535,538 1,130,292 (2,964,888) 4,079,053 7,043,941 $ 5,209,345 $ 4,079,053 ~'.( Page 20 of21 ~' '~ THE CORPORATION OF THE CITY OF PICKERING Consolidated Schedule of Reserves and Reserve Funds Financial Activities and Fund Balance Year ended December 31,2006 / / / II // I .Schedule 3 / / / / I / / / / I I / /"/ (1,13],597) / 433,63 / (697,?60) // / / I'll ;(s'n,211) / ' / <// / 20,725,437 I / $ 20,148,226 REVENUES Developer contributions and donations Investment income NET TI0'\NSFERS FROM (TO) OTHER FUNDS Operating Fund Ca ita] Fund Total net transfers CHANGE IN RESERVES AND RESERVE FUND BALANCE RESERVES AND RESERVE FUNDS, BEGINNING OF YEAR RESERVES AND RESERVE FUNDS, END OF YEAR / -:-.. ./ ';1 / ;1 / / /1 / ;/ / / / / / W","hIIO Cdy of Nk,mg (5 (#102739) 7/10/2007 3" PM / FOR DISCUSSION PURPOSES ONL Y I 2006 I Actual $ / / 76,495 /94,254 120,749 2005 Actual $ / / I 3448 /70,848 / I09,296 1,671,640 (280,407) 1,391,233 1,500,529 19,224,908 $ 20,725,437 Page 21 of21 'A-,"~""'~ *~ ~." ~~ ~' t'''-, r"t .~ ~., ~' ~' I / / / I / / / I I / / I' I II / t, II / ~> / / /1 / CITY OF PICKERI~ / PUBLIC LI8RAR/ BOAR~ December 31,2006 / I / ~)(0 II I \0/ / I / / . / / I I / MC Document in 2211 City of Pickering Public LIbrary Board ( 7/10/07 12:34 PM FOR DISCUSSION PURPOSES ONLY / / / I I / / / / / / / / / / / / / / Ii / I ~ "fii --"J 1"iJ'....r !."hj'"llr rn <"I T...---"h~w-- Yl"'fj:,' T / / / Auditors' Report I I Deloitte & Tou(he LLP 5140 YongeStreet Suite 170Q/ Toronto ON M2N 6L7 // Canadal / I / Tel,/416-601-6150 / F9'x: 416-601-6151 I www.deloltte.ca I / / II / / / II / / it / / v~ // / I / ,I ;; / We have aud;ted the stalement of financ;aI pos;t;on Oft~C;ty ~'ked1pUb];C Library Board as at December 31, 2006 and the statement of financial acti/ities ando~ h~k~ce for the year then ended. These financial statements are the responsibility of ,the Board's man%ement. Our responsibility is to express an opinion on these financial statements bY on our audit. / We conducted our audit in accordance :;:ith canadiaX~erallY accepted auditing standards. Those standards require that we plan and PYfor~~_ Q_~udit t obtain reasonable assurance whether the financial statements are free of matelrial I] lsstatel e)t>/A audit includes examining, on a test basis, evidence supporting the amounts and d' closures i \3he ,financial statements. An audit also includes assessing the accounting principles u d and signi'fica t estimates made by management, as well as evaluating the overall financial stateryent presentation. / In our opinion, these financial sta1ements present fairly, in all material respects, the financial position of the City of Pickering Public L~~a 'f Board as ~December 31, 2006 and the results of its operations and the changes in its financial ,-bs' ~~L~he,ar then ended in accordance with the Canadian generally accepted accounting principles. ~--J / / Chartered Acc~nts Licensed pU~CGCQuntants Toronto, ntario~ March 2007 / / / ~. To the Members of The City of Pickering Public Library Board, Members of Council, Inhabitants and Ratepayers of the City of Pickering .~"" M~ocument In 2i?ll City of Pickering Public Library Board ( 7/10/07. 12/34 PM / FOR DISCUSSION PURPOSES ONLY <~' CITY OF PICKERING PUBLIC LIBRARY BOARD Table of Contents December 31, 2006 / I I / / / / I / / / /// / II 1/ / I? / IU~// / / / // // / /~/ / I / I I~ / / '\0;:::::; I / \'0 / / 1 /~I / / ~ Statement of Financial Position Statement of Financial Activities and Fund Balance Notes to the Financial Statements ~- /Documentln 2211 Cdyof Pickering Pubilc LibroryBoord (7/10/0712:34 PM FOR DISCUSSION PURPOSES ONLY / / / / / / / / ,/ Page 2 3-5 ~'U ., CITY OF PICKERING PUBLIC LIBRARY BOARD Statement of Financial Position December 31,2006 / , , / / / / I / / I I I / ,I / / I /' -* I I 2005 II I / ,II /"060 / 231 / 2,291 FINANCIAL ASSETS Cash Accounts receivable LIABILITIES CURRENT Accounts payable and accrued liabilities Due to the Government of Canada Due to City of Pickering Post-employment benefits obligation (Note 3) NET FINANCIAL LIABILITIES NON-FINANCIAL ASSET Prepaid expense NET LIABILITIES BOARD POSITION AMOUNTS TO BE RECO ~ Workshee't in 2211 City of Picker/fig Public Library Board (#106457), 711012007' 12:30 PM / FOR DISCUSSION PURPOSES ONLY 2006 $ I / / 8,~ 6~554 1i3,000 198,940 (196,364) 73,364 $ (123,000) $ (123,000) $ 17,668 243 74,918 128,800 221,629 (219,338) 90,538 $ (128,800) $ (128,800) ~-- Page 1 of 5 -~ CITY OF PICKERING PUBLIC LIBRARY BOARD Statement of Financial Activities and Fund Balance Year ended December 31,2006 I / / , / / / 2006 Budget / Actual / , , REVENUES City of Pickering grants - operating City of Pickering grants - capital Federal grants Province of Ontario grants Fines and other receipts $ 4,009,777 118,465 $ 3,95425 ,140/UO / ~~lt4 / 1((9,72~ I 196,910~> / 4,421,004 / / I / / I 2 82,430 531,921 3,114,351 EXPENDITURES Operating Salaries Salaries and wages Fringe benefits Material, supplies and utilities Books Utilities Other supplies / / / / I 51~'35 219, 2 4, ,300 80,652 526,327 205,422 49,125 780,874 ~- 189,704 40,131 11,817 10,103 11,885 4,183 5,509 58,509 14,806 15,228 361,875 4,257,100 140,930 4,398,030 22,974 Services Repairs and maintenance I nsurance I Travel I Consulting & Professiona Advertising /' ~~, Conventions <Q ~:7 Postage ~ Telephone Seminars and e ucation Miscellanea / 220,082 41,092 10,872 16,600 7,275 8,045 4,706 54,327 9,050 15,663 387,712 4,311,824 118,465 4,430,289 -~'Wt" Total opera~ilig expenditures / ~~ Capital ~xpe lture' ot ) Total penditu ~ / NET EVENUES (E'X ENDITURES) A(Di~REASE) INC~ 'ASE IN AMOUNTS TO BE RECovERED / (DECREASE) tNCREASE IN NON-FIN NCIAL ASSET CHANGr N FUND BALANCE FUND/BALANCE, BEGINNING OF YEAR FU 6 BALANCE, END OF YEAR $ $ (5,800) (17,174) Workshe tin 2211 City 0 f Pickering Public Library Board (#106457). 7/10/2007' 12.'30 PM FOR DISCUSSION PURPOSES ONLY / 2005 Actual / / / $ 3,78~;87~ 2j4,47"- /10,399 / 130,425 / 196,852 4,40 1,024 2,510,323 520,522 3,030,845 540,204 177,551 41,298 759,053 264,224 32,622 10,699 ]0,520 7,102 4,093 5,113 51,941 9,033 9,609 404,956 4,194,854 274,472 4,469,326 (68,302) 600 67,702 $ Page 2 of 5 / I / / / II ,,,-j~. -r - -~ ~. c~V'-~ o " CITY OF PICKERING PUBLIC LIBRARY BOARD Notes to the Financial Statements December 31,2006 / / / / I / / / / / 1. / / / / / / / / SIGNIFICANT ACCOUNTING POLICIES I / / / The financial statements of the City of Pickering Public Library Board (the ylibrary Board"vfre the representations of management prepared in accordance with C~o/C1iaJ)> generally ;1ccepted accounting principles for local government established by the Pub~ s/~ -Acc071 "ng Board (PSAB) of the Canadian Institute of Chartered Accountants. / ~ ~ / / Significant accounting policies adopted by the Library Board are; follows: II / / Basis of accounting / / (a) Accrual basis of accounting /~~k / Revenues and expenditures are reported on theJcrua . / is of ~mting. The accrual basis of accounting recognize revenues as they;are earned d ;measurable; expenditures are recognized, as they are incurred and measuplhle as a result o,tlhe receipt of goods and services and the crcation of a legal obligation 'j" / (b) Tangible capital assets . / The .historical cost and accumul,~ a~~.i7';:1tiO. n f~r tangible capital assets are not recorded for Library Board purposes. y,ngible c 'taYa~ts acquired during the year are reported on the s.t~t~ment of financ7'al ac lvities and7alance as capital expenditures in the year of acqUIsItion. (c) Post employment bene s The present value o~~ cost~~f ~Viding employees with future benefits programs is recognized as e 10t~~S grn thes entitlements through service. Actuarial gains or losses are amortized on straig me==b IS over the average remaining service period (ARSP) of employees. e actuary ~;<ed ARSP to be 16 years. (d) Use of e lmates / The ~paration of fi~ncial statements in conformity with Canadian generally accepted acJ&mting princi~le requires management to make estimates and assumptions that affect the !tpog. ount 0 assets, liabilities and the disclosure of contingent assets and liabilities at the o. e financial statements and the reported amounts of revenues and expenditures during t tilej6d. Actual results could differ from those estimates. CAPIT AL E P{NDITURES / / I Page 3 of5 Capital ex nditures were incurred to acquire furniture and equipment in the amount of $140,930 (2005 - $ 74,472). M Document in ZZl1 City of Pickering Public Library Board ( 7110107; 12..34 PM FOR DISCUSSION PURPOSES ONLY // / ~,,- 1/ /1/ / / / / / I / / I / / / , / The Library Board makes available to qualitying employees who retire ~efore the age of ~5, the opportunity to continue their coverage for such benefits as extended he;rlth,-and drugs. y6verage ceases at the age of 65. Dependent on eligibility, health coverage/fnaY<~ a sharecV financial resp~nsibility ?ctween the Library Boa~d and the retired ~mpl?y~es. .,{D~~~rary/Board also provIdes full time and permanent part-tIme employees a sIck tl!lle entitlement and any unused entitlement is accumulated year to year. This accumulated entitJement is not ves}ed and therefore does not get paid out at the time of retirement or termination. U{e most recent ac 6arial valuation of the post-employment benefits was performed at January 1, 2~. fnformation about the Library Board's post employment J~ts liabilities' as follo,^,s: / ~ 1/ 2006 Post-employment benefits liability, beginning of year /$ 128,800 Expense for the period II 14,900 Amortization of actuarial loss / / 800 Interest expense / / 8,400 Benefits paid during the period, (29,900) Post-employment benefits liability, end;6fYME~ / $ 123,000 -- 1/ ~F--J/ , ;;, / Accrued post-employment benyfits obligation $ 132,700 Unamortized actuarial loss I (9,700) Post-employment benefits liability $ 123,000 The main actuarial a~n~7PIOY d in the actuarial valuations are as follows: (a) Discount ra/ The prc~t value as at ~cember 31, 2006 of the future benefits was determined llSll1g a disco~rit rate of 6.0%. I (b) De~l ~~~t A ('~t en cost at January I, 2004, the date of the most recent actuarial valuation was I 4.5% pe~ u . (c) .~. CITY OF PICKERING PUBLIC LIBRARY BOARD Notes to the Financial Statements December 31, 2006 3. POST EMPLOYMENT BENEFITS OBLIGA nON '-'~. 2006 I / / I / I I I 2005 $ 128,200 14,100 800 8,500 (22,800) $ 128,800 2005 $ 139,300 ( 10,500) $ 128,800 Health osts were assumed to increase at ] 0% in 2005 and decrease by 1 % increments per year to an ltimate rate of 5% per year in 20 I 0 and thereafter. / / M Document '" 2211 City of Pickering Public Library Board C 7/10/071234 PM FOR DISCUSSION PURPOSES ONLY / Page 4 of 5 CITY OF PICKERING PUBLIC LIBRARY BOARD Notes to the Financial Statements December 31, 2006 ;/ / / / / / / / I / / / / 4. PENSION AGREEMENTS / ,/ The Library Board makes contributions to the Ontario Municipal Emp}6~ees Retireme~V'/Fund (OMERS), which is a multi-employer plan, on behalf of eligible memberi o(~s staff. The/Plan is a defined benefit plan that specifies the amount of the retirement b;;fefWe received by the employees based on the length of service and rates of pay. /. '''~ I / / Contributions in the amount of$143,143 (2005 - $125,264) welpaid to Orv7ER ~n behalf of its members during the year. / STATEMENT OF CHANGES IN FINANCIAL POSI1~N / A statement of changes in financial position has not;fee'Z~nted, ~e related information is readily determinable from the financial statements p;isented~ / / I :u::t::c::~:ou"e of business, the L Buacd c?/nto agccements, which contain guarantees. The Library Board's primary~uarantees are as/follows: (i) The Library Board indemnifies n:Plo~~.rtta=bo)il~ members for various items including, but not limited to, all costs to se Ie suit~ o~tio s due to association with the Library Board, subject to certain restricti?~ . The Library Bard has purchased liability insurance to mitigate the cost of any potenti<;r. future suits or ctions. The term of the indemnification is not explicitly defined, butjS limited to the p riod over which the indemnified party served as an employee or board ~ember of the Li~rary Board. The maximum amount of any potential future payment can~ o~easonabl)j,e'stimated. (ii) The Library B rd ha~2k-:ed'i~'agreements that may include indemnities in favour of third parties, such s purchas~d ale agreements, confidentiality agreements, engagement letters with advi rs and consul' nts, outsourcing agreements, leasing contracts, information technolo agreements a Ci service agreements. These indemnification agreements may requir the Library Bard to compensate counterpatiies for losses incurred by the cou erparties as a r 'ult of breaches in representation and regulations or as a result of li~ atiQQ claims or statutory sanctions that may be suffered by the counterparty as a 9<m#~~of th transaction. The terms of these indemnities are not explicitly defined and /the llta~ au ount of any potential reimbursement cannot be reasonably estimated. Jhe nature of t se indemnification agreements prevents the Library Board from making a / reasonable esti ate of the maximum exposure due to the difficulties in assessing the amount of / liability, ~~ stems from the unpredictability of future events and the unlimited coverage offered to counter~~ies. I listorically, the Library Board has not made any significant payments under such or sim~i:l:r mdemnification agreements and therefore no amount has been accrued in the Statement of Finan,S>u1 Position with respect to these agreements. 5. 6. Page 5 of 5 M Document In :?:?ll Cityaf Pickering Public LIbrary Boord ( 7/10/07. 1:?'34 PM FOR DISCUSSION PURPOSES ONLY / / / ,I / / I / / / ,/ / ~";' ~- ~ .~ I / /' / / / I / II} I IIi I (/~~ / ~) / / I Financial Statements of I THE CORPORATIO~~ THE CITY OF PIC/KERING TRUST FUNDS 1/ I December 31,2006 / / / / / / / /~ ~, / ~/ / Me Document in 22108 Proforma Trust Notes ( 7/10/07, 1.02 PM FOR DISCUSSION PURPOSES ONLY / / I / / / / / /1/ ,,- - ~)' , "r .~d. ~ 11\ .. ~-..~--- v. 'c". / / / ,/ / / / / / / / / Deloitte & TmIche LLP 5140, Yonge"Street Suite 170,0 Toronto/ON f'12N 6L7 CanadB Tel (416) 60,1-6150, II !?ax: (416) 60,1-6151, /www.deloitte.ca/. / / /:z / / ~/ To the Members of Council, Inhabitants and Ratepayers / / I / of The Corporation of the City of Pickering / / We have audited the statement of financial position of the Tr t unds of the ctporation of the City of Pickering as at December 31, 2006 and the statement of fin9~~( <jOities a~ fund balances of the Trust Funds for the year then ended. These financial statements;ii:re the re ~ sibjrlty of the City's management. Our responsibility is to express an opinion on these finantial statements bred on our audit. We conducted our audit in accordance with Lnadian genlJ."~~ accepted auditing standards. Those standards require that we plan and perfo;j an audit to ob.tain reasonable assurance whether the financial statements are free of material miss~tement. An auJift includes examining, on a test basis, evidence supporting the amounts and discloturl"":::~'nJbe fimj.ricial statements. An audit also includes assessing the accounting principles used jnd sig \. ant ~imates made by management, as well as evaluating the overall financial statement presentation. / In our opinion, these financial state~ present fair~(;n all material respects, the financial position of the Trust Funds of the Corporatio of the City of ~(ckering as at December 31, 2006 and the results of operations and cash flows of t e Trust Fundsfx{r the year then ended in accordance with Canadian generally accepted accountin~ ri~es. /1 /y Chartered Accou ants / Licensed Public :A:countant/ Toronto, 0)1 ari<<-=-~ AP'j0071 Auditors' Report -~ Ie Document In 22108 Proforma Trust Notes (7/10/07; 1.02 PM FOR DISCUSSION PURPOSES ONLY ,~ .~ / / 1 / THE CORPORATION OF THE CITY OF PICKERING TRUST FUNDS Statement of Financial Position December 31. 2006 FINANCIAL ASSETS Investments Interest receivable Loans receivable TRUST FUND POSITION $ ,I' /' ~O) /~~ I / ~/ / / OHRP 2006 Dorothy Card Estate I / TotaY $ I" /~ $ 256,674 /I{ '~'74 $ 8,222 ~:~ / / 3,671 / $ 264,896/ $ 268,56l $ II I $ 2 4.8 $ ts,567 I ~~/ / / ~") / / / 1/ / I ' . <0>~ I ,\ ~ ----...-. / '~<J / / $ 3,671 3,671 3,671 / / Worksh et 111 2210A Proforma Trust - 2006 (#106459)- 7/10/2007; 1.01 PM I FOR DISCUSSION PURPOSES ONLY 2005 / I / Total / / / / / 250,414 5,077 5,294 260,785 $ 260,785 Page 1 of 4 /1 II'.~ 1 ,I I / I 1 / 2005 I / / j I Total Total/ / 1 II I ,;$ ;(9,641 $1 7,222 u~ / 1,766/ ~ THE CORPORATION OF THE CITY OF PICKERING TRUST FUNDS Statement of Financial Activities and Fund Balances Year ended December 31, 2006 OHRP 2006 Dorothy Card Estate REVENUES Interest $ 9,405 $ 236 EXPENDITURES Provincial payments Administration charges / _/ 1- / 1,766 93 1,859 ,859 ~405 /7,782 ", / / 2~9,1 260,785 $ 26~6 $ 268,567 NET REVENUES (EXPENDITURES) (1,623) / I 5,294 $ ~71 1 / / / 0~:>_~ / / \V(---j / / 'i / / ~/ Q,-~ I Ii ~/ / / / 70rkSh et In 2210A Proforma Trust - 2006 (#106459)" 7/10/2007; 1:01 PM FOR DISCUSSION PURPOSES ONLY FUND BALANCES, BEGINNING OF YEAR FUND BALANCES, END OF YEAR / / / / / / / / / / 1,706 90 1,796 5,426 255.359 $ 260,785 '~~; Page 2 of 4 "~ _/ / " / THE CORPORATION OF THE CITY OF PICKERING TRUST FUNDS Notes to the Financial Statements / / / / / // / / / / 1. / / / / / / / 1/ The financial statements of the Trust Funds of the The Corporation of the ~ity of Pickering/are the representations of management prepared in accordance with Canadi5l{)> generally /;lccepted accounting principles. / <I~ // / "~/ / / / / / / Basis of accounting / / Revenues are recorded in the period in which the transac~ or events oc~ed that gave rise to the revenue. L II / /( /)/ Expenditures are reported on the accrual basis of ac. untin~f1ich rep6gnizes expenditures as they are incurred and measurable as a result of the rece~Pt of go~ds~erVlces and the creation of a legal obligation to pay. / / Investments / / Invcstmcnts arc "c",ded at cost. The e~i~~estments~roximates their [air market value. [he of "lima/e.v / ~:) / The preparation of periodic fin~cial statement:/conformity with Canadian generally accepted accounting principles requiri management t~/ make estimates and assumptions that affect the reported amounts of assets rd liabilities anfdisciosure of contingent assets and liabilities at the date of the financial statyments and Ir~~::Z:d amounts of revenues and expenditures during the period. Actual results cyi<<JtrT~r/se "timates. ONTARIO HO~':NEW~ PI}OGRAM The Ontario fi6me Renewal py~ram ("OHRP") was established by the Ontario Ministry of Housing in 1;9"73 to provide gJiclnts for municipalities to make loans to assist owner occupants to repair, reha)1llitate and impro/e their homes to local property standards. Individual loans are limited to S7,500;tfwhich the maJlmum forgivable portion is $4,000. Effe~~ 199/'the Province of Ontario discontinued this program. Unused fonds were rel)'~tted totn~~6'rice on March I, 1994. Outstanding balances of loans issued prior to July 16, I 93 will continue 0 be administered under the terms of the original program. The City continues to administer tl) collection of any outstanding loans and remit the proceeds, net of a 5% administraZion tee to the Ministry of Municipal Affairs and Housing. "OHRP" ans receivable at December 31, 2006 are comprised entirely of repayable loans of $3,671 kio05 - $5,294). In the event of the sale or lease of the home or in the event of the home .(yner ceasing to occupy the home, the balances of the repayable loan immediately become due nd payable by the homeowner. December 31, 2006 / / ACCOUNTING POLICY Significant accounting policies adopted include: 2. Page 3 of 4 / / FOR DISCUSSION PURPOSES ONLY c.... "'R>y~'~' ~'i"" -~ - - -,--", / THE CORPORATION OF THE CITY OF PICKERING TRUST FUNDS Notes to the Financial Statements I I / I / / I I / 4. / ~"' i I / / / I / I / I / The City of Pickering has established a trust fund for the Dorothy Cardl~tate for the ca.' and upkeep of the destitute elderly. The fund balance is comprised of in,:~t~nts and acc/l~ulated interest amounting to $264,896 (2005 - $255,491). II~" // / '~ / STATEMENT OF CASH FLOWS / / A statement of cash flows has not been presented as the infoLation is readitydeterminable from the information provided. JIll( I /~/ / / / / I / / (\~:>- ... / /1 / / /~ / /~I / /~ / / / / / December 31, 2006 / I / / / / / 3. DOROTHY CARD ESTATE ,I ~~; ~, M Document in 2210B Proforma Trust Notes ( 7/10/07; 104 PM Page 4 of 4 FOR DISCUSSION PURPOSES ONLY