canadian seed growers’ association 2015-16 annual report · 2019-11-10 · csga 2015-16 annual...

Canadian Seed Growers’ Association 2015-16 Annual Report

CSGA2015-16AnnualReport

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CSGAMission.................................................................................................................................3CSGAObjectives.............................................................................................................................4StrategicOutlook............................................................................................................................52016AnnualGeneralMeeting.......................................................................................................7MembershipandAcreageReports...............................................................................................12OurBoard.....................................................................................................................................15OurCommittees...........................................................................................................................18OurFinancialStatements.............................................................................................................20


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CSGAMissionCSGA’sMissionStatementisto:Representmembersby:

• Advancingagrowerperspectiveonissuesrelatedtoseed;• Providingleadershiptomembersandengaginginactivitiesdesignedtogivemembersa

voiceonseedrelatedmatters;and• Supportingmembersingainingandmaintainingknowledgeofseedcropcertification.

Advancetheseedindustryby:

• Promotingthebenefitsofpedigreedseedthroughouttheseedindustryandtoend-users;

• Advocatingtheuseoftheseedcertificationsystemasanintegralpartofidentitypreservedandqualityassuranceprograms;

• Cooperatingwithresearchers,growersandprocessorstoexpandtheuseofpedigreedseed;and

• Facilitatingtransferofend-usespecifictraitsfromresearchtocommercialusethroughpedigreedseed.

Provideseedcropcertificationby:

• Developingvarietalpuritystandardsandregulationsforpedigreedseedcropproduction;

• Maintainingaverifiableseedcertificationsystem;and• Certifyingthevarietalpurityofpedigreedseedcrops.


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CSGAObjectivesTheobjectivesoftheCanadianSeedGrowers’Associationare:

1. Toensure,andcertifyto,thevarietalpurityofseedproducedbyitsmembersandtomaintainthepedigreethereof.

2. Toidentify,andcertifyto,forpurposesotherthanfurtherpedigreeing,thevarietalpurityofseedproducedfromsuperiorpropagatingmaterial.

3. Toencouragethedevelopmentandintroductionofsuperiorvarietiesandstrainsofplants.

4. TodevelopprogramswhichexpandtheuseofPedigreedSeedforincreaseddomesticcropproductionandforexport.

5. Generallytocontributetotheestablishmentandmaintenanceofhighstandardsinyieldandqualityofagriculturecrops.

6. Toco-operatewithotheragencieswhichhaveaninterestinseedproduction,promotionanddistributionbothinCanadaandabroad.

7. TocoordinatetheendeavoursofPedigreedseedgrowerswiththoseofplantbreedersandcropproducersingeneral.


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StrategicOutlookRisksandOpportunities

• Newtechnologies,businessenvironmentandsociallicenceissues.Newtechnologiesandevolvingbusinesstrendswillcontinuetodriveandchangethebusiness.Technologieswillaffecthowweoperateinthefieldandhowweorganizetheinformationofourbusiness,withradicalchangesinhowCSGAmembersinteractwiththeentirecertificationsystem.Inadditionsociallicenseissuesareanemergingconcernthroughouttheagriculturesector.Seedgrowersmustbemindfulofmaintainthetrustandconfidenceof(domesticandinternational)consumersandpolicymakers.

• CFIARegulatoryModernization–PotentialNewDirections,NewRisks,NewOpportunities–Whopays?WeknowthatCFIAwillbelookingatregulatorymodernization,andCSGAwillhaveasignificantopportunitytoinfluencefuturedirectioninthisarea.Thiswillrequireustohaveaclearpictureofourpositionsothatwecaneffectivelyworkwithgovernment.Amajorissueisastablesourceoffundingfortheindustry,inthewakeofaprogressiveoffloadingofresponsibilityfromgovernmenttoindustry,butwithoutconcomitantdelegationofresources.

• SeedSectorValueChainRoundTable–bringinggovernmentandindustrytogether.SeventhmeetingheldMarch1-2,2016.Theroundtablediscussedawiderangeofissues,fromuserfees,tobeehealth,totradeagreements.Fullrecordofdecisionandactionitemsisavailableathttp://www.agr.gc.ca/eng/industry-markets-and-trade/value-chain-roundtables/seed/seventh-meeting-of-the-seed-sector-value-chain-roundtable-record-of-decision/?id=1470443639323

• SeedSynergyProject–PotentialNewPartnerships,NewRisks,NewOpportunities.TheemergingSeedSynergyProject,withCSGA,CanadianSeedTradeAssociation(CSTA),CanadianSeedInstitute(CSI),CommercialSeedAnalystsAssociationofCanada(CSAAC),CanadianPlantTechnologyAgency(CPTA)andCropLifeCanadarepresentsanopportunityforustorethinktheseedsystem,andhowweorganizeourselves.Thepotentialforpartnershipisgreat,astherearemanyareaswherethevariousSynergyorganizationsmightassistoneanother.Theprimaryriskinthisareaisnotacting:withoutactionwemightnotadapttochangingcircumstancesandfindourselvestryingtoupdatetheseedsystemtoofardowntheroad

CSGAActionPlan

• PreparingfortheFutureTogether–StrategicPlanningOptionsAssessment.ThetimeisrightforanewCSGAStrategicPlanthatwillchartthefuturefortheorganization.TheBoardhasassessedseveraloptionsandgivendirectionforacomprehensiveplanningprocesswhichincludesdirectmemberengagement.

• BuildingarelationshipwiththeNewGovernment–consideringnewoptions.Thenewgovernmentisfocusedheavilyonconsultationandengagementwithstakeholders.ThisprovidesCSGAwithacriticalopportunitytobuildstrongrelationships.


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• IndustryPartnerships–StrengtheningOldAlliances,BuildingNewOnes.MoveforwardtheSeedSynergyCollaborationProjectagenda.

• Investinginourcorebusiness–ModernizingCircular6andrelatedprocesses.ChangesinbusinesspracticesandtechnologiesrequireustotakeadetailedlookatCircular6toensurethatitmeetstheneedsoftoday’sseedgrower,andiseasytounderstandandimplement.

• StrengtheningtheFundamentals(IT,HR,Finance,Accounting,Planning,Reporting).AllofCSGA’sstrategicagendadependsuponcorefundamentals.Forexample,ITinvestmentwillbecriticalforenablingthetypeofsimpleandseamlessinformationinfrastructureandserviceexperiencethatseedgrowersexpect.

GoingForward

• BuildourPolicy,PlanningandGovernanceCapacity

• ImproveClientService–Metrics,Automation,Communication

• Buildonourstrengths–Staff,IT,Membership,Board,Branches

• BuildaSharedvisionofa“NextGeneration”SeedSectorwithourSeedSynergypartners.

• EngageGovernmentandconfirmtheircommitmenttoalongtermpublic-privatepartnershipinseed.


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2016AnnualGeneralMeetingTheCanadianSeedGrowers'Associationheldits2016AnnualGeneralMeetingattheElkhornResort,ClearLake,Manitoba,fromJuly4-9,2016.Minutesfromthe2016AnnualGeneralMeetingfollow:

Canadian Seed Growers' Association Annual General Meeting

Elkhorn Resort, Clear Lake, Manitoba July 4th - 9th , 2016

The meeting opened at 8:15 am with opening Remarks & Official Welcome from Norm Lyster. N. Lyster requested a Moment of Silence to remember those members who died in the past year Adoption of minutes from 2015 AGM Motion: - that the minutes of July 9 and 10, 2015 meeting be approved as posted to the CSGA website Moved by Lorne Fell Seconded by Jonathan Nyborg Carried Introduction of Resolutions Committee Jim Bailee introduced the Resolutions committee, Joe Rennick, Dale Connell, and Jonathan Nyborg with resolutions closing at mid-night on Thursday, July 7. Board of Directors Report Kevin Runnalls, 1st Vice President presented the Board of Directors report.

President’s Report Norm Lyster presented the President’s Report. Financial Report Glyn Chancey presented the financial report. Motion: to approve the financial statements. Moved by K. Runnalls


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Seconded by André Lussier Carried Motion: that KPMG be appointed auditors of the Association for the ensuing year, at the remuneration to be set by the Board of directors. Moved by Lorne Fell Seconded by Roy Klym Executive Director’s & Acreage Report Glyn Chancey presented the Executive Directors report and the 2016-2017 budget. Canadian Seed Institute (CSI) Report Roy van Wyk presented the CSI Report. Canadian Food Inspection Agency (CFIA) Report Anita Gilmer presented the CFIA report. Industry Panel An industry panel session was held with Shawn Brook from Issues Ink as the moderator. Panelists included Industry Partners; Brent Derkatch, Peter Entz, and Michael Scheffel, CSGA staff; Caroline Lafontaine, Doug Miller, and Randy Preater, and seed growers; Quentin Martin, Craig Riddell, and Cathy Fedoruk. Speaker 1 Dr. Patti Rothenburger introduced guest speakers Chris and Lawrence Warwaruk from Farmery Estate Brewery, a privately owned brewery based out of Neepawa, Manitoba. Industry Panel Synopsis Shawn Brook moderated a follow up discussion with the Industry Panel. Speaker 2. Rick Rutherford introduced Guest speaker Eduardo de la Sotta from Curimapu. Eduardo de la Sotta addressed the meeting on his work with contra season nurseries in Chile . Awards Gala


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The following award recipients were presented with an Honorary Life membership award: Dr. Ainta Bruléabel Glen Green Don Pollock Harold Rudy The following award recipients were presented with a Robertson Associate award: Randy Court Gerald Girodat Craig Riddell John Smith The following individual was presented with a Clark-Newman-Clayton award Dr. Brian Rossnagel. 2017 Summer Meeting Next year the meeting will be held in Halifax, Nova Scotia with the Canadian Seed Trade Association. Entertainment Magic/Illusionist Dean Gunnarson entertained the audience. Education and Publicity report Julie Robinson presented the Education and Publicity Report Nominating Committee Report Jim Baillie presented the Nominating Committee report. Retiring director plaques were presented to Jim Baillie, Dawn Pate (not present) and Norm Lyster. Jonathan Nyborg accepted the plaque for Honorary President for Ivan Nyborg. Discussion and approval of budget Glyn Chancey explained the rationale for and presented a proposed membership and

acreage fee increase that had been approved by the Board.


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Motion: to approve a membership fee increase of $100 and an acreage fee increase of $0.15 for 2017-18. Moved by Ron Markert Seconded by Jonathan Nyborg Resolutions Jim Baillie, Chair of the Resolutions Committee received the following resolutions. Resolution #1 WHEREAS: A lot of effort went into making the 2016 CSGA Annual Meeting in Clear Lake, Manitoba a success; and WHEREAS: Numerous organizations provided funds to assist with the financing of the Annual Meeting THEREFORE BE IT RESOLVED: That CSGA extend thanks to all the speakers, special guests, members of the local organizing committee, staff and all level of sponsors for their efforts and contributions to the 2016 CSGA Annual Meeting in Clear Lake, MB and to provide a list of those in the Annual Report. Moved by Kevin Runnalls Seconded by Jim Baillie Resolution #2 WHERE AS: The pension of our employees is important and of significant value to both our balance sheet and cash flow BE IT RESOLVED: That the audit committee of CSGA implement an annual performance review and peer assessment of the fund manager(s) and explore ways to improve performance and reduce risk of the pension plan. Moved by Carl Bolton, OSGA Seconded by Roy Klym, SSGA Resolution #3 WHEREAS: the seed industry is concerned about succession and attracting new entrants to the seed industry, and; WHEREAS: varieties enter and leave the marketplace at a much faster pace today than historically, and; WHEREAS: more flexibility for probationary growers is required. THEREFORE BE IT RESOLVED: that probationary growers be allowed to grow more than one crop kind concurrently within the 3 year probation period with the understanding that at least one crop kind be grown for three years; and


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THEREFORE BE IT FURTHER RESOLVED: that varieties may be changed within the crop kind during the probationary period. Moved by Carl Bolton, OSGA Seconded by Reuben Stone, OSGA Resolution #4 WHERE AS: Circular 6 was originally written in the 20th Century. AND WHERE AS: Circular 6 in its current form has language that is dated and difficult to understand. AND WHERE AS: Technology and innovative production practices have been developed. BE IT RESOLVED: That Circular 6 be updated to recognize new technologies in a clear and concise language for application to the 2017 crop production year. Moved by: Glenn Logan, ASGA Seconded by: Roy Klym, SSGA

Adjournment Motion to adjourn Moved by Dave Wuthrich.


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MembershipandAcreageReportsThefollowingisatablefeaturinghistoricalAcreageandMembershipinformationasofNovember2016,aswellasasummaryofinformationonAcreageandMembershiptrendsovertime.


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OurBoardBritish Columbia David Wuthrich Seed Grower Director Cecil Lake, British Columbia 250-781-3527 [email protected]

Julie Robinson Provincial Government Director Fort St. John, British Colombia 250-787-3241 [email protected]

Alberta Norman Lyster President Seed Grower Director Stettler, Alberta 403-742-4456 [email protected]

Mark MacNaughton Provincial Government Director Lacombe, Alberta 403-782-8033 [email protected]

Ron Markert Seed Grower Director Vulcan, Alberta 204-823-1293 [email protected]

Richard Stamp Seed Grower Director Enchant, Alberta 403-739-2233 [email protected]

Saskatchewan Mitchell Japp Provincial Government Director Regina, Saskatchewan 306-787-4664 [email protected]

Joe Rennick Seed Grower Director Milestone, Saskatchewan 306-436-4353 [email protected]

Bob Rugg Seed Grower Director Elstow, Saskatchewan 306-257-3638 [email protected]

Manitoba Doug Heaman Seed Grower Director Virden, Manitoba 204-748-2666 [email protected]

Patti Rothenburger Provincial Government Director Morden, MB 204-823-1293 [email protected]

Ryan Murray Seed Grower Director Decker, Manitoba


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204-764-2733 [email protected] Ontario Kevin Runnalls 1st Vice President New Liskeard, Ontario 705-622-1870 [email protected]

Dale Connell Seed Grower Director Palmerston, Ontario 519-343-2626 [email protected]

Québec André Lussier Seed Grower Director St-Hyacinthe, Quebec 450-778-2149 [email protected]

Martin Provencher Seed Grower Director Bécancour, Quebec 819-298-4744 [email protected]

Djiby Sall Provincial Representative on Executive Committee Provincial Government Director Quebec, Quebec 418-380-2100 ext. 3327 [email protected]

New Brunswick Jonathan Nyborg 2nd Vice President Seed Grower Director New-Denmark, New Brunswick 506-553-6515 or 506-473-0660 [email protected]

Peter Scott Provincial Government Director Fredericton, New Brunswick 506-453-2108 [email protected]

Nova Scotia Jack van Roestel Provincial Government Director Kentville, Nova Scotia 902-678-7722, ext. 225 [email protected]

Jim Baillie Past President Seed Grower Director Tatamagouche, Nova Scotia 902-890-3419 [email protected]

Prince Edward Island Dan MacEachern Provincial Government Director Kensington, Prince Edward Island 902-836-8932 [email protected]


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Advisors Dr. Bryan Harvey Academic Advisor Saskatoon, Saskatchewan [email protected]

Dawn Pate Ontario Provincial Government Advisor Guelph, Ontario 519-826-3257 [email protected]


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OurCommitteesExecutiveCommitteeJimBaillieNormLysterDjibySallKevinRunnallsJonathanNyborgGlynChancey*GovernanceCommitteeJonathanNyborgJimBaillieDawnPateJoeRennickJulieRobinsonPattiRothenburgerKevinRunnallsGlynChancey*AuditCommitteeAndréLussierJonathanNyborgDjibySallRichardStampGlynChancey*PamColes*AppealsCommitteeDaleConnellAndréLussierMarkMcNaughtonRyanMurrayJonathanNyborgBobRuggPeterScottRichardStampDaveWuthrichGailHarris*DougMiller*AnitaGilmer*

Standards&Circular6CommitteeJimBaillieDougHeamanRonMarkertMartinProvencherJoeRennickPattiRothenburgerKevinRunnallsDjibySallDaveWuthrichCathyBreadner*JimDowney*WillieDrost*AnitaGilmer*TimFerguson*BryanHarveyMikeScheffel*DougMiller*Research&DevelopmentPattiRothenburgerBryanHarveyCarolineLafontaine*MikeScheffel*DougHeamanDanMacEachernRonMarkertMartinProvencherJoeRennickEducation&PublicityDaleConnellMitchellJappAndréLussierRyanMurrayJonathanNyborgDawnPateJulieRobinsonBobRuggJackvanRoestelRichardStampCarolineLafontaine*


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PlantBreeders'CommitteeGayeO’Bertos*DougMiller*Claessens,AnnieCoulman,BruceFalk,KevinGraf,Robert(Bob)Harvey,BryanHume,DaveTownsend,PattyMcElroy,ArtPatel,JayRajcan,IstvanWarkentin,Tom

AwardsCommitteeCarolineLafontaine*JimBaillieDaleConnellDougHeamanRonMarkertJoeRennickMartinProvencherDaveWuthrichHospitalityCommitteeAndréLussierRyanMurrayDaveWuthrich*DenotesCSGAstaffmember


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OurFinancialStatementsThissectionfeaturesathree-yearforecastprojectedfrom2015-16actualexpenditures,throughtothe2018-19fiscalyear,aswellasCSGAauditedfinancialstatementsforthe2015-16fiscalyear,endingApril30,2017.

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Three-YearForecast2015-16 2016-17 2017-18 2018-19Actual Budget Forecast Forecast

MembershipFees 359,200 350,000 700,000 700,000AcreageFees 1,116,335 1,101,675 1,300,500 1,300,000PlotFees 79,260 70,500 70,500 70,500InspectionAssessments 422,632 401,625 381,544 362,467Penaltiesassessed 44,253 40,461 38,437 36,516Industry 18,600 19,200 19,200 19,200OtherCertificationRelatedFees 24,140 19,850 19,850 19,850ASCISFees 263,899 263,060 263,060 263,060SaleofReports 2,553 5,000 5,000 5,000InvestmentIncome 35,955 48,000 48,000 48,000E&PProgramfees&Advertising 40,926 20,300 20,300 20,300GovernmentGrants 167,321 233,591 229,422 159,956BranchContributionstoActionPlan 0 0 0 0AGMRevenue 178,238 125,000 150,000 175,000MiscellaneousIncome 2,058 2,100 2,100 2,100TotalRevenue: 2,755,370 2,700,361 3,247,913 3,218,623


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ComputerSystems 131,268 211,204 218,036 225,073Salaries&Benefits 1,068,944 1,144,235 1,171,498 1,200,293CFIAInspections 402,094 401,625 381,544 362,467ResearchProjects 228 0 0 0ProgramActivities 14,392 0 0 0AnnualMeetingExpenses 165,154 105,370 125,000 150,000Directors'Expenses 282,609 286,067 310,590 314,662Insurance 19,291 25,307 32,353 32,494Memberships 15,196 25,425 25,425 25,425ProfessionalFees 96,451 144,900 125,300 115,300OfficeExpenses 171,359 174,929 176,546 178,188Depreciation 244,929 269,591 239,422 159,956Subscriptions 436 1,000 1,000 1,000Postage 13,497 13,250 12,588 11,958Sponsorships 3,000 7,500 10,000 10,000

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Printing 2,778 5,952 2,203 2,247PromotionalMaterial 2,310 1,500 1,500 1,500Publicity 91,128 45,000 50,230 55,465StaffTravel 73,377 102,802 104,452 106,135BadDebts 3,203 1,000 1,000 1,000ActionPlanImplementation 1,642 240,000 100,000 100,000PensionPlanReserve 100,000 100,000TotalExpenses: 2,803,285 3,206,657 3,188,685 3,153,163

RevenueLessExpenses(NetRev): (47,916) (506,295) 59,227 29,285

NetRevenuePlusDepreciation: 197,014 (236,705) 239,553 160,090DrawFromReserves(Projects): 0 236,705 0 0DrawFromReserves(Operating): 0 0 0 0

Surplus/(Defecit) (47,916) (506,295) 59,227 29,285

Financial Statements of

CANADIAN SEED GROWERS'ASSOCIATION

Year ended April 30, 2016

KPMG LLP

150 Elgin Street, Suite 1800

Ottawa ON K2P 2P8

Canada

Telephone 613-212-5764

Fax 613-212-2896

INDEPENDENT AUDITORS' REPORT

To the Members of the Canadian Seed Growers' Association

We have audited the accompanying financial statements of the Canadian Seed Growers' Association,which comprise the statement of financial position as at April 30, 2016, the statements of operations,changes in net assets and cash flows for the year then ended, and notes, comprising a summary ofsignificant accounting policies and other explanatory information.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements inaccordance with Canadian accounting standards for not-for-profit organizations, and for such internalcontrol as management determines is necessary to enable the preparation of financial statements thatare free from material misstatement, whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. Weconducted our audit in accordance with Canadian generally accepted auditing standards. Thosestandards require that we comply with ethical requirements and plan and perform the audit to obtainreasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements. The procedures selected depend on our judgment, including theassessment of the risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, we consider internal control relevant to the entity’spreparation and fair presentation of the financial statements in order to design audit procedures thatare appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness ofaccounting policies used and the reasonableness of accounting estimates made by management, aswell as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basisfor our audit opinion.

KPMG LLP is a Canadian limited liability partnership and a member firm of the KPMG network of independent

member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.

KPMG Canada provides services to KPMG LLP.

Opinion

In our opinion, the financial statements present fairly, in all material respects, the financial position ofthe Canadian Seed Growers' Association as at April 30, 2016, and its results of operations, changesin net assets and cash flows for the year then ended in accordance with Canadian accountingstandards for not-for-profit organizations.

Chartered Professional Accountants, Licensed Public Accountants

July 7, 2016

Ottawa, Canada

CANADIAN SEED GROWERS' ASSOCIATIONFinancial Statements


Financial Statements

Statement of Financial Position 1

Statement of Operations 2

Statement of Changes in Net Assets 3

Statement of Cash Flows 4

Notes to Financial Statements 5

Schedule of General and Administrative Expenses 14

CANADIAN SEED GROWERS' ASSOCIATIONStatement of Financial Position

April 30, 2016, with comparative information for 2015

2016 2015

AssetsCurrent assets: Cash $ 417,175 $ 454,584 Amounts receivable 143,900 294,270 Prepaid expenses 106,391 154,883

667,466 903,737

Investments (note 2) 1,898,528 1,895,014

Tangible capital and intangible assets (note 3) 547,539 593,407

$ 3,113,533 $ 3,392,158

Liabilities and Net AssetsCurrent liabilities:

Accounts payable and accrued liabilities (note 4) $ 221,860 $ 165,534Grants payable 6,200 6,200Inspection fees payable 3,737 1,809Deferred revenue 138,442 310,226

370,239 483,769

Deferred capital asset contributions (note 5) 377,023 431,806

Deferred pension liability (note 6) 284,621 19,186

Net assets (note 7):Invested in tangible capital and intangible assets 170,516 161,601Unrestricted 1,911,134 2,295,796

2,081,650 2,457,397Commitments (note 8)

$ 3,113,533 $ 3,392,158

See accompanying notes to financial statements.

On behalf of the Board:

N. Lyster, President

G. Chancey, Executive Director1

CANADIAN SEED GROWERS' ASSOCIATIONStatement of Operations

Year ended April 30, 2016, with comparative information for 2015

2016 2015

Fees (including branch and inspection fees) $ 2,633,768 $ 2,525,389

Less: Branch fees 609,440 516,913 Inspection fees 402,254 562,253

1,011,694 1,079,166

Net fees 1,622,074 1,446,223

General and administrative expenses (schedule) 2,401,033 2,053,330

Loss before the undernoted (778,959) (607,107)

Other revenue: ASCIS fees 259,737 254,916 Annual General Meeting 178,239 156,765 Amortization of deferred capital contributions 150,093 103,635 Penalty fee income 44,253 58,540 Miscellaneous 42,984 15,667 Investment income 35,955 83,406 Government grant 17,229 2,548 Sale of pedigree seed production reports 2,553 4,538

731,043 680,015

Excess (deficiency) of revenue over expenses $ (47,916) $ 72,908


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CANADIAN SEED GROWERS' ASSOCIATIONStatement of Changes in Net Assets


Invested intangible capitaland intangible

assets Unrestricted 2016 2015

Balance, as reported $ 161,601 $ 2,295,796 $ 2,457,397 $ 2,266,886

Adjustment for the adoption ofSection 3463 - - - (141,137)

As restated 161,601 2,295,796 2,457,397 2,125,749

Excess (deficiency) of revenueover expenses - (47,916) (47,916) 72,908

Remeasurements related topension liability - (327,831) (327,831) 258,740

Purchase of tangible capital andintangible assets 200,588 (200,588) - -

Amortization of tangible capitaland intangible assets (246,456) 246,456 - -

Deferred capital contributionsreceived (95,310) 95,310 - -

Amortization of deferred capitalcontributions 150,093 (150,093) - -

Balance, end of year $ 170,516 $ 1,911,134 $ 2,081,650 $ 2,457,397


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CANADIAN SEED GROWERS' ASSOCIATIONStatement of Cash Flows


2016 2015

Cash provided by (used in):

Operating activities:Excess (deficiency) of revenue over expenses $ (47,916) $ 72,908Items not involving cash:

Amortization of tangible capital and intangible assets 246,456 204,404Amortization of deferred capital asset contributions (150,093) (103,635)Increase (decrease) in deferred pension liability 265,435 (46,601)

Change in non-cash operating working capital 85,332 260,425399,214 387,501

Investing activities:Net change in investments (3,514) (84,910)

Financing activities:Purchase of tangible capital and intangible assets (200,588) (241,378)Deferred capital asset contributions received 95,310 229,878Remeasurement related to pension liability (327,831) -

(433,109) (11,500)

Increase (decrease) in cash (37,409) 291,091

Cash, beginning of year 454,584 163,493

Cash, end of year $ 417,175 $ 454,584


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CANADIAN SEED GROWERS' ASSOCIATIONNotes to Financial Statements


The Canadian Seed Growers' Association (the "Association") provides seed pedigreeing servicesof field crops, in conjunction with the Canadian Food Inspection Agency, to over 4,000 seedgrowers across Canada.

The Association was incorporated as a corporation without share capital under Part II of theCanada Corporations Act. Effective July 30, 2013, the Association continued their articles ofincorporation from the Canada Corporations Act to the Canada Not-for-profit Corporations Act.

The Association is a not-for-profit organization under paragraph 149(1)(l) of the Income Tax Act(Canada) and, as such, is not subject to income taxes.

1. Significant accounting policies:

These financial statements have been prepared by management in accordance with Canadianaccounting standards for not-for-profit organizations in Part III of the CPA Canada Handbook –Accounting and include the following significant accounting policies:

(a) Basis of accounting:

The Association follows the deferral method of accounting for contributions for not-for-profitorganizations.

(b) Revenue recognition:

Revenue from fees and sales of production reports are recognized when the services areprovided or the goods are sold. Contributions received for the purchase of tangible capitaland intangible assets are deferred and amortized into revenue at a rate corresponding to theamortization rate of the capital asset purchased.

(c) Financial instruments:

Financial instruments are recorded at fair value on initial recognition. Investments aresubsequently measured at fair value. All other financial instruments are subsequentlyrecorded at cost or amortized cost, unless management has elected to carry the instrumentsat fair value. The Association has elected to carry any such financial instruments at fairvalue.

Transaction costs incurred on the acquisition of financial instruments measuredsubsequently at fair value are expensed as incurred. All other financial instruments areadjusted by transaction costs incurred on acquisition and financing costs, which areamortized using the effective interest rate method.

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CANADIAN SEED GROWERS' ASSOCIATIONNotes to Financial Statements (continued)


1. Significant accounting policies (continued):

(c) Financial instruments (continued):

Financial assets are assessed for impairment on an annual basis at the end of the fiscalyear if there are indicators of impairment. If there is an indicator of impairment, theAssociation determines if there is a significant adverse change in the expected amount ortiming of future cash flows from the financial asset. If there is a significant adverse changein the expected cash flows, the carrying value of the financial asset is reduced to the highestof the present value of the expected cash flows, the amount that could be realized fromselling the financial asset or the amount the Association expects to realize by exercising itsright to any collateral. If events and circumstances reverse in a future period, an impairmentloss will be reversed to the extent of the improvement, not exceeding the initial carryingvalue.

(d) Tangible capital and intangible assets:

Purchased tangible capital and intangible assets are recorded at cost. Repairs andmaintenance costs are charged to expense. When a tangible capital or intangible asset nolonger contributes to the Association's ability to provide services, its carrying amount iswritten down to its residual value.

Amortization is provided on a straight-line basis using a rate of 10% per annum for furnitureand 25% per annum for computer equipment and intangible assets.

(e) Pension costs and obligations:

The Association has a defined benefit pension plan covering some of its employees. Thebenefits are based on years of service and the employee’s compensation during the bestthree years of employment.

The Association also has a defined contribution plan providing pension benefits to itsemployees. The cost of the defined contribution plan is recognized based on thecontributions required to be made during each period.

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1. Significant accounting policies (continued):

(e) Pension costs and obligations (continued):

The Association uses the immediate recognition approach to account for the above plan.The Association accrues its obligations under the defined benefit plan as the employeesrender the services necessary to earn the pension benefits. The actuarial determination ofthe accrued benefit obligations for pensions uses the projected benefit method prorated onservice (which incorporates management's assumptions used for funding purposes, othercost escalation, retirement ages of employees and other actuarial factors). Themeasurement date of the plan assets, which are recorded at fair value, and accrued benefitobligation coincides with the Association’s fiscal year.

In years between valuations, the Association uses a roll-forward technique to estimate theaccrued benefit obligation. The Association recognizes the accrued benefit obligation net ofthe fair value of the plan amounts adjusted for any valuation allowance in the statement offinancial position at the end of the year.

The annual benefit cost is recorded in the statement of operations and the actuarial gainsand losses are recognized in the statement of deferred contributions.

The pension fund is funded in accordance with legal requirements and standard actuarialpractice. Assets of the pension plan are used to purchase life annuities for employees onretirement when benefits under the plan are increased. Additional annuities are purchasedfor retired employees.

(f) Foreign exchange:

Transactions conducted in a foreign currency are translated into Canadian dollars at theaverage exchange rate for the period. Assets and liabilities denominated in foreigncurrencies are translated at exchange rates in effect at year-end. Foreign exchange gainsand losses are included in income.

(g) Use of estimates:

The preparation of financial statements requires management to make estimates andassumptions that affect the reported amounts of assets and liabilities and disclosure ofcontingent assets and liabilities at the date of the financial statements and the reportedamounts of revenue and expenses during the period. Actual results could differ from theseestimates. These estimates are reviewed annually and as adjustments become necessary,they are recognized in the financial statements in the period in which they become known.

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2. Investments:

Investments are composed of the following securities:

2016 2015

Short-term investments $ 785,519 $ 485,198Long-term investments:

Government fixed income 210,682 410,652Corporate fixed income 693,374 788,617Equities 139,000 209,048Equity funds 64,901 -

Accrued interest on investments 5,052 1,499

Total investments $ 1,898,528 $ 1,895,014

3. Tangible capital and intangible assets:

2016 2015 Accumulated Net book Net book

Cost amortization value value

Tangible capital assets:Furniture and equipment $ 56,126 $ 34,386 $ 21,740 $ 15,541Leasehold improvements 89,911 8,084 81,827 514Computers 195,974 145,453 50,521 85,562

342,011 187,923 154,088 101,617

Intangible assets 1,031,278 637,827 393,451 491,790

$ 1,373,289 $ 825,750 $ 547,539 $ 593,407

At April 30, 2015, cost and accumulated amortization amounted to $1,182,280 and $588,873,respectively.

4. Accounts payable and accrued liabilities:

At year end, there were no amounts payable related to government remittances or payroll-relatedtaxes (2015 - $Nil).

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5. Deferred capital asset contributions:

2016 2015

Balance, beginning of year $ 431,806 $ 305,563

Add: Additions to tangible capital and intangible assets 95,310 229,878

Less: Amortization (150,093) (103,635)

Balance, end of year $ 377,023 $ 431,806

6. Deferred pension liability:

The Association administers the Pension Plan for the Employees of the Canadian Seed Growers’Association, which is a defined benefit and defined contribution plan registered with the FinancialServices Commission of Ontario, and covers most of the Association’s employees.

The latest actuarial valuation was performed as at July 31, 2015. The latest extrapolation usingcurrent assumptions was performed at April 30, 2016. The next actuarial valuation for fundingpurposes is required to be completed as at July 31, 2018, or earlier, in accordance with therequirements of the Pension Benefits Act (Ontario).

As part of the regulations governing provincially regulated pension plans, pension plans mustmeet certain solvency requirements which assume the plans are wound up/liquidated as of thevaluation date. The actuarial valuation for funding purposes performed as at July 31, 2015reported a solvency surplus of $51,973 and a going-concern deficiency of $354,040, based oneconomic assumptions applicable at July 31, 2015.

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6. Deferred pension liability (continued):

The reconciliation of the funded status of the defined benefit pension plan to the amount recordedin the financial statements is as follows:

2016 2015

Fair value of plan assets $ 4,192,638 $ 4,387,931Accrued benefit obligation (4,477,259) (4,407,117)

$ (284,621) $ (19,186)

(a) Plan assets:

2016 2015

Plan assets at fair value, beginning of year $ 4,387,931 $ 3,998,680Actual return on plan assets (48,319) 472,087Employer contributions 122,574 131,707Employee contributions 21,740 24,731Benefits paid (291,288) (239,274)

Plan assets at fair value, end of year $ 4,192,638 $ 4,387,931

The defined benefit pension expense for the year was $60,178 (2015 - $85,106) and isincluded in employee benefit expense shown in the schedule of general administrationexpenses.

(b) Accrued benefit obligation:

2016 2015

Accrued benefit obligation, beginning of year $ 4,407,117 $ 4,323,207Benefits accrued 80,863 91,988Benefits paid (291,288) (239,274)Interest 242,391 231,196Actuarial loss 38,176 -

Accrued benefit obligation, end of year $ 4,477,259 $ 4,407,117

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6. Deferred pension liability (continued):

(c) Pension plan assets:

Plan assets are invested in the following securities at April 30:

2016 2015

Cash and cash equivalents 6% 10%Bonds and GICs 33% 27%Canadian equities 27% 39%Foreign equities 34% 34%

(d) Assumptions:

The significant assumptions used in accounting for the defined pension benefit plan atApril 30 are as follows:

Pension benefit plan2016 2015

Accrued benefit obligation as of April 30:Discount rate 5.50% 5.50%Rate of compensation increase 3.25% 3.75%

Benefit costs for year ended April 30:Discount rate 5.50% 5.50%Expected return on plan assets 5.50% 5.50%Rate of compensation increase 3.25% 3.75%

7. Net assets:

The Association considers its capital to consist of its net assets. The Association’s overallobjective with its capital is to fund tangible capital and intangible assets, research and ongoingoperations.

The Association is not subject to externally imposed capital requirements and its overall strategywith respect to capital remains unchanged from the year ended April 30, 2015.

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8. Commitments:

The Association rents office space and equipment under operating leases which expire fromOctober 31, 2017 to May 31, 2020. The minimum annual lease payments for the next five yearsare as follows:

2017 $ 97,3712018 93,2912019 93,2912020 90,4542021 7,065

$ 381,472

9. Financial risks and concentration of credit risk:

(a) Currency risk:

The Association is exposed to financial risks as a result of exchange rate fluctuations andthe volatility of these rates. In the normal course of business, the Association purchasesinvestments denominated in U.S. dollars. The Association does not currently enter intoforward contracts to mitigate this risk.

(b) Liquidity risk:

Liquidity risk is the risk that the Association will be unable to fulfill its obligations on a timelybasis or at a reasonable cost. The Association manages its liquidity risk by monitoring itsoperating requirements. The Association prepares budget and cash forecasts to ensure ithas sufficient funds to fulfill its obligations.

(c) Credit risk:

Credit risk refers to the risk that a counterparty may default on its contractual obligationsresulting in a financial loss. The Association is exposed to credit risk with respect to theaccounts receivable. The Association assesses, on a continuous basis, accounts receivableand provides for any amounts that are not collectible in the allowance for doubtful accounts.

(d) Interest rate risk:

The Association is exposed to interest rate risk on its fixed interest rate financial instruments.Further details about the fixed rate investments are included in note 2.

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9. Financial risks and concentration of credit risk (continued):

(e) The Association believes that it is not exposed to significant foreign currency risk arisingfrom its financial instruments.

There have been no changes to the risk exposures from 2015.

10. Comparative information:

Certain 2015 comparative information has been reclassified to conform with the financialstatement presentation adopted for the current year.

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CANADIAN SEED GROWERS' ASSOCIATIONSchedule of General and Administrative Expenses


2016 2015

Salaries $ 881,573 $ 751,472Employee benefits 187,372 168,135Amortization of tangible capital and intangible assets 246,456 204,404Travel, directors 240,608 169,947Annual general meeting 165,154 135,536Professional fees 96,523 29,891Rent 92,786 98,251Publicity 91,129 79,087Data processing 79,439 74,034Travel, staff 73,376 69,668Technical and data development 67,279 36,824Honoraria 42,000 42,000Rental of equipment 19,905 21,318Insurance 19,291 19,176Office supplies and stationery 16,282 11,585Special projects 16,102 58,052Membership fees 15,196 12,681Internet and web site service 14,309 13,101Postal services 13,497 17,114Telephone 11,028 7,430Bad debts 3,203 636Presentations and sponsorships 3,000 3,049Printing 2,778 1,569Promotional material 2,311 2,598Subscriptions 436 420Research grants - 25,000ACAAF-related projects - 352

$ 2,401,033 $ 2,053,330

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canadian seed growers’ association 2015-16 annual report · 2019-11-10 · csga 2015-16 annual...

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