independent auditor'sreport to ... - ghost lake,...

INDEPENDENT AUDITOR'S REPORT

TO THE MEMBERS OF COUNCIL

SUMMER VILLAGE OF GHOST LAKE

Report on the Consolidated Financial Statements

We have audited tlie accompanying consolidated financial statements of tlie Summer Village ofGhost Lake, which comprise of tlie consolidated statement of financial position as at December31, 2015, and the consolidated statements of operations, change in net financial assets (debt),and cash flows for the year then ended, and a summary of significant accounting policies andother explanatory information.

Management's Responsibility for tlie Consolidated Financial Statements

Management is responsible for tlie preparation and fair presentation of these consolidatedfinancial statements in accordance with Canadian public sector accounting standards, and forsuch internal control as management determines is necessary to enable the preparation ofconsolidated financial statements that are free from material misstatement, whether due tofraud or error.

Auditor's Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based onour audit. We conducted our audit in accordance with Canadian generally accepted auditingstandards. Those standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whether the consolidated financialstatements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts anddisclosures in the consolidated financial statements. The procedures selected depend on theauditor's judgment, including the assessment of tlie risks of material misstatement of theconsolidated financial statements, whether due to fraud or error. In making those risk

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assessments, the auditor considers internal control relevant to the entity's preparation and fairpresentation of the consolidated 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 theappropriateness of accounting policies used and the reasonableness of accounting estimatesmade by management, as well as evaluating the overall presentation of the consolidatedfinancial statements.

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

Opinion

In our opinion, the consolidated financial statements present fairly, in all material respects, thefinancial position of the Summer Village of Ghost Lake as at December 31,2015, the results of itsoperations, change in its net financial assets (debt), and its cash flows for the year then ended inaccordance with Canadian public sector accounting standards.

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January 26,2016Calgary, Alberta Professional Accountants

Summer Village of Ghost Lake

Consolidated Statement of Financial Position

As at December 31,2015

FINANCIAL ASSETS

Cash and temporary investments (Note 2)Receivables

Taxes and grants in lieu receivables (Note 3)Trade and other receivables

LIABILITIES

Accounts payable and accrued liabilitiesDeferred revenue (Note 4)

NET FINANCIAL ASSETS (DEBT)

NON-FINANCIAL ASSETS

Tangible capital assets (Note 5, Schedule 2)Prepaid expenses

ACCUMULATED SURPLUS (Note 9)

Approved and Adopted by Councilor XksW *A0+-*y W{A.V \o

Mayor

2015

$

2014

$

343,340 294,994

8,477

351,816

677

10,687306,358

20,248

37,385

57,633

28,367

6,000

34,367

294,183 271,991

697,048

1,095

698,143

734,735

125

734,860

992,325 1,006,851

The accompanying notes form an integral part of these financial statements


Consolidated Statement of OperationsFor the Year Ended December 31,2015

REVENUE

Net municipal taxes (Schedule 3)User fees and sales ofgoodsGovernment transfers for operating (Schedule 4)Penalties and costs on taxes

Investment income

Other

Total Revenue

EXPENSES

LegislativeAdministrative

Fire

Common services

Roads, streets, walks, lightingStorm systemWater supply and distributionWaste managementLand use planning, zoning, developmentRecreation and parksCulture

Total Expenses

(SHORTFALL) EXCESS OF REVENUE OVER EXPENSES - BEFORE OTHER

OTHER

Government transfers for capital (Schedule 4)

(SHORTFALL) EXCESS OF REVENUE OVER EXPENSES

ACCUMULATED SURPLUS, BEGINNING OF YEAR

ACCUMULATED SURPLUS, END OF YEAR

Budget 2015 2014

$ $ $(Unaudited)

82,681 82,463 79,183- 7,706 6,384

13,285 26,633 7,085- 375 1,119

300 1,911 2,242- 5,419 3,150

96,266 124,506 99,163

600 721 1,24445,039 43,245 41,348

22,569 22,592 22,6951,354 1,337 1,354

16,358 15,894 18,63514,347 9,491 97

57 57 57

12,050 10,768 11,911500 17,882 -

15,359 16,143 18,109829 902 814

129,062 139,032 116,263

(32,796) (14,526) (17,100)

40,000 - -

7,204 (14,526) (17,100)

810,652 1,006,851 1,023,951

817,856 992,325 1,006,851



Consolidated Statement of Change in Net Financial Assets (Debt)For the Year Ending December 31,2015

EXCESS (SHORTFALL) OF REVENUES OVER EXPENSES

Contributed capital assetsAmortization of tangible capital assets

Acquisition of prepaid assetsUse of prepaid assets

INCREASE (DECREASE) IN NET DEBT

NET FINANCIAL ASSETS (DEBT), BEGINNING OF YEAR

NET FINANCIAL ASSETS (DEBT), END OF YEAR

Budget$

(Unaudited)

2015

$

2014

$

7,204 (14,526) (17,100)

(40,000)37,687 37,988

(40,000) 37,687 37,988

- (1,095)125 970

- (970) 970

(32,796)

271,993

22,192

271,991

21,858

250,133

239,197 294,183 271,991



Consolidated Statement of Cash Flows

For the Year Ended December 31,2015

NET INFLOW (OUTFLOW) OF CASH RELATED TOTHE FOLLOWING ACTIVITIES:

OPERATING

Shortfall of revenues over expensesNon-cash items included in excess (shortfall) of

revenues over expenses:

Amortization of tangible capital assetsTangible capital assets received as contributions

Non-cash charges to operations (net change):Decrease (increase) in taxes and grants in lieu receivablesDecrease (increase) in trade and other receivablesDecrease (increase) in prepaid expensesIncrease (decrease) in accounts payable and accrued liabilitiesIncrease (decrease) in deferred revenue

Cash provided by operating transactions

CAPITAL

Acquisition of tangible capital assetsSale of tangible capital assets

Cash applied to capital transactions

CHANGE IN CASH AND EQUIVALENTS DURING THE YEAR

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

CASH AND CASH EQUIVALENTS, END OF YEAR

Cash and cash equivalents is made up of:Cash and temporary investmentsLess: restricted portion of cash and temp investments (Note 2)

2015 2014

$ $

(14,526) (17,100)

37,687 37,988

678 676

2,210 49,573(970) 970

(8,119) (2,635)31,385 2,23748,346 71,708

- -

48,346

294,994

71,708

223,286

343,340 294,994

343,340

(290,655)52,684

294,994

(241,744)53,250


TAXATION


Schedule of Property and Other TaxesFor the Year Ended December 31,2015

Schedule 3

Real property taxesLinear property taxes(Over) under levy adjustment

REQUISITIONSCalgary RCSSD #1 Separate School BoardAlberta School Foundation Fund

NET MUNICIPAL TAXES

Budget$

(Unaudited)

2015

$

2014

$

197,987322

197,768322

200,935317

198,309 198,090 201,252

17,015

98,613

17,015

98,613

18,034

104,035

115,628 115,628 122,069

82,681 82,463 79,183

TRANSFERS FOR OPERATING:

Provincial Government

Other Local Governments

TRANSFERS FOR CAPITAL:

Federal Government

Provincial Government


Schedule of Government Transfers

For the Year Ended December 31,2015Schedule 4

Budget$

(Unaudited)

2015

$

2014

13,285 26,633 7,085

13,285 26,633 7,085

40,000

40,000 - -

53,285 26,633 7,085


Schedule of Consolidated Expenditures by ObjectFor the Year Ended December 31,2015

Schedule 5

CONSOLIDATED EXPENSES BY OBJECT

Salaries, wages, and benefitsContracted and general servicesPurchases from other governmentsMaterials, goods, supplies, and utilitiesAmortization of tangible capital assetsBank chargesOther expenditures

Budget 2015 2014

$ $ $(Unaudited)

3,237 2,521 2,509

79,578 91,759 66,5172,200 1,764 1,6506,100 4,522 6,797

38,121 37,688 37,988- 50 51

779 728 752

130,015 139,032 116,264

10

COST:

BALANCE, BEGINNING OF YEAR

Acquisition of tangible capital assetsConstruction - in - progressDisposal of tangible capital assetsWrite down of tangible capital assets

BALANCE, END OF YEAR

ACCUMULATED AMORTIZATION:


Annual amortization

Accumulated amortization on disposals


NET BOOK VALUE OF

TANGIBLE CAPITAL ASSETS

2014 NET BOOK VALUE OF


LAND

SUMMER VILLAGE OF GHOST LAKESchedule ofTangible Capital Assets

For the Year Ended December 31,2015Schedule 2

ENGINEERED STRUCTURES MACHINERY

LAND IMPROVEMENT BUILDINGS ROADS/STREETS WATER SYSTEM STORM SYSTEM and EQUIPMENT VEHICLES2015

$

2014

$

36,970 130,766 423,348 337,285

0 0

36,970 130,766 423,348 337,285

80,098 47,789 86,551

4,189 16,706 14,358

84,287 64,496 100,910

36,970 46,478 358,852 236,375

36,970 50,667 375,558 250,733

4,298

4,298

1,394

57

1,451

2,847

2,904

7,284 31,287 17,522

0 0

988,758 988,758

0 0

0 0

0 0

0 0

7,284

2,865

97

31,287 17,522 988,758 988,758

21,157 14,168 254,023 216,035

1,248 1,032 37,688 37,9880 0

2,962 22,404 15,200 291,710 254,023

4,322 *,882 2,322 697,048 734,735

4,419 10,130 3,354 734,735 772,723


Schedule of Changes in Accumulated SurplusFor the Year Ended December 31,2015

Schedule 1

Unrestricted Restricted Equity in TangibleSurplus Surplus Capital Assets


Excess (deficiency) of revenues over expensesUnrestricted funds designated for future useCurrent year funds used for tangible capital assetsAnnual amortization expense

Change in accumulated surplus


o>

51,958

(14,526)(23,161)

220,158

23,161

734,735

37,687 - (37,687)

(0) 23,161 (37,687)

51,958 243,319 697,048

2015

$

2014

$

1,006,851

(14,526)

1,023,951

(17,100)

(14,526) (17,100)

992,325 1,006,851

REVENUE

Net municipal taxesGovernment transfers

User fees and sales ofgoodsInvestment income

Other revenues

EXPENSES

Contract & general servicesPurchases from other governmentsSalaries & wagesGoods & suppliesTransfers to local boards

Other expenses

NET REVENUE, BEFOREAMORTIZATION

Amortization expense

NET REVENUE


Schedule of Segmented DisclosureFor the Year Ended December 31, 2015

Schedule 6

General Protective Transportation Planning & Recreation Environmental OtherGovernment Services Services Development & Culture Services

82,46326,633

180 7,5261,9115,794

116,980 7,526

,080 2,770 750 17,882 18,274 9,0031,764

465 2,056286 2,363 785 1,088

728

50

43,880 5,133 1,535 17,882 22,146 10,768 0

73,100 (5,133) (1,535) (17,882) (14,620) (10,768) 0

(86) (17,459) (15,695) (4,293) (154)

73,014 (22,592) (17,230) (17,882) (18,913) (10,922) 0

Total

$

82,46326,633

7,7061,9115,794

124,506

91,7591,7642,5214,522

728

50

101,344

23,162

(37,688)

(14,526)

Summer Village of Ghost LakeNotes to Financial Statements

For the Year ended December 31,2015

SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements for the Summer Village of Ghost Lake arethe representations of management prepared in accordance with generallyaccepted accounting principles for local governments established by the PublicSector Accounting and Auditing Board of the Canadian Institute of CharteredAccountants. Significant aspects of the accounting policies adopted by theSummer Village of Ghost Lake are as follows:

a) Reporting Entity

The consolidated financial statements reflect the assets, liabilities,revenues and expenditures and changes in the fund balances and infinancial position of the reporting entity which comprises all theorganizations that are accountable for the administration of their financialaffairs and resources to the Council and are owned or controlled by themunicipality.

The schedule of taxes levied also includes requisitions for education thatare not part of the municipal reporting entity.

The statements exclude trust assets that are administered for the benefit of

external parties. Interdepartmental and organizational transactions andbalances are eliminated.

b) Basis of Accounting

The financial statements are prepared using the accrual basis ofaccounting. The accrual basis of accounting records revenue as it isearned and measurable. Expenses are recognized as they are incurred andmeasurable based upon receipt of goods or services and/or the legalobligation to pay.

Funds from external parties and earnings thereon restricted by agreementor legislation are accounted for as deferred revenue until used for thepurpose specified.

Government transfers, contributions and other amounts are received fromthird parties pursuant to legislation, regulation or agreement and may onlybe used for certain programs, in the completion of specific work, or for thepurchase of tangible capital assets. In addition, certain user charges andfees are collected for which the related services have yet to be performed.

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Revenue is recognized in the period when the related expenses areincurred, services performed orthe tangible capital assets are acquired.

c) Use of Estimates

The preparation of financial statements in conformity with Canadiangenerally accepted accounting principles requires management to makeestimates and assumptions that affect the reported amount of assets andliabilities and disclosure of contingent assets and liabilities at the date ofthe financial statements, and the reported amounts of revenue andexpenditure during the period. Where measurement uncertainty exists, thefinancial statements have been prepared within reasonable limits ofmateriality. Actual results could differ from those estimates.

d) Requisition Over-levy and Under-levy

Over levies and under-levies arise from the difference between the actual

property tax levy made to cover each requisition and the actual amountrequisitioned.

If the actual levy exceeds the requisition, the over-levy is accrued as aliability and property tax revenue is reduced. Where the actual levy is lessthan the requisition amount, the under-levy is accrued as a receivable andas property tax revenue.

Requisition tax rates in the subsequent year are adjusted for any over-levies or under-levies of the prior year.

e) Government Transfers

Government transfers are the transfer of assets from senior levels of

government that are not the result of an exchange transaction, are notexpected to be repaid in the future, or the result of a direct financial return.

Government transfers are recognized in the financial statements arerevenues in the period in the period in which events giving rise to thetransfer occur, providing the transfers are authorized, any eligibilitycriteria have been met, and reasonable estimates of the amounts can bedetermined.

13



f) Investments

Investments are recorded at amortized cost. Investment premiums anddiscounts are amortized on the net present value basis over the term of therespective investments. When there has been a loss in value that is otherthan a temporary decline, the respective investment is written down torecognize the loss.

g) Tax Revenue

Tax revenues are recognized when the tax has been authorized by bylawand the taxable event has occurred.

School requisitions operate as a flow through and are excluded frommunicipal revenue.

h) Non-Financial Assets

Non-financial assets are not available to discharge existing liabilities andare held for use in the provision of services. They have useful livesextending beyond the current year and are not intended for sale in thenormal course of operations. The change in non-financial assets duringthe year, together with the excess of revenues over expenses, provides theconsolidated Change in Net Financial Assets (Debt) for the year.

i. Tangible Capital Assets

Tangible capital assets are recorded at cost which includes all amountsthat are directly attributable to acquisition, construction, development orbetterment of the asset. The cost, less residual value, of the tangiblecapital assets is amortized on a straight-line basis over the estimated usefullife as follows:

Type of Asset Maximum Useful Life

Land Improvements 15-25Buildings 25-50Engineered Structures 5-45Equipment 5-30Vehicles 10-25

Assets under construction are not amortized until the asset is available forproductive use.

14

2.



ii) Contributions of Tangible Capital Assets

Tangible capital assets received as contributions are recorded at fair valueat the date of receipt and also are recorded as revenue.

iii) Leases

Leases are classified as capital or operating leases. Leases which transfersubstantially all of the benefits and risks incidental to ownership ofproperty are accounted for as capital leases. All other leases are accountedfor as operating leases and the related lease payments are charged toexpenses.

iv) Cultural and Historical Tangible Capital Assets

Works of art for display are not recorded as tangible capital assets but aredisclosed.

CASH AND TEMPORARY INVESTMENTS

2015

$

2014

$

Cash

Temporary Investments

Total Cash and Temporary Investments

18,340

325,000

343,340

14,994

280,000

294,994

Guaranteed Investment Certificates have an effective interest rate of .70% and mature in

less than one year.

Restricted Cash

2015

$

2014

$

Restricted surplusDeferred revenue

Development agreement deposits

Total Cash and Temporary Investments

243,320

37,385

9,950

290,655

14,994

280,000

15,585

241,744

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TAXES AND GRANTS IN PLACE OF TAXES RECEIVABLES

Current:

Current taxes and grants in lieuLess: allowances for doubtful accounts

Non-current:

Tax arrears and grants in lieu

4. DEFERRED REVENUE

Municipal Sustainability - OperatingMunicipal Sustainability -CapitalBasic Municipal Transportation GrantNew Deal for Cities and Communities

ACP - Collaboration Grant

Prepaid Taxes

2015

2015

2014

$

2014

677

677

677

4,207

134

5,380

- 115

30,749

1,122 1,678

37,385 6,000

16

5.




Net Book Value

Land

Land ImprovementsBuildingsRoads

Water system

Storm system

Machinery, equipment & furnishingsVehicles

2015 2014

Cost Cost

$ $

36,970 36,970

46,478 50,667

358,852 375,558

236,375 250,733

2,847 2,904

4,322 4,419

8,882 10,130

2,321 3,354

697,047 734,735

6. SALARY AND BENEFITS DISCLOSURE

Disclosure of salaries and benefits for municipal officials, the chief administrativeofficer and designated officers as required by Alberta Regulation 313/2000 is asfollows:

2015 2014

Contract/ Benefits & Total Total

Remuneration Allowances

Councillor Brian Oblak 100 100 100

Councillor Noel Betts 100 100 100

Councillor Warren Wilson 100 100 100

Chief Administrative Officer 28,140 901 29,041 27,076

1. Contract includes regular pay, general office expenses and equipmentrental

2. Benefits and allowances include mileage reimbursement

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7. DEBT LIMITS

Total Debt Limit

Total Debt

Amount total debt limit exceeded

Service on debt limit

Service on debt

Amount service on debt limited exceeded

2015

$

186,760

0

2014

$

148,746

0

186,760 148,746

31,127

0

24,791

0

31,127 24,971

Section 276(2) of the Municipal Government Act requires that debt and debtlimits as defined by Alberta Regulation 255/00 for the Summer Village of GhostLake be disclosed as follows:

The debt limit is calculated at 1.5 times revenue of the municipality (as defined inAlberta Regulation 255/2000 and the debt service limit is calculated at 0.25 timessuch revenue. Incurring debt beyond these limitations requires approval by theMinister of Municipal Affairs. These thresholds are guidelines used by AlbertaMunicipal Affairs to identify municipalities, which could be at financial risk iffurther debt is acquired. The calculation taken alone does not represent thefinancial stability of the municipality. Rather, the financial statements must beinterpreted as a whole.

8. EQUITY IN TANGIBLE CAPITAL ASSETS

Tangible capital assets (Schedule 1)Accumulated amortization (Schedule 1)

2015

$

2014

$

988,758

(291,710)

988,758

(254,023)

697,048 734,735

18



9. ACCUMULATED SURPLUS

Unrestricted surplus (deficit)Restricted surplus

RESERVES - ALET

RESERVES - AMBULANCE

RESERVES - CAPITAL PUBLIC WORKS

RESERVES - CONTINGENCY

RESERVES - REC & PARKS

RESERVES - REC BOARD

RESERVES - MR 32,000 32,000

RESERVES - FIRE

RESERVES - REC GOODS

RESERVES - PLANNING COMMITTEE

RESERVES-BYLAW

RESERVES - ROAD OPR

RESERVES - LIBRARY

RESERVES MSI INTEREST

RESERVES SHORELINE

Equity in tangible capital assets

2015

$

51,958

2014

$

51,958

5,825

652

5,825

652

140,751

24,823

4,281

6,605

126,671

20,087

4,281

4,660

21,637 21,637

500 500

850 850

5,000 -

221 221

140 140

34 34

- 2,600

697,048 734,735

992,325 1,006,851

10. SEGMENTED DISCLOSURE

The Summer Village of Ghost Lake provides a range of services to its ratepayers.For each reported segment, revenues and expenses represent both amounts thatare directly attributable to the segment and amounts that are allocated on areasonable basis. The accounting policies used in these segments are consistentwith those followed in the preparation of the financial statements as disclosed inNote 1.

19



11. CONTINGENCIES

The Summer Village of Ghost Lake is a member of the Alberta MunicipalInsurance Exchange (MUNIX). Under the terms of the membership, the SummerVillage of Ghost Lake could become liable for its proportionate share of anyclaim losses in excess of the funds held by the exchange. Any liability incurredwould be accounted for as a current transaction in the year the losses aredetermined.

12. FINANCIAL INSTRUMENTS

The Summer Village's financial instruments consist of cash and temporaryinvestments, receivables, accounts payable, deposit liabilities and accruedliabilities. It is management's opinion that the Summer Village is not exposed tosignificant interest, or currency risk arising from these financial statements.

The Summer Village is subject to credit risk with respect to taxes and otherreceivables. Credit risk arises from the possibility that taxpayers and entities towhich the Summer Village provides services may experience financial difficultand be unable to fulfill their obligations. The large number and diversity oftaxpayers and customers minimize the credit risk.

Unless otherwise noted, the fair value of these financial instruments approximatesfair value.

13. APPROVAL OF FINANCIAL STATEMENTS

Council and Management have approved these financial statements.

14. COMPARATIVE FIGURES AND ROUNDING

Certain of the comparative figures have been restated to facilitate comparison tothe current year's presentation. Rounding due to the use of formulas has alsocaused some totals to differ due to rounding.

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