The URL can be used to link to this page

Home My WebLink About2010-12-31 Year End Audited Financial Satements0 Consolidated Financial Statements of Year ended December 31, 2010 Management's Responsibility for the Consolidated Financial Statements The accompanying consolidated financial statements of County of Newell No. 4 (the "County") are the responsibility of the County's management and have been prepared in compliance with legislation, and in accordance with generally accepted accounting principles for local governments established by the Public Sector Accounting Board of The Canadian Institute of Chartered Accountants. A summary of the significant accounting policies are described in Note 1 to the consolidated financial statements. The preparation of financial statements necessarily involves the use of estimates based on management's judgment, particularly when transactions affecting the current accounting period cannot be finalized with certainty until future periods. The County's management maintains a system of internal controls designed to provide reasonable assurance that assets are safeguarded, transactions are properly authorized and recorded in compliance with legislative and regulatory requirements, and reliable financial information is available on a timely basis for preparation of the consolidated financial statements. These systems are monitored and evaluated by management. Council meets with management and the external auditors to review the consolidated financial statements and discuss any significant financial reporting or internal control matters prior to their approval of the consolidated financial statements. The consolidated financial statements have been audited by KPMG LLP, independent external auditors appointed by the County. The accompanying Auditors' Report outlines their responsibilities, the scope of their examination and their opinion on the County's consolidated financial statements. Kevin Stephenson Chief Administrative Officer KPMG LLP Telephone (403) 380-5700 Chartered Accountants Fax (403) 380-5760 500 Lethbridge Centre Tower Internet www.kpmg.ca 400 - 4th Avenue South Lethbridge AB TU 4E1 Canada Independent Auditors' Report To the Reeve and Members of Council of the County of Newell No. 4 We have audited the accompanying financial statements of County of Newell No. 4 (the "County") which comprise the statement of financial position as at December 31, 2010, and the statements of financial activities, changes in net financial assets, and cash flows for the year then ended, and notes, comprising a summary of significant 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 in accordance with Canadian public sector accounting standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors' Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of County of Newell No. 4 as at December 31, 2010, and the results of its financial activities and its cash flows for the year then ended in accordance with Canadian public sector accounting standards. March 24, 2011 Lethbridge, Canada 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 COUNTY OF NEWELL NO.4 Consolidated Statement of Financial Position December 31, 2010, with comparative figures for 2009 Financial liabilities: Accounts payable and accrued liabilities 2010 200 Financial assets: 242,902 260,097 Cash and temporary investments (note 2) $ 39,231,724 $ 48,943,069 Taxes and grants in place of taxes receivable (note 3) 769,911 563,831 Trade and other receivables 4,901,392 9,230,081 Land held for resale 31,881 31,881 Investments (note 4) 16,394,197 4,059,851 Notes receivable (note 5) 7,618,660 7,025,877 Other financial assets -- 13,815 68,947,765 69,868,405 Financial liabilities: Accounts payable and accrued liabilities 5,456,973 6,983,652 Employee benefit obligations (note 7) 242,902 260,097 Unearned revenue 85,178 49,963 Long-term debt - operating (note 8) 5,679,764 6,233,550 Long-term debt - capital (note 9) 425,150 504,421 Provision for landfill closure and post -closure costs (note 10) 339,507 339,849 Provision for gravel pit closure and post -closure costs (note 10) 293,701 293,701 Deposit liabilities (note 2) 166,237 180,246 Other financial liabilities 62,431 -- 12,751, 843 14, 845,479 Net financial assets 56,195,922 55,022,926 Non-financial assets: Prepaid expenses 143,785 150,464 Tangible Capital Assets (note 6) 98,447,085 73,568,974 Inventory for consumption 986,785 945,222 99,577,655 74,664,660 Contingent liabilities (note 19) Accumulated surplus (note 11) $155,773,577 $129,687,586 The accompanying notes are an integral part of these consolidated financial statements. COUNTY OF NEWELL NO.4 Consolidated Statement of Financial Activities Year ended December 31, 2010, with comparative figures for 2009 Excess of revenues over expenses before the undernoted 2,552,408 7,229,760 463,780 Other: Contributed assets 535,522 1,667,917 624,420 Government transfers (note 13) 29,568,274 17,188,314 26,771,730 Excess of revenues over expenses 32,656,204 26,085,991 27,859,930 Accumulated surplus, beginning of year 129,687,586 129,687,586 101,827,656 Accumulated surplus, end of year $162,343,790 $155,773,577 $129,687,586 The accompanying notes are an integral part of these consolidated financial statements. 2 Budget 2010 luuv (Unaudited) Revenues: Net municipal property taxes (note 12) $ 25,599,034 $ 25,357,073 $ 27,529,024 Special levies 784,728 784,728 725,363 User fees and sale of goods 396,640 798,453 800,859 Government transfers (note 13) 2,024,363 1,632,870 1,733,210 Penalties and cost of taxes 80,500 138,669 112,218 Investment income 777,657 1,180,134 1,448,226 Licenses and permits 34,400 30,700 27,125 Other revenue 46,315 114,928 161,852 Gain (loss) on disposal of tangible capital assets 2,878,217 91,464 (39,478) 32,621,854 30,129,019 32,498,399 Expenses (note 14): Legislative 479,900 438,302 419,156 Administration 2,707,857 2,046,183 1,846,899 General 3,122,567 854,291 2,350,381 Corporate safety services 266,399 238,257 216,334 Fire and by-law enforcement 1,029,446 1,032,879 953,991 Disaster and emergency services 170,929 180,571 12,314 Roads, streets, walks and lighting 9,864,793 8,628,420 10,142,187 Airport 90,675 90,641 -- Water and waste water 9,258,191 6,612,354 13,464,843 Waste management 249,414 249,413 234,308 Family and community support 43,000 43,949 41,217 Municipal planning 286,940 224,308 216,496 Community and agricultural services 1,369,333 1,140,078 1,141,585 Subdivision land and development 240,773 171,491 166,050 Recreation and parks 748,064 733,752 701,270 Culture and library 141,165 138,125 137,222 Other -- 76,245 (9,634) 30,069,446 22,899,259 32,034,619 Excess of revenues over expenses before the undernoted 2,552,408 7,229,760 463,780 Other: Contributed assets 535,522 1,667,917 624,420 Government transfers (note 13) 29,568,274 17,188,314 26,771,730 Excess of revenues over expenses 32,656,204 26,085,991 27,859,930 Accumulated surplus, beginning of year 129,687,586 129,687,586 101,827,656 Accumulated surplus, end of year $162,343,790 $155,773,577 $129,687,586 The accompanying notes are an integral part of these consolidated financial statements. 2 COUNTY OF NEWELL NO.4 Consolidated Statement of Change in Net Financial Assets December 31, 2010, with comparative figures for 2009 Budget 2010 2009 (Unaudited) Excess of revenues over expenses $32,656,204 $ 26,085,991 $ 27,859,930 Acquisition of tangible capital assets -- (27,515,552) (27,210,062) Contributed tangible capital assets (535,522) (1,667,917) (624,420) Proceeds on disposal of tangible capital assets -- 1,067,497 105,369 Amortization of tangible capital assets 4,399,605 3,329,325 2,884,769 Gain (loss) on disposal of tangible capital assets (2,878,217) (91,464) 39,478 33,642,070 1,207,880 3,055,064 Use (acquisition) of inventories of supplies — (41,563) 289,081 Use (acquisition) of prepaid expenses -- 6,679 (17,273) Change in net financial assets 33,642,070 1,172,996 3,326,872 Net financial assets, beginning of year 55,022,926 55,022,926 51,696,054 Net financial assets, end of year $88,664,996 $ 56,195,922 55,022,926 The accompanying notes are an integral part of these consolidated financial statements. COUNTY OF NEWELL NO.4 Consolidated Statement of Cash Flows Year ended December 31, 2010, with comparative figures for 2009 2010 2009 Cash provided by (used in): Operations: Excess of revenues over expenses $ 26,085,991 $ 27,859,930 Items not involving cash: Amortization 3,329,325 2,884,769 Contributed assets (1,667,917) (624,420) (Gain) loss on disposal of tangible capital assets (91,464) 39,478 Change in non-cash financial assets and liabilities: Taxes and grants in place of taxes receivable (206,080) (32,038) Trade and other receivables 4,328,689 (5,972,463) Other financial assets 13,815 (9,634) Prepaid expenses 6,679 (17,273) Inventory for consumption (41,563) 289,081 Accounts payable and accrued liabilities (1,526,679) 4,908,483 Employee benefit obligations (17,195) 21,470 Unearned revenue 35,215 5,194 Provision for landfill and gravel pit closure and post -closure costs (342) (1,299) Other financial liability 62,431 -- 30,310,905 29,351,278 Capital activities: Proceeds on disposal of tangible capital assets 1,067,497 105,369 Cash used to acquire tangible capital assets (27,515,552) (27,210,062) (26,448,055) (27,104,693) Investing activities: (Increase) decrease in investments (12,334,346) 2,960,994 Notes receivable issued (1,350,000) -- Payments received on notes receivable 757,217 725,832 (12,927,129) 3,686,826 Financing activities: Repayment of long-term debt: - operating (553,786) (524,914) - capital (79,271) (75,419) Decrease in deposit liabilities (14,009) (74,084) (647,066) (674,417) Increase (decrease) in cash (9,711,345) 5,258,994 Cash and cash equivalents, beginning of year 48,943,069 43,684,075 Cash and cash equivalents, end of year $ 39,231,724 $ 48,943,069 The accompanying notes are an integral part of these consolidated financial statements. 4 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 1. Significant accounting policies: The consolidated financial statements of the County of Newell No. 4 (the "County") are the representations of management prepared in accordance with accounting principles for local governments as established by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants. Significant aspects of the accounting policies adopted by the County are as follows: (a) Reporting entity: The consolidated financial statements reflect the assets, liabilities, revenues and expenses, changes in net financial assets and cash flows of the County, which comprises of all the organizations that are owned or controlled by the County and are, therefore accountable to the Council for the administration of their financial affairs and resources. All significant inter -department transactions and balances are eliminated on consolidation. Taxes levied also include requisitions for educational, health care, social and other external organizations that are not part of the County. The statements exclude trust assets that are administered for the benefit of external parties. (b) Basis of accounting: The financial statements are prepared using the accrual basis of accounting. The accrual basis of accounting records revenue as it is earned and measurable. Expenses are recognized as they are incurred and measurable based upon receipt of goods or services and/or the legal obligation to pay. Funds from external parties and earnings thereon restricted by agreement or legislation are accounted for as deferred revenue until used for the purpose specified. (c) Investments: Investments are recorded at cost. Where there has been a loss in value of an investment other than a temporary decline, the investment is written down to reflect the loss. (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 amount requisitioned. If the actual levy exceeds the requisition, the over -levy is accrued as a liability and property tax revenue is reduced. Where the actual levy is less than the requisition amount, the under - levy is accrued as a receivable and as property tax revenue. Requisition tax rates in the subsequent year are adjusted for any over -levies for the prior year. 5 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 1. Significant accounting policies (continued): (e) Inventories: Land held for resale is recorded at the lower of cost and net realizable value. Cost includes costs for land acquisition and improvements required to prepare the land for servicing such as clearing, stripping, and leveling charges. Related development costs incurred to provide infrastructure such as water and waste water services, roads, sidewalks and street lighting are recorded as capital assets under their respective function. (f) Prepaid local improvements charges: Construction and borrowing costs associated with local improvement projects are recovered through annual special property assessments during the period of the related borrowing. These levies are collectible from property owners for work performed by the County. Where a taxpayer has elected to prepay the outstanding local improvement charge, such amounts are recorded as deferred revenue. Deferred revenue is amortized to revenue on a straight-line basis over the remaining term of the related borrowings. In the event that the prepaid amounts are applied against the related borrowing, the deferred revenue is amortized to the revenue by an amount equal to the debt repayment. (g) Landfill and gravel pit closure and post -closure costs: Pursuant to the Alberta Environment Protection and Enhancement Act, the County is required to fund the closure of its landfill site and gravel pits and provide for post -closure care. Closure and post -closure activities include the final clay cover, landscaping, as well as surface and ground water monitoring, leachate control and visual inspection. The requirement is being provided for over the estimated remaining life of the landfill site and gravel pit based on usage. (h) Government transfers: Government transfers are recognized in the financial statements as revenues in the period that the events giving rise to the transfer occurred, providing the transfers are authorized, all eligibility criteria have been met by the County, and reasonable estimates of the amounts can be made. (i) Non-financial assets: Non-financial assets are not available to discharge existing liabilities and are held for use in the provision of services. They have useful lives extending beyond the current year and are not intended for sale in the normal course of operations. M COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 1. Significant accounting policies (continued): (i) Non-financial assets (continued): (i) Tangible capital assets: Tangible capital assets are recorded at cost which includes all amounts that are directly attributable to acquisition, construction, development or betterment of the asset. The cost, less residual value, of the tangible capital assets is amortized on a straight-line basis over the estimated useful life as follows: Years Land Improvements 15-45 Buildings 25-70 Engineered structures 15-75 Machinery and equipment 540 Vehicles 5-14 Assets under construction are not amortized until the asset is available for productive use. (ii) Contributions of tangible capital assets: Tangible capital assets received as contributions are recorded at fair value at the date of receipt and recorded as revenue. (iii) Inventories Inventories of materials and supplies held for consumption are recorded at the lower of cost and replacement cost with cost determined by the average cost method. (iv) Cultural and historical tangible capital assets: Works of art for display are not recorded as tangible capital assets but are disclosed. 0) Use of estimates: The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. The County's implementation of the Public Sector Accounting Handbook PS3150 has required management to make estimates of historical cost where information was not available, and useful lives of tangible capital assets. Contributions of tangible capital assets are recorded at estimated fair value at the date of receipt. Actual results could differ from those estimates. 7 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 2. Cash and temporary investments: 2010 2009 Cash Temporary investments (effective average yield 2.95%) $ 19,143,611 20,088,113 $ 16,930,583 32,012,486 $ 39,231,724 $ 48,943,069 Included in cash are amounts aggregating $166,237 (2009 - $180,246) not available for current use. 2010 2009 Tax sale surplus Public reserve $ 13,209 153,028 $ 14,235 166,011 $ 166,237 $ 180,246 3. Taxes and grants in place of taxes receivable: 2010 2009 Current year Arrears $ 389,320 532,931 $ 279,540 436,631 Allowance for uncollectible taxes 922,251 (152,340) 716,171 (152,340) $ 769,911 $ 563,831 4. Investments: 2010 2009 Fixed income securities $ 16,320,717 $ 4,059,851 Newell Regional Services Corporation: Common shares 20 -- Preferred shares 73,460 -- 73,480 -- $ 16,394,197 $ 4,059,851 Long-term investments consist of fixed income securities with an effective average yield of 3.17% and an aggregate market value of $16,320,717 (2009 - $4,059,851). E. COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 5. Notes receivable: 89,516 $ -- $ 84,141 2010 2009 Newell Foundation, repayable in annual installments of 6. Tangible capital assets: $896,630 including interest at 5.5%, maturing in 2018. $ 5,679,764 $ 6,233,549 City of Brooks, repayable in annual installments of 33,134,040 $131,082 including interest at 5.25%, maturing in 2013. 355,302 462,122 Bow Slope Fire Division, repayable in annual installments of Disposals $32,113 including interest at 4.39%, maturing in 2013. 88,461 115,503 Rosemary Fire Division, repayable in annual installments of $ 2,394,683 $38,583 including interest at 5.125%, maturing in 2010. -- 36,702 Rolling Hills Fire Division, repayable in annual installments of 118,163 $39,585 including interest at 3.954%, maturing in 2014. 145,133 178,001 Division 2 Fire Hall repayable in annual installments of Buildings $96,327 including interest at 3.497%, maturing in 2020. 800,000 -- Newell Regional Services Corporation, repayable in annual 1,119,418 installments of $183,333, non-interest bearing, maturing 83,889,131 in 2013. 550,000 -- Land improvements $ 89,516 $ -- $ 84,141 $ 7,618,660 $ 7,025,877 6. Tangible capital assets: -- 22,873 397,949 Engineering structures 33,134,040 Cost 2009 Additions Disposals 2010 Land $ 2,898,011 $ 2,394,683 $ (689) $ 5,292,005 Land improvements 118,163 879,818 -- 997,981 Buildings 1,029,891 89,527 -- 1,119,418 Engineering structures 83,889,131 10,244,588 (363,875) 93,769,844 Machinery and equipment 9,607,362 192,316 (1,680,976) 8,118,702 Vehicles 3,315,504 185,358 (188,381) 3,312,481 Work in progress 10,513,063 15,197,179 -- 25,710,242 Total $111,371,125 $29,183,469 $ (2,233,921) $138,320,673 Accumulated Amortization amortization 2009 Disposals expense 2010 Land improvements $ 89,516 $ -- $ 84,141 $ 173,657 Buildings 375,076 -- 22,873 397,949 Engineering structures 33,134,040 (338,458) 2,250,398 35,045,980 Machinery and equipment 2,869,720 (794,596) 690,742 2,765,866 Vehicles 1,333,799 (124,834) 281,171 1,490,136 Total $ 37,802,151 $(1,257,888) $ 3,329,325 $ 39,873,588 9 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 6. Tangible capital assets (continued): Principal Interest Net book value 2010 2009 Land $ 5,292,005 $ 2,898,011 Land improvements 824,324 28,647 Buildings 721,469 654,815 Engineering structures 58,723,864 50,755,091 Machinery and equipment 5,352,836 6,737,642 Vehicles 1,822,345 1,981,705 Work in progress 25,710,242 10,513,063 Total $ 98,447,085 $ 73,568,974 Contributed assets are recognized at fair market value at the date of contribution. The value of contributed assets, comprised of land and engineering structures, received during the year is $1,667,917 (2009 - $624,420). 7. Employee benefit obligation: Vacation The vacation liability is comprised of the vacation that employees are deferring to future years. Employees have either earned the benefits (and are vested) or are entitled to these benefits within the next budgetary year. 8. Long-term debt — operating: 2010 2009 Debenture supported with notes receivable $ 5,679,764 $ 6,233,550 Principal and interest repayments are due as follows: $ 5,679,764 $ 1,493,276 $ 7,173,040 10 Principal Interest Total 2011 $ 584,243 $ 312,387 $ 896,630 2012 616,376 280,254 896,630 2013 650,277 246,353 896,630 2014 686,043 210,587 896,630 2015 723,775 172,855 896,630 Thereafter 2,419,050 270,840 2,689,890 $ 5,679,764 $ 1,493,276 $ 7,173,040 10 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 8. Long-term debt — operating (continued): Debenture debt is repayable to Alberta Capital Finance Authority and bears interest at 5.5% per annum, before Provincial subsidy, and matures in 2018. Debenture debt is issued on the credit and security of the County of Newell No. 4 at large. Interest on long-term debt amounted to $335,251 (2009 — $364,518). The County's total cash payments for interest in 2010 were $342,845 (2009 - $371,716). 9. Long-term debt — capital: 2010 2009 Tax supported debentures $ 425,150 $ 504,421 Principal and interest repayments are due as follows: $ 425,150 $ 58,601 $ 483,751 Debenture debt is repayable to Alberta Capital Finance Authority and bears interest at rates ranging from 4.307% to 11.75% per annum, before Provincial subsidy, and matures in periods 2010 through 2018. The average annual interest rate is 7.7% for 2010 (2009 — 7.7%). For qualifying debentures, the Province of Alberta rebates 60% of interest in excess of 8%, 9% and 11% to a maximum annual rate of 12.5%, depending on the date borrowed. Debenture debt is issued on the credit and security of the County of Newell No. 4 at large. Interest on long-term debt amounted to $22,659 (2009 - $26,511). The County's total cash payments for interest in 2010 were $22,659 (2009 - $26,511). 11 Principal Interest Total 2011 $ 75,460 $ 18,577 $ 94,037 2012 78,861 15,176 94,037 2013 82,418 11,619 94,037 2014 86,139 7,898 94,037 2015 90,032 4,005 94,037 Thereafter 12,240 1,326 13,566 $ 425,150 $ 58,601 $ 483,751 Debenture debt is repayable to Alberta Capital Finance Authority and bears interest at rates ranging from 4.307% to 11.75% per annum, before Provincial subsidy, and matures in periods 2010 through 2018. The average annual interest rate is 7.7% for 2010 (2009 — 7.7%). For qualifying debentures, the Province of Alberta rebates 60% of interest in excess of 8%, 9% and 11% to a maximum annual rate of 12.5%, depending on the date borrowed. Debenture debt is issued on the credit and security of the County of Newell No. 4 at large. Interest on long-term debt amounted to $22,659 (2009 - $26,511). The County's total cash payments for interest in 2010 were $22,659 (2009 - $26,511). 11 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 10. Provision for landfill and gravel pit closure and post -closure costs: Alberta environmental law requires closure and post -closure care of landfill sites, which includes final covering and landscaping, pumping of ground water and leachates from the site, and on- going environmental monitoring, site inspections and maintenance. The accrued liability for the remaining post -closure costs of the County's landfill and closure and post -closure costs for the County's gravel pit is based on an estimate of future discounted costs. The estimated closure and post -closure costs for the landfill are $339,507 and $293,701 for the gravel pits, all of which have been accrued in the financial statements. The County has not designated assets for settling closure and post -closure liabilities. 11. Accumulated surplus: Equity in tangible Unrestricted capital Total Total net assets assets (1) Reserves (2) 2010 2009 Beginning balance $ -- Excess of revenues over expenses 26,085,991 Transfer to reserves (40,610,524) Transfers from reserves 39,481,915 Amortization of tangible capital assets 3,329,325 Net book value of assets disposed 976,033 Capital assets internally $73,064,553 $56,623,033 $129,687,586 $101,827,656 -- -- 26,085,991 27,859,930 -- 40,610,524 -- -- -- (39,481,915) — -- (3,329,325) — -- -- (976,033) — -- -- funded (27,515,552) 27,515,552 — -- -- Contributed capital assets (1,667,917) 1,667,917 -- -- -- Principal payment on capital debt (79,271) 79,271 — -- -- Total $ -- $98,021,935 $57,751,642 $155,773,577 $129,687,586 12 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 11. Accumulated surplus (continued): (1) Equity in tangible capital assets: Tangible capital assets Accumulated depreciation Long-term debt (note 9) 2010 2009 $ 138,320,673 $111,371,124 (39,873,588) (37,802,150) (425,150) (504,421) $ 98,021,935 $ 73,064,553 (2) Reserves are comprised of funds internally restricted as follows: Operating: Annual Paving Tax Municipal surplus Debt reduction Future expenditures Brooks Recreation Centre Secondary highway #847 Special road project Hard surface Bow Slope fire truck Secondary highway #862 Rosemary fire truck Public transportation Agriculture Service Board Office renovations Purchase of gravel Planning Road work Fire truck Gravel crushing Public works - other Shop Economic Development Division #2 Fire Hall Reg. H2O Supply System Reserve Newell Regional Services Corp. 2010 2009 $ 16,451,337 $ 15,789,210 9,372,255 8,233,603 -- 1,509,116 1,640,492 1,634,408 355,302 462,122 690,893 679,185 -- 1,292,168 -- 295,862 88,461 115,503 209,040 273,116 -- 36,702 120,884 115,030 22,383 19,120 146,664 152,323 -- 128,746 139,796 105,429 142,320 111,120 29,122 92,406 -- 62,672 156,126 34,885 16,137 15,874 119,038 115,426 800,000 -- 461,473 3,702,839 550,000 -- 13 $ 31,511,723 $ 34,976,865 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 11. Accumulated surplus (continued): (2) Reserves (continued): 2010 2009 Operating: Budget 2010 Brought forward $ 31,511,723 $ 34,976,865 Municipal Sustainability Initiative 3,402,994 4,147,145 Water and waste water 6,306,512 8,713,787 Rolling Hills fire truck 145,133 178,001 $ 12,638,657 41,366,362 48,015,798 Capital: 27,206,532 Government grants in place of property Machinery and equipment 3,741,056 2,105,199 Future expenditures 267,499 284,764 - general administration 12,325,042 5,972,528 Vehicle replacement 64,070 442,293 Rolling Hills water and sewer 80,817 33,288 Scandia water reservoir 69,185 20,428 Patricia sewer 73,484 23,500 Lake Newell sewer 31,626 10,000 12,557,174 16,385,280 8,607,236 Net municipal property taxes $ 57,751,642 $ 56,623,034 12. Net municipal property taxes: 14 Budget 2010 2009 (Unaudited) Taxation: Real property taxes $ 12,604,408 $ 12,393,753 $ 12,638,657 Linear property taxes 25,284,301 25,228,093 27,206,532 Government grants in place of property taxes 267,499 284,764 286,551 38,156,208 37,906,610 40,131,740 Requisitions: Alberta School Foundation Fund 11,950,160 11,942,524 12,018,189 Newell Foundation 607,014 607,013 584,527 12,557,174 12,549,537 12,602,716 Net municipal property taxes $ 25,599,034 $ 25,357,073 $ 27,529,024 14 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 13. Government transfers: Budget 2010 2009 (Unaudited) Transfers for operating: Provincial government $ 1,826,882 $ 1,385,357 $ 1,618,698 Federal government 4,500 5,126 5,598 Local government 192,981 242,387 108,914 2,024,363 1,632, 870 1,733,210 Transfers for capital: Provincial government 27,302,665 15,180,346 23,093,670 Local government 2,265,609 2,007,968 3,678,060 29,568,274 17,188,314 26,771,730 $ 31,592,637 $ 18,821,184 $ 28,504,940 14. Expenditures by object: 15. Trust funds: The County holds fund related to the Land of Promise Scholarship aggregating $8,512 (2009 - $8,951) on behalf of others. These funds are not recorded in the financial statements. 15 Budget 2010 2009 (Unaudited) Salaries, wages and benefits $ 6,254,854 $ 5,731,502 $ 5,499,995 Contracted and general services 3,560,805 3,354,805 4,850,898 Materials, goods, supplies and utilities 2,300,054 1,935,961 2,009,729 Transfers to organizations 13,008,732 8,150,298 16,327,408 Bank charges and short-term interest 700 497 528 Interest on long-term debt 365,506 357,911 391,030 Other expenditures 179,190 38,960 70,262 Amortization 4,399,605 3,329,325 2,884,769 $ 30,069,446 $ 22,899,259 $ 32,034,619 15. Trust funds: The County holds fund related to the Land of Promise Scholarship aggregating $8,512 (2009 - $8,951) on behalf of others. These funds are not recorded in the financial statements. 15 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 16. Salary and benefits disclosure: Disclosure of salaries and benefits for elected municipal officials and the chief administrative officer as required by provincial regulation is as follows: 2010 2009 Benefits & Salary (1) Allowances (2) Total Total Council: Reeve $ 6,000 $ -- 6,000 $ 6,000 Division 1 27,255 4,012 31,267 27,032 Division 2 28,875 482 29,357 31,433 Division 3 34,905 4,336 39,241 34,146 Division 4 22,095 996 23,091 24,751 Division 5 24,150 3,413 27,563 29,508 Division 6 24,195 3,699 27,894 30,464 Division 7 25,035 3,932 28,967 28,724 Division 8 26,925 1,193 28,118 28,489 Division 9 34,800 1,808 36,608 36,141 Division 10 29,085 2,542 31,627 33,038 $ 283,320 $ 26,413 $ 309,733 $ 309,726 Chief Administrative Officer $ 163,041 $ 33,963 197,004 $ 179,205 Designated officer (1) $ 98,018 $ 23,035 121,053 $ 108,824 1) Salary includes regular base pay, bonuses, overtime, lump sum payments, gross honoraria and any other direct cash remuneration. 2) Benefits and allowances include the employer's share of all employee benefits and contributions or payments made on behalf of employees including pension, health care, dental coverage, vision coverage, group life insurance, accidental disability and dismemberment insurance, long and short-term disability plans, professional memberships and tuition. Benefits and allowances figures also include the employer's share of the costs of additional taxable benefits including special leave with pay, financial planning services, retirement planning services, concessionary loans, travel allowances, car allowances, and club memberships, if applicable. 16 COUNTY OF NEWELL NO.4 Notes to Consolidated Financial Statements Year ended December 31, 2010 17. Debt limits: Section 276(2) of the Municipal Government Act requires that debt and debt limits as defined by Alberta Regulation 255/00 for the County be disclosed as follows: 2010 2009 Total debt limit $ 45,193,529 $ 48,747,599 Total debt (6,104,914) (6,737,971) $ 39,088,615 $ 42,009,628 2010 2009 Debt servicing limit $ 7,532,255 $ 8,124,600 Debt servicing (990,667) (998,560) $ 6,541,588 $ 7,126,040 The debt limit is calculated at 1.5 times revenue of the County (as defined in Alberta Regulation 255/00) and the debt service limit is calculated at 0.25 times such revenue. Incurring debt beyond these limitations requires approval by the Minister of Municipal Affairs. These thresholds are guidelines used by Alberta Municipal Affairs to identify municipalities which could be at financial risk if further debt is acquired. The calculation taken alone does not represent the financial stability of the County. Rather, the financial statements must be interpreted as a whole. 18. Local authorities pension plan: The County participates in a multi-employer defined benefit pension plan. This plan is accounted for as a defined contribution plan. Employees of the County participate in the Local Authorities Pension Plan (LAPP), which is one of the plans covered by the Public Sector Pension Plans Act. The LAPP serves about 189,149 people and about 411 employers. The LAPP is financed by employer and employee contributions and investment earnings of the LAPP fund. Contributions for current service are recorded as expenditures in the year in which they become due. The County is required to make current service contributions to the Plan of 8.46% of pensionable earnings up to the year's maximum pensionable earnings under the Canada Pension Plan and 11.66% on pensionable earnings above this amount. Employees of the County are required to make current service contributions of 7.46% of pensionable salary up to the year's maximum pensionable salary and 10.66% on pensionable salary above this amount. Total current service contributions by the County to the LAPP in 2010 were $344,496 (2009 - $308,975). Total current service contributions by the employees of the County to the LAPP in 2010 were $310,361 (2009 - $276,072). At December 31, 2009, the LAPP disclosed an actuarial deficiency of $4,414 million. 17 COUNTY OF NEWELL NO. 4 Notes to Consolidated Financial Statements Year ended December 31, 2010 19. Contingent liabilities: The County of Newell No. 4 is a member of the Alberta Municipal Insurance Exchange (MUNIX). Under the terms of membership, the County of Newell No. 4 could become liable for its proportionate share of any claim losses in excess of the funds held by the exchange. Any liability incurred would be accounted for as a current transaction in the year the losses are determined. The County has been named defendant in legal actions. In the opinion of management this matter is without substantial merit and no provision has been made in the accounts. 20. Financial instruments: It is management's opinion that the County is not exposed to significant interest, currency or credit risk arising from these financial instruments. Unless otherwise noted, the fair values of these financial instruments approximate their carrying values. 21. Budget data: The unaudited budget data presented in these consolidated financial statements is based upon the 2010 operating and capital budgets approved by Council on December 10, 2009 and any subsequent budget adjustments. Amortization was not contemplated in development of the budget and, as such, has not been included. 22. Approval of financial statements: These financial statements were approved by Council and Management. 18 02 �C F- c n a c e c c ;m« G C C N N CO M N N to r- m m N O N M (O O Cl) 00 CN N N N — O IR!' Cl) 0 O) 00 r, RtM O N N r- CO O LO O M N M r- O M O O O 1- (7) O O N O V• O r- Go V• Cl) U) r- 00 r- It _N N r- Rt OD O M M o O r- � r- to N to V N CO N N N co U M — i r-�' Cl) V-) M M i i- O •- (O O N M C0 r- o O h CO O 00 O ' Cl) � ' ' ' ' ' , 00 C V' CN7 t0 ' t0 lq � .O - NM �- N to N0) Cl) U) (O ce)00m Oct r- rn N N r- V' V' CO CO O N d) d) M N It N M r- (O (O V' Cl) Cl) O N 00 M 61) ,It O U) Cl) O V' to CO N M V' - N 00 m to O N N N m CO N (M N N O N to M N O N r- V• 00 O M N CO N (O � V: V' N CO "I ocO U) toto CO N O)M to CO �-O r-ao N u)v O.- ,r -r -M N O V' to 0 N CO O N CD r- (M CO M Om LO CO Cl) V' O 10 00 CO LO M r O N M 00 N M (A M 00 M O O V' O O V' m N to O r- ;- O to m O r- VO' 000 COO -- N m V* O too 000 OO) N It O OO) CN N r V• Oo N M O O VO V• u) O r` M O O LO 00 M M M O M O M r-r-CD� _N N r- N CO (O LO V• V• r- r- to r - U' N N co U O 00 i r-�' (A V' O M M i i- O •- (O r- M C0 O N (O to O 00 N Mr- O OMO to r- N M—r- NO V• �- N M ' O U) U) 00 Oct r- rn U) r- r- o O 00 N V• �- U') V' N04 N Cl) N 0 61) ,It O U) Cl) O V' to CO N M V' - N 00 m to O N N N m CO N (M N N O N to M N O N r- V• 00 O M N CO N (O � V: V' N CO "I ocO U) toto CO N O)M to CO �-O r-ao N u)v O.- ,r -r -M N O V' to 0 N CO O N CD r- (M CO M Om LO CO Cl) V' O 10 00 CO LO M r O N M 00 N M (A M 00 M O O V' O O V' m N to O r- ;- O to m O r- VO' 000 COO -- N m V* O too 000 OO) N It O OO) CN N r V• Oo N M O O VO V• u) O r` M O O LO 00 M M M O M O M r-r-CD� _N M W M to r -MO— to M N M Cl) M Go LO MNN to O to Ch � C0 M N N N M m co CO N (A ' O V' cc M (O Oct O ' ' to r- O to O O r- M V' to 00 O M V' 1- 1 -OO O co (O Cl) (O to r- N CO ' to OctO a- N O OC(31 ' O U) U) r, LO COV' rnr- r- r- o O 00 N V• �- U') V' N04 N N N r- r- to N a- (O N V' Cl) Cl) O 00 to CO CA OM V' r-v(O MNN to M r 00 O N Cl) N V O CO (O m co CO Cl) ' m ' O V' cc M (O Oct O ' ' to r- O M V' r- t-- to co Cl) N rn r- CO N O M N 00 r- r- to CO CO o a- �r N OOr rnr- N N N 00 (n M M r- r- O M CO 0 0 O O O to O g tO C.- N 00 r- to OO OO M O Cl) O to t0 (O O) to 00 O i- M CO CO N r: O O O C O N N V' N M 0 r-mCOCe) 00NOr-CON ,t (C) V- tV N LO N Cl) O) Cl) V' Cl) O N to N O 00 Cl) O Cl) MCO V'O—O) to r- O)r-.- M—N U') 00 N N N 1 N N N d) N I6 OC w U) a y O EL o Q. x (ti Q. 01 O M O d O O N O U mw.N+ N- O. .= to C O E E U) N U O O 'D N c "' -O C O. C O ca c O m O E N O m N X t6 LL E: w - w ` G 7 O N Q CO/) O o> �zco a.5 a' r N N C N .O fl O Q O OCL O O S O N C 0 O tl) C6 c N t4 m w NO O m 0 cc c 2i -O O O 01 C O O O N C0 0 X f0 N Cep @�(D U N O N U) O C co c •O-' C N L O 1- It 11 cl q7 o CO N r v m r M C Cl) C M ' C Cl) C to u N rS r (o o c ccoo It C V' r O N IX N (O v OD r M O ' s Co 0 N C N N coo IX N CO r 00 (c N to IX O CA . V O tf U) 't r 0 ' Q a U N t c N