Financial Statements of BOYS & GIRLS CLUB SERVICES OF GREATER VICTORIA - March 31, 2025

INDEPENDENT AUDITOR'S REPORT

To the Members of Boys & Girls Club Services of Greater Victoria

Opinion

We have audited the financial statements of Boys & Girls Club Services of Greater Victoria (the Entity), which comprise:

• the statement of financial position as at March 31, 2025
• the statement of operations and net assets for the year then ended
• the statement of cash flows for the year then ended
• and notes to the financial statements, including a summary of significant accounting policies

(Hereinafter referred to as the "financial statements").

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Entity as at March 31, 2025 and its results of operations and its cash flows for the year then ended in accordance with Canadian accounting standards for not-for-profit organizations.

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the "Auditor's Responsibilities for the Audit of the Financial Statements" section of our auditor's report.

We are independent of the Entity in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada and we have fulfilled our other ethical responsibilities in accordance with these requirements.

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

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the financial statements in accordance with Canadian accounting standards for not-for-profit organizations, 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.

In preparing the financial statements, management is responsible for assessing the Entity's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Entity or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Entity's financial reporting process.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit.

We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit 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.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Entity to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Report on Other Legal and Regulatory Requirements

As required by the Societies Act (British Columbia), we report that, in our opinion, the accounting policies applied in preparing and presenting the financial statements in accordance with Canadian accounting standards for not-for-profit organizations have been applied on a basis consistent with that of the preceding period.

Chartered Professional Accountants Victoria, Canada July 7, 2025

BOYS & GIRLS CLUB SERVICES OF GREATER VICTORIA

Statement of Financial Position

March 31, 2025, with comparative information for 2024

Commitments (note 6) Subsequent events (note 10)

BOYS & GIRLS CLUB SERVICES OF GREATER VICTORIA

Statement of Operations and Net Assets

Year ended March 31, 2025, with comparative information for 2024

BOYS & GIRLS CLUB SERVICES OF GREATER VICTORIA

Statement of Cash Flows

Year ended March 31, 2025, with comparative information for 2024

BOYS & GIRLS CLUB SERVICES OF GREATER VICTORIA

Notes to Financial Statements

Year ended March 31, 2025

Boys & Girls Club Services of Greater Victoria ("Club Services") is a registered charity and is incorporated under the Societies Act (British Columbia). The primary mission of Club Services is to provide a safe, supportive place where children, youth and families can experience new opportunities, overcome barriers, build positive relationships and develop confidence and skills for life. We believe that neighbourhood and community-based approaches that reach out to children, youth and families hold the greatest potential for fulfilling our agency mission and our various programs and services are designed with that belief in mind.

1. Significant accounting policies:

These financial statements have been prepared in accordance with Canadian accounting standards for not-for-profit organizations and include the following significant accounting policies:

(a) Fund accounting:

The Operating Fund reports the assets, liabilities, revenues and expenses related to program delivery and administrative activities.

The Capital Fund reports assets, liabilities, revenues and expenses related to property and equipment and amounts held for future repairs, improvements or purchases of property and equipment.

The Bull Memorial Fund is an internally restricted fund established to honour the memory of Colonel R. Bull, founder and long-time supporter of Club Services. On September 19, 2024, the Board approved the removal of restrictions on the Bull Memorial Fund, resulting in the closure of the fund.

(b) Contributed materials and service:

Donated materials and services are recognized in the financial statements when a fair value can be reasonably established, when the materials and services are used in the normal course of operations and would otherwise have been purchased.

A number of people donate time and expertise to Club Services across its operations. As no objective basis exists to record and assign fair values to such contributions, the value of this time has not been reflected in these financial statements.

(c) Revenue recognition:

Club Services follows the deferral method of accounting for contributions. Restricted contributions are recognized as revenue of the appropriate fund in the period in which the related expenses are incurred. Unrestricted contributions are recognized as revenue when received or receivable if the amount to be received can be reasonably estimated and collection is reasonably assured.

Contributions restricted for the purpose of acquiring property and equipment are initially deferred and subsequently recognized as revenue on the same basis as the acquired assets are amortized.

Investment income, recorded on the accrual basis, includes interest income, dividends and net gain (loss) on investments, including holding gains (losses).

(d) Financial instruments:

Financial instruments (financial assets and financial liabilities) are recorded at fair value on initial recognition. Investments are subsequently measured at fair value and all changes in the fair value are recognized in net income in the period incurred. All other financial instruments are subsequently recorded at cost or amortized cost, unless management has elected to carry the instruments at fair value. Club Services has not elected to carry any such financial instruments at fair value.

Transaction costs incurred on the acquisition of financial instruments measured subsequently at fair value are expensed as incurred. All other financial instruments are adjusted by transaction costs incurred on acquisition and financing costs, which are amortized using the straight-line method.

Financial assets are assessed for impairment on an annual basis at the end of the fiscal year if there are indicators of impairment. If there is an indicator of impairment, Club Services determines if there is a significant adverse change in the expected amount or timing of future cash flows from the financial asset. If there is a significant adverse change in the expected cash flows, the carrying value of the financial asset is reduced to the highest of the present value of the expected cash flows, the amount that could be realized from selling the financial asset or the amount Club Services expects to realize by exercising its right to any collateral. If events and circumstances reverse in a future period, an impairment loss will be reversed to the extent of the improvement, not exceeding the initial carrying value.

(e) Property and equipment:

Property and equipment is recorded in the Capital Fund at cost. Contributed property and equipment are recorded in the Capital Fund at fair value at the date of contribution at fair value at the date of contribution. Amortization is computed using the declining balance method at the following rates calculated to amortize the cost of the assets over their estimated useful lives. Amortization is reported in the Capital Fund.

When equipment or property no longer has any long-term service potential to Club Services or the value of future economic benefits is less than net carrying amount, the excess of its net carrying amount over any residual value is recognized as an expense in the statement of operations.

(f) Government assistance:

Government assistance related to current expenses and revenues is included in the determination of excess of revenue over expenses for the period. Government assistance related to capital expenditures is recorded as a reduction of the cost of the related item of capital assets.

(g) Use of estimates:

The preparation of the financial statements 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 date of the financial statements and the reported amounts of revenue and expenses during the year. Actual results could differ.

2. Property and equipment:

2025

2024

During the periods presented, Club Services did not receive any donations of property or equipment.

3. Deferred revenue and deferred capital contributions:

(a) Deferred revenue:

Deferred revenue in the Operating Fund comprises externally restricted operating grants received in the current year or a prior year which will be recognized as revenue when the related costs are incurred.

(b) Deferred capital contributions:

Deferred capital contributions in the Capital Fund comprise unamortized externally restricted contributions.

4. Related party:

Club Services is a related party to the Boys & Girls Clubs of Greater Victoria Foundation (the "Foundation"). The Boards may have certain directors in common. The Foundation is dedicated to enhancing the quality of life in our community through the establishment and stewardship of endowment, capital and operating funds and the distribution of those funds in support of the aims and interests of Club Services and other institutions, groups or persons in respect of activities relating to youth. The Foundation is incorporated under the Society Act (British Columbia) and is a registered charity.

During the year, the Foundation made contributions to Club Services of $586,098 (2024 - $580,750) to support programs operated by Club Services. Administration costs of $75,690 (2024 - $138,053) were incurred by Club Services and recovered from the Foundation. The Foundation charged Club Services $55,167 for use of facilities (2024 - $nil). At March 31, 2025, accounts receivable of Club Services includes balances receivable from the Foundation totaling $1,549,562 (2024 - $546,702).

During the year, Club Services forgave an amount owing from Foundation of $90,853 (2024 - nil), related to Bull Memorial Fund.

5. Financial instruments:

Club Services' financial instruments include cash and short-term investments, accounts receivable and accounts payable and accrued liabilities.

Club Services is exposed to interest rate risk through its cash and short-term investments. Interest rate risk is managed through investment in mostly fixed rate investments with investment terms estimated to match cash flow needs. Credit risk is the risk that a third party to a financial instrument might fail to meet its obligations under the terms of the financial instrument. Club Services manages the risk associated with credit risk through its policy of dealing with high credit quality financial institutions. Receivables from program participants are monitored regularly and allowances for uncollectability established as needed.

Liquidity risk is the risk that Club Services will be unable to fulfill its obligations on a timely basis or at a reasonable cost. Club Services manages its liquidity risk by monitoring its operating requirements.

6. Commitments:

In August 2024, Club Services entered into a two year Lease Agreement with 0822878 B.C. Ltd. The lease property is used as the head office location for the administration staff. Monthly payments, excluding taxes and operating costs, are $2,900 until August 31, 2025, and $2,976 for the remaining term until August 31, 2026. Payments excluding taxes and operating costs are due over the remainder of the lease term as shown below:

2026: $ 35,408

Club Services entered into a three year Lease Agreement with Point Ellice Holdings Ltd. The lease property is used with our full time attendance programming and other programs as may be deemed necessary. Monthly payments, excluding taxes and operating costs, of $5,000 are due over the remainder of the of the term until August 31, 2026.

In May 2014, Club Services entered into a twenty-five year License Agreement with the District of Central Saanich in respect of the use of land upon which Club Services constructed a new facility to house after school and other programming. That facility was constructed during 2014 and became operational in January 2015. Under the terms of the License Agreement, a nominal annual rent is charged to Club Services.

7. Accounts payable and accrued liabilities

Included in accounts payable and accrued liabilities are government remittances payable of $27,549 (2024 - $20,895 receivable).

8. Remuneration paid to employees, directors and contractors:

The BC Societies Act came into effect on November 28, 2016. The Act has a requirement for the disclosure in the financial statements of the remuneration of directors, employees and contractors for the financial statements prepared after November 28, 2016. For employee and contractor remuneration the requirement is to disclose amounts paid to individuals whose remuneration was greater than $75,000. For the 12 months ending March 31, 2025, the Society paid remuneration of $433,080 to five employees (2024 - $255,006 to three employees), who received total annual remuneration of $75,000 or greater.

9. Comparative information:

Certain comparative information has been reclassified to conform to the financial statement presentation adopted in the current year.

10. Subsequent events:

(i) Club Services entered into an Operator agreement with School District No. 62 (Sooke) to operate out of school care for children or students attending 7 licensed schools. Club Services will participate in the Ministry of Education and Child Care - Child Care Operating Funding Program and the Child Care Fee Reduction Initiative and support families who qualify for the Affordable Child Care Benefit.

The term of the agreement for 6 schools is from September 1, 2025 to June 30, 2026. The term of the lease for the 7th school is 5 years from September 1, 2025 to August 1, 2023. Club Services is responsible for lease payments for 7 sites for approximately $99,000 per annum.

(ii) On July 5, 2024, the British Columbia Labour Relations Board certified BC General Employees' Union (BCGEU) as the bargaining agent for certain employees of Club Services. Effective January 13, 2025, these employment terms will be negotiated under a collective agreement. The financial impacts of unionization include classifying positions under existing union categories which will result in increases in compensation to unionized and non-unionized employees. The increase will result in an increase in government grants for those delivering services under a government-funded program. Club Services will also become a member of the Municipal Pension Plan. Estimated costs that will be paid related to fiscal 2025 have been accrued in the financial statements. The full impact of unionization continues to be evaluated by Club Services.