Presentation: 2020 Consolidated Financial Statements

Contents

• Management’s responsibility for financial reporting
• Consolidated Statements:
  • Financial Position
  • Operations
  • Net Financial Assets
  • Cash Flows
  • Notes
  • Segment Disclosures
  • Tangible Capital Assets
• Independent Auditor’s Report
• Audit Findings Report

Who does what?

Management’s responsibility

• To prepare compliant financial statements that are objective, consistent and have integrity

Mayor and Council’s responsibility

• Make sure management does its job
• Meet with management and auditors to review and discuss matters

Auditor’s responsibility

• Conduct independent examination
• Evaluate the systems of internal control
• Express an opinion on the financial statements – do they fairly represent the actual position of the Town?

Consolidated Statement of Financial Position

• aka Balance Sheet
• Statement A
• Where are we at on December 31, 2020?
• Net financial assets (debt)
• Non-financial assets
• Accumulated surplus
• Note the NOTES!

Sustainability Ratios: Assets and Surplus

Town of View Royal Consolidated Statement of Financial Position

as at December 31, 2020

Consolidated Statement of Operations

• aka: Income Statement
• Statement B
• What happened in 2020?
• Revenue
• Expense
• Annual surplus (deficit)
• Accumulated surplus = Statement A

Sustainability Ratios: Net Financial Assets

Town of View Royal Consolidated Statement of Operations

Year ended December 31, 2020

Consolidated Statement of Change in Net Financial Assets

• aka Change in financial equity
• Statement C
• Takes the non-financial assets out of the annual surplus, so we have a better understanding of our net financial asset position

Town of View Royal Consolidated Statement of Change in Net Financial Assets

Year ended December 31, 2020

Consolidated Statement of Cash Flows

• Statement D
• Where did the cash come from and how was it used?
• Reports the change in cash and investments in the period, and how the Town financed its activities

Town of View Royal Consolidated Statement of Cash Flows

Year ended December 31, 2020

Notes to Consolidated Financial Statements

• aka “Notes”
• Context
• Accounting policies
• Details
• Information

1. Significant accounting policies

a) Principles of consolidation The Town follows Canadian public sector accounting standards. The consolidated financial statements of the Town are prepared in accordance with the recommendations of the Public Sector Accounting Board (PSAB).

b) Reporting entity The consolidated financial statements reflect the combined assets, liabilities, accumulated surplus, revenue and expense of all of the Town's activities and funds. The consolidated financial statements also include the Town's proportionate share of the West Shore Parks and Recreation Society (West Shore). Interfund transactions and fund balances have been eliminated on consolidation.

c) Basis of accounting The Town follows the accrual method of accounting for revenue and expense. Revenue is normally recognized in the year in which it is earned and measurable. Expense is recognized as it is incurred and measurable as a result of receipt of goods or services and/or the creation of a legal obligation to pay. Expense paid in the current period and attributable to a future period is recorded as prepaid expense.

d) Property tax revenue Property tax revenue is recognized at the date property tax notices are issued, based on property assessment values issued by BC Assessment for the current year and tax rates established annually by bylaw. Assessments are subject to appeal and tax adjustments are recorded when the results of appeals are known.

Note 10. Accumulated surplus

Accumulated surplus consists of individual fund surplus and reserve funds as follows:

Consolidated Schedules of Segment Disclosure by Service

• aka Segmented Info
• Schedules 1 and 2
• Schedule 1 – current year (with budget)
• Schedule 2 – prior year (with budget)
• Describes R & E categories for each function shown on Statement B

Statement B functions:

• General Government
• Protective
• Transportation
• Environmental Health
• Development
• Recreation & Culture

Scheds 1 & 2 categories:

• Labour & benefits
• Goods & services
• Amortization
• Debt interest
• WSPR change in share

Town of View Royal Consolidated Schedule of Segment Disclosure by Service

Year ended December 31, 2020 - Schedule 1

Town of View Royal Consolidated Schedule of Segment Disclosure by Service

Year ended December 31, 2020 - Schedule 2 (Prior Year Comparisons)

Consolidated Schedule of Tangible Capital Assets

• aka TCA Schedule
• Schedule 3
• Details for each category of TCA:
  • Historical costs
  • Additions and disposals in the year
  • Amortization
  • Net book value
• Includes prior year comparatives

Town of View Royal Consolidated Schedule of Tangible Capital Assets

Year ended December 31, 2020

Flexibility Ratios

Vulnerability Ratios