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Home My WebLink About2013 Financial StatementsCONSOLIDATED STATEMENT OF FINANCIAL POSITION CONSOLIDATED STATEMENT OF FINANCIAL ACTIVITIES CONSOLIDATED STATEMENT OF CHANGES IN NET FINANCIAL ASSETS CONSOLIDATED STATEMENT OF CASH FLOW SCHEDULE 1 -TANGIBLE CAPITAL ASSETS SCHEDULE 2 - NET TAXES FOR MUNICIPALPURPOSES SCHEDULE 3 - SCHEDULE OF GOVERNMENT TRANSFERS SCHEDULE 4 - CONSOLIDATED EXPENSES BY OBJECT SCHEDULE 5 - CONSOLIDATED SCHEDULE OF SEGMENT DISCLOSURE NOTES TO FINANCIAL STATEMENTS ll 463 342 2500 QDQ Canada LLP JBDO Fax: 403 343 3070 AMUenniurn Centre wrvw.bdo,ca 606, 4909 49th Street Red Deer AS T4N 'i V7 Canada To the Reeve and Council of Kneehill County We have audited the accompanying consolidated financial statements of Kneehill County, which comprise the statement of financial position as at December 31, 2013, and the consolidated statements of financial activities, consolidated statement of changes in net financial assets and consolidated statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information: Management's Responsibility for the f=inancial 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. Auditor's 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 Kneehill County as at December 31, 2013 and its results of operations and its cash flows for the year then ended in accordance with Canadian public sector accounting standards. Red Deer, Alberta April 22, 2014 Chartered Accountants EOO Canada LIP, a Canadian limited haMix, partrrer,Hp, is s membor pf OOOlntor,ot,t =at Um,Led, a.UKc=, ,y H,riter b} guarantee, d;d farms partOf the intenldtionat BDO netwodoof iodependwt memki firms, As at December 2013 Cash and temporary investments (Note 3) Receivables Taxes and grants in place of taxes (Note 4) Trade and other receivables (Note 5) Other assets (Note 6) Tax sale trust Land held for resale LIABILITIES Accounts payable and accrued liabilities Deposit liabilities Deferred revenue (Note 7) Employee benefit obligations (Note 8) Provision for landfill closure and postclosure costs (Note 9) Tax sale trust Trochu recreation trust Long term debt (Note 10) NON-FINANCIAL ASSETS Inventory for consumption (Note 12) Tangible capital assets (Note I3) Prepaid expenses 1 Kneehill County 2013 MOM 0 11,894 75,907 1,715;363 55,000 56,194 632,105 188,425 11,894 31,151 7,517,865 21,774,917 5,110,872 105,686,275 158,985 (' r 132,731,049 2012 25,136,766 320,665 1,524,447 122 11,894 75,904 27,069,799 1,548,737 55,004 628,194 645,016 96,515 11,894 26,332 9,884,758 12,896,446 14,173,353 5,168,684 104,743,538 178,648 110,090,871 124,264,224 eehill County Consolidated Statement of Financial Activities For the year ended December 31, 2013 Budget 2013 2012 REVENUE Net municipal taxes (Schedule 2) 21,041,328 20,844,104 20,311;675 User fees and sales of goods 662,775 833;518 828,449 Sales to other governments 51,600 73,169 72,196 Drilling licenses 75,000 117;843 44,248 Fees, licenses, permits, fines 130;850 152;209 146;523 Interest and patronage dividends 232,000 324,013 219;372 Rentals 54,100 69,815 63;529 Penalties and interest on taxes 65,000 65;406 66;651 Provincial government transfers (Schedule 3) 2,443;408 2,823;740 2;247;953 Local government transfers(Schedule 3) 263,690 268;331 323,887 Local improvement charges 402;900 489,607 846,015 Gain on sale of capital assets - - - Other 52;900 126,814 168,538 25,475,551 26;188,569 25,339,036 EXPENSES Legislative 366,075 411,084 334,002 Administration 1,959,263 1,902,580 1,573,290 Assessment 384,944 419,013 364,500 Fire services and safety program 877,242 735,158 829,243 Enforcement 411;094 381,286 375,482 Disaster services 6,000 3,678 18,018 Transportation 10,395,850 9,906,165 10;181,237 Bridges 1;017;978 459,002 431,816 Water supply and distribution 2,102;444 2,244,004 2,129,728 Sewer 152;339 136,483 138,150 Garbage and recycling 484,036 521,289 447,763 Community support services 950,621 923,267 872,969 Health services and cemetery 97;671 32,352 106,446 Planning 500,376 397,876 347;880 Agricultural services board 639,276 681,618 557,647 Parks, recreation and culture 783,912 607,803 675,435 Loss on disposal of assets - 194;778 430,292 Other 201,243 194,734 49,199 21,330,364 20,152,168 19,863,098 EXCESS OF REVENUES OVER EXPENSES -]BEFORE OTHER 4,145,187 6;036,401 5;475,938 a Kneehill County r r' For the year ended December 31, 2013 Budget 2013 2012 $ $ EXCESS OF REVENUES OVER EXPENSES -BEFORE OTHER (Cont'd) 4,145,187 6,036;401 5,475,938 OTHER Provincial capital transfers 2,200,000 2,343,524 2,815,271 Federal capital transfers - - - Local government capital transfers - - - Contributed assets - 35,536 246,861 Transfers to local governments for capital - - Other - (1,936) (27) EXCESS (SHORTFALL) OF REVENUE OVER EXPENSES 6,345,187 5;466,525 8,539,042 124,264;224 124,264,224 115,725;181 ACCi1M, SURPLUS, END OF YEAR 130,609,411 132;731,049 124;264,224 3 eehill County Consolidated Statement of Changes in Net Financial Assets For the year ended December 31, 2013 (2;907,588) Budget 2013 2012 (174,466) 3,332,700 8 5 EXCESS (SHORTFALL) OR REVENUE 174,622 153,282 OVER EXPENSES 6,345,187 8,466,825 8;539,042 Acquisition of tangible capital assets (6,734,160) (6,774,086) (9,265,273) Contributed assets - (38,836) (246,861) Proceeds on disposal of tangible capital assets 506;000 878,884 1,247,177 Amortization of tangible capital assets 4,796,522 4,796,522 4,870,547 (Gain) loss on disposal of tangible capital assets - 194,778 430,292 Acquisition of supplies inventory Acquisition of prepaid assets Use of supplies inventories Use of prepaid assets (1,431,638) (942,737) (2,964,118) (4,555;200) (2;907,588) (3;993,692) (150,000) (154,957) (174,466) 3,332,700 2,965,399 3,115;191 150,000 174,622 153,282 (1,222,500) 77,476 (899;685) 3,691,049 7,601,564 4,675,239 14,173,353 14,173,353 9,498,113 NET FINANCIAL ASSE'T'S, END OF YEAR 17,864,402 21,774,917 14,173,353 91 eehill County Consolidated Statement of Cashflows For the year ended December 31, 2013 2013 2012 S $ NET INFLOW (OUTFLOW) OF CASH RELATED TO THE FOLLOWING ACTIVITIES; OPERATING Excess (deficiency) of revenues over expenditures 8,466,825 8,539,042 Non-cash items included in excess(deficiency) of revenue over expenses: Contributed assets (38,836) (246,861) Amortization of tangible capital assets 4,796,522- 4,870,547 (Gain) loss on disposal of tangible capital assets 194,778 430,292 Non-cash charges to operations (net change): Decrease(increase) in taxes and grants in place of taxes 202,498 49,802 Decrease (increase)in trade and other receivables 650,614 1,704,903 Decrease (increase) in other assets 4,815 8,057 Decrease (increase) in inventory for consumption 57,813 (878,501) Decrease (increase)in prepaid expenses 19,664 (21,184) Increase(decrease)in accounts payable and accrued liabilities 166,626 93,712 Increase (decrease) in deposit liabilities - (26,205) Increase (decrease) in employee benefit obligations (12,911) 93,658 Increase (decrease) in provision for landfill, closure/postclosure 91,910 7,723 Increase (decrease) in deferred revenue (571,999) (160,005) Cash provided by (applied to) operating transactions CAPITAL Acquisition of tangible capital assets Sale of tangible capital assets Cash prodded by (applied to) capital transactions INVESTING Decrease (increase) in restricted cash and temp. investments Cash provided by (applied to) investing transactions FINANCING Long-tenn debt issued Long-term debt repaid Cash provided by (applied to) financing transactions 14;464,981 (9,265,273) 1,247,177 {8,018,096) (2,366,893) (2,288,333) (2,366,893) (2,288,333) CHANGE IN CASH AND EQUIVALENTS IN THE YEAR 5,766,224 4,158,552 nn= For the year ended December 31, 2013 2013 2012 INM I'lla 30,902;990 4,158,552 20,978,213 25,136,766 Y y N N hl h �V N - N' M M Q O Ql I� �N Ot W M M w1 �r h a0 h M N �n cn c+ vi SF N Cd v N .f M N m C N J m W �fl a ^ M N N - N' M M G1 47 O h ti O O' W m W M M w1 a0 h M N �n cn c+ vi SF N Cd v N .f M N m C N J m W �fl a ^ M N N - N' M M O O' W m W M h V1. G1..M :n W n m o �r O ro 49 � u � � W N CO M h . n c a C a o o a �m ¢q33 I N - a w ea .o h V1. G1..M o� Vl N CO M h h M 4n a. r N Vl C U' N M Sal P I N - a w ea .o o� a' H I Kneehill County Schedule 2 ® Net Taxes for Municipal Purposes For the year ended December 31, 2013 Budget 2013 2012 TAXATION Farmland 1,421,799 1,429,765 1,425;293 Residential 2,698,229 2;695;576 2,535,952 Commercial 2,174;687 1,955;722 2,093,216 Linear property 15,769,421 15,751;929 14,765;515 Machinery and equipment 4,125,208 4,137,454 4,070 146 Railway 13;000 16,167 13;975 Minimum tax - - Grants inlieu 3,100 3,074 3,207 Local improvement tax (rural) 85,055 52,132 75,358 Local improvement tax (non residential) 1,326;976 1,255,199 1,270,024 27,617,475 27,390,352 26,252,685 QUISTTIONS Alberta School Foundation Fund 6,555,747 6,525,755 5,925,032 Knechill Foundation 20,400 20,463 15,978 NET MUNICIPAL TAXES 21,041,328 20,544,104 20,311,675 N the vear ended December 31, 2013 TRANSFERS FOR OPERATING Provincial government Other local governments Provincial government Local government Federal government Kneehill County Budget 2013 2012 2,443,408 2,823,740 2,247,953 263,690 268;331 323;887 2,707,098 3,092,071 2,571,840 2,200,000 2,393,524 2,816,271 2,200,000 2,393,524 2,816,271 4,907,098 5,485,595 5,388,111 01 For the Year ended December 31, 2013 CONSOLIDATED EXPENSES BY OBJECT Salaries, wages and benefits Contracted and general services Purchases from other governments Materials; goods, supplies and utilities Transfer to other governments Transfers to individuals and organizations Bank charges and interest Interest on debenture Amortization expense Loss on disposal of assets Property taxes cancelled Other Kneehill County Kr, Budget 2013 2012 6,725,264 6,432,919 6,322,647 5,074,394 4,009,057 3,715,574 302,035 264,401 286,983 2,863;665 2,973,836 2,859,916 369;518 354,379 363,131 641,376 486,990 524,896 1,680 1,263 1,256 354,671 351,265 429,946 4,796,522 4,796,522 4,870,547 - 194,778 430,292 - - 749 201,243 286,759 57,163 Ift 21,330,364 20,152,168 14;863,098 or - �owoca re ( o Ka ev �, o � N 1 N i. M V 4Pi' O: r 0 V" V M Yl: , p V� i y . a Ol M f� W C O. t4 11" co N N M in m N W O C cl Gi. N le r vi m a: l vi -i 'IF p�. N iM M N m in N r V h N O Vt N 1p Vi'Q "t� b in V` w m ry H M � 1 O ^+ in t� Q N ca 'n In m m ~� hl in m N W O C cl Gi. N le r vi m a: l vi -i 'IF p�. N iM i M N m in N r V h N O Vt N 1p Vi'Q "t� b in V` w m ry H M � 1 O ^+ in t� Q N ca 'n In m m ao i b N Ot M N r V h N O Vt N 1p Vi'Q "t� b r w m ry H M � 1 O ^+ in m F Q N N y w [ eq Vt N 1p Vi'Q "t� b r 4t N H Qy � 1 O ^+ in t� Q N ca 'n In m m m F Q oli a rn m M Vt N 1p Vi'Q "t� Oi 4t N 1 O ^+ in t� Q N ca 'n In m m m F Q Kneehill County PoliciesUeff_Wicant Accounting The financial statements of Kneehill County ("the County") are the representations of management prepared in accordance with Canadian generally accepted accounting principles for local governments established by the Public Sector Accounting Board of the Canadian Institute of Chartered Accountants. Significant aspects of accounting policies adopted by the County are as follows: (a) Reporting Entity The financial statements reflect the assets, liabilities, revenues and expenses, changes in fund balances and changes in cash flows of the reporting entity. The financial statements include all organizations that are accountable for the administration of their financial affairs and resources to the County and are controlled by the County. The schedule of taxes levied also includes requisitions for education, health and social, and other external organizations that are 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 and balances are eliminated. (b) Basis of Accounting Revenues are accounted for in the period in which the transactions or events occurred that gave rise to revenues. Funds from external parties and earnings thereon that are restricted by agreement or legislation are accounted for as deferred revenue until used for the purpose specified. Government transfers are recognized in the financial statements as revenues in the period that the events giving rise to the transfer occurred, providing that the transfers are authorized, the County has met any eligibility criteria, and reasonable estimates of the amounts can be made. Expenditures are recognized in the period the goods and services are acquired and a liability is incurred or transfers are due. RIVA Kneehill Count Notes to Financial Statements For the year ended December 31, 2013 1, Significant Accounting Policies c) Use of Estimates The preparation of financial statements in conformity with Public Sector Accounting Board requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the period. Where measurement uncertainty exists, the financial statements have been prepared with reasonable limits of materiality. Actual results could differ from those estimates. (d) Temporary Investments Temporary investments are recorded at cost and represent short-term bank deposits with original maturities of 90 days or less. The short-term bank deposits earned interest at rates from 0.5% to 2.16% per annum. (c) Investments Investments are recorded at cost and represent short -tern bank notes and deposits that have effective interest rates of 1.25% to 2.55% and mature in less than one year but after 90 days. (f) Inventories For Consumption Inventories of materials and supplies for consumption are values at the lower of cost or replacement value with cost determined by weighted average cost method. Inventory of gravel is maintained by perpetual records and is recorded in the accounts to the extent of royalties, land costs, crushing costs incurred, hauling and equipment rental costs. Land held for resale is recorded at the lower of cost or net realizable value. Cost includes costs for 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 tangible capital assets under their respective function. 13 For the year ended December 1. Significant Accounting Poficies (g) Pension Expenditure The County participates in a multi-employer defined benefit pension plan. The plan is accounted for as a defined contribution plan. (h) Landfill Closure and Post -Closure Liability Pursuant to the Alberta Environmental Protection and Enhancement Act, the County is required to fond the closure of its landfill site and provide for post -closure care of the facility. Closure and post -closure activities include, but not limited to; 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 estimate of the remaining life of the landfill site-based on usage. (i) Government Transfers Government transfers are the transfer of assets from senior levels of government that are not the result of an exchange transaction, are not expected to be repaid in the future, or as a result of a direct financial return. Government transfers are recognized in the financial statements as revenue in the period in which events giving rise to the transfer occur, providing the transfers are authorized, any eligibility criteria have been met, and reasonable estimates of the amount can be determined. 0) 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 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 or under -levies of the prior year. 14 Knee ill County ;Notes to Financial Statements For the year ended December 31, 2013 1, Significant Accounting Policies (k) 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. The change in non-financial assets during the year, together with the excess of revenues over expenses, provides the consolidated Change in Net Financial Assets for the year, (i) Tangible Capital Assets Tangible capital assets are recorded at cost which includes all amounts that are directly attributable to the 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, in years, as follows: Land improvements 10-20 Buildings 25-50 Engineered structures: Water system 15-75 Wastewater system 25-60 Other engineered structures 6-100 Machinery and equipment 5-45 Vehicles 5-20 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 recordedat fair value at the date of receipt and are also recorded as revenues. 15 For the year ended December 31, 2013 1. Significant accounting Policies (iii) Leases Leases are classified as capital or operating leases. Leases which transfer substantially all of the benefits and risks incidental to ownership of property are accounted for as capital leases. All other leases are accounted for as operating leases and the relating lease payments are charged to expenses as incurred. (iv) Inventories Inventories held for consumption are valued at the lower of cost or replacement value with cost determined by weighted average cost method. 2. Compliance to Budget Requirements The legislative requirements for the Financial Plan (Budget) are that cash inflows for the period must be equal to cash outflows. Cash inflows and outflows could include such items as: debt proceeds and debt payments, transfers to and from reserves, and asset sale proceeds. These items are not recognized as revenues or expenses in the Consolidated Statement of Operations; as they do not meet the definition in the public sector accounting standard requirements. The legislation does not require (but does preclude) the funding of the cash items as liability accruals or amortization to provide for future cash requirements, thus, there is no requirement to include them in the budget. However, these items are recognized in the Consolidated Statement of Operations as an expense. The financial items included in the legislative budget and Public Sector Accounting Handbook Statement is different. The purpose of this note is to explain the difference between the two requirements and demonstrate how the requirements for a balanced budget have been met. 16 For the year ended December 31, 2013 25,475;551 neelaill County Notes t0 Financial Statements 2. Compliance to Budget Requirements 26,188;569 Expenses Financial Plan Amortization Reclass Capital Fiscal Plan Per Legislative By-Law Allocation And Inventory Financial Stints. Actual Revenue Administration 1,911;229 48,034 Net taxes for municipal purposes 21,041,328 21,041,328 20,844,104 Government transfers 2,443,408 2,443;408 2;823,740 Interest and patronage dividends 232,000 232;000 324,013 Sales and user charges 662,775 662,775 833,518 Sales to governments and agencies 51,600 51,600 73,169 Drilling licenses 75;000 75;000 117,843 Fees, licenses, permits, fines 130,850 130,850 182,209 Rentals 54;100 54,100 69,815 Penalties and interest 65;000 65,000 65,406 Local government transfers 263,690 263,690 268,331 Local improvement charges 402,900 402,900 489;607 Gain on sale of assets - - - Other 52,900 52,900 126,814 Total revenue 25,475;551 25,475,551 26,188;569 Expenses Legislative 366,075 - 366,075 411,084 Administration 1,911;229 48,034 1,959,263 1,902,580 Assessment 384,944 - 384,944 419,013 Fire services and safety program 687,648 189;594 877,242 735,158 Enforcement 365;654 45;440 411,094 381,286 Disaster services 6;000 - 6,000 3;678 Transportation 11,006,134 3,158,933 (3,769,217) 10;395,850 9,906,165 Bridges 1,652,779 369,902 (1,004,703) 1,017,978 459,002 Water 1,314,582 819;648 (31,786) 2,102,444 2,244,004 Sewer 98;045 54,294 152,339 136,483 Waste disposal and recycling 473;156 10;880 484,036 521,289 Community support services 950,621 - 950,621 923;267 Health services and cemeteries 89,802 7;869 97,671 32,352 Planning 500,376 - 500,376 397,876 Agricultural services board 597;306 41,970 639,276 681,618 Parks, recreation; and culture 733,954 49,958 783,912 607,803 Loss on disposal of assets - - - 194,778 Other 201;243 201,243 194,734 Total expenses 21,339,548 4,796;522 (4,805,706) 21,330,364 20,152,168 Excess of revenue over expenses before other 4,136,003 (4,796;522) 4,805,706 4,145,187 6,036;401 17 Excess of revenue over expenses before other Other: Provincial capital transfers Federal capital transfers Local government capita transfers Contributed assets Transfers to local governments Other Excess of revenue over expenses Reconciling. Debenture debt Sale of assets Capital Inventory Contributed Assets Interfund transfers Debt repayment Kneehill County Financial Plan Amortization Aeclass Capital Fiscal Plan Per By Law Allocation And Inventory Financial Stints. Actual 4,136;003 (4,796,522) 4,805,706 4,145,187 6,036,461 2;200,000 2,200;000 2,393,524 38,836 (1,936) 6,336;003 (4,796;522) 4,805,706 6;345,187 8,466;825 506;000 506,000 878,884 (2,337,500) (4,396,661) (6,734,161) (6,774,086) (2,506,500) (409;045) (2;915,545) - - (38,836) 368,890 368,890 (5,210,849) (2,366,893) (2,366,893) (2,366,993) (4;796,522) (5,044,954) Add back non cash items: Amortization 4,796;522 Current year closure and post closure landfill 99,910 Loss on disposal of assets 194,778 Net Revenue over Expenses IM Kneehill County Notes For the year ended December 31, 2013 3. Caste and Temporary Investments 2013 2012 Cash 30,902,990 25,136,766 A line of credit of $2,500,000 is available to the County should the need arise ata floating rate of prime rate minus 0.75% Included in cash and temporary investments is $56,194 (2012- $628,194) received from the Province of Alberta restricted for future projects (Note 7). 4. Taxes Receivable Current taxes and grants in place of taxes Tax arrears and grants in place of taxes Less: Allowance for doubtful tax accounts 5. 'Trade and Other Accounts Receivable Provincial and Federal grants GST Receivable Trade and other Fal M 13,138 181,272 194,410 -76,242 2013 ($) 2012 ($) 250,882 139,097 389,979 -69,313 320,666 2012 ($) 714,288 179,484 630;675 1,524,447 For the year ended December 31, 2013 6. Other Assets Alberta Capital. Finance Shares„ at cost Servus Credit Union Membership Share, at cost e e 4 2013 2012 M () 121 121 1 1 122 122 7. Deferred Revenue 2013 2012 Federal Gas Tax Funds Municipal Sustainability initiative Canadian Badlands KCRP - Golden Hills School FOSS PLC Public Health - CBI 290,799 276,261 10 - 23,000 23,000 1,217 1,339 29,522 16,086 2,445 20,709 56,194 628,194 8. Employee Benefit Obligations 2013 2012 Accrued sick benefits 411,285 446,908 Accrued vacation 220,820 198,108 632,105 645,016 The vacation and sick benefits liability is comprised of vacation and sick days credits that employees are deferring to future years. Employees have either earned the benefits (and are vested) of are entitled to these benefits within the next budget year. NN For the year ended December 31, 2013 9. Provision rr Landfill Closureand Postelosure Costs Alberta environmental law requires closure and postclosure care of landfill sites, which includes final covering and landscaping, pumping of ground water and leachates from the site, and ongoing environmental monitoring, site inspections and maintenance. The estimated total liability is based on the sum of discounted future cash flows for closure and postclosure activities for 25 years after closure using a discount rate of 4:4% and assuming annual inflation of 3%. The accrued liability portion is based on the cumulative capacity used at year end compared to the estimated total landfill capacity. The total capacity of the site is estimated at 47,520 cubic metres. The existing landfill site is expected to reach capacity in (approximately) the year 2024. The County has not designated assets for settling closure and post closure liabilities: Estimated closure costs Estimated post -closure costs Estimated total liability Liability Accrued Balance of estimated cost to accrue 21 M 2012 272,000 323,000 323,000 595,000 (96,515) 498,485 For the year ended December 31, 2013 10. Long Term Debt 2013 2012 Total tax supported debentures 7;517,865 9,884,758 The current portion of long-term debt amounts to $2,448,343 (2012 - $2,366,894) Principle and interest repayment are as follows: Debenture debt is repayable to Alberta Capital Finance Authority: Debenture one, issued June 16;'2008, in the amount of $11 million, repayable semi annually at a fixed interest rate 4.3859%, maturing June 16, 2018. Debenture two, issued Junel5 2010, in the amount of $6.3 million, repayable semi annually at a fixed interest rate of 2.375%0, maturing June 15, 2015. Debenture debt is issued on the credit and security of Kneehill County at large. Interest on debenture debt amounted to $354,652 (2012 = $433;233) M Principal Interest Total 2014 2,448,343 273,222 2,721,565 2015 1,857,328 188,769 2,046,097 2016 1,243,230 127;400 1,370,630 2017 1,298,355 72,275' 1,370,630 2018 670,609 14,706 685,315 7,517,865 676,372 8,194,237 Debenture debt is repayable to Alberta Capital Finance Authority: Debenture one, issued June 16;'2008, in the amount of $11 million, repayable semi annually at a fixed interest rate 4.3859%, maturing June 16, 2018. Debenture two, issued Junel5 2010, in the amount of $6.3 million, repayable semi annually at a fixed interest rate of 2.375%0, maturing June 15, 2015. Debenture debt is issued on the credit and security of Kneehill County at large. Interest on debenture debt amounted to $354,652 (2012 = $433;233) M For the year ended December 31, 2013 11. Debt Limits Section 276(2) of the Municipal Government Act requites that debt and service on debt limits as defined by Alberta Regulation 255/00 for the County be disclosed as follows: Total debt limit Total debt Amount of debt limit unused Debt servicing limit Debt servicing Amount of debt servicing limit unused 2013 (5) 37,601,627 7,517,865 3,545,372 2012 (S) 37,199,724 9;884,758 27,314,966 6,199,954 2,721,566 3,478;388 The debt limit is calculated at 1.5 times the revenue of the Municipality (as defined in Alberta Regulation 255/00) and the debt service limit is calculated at 0.25 times such revenue. Incurring debt beyond these limitations requires approval by the Minister of Municipal Affairs. These thresholds are guidelines used by Alberta Municipal Affairs to identify municipalities that could be at finanical risk if further debt is acquired. The calculation alone does not represent the financial stability of the municipality. Rather, the financial statements must be interpreted as a whole, 12. Inventory For Consumption 2013 2012 Gravel Other transportation amounts Other 23 t�) 4,744,461 273,111 (S) 4,718,703 351,567 93;300 98,415 5,110,872 5;168,684 Kneehill County For the year ended December 31, 2013 13, Tangible Capital Assets 2013 2012 Net Book Value ($) Land 1,380,432 1,380;432 Land improvements 638,613 647,489 Buildings 6,124,591 6,273;418 Engineered Structures Water 46,803,871 46,927,831 Sewer 1,070,639 1,124;933 Towers 168,939 191,109 Dams 86,553 90,665 Transportation 0 0 Bridges 11,435,668 10,787,059 Roads 27,941,958 26;911,456 Machinery and equipment 5,293,074 5,406,235 Vehicles 4,741,937 5,002,912 105,686,275 104,743,538 14a Equity In Non Financial assets 2013 2012 ($) (S) Tangible capital assets Accumulated amortization Inventory of supplies Prepaid expenses Longterm debt MI 173,495,864 (68,752,325) 5,168,684 178,648 (9,884,758) 100,206,113 Kneehill County For the year ended December 31, 2013 15. Reserves Transfers Transfers 2012 In Out 2013 ORerating Deserves Lin $1 Contingency Information Technology Joint Community Summit Doctor Recruitment Fuel Stabilization Gravel Fancily & Community Support Services Kneehill Community Resource Program Parent Link Program Cemeteries Planning Parks Strat Plan Reserves Special Projects CaRital Reserves {in Si Capital Equipment Replacement Buildings Bridges Roads Water Water Service Area Sewer Environmental Recreation and Leisure Funding Medical 894,099 275,188 169,843 999,444 211,359 88,408 95,184 204;583 52,275 25,480 20,000 57;755 260,572 55,965 57;836 258,701 303,160 9,606 312,766 2,732,935 2,732,935 73,100 10,858 62,242 56,355 10,225 66,580 127 127 56,874 20,000 76,874 30,775 42,207 72,982 51,566 225,000 2,480 274,086 250;000 200,000 200,000 250;000 168;301 369,735 122,749 415,287 5,141;498 1,321,814 678,950 5,784,362 1,091,547 2,454,916 3,887,535 1;809;420 1,750;724 2,162,178 4;952,892 4,084,788 229,119 229,119 4,704,793 3,478;804 1;640,039 1,906,424 1,029;842 4,667,113 3,912,902 3,248,600 5,789,080 229,119 7;813;244 370,353 408,839 408,839 - 59,603 59,603 670,694 4,250,000 4,920,694 17;696,143 18,299;709 13,731,725 22,264,128 Total Reserves 22;837,641 19,621,523 14,410,675 28,048,490 25 For the year ended December 31, 2013 16. Accumulated Eauity Residual Equity Equity in Non Financial Assets (Note 14) Reserves (Note 15) Kneehill County Votes o a. i 2013 2012 1,244,293 1,220,470 103,438,266 100,206 113 28,048,490 22,837,641 132,731,049 124,264,224 17. Salary and Benefits Disclosure No. of Salary& Benefits & 2013 No. of 2012 Councillor/Division Persons Fees Allowances Total Persons Total Division 1 1 34,526 3,879 38,405 1 35,068 Division 1 27,567 3,579 31,746 1 30,721 Division 3 1 28,563 3,879 32,442 1 28;986 Division 4 1 28,620 3,879 32,499 1 30,178 Division 5 1 55,569 3;879 59,448 1 57;472 Division 6 1 29,733 3,929 33,662 1 31,486 Division 7 1 30,963 3,879 34,842 1 34,649 Chief Administrative Officer 1 143,141 22,763 165,904 1 260,995 Other Designated Officers 3 245,448 29,719 275,167 3 253,467 (1) Salary includes regular base pay, bonuses, overtime, lump sum payments, gross honoraria; and any other direct cash remuneration. (2) 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 term and short term disability plans, professional memberships and tuition. (3) Benefits and allowances includes the employer's share of travel, cell phone and car allowances. In 6. 1 For the year ended December 31, 2013 Local18. / PensionPlan Employees of Kneehill County participate in the Local Authorities Pension Plan (LAPP) which is administered in compliance with the Public Sector Pension Plans Act. The Plan is financed by employer and employee contributions and by investment earnings of the LAPP Fund.. Kneehill County is required to make current service contributions to the Plan of 10.43% of pensionable payroll up to the year's maximum pensionable earnings under the Canada Pension Plan (CPP) and 14.47% of pensionable earnings above this amount. Employees of the County are required to make current service contributions of 9.43% of pensionable salary up to the year's maximum salary and 13.47% on pensionable salary above this amount. Total employer contributions by Kneehill County to LAPP in 2013 were $385,264 ($354,943 is 2012). Total current contributions by the employees of Kneehill County to LAPP in 2013 were $351,829 ($322,413 in 2012). At December 31, 2012 the Plan disclosed an actuarial deficiency of $4.98 billion. 1 Contingent Liabilities (a) Kneehill County has been named in a law suit relating to a private company contractor and sub contractor for which the private company is seeking damages for, No provision has been made on the statement of financial position. It is the opinion of management that the County has minimal exposure to these actions or the potential liability will be fully recovered by insurance in place for such events. (b) The County is a member of Alberta Municipal Insurance Exchange (MUNIX). Under the terms of membership, Kneehill County could be liable for its proportionate share of any claim losses in excess of the funds held by the exchange.. ►X For the year ended December 31, 2013 20. Commitments (a) Kneehill County is part of a Master Fire Protection Agreement with the following Municipalities to provide fire protection services to rural residents in the County from 2012 to 2014 inclusive. The County's 2013 commitment is indexed by the cost of living index as established by the Province of Alberta for October of the previous calendar year: 2014 2013 Town of Three Hills 48,650 48,178 Town of Trochu 31,114 30,806 Village of Acme 39,941 39,545 Village of Carbon 39,941 39;545 Village of Linden 43,210 42,783 (b) Kneehill County has contracts for 2014 to provide peace officer and by-law enforcement services at a cost recovery for the following Municipalities: Town of Three Hills Village of Acme Village of Carbon Village of Linden Town Of Troelm (c) Kneehill County is the managing partner of the Aqua 7 Regional Water Services Commission. The current contract is for 3 years from April 1, 2013 to March 31 2016. The County will receive $21,855 in fees to provide support services to the Cormnission in the first year. (d) Kneehill County is a partnering member of the Drumheller and District Solid Waste Management Association. In 2013, Kneehill County paid requisition of $181,712 and is expected to pay $183,529 in 2014. e) Kneehill County entered into a 5 year contract for assessment services in 2013. The total financial commitment from 2014 to 2018 will be approximately $989,944. FM Kneehill County For December1 Information for !t General Situated in the heart of central Alberta, Kneehill County is a progressive rural municipality comprised of approximately 815,000 acresofland and 2,000 kilometers of developed roads. Agriculture remains the backbone of the local economy, complemented by a strong oil and gas industry. Kneehill County is first and foremost a rural community that values safety and good government for their citizens. Responsible development is encouraged that supports our resource-based economy, while at the same time investing in and enhancing infrastructure and services to citizens. Our municipality continues to promote environmental responsibility, prosperity; and positive relationships with citizens, private sector and government partners. A wide range of services are provided by departments and for management purposes, their operations and activities are organized and reported by fund. Certain departments that have been separately disclosed in the segmented information, along with the services they provide, are follows: Agriculture ,services The Agriculture Services Department focuses on the need to maintain agricultural production and profitability with an emphasis on helping farmers help themselves. It involves the participation of ratepayers and the cooperation of Alberta Agriculture Food and Rural Development. The key priorities and goals of the department are to advise landowners concerning proper land utilization with a view of improving their economic well being. Priorities include advising landowners of effective methods to control weeds, diseases; insects and predators along with the prevention of soil and water degradation. Corporate and Financial Services The Corporate and Financial Services Department focuses on the delivery of quality services to customers at a reasonable cost. Along with meeting all of the financial reporting requirements, this department is also instrumental in ensuring legislative requirements are met associated with assessment and taxation. Additional support services initiated by this department include GPS, Records management, Information Technology and Human Resources. The goal of the Corporate Services team is the delivery of customer service in a friendly, courteous and helpful manner guided by integrity and fairness. Protective Services Kneehill County's Protective Services Section includes that of both Fire Services and Enforcement (Peace Officer) Services. Fire Services provides emergency fire protection and preventative services that mitigate loss of life and property with professionally trained volunteers and modern response equipment. Kneehill County support operating contracts with each of the six urban fire departments in addition to major contributions emergency response vehicles. M Knechill County F , ,. : t c .a -f irr,rrrr■�rsrs: 21. Segmented Information for Annual Financial Reports (Continued) Emergency preparedness planning is also led by Kneehill County through the implementation of a regional with all urban centres within our boundaries; Kneehill County identified a need for protection of municipal infrastructure and the need to enhance public safety. Our Peace Officers enhance some services provided by local RCMP in addition to the protection of municipal infrastructure and enforcement of municipal bylaws. Enforcement assistance is also provided to other County departments such as Planning and Operations. Planning and Development The Planning and Development Department promotes the incorporation of progressive plamling and development practices into the organizations daily operations, along with orderly development and land use practices benefitting residents and minimizing conflicting uses. These practices centre around environmental stewardship, the notion of shared responsibilities in a global community, quality; livable communities and public participation. Recent initiatives of the department include the development of Inter -municipal Development Plans with neighboring municipalities, an Environmentally Significant Areas Assessment and an Integrated Community Sustainability Plan. Long-term planning is supported the Municipal Development Plan and Land Use Bylaw which reflect the vision and expectations of County residents. Operations The Operations Department oversees many responsibilities including that of construction, maintenance and dust control of roads. Kneehill County has over 200 bridge crossing sites that are also maintained by this department. The oil and gas sector along with the development of large feedlots and new grain elevators have had significant impacts on the growth of the County and the resulting effects on our transportation corridors. In addition to the rural transportation routes, the Operations Department also provides services in five major hamlets located within our boundaries. Environmental, Water, Wastewater Major infrastructure projects have taken place under the direction of Council in the area of potable water distribution. As a member of the Aqua 7 Regional Water Services Commission, the County has diligently worked to bring water to areas of the County where safe potable water is not available through the traditional well systems. Major completion of these distribution lines were completed in 2012. Other water distribution systems located throughout the County are also part of this operation. The wastewater needs of our local hamlets are also met by this department. As a member of the Drumheller and District Solid Waste Management Association, various transfer sites provide for the collection and disbursement of solid waste. UN Kneehill County Notes For the year ended December 21. Segmented Information for Annual Financial Reports Expansion to handle various recyclables at these stations along with initiatives in the areas of agricultural plastic recycling have also been facilitated through this relationship. Parks and Recreation Under the direction of the Operations Department, the County is responsible for the maintenance and operation of various municipal parks and campgrounds. Enhancements over the past several years have increased the level of services available at various locations. A Recreation Master Plan completed several years ago was the basis for the development of both major annual operating and capital contributions towards the various recreational facilities (arenas, swimming pools) located within our urban centres in Kneehill County. ,Social and Community Services Kneehill Regional FOSS is partnership between the Province and the six municipalities located within the boundaries of Kneehill County. An elected officials board sets the direction for the program and makes the funding decisions for preventative based programs. Other programs that are administered under the FOSS Director include the Kneehill Community Resource Program, Parent Link Program and Community Building Initiatives. Services provided care for and strengthen the quality of life for all citizens; through volunteering, consulting and providing services to meet needs where they exist. 22, Comparative Figures Some of the comparative figures have been reclassified to conform to the current year's presentation. 23. Approval of ..1 Cotimcil and Management have approved these financial statements. 31