AD-01-18 Resolution AGM 01-2018-06
SOUTHWESTERN INTEGRATED FIBRE TECHNOLOGY INC.
FINANCIAL STATEMENTS
DECEMBER 31, 2016
SOUTHWESTERN INTEGRATED FIBRE TECHNOLOGY INC. SOUTHWESTERN INTEGRATED FIBRE TECHNOLOGY INC.
DECEMBER 31, 2016
CONTENTS
- Management's Responsibility for the Financial Statements
- Independent Auditor's Report
- Statement of Financial Position
- Statement of Operations
- Statement of Change in Net Financial Assets
- Statement of Cash Flow
MANAGEMENT'S RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The accompanying financial statements of the Southwestern Integrated Fibre Technology Inc. (the "Organization") are the responsibility of the Organization's management and have been prepared in accordance with Canadian public sector accounting standards established by the Public Sector Accounting Board of the Chartered Professional Accountants of Canada, as described in Note 1 to the 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 Organization's management maintains a system of internal controls designed to provide reasonable assurance that assets are safeguarded, transactions are properly authorized and recorded (in accordance with Canadian public sector accounting standards established by the Public Sector Accounting Board of the Chartered Professional Accountants of Canada), and reliable financial information is available on a timely basis for preparation of the financial statements. These systems are monitored and evaluated by management. The Board of Directors meet with management and the external auditor to review the financial statements and discuss any significant financial reporting or internal control matters prior to their approval of the financial statements.
The financial statements have been audited by Collins Barrow SGB LLP, independent external auditor appointed by the Organization. The accompanying Independent Auditor's Report outlines their responsibilities, the scope of their examination and their opinion on the Organization's financial statements.
Chief Executive Officer December 8, 2017
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors and Members of Southwestern Integrated Fibre Technology Inc.
Report on the Financial Statements
We have audited the accompanying financial statements of Southwestern Integrated Fibre Technology Inc., which comprise the statement of financial position as at December 31, 2016, and the statements of operations, change in net financial assets and cash flow for the year then ended, and a summary of significant accounting policies and other explanatory information.
STATEMENT OF FINANCIAL POSITION
AS AT DECEMBER 31
| 2016 | 2015 | |
|---|---|---|
| $ | $(Unaudited)(Note 2) | |
| Financial assets | ||
| Accounts receivable from members | 2,560,811 | - |
| Due from Western Ontario Wardens' Caucus | 58,909 | - |
| HST recoverable | 6,738 | - |
| Government grants receivable(Note 7) | 168,000 | - |
| 2,794,458 | - | |
| Liabilities | ||
| Accounts payable and accruals | 161,491 | - |
| Due to Western Ontario Wardens' Caucus | - | 71,697 |
| 161,491 | 71,697 | |
| Net financial assets(net debt)å’Œaccumulated surplus(deficit)(Note 4) | 2,632,967 | (71,697) |
Approved
Chair
March 3, 2018
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2016
(with comparatoAecember 31, 2015)
| Budget 2016 | Actual 2016 | Actual 2015 | |
|---|---|---|---|
| $ (Note8) | $ | $ (Unaudited)(Note2) | |
| Revenues | |||
| Contributions from members(Note6) | 510,000 | 2,975,811 | 768,000 |
| Government grants(Note7) | - | 168,000 | - |
| 510,000 | 3,143,811 | 768,000 | |
| Expenses(Note5) | |||
| Consulting | 510,000 | 308,173 | 827,842 |
| Marketing | - | 5,306 | 966 |
| Miscellaneous | - | 6,525 | - |
| Office expense | - | 204 | - |
| Professional fees | - | 27,658 | - |
| Salaries and wages | - | 65,441 | - |
| Travel | - | 25,840 | 10,889 |
| 510,000 | 439,147 | 839,697 | |
| Annual surplus(deficit) | - | 2,704,664 | (71,697) |
| Accumulated(deficit)surplus,beginning of year | (71,697) | - | |
| Accumulated surplus(deficit),end of year(Note4) | - | 2,632,967 | (71,697) |
STATEMENT OF CHANGE IN NET FINANCIAL ASSETS
FOR THE YEAR ENDED DECEMBER 31, 2016
(with comparatoAecember 31, 2015)
| Budget 2016 | Actual 2016 | Actual 2015 | |
|---|---|---|---|
| $ (Note 8) | $ | $ (Unaudited)(Note 2) | |
| Annual surplus(deficit) | - | 2,704,664 | (71,697) |
| Change in net financial assets(net debt) | - | 2,704,664 | (71,697) |
| Net debt, beginning of year | (71,697) | - | |
| Net financial assets(net debt), end of year | 2,632,967 | (71,697) |
STATEMENT OF CASH FLOW
FOR THE YEAR ENDED DECEMBER 31, 2016
(with comparatoAecember 31, 2015)
| 2016 | 2015 | |
|---|---|---|
| $ | $(Unaudited) | |
| (Note 2) | ||
| Cash flows from (for): | ||
| Operating activities | ||
| Annual surplus (deficit) | 2,704,664 | (71,697) |
| Changes in: | ||
| Accounts receivable from members | (2,560,811) | - |
| HST recoverable | (6,738) | - |
| Government grants receivable | (168,000) | - |
| Accounts payable and accruals | 161,491 | - |
| Net change in cash from operations | 130,606 | (71,697) |
| Financing activities | ||
| Due to(from) Western Ontario Wardens' Caucus | (130,606) | 71,697 |
| Net change in cash position | - | - |
| Cash and cash equivalents, beginning of year | - | - |
| Cash and cash equivalents, end of year | - | - |
NOTES TO THE FINANCIAL STATEMENTS
AS AT DECEMBER 31, 2016
Nature of operations
Southwestern Integrated Fibre Technology Inc. ("the Organization") is a government not-for-profit organization incorporated without share capital under the Canada Not-for-profit Corporations Act on October 19, 2015. The corporation was formed by the Western Ontario Wardens' Caucus (WOWC) on behalf of WOWC, Region of Waterloo, Region of Niagara, Town of Caledon and the separated cities in the project area. Members include municipalities, first nations, schools, health care providers and community networks. The purpose of the Organization is to bring high speed broadband internet to the South Western Ontario region.
Summary of significant accounting policies
(d) Use of estimates
The preparation of the financial statements in conformity with Canadian public sector accounting standards 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 revenues and expenses during the year. Actual results could differ from those estimates.
(e) Tangible capital assets
(i) Network infrastructure
The Organization retains ownership of 51% of the funded network assets of the network construction project; however, all repairs and maintenance and upgrade costs are the responsibility of the service providers contracted to provide the network infrastructure. Since the Organization does not retain operational control over the network infrastructure, they have not been recorded as tangible capital assets but have been reported as an expense on the statement of operations.
(ii) Other
The Organization does not have any other tangible capital assets.
Accumulated surplus (deficit)
The accumulated surplus consists of individual fund surplus as follows:
| 2016 | 2015 | |
|---|---|---|
| $ | $ (Unaudited) (Note 2) | |
| Surplus(deficit): Member contributions towards high speed broadband internet project | 2,632,967 | (71,697) |
| Accumulated surplus(deficit) | 2,632,967 | (71,697) |
Related party transactions
Included in expenses is $56,889 paid to the The Corporation of the County of Grey for wage and benefit costs incurred to administer the Organization from January 1, 2016 to December 22, 2016.
Contributions from members
Also included in expenses is $8,460 paid to the The Corporation of the County of Lambton for wage and benefits costs incurred to administer the Organization from December 12, 2016 to December 31, 2016.
Members have agreed to contribute $12,804,050 over the period beginning in fiscal year 2016 and ending December 31, 2019. As of December 31, 2016 $3,743,811 was billed and recognized as revenue. The remaining revenue will be recognized as billed in future periods.
Government grants
The operating budget approved by the Board of Directors for 2016 is reflected on the statements of operations and change in net assets and was not audited. Budget figures have been reclassified for the purposes of these financial statements to comply with PSAB reporting requirements.