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THE PRINCE EDWARD FITNESS & AQUATIC CENTER
FINANCIAL STATEMENTS
year ended
AUGUST 31, 2015
\:“\‘èich :
INDEPENI)ENT AUDITOR’S REPORT
To the directors of
THE PRINCE EDWARD FITNESS & AQUT1C CENTER
We have audited the accompanying financial statements of The Prince Edward Fitness & Aquatic Center which comprise
the statement of t inancial position as at August 31. W15. and thc statements of operations. changes: in net assets: and cash
tlows for the year then ended and a summary of significant accounting policies and other explanatory information.
Nianagement’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements tn accordance with Canadian
accounting standards for not-forprofit 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.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conduL ted our audit in
accordance with Canadian generally accepted auditing standards Those standards requue that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of
matcrial 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 ordcr to design
audit procedures that are ippropriate in the circumstances but not tor the purpose of expressing an opinion on the
ettectivcness of tht. entitvs internal u ntrol An audit also includes etaluating the ippropnatcness of accounting policies used
‘rid the ieasonahlcness ( t ictounting estimates madt hs man igement as eli is csaluating the ncrall presentation nt ik..
financial statement.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis fbr our audit opinion.
f)pinion
In our opinion thc fin incial statements present fairl\ in dl material respects the finanial position ot The Prince Edward
I’ itniss & quatic ( enter is i \out I Dii i s d it t It’, )t t\ i trailur’s i I N .. oh tti s F s ir ihc. ci dcii
in accordant:c with Ciiuadian acc unting standards Ow ncii tor-profit cirganizatit)1k5.
( H\RTEPEDPROFTSsIfl’s\I \C(()t NI \‘\lSLICENSED PUBLIC A(:COf:!TANiTs
Picun. ( )ntarioI)cccmhcr 4, 2015
THE PRINCE EDWARD FITNESS & AQUATIC CENTER
(Incorporated under the laws of Canada)
STATEMENT OF FINANCIAL POSITION
AUGUST 31, 2015
ASSETS201L.
$ 106,8017,4794,00345I
_I 18234
2013
CAPITAL ASSETS - note 3 6I232 6i239
$ i8h9ffi $ 62,917
LIABILITIES AND NET ASSETS
CURRENT LIABILITIESAccounts payable and accrued liabilitiesDue to governmentsDeferred membership revenueDeferred government assistance - note 5
$ 26,9954,2576,977
20AXX58229
$ 24,5707,0139,127
1933360O43
DEFERIED CAPITAL CONTRIBUTIONS note 6 4464Q102869
38,40()98,4I
NET ASSETSInvested in capital assets - internally restrictedUnrestricted
18,59260i0579097
24,839
64,474
I) r
$ J8L9
Director
$ l62911
(i RRENT SSE I’S(‘i’h\CCOUfltS receivableGovernment assistance receivablePrepaid expenses
$
THE PRINCE EDWARD FITNESS & AQUATIC CENTER
STATEMENT OF OPERATIONS
‘tEAR ENDET) AUGUST 31, 2015
2014
REVENUEMembershipsMembership insuranceProgram fees and facility rentalsDay use passesGovernment assistance note 8Fundraising and donationsPro shop salesAmortization of deferred capital contributions
$ 325,6033,886
1 33,7306811
67,36315,5336,377
l&760578J)63
$ 324,7823,510
I 12,7377372
115,62714,9226,587
I 776()— 603,297
EXPENSESAdministrative wages and employee benefitsAdvertising and promotionAmortizationFund raisingInsuranceInterest and bank chargesMaintenanceOfficePool suppliesPro shop purchasesProfessional feesProgram costsRentTelephoneTravelUtilities
109,98824,66225,031
6,19610,0394,155
51,4623,2923,4863,2775,200
149,66285,5262,5482,138
76,778563440
98,03813.38824,5544,009
13,8784,180
94.9143,2257,4795,0674,000
153,74385 ,87)
2,5282.3X)
71.028- 588,299
EXCESS OF REVENUE OVER EXPENSES $ 14,998
TIlE PRINCE EDWRD FITNESS & QUA FlU UENTER
ST TEMENT OF CHANGES IN ET SSETS
YEAR ENDED AUGUST 31, 2015
In\ested in(‘apital \ssets [nrestrictci
I3alance. heginning of ear ‘S 2439 ‘S N,376
Excess of ieemie owr eenses
Change in in\estment in capitalassets note 7
Balance, end of )ear ‘S I ,592 ‘S 60,505 ‘S 79,097 S 63,373
[TIE PRINCE EDWARD FITNESS & AQUATIC CENTER
ST:’[ENI ENT OF CASH FIOWS
YEAR ENDED AUGUST 31, 2015
2015 2014
CASH FLOWS FROM OPERATING ACTIVITIESExcess 01 revenue over expenses $ 14,623 14998
Adjustments for:Amortization 25,03 1 23554Amortization of deferred capital contributions ( I 8360) ( I 7360)
20,894 21,792Changes in non-cash working capital components:
Accounts receivable 3, 1 93 (6,397)1n\ entory I 75Prepaids -
Accounts payable and accrued liabilities 5,969I)ue to governments I ,4641)eferred membership revenue 2,92 1Deferred grant revenue (3,000)Deferred government assistance 667 (667)
Cash flows from operating activities 21,822 22,257
CASH FLOWS FROM INVESTING ACTIVITIESCapital contributions received 25,000 -
Purchase of equipment (25,024) (7,384)Cash flows from investing activities (24) (7,384)
INCREASE IN CASH 21,798 14,873
CASH, beginning of year 85,003 70.130
CASH, end of year $ 106,801 $ 85,003
THE PRINCE EDWARD FITNESS & AQUATIC CENTER
NOTES TO THE FINANGAL STATEMENTS
YEAR ENDED AUGUST 31, 2015
PURPOSE OF THE ORGANIZATION
The Prince Edward Fitness & Aquatic Center was incorporated July 25. 2006 as a not-for-profit corporation under thelaws of Canada and was continued under the Canada Not-for-Profit-Corporations Act on February 2 1 . 2014. It is notsubject to income taxes. Its purpose is to provide facilities and programs to encourage fitness and healthy activities forthe residents of Prince Edward County.
2. SIGNIFICANT ACCOUNTING POLICIES
These financial statements have been prepared in accordance with Canadian accounting standards for not-for-profitorganizations and include the following significant accounting policies.
Financial instruments
The organization initially measures its financial assets and financial liabilities at fair value adjusted by transactioncosts in the case where a financial asset or liability is subsequently measured at amortized cost.
The organization subsequently measures all of its financial assets and liabilities at amortized cost,
Financial assets measured at amortized cost include cash and accounts receivable.
Financial liabilities measured at amortized cost include accounts payable and accrued liabilities.
Use of estimates
The preparation of financial statements in conformity with generally accepted accounting principles requiresmanagement to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosureof contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues andexpenses during the reporting period. Estimates and underlying assumptions are reviewed on an ongoing basis,Management makes accounting estimates when determining the collectibility of accounts receivable and the estimateduseful lives of the organizations capital and intangible assets. Actual results could differ from these estimates.
Revenue recognition
The Prince Edward Fitness & Aquatic Center follows the deferral method of accounting for grants and donationsRestricted grants and donations are recognized as revenues in the year in which the related expenses are incurredFundraising and donations are recognized when received or receivable if the amount can be reasonably estimated andcollection is reasonably assured. Unrestricted grants, if for a specific period, are recognized on a pro-rata basis overthe period. Otherwise, they are recognized on a basis similar to that for fundraising and donations.
Membership fees are recognized as revenue for the months to which they apply.
Membership insurance. program fees, day use passes and pro shop sales are recognized as revenue when service isprovided, or when goods are transferred to the customer.
THE PRINCE EDWARD FITNESS & AQUATIC CENTER
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED AUGUST 31, 2015
2. SIGNIFWANT ACCOUNTING POLICIES (continued)
Contributed materials and services
Contributed materials are recognized in the financial statements when a fair value can be reasonably estimated, when
the materials are used in the normal course of operations, and when they would otherwise have been purchased.Contributed services are not recognized due to the difficulty in valuing services.
Capital assets
Tangible assets are stated at acquisition cost Amortization is provided on a straight line basis over the following
periods:
Computer hardware -5 yearsFitness equipment, furniture and fixtures -5 yearsLeasehold improvements -5 years
In the year of acquisition, amortization is provided at onehalf of the full annual rates.
Intangible assets are stated at acquisition cost. Amortization on computer software is provided on a straight line basis
over a two year period.
3. FINANCIAL INSTRUMENTS
The organization is exposed to various risks through its financial instruments. The following analysis provides ameasure of the organization’s exposure and concentration of risks.
Credit Risk
The organization is exposed to credit risk resulting from the possibility that parties may default on their financialobligations,or if there is a concentration of transactions carried out with the same party, or if there is a concentration offinancial obligations which have similar economic characteristics that could be similarly affected by changes ineconomic conditions, such that the organization could incur a financial loss.
The organization s receivables consist of sponsorships billed corporate membership child program fees and amountsdue from the federal government for summer jobs programs. There is no significant exposure to credit risk and noallowance for impairment has been provided.
Market Risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changesin market prices. Market risk is comprised of currency risk. interest rate risk and other price risk. Interest rate risk
refers to the risk that the fair value of future cash flows associated with the Financial instrument will fluctuate due to
changes in market interest rates whIle other price risk refers to similar fluctuations because of market price changesother than those arising from currency risk or interest rate risk. The organization does not have financial instrumentswhich would expose it to market risks.
Liquidity Risk
Liquidity risk is the risk that the organization cannot meet its debts when they become due The organization smanagement manages this risk by reviewing its expected future cash flow requirements and by holding cash reserves.
6
1 lIE PRINCE EDWARD FITNESS & AQUA tIC UENTER
3. FIN.NCI.L INSTRUMENTS (nhimied)
Changes in Risk
There have been no changes in the organizatioWs risk exposure from the prior year.
4. CAPITAL ASSE tS
Capital assets consist of the following:
2015
Accumulated
Tangible assets:Computer equipmentFitness equipmentFurniture and fixturesLeasehold improvements
Intangible assets:Computer software
21 L209
3,577$ 214,786
$ -
3,8405,907
53A92
63239
$ 6323
5. DEFERRED GOVERNMENT ASSISTANCE
Deferred government assistance represents unspent resources received in the current or prior periods that are related toa subsequent period. Amounts recorded as deferred are equal to one third of the operating grants received from theCounty of Prince Edward.
6 DEFERRED CAPITAL CONTRIBUTIONS
Deferred capital contributions reported include the unamortized portions of restricted contributions received fromgovernments with which fitness equipment or leasehold improvements were originally acquired The amountsreceived for capital improvements have been added to deferred capital contributions on the statement of financialposition and are amortized to income at the same rate as the capital assets acquired are amortized.
The changes for the year in the deferred contributions balance reported are as follows:
Beginning balanceRestricted grant contributionsAmounts amortized to revenue
$ 56,160
YEAR ENI)FI) :tTGUST 31, 2015
AmortizationCost
$ 2,61990,59912,882
jQ5Jj;9
$ 1,67068,408
8,45269A47
$ 94922,1914,430j6
147,977 63,232
3,577 -
$ 151,554 $ 63,232
Ending balance
THE PRINCE EDWARD FITNESS & AQUATIC CENTER
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED AUGUST 31, 2015
7. CHANGE IN INVESTMENT IN CAPITAL ASSETS
$__ Jñ247) S 590
8. GOVERNMENT ASSISTANCE
During the year, the organization received funding under the following government programs which was reported in
revenues:
2014
Ministry of Training, Colleges and Universities - Job Connect Program $ - $ 120
Government of Canada - Canada Summer Jobs Program 5,204 4,634
Government of Canada - META Employment Services 2,826 3,506
Ontario Trillium Foundation - 28,700
Prince Edward County - Operating Grant 59,333 58,667Prince Edward County Capital Grant 20 000
$ 67.36a $ 115.627
‘I’he portion ot the current year operating grant ot $40,00() I½oin Prince Edward ( ounty related to the current list a
year plus $19,333 deferred in the prior year has heen included in current year grant income.
9. COMMITMENTS
I he c ‘rganiiat ion mis a lease e xpirinu Atigiisi I “() ‘4 Ihr the use of ihe bin kline. I he reqtiii ed nu)iithly ti’v nent‘s625( ) iIs [IS I tint I I i\tigtisi I . 2( ) I 6 \n mci ease. at an iiiideierTuined a un out I I I he appi ied to i he 20 1 6/ 1 7 1ei—
year. I he organization is also iesonsihIe for Oie pay nient of oroperty taxes. I he lessor has allowed a credit ut $9.0( H)
(2014 $9.000) for space wHited by it during the year.
Capital assets acquired
Add (deduct):AmortizationAmortization of deferred capital contributionsCapital grants received from municipality
Capital grant received from others
S 25,024 $ 7.384
(25.031)I 8.760
( 20,000)(5.0(X))
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