new inspiring people, ideas and investment - edgsj · 2019. 1. 29. · innovators, the private...

Inspiring people, ideas and investmentENTERPRISE SAINT JOHN

2016 ANNUAL REPORT

Grand Bay-Westf ield Quispamsis Rothesay St. Martins Saint John

enterprisesj.com@enterprisesj

[email protected]

12016 Annual Report

2 ........Letter from the Chair

3 ........Who is Enterprise Saint John?

4 ........Strategic Partners

4 .......Strategic Partner Investors

5 ........Building on Connections: Canada’s Most Connected Community

6 ........2016: Smart & Connected Community Data Strategy

7 ........Energy Sector: Ongoing Efforts

8 ........Internal Growth: Potential Entrepreneurs

9 ........Internal Growth: Start-ups and Existing Entrepreneurs

9 .......SEED Loan Program:

9 .......Vennture Garage

10 ......Internal Growth: Innovating with High Potential Businesses Catalyst Innovation Program

11 .......Growth from Outside: External Investors

11 .....Investment Attraction

11 .....Invest Canada-Community Initiatives (ICCI)

11 .....Spruce Lake Industrial Barge

12 .....Communications

12 .....Looking to the Future: Canada’s Most Connected Community

14 ......Who We Are

14 .....Enterprise Saint John – Board

14 .....Enterprise Saint John – Staff

15 ......Financial Statements

Contents

2 Enterprise Saint John

enterprisesj.com @enterprisesj

Letter from the Chair /

It was a challenging and at times, a rocky road in 2016. I have been the volunteer Chair of the ESJ board for more than two years and my term was originally scheduled to end December 31, 2016. I was asked to stay on while ESJ’s mandate, funding and key performance indicators were under review by the Regional Oversight Committee (ROC). The ROC is made up of the five regional mayors and two private sector representatives who are tasked with working with ESJ’s board to come up with the annual key performance indicators.

Upon the successful outcome of that review, I am pleased to say, the ROC expressed its full confidence in Enterprise Saint John’s work plan and direction to grow our economy through 2017. I felt it was a good time to end my tenure as Chair of Enterprise Saint John and introduce some new energy to the position. On April 5th, 2017, I was pleased to introduce Martin Chiasson as interim board chair. Martin is very engaged on our board and in the community and I know he will have lots of support in this important role.

Over the past two years, our board has identified a strategic path to economic growth for the Saint John region that included; leveraging collaborative partnerships, greater focus on helping local business and exploring new economic opportunities in Energy, Health Research at Tucker Park and Big Data. This strategy will help us deliver on the results our citizens and our partners expect.

In 2017, we will continue to position our region as Canada’s Most Connected Community. We are closely connected through a strong foundation of companies involved in innovation and technology. We have a strong and collaborative and easily accessible network of partners with a skilled workforce that makes this smaller community more attractive than bigger cities. The recent announcement of the Smart & Connected Community Data Strategy will move this overall vision forward for the next 3 years. We encourage you to learn more about the data strategy on the following pages and on our website, www.enterprisesj.com.

I would like to take this opportunity to personally thank our talented and dedicated staff, our wonderful board volunteers and the community that I love for the opportunity to serve.

Yours sincerely,

Larry Hachey

32016 Annual Report

Enterprise Saint John (ESJ) is the community’s regional economic development agency serving the five regional municipalities of Grand Bay-Westfield, Rothesay, Quispamsis, St. Martins and Saint John. The ESJ board and staff works closely with the Regional Oversight Committee (ROC), made up of the five regional mayors and two private sector representatives to come up with the annual key performance indicators that are focused on job growth.

The majority of our region’s economic growth (80%) comes from within, while the rest (20%) comes from external businesses locating or expanding in the region. That’s why many of ESJ’s programs and initiatives focus on developing potential entrepreneurs, supporting new startups and helping existing businesses grow, while encouraging external businesses to choose our region to locate, expand and create jobs. We have also worked with our key partner, Opportunities New Brunswick, to develop a Memorandum of Understanding to solidify our partnership, leverage our collective strengths and avoid duplication of our efforts.

Our vision is to become Canada’s Most Connected Community by emphasizing the close connections we have in our community that make our technology, our people and our strategic location attractive to businesses and people inside and outside of our region.

In the last few years, we have further developed the cross-sector model of collaboration, we began under the True Growth model to draw in researchers, innovators, the private sector and educational institutions to help set the groundwork for Enterprise Saint John’s Smart & Connected Community Data Strategy, which rolls out in 2017. Over the next three years, a data repository will be built where researchers can get access to data sets can get access to data sets and information from industry, business and the tourism sector to improve everything business efficiency, and citizen services to social issues. Sensors and beacons will also be set up around the city and in businesses to collect more data to be analyzed by researchers and innovators. Long-term, if applications or solutions to business and community problems are developed, they could be marketed to the world. The repository could be an appealing asset, used to attract outside businesses and innovators to our region. The hope is that momentum in this sector will continue to build long after the pilot projects have ended.

At the same time, we will continue connecting companies and major industrial players, with investment, talent, and ideas they need to solve critical business challenges. We know this kind of support will allow our major industries, large and small businesses to be more competitive and support the growth of new business.

Who Is Enterprise Saint John? /



Strategic Partners /

Our work at Enterprise Saint John would not be possible without financial investments from our strategic partners. Our funding comes from the five regional municipalities as well as our strategic partners. Through these core funding commitments, we are able to leverage an additional $1.2 million in project funding for specific programs.

Municipalities:City of Saint John: $475,000

Town of Quispamsis: $112,000

Town of Rothesay: $86,500

Town of Grand Bay-Westfield: $25,000

Village of St. Martins: $1,500

Strategic Partner Investors:

Tier 1: $20,000-$25,000

Bell Aliant

Irving Oil Limited

Commercial Properties Limited

J.D. Irving, Limited

Emera

Saint John Energy

Revolution Strategy

Tier 2: $10,000-$15,000

Canaport LNG

Innovatia

Lorneville Mechanical Contractors Ltd.

Saint John Construction Association

Saint John Mechanical Contractors Association

Delta Brunswick/Slate Asset Management

Tier 3: $1,000-$5,000

Bird Construction

Cox & Palmer

East Point Inc.

Owens MacFadyen Group

Scotiabank

Stewart McKelvey

Tabufile

52016 Annual Report

Building on Connections: Canada’s Most Connected Community /

In our vision to make the Saint John region Canada’s Most Connected Community, we remain committed to a model of collective impact and collaboration with our partners to achieve common goals.

Our Workplan Partners are:

Anglophone South School District

Atlantic Canada Opportunities Agency

Atlantica Centre for Energy

Association Régionale de la Communauté francophone

Atlantic Coastal Action Program

Bassadur Applied Creativity

Bell Aliant

BioNB

Canadian Manufacturers & Exporters

Canaport LNG

Cisco

Collège Communautaire du Nouveau Brunswick

ConnexionWorks

Cox & Palmer

Donna Mazerolle & Associates

Grant Thornton

Regional Economic Development Corporation

Ignite Fredericton

Invest Canada Communities Initiatives

Innovatia

Global Affairs Canada

City of Saint John

Discover Saint John

EY

Health and Life Sciences NB

New Brunswick Community College

New Brunswick Business Council

New Brunswick Jobs Board

University of New Brunswick

Opportunities New Brunswick

Pond-Deshpande Centre

Post-Secondary Education, Training & Labour

Port Saint John

Propel ICT

Regional Development Corporation

Revolution Strategy

Saint John Airport

Saint John Community Loan Fund

Saint John Development Corporation

Saint John Energy

Saint John Hotel Association

Saint John Industrial Parks

Saint John Region Chamber of Commerce

Saint John Telegraph Journal

Shad Valley

Start-Up Weekend

3+ Corporation

T4G

Tech Impact

Town of Grand Bay-Westfield

Town of Rothesay

Town of Quispamsis

Uptown Saint John

Venn Innovations

Village of St. Martins



2016: SMART & CONNECTED COMMUNITY DATA STRATEGY

In 2016, we looked at how data collected through sensors and cameras and devices connected to the internet (Internet of Things, Industrial Internet of Things) could transform how businesses perform and how people visit, live, work and play in our region.

Businesses will be the leading adopters of IoT as they look to lower operating costs, increase productivity, expand to new markets or develop new products. There are tremendous opportunities we can capitalize upon in the Saint John region because of the world-class energy-concentrated industrial players we have as well as the advanced ICT infrastructure and innovative tech companies that exist here in the heart of uptown Saint John. There is a cluster of 34 ICT companies

in our Heritage Knowledge Park. It’s also known as Brick Park because many of the businesses are housed in sandstone, bricks-and-beam architecture. These heritage office spaces are walking distance from marketing, law and accounting firms, architects, as well as art galleries, nationally-recognized restaurants, nightlife and luxury condos. These are all factors that are extremely attractive to outside businesses in this sector looking to expand.

A 3-year Smart & Connected Community Data Strategy was developed with partners in the IT sector (Bell Aliant, T4G, EY), Education (UNB), Tourism (Discover Saint John, Saint John Hotel Association) Port Saint John and municipalities (City of Saint John).

72016 Annual Report

TARGETS ACTUAL

New Job Targets:

Investment Attraction 300 299

Existing Business 1000 620

New Payroll $11,000,000 $21,665,000

R & D Expenditures $1,500,000 $4,133,000

Impacts on Problems Solved $10,000,000 $10,060,000

New Business 25 24

KPIs and Outcomes 2016

ENERGY SECTOR: ONGOING EFFORTS

The work on the Energy Sector file continued in 2016 by bringing partners together and leveraging project funds to ensure this sector remains a priority.

Enterprise Saint John is a key partner in the Energy East Partners’ Forum, which has been in a holding pattern, but partners continue to share information, align activities, seek advice and collaborate, to ensure potential projects are maximized for the Saint John region.

Our Metrics

Understanding that 80% of our economic growth comes from within, while the 20% comes from external businesses locating or expanding in the region, many of ESJ’s programs and initiatives are geared towards developing potential entrepreneurs, startups and existing entrepreneurs, innovating with existing businesses and encouraging external businesses to expand or grow here.

Through our programming and connections, we focused on:

1. Promoting and leveraging our technology, our people and our strategic location to global markets through Canada’s Most Connected Community Strategy.

2. Developing emerging and existing entrepreneurs

3. Developing problem solvers and innovators and connected them to companies to solve corporate challenges, increase competitiveness and encourage innovation

4. Continuing to help companies have access to a pool of skilled talent



INTERNAL GROWTH: POTENTIAL ENTREPRENEURS

Enterprise Saint John’s Emerging Entrepreneurs Program has been supporting and inspiring young entrepreneurs across the region for 13 years. In 2016, we continued to focus on incorporating problem-solving and innovation to the program. It teaches entrepreneurial skills to students by supporting them to come up with a business concept. They create a business and marketing plan to go along with that concept and then try to sell that product or service to their peers at high school markets around the region. ESJ also helps students learn coding and other ICT skills with clubs and initiatives.

2016 Results:

• 1,918 young people participated in the Emerging Entrepreneurs Program, including “Run Your Business for a Day,” “Idea to Action,” and “Youth PreLoaded”

• 317 students from 3 high schools sold their products and services at campus markets

• 103 high school students learned coding and entrepreneurial skills through the Youth PreLoaded program

Emerging Entrepreneurs:

92016 Annual Report

INTERNAL GROWTH: START-UPS AND EXISTING ENTREPRENEURS

Enterprise Saint John works to support entrepreneurs and potential new businesses through a variety of programs that target different stages of the start-up process. These programs are designed to help people turn ideas into solid business plans, and to leverage funding and gain acceptance to accelerators to grow their business and create jobs.

SEED Loan Program:

The SEED Loan program is managed by ESJ. It helps entrepreneurs access a loan of up to $20,000 on a 5-year term for the development of a new business. The loan is offered at the interest rate of 2% + prime. Often, SEED Loan recipients go on to leverage other funding as a result of this initial loan.

2016 Results

• 18 loans were distributed totaling $360,000

• Clients used the loans to leverage $356,750 in additional investment

• 58 clients participated in training sessions

• Enterprise Saint John conducted 115 business counseling sessions

• 24 full-time jobs were created

Vennture Garage

The Vennture Garage program uses its resources for the development of entrepreneurs and their start-ups including business skills development, coaching, and networking opportunities. Vennture Garage participants work through four (4) program stages: idea validation, development, testing, and pre-launch. The expectation is that participants will move through the program framework, apply to accelerators, and seek capital investment for the development of their start-up.

2016 Results

• 24 clients representing 18 companies participated in the program

• 5 clients were accepted into accelerator programs

• 18 start-ups were already generating revenue by the end of 2016

• Clients leveraged $490,000 in additional investment

Knuckledown Studios Canvas & Cocktails



INTERNAL GROWTH: INNOVATING WITH HIGH POTENTIAL BUSINESSES

The Catalyst Innovation Program, was launched as a pilot project in 2015 in an effort to overcome business problems in creative and innovative ways. It’s the only programming of its kind in the province. The problem-solving process has been picked up by companies and organization of all sizes across New Brunswick including J.D. Irving, Limited, Moosehead Breweries, Dalhousie Medical and Intelisys. The Catalyst Innovation Program is based on the knowledge that creativity can be taught, and that innovation can be a practical process that drives tangible business results.

Enterprise Saint John led participants through creative problem-solving workshops based on the renowned Basadur Simplexity methodology.

2016 Results:

• 26 companies participated in innovation training

• 10 innovation projects were undertaken

• 10 people certified in Simplexity Thinking

• 440 people trained in innovation skills

Some of the companies that have participated in the Catalyst Innovation Program since 2015:

112016 Annual Report

GROWTH FROM OUTSIDE: EXTERNAL INVESTORS

Investment Attraction

In 2016, we solidified our Memorandum of Understanding with Opportunities New Brunswick and continued to work with the province’s investment attraction team. Our efforts included hosting site visits, visiting companies in other markets, trade shows, answering requests for information, and following up on leads.

2016 Results:

• 299 full-time jobs were added to the community as a direct result of our investment attraction efforts

• $21.6 million in annual payroll was added

• 153 leads were generated & pursued

• Hosted 5 site visits

• Secured funding for a 2-year business development initiative in advanced manufacturing

Invest Canada-Community Initiatives (ICCI)

Every year, the federal government allows communities to apply for 50% matching funding for investment attraction projects. In 2016, we embarked on a major ICCI-funded initiative to promote advanced manufacturing, fabrication, assembly, petrochemical and energy in Saint John region.

2016 Results:

• Creation of marketing and promotional collateral to promote the Saint John region as a hub for advanced manufacturing, fabrication, assembly, petrochemicals and

energy. 3D renderings were used to help potential investors visualize what could be built, the movement of goods, and the capacity of the land and infrastructure to support significant industrial development. The materials were also meant to create awareness of the existing assets, infrastructure and supply chain in our region; and outline the potential for growth.

1. 3D Renderings could be used on their own by Port Saint John, Saint John Industrial Park, Opportunities New Brunswick and Enterprise Saint John.

2. Video incorporating 3D renderings to tell the full story of our capabilities and where potential clients could fit and grow. To be completed in 2017.

Spruce Lake Industrial Barge Facility

In June 2016, the Spruce Lake Industrial Barge Facility officially opened. We are confident this facility will attract new jobs and growth as new users, fabricators and supply chain operators are drawn to this area. Enterprise Saint John helped collaborate with Saint John Industrial Parks ACOA, the Province of New Brunswick, Port Saint John and the City of Saint John to help make this critical infrastructure project a reality. The infrastructure will help drive economic growth and new opportunities in the region.



Communications

Enterprise Saint John’s Communications focused on clearly linking how ESJ programming and projects are important to creating an environment that supports job creation.

Efforts began in 2016 to highlight to the public and stakeholders the valuable connections we make for our aspiring entrepreneurs, start-ups, existing businesses clients and extensive programming and work that is done within the community. We did this by storytelling: sharing good news from our clients, our partners and the general community.

2016 Results:

• A tour to highlight ESJ programming and an event to roll out Connected Community Vision was held in June, 2016

• Videos were created to highlight programming, staff and clients in September, 2016

• Enterprise Saint John participated and promoted the Big Data Congress that was held in Saint John in October, 2016

• Bi-weekly column for Telegraph Journal with capacity to highlight clients, programming or partners

• Social media engagement and traffic grew by 15% over previous year

• Traffic to our website grew by 29% over previous year

Looking to the Future: Canada’s Most Connected Community

Our research shows that when people and businesses are well-connected technologically, socially, and geographically, economic growth increases. Connectivity comes from access to high-speed Internet and digital networks, the diversity of local and international relationships, and community engagement in social networks. It is also reflected in business access to global markets and the ability to collect and stream data for smart decision-making. With a world-class port and transportation network, proximity to large markets in Canada and the United States, a high-capacity broadband infrastructure, and a nimble and accessible network of highly educated people, we are perfectly poised to be Canada’s Most Connected Community. To increase our connectivity and support growth in our region, Enterprise Saint John wants to build on three of its key strengths to help companies grow: Our technology, our people and our strategic location.


KPIs AND OUTCOMES FOR 2017

Client Category 2017 Q1 2017 5-years

Potential Entrepreneurs

Provide experiential education to young people

750 students and young people reached

437 4,000 students and young people reached

Start-ups and Existing Entrepreneurs

New start-ups 20 start ups 9 150 start ups

New jobs 40 9 300

High Potential Businesses

Impact on problems solved $30 million in problems solved over 3 years

N/A $70 million in problems solved

New and retained jobs 500 jobs 300 4500 jobs

External Investors

New jobs 250 jobs 77 1,500 jobs

Key priorities for 2017:

• Promote and leverage our technology, our people and our strategic location (multi-modal connections) to global markets

• Build on our world-class broadband connectivity and harness the power of data to be competitive in the new economy

• Develop potential and existing entrepreneurs

• Develop problem solvers and innovators and connect them to companies to solve corporate challenges, increase competitiveness and encourage innovation

• Continue to help companies have access to a pool of skilled talent

We are truly a connected community and will leverage this to solve problems, identify opportunities, and succeed. By tapping into the Saint John region’s existing connectedness and building new digital, human and physical connections, we will position the community for better opportunities to grow.



Enterprise Saint John Staff:

Steve CarsonCEO

Janet ScottDirector of Business and

Community Development

Mike BaconDirector of

Administration

Michele Lodge Youth

Entrepreneurship

Dakota LutesEntrepreneur

Development

Eleanor MacLeanCommunications

Mark Breen Senior Economic

Development Officer

Janice Pearson Accounting

(part-time)

WHO WE ARE

Larry HacheyBlue Chip Leasing

Chair

Paulette Hicks Delta Brunswick

Executive

Martin Chiasson Loosen Up Consulting

Executive

Terri Riedle Revolution Strategy

Executive

Charlie HarlingBell Aliant

Executive

Mary KeithJ.D. Irving, Limited

Gary LawsonLawson-Creamer

Enterprise Saint John Board:

Andrew OlandMoosehead

Breweries Limited

Jack KeirKeir Consulting

Mark ShermanIrving Oil Limited


FINANCIALS

Financial statements

Greater Saint John Community Economic Development Agency,

Incorporated

(Operating as Enterprise Saint John)

December 31, 2016

Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John)

Contents

Page Independent auditor’s report 1–2 Statement of operations 3 Statement of financial position 4 Statement of changes in net assets 5 Statement of cash flows 6 Notes to the financial statements 7–13

Grant Thornton LLP Suite 1100 Brunswick Square Office Tower 1 Germain Street Saint John, NB E2L 4V1 T +1 506 634 2900 F +1 506 634 4569 www.GrantThornton.ca

Audit • Tax • Advisory Grant Thornton LLP. A Canadian Member of Grant Thornton International Ltd

1

Independent auditor’s report

To the Directors of the Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) We have audited the accompanying financial statements of the Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) which comprise the statement of financial position as at December 31, 2016, statement of operations, statement of changes in net assets and cash flows for the year ended December 31, 2016, and a summary of significant accounting policies and other explanatory information. Management’s responsibility for the financial statements Management is responsible for the preparation and fair presentation of these 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.

Auditor’s responsibilityOur 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.

Audit • Tax • Advisory Grant Thornton LLP. A Canadian Member of Grant Thornton International Ltd

2

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

OpinionIn our opinion the financial statements present fairly, in all material respects, the financial position of Enterprise Saint John as at December 31, 2016 and the results of its operations and its cash flows for the year ended December 31, 2016 in accordance with Canadian accounting standards for not-for-profit organizations.

Saint John, Canada Grant Thornton LLP May 11, 2017 Chartered Professional Accountants

Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) Statement of operations Year ended December 31, 2016

3

Budget Enterprise Restricted for 2016 Saint John Living SJ 2016 2015 (unaudited) (Note 10) Revenue (Note 2) Municipalities – base funding (Note 8) $ 700,000 $ 699,811 $ 1,000 $ 700,811 $ 699,791 Strategic partners 250,000 212,309 - 212,309 250,000 Province of New Brunswick (Note 10) - - 195,125 195,125 2,700 Private/other funding (Note 10) - - 63,953 63,953 84,304 Entrepreneur development 205,500 215,911 - 215,911 204,288 Other revenue and sponsorships 25,000 11,481 14,140 25,621 23,795 Special projects (Note 9) 1,232,287 567,299 - 567,299 743,939 2,412,787 1,706,811 274,218 1,981,029 2,008,817 Expenditure Salaries and benefits 578,000 546,873 132,607 679,480 632,741 Communications 95,000 88,097 8,815 96,912 86,894 Business development and

investment attraction 90,000 123,253 10,152 133,405 108,141 Professional development 14,000 19,206 2,216 21,422 10,465 Vehicle and mileage 20,000 23,327 - 23,327 21,934 Partner relations - 92,000 92,000 - Neighbourhood support - 21,192 21,192 - Office and administration 158,000 112,125 7,236 119,361 145,225 Miscellaneous 1,113 - 1,113 - Amortization 5,000 - - - 18,107 Bad debt 7,084 - 7,084 - Entrepreneur development 205,500 214,276 - 214,276 209,000 Special projects (Note 9) 1,247,287 566,850 - 566,850 773,286 2,412,787 1,702,204 274,218 1,976,422 2,005,793 Excess of revenue over expenditure $ - $ 4,607 $ - $ 4,607 $ 3,024

See accompanying notes to the financial statements.

Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) Statement of financial position December 31, 2016

4

Restricted Restricted for SEED Enterprise for ConneXion Saint John Living SJ Program 2016 2015 (Note 10) Assets Current Cash (Notes 2 and 3) $ 199,551 $ 79,062 $ 234,877 $ 513,490 $ 482,849 Accounts receivable (Notes 2 and 3) 378,101 - - 378,101 575,215 HST receivable - - - - 26,855 Prepaid expenses - - - - 19,349 Due from unrestricted fund - - 1,075 1,075 1,668 577,652 79,062 235,952 892,666 1,105,936 Property and equipment (Notes 2 and 5) - - - - - Loans receivable (Notes 2, 3 and 6) - - 480,932 480,932 509,560 $ 577,652 $ 79,062 $ 716,884 $ 1,373,598 $ 1,615,496 Liabilities Current Accounts payable and accrued liabilities (Notes 2 and 3) $ 88,175 $ - $ - $ 88,175 $ 101,149 HST payable 28,309 - - 28,309 - Deferred revenue (Notes 2 and 7) 150,686 79,062 35,270 265,018 487,631 Due to restricted fund 1,075 - - 1,075 1,668 268,245 79,062 35,270 382,577 590,448 Restricted for SEED ConneXion Program (Notes 3 and 6) - - 681,614 681,614 720,248 Restricted for Living SJ - - - - - Unrestricted 309,407 - - 309,407 304,800 309,407 - 681,614 991,021 1,025,048 $ 577,652 $ 79,062 $ 716,884 $ 1,373,598 $ 1,615,496 On behalf of the Board Director Director


Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) Statement of changes in net assets Year ended December 31, 2016

5

Restricted for Restricted SEED Enterprise for ConneXion Saint John Living SJ Program 2016 2015 Balance, beginning of year $ 304,800 $ - $ 720,248 $ 1,025,048 $ 1,056,194 Interest income for SEED ConneXion Program (Note 6) - - 9,586 9,586 13,275 Training expenses for SEED ConneXion Program (Note 6) - - - - (6,032) Provision for bad debts of SEED ConneXion Program loans receivable (Note 6) - - (48,220) (48,220) (41,413) Excess of revenue over expenditure 4,607 - - 4,607 3,024 Balance, end of year $ 309,407 $ - $ 681,614 $ 991,021 $ 1,025,048


Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) Statement of cash flows Year ended December 31, 2016

6

(Decrease) increase in cash and cash equivalents Restricted Restricted for SEED Enterprise for ConneXion Saint John Living SJ Program 2016 2015 Operating Excess of revenue over expenditure $ 4,607 $ - $ - $ 4,607 $ 3,024 Item not involving cash Amortization - - - - 18,107 4,607 - - 4,607 21,131 Changes in non-cash working capital Accounts receivable 197,114 - - 197,114 (2,072) HST receivable 26,855 - - 26,855 (18,549) Prepaid expenses 19,349 - - 19,349 (3,675) Due from restricted fund 1,668 - (1,075) 593 - Accounts payable and accrued liabilities (12,975) - - (12,975) 21,767 HST payable 28,309 - - 28,309 - Deferred revenue (213,793) (8,818) - (222,611) (52,143) Due to unrestricted fund 1,075 - (1,668) (593) - 52,209 (8,818) (2,743) 40,648 (33,541) Financing Contribution from ACOA for SEED ConneXion Program loans - - - - - Investing New loans issued - - (190,000) (190,000) (270,500) Repayment of loans - - 133,495 133,495 143,718 Loan interest - - 9,586 9,586 13,275 Write-off of loans - - 36,912 36,912 - Training and other expenses - - - - (6,032) - - (10,007) (10,007) (119,539) Increase (decrease) in cash 52,209 (8,818) (12,750) 30,641 (153,080) Cash and cash equivalents, beginning of year 147,342 87,880 247,627 482,849 635,929 Cash and cash equivalents,

end of year $ 199,551 $ 79,062 $ 234,877 $ 513,490 $ 482,849


Greater Saint John Community Economic Development Agency, Incorporated (Operating as Enterprise Saint John) Notes to the financial statements December 31, 2016

7

1. Nature of operations In December 2012, the regional mayors met to review and adopt the principles laid in the True Growth 2.0 Economic Development Plan for Saint John and the surrounding municipalities. Enterprise Saint John was given a mandate to ensure that there is an integrated approach across all public and private economic development partners in the region. In addition, Enterprise Saint John plays a leadership role in developing and implementing the integrated Community Communications Network. As outlined in Note 10, on July 1, 2015 Enterprise Saint John entered into an inter-agency agreement to house and provide organizational support for Living SJ. Enterprise Saint John is incorporated without share capital under the laws of the Province of New Brunswick. Enterprise Saint John qualifies as a non-profit organization under the Income Tax Act and, as such, is exempt from income taxes. 2. Significant accounting policies Basis of presentation Enterprise Saint John’s financial statements are prepared in accordance with Canadian accounting standards for not-for-profit organizations. Revenue recognition Enterprise Saint John follows the deferral method of accounting for contributions from government and the private sector which relate to specific projects. These restricted contributions are recognized as revenue in the year 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. Strategic partner funding is invoiced as commitments are made and is recognized as revenue in the year for which the work plan commitment is made. Contributions approved but not received at the balance sheet date are accrued as receivable. Interest income on loans receivable under the SEED ConneXion Program are recognized as earned, and is recorded as a direct increase to the restricted equity for SEED ConneXion Program. Financial instruments policy Financial instruments include:

Cash

Accounts receivable

Loans receivable under the SEED ConneXion Program

Accounts payable and accrued liabilities


8

2. Significant accounting policies (continued) Financial instruments policy (continued) Financial instruments are recorded at fair value when acquired or issued. All financial instruments subsequently measured at amortized cost, and tested for impairment at each reporting date. Transaction costs on the acquisition, sale, or issue of financial instruments carried at fair value are expensed when 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 a fiscal year if there are indications of impairment. If there is an indication of impairment, Enterprise Saint John determines if there is a significant adverse change in the expected amount or timing of future cash flows from the financial asset. If events and circumstances reverse in a future period an impairment loss will be reversed to the extent of the impairment, not exceeding the initial carrying value. Property and equipment Property and equipment are stated at cost less accumulated amortization. Amortization is being provided for using the straight-line method over the following periods: Office furniture 5 years Computer equipment 3 years Leasehold improvements Over the lease term Contributed services Volunteers contribute an indeterminable number of hours per year. Because of the difficulty of determining their fair value, contributed services are not recognized in the financial statements. Cash and cash equivalents Cash and cash equivalents include cash on hand, balances with banks and short-term deposits with original maturities of three months or less. The preparation of financial statements in accordance with Canadian accounting standards for not-for-profit organizations requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amount of revenues and expenditures during the reporting period. These estimates are reviewed periodically, and as adjustments become necessary, they are reported in earnings in the period in which they become known. Examples of significant estimates include:

Allowance for doubtful accounts Impairment of loan receivable under the SEED ConneXion Program Estimated useful lives of assets Recoverability of property and equipment


9

2. Use of estimates (continued) Allocation of expenditures Enterprise Saint John allocates certain expenditures, including payroll to various projects, that are part of its operations. Enterprise Saint John allocates these expenditures by identifying the appropriate basis and applies that basis consistently each year. 3. Financial instruments Enterprise Saint John is exposed to various risks through its financial instruments and has a comprehensive risk management framework to monitor, evaluate and manage these risks. The following analysis provides information about the Board of Directors’ risk exposure and concentration as at December 31, 2016: Credit risk Enterprise Saint John is subject to credit risk through accounts receivable. Enterprise Saint John also administers loans receivable under the SEED ConneXion Program. Enterprise Saint John maintains a provision for potential credit losses, and minimizes credit risk through ongoing credit management. Liquidity risk Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities. Enterprise Saint John is exposed to this risk mainly in respect of its receipt of funds from its contributors and other related sources, accounts payable, and other obligations. Enterprise Saint John maintains a line of credit with a limit of $50,000. Currency risk Currency risk is the risk to Enterprise Saint John’s earnings that arise from fluctuations of foreign exchange rates and the degree of volatility of these rates. Enterprise Saint John is not exposed to foreign currency exchange as it does not hold foreign currency. Interest rate risk Interest rate risk is the risk that the value of a financial instrument might be adversely affected by a change in the interest rates. The SEED ConneXion Program is currently exposed to interest rate risk on its loans receivable.


10

4. True Growth strategic projects

The group of projects referred to as “True Growth” represent strategic projects undertaken by Enterprise Saint John usually in partnership with other organizations, which lead to the enhancement of the community’s ability to attract people, ideas and investment to the region and fit within Enterprise Saint John’s strategic priorities. Projects, which include energy hub development and workforce expansion and development, generally demonstrate community impact beyond just traditional economic development and can include those which are economic, social, cultural or environmental in nature. Funding partners include the Federal Government (Department of Foreign Affairs and International Trade, ACOA), Province of New Brunswick and municipal governments, as well as other associations, agencies and the private sector. 5. Property and equipment 2016 2015 Accumulated Net Net Cost Amortization Book Value Book Value Computer equipment $ 40,770 $ 40,770 $ - $ - Office furniture 1,721 1,721 - - Leasehold improvements 73,715 73,715 - - $ 116,206 $ 116,206 $ - $ - 6. SEED ConneXion Program The Young Entrepreneurs ConneXion – SEED Capital and Counselling Program (“SEED ConneXion Program”) is a project designed to provide access to capital and counselling/training support for those who are starting, expanding or modernizing a business. Funding for existing business expansion is limited to those 18–34 years of age. There are no age restrictions for funding to start a business. Funding is provided up to a maximum of $20,000 per application. Loans receivable from clients participating in the program are repayable in various payments including interest at prime plus 2% over periods of 18 to 60 months. Under the terms of the agreement with ACOA, effective April 1, 2006 to September 30, 2014 the interest income and the provision for bad debts of these loans are recorded directly to the SEED ConneXion Program net assets. Separate government extension contracts also provide for continued funding for the program coordinator. With the ACOA project contract ending during the year, Enterprise Saint John has started to fund the program directly with core funding. Enterprise Saint John will maintain the project going forward.


11

6. SEED ConneXion Program (continued) Due to the nature of the loans, the credit risk is high and the fair value of the loans may be less than their carrying value. As a result, management has adopted the policy to allow for 100% of loan balances that have gone six months or more without receiving a scheduled payment. For loans with payments in the last six months that have been classified as delinquent (behind on scheduled payments), management has allowed for 100% of the overdue payments. Management also makes an analysis based on knowledge of payment history and communication with loan applicants. As at December 31, 2016, $103,099 (2015 – $238,042) of loans were identified as delinquent. Management has provided an allowance of $77,799 (2015 – $83,458) related to these loans. During the year, management have written-off loans totalling $42,252 (2015 – $57,280). 7. Deferred revenue 2016 2015 True Growth $ 88,137 $ 90,164 Strategic partners - 215,058 Work Force Expansion 40,503 40,503 ACOA and Province of New Brunswick 16,742 18,755 Business Resource Centre 5,304 - 150,686 364,480 Living SJ (Note 10) 79,062 87,880 SEED ConneXion Program 35,270 35,271 Total deferred revenue $ 265,018 $ 487,631 8. Municipalities – base funding Budget 2016 2016 2015 City of Saint John $ 475,000 $ 475,020 $ 475,000 Town of Quispamsis 112,000 112,000 112,000 Town of Rothesay 86,500 86,422 86,422 Town of Grand Bay-Westfield 25,000 24,836 24,836 Village of St. Martins 1,500 1,533 1,533 $ 700,000 $ 699,811 $ 699,791


12

9. Special projects 2016 2015 Revenue Big Data 2015 $ - $ 103,712 Catalyst 124,425 69,882 Export Sales 53,939 108,543 ICCI 2015/2016 63,043 35,500 Venture Garage 118,220 81,817 Energy Related 190,243 - Modular Fabrication 17,429 - Walrus Talks - 29,719 Health and Life Sciences - 92,451 True Growth – other projects - 25,183 Trade Americas - 4,636 International Venture Club - 6,019 Transatlantic Shipping - 190,610 Engage Conference - (4,133) 567,299 743,939 Expenditure Big Data 2015 - 103,712 Catalyst 132,448 65,144 Export Sales 66,375 99,401 ICCI 2015/2016 63,288 35,500 Venture Garage 115,834 83,479 Energy Related 179,648 - Modular Fabrication 9,257 - Walrus Talks - 29,719 Health and Life Sciences - 86,578 True Growth – Work Force Expansion - 51,491 True Growth – other projects - 25,183 Trade Americas - 7,764 International Venture Club - 4,540 Transatlantic Shipping - 184,190 Other - (3,415) 566,850 773,286 $ 449 $ (29,347) Funding partners for these special projects include the Federal Government (Department of Foreign Affairs and International Trade, ACOA), Province of New Brunswick and municipal governments, as well as other associations, agencies and the private sector.


13

10. Living SJ On July 1, 2015, Enterprise Saint John entered into a host agency agreement with Living SJ to house and provide organizational support for Living SJ. The vision of Living SJ is a strong community working together to improve the quality of life for all citizens of Greater Saint John. The mission of Living SJ is to develop a plan to engage community and influence leadership to optimize social impact. The four priorities of Living SJ are as follows:

Transform low-income neighbourhoods into vibrant mixed income communities

Close the education achievement gap

Improve the health of residents through neighbourhood-based models of care

Education and training that leads to employment for low-income residents 11. Comparatives Certain of the prior year figures presented for comparative purposes have been reclassified to conform to financial statement presentation adopted for the current year.

The Telegraph Building

40 King Street

Saint John, New Brunswick

E2L 1G3

Canada

506 658 2877

[email protected]

enterprisesj.com

@enterprisesj

new inspiring people, ideas and investment - edgsj · 2019. 1. 29. · innovators, the private...

Documents