Town's 2016 audit comes back clean
No significant changes from previous year
Tuesday, Apr 18, 2017 06:00 am
Auditors identified no significant matters in their 2016 review of the town’s finances, which were presented at the council meeting last Monday (April 10).
“A clean auditor’s opinion, no surprises there,” said Darren Adamson, from the accounting firm Avail LLP, which was awarded a three-year contract in 2016 to complete the annual audit.
For highlights this year, Anderson said the town generated almost $5 million in cash from operations and invested $2.3 million of that in capital assets. In addition, the town paid down $1.1 million of debt over 2016.
Revenue came in slightly over budget at $21.7 million, an increase of almost $2 million from the previous year, the bulk of which was due to property tax revenue and utilities revenue due to increased rates.
Expenses totalled almost $22.6 million, which is $3.2 million over budget. Anderson explained, however that $2.5 million of that is not actually overspending, but is attributable to how the town accounts for the amortization of capital assets, which are logged as expenses, but paid from reserves.
“It’s kind of a philosophy of the way the town funds the capital asset additions,” he said. “The current year's operations used that portion, theoretically, of that asset, so we would expense that portion to operations.”
In addition to this “budget discrepancy” Anderson noted expenses increased by $1.4 million this year, due in part to the Fort McMurray fires, increased water treatment fees, and extra expenses for recreation, parks and culture.
The town’s financial assets currently amount to just over $26.7 million, on top of $73.2 million in tangible capital assets, such as buildings. The largest financial asset is an outstanding loan owed by the Olds Institute, which totals $13.8 million, made for the installation of fibre optic lines throughout the town in 2013.
Financial assets also include $4.2 million in cash and temporary investments.
Chief financial officer Garth Lucas said that there has been significant improvement in the town’s ability to collect outstanding accounts, noting none are currently more than 60 days in arrears.
As of Dec. 31, 2016 the town’s liabilities add up to just over $21 million, the bulk of which are in long-term debt. Interest on long-term debt amounted to $291,961.
When all is said and done, the town’s accumulated surplus – the totalled financial and non-financial assets minus liabilities – at the end of year was just shy of $80 million, an increase of $3.75 million from 2015. According to Anderson, $12 million of that is unrestricted or in reserves, and available for future spending.
“It's a pretty good place to be,” he said. “I don’t think it’s excessive, but I think it's a nice place to be for a little bit of certainty going forward.”
The cost of the 2016 audit is $29,390, accounted for in the 2017 budget.
PROPERTY TAX REVENUE
Total $6.8 million
Mayor $59,758 (including benefits)
Councillor approx. $30,000 each
CAO $199,603 (including benefits)