Financial statements of

Burlington Museums Board December 31, 2015

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Burlington Museums Board December 31, 2015 Table of contents Independent Auditor’s Report ............................................................................................................................ 1-2

Statement of financial position .............................................................................................................................. 3

Statement of operations ........................................................................................................................................ 4

Statement of change in net financial assets .......................................................................................................... 5

Statement of cash flows ........................................................................................................................................ 6

Notes to the financial statements ..................................................................................................................... 7-10

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Deloitte LLP 1005 Skyview Drive Suite 200 Burlington ON L7P 5B1 Canada Tel: 905-315-6770 Fax: 905-315-6700 www.deloitte.ca

Independent Auditor’s Report To the Members of the Burlington Museums Board, Members of Council, Inhabitants and Ratepayers of the Corporation of the City of Burlington We have audited the accompanying financial statements of the Burlington Museums Board, which comprise the statement of financial position as at December 31, 2015, and the statements of operations, change in net financial assets and cash flows for the year then ended, 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 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.

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Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of the Burlington Museums Board as at December 31, 2015 and the results of its operations, change in net financial assets and its cash flows for the year then ended in accordance with Canadian public sector accounting standards. Chartered Professional Accountants Licensed Public Accountants April 28, 2016

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Burlington Museums BoardStatement of financial positionyear ended December 31, 2015

Ireland Joseph

House BrantMuseum Museum 2015 2014

$ $ $ $

Financial assetsCash 203,243 285,365 488,608 369,540 Accounts receivable 4,231 1,449 5,680 2,680 Due from Joseph Brant Museum 132,959 - 132,959 127,920 Due from City of Burlington (Note 3) 92,808 1,444,061 1,536,869 1,197,848

433,241 1,730,875 2,164,116 1,697,988

LiabilitiesAccounts payable and accrued liabilities 20,167 20,136 40,303 49,196 Deferred revenue 4,556 2,387 6,943 4,566 Due to Ireland House Museum - 132,959 132,959 127,920

24,723 155,482 180,205 181,682

Net financial assets 408,518 1,575,393 1,983,911 1,516,306

Non-financial assetsPrepaid expenses 300 900 1,200 1,961 Tangible capital assets (Note 7) 57,755 19,806 77,561 73,118

58,055 20,706 78,761 75,079

Accumulated surplus (Note 5) 466,573 1,596,099 2,062,672 1,591,385

The accompanying notes to the financial statements are an integral part of this financial statement.

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Burlington Museums BoardStatement of operationsyear ended December 31, 2015

Ireland House Museum Joseph Brant Museum 2015 2014Budget Actual Budget Actual Budget Actual Actual

$ $ $ $ $ $ $

RevenueMunicipal contribution

Operating 327,830 327,830 327,830 327,830 655,660 655,660 645,878 Capital - 42,475 - 42,475 - 84,950 57,050

Ontario grants 29,373 29,373 29,053 29,053 58,426 58,426 58,426 Donation from Burlington Museums Foundation - - - 300,000 - 300,000 300,000 Federal grants/employment grants - 7,838 - 7,873 - 15,711 8,156 Admissions and program revenue 45,692 66,481 44,615 42,257 90,307 108,738 97,861 Other income 13,077 35,906 9,319 25,899 22,396 61,805 43,567 Interest earned in reserves - 3,470 - 40,986 - 44,456 36,532

415,972 513,373 410,817 816,373 826,789 1,329,746 1,247,470

ExpensesAmortization 19,186 16,989 9,497 9,497 28,683 26,486 19,278 Collections management 6,363 8,829 8,174 10,789 14,537 19,618 8,409 Doors open Burlington 2,500 4,096 2,500 4,031 5,000 8,127 8,367 Fee Waiver - JB Day - - 1,244 1,244 1,244 1,244 1,244 General office materials 3,750 6,793 3,750 4,200 7,500 10,993 11,016 Insurance 2,252 2,635 500 305 2,752 2,940 2,733 Loss on disposal of tangible capital assets - 1,330 - 1,034 - 2,364 2,155 Museums programs 24,258 35,916 24,257 27,774 48,515 63,690 51,031 Professional fees 3,517 3,007 3,515 3,010 7,032 6,017 5,953 Purchases of inventory 4,501 4,716 4,500 3,746 9,001 8,462 8,764 Repairs and maintenance 22,782 17,838 16,330 31,543 39,112 49,381 63,371 Salaries, wages and benefits 326,764 299,352 326,763 299,352 653,527 598,704 603,591 Salaries, wages and benefits - grants 500 10,152 500 10,653 1,000 20,805 10,272 Staff development and travel 2,161 2,549 2,162 2,430 4,323 4,979 2,797 Telephone and utilities 16,624 23,548 16,622 11,101 33,246 34,649 33,670

435,158 437,750 420,314 420,709 855,472 858,459 832,651

Annual surplus (deficit) (19,186) 75,623 (9,497) 395,664 (28,683) 471,287 414,819 Accumulated surplus, beginning of year 390,950 390,950 1,200,435 1,200,435 1,591,385 1,591,385 1,176,566 Accumulated surplus, end of year 371,764 466,573 1,190,938 1,596,099 1,562,702 2,062,672 1,591,385

The accompanying notes to the financial statements are an integral part of this financial statement.

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Burlington Museums BoardStatement of change in net financial assetsyear ended December 31, 2015

Budget 2015 2014$ $ $

Annual (deficit) surplus (28,683) 471,287 414,819

Acquisition of tangible capital assets - (33,293) (14,807) Loss on disposal of tangible capital assets - 2,364 2,155 Amortization of tangible capital assets 28,683 26,486 19,278

28,683 (4,443) 6,626

Acquisition of prepaid expenses - (1,200) (1,961) Use of prepaid expenses - 1,961 3,463

- 761 1,502

Change in net financial assets - 467,605 422,947 Net financial assets, beginning of year 1,516,306 1,516,306 1,093,359 Net financial assets, end of year 1,516,306 1,983,911 1,516,306

The accompanying notes to the financial statements are an integral part of this financial statement.

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Burlington Museums BoardStatement of cash flowsyear ended December 31, 2015

2015 2014$ $

Operating activitiesAnnual surplus 471,287 414,819 Items not affecting cash

Amortization 26,486 19,278 Loss on disposal of tangible capital assets 2,364 2,155

Changes in non-cash operating working capital itemsAccounts receivable (3,000) 299,571 Due from City of Burlington (339,021) (654,953) Prepaid expenses 761 1,502 Accounts payable and accrued liabilities (8,893) 4,809 Deferred revenue 2,377 634

152,361 87,815

Capital activityPurchase of tangible capital assets (33,293) (14,807)

Net change in cash 119,068 73,008 Cash, beginning of year 369,540 296,532 Cash, end of year 488,608 369,540

Cash consists of the followingIreland House Museum cash 203,243 138,841 Joseph Brant Museum cash 285,365 230,699

488,608 369,540

The accompanying notes to the financial statements are an integral part of this financial statement.

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Burlington Museums Board Notes to the financial statements December 31, 2015

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1. Description of the Organization

The Burlington Museums Board (the “Board”) was established by the Council of the City of Burlington to administer the operations and activities of the Joseph Brant Museum and the Ireland House Museum. The Board is exempt from income taxes under the Income Tax Act.

2. Accounting policies

Basis of accounting

The financial statements of the Burlington Museums Board are prepared in accordance with Canadian public sector accounting standards. The significant accounting policies of the Board are as follows:

Revenues

Revenues are reported on the accrual basis of accounting which recognizes revenues as they become available and measurable. Expenses are reported on the accrual basis of accounting which recognizes expenses as they are incurred and measurable as a result of a receipt of goods or services and the creation of a legal obligation to pay.

Tangible capital assets

Tangible capital assets are recorded at cost which includes all amounts that are directly attributable to acquisition, construction, development or betterment of the asset. Tangible capital assets received as contributions are recorded at their fair value at the date of receipt. The cost, less residual value, of the tangible capital assets is amortized on a straight-line basis over their estimated useful lives as follows:

Computer equipment 3 years Security system 5 years Machinery and equipment 10 to 12 years

Annual amortization is charged in the year of acquisition and in the year of disposal on a pro-rated basis. Assets under construction are not amortized until the asset is available for productive use.

Government transfers

Government transfers are recognized in the financial statements as revenue in the financial period in which the events give rise to the transfer occur, eligibility criteria are met, and reasonable estimates of the amount can be determined.

Investment income

Investment income earned is reported as revenue in the period earned.

Use of estimates

The preparation of financial statements in accordance 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 at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Items requiring the use of significant estimates include the useful lives of tangible capital assets. Actual results could differ from those estimates.

Financial instruments

The estimated fair value of cash, accounts receivable, due from the City of Burlington and accounts payable and accrued liabilities approximate their carrying value due to the relatively short-term nature of the instruments.

3. Due from City of Burlington

The balance due from the City of Burlington is non-interest bearing and has no set terms of collection.

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Burlington Museums Board Notes to the financial statements December 31, 2015

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4. Pension agreements

The Board makes contributions to the Ontario Municipal Employees Retirement System (OMERS), which is a multi-employer plan, on behalf of its full time and eligible part time staff. The plan is a defined benefit plan which specifies the amount of the retirement benefit to be received by the employees based on the length of service and rates of pay.

Contributions to OMERS are made at rates ranging from 9% to 14.6% depending on the proposed retirement age and the level of earnings. During 2015, the Board contributed $28,487 (2014 - $29,878) to OMERS.

5. Accumulated surplus

2015 2014$ $

Consists ofReserves set aside by the Board

Joseph Brant general reserve 32,262 31,358 Joseph Brant project reserve 152,676 180,956 Joseph Brant transformation project reserve 1,278,950 918,088 Ireland House general reserve 7,752 7,535 Ireland House project reserve 116,250 115,452

1,587,890 1,253,389

SurplusesInvested in tangible capital assets 77,561 73,118 General fund 397,221 264,878

474,782 337,996

Accumulated surplus 2,062,672 1,591,385

Project reserves

General and project reserves are funds set aside for future operating and capital expenditures, as approved by the Board.

Joseph Brant transformation project reserve

The Joseph Brant transformation project reserve represents funds set aside for the renovation and expansion of the Joseph Brant Museum project. DRAFT

Burlington Museums Board Notes to the financial statements December 31, 2015

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6. Budget figures

The budgets originally approved by the Burlington Museums Board for 2015, adjusted as noted below, are reflected on the statement of operations and of change in net financial assets.

An amount for amortization expense has been added and is based on management’s best estimate of amortization expense determined at the beginning of the year. Amortization expense was not included in the original Museum Board approved budget.

$

Adopted budgetBudget annual surplus -

Adjustments to the adopted budgetAmortization of tangible assets 28,683

Budgeted deficit per statement of operations 28,683

7. Tangible capital assets

2015Accumulated Net book

Cost amortization value$ $ $

Ireland House MuseumComputer equipment 21,661 11,497 10,164 Security system 4,394 3,515 879 Machinery and equipment 128,756 82,044 46,712

154,811 97,056 57,755

Joseph Brant MuseumComputer equipment 6,181 3,022 3,159 Security system 677 649 28 Machinery and equipment 85,230 68,611 16,619 Balance, end of year 92,088 72,282 19,806

Net book value of tangible capital assets 246,899 169,338 77,561

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Burlington Museums Board Notes to the financial statements December 31, 2015

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7. Tangible capital assets (continued)

2014Accumulated Net book

Cost amortization value$ $ $

Ireland House MuseumComputer equipment 20,523 7,313 13,210 Security system 4,394 2,638 1,756 Machinery and equipment 116,286 80,557 35,729

141,203 90,508 50,695

Joseph Brant MuseumComputer equipment 7,193 4,719 2,474 Security system 677 406 271 Machinery and equipment 81,020 61,342 19,678 Balance, end of year 88,890 66,467 22,423

Net book value of tangible capital assets 230,093 156,975 73,118

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