2018 Annual Financial Report - Northumberland County · Northumberland County is committed to...

2018 ANNUAL FINANCIAL REPORT

The 2018 Annual Financial Report has been prepared in an electronic format and is available on the County’s website at northumberland.ca/2018AnnualReport.The Corporation of the County of Northumberland Financial Report 2018 For the fiscal year ending December 31, 2018 Cobourg, Ontario, CanadaNot for reproduction without permission.

Northumberland County is committed to complying with the Accessibility for Ontarians with Disabilities (AODA) Act and all standards under it in order to create a barrier-free Ontario. The County is committed and guided by the four core principles of dignity, independence, integration and equal opportunity, and supports the full inclusion of persons as set out in the Canadian Charter of Rights and Freedoms, and the AODA.

This document is available in an accessible format, upon request.

Accessibility

Fiscal year ending December 31, 2018

2018 ANNUAL REPORT

Table of Contents

WHAT’S INSIDE?

County OverviewWho We Are .................................................................................................................... 1On the Map .................................................................................................................... 2The County at a Glance ............................................................................................... 3Meet County Council .................................................................................................... 5Warden’s Message ......................................................................................................... 6Meet our Leadership Team ........................................................................................... 8CAO’s Message .............................................................................................................. 9What We Do ................................................................................................................. 11Treasurer’s Message ................................................................................................. 16

Highlights and Goals2018 Highlights ............................................................................................................... 19Looking Ahead to 2019 ................................................................................................ 23In the Community ........................................................................................................ 25

Financial OverviewFinancial Management .............................................................................................. 27Financial Overview ...................................................................................................... 29

Financial StatementsFinancial Statements ................................................................................................... 31

Connect with UsVolunteer with the County .......................................................................................... 61Connect with the County ........................................................................................... 62

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About Northumberland

COUNTYOVERVIEW

1

To bring together people, partnerships and possibilities for a strong and vibrant Northumberland County.

Vision

To be a best practices leader of County government, and a collaborative partner with our member municipalities and community partners.

Mission

The County has a set of values— shared beliefs—that guide us toward our ultimate goals and unite us along the way. In all of our actions and decision-making, we reference these values:

Values

• Accountability• Care and Support• Collaboration and Communication• Honesty and Integrity• Innovation and Excellence• Mutual Trust and Respect

Northumberland County

WHO WE ARE

2

The County of Northumberland is the upper tier level of municipal government that weaves together seven diverse, yet complementary municipalities:

We also value our long-standing relationship with Alderville First Nation | www.alderville.ca

Township of Alnwick/Haldimandwww.alnwickhaldimand.caMunicipality of Brightonwww.brighton.caTown of Cobourgwww.cobourg.caTownship of Cramahewww.cramahe.ca

Township of Hamiltonwww.hamiltontownship.caMunicipality of Port Hopewww.porthope.caMunicipality of Trent Hillswww.trenthills.ca

Our Location

ON THE MAP

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Northumberland County is a thriving, south-eastern Ontario community. It is easily accessible from Highway 401, exits 45 (Port Hope) through to 509 (Brighton).

How to find us

Our community

drive from Toronto to Kingston

1.5 HRdrive from most

large northeastern cities in the US

1 DAYaccess from Lake

Ontario, Rice Lake & Trent-Severn Waterways

BOATING

POPULATION

90,437PROJECTED

POPULATION FOR 2019

EMPLOYMENT

47,435TOTAL EXPERIENCES LABOUR FORCE (2015)

Northumberland Quick Facts

THE COUNTY AT A GLANCE

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MULTI-RESIDENTIAL

0.00954679

What we offer

2018 tax rates (County only)*

Special placesPicturesque Port Hope Historic lakeshore, early churches and unique downtown.Cobourg and Rice Lake Roseneath carousel, Cobourg waterfront, historic downtown and Gores Landing Warf.Rolling Hills, Adventures and ArtsShops brimming with treasures, and historic and natural sites.Beaches, Barns and the Big AppleWicklow and Presqu’ile beaches, Proctor House, the Barn Theatre, the Big Apple and the Apple Route.Trent Hills CharmChocolate and cheese factories, local craft beer and river-side towns.

Diverse scenery A range of living experiences from historic towns to scenic rural areas.Outdoor adventures 37 trails, 15 conservation areas, 2 forests, 2 provincial parks, 1 nature reserve, and access to the Trent-Severn Waterway and Lake Ontario. World-class cycling routes and some of the best diverse places to fish in Southern Ontario.A beautiful place to relaxThe rolling hills feature historic inns, B&Bs and destination spas.Vibrant arts and cultureHistoric main streets, exceptional architecture, festivals, music and art galleries, and unique performance venues.Farm fresh destinationsSpecialty outlets, craft breweries, the Butter Tart Tour, and farm fresh destinations.

(**MUNICIPAL AND EDUCATION IN ADDITION)

COMMERCIAL

0.00723265INDUSTRIAL

0.01183801

RESIDENTIAL

0.00477339

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2018-2022 County Council

MEET COUNTY COUNCIL

County councillors (left to right)Bob SandersonMayor of the Municipality of Port HopeBill CaneMayor of the Township of HamiltonJohn HendersonMayor of the Town of CobourgJohn Logel2019 Warden of Northumberland County and Mayor of the Township of Alnwick/Haldimand

Brian OstranderMayor of the Municipality of BrightonBob CrateMayor of the Municipality of Trent HillsMandy MartinMayor of the Township of Cramahe

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I am pleased to present Northumberland County’s 2018 Annual Report, which is a cornerstone of the County’s commitment to accountable and transparent operations. This report details the positive financial position of the organization, while highlighting the breadth of programs and services being delivered that are strengthening our community.2018 was a year of progress as staff and Council collaborated to close-out the final leg of our four-year Strategic Plan. We continued to focus on the four key priorities captured within this plan in order to strategically assess and give precedence to projects and initiatives that would foster a strong and vibrant Northumberland: economic innovation and prosperity, sustainable infrastructure and services, thriving and inclusive community, and organizational excellence. In so doing, we proudly achieved major milestones for the community

while maintaining strong, stable fiscal health. Some of these notable accomplishments included:

Infrastructure development • In collaboration with the Township of

Alnwick/Haldimand, we completed construction on a new joint paramedic/fire base for Roseneath, achieving efficiencies through shared services, and creating opportunities for emergency personnel to strengthen the ties that ultimately lead to more seamless first response for our community.

• We completed preliminary detailed design for the redevelopment of the Golden Plough Lodge (GPL) and Northumberland County Archives facility, and announced funding from the province to add an additional 29 beds to the new GPL, responding to a tremendous need for greater access to long-term care in this community.

Housing Stability• We launched the creation of an

Affordable Housing Strategy, which will stimulate the development of public, private and non-profit rental housing across Northumberland. We also implemented and oversaw the provincially and federally-funded Social Infrastructure Fund—an investment of over $2 million in Northumberland over a three-year period. In 2018,

Northumberland County Warden

WARDEN’S MESSAGE

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John LogelNorthumberland County Warden

programming included the Housing Support Program, Renovate Northumberland and the completion of four homes through Habitat for Humanity Northumberland.

Economic Development• Our Business & Entrepreneurship

Centre Northumberland (BECN), supported 111 business start-ups, creating 135 jobs in our community. We also hosted the first local conference specifically-designed for small businesses, with tickets quickly selling out to 125 entrepreneurs who came together to collaborate, network and grow their operations.

Environmental Sustainability

• Council approved upgrades to the public drop-off areas at our Landfill and Waste Transfer Stations that will enable more waste materials to be diverted from the landfill, and we are further emphasizing our focus on diversion by rebranding these locations as Community Recycling Centres. We also celebrated the signing of a waste services agreement with Alderville First Nation, which will strengthen our

long-term goal of diverting up to 75% of all waste from the local landfill.

Of course, there are many more examples of the excellent work completed by our wonderful staff—too many to mention. Our accomplishments are the result of true team work, and I want to recognize the senior leadership team, staff and my colleagues on County Council for their many contributions to the successes captured in this report. Also central to achieving these outcomes has been the County’s ongoing collaboration with community partners along with other levels of government and First Nations. These relationships are vital to successfully serving our community, and Council looks forward to new opportunities to learn and work together as we strive to enhance livability in Northumberland.I want to thank staff for their hard work in 2018 to deliver key projects on-time and on-budget. Together, we focused on people, nurtured partnerships, and created new possibilities in our efforts to deliver quality programs and services that are having a meaningful impact on the lives of our residents.

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Jennifer MooreChief Administrative Officer (CAO)

Lisa Ainsworth Director,

Corporate Services

Dan BorowecDirector,

Economic Development &

Tourism

Kate CampbellDirector,

Communications

Clare DawsonAdministrator, Golden Plough

Lodge

Glenn DeesDirector, Finance/

Treasurer

William DetlorChief,

Northumberland Paramedics

Lisa HorneDirector,

Community & Social Services

Mobushar Pannu

Director, Transportation,

Waste & Facilities

Tony PaulicDirector,

Information Technology

Organizational Structure

MEET OURLEADERSHIP TEAM

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As we take stock of 2018, I am pleased with our continued momentum in realizing our mission to be a best practices leader in county government. Throughout the year, we achieved significant progress across all departments on projects of importance to our residents, ranging from upgrades to our transportation network and waste services system, to developments in housing and homelessness, notable successes through our entrepreneurship programs, strategic planning in long-term care, and improved emergency preparedness and response.While capital projects, program enhancements and community strategic plans were certainly at the forefront of our efforts, the County also dedicated significant energy behind the scenes to making our services more efficient and accessible for the community.

• Consistent with our emphasis on organizational excellence, the

County is pursuing the integration of ‘Lean’ practices into our processes in order to reduce waste and inefficiency, and deliver improved value to the community. Lean is a philosophy of continuous improvement that places customer value at the centre of all process design. We have trained staff across the organization in Lean principles, and multiple projects got underway in 2018 to assess and modify practices in areas such as payroll, purchasing and customer service. Our aim is for Lean to become a part of the County’s corporate culture, and we look forward to sharing, with Council and the community, regular updates about efficiencies generated.

• The County is evolving its approach to the integration and management of information technology into our operations in recognition that IT is changing both how municipalities do business and also how the community interacts with our organization. An IT Strategic Plan was delivered to Council in 2018, which will facilitate and enable the organization’s key business objectives now and into the future. As part of this plan, we made enhancements to IT security and initiated cybersecurity awareness training for staff. We also implemented technology to

Chief Administrative Officer

CAO’S MESSAGE

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improve internal processes such as asset management, and to improve customer service, including electronic bid submissions and an increase in the number of forms and permits that can be submitted online.

• Making our services more accessible to all members of our community is a perennial goal, and we sincerely appreciate the regular feedback from our Accessibility Advisory Committee in support of these efforts. In 2018, we launched a project to build a new corporate website, which will significantly enhance the accessibility of our online information and services. We also increased accessibility at County facilities and housing units, including the installation of universal washrooms at our Cobourg and Morganston Roads Depots, and the addition of an accessible lift at 112 Front Street.

Council consistently challenges staff to deliver efficiencies, model our core values, and fulfill the objectives outlined in our Strategic Plan. This report details the many instances in 2018 where staff demonstrated that they were equal to the task.

2019 will bring new challenges as we continue to respond to budgetary and service delivery pressures while being mindful of any impact to local ratepayers. The County remains steadfast in its commitment to quality program and service delivery, efficiency generation, and prudent financial management, all of which will continue to position our organization to best meet the needs and expectations of residents. As always, I would like to offer my sincere thanks to our Finance team members for their strategic, planning and financial leadership, and operational accounting support, all of which continue to underpin our every success.

Jennifer MooreChief Administrative Officer


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Northumberland County provides a number of services from many departments including: Corporate Services, Communications, Finance & Treasury, Economic Development & Tourism, Information Technology, Community & Social Services, Transportation & Waste as well as Northumberland Paramedics and our Long Term Care Home, Golden Plough Lodge.

Infrastructure services• County Roads• Waste Management• Land Use Planning• Plumbing & Septic Inspection• Northumberland County Forest

People services• Food 4 All Warehouse• Northumberland Paramedics• Tourism & Manufacturing Attraction• Golden Plough Lodge Long Term Care Home• Early Years, Housing & Homelessness Services• Business & Entrepreneurship Centre Northumberland• Ontario Agri-Food Venture Centre & Agriculture Services

Support services• Provincial Offences• Health & Safety/Emergency Planning• Human Resources and Financial Services• Information Technology and Communications• County Clerk/Archives and Records Management

Our Services

WHAT WE DO

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Communications• Ensures a coordinated, best-practice approach to sharing information that is timely,

accurate, clear, responsible and responsive• Fosters alignment between corporate messaging, imaging and activities, and the

organization’s mission, vision and values• Encourages and enhances two-way communication with residents, stakeholders

and employees

Community & Social Services• Develops, delivers, and manages a range of services that help people in the community• Works with community partners to ensure vulnerable residents have the tools and

supports to move forward in their lives• Operates Community Service Hubs throughout the county to meet multiple client

needs at a single location, making social services more accessible• Services include:

• Financial and Employment Support Programs• Family and Children Support Programs• Homelessness Support Programs• Social and Affordable Housing Programs• Community Outreach & Health and Wellness Supports• Food Security Programs

Corporate Services• Provides leadership, direction and support in areas including:

• Accessibility• County Clerk and Legislative Services• County Forest• Health, Safety & Emergency Planning• Human Resources, Payroll & Benefits• Records Management & Archives

Departments

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Economic Development, Land Use Planning & Tourism• Fosters economic innovation and prosperity by providing leadership and support for

coordinated economic development activities in Northumberland County• Accountabilities include:

• Information — central source of data for potential investors• Referral — support for attraction and retention strategies• Coordination—strategic initiatives for broader economic development, immigration

strategies, entrepreneur development and business start ups, and agriculture• Programs and services include:

• The Ontario Agri-Food Venture Centre (OAFVC)• Land use planning and inspection services• The Business & Entrepreneurship Centre of Northumberland• Business Immigration Portal• Tourism services• Agriculture services

Finance & Treasury• Provides supports to internal and external partners to drive financial strength and

sustainability• Drives efficiency and continuous improvement in County financial services• Budget development; operating and capital financial plans• Records and reports all financial transactions, collection and investments• Performs purchasing functions and implements financial policies and internal controls• Risk management

Information Technology• Provides strategic technology leadership and guidance to the County• Maintains a state of good repair of the technology infrastructure (network, server,

storage, software and user computing devices)• Delivers helpdesk and technical support, business relationship management, and

IT project and implementation expertise• Ensures security and risk management of the County’s technology assets and

information• Provides managed IT services to a number of member municipalities/organizations

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Long term care: Golden Plough Lodge• Provides a home for adults whose needs can no longer be met within the community• Committed to supporting individuals to maintain a life with purpose, dignity, choice

and respect• Services include:

• Accommodation• Hospitality• Health

Northumberland Parmamedics• Provides land ambulance services within the County• Transports those in need of further medical care to appropriate medical facilities• Ensures that all Paramedics maintain current health care skills to ensure quality of

care and continuous improvement• Delivers community programs to educate the public on the use of Emergency

Medical Services and 911, as well as the Northumberland Paramedics

Transportation, Waste & Facilities• Maintains County roads, bridges, culverts and drainage systems• Implements all Capital building projects• Responsible for the collection, processing and disposal of waste and recyclables

(including yard waste, household hazardous waste and electronic waste)• Services include maintenance and operation of:

• the Material Recovery Facility (MRF)• 2 waste transfer stations• 1 operational landfill site• 8 closed landfill sites

• Leads the oversight of all County-owned facilities including buildings, infrastructure and grounds

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This is Northumberland County’s sixth Annual Report, and it is once again my pleasure to share the Audited Financial Statements for the organization for the year ending December 31, 2018. This report captures progress on key initiatives over the last year as well as related financial results, ascribing context to some complex numbers. On the whole, it reflects the strong governance and progressive financial practices that continue to characterize County operations. Northumberland County’s rigorous financial management processes include a mix of internal controls, external audits, and business planning and financial reporting. Budget planning for each year is a six-month cycle that begins with staff seeking Council direction for a target base levy increase. In

June 2017, a target of 2 per cent was set for both the 2018 Budget and our long-term financial planning model. Relentlessly in pursuit of efficiencies, staff was pleased to deliver a base budget the following December that came in just slightly under this target at 1.91 per cent. Combined with a Dedicated Infrastructure Levy of 0.3 per cent, the total levy increase was 2.21 per cent. 2018 marked the eighth consecutive year of stable levy increases after more than a decade of volatility in the County tax rates. Our budget process continues to focus on long term financial needs and challenges within the model as opposed to just the current budget year in isolation. This ensures that the County is positioned to maintain service levels and fund future initiatives through stable modest levy increases over the long term, supporting predictability and affordability for residents, and contributing to overall quality of life.Strong financial frameworks and policies are at the root of the County’s ability to sustain key infrastructure, programs and supports, and deliver value to the people of Northumberland. 2018 results demonstrate that our balanced approach to program management and debt servicing, along with our

Director of Finance/Treasurer

TREASURER’S MESSAGE

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disciplined long-range planning, continue to generate financial stability for the organization. When looking at key indicators of our financial performance, we see that Net Financial Assets improved by 16 per cent over 2017, indicating continued improvement in liquidity and financial sustainability. Furthermore, growth has been consistent over the past eight years, thus eliminating a net liability position from 2010. 2018 also logged a continued positive trend of increased Accumulated Surplus, strengthening the stability of County reserves, the management of debt, expansion of capital assets and building financial capacity to address future needs. The net change in reserves from 2017 was an increase of $6 million. Annual reserve contributions aligned with long-term financial strategies occurred during the year, as did contributions for financing carry-over projects for continuation of works in future years. Reserves provide a critical resource for financing future project and infrastructure needs while minimizing levy fluctuations and future years’ debt servicing costs.Although long term debt overall decreased slightly by $600,000, there is unfinanced capital of $5.6 million

as represented in the Accumulated Surplus for ongoing works at the Brighton Landfill and construction of the Roseneath Emergency Services Base. This will be funded from debentures upon completion of the projects, as contemplated in the long-term financial model. These numbers are a measure of the County’s financial health to meet its existing and future financial obligations. While inflationary pressures, along with changes in funding allocations and grant availability from other levels of government, will require ongoing review and adaptation of the financial planning model to ensure fiscally responsible and sustainable operations over the long-term, the County is operating from a position of strength. On behalf of the Finance Team, I want to thank our internal and community partners and members of Council for their ongoing collaboration and support as we strive to achieve continuous improvement in our financial practices and deliver outcomes on strategic priorities.

Glenn DeesDirector of Finance/Treasurer


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Current & Future Projects

HIGHLIGHTS AND GOALS

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Economic prosperity and innovation• In partnership with the Town of Cobourg, developed an investment attraction

specialist position supporting manufacturing and business growth in Northumberland.• Supported 111 business start-ups through the Business and Entrepreneurship Centre

of Northumberland (BECN), creating 135 jobs in our community.• Implemented the Trail Town Initiative—a key component in growing the outdoor

recreation economy.• Updated the County Official Plan.• Within the first three months of staffing a Grant Writer position, coordinated the

development and submission of grant applications seeking more than $750,000 in funding from other levels of government, with expectations of delivering a minimum of $80,000 in funding for County programs and services for 2019.

• Implemented electronic procurement bid submissions, providing for a convenient, fast, secure and fully audited environment in which suppliers can upload bid documents.

• Fostered partnership between Ontario Works and Economic Development staff and Loyalist College to deliver the Elevate Plus pre-employment training program in Northumberland.

• Spearheaded a formal assessment of Northumberland County’s brand, involving an in-depth review of County materials and online presence, a review of comparator communities, and extensive public and stakeholder consultation as preliminary work for a broader brand strategy.

Key Accomplishments

2018 HIGHLIGHTS

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Sustainable infrastructure and services• Continued Natural Heritage surveys and research in the County Forest, including trail

use records, game cameras, breeding birds surveys and more.• Worked with the Cobourg Rotary Club to make the 2018 Ribfest “Zero Waste”,

diverting over four tonnes of recyclables and food waste from the landfill.• Secured approvals for upgrade work to the public drop-off areas at our landfill and

waste transfer stations, which will enable more waste materials—mattresses, asphalt shingles, construction waste, and wood waste—to be diverted from the landfill.

• Completed work on the relocation of historic waste from the unlined section of the Brighton Landfill and construction of the final engineered waste cell at the landfill.

• Commenced the detailed design and received approval for the construction of an Organic Waste Transfer Station at the Brighton Community Recycling Centre in 2019.

• Partnered with Alderville First Nation to provide waste management services including roadside collection services for the Alderville community.

• Successfully managed delivery of the 2018 Capital Program—17.5 km of pavement rehabilitation (including in-house detailed design for 1 km section of County Road 30) and 13 km of pavement preservation.

• Successfully delivered surface treatment program including 13.1 km of County roads and 127.9 km for member municipalities, for a total of 141 km of surface treatment.

• Completed the second phase of construction on the first section of County Road 2 (Elgin Street, Cobourg) from Strathy Road to Rogers Road, which included construction of a Multi-use Trail (MUT) on the south boulevard.

• Completed the selection process to secure a solution provider for the redesign of the Northumberland County website, and launched the project to deliver this new site.

• Completed preliminary detailed design for the redevelopment of the Golden Plough Lodge and Northumberland County Archives.

• Finalized construction and launched operations from the Roseneath Emergency Services Base—a new shared space for paramedic and fire services in Alnwick/Haldimand.

• Finalized agreement with the Municipality of Trent Hills for a shared emergency services base.

• Implemented GIS-centric asset management software for evaluating, prioritizing, scheduling, tracking operations, maintenance activities and costs.

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Thriving and inclusive communities• Increased accessibility at County facilities and housing buildings including the

addition of an accessible lift at the 112 Front Street housing unit in Campbellford and accessible/universal washrooms at Cobourg and Morganston Roads Depots.

• Collaborated with Cobourg Police Services to establish a data center in Venture13.• Developed a Post-Traumatic Stress Disorder (PTSD) Prevention Plan for

Northumberland Paramedics to support resilience and prevent psychological injury through peer support.

• Enhanced customer service for new Canadians by formalizing a Memorandum of Understanding with the New Canadian Centre to co-locate newcomer services at the County’s 600 William Street, Cobourg location.

• Hosted the first Oaktober event to raise awareness of the management of the Northumberland County Forest and the recreational opportunities in the forest.

• In partnership with Nogojiwanong Friendship Centre, Community & Social Services secured funding for an Indigenous Early Years Team, and launched the ‘Journey Together’ program in local EarlyON and child care centres.

• Collaborated with community partners to complete an enumeration of people experiencing homelessness in Northumberland. This data was used to develop the 2019 State of Homelessness in Northumberland County report.

• Implemented and oversaw the provincially and federally funded Social Infrastructure Fund — an investment of over $2 million in Northumberland from 2016-2019. In 2018, programming included the Housing Support Program, Renovate Northumberland and the completion of four homes through Habitat for Humanity Northumberland.

• County Council proclaimed September as “Hunger Action Month” in Northumberland. Community & Social Services released its first community Hunger Report and promoted the ‘30 Ways in 30 Days’ calendar to encourage participation in activities related to Hunger Action Month.

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Organizational excellence• Introduced a new power load stretcher system for Northumberland Paramedics to

reduce the strain on paramedics during calls and increase patient comfort and safety.• Completed a banking services Request for Proposals (RFP), realizing preferential

banking fees and interest rates.• Facilitated a long-term financial planning framework open house for enhanced

public engagement and input into budget and long-term financial priorities.• Continued to realize improved investment yields aligned with future years cash

flow requirements.• Northumberland Paramedics were recognized through The Ambulance Service

Review as standing out in Ontario for their quality processes.• Implemented IT infrastructure updates including a new mobile device management

solution, upgrades to the phone system infrastructure and network upgrades throughout County locations.

• Published the 2018 IT Strategy and enhanced IT security through the development of an IT Policy Framework, the initiation of a cybersecurity awareness training program for staff and the obtainment of a cybersecurity insurance for organization.

• As part of the County’s culture of continual improvement toward excellence, coordinated the organization’s second all-staff survey process to obtain feedback from employees about organizational performance and internal culture, as well as opportunities for improvement.

• Introduced the Musculoskeletal Disorders Program as required under the 2018/2019 Ministry of Labour initiative and in alignment with the Health and Safety Strategic Plan.

• Launched an online platform for staff to complete mandatory training requirements and self-directed professional development.

• Implemented and completed the 2016-2018 Golden Plough Lodge Staff Engagement Plan and identified initiatives successfully embedded in daily operations.

• Completed the 2018-2022 Golden Plough Lodge Strategic Plan and distributed to all consultative stakeholders.

• Increased on-site storage capacity from 190 to over 1,000 boxes at our 600 William Street location, reducing annual spending on third party storage contracts and improving staff access to these materials.

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Economic innovation and prosperity• Undertake a County-wide development charges background study. This study will

ensure future financing is available for incremental growth-driven infrastructure costs, such that growth pays for growth-related costs.

• Infrastructure investments to support economic renewal.• Continue to focus on workforce development and attraction.

Sustainable infrastructure and services• Complete the detailed design for Golden Plough Lodge and Archives Redevelopment• Construction of the Trent Hills Emergency Services Base in Campbellford, estimated

to complete in June 2020.• Initiate year-round access to household hazardous waste and electronic waste

disposal at the Brighton and Bewdley Community Recycling Centres (CRC) and add a diversion program at the CRCs for bulky Styrofoam in April 2019.

• Implement the Green Bin organics waste collection program and transition to a dual-stream recycling collection program in September 2019.

• Develop and launch a County-wide Digital Strategy.• Launch the new Northumberland.ca website on-time and on-budget.• Finalize the Forest Master Plan.• Improve accessibility of collection through digitization initiatives, creation of finding

aids, and continue inventory and arrangement.• Retain GHD to commence the Detailed Design for the Campbellford Bridge project.• Construction of two joint projects including a Multi-Use Trail (MUT) on Elgin Street in

partnership with the Town of Cobourg, and the construction of a pedestrian link on Molson/Jocelyn/Cavan Street in partnership with the Municipality of Port Hope.

• Complete the County Road 2 Master Drainage Plan Study in partnership with the Town of Cobourg, Hamilton Township and the Ganaraska Region Conservation Authority (GRCA) as per the recommendation in the County Road 2 Environmental Assessment.

Key Initiatives

LOOKING AHEAD TO 2019

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• Complete the 2019 Capital Pavement Rehabilitation and Preservation Program.• Retain AECOM to commence development of a business case/economic impact

study for the expansion of GO services to Northumberland County, with anticipated completion of the study in 2020.

• Prepare and submit a joint funding application to the Investing in Canada Infrastructure Program (ICIP): Rural & Northern Stream with the Township of Cramahe and the Municipality of Brighton for the relocation of the Emergency Detour Route (EDR) in the eastern portion of the County.

• Finalize the design for safety improvements at the County Road 64 at-grade railway crossing in the Municipality of Brighton and submit to Transport Canada for funding to implement improvements.

Thriving and inclusive communities• Improve access to paramedicine in rural Northumberland.• Development and completion of a Golden Plough Lodge Diversity Plan; examining,

planning and addressing the needs of our current and future resident population.• Explore and implement additional enhanced, specialized in-house clinical care and

family services and supports at the Golden Plough Lodge.• Finalize the County Affordable Housing Strategy and present to councils in member

municipalities.• Renovate the Grafton Community Centre to accommodate a new EarlyON Child

and Family Centre and a Family Age Grouping Child Care Centre with 15 spaces. This Community Based Capital Project is supported with funding from the Ministry of Education, and in partnership with the Township of Alnwick/Haldimand.

• Build capacity across agencies in Northumberland to help build sustainable tenancies through the launch of the RentSmart program.

Organizational excellence• Establish strategic asset management policies aligned with municipal asset

management planning policy regulations.• Improve access to paramedic call data for accurate needs analysis.• IT security enhancements in both the County and member municipality IT infrastructures.• IT infrastructure updates including Office 365 and Windows 10 upgrades and the

implementation of a new Human Resources Information System (HRIS) solution.• Design a Public Engagement Protocol, creating consistency of practice across the

organization.• Create a Corporate Communications Strategy aligned with 2019-2023 Council

Strategic Plan.• In alignment with the Health and Safety Strategic Plan, expand Hazard Identification

Risk Assessment to other services for corporate due diligence.

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2018 Community Engagement

IN THE COMMUNITY

Northumberland Paramedics at Big Brothers and Big Sisters of Northumberland ball game

Council enjoying Smile Cookies in support of Ed’s House, Northumberland Hospice Care Centre

County staff support Keep the County Clean

AED program with Town of Cobourg

Ambulance donation to OCEAP

Recycling facility Community BBQ

Go for Gold dress down day in support of NHCC

Local Government Week Educational Activities

Oaktober County Forest community event

Council in purple for Child Abuse Prevention Month

County staff team at NHH Colour Run

Paramedics Community Awards and BBQ

Take Our Kids to Work Day

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2018 Financial Report

FINANCIALOVERVIEW

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County business planningThe County goes through a rigorous budgeting and planning process each year. Each operating department develops an annual business plan that is aligned with the County’s Corporate Strategic Plan. This process looks at programs and services, budgets and key priorities for the year. In addition to the annual budget, the long term plan is reviewed and updated to create a rolling 10-year financial outlook.

Financial statement preparationNorthumberland County management is responsible for all information contained in the Annual Financial Report. These financial statements and accompanying notes have been prepared using reasonable limits of materiality and within the framework of the accounting principles and disclosure requirements of the Canadian Institute of Chartered Accountants guidelines included in the Public Sector Accounting and Auditing Standards Manual.

The Process

FINANCIAL MANAGEMENT

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Internal control managementManagement maintains appropriate systems of internal and administrative controls designed to provide reasonable assurance that transactions are executed with proper authorization, that assets are properly accounted for and safeguarded, and that the financial information produced is relevant, reliable and timely.

External auditThe role of the external auditor, Baker Tilly KDN LLP, is to express an independent opinion on the fair presentation of the County’s financial position and operating results as contained in the Financial Statements, confirming that the statements are free from material misstatements. It is the responsibility of the auditor to advise management and the Finance Department Coordinators of any control or operational issues that may be identified during the execution of their audit procedures.

Financial reportingTo ensure accountability and transparency, the Finance Director and Treasurer presents quarterly updates to Council on the status of County finances relative to the current budget. County auditors, together with the Finance Director/Treasurer, present to Council the final annual Audited Financial Statement for the County, for Council approval, closing out the previous fiscal year.

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Financial Results Overview

Financial assets

$6.0MReserves

$0.6MLong-Term Debt

$0.5MCash & Investments

$10.2MNet book value of assets

$7.2MTotal Revenue

* All comparative data references 2017 results.

Expenses

$6.8MAnnual overview

The County is now in a positive net financial asset position of $16.7 million.

Assets

Liabilities

2013$7M

2014 $3M

2015 $1.8M

2016 $8.3M

2017 $14.4M

2018 $16.7M

30

*Percentages may not add up to 100 due to decimal point rounding.*Health services: Northumberland Paramedics and Health Unit funding. Environmental services: waste management. Protection services: Provincial Offences, Court Security, Plumbing and Septic Inspections, and Emergency Planning. General government: Corporate Support departments and facilities, MPAC payment, and Council.

40%

25%

18%

9% 8%

0.3% 0.2%

Salaries & Benefits $40.6External Transfers $25.7Materials $17.9Contracted Services $8.8Amortization $8.4Interest Charges $0.3Rents & Financial $0.2

Expenses by type (m)

10%

33%

48%

3% 2% 1% 1% 0.09%1%

Tax Levy $54.3Provincial Government $38User Charges $11.2Federal Government $3.8 Rents $2.5Other Municipalities $1.6Provincial Offences $1.4Investment Income $1.1Other $0.1

Revenues by type (m)

Social & Family Services $36.4Transportation $16.1Health Services $14.4Social Housing $12.9Environmental Services $10.5General Government $4.5Ec. Development/Tourism/Forest $4.0Protection Services $3.1

Expenses by service (m)36%

16%14% 13%

10%

4% 4% 3%

31

2018 Audited Statements

FINANCIAL STATEMENTS

CORPORATION OF THE COUNTY OFNORTHUMBERLAND

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2018

CORPORATION OF TH E COUN TY OFNORTHUMBERLAND

CONSOLIDA TED FINANCIAL STATEMENTS

DECEMBER 31, 2018

CORPORATION OF THE COUNTY OF NORTHUMBERLAND


DECEMBER 31, 2018

TABLE OF CONTENTSPage

Number

MANAGEMENT REPORT

INDEPENDENT AUDITOR'S REPORT


Statement of Financial Position 1

Statem ent of Operations and Accumulated Surplus 2

Statem ent of Change in Net Financial Asset s 3

Statement of Cash Flows 4

Notes to the Financial Statements 5 - 17

Schedule of Tangible Capital Assets 18

Schedules of Segment Disclosure 19 - 20

TRUST FUNDS

Independent Auditor's Report 21

Statement of Financial Position 23

Statement of Continuity 23

Notes to the Financial Statements 24

Baker Tilly KDN LLP272 Charlotte St.Peterborough, ONCanada K9J 2V4

T: (705) 742-3418F: (705) 742-9775

www.bakertilly.ca


To the Members of Council, Inhabitants and Ratepayersof the Corporation of the County of Northumberland

OpinionWe have audited the consolidated financial statements of the Corporation of the County ofNorthumberland (the County), which comprise the consolidated statement of financial position as atDecember 31, 2018, the consolidated statements of operations and accumulated surplus, change in netfinancial assets and cash flows for the year then ended, and notes to the consolidated financialstatements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements present fairly, in all materialrespects, the consolidated financial position of the County as at December 31, 2018, and the results of itsconsolidated operations and its consolidated cash flows for the year then ended in accordance withCanadian Public Sector Accounting Standards.

We conducted our audit in accordance with Canadian generally accepted auditing standards. Ourresponsibilities under those standards are further described in the Auditor's Responsibilities for the Auditof the Consolidated Financial Statements section of our report. We are independent of the County inaccordance with the ethical requirements that are relevant to our audit of the consolidated financialstatements in Canada, and we have fulfilled our other ethical responsibilities in accordance with theserequirements. We believe that the audit evidence we have obtained is sufficient and appropriate toprovide a basis for our opinion.

Responsibilities of Management and Those Charged with Governance for the Consolidated FinancialStatementsManagement is responsible for the preparation and fair presentation of the consolidated financialstatements in accordance with Canadian Public Sector Accounting Standards, and for such internalcontrol as management determines is necessary to enable the preparation of consolidated financialstatements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing theCounty's ability to continue as a going concern, disclosing, as applicable, matters related to goingconcern and using the going concern basis of accounting unless management either intends to liquidatethe County or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the County's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial StatementsOur objectives are to obtain reasonable assurance about whether the consolidated financial statementsas a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor'sreport that includes our opinion. Reasonable assurance is a high level of assurance, but is not aguarantee that an audit conducted in accordance with Canadian generally accepted auditing standardswill always detect a material misstatement when it exists. Misstatements can arise from fraud or errorand are considered material if, individually or in the aggregate, they could reasonably be expected toinfluence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the consolidated financial statements,

whether due to fraud or error, design and perform audit procedures responsive to those risks, andobtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk ofnot detecting a material misstatement resulting from fraud is higher than for one resulting fromerror, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or theoverride of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the County's internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accountingand, based on the audit evidence obtained, whether a material uncertainty exists related to eventsor conditions that may cast significant doubt on the County's ability to continue as a going concern.If we conclude that a material uncertainty exists, we are required to draw attention in our auditor'sreport to the related disclosures in the consolidated financial statements or, if such disclosures areinadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up tothe date of our auditor's report. However, future events or conditions may cause the County tocease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the consolidated financial statements,including the disclosures, and whether the consolidated financial statements represent theunderlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the consolidated financial information of theentities or business activities within the County to express an opinion on the consolidated financialstatements. We are responsible for the direction, supervision and performance of the group audit.We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the plannedscope and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.

Baker Tilly KDN LLPChartered Professional AccountantsLicensed Public Accountants

Peterborough, OntarioMay 28, 2019

CORPORATION OF THE COUNTY OFNORTHUMBERLANDCONSOLIDATED STATEMENT OF FINANCIAL POSITIONAt December 31, 2018

2018 2017$ $

FINANCIAL ASSETSCash 7,044,098 14,069,699Investments (note 5) 49,246,911 41,681,076Accounts receivable 5,065,680 2,848,837

TOTAL FINANCIAL ASSETS 61,356,689 58,599,612

LIABILITIESAccounts payable and accrued liabilities 13,693,542 11,173,044Deferred revenue - Federal gas tax (note 6) - 169,121Long term debt (note 7) 7,669,782 8,241,415Landfill closure and post-closure liability (note 8) 21,255,900 22,759,988Employee future benefits liability (note 9) 2,033,761 1,818,995

TOTAL LIABILITIES 44,652,985 44,162,563

NET FINANCIAL ASSETS 16,703,704 14,437,049

NON-FINANCIAL ASSETSTangible capital assets (note 10) 172,613,862 162,459,630Prepaid expenses 277,430 254,633

TOTAL NON-FINANCIAL ASSETS 172,891,292 162,714,263

ACCUMULATED SURPLUS (note 11) 189,594,996 177,151,312

The accompanying notes are an integral part of these financial statements

1

CORPORATION OF THE COUNTY OFNORTHUMBERLANDCONSOLIDATED STATEMENT OF OPERATIONS AND ACCUMULATED SURPLUSFor the Year Ended December 31, 2018

Budget Actual Actual2018 2018 2017

$ $ $(Unaudited)

REVENUESTax levy from lower tiers 54,264,162 54,341,442 52,752,529User charges 10,826,703 11,168,371 11,573,080Government of Canada 983,285 983,284 1,081,184Province of Ontario 34,421,550 36,928,470 31,910,221Other municipalities 1,272,753 1,583,621 1,284,587Investment income 850,000 1,109,310 880,169Provincial Offences Act charges (note 12) 1,430,000 1,410,326 1,957,067Rents 2,355,582 2,456,962 2,331,659Federal gas tax earned 2,364,412 2,772,091 2,526,584Waste Diversion Ontario grants 1,060,000 1,033,657 1,133,282Other 160,600 125,778 58,043Donations 15,000 21,454 12,951Gain (loss) on disposal of tangible capital assets - 372,079 (435,464)

TOTAL REVENUES 110,004,047 114,306,845 107,065,892

EXPENSESGeneral government 4,134,690 4,454,322 3,388,169Protection services 3,447,221 3,134,726 3,647,266Transportation services 17,431,345 16,092,464 15,548,091Environmental services 12,842,352 10,509,106 12,003,674Health services 14,317,974 14,376,588 13,689,745Social and family services 35,280,259 36,434,367 32,109,954Social housing 12,308,408 12,853,765 10,969,225Economic development, tourism and forest 4,068,316 4,007,823 3,717,422

TOTAL EXPENSES 103,830,565 101,863,161 95,073,546

ANNUAL SURPLUS 6,173,482 12,443,684 11,992,346

ACCUMULATED SURPLUS - beginning of year 177,151,312 165,158,966

ACCUMULATED SURPLUS - end of year 189,594,996 177,151,312


2

CORPORATION OF THE COUNTY OFNORTHUMBERLANDCONSOLIDATED STATEMENT OF CHANGE IN NET FINANCIAL ASSETSFor the Year Ended December 31, 2018


$ $ $(Unaudited)

ANNUAL SURPLUS 6,173,482 12,443,684 11,992,346

Amortization of tangible capital assets 8,600,000 8,443,738 8,737,681Purchase of tangible capital assets (21,723,400) (18,249,196) (15,219,805)Loss/(gain) on disposal of tangible capital assets - (372,079) 435,464Proceeds on sale of tangible capital assets - 23,305 137,536Change in prepaid expenses - (22,797) 30,385

INCREASE/(DECREASE) IN NET FINANCIAL ASSETS (6,949,918) 2,266,655 6,113,607

NET FINANCIAL ASSETS - beginning of year 14,437,049 14,437,049 8,323,442

NET FINANCIAL ASSETS - end of year 7,487,131 16,703,704 14,437,049


3

CORPORATION OF THE COUNTY OFNORTHUMBERLANDCONSOLIDATED STATEMENT OF CASH FLOWSFor the Year Ended December 31, 2018

2018 2017$ $

CASH PROVIDED BY (USED IN)

OPERATING ACTIVITIESAnnual surplus 12,443,684 11,992,346Items not involving cash

Amortization of tangible capital assets 8,443,738 8,737,681Loss/(gain) on disposal of tangible capital assets (372,079) 435,464Change in landfill closure and post-closure liability (1,504,088) (199,129)Change in employee future benefits liability 214,766 (22,730)

Change in non-cash assets and liabilitiesAccounts receivable (2,216,843) 2,044,262Prepaid expenses (22,797) 30,385Accounts payable and accrued liabilities 2,520,498 (1,016,784)Deferred revenue - Federal gas tax (169,121) 1,340

Net change in cash from operating activities 19,337,758 22,002,835

CAPITAL ACTIVITIESPurchase of tangible capital assets (18,249,196) (15,219,805)Proceeds on disposal of tangible capital assets 23,305 137,536

Net change in cash from capital activities (18,225,891) (15,082,269)

INVESTING ACTIVITIESPurchase of investments (30,547,598) (18,194,361)Disposal of investments 22,981,763 25,678,386

Net change in cash from investing activities (7,565,835) 7,484,025

FINANCING ACTIVITIESLong term debt issued 649,217 3,699,307Debt principal repayments (1,220,850) (6,903,285)

Net change in cash from financing activities (571,633) (3,203,978)

NET CHANGE IN CASH (7,025,601) 11,200,613

CASH - beginning of year 14,069,699 2,869,086

CASH - end of year 7,044,098 14,069,699


4

CORPORATION OF THE COUNTY OFNORTHUMBERLANDNOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSFor the Year Ended December 31, 2018

The County of Northumberland is an upper tier municipality in the Province of Ontario, Canada. Itconducts its operations guided by the provisions of provincial statutes such as the Municipal Act,Municipal Affairs Act and related legislation.

1. SIGNIFICANT ACCOUNTING POLICIES

These consolidated financial statements have been prepared in accordance with the standards inthe Chartered Professional Accountants Canada Public Sector Accounting (PSA) Handbook.Significant aspects of the accounting policies are as follows:

(a) Reporting Entity

These consolidated financial statements reflect the assets, liabilities, revenues and expensesand accumulated surplus of the reporting entity.

The reporting entity is comprised of all organizations, committees and local boards accountablefor the administration of their financial affairs and resources to the County and which areowned and controlled by the County. These consolidated financial statements include:

• Northumberland County Housing Corporation

All interfund assets and liabilities and revenues and expenses are eliminated.

(b) Tangible Capital Assets

Tangible capital assets are recorded at cost which includes all amounts that are directlyattributable to acquisition, construction, development or betterment of the asset. The cost, lessresidual value, if any, of tangible capital assets is amortized on a straight-line basis,commencing in the year of acquisition except for road surface betterments where amortizationcommences in the year following construction, over the expected useful life of the asset, asfollows:

Land improvements 10 yearsBuildings 50 yearsRoads and bridges 20 to 75 yearsEquipment and computers 5 to 20 yearsVehicles 5 to 10 years

Tangible capital assets received as contributions are recorded at their fair value at the date ofreceipt and are also recorded as revenue.

Tangible capital assets categorized as assets under construction are not amortized until theyare put into service.

(c) Non-financial Assets

Tangible capital and other non-financial assets are accounted for as assets by the Countybecause they can be used to provide services in future periods. These assets do not normallyprovide resources to discharge the liabilities of the County unless they are sold.

(d) Reserves and Reserve Funds

Certain amounts, as approved by Council, are set aside in reserves and reserve funds forfuture operating and capital purposes. Transfers to and/or from reserves and reserve funds arean adjustment to the respective fund when approved.

5


1. SIGNIFICANT ACCOUNTING POLICIES, continued

(e) Recognition of Revenues and Expenses

Revenues and expenses are reported on the accrual basis of accounting. The accrual basis ofaccounting recognizes revenues in the period in which the transactions or events occurred thatgive rise to the revenue; expenses are recognized in the period the goods or services areacquired and a legal liability is incurred or transfers are due.

Taxation

The County establishes the tax rates annually based on the amount required to be raised.These tax rates are used to levy amounts to the lower tier municipalities are based ontheir annual assessment. Adjustments to the lower tier levy amounts for additions to andreductions in assessment are reported in the consolidated financial statements whenamounts can be reasonably determined.

Government Funding and other grants

Government funding and other grants are recognized in the financial statements asrevenues in the period in which events giving rise to the transfers occur, providing thetransfers are authorized, any eligibility criteria have been met, and reasonable estimatesof the amounts can be made.

Other revenue

Fines levied under the Provincial Offenses Act 1997 are recognized when the funds arereceived. (see note 12).

User charges and rents are recognized as revenue in the year the goods and services areprovided, with the exception of permits that are recognized when the permits are issued.

(f) Use of Estimates

Certain items recognized in the consolidated financial statements are subject to measurementuncertainty. The recognized amounts of such items are based on the County's best informationand judgment. By their nature, these estimates are subject to measurement uncertainty and theeffect on the consolidated financial statements or changes in such estimates in future periodscould be significant. The County's significant estimates include:

• The amounts recorded for landfill closure and post-closure care depend on estimatesof usage, remaining life and capacity. The provision for future closure and post-closurecosts also depends on estimates of such costs;

• The amounts recorded for amortization and opening costs of tangible capital assets arebased on estimates of useful life, residual values and valuation rates;

• The values of employee future benefits depend on certain actuarial and economicassumptions; and

• The amount recorded as allowance for doubtful accounts receivable is based onmanagement's estimate of future payments on receivable account balances.

6


1. SIGNIFICANT ACCOUNTING POLICIES, continued

(g) Trust Funds

Trust funds and their related operations administered by the County are not included in theseconsolidated financial statements but are reported on separately on the Trust Funds Statementof Continuity and Statement of Financial Position.

2. TRUST FUNDS

Trust funds administered by the County amounting to $143,602 (2017 - $151,365) have not beenincluded in the Consolidated Statement of Financial Position nor have their operations beenincluded in the Consolidated Statement of Operations and Accumulated Surplus. As such balancesare held in trust by the County for the benefit of others, they are not presented as part of theCounty's financial position or operations.

3. CHANGES IN ACCOUNTING POLICIES

The County has implemented the following PSA sections which are now effective under the PSAHandbook: 3320 Contingent Assets, 3380 Contractual Rights, 2200 Related Party Disclosures and3420 Inter-Entity Transactions.

Under Section 3320, a contingent asset is a potential asset that exists at the financial statementdate but requires confirmation or disproval at a future date that is not in the control of the public-sector entity. If the contingent asset is deemed to be likely to exist, then this should be disclosed inthe notes to the financial statements. Disclosure should include the nature, extent (except in thosecases where extent cannot be measured or disclosure would have an adverse effect on theoutcome), the reason for any non-disclosure of extent, and when an estimate of the amount hasbeen made, the basis for that estimate. This section has been applied prospectively. The adoptionof this standard did not have an impact on the County's consolidated financial statements.

Under Section 3380, a contractual right arises out of a contract or agreement where it will result inthe County having both an asset and future revenue. The contract or agreement must be betweentwo or more parties and be enforceable under contract law. Contractual rights are assets andrevenues that will occur in the future due to an enforceable agreement in effect at the financialstatement date. If a contractual right exists, it should be disclosed in the notes or schedules to thestatements and include descriptions about nature, extent and timing. This section has been appliedprospectively. The adoption of this standard did not have an impact on the County's consolidatedfinancial statements.

Section 3240 establishes the standards and requirements on how to account for and Section 2200establishes the standards and requirements on how to report transactions between public sectorentities that comprise the government’s reporting entity. These sections have been appliedretroactively with restatement of prior periods. The adoption of these standards did not have animpact on the County's consolidated financial statements.

4. CREDIT FACILITY AGREEMENT

The County has a revolving credit facility agreement with its main financial institution. The amountavailable at any time is limited to $10,000,000 via an operating loan. Any balance borrowed willaccrue interest at the bank’s prime lending rate less 1.0% per annum. Council authorized thetemporary borrowing limit by by-law 2018-05. At December 31, 2018 there was no balanceoutstanding (2017 - $Nil).

7


5. INVESTMENTS

2018 2017$ $

ONE Investment high interest savings account 23,005,000 -Renaissance high interest savings account. 474,312 194,849GIC's bearing interest rates between 1.54% and 1.62%, maturing

between February 27, 2018 and April 16, 2018. - 16,000,000Corporate bonds bearing interest rates between 1.8% and 3.45%,

maturing between May 15, 2019 and April 4, 2028. 25,767,599 25,486,227

49,246,911 41,681,076

6. DEFERRED REVENUE - OBLIGATORY RESERVE FUNDS

A requirement of the Chartered Professional Accountants Canada Public Sector AccountingHandbook, is that obligatory reserve funds be reported as deferred revenue. This requirement is inplace as legislation and external agreements restrict how these funds may be used and undercertain circumstances these funds may possibly be refunded. The balance in the obligatory reservefunds of the County is summarized below:

2018 2017$ $

Federal gas tax - 169,121

The continuity of deferred revenue - obligatory reserve funds is as follows:

2018 2017$ $

Balance - beginning of year 169,121 167,781

Add amounts received:Federal gas tax 2,600,853 2,526,584Interest 2,117 1,340

2,602,970 2,527,924

Less transfer to operations:Federal gas tax earned 2,772,091 2,526,584

Balance - end of year - 169,121

8


7. LONG TERM DEBT

(a) The balance of long term debt reported on the Consolidated Statement of Financial Position ismade up of the following:

2018 2017$ $

Ontario Infrastructure and Lands Corporation due December 3,2023, repayable in blended semi annual instalments of $70,528,and bears interest at 3.07% per annum. 649,217 -

Ontario Strategic Infrastructure Financing Authority due March 15,2028, repayable in blended semi annual instalments of $89,862and bears interest at 4.92% per annum. 1,350,913 1,460,126

Ontario Infrastructure Projects Corporation due March 1, 2019,repayable in blended semi annual instalments of $127,039 andbears interest at 4.37% per annum. 124,323 365,049

Ontario Infrastructure Projects Corporation due September 1, 2022,repayable in blended semi-annual instalments of $266,865 andbears interest of 2.27% per annum. 2,029,878 2,509,351

Ontario Infrastructure Projects Corporation due September 15,2019, repayable in blended semi annual instalments of $35,104and bears interest at 4% per annum. 68,156 133,666

Ontario Infrastructure Projects Corporation due September 4, 2035,repayable in blended semi annual instalments of $90,923 andbears interest at 4.51% per annum. 2,142,972 2,225,372

Ontario Infrastructure Projects Corporation due May 4, 2020,repayable in blended semi annual instalments of $76,095 andbears interest at 4.15% per annum. 219,130 357,894

Ontario Infrastructure Projects Corporation due September 1, 2027,repayable in blended semi-annual instalments of $68,560 andbears interest of 2.78% per annum. 1,085,193 1,189,957

7,669,782 8,241,415

(b) The long term debt in (a) issued in the name of the County have been approved by by-law. Theannual principal and interest payments required to service these liabilities are within the annualdebt repayment limit prescribed by the Ministry of Municipal Affairs and Housing.

(c) Interest paid during the year on long term debt amounted to $288,047 (2017 - $468,115).

9


7. LONG TERM DEBT, continued

(d) The long term debt reported in (a) of this note is repayable as follows:

Principal Interest Total$ $ $

2019 1,258,041 264,874 1,522,9152020 1,023,155 226,417 1,249,5722021 977,153 196,324 1,173,4772022 1,006,654 166,823 1,173,4772023 500,387 139,360 639,747

4,765,390 993,798 5,759,1882024 to 2028 1,823,155 443,319 2,266,4742029 and subsequent years 1,081,237 191,685 1,272,922

7,669,782 1,628,802 9,298,584

8. LANDFILL CLOSURE AND POST-CLOSURE LIABILITY

The liability for landfill closure and post-closure costs of $21,255,900 (2017 - $22,759,988) has beenestimated using discounted future cash flows associated with closure and post-closure careactivities for the County’s one operational site and the nine closed sites that the County hasobtained from the lower tier municipalities by way of a settlement process (see Note 17). Theclosure costs include final cover, vegetation and additional monitoring wells. Post-closure costsinclude monitoring, maintenance of control systems and consulting fees for at least 25 years afterthe site is closed. The landfill closure and post-closure liability will be funded from taxation. Thereare no specific assets designated for settling this liability.

The reported liability is based upon estimates and assumptions with respect to events extendingover the remaining life of the landfill. The total discounted future cash flows for closure and post-closure cost is estimated at $25,592,387 as at December 31, 2018 (2017 - $26,148,323) using adiscount factor of 4% and an inflation rate of 2%.

The remaining capacity of the one operational landfill site is estimated at 444,997 m3 (2017 -403,580 m3) which is 48.7% (2017 - 44.1%) of the site’s total capacity. The remaining capacity ofthe operational landfill increased in 2018 due to revised estimated based on a new survey of thesite. The County estimates the site will continue to operate until 2030.

10


9. EMPLOYEE FUTURE BENEFITS LIABILITY

Under the Workplace Safety and Insurance Board (WSIB), the County is self-insured (Schedule II)and remits payments to the WSIB as required to fund disability payments. The liability recorded of$2,033,761 (2017 - $1,818,995) has been determined by an actuarial review completed as ofDecember 31, 2017. This liability is fully funded by a reserve set aside for this purpose andreported as part of the employee health, safety and related costs reserve as reported in theAccumulated Surplus note.

The liability is comprised of the following amounts:

2018 2017$ $

Accrued benefit obligation 2,330,513 1,355,218Unamortized actuarial gains/(losses) (296,752) 463,777

2,033,761 1,818,995

The actuarial report for the WSIB liability was based on the following assumptions:

Interest discount rate 3.75%WSIB administration and physician fees 38% of benefit costsExpected level of employee cost increases 1.01%Expected average remaining service life 9.96 years

The continuity of the WSIB liability is as follows:

2018 2017$ $

Accrued benefit obligation at January 1 2,136,132 1,320,241Unamortized actuarial gains/(losses) (317,137) 521,484

Liability at January 1 1,818,995 1,841,725Increase due to plan amendment 16,959 -Current year benefit cost 380,739 176,915Interest 82,521 55,671Amortization of actuarial loss/(gain) (amortized over

the expected average remaining service life) 20,385 (57,707)Less: benefit payments (285,838) (197,609)

Liability at December 31 2,033,761 1,818,995

11


10. TANGIBLE CAPITAL ASSETS

The net book value of the County's tangible capital assets are:

2018 2017$ $

GeneralLand 14,127,981 14,045,181Land improvements 3,520,637 3,122,468Buildings 23,627,018 24,262,212Equipment and computers 6,927,129 6,548,285Vehicles 5,992,871 5,947,065

InfrastructureRoads and bridges 103,005,190 98,150,655

157,200,826 152,075,866

Assets under construction 15,413,036 10,383,764

172,613,862 162,459,630

For additional information, see the Consolidated Schedule of Tangible Capital Assets.

During the year there were no write-downs of assets (2017 - $Nil) and no interest capitalized (2017- $Nil).

Tangible capital assets allocated by segment are as follows:

2018 2017$ $

General government 17,567,789 14,413,723Protection services 119,956 129,352Transportation services 109,304,194 105,968,321Environmental services 31,632,538 27,718,551Health services 1,660,134 1,057,539Social and family services 2,349,189 1,909,127Social housing 7,013,951 7,969,979Economic development, tourism and forest 2,966,111 3,293,038

172,613,862 162,459,630

12


11. ACCUMULATED SURPLUS

(a) Accumulated surplus consists of the following:

2018 2017$ $

Surplus/(Deficit)Unfunded landfill closure and post-closure liability (21,255,900) (22,759,988)Unfunded employee future benefits liability (2,033,761) (1,818,995)

(23,289,661) (24,578,983)

Invested In Capital AssetsTangible capital assets - net book value 172,613,862 162,459,630Long term debt (7,669,782) (8,241,415)Unfunded capital (b) (5,579,933) -

159,364,147 154,218,215

Surplus 136,074,486 129,639,232

ReservesWorking funds 821,274 821,278Corporate services 12,303,006 10,528,431Transportation services 8,535,169 6,348,247Waste services 4,272,470 3,548,847Social services 726,903 724,500Social housing 11,027,006 10,860,460Golden Plough Lodge 6,001,408 5,218,152Ambulance services 1,731,318 1,590,559Technological development 1,168,773 939,057Emergency planning 290,050 280,050Employee health, safety and related costs 4,221,505 4,189,115Facilities 1,655,398 1,828,639Economic development, tourism and forest 341,924 352,424Plumbing and septic inspections 191,717 132,321Land use planning 232,589 150,000

Total Reserves 53,520,510 47,512,080

189,594,996 177,151,312

(b) Unfunded capital amounts are for projects in progress. When the projects are complete, theamounts will be funded with long term debt.

13


12. PROVINCIAL OFFENCES OFFICES

As a result of the provincial-municipal restructuring under Bill 108, streamlining of administration ofProvincial Offences Act (“POA”) 1997, the County has assumed responsibility and administration ofthe POA office and courts.

Revenues from the POA office consists of fines levied under Part I and III (including delaypenalties) for POA charges filed at 860 William Street in Cobourg. Offenders may pay their fines atany court office in Ontario, at which time, their receipt is recorded in the Integrated CourtsOperations Network system (“ICON”) operated by the Province of Ontario. The County ofNorthumberland recognizes fine revenue when the receipt of funds is recorded by ICON andmatched to the offence notice, regardless of the location where payment is made.

Revenues and expenses related to these operations have been reported as follows:

2018 2017$ $

Gross revenues 1,410,326 1,957,067Operating costs and allocated charges (1,148,567) (1,179,444)

Net County revenue used to reduce tax levy 261,759 777,623

13. EXPENSES BY OBJECT

The expenses for the year reported on the Consolidated Statement of Operations and AccumulatedSurplus by object are as follows:


$ $ $(Unaudited)

Salaries and benefits 40,651,018 40,636,877 38,038,992Interest charges 297,647 288,047 468,115Materials 17,142,035 17,866,074 17,102,323Contracted services 13,214,880 8,803,906 9,511,774Rents and financial 158,743 161,347 180,802External transfers 23,766,242 25,663,172 21,033,859Amortization 8,600,000 8,443,738 8,737,681

103,830,565 101,863,161 95,073,546

14


14. BUDGET FIGURES

The budget, approved by the County, for 2018 is reflected on the Consolidated Statement ofOperations and Accumulated Surplus and the Consolidated Statement of Change in Net FinancialAssets. The budget established for capital investment in tangible capital assets are on a project-oriented basis, the costs of which may be carried out over one or more years and, therefore, maynot be comparable with current year’s actual amounts. Budget figures have been reclassified for thepurposes of these financial statements to comply with PSA reporting requirements. Budget figuresare not subject to audit.

The following is a reconciliation of the Council approved budget amounts to the PSA amounts:

(Unaudited) (Unaudited)Revenue Expenses

$ $

Council approved budget:Operating and capital 119,756,666 119,756,666

Total Council approved budget 119,756,666 119,756,666

Less: Tangible capital assets capitalized - (21,723,400)Add: Amortization of tangible capital assets - 8,600,000Add: Long term debt proceeds (expense reduction in budget) - 7,250,000Less: Principal repayment of long term debt - (1,281,650)Less: Net transfers to/from reserves - 181,568Less: Change in unfunded liabilities - 800,000Less: Interdepartmental charges (9,439,618) (9,439,618)Revenues and expenses netted for financial reporting (313,001) (313,001)

Adjusted budget per Consolidated Statement of Operations 110,004,047 103,830,565

15. PENSION AGREEMENTS

Certain employees of the County are eligible members of the Ontario Municipal EmployeesRetirement System (OMERS), a multi-employer pension plan.

The Actuarial Opinion contained in the 2018 Annual Report disclosed total actuarial liabilities of$100,081 million in respect of benefits accrued for service with actuarial assets of $95,890 millionindicating an actuarial deficit of $4,191 million. Because OMERS is a multi-employer plan, anypension plan surpluses or deficits are a joint responsibility of Ontario municipal organizations andtheir employees. As a result, the County does not recognize any share of the OMERS pensionsurplus or deficit.

The County's required contributions to OMERS in 2018 were $2,511,492 (2017 - $2,361,009).

16. CONTINGENT LIABILITIES

The County, in the course of its operations, has been named in several lawsuits the outcomes ofwhich are indeterminable at this time. No amounts in connection with these items have beenreflected in these financial statements.

15


17. COMMITMENTS

The County assumed the assets and liabilities of the waste management systems of the lower tiermunicipalities on January 1, 1991 according to by-law 24-90. This by-law was passed pursuant tosubsection 209(a) of the Municipal Act of the Province of Ontario which required the County to payor to receive from the lower tier municipalities’ compensation based upon the discounted futurecash flows of the landfill site. The County is involved with ongoing negotiations with respect to thesettlements for further sites.

During 2015, the County entered into a multi-year agreement with Peterborough Fire Services forfire dispatch services. The annual costs under the agreement, which goes until the end of 2020,were approximately $377,000 in the first year with annual increases as per the agreement. The totalcosts for 2018 was $400,850.

18. SEGMENTED INFORMATION

The County of Northumberland is a municipal government organization that provides a range ofservices to its residents. County services are reported by function and their activities are separatelydisclosed in the segmented information.

For each reported segment, revenues and expenses represent both amounts that are directlyattributable to the segment and amounts that are allocated to the segment. Certain allocationmethodologies are employed in the preparation of segmented financial information. Taxation leviedto lower tiers is allocated based on each segment's net requirements. Internal transfers include thefollowing: 1) Actual wages and benefits expenses for governance, corporate management andinformation technologies that are allocated based on the segment's proportionate share asdetermined by head count, revenue and number of computers; and 2) Actual occupancy costs thatare allocated based on the segment's proportionate share of the square footage of the Countybuildings.

The accounting policies used in these segments are consistent with those followed in thepreparation of the consolidated financial statements as disclosed in Note 1. For additionalinformation see the Consolidated Schedule of Segment Disclosure.

General Government

General government consists of the activities of Council and general financial and administrativemanagement of the County and its programs and services including contributions to the MunicipalProperty Assessment Corporation.

Protection Services

Protection services includes emergency measures, plumbing and septic inspections and ProvincialOffences Act charges.

Transportation Services

The activities of the transportation function includes maintenance and winter control of the County'sroads and bridges.

Environmental Services

The environmental function is responsible for providing waste collection, waste disposal andrecycling services to ratepayers.

16


18. SEGMENTED INFORMATION, continued

Health Services

The health services function consists of land ambulance services and contributions to the localhealth unit.

Social and Family Services

The social and family services consist of general assistance to inhabitants, homes for the aged andchild care services for the County.

Social Housing

The social housing services provides affordable housing to qualified inhabitants of the County.

Economic Development, Tourism and Forest

The function includes economic development and tourism operations and maintenance of theCounty forests.

19. SOCIAL HOUSING

The Northumberland County Housing Corporation was incorporated under Part III of The OntarioBusiness Corporations Act in response to the Province’s overall initiative to devolve Social Housingto local municipalities. The Corporation currently provides subsidized housing to its tenants andtheir families.

As the Service Manager, the County is now the sole shareholder of the Corporation.

On January 1, 2001 the Ontario Housing Corporation transferred 14 properties and certain headoffice assets to the Corporation. The properties transferred carried the following restriction:

“The properties cannot be transferred or mortgaged or otherwise encumbered, developedor redeveloped …. or disposed of by any person without prior consent of the Minister ofMunicipal Affairs and Housing.”

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CORPORATION OF THE COUNTY OF NORTHUMBERLANDCONSOLIDATED SCHEDULE OF TANGIBLE CAPITAL ASSETSFor the Year Ended December 31, 2018

General Infrastructure

LandLand

Improvements Buildings

Equipmentand

Computers VehiclesRoads and

BridgesAssets UnderConstruction Totals

$ $ $ $ $ $ $ $

COST

Balance, beginning of year 14,045,181 3,566,167 56,418,473 16,118,445 13,794,875 178,917,457 10,383,764 293,244,362

Add: additions during the year 82,800 494,721 1,500,895 1,278,388 1,234,231 7,088,548 6,569,613 18,249,196

Less: disposals during the year - - - - 197,894 2,744,830 - 2,942,724

Internal transfers - - 10,156 - - 1,530,185 (1,540,341) -

Balance, end of year 14,127,981 4,060,888 57,929,524 17,396,833 14,831,212 184,791,360 15,413,036 308,550,834

ACCUMULATED AMORTIZATION

Balance, beginning of year - 443,699 32,156,261 9,570,160 7,847,810 80,766,802 - 130,784,732

Add: additions during the year - 96,552 2,146,245 899,544 1,188,425 4,112,972 - 8,443,738

Less: disposals during the year - - - - 197,894 3,093,604 - 3,291,498

Balance, end of year - 540,251 34,302,506 10,469,704 8,838,341 81,786,170 - 135,936,972

NET BOOK VALUE OF TANGIBLE CAPITALASSETS 14,127,981 3,520,637 23,627,018 6,927,129 5,992,871 103,005,190 15,413,036 172,613,862

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CORPORATIO N OF THE COUNTY OF NORTHUMBERLANDCONSOLIDAT ED SCHEDULE O F SEGMENT DISCLOSURE For the Year Ende d December 31, 2018

GeneralGovernment

ProtectionServices

TransportationServices

EnvironmentalServices

HealthServices

Social andFamily

ServicesSocial

Housing

EconomicDevelopment,Tourism and

Forest Consolidated$ $ $ $ $ $ $ $ $

RevenuesTax levy from lower tiers 2,997,491 1,017,136 17,264,529 6,126,155 8,304,116 10,032,751 5,709,745 2,889,519 54,341,442User charges 394,256 435,984 286,084 6,054,080 97,660 3,495,340 64,118 340,849 11,168,371Government transfers - operating - 359,617 - 14,929 6,080,930 25,236,147 5,144,879 479,490 37,315,992Government transfers - capitalOther municipalities

--

--

496,4121,531,000

-52,621

--

--

66,950-

32,400-

595,7621,583,621

Investment income 1,109,310 - - - - - - - 1,109,310Provincial Offences Act charges - 1,410,326 - - - - - - 1,410,326Rents 783,437 - - 5,894 - - 1,607,946 59,685 2,456,962Federal gas tax earned - - 2,772,091 - - - - - 2,772,091Waste Diversion Ontario grants - - - 1,033,657 - - - - 1,033,657Other - - - - - - - 125,778 125,778Donations 156 - - - - - 6,298 15,000 21,454Gain (loss) on disposal of tangible

capital assets - 5,203 357,279 8,000 1,597 - - - 372,079

Total revenues 5,284,650 3,228,266 22,707,395 13,295,336 14,484,303 38,764,238 12,599,936 3,942,721 114,306,845

ExpensesSalaries and benefits 5,331,581 1,076,354 3,813,414 3,736,661 9,602,300 14,780,641 555,378 1,740,548 40,636,877Interest charges 131,803 4,698 - 124,484 - 27,062 - - 288,047

Materials 2,350,007 560,609 4,463,988 3,787,697 1,054,722 2,502,656 2,200,792 945,603 17,866,074Contracted services 2,383,202 987,132 2,273,472 1,409,999 45,802 561,715 637,850 504,734 8,803,906Rents and financial 94,507 9,870 - 605 26,500 2,572 27,293 - 161,347External transfers 1,600 - - - 2,050,362 16,321,042 7,132,168 158,000 25,663,172

Amortization 647,461 9,396 4,864,327 723,861 528,326 104,068 1,174,583 391,716 8,443,738Internal transfers (6,485,839) 486,667 677,263 725,799 1,068,576 2,134,611 1,125,701 267,222 -

Total expenses 4,454,322 3,134,726 16,092,464 10,509,106 14,376,588 36,434,367 12,853,765 4,007,823 101,863,161

Net surplus/(deficit) 830,328 93,540 6,614,931 2,786,230 107,715 2,329,871 (253,829) (65,102) 12,443,684

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CORPORATION OF THE COUNTY OF NORTHUMBERLANDCONSOLIDATED SCHEDULE OF SEGMENT DISCLOSUREFor the Year Ended December 31, 2017

GeneralGovernment

ProtectionServices

TransportationServices

EnvironmentalServices

HealthServices

Social andFamily

ServicesSocial

Housing

EconomicDevelopment,Tourism and

Forest Consolidated$ $ $ $ $ $ $ $ $

RevenuesTax levy from lower tiers 2,905,388 913,803 16,523,293 6,052,551 8,078,555 9,780,278 5,972,247 2,526,414 52,752,529

User charges 437,987 454,187 210,187 6,588,784 149,164 3,399,956 62,289 270,526 11,573,080 Government transfers - operating - 308,244 - 19,190 5,855,320 21,802,876 2,959,418 387,955 31,333,003 Government transfers - capital

Other municipalities--

--

960,5521,284,587

--

--

--

697,850-

--

1,658,4021,284,587

Investment income 880,169 - - - - - - - 880,169Provincial Offences Act charges - 1,957,067 - - - - - - 1,957,067Rents 762,632 - - 6,094 - - 1,527,114 35,819 2,331,659Federal gas tax earned - - 2,526,584 - - - - - 2,526,584Waste Diversion Ontario grants - - - 1,133,282 - - - - 1,133,282Other - - - - - - - 58,043 58,043Donations 115 - - - - 12,836 - - 12,951Gain (loss) on disposal of tangible

capital assets (72,581) - (360,950) (2,001) 68 - - - (435,464)

Total revenues 4,913,710 3,633,301 21,144,253 13,797,900 14,083,107 34,995,946 11,218,918 3,278,757 107,065,892

Expenses Salaries and benefits 4,659,764 1,026,343 3,459,433 4,046,232 9,155,130 13,707,487 574,456 1,410,147 38,038,992 Interest charges 339,371 7,242 3,071 89,190 - 29,051 190 - 468,115 Materials 1,962,440 606,386 3,984,848 3,794,185 1,003,214 2,269,168 2,395,488 1,086,594 17,102,323 Contracted services 2,107,964 1,000,726 2,111,536 2,676,829 73,974 552,777 480,480 507,488 9,511,774 Rents and financial 94,087 11,603 - 4,865 27,736 32,240 10,271 - 180,802 External transfers 1,600 - - - 2,013,449 13,473,200 5,436,610 109,000 21,033,859 Amortization 546,641 9,396 5,227,926 788,697 508,988 102,928 1,168,368 384,737 8,737,681 Internal transfers (6,323,698) 985,570 761,277 603,676 907,254 1,943,103 903,362 219,456 -

Total expenses 3,388,169 3,647,266 15,548,091 12,003,674 13,689,745 32,109,954 10,969,225 3,717,422 95,073,546

Net surplus/(deficit) 1,525,541 (13,965) 5,596,162 1,794,226 393,362 2,885,992 249,693 (438,665) 11,992,346

20

Baker Tilly KDN LLP272 Charlotte St.Peterborough, ONCanada K9J 2V4

T: (705) 742-3418F: (705) 742-9775

www.bakertilly.ca


To the Members of Council, Inhabitants and Ratepayersof the Corporation of the County of Northumberland

Qualified OpinionWe have audited the financial statements of the Trust Funds of the Corporation of the County ofNorthumberland (the Trust Funds), which comprise the statement of financial position as atDecember 31, 2018, the statement of continuity for the year then ended, and notes to the financialstatements, including a summary of significant accounting policies.

In our opinion, except for the possible effects of the matter described in the Basis for Qualified Opinionsection of our report, the accompanying financial statements present fairly, in all material respects, thefinancial position of the Trust Funds as at December 31, 2018, and the continuity of the Trust Funds forthe year then ended in accordance with Canadian Public Sector Accounting Standards.

Basis for Qualified OpinionIn common with many municipal trust funds, the completeness of the revenue derived from residents isnot susceptible to satisfactory audit verification. Accordingly, our verification of these revenues waslimited to the amounts recorded in the records of the Trust Funds and we were not able to determinewhether any adjustments might be necessary to resident receipts, assets and fund balances at the end ofthe year.

We conducted our audit in accordance with Canadian generally accepted auditing standards. Ourresponsibilities under those standards are further described in the Auditor's Responsibilities for the Auditof the Financial Statements section of our report. We are independent of the Trust Funds in accordancewith the ethical requirements that are relevant to our audit of the financial statements in Canada, and wehave fulfilled our other ethical responsibilities in accordance with these requirements. We believe thatthe audit evidence we have obtained is sufficient and appropriate to provide a basis for our qualifiedopinion.

Other MatterThe financial statements of the Trust Funds as at and for the year ended December 31, 2017 wereaudited by Collins Barrow Kawarthas LLP, which became Baker Tilly KDN LLP effective January 10,2019.

Responsibilities of Management and Those Charged with Governance for the Financial StatementsManagement is responsible for the preparation and fair presentation of the financial statements inaccordance with Canadian Public Sector Accounting Standards, and for such internal control asmanagement determines is necessary to enable the preparation of financial statements that are freefrom material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Trust Funds's abilityto continue as a going concern, disclosing, as applicable, matters related to going concern and using thegoing concern basis of accounting unless management either intends to liquidate the Trust Funds or tocease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Trust Funds's financial reporting

process.

Auditor's Responsibilities for the Audit of the Financial StatementsOur objectives are to obtain reasonable assurance about whether the financial statements as a whole arefree from material misstatement, whether due to fraud or error, and to issue an auditor's report thatincludes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that anaudit conducted in accordance with Canadian generally accepted auditing standards will always detect amaterial misstatement when it exists. Misstatements can arise from fraud or error and are consideredmaterial if, individually or in the aggregate, they could reasonably be expected to influence the economicdecisions of users taken on the basis of these financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exerciseprofessional judgment and maintain professional skepticism throughout the audit. We also: • Identify and assess the risks of material misstatement of the financial statements, whether due to

fraud or error, design and perform audit procedures responsive to those risks, and obtain auditevidence that is sufficient and appropriate to provide a basis for our opinion. The risk of notdetecting a material misstatement resulting from fraud is higher than for one resulting from error, asfraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override ofinternal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit proceduresthat are appropriate in the circumstances, but not for the purpose of expressing an opinion on theeffectiveness of the Trust Funds's internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accountingestimates and related disclosures made by management.

• Conclude on the appropriateness of management's use of the going concern basis of accountingand, based on the audit evidence obtained, whether a material uncertainty exists related to eventsor conditions that may cast significant doubt on the Trust Funds's ability to continue as a goingconcern. If we conclude that a material uncertainty exists, we are required to draw attention in ourauditor's report to the related disclosures in the financial statements or, if such disclosures areinadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up tothe date of our auditor's report. However, future events or conditions may cause the Trust Funds tocease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including thedisclosures, and whether the financial statements represent the underlying transactions and eventsin a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the plannedscope and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.

Baker Tilly KDN LLPChartered Professional AccountantsLicensed Public Accountants

Peterborough, OntarioMay 28, 2019

CORPORATION OF THE COUNTY OFNORTHUMBERLANDTRUST FUNDSSTATEMENT OF FINANCIAL POSITIONAt December 31, 2018

BlacklockBequest

SafekeepingPensioners

2018Total

2017Total

$ $ $ $

FINANCIAL ASSETSCash 648 28,140 28,788 38,196Investment (note 3) 114,814 - 114,814 113,169

115,462 28,140 143,602 151,365

FUND BALANCESDue to Residents - 28,140 28,140 37,560Bequests 115,462 - 115,462 113,805

115,462 28,140 143,602 151,365

TRUST FUNDSSTATEMENT OF CONTINUITYFor the Year Ended December 31, 2018

BlacklockBequest

SafekeepingPensioners

2018Total

2017Total

$ $ $ $

BALANCES - beginning of year 113,805 37,560 151,365 157,258

RECEIPTSResidents' contributions - 38,042 38,042 47,840Interest earned 1,657 - 1,657 1,197

1,657 38,042 39,699 49,037

EXPENSESResidents' personal costs - 47,462 47,462 54,930

BALANCES - end of year 115,462 28,140 143,602 151,365


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CORPORATION OF THE COUNTY OFNORTHUMBERLANDTRUST FUNDSNOTES TO THE FINANCIAL STATEMENTSFor the Year Ended December 31, 2018

1. PURPOSE OF TRUST FUNDS

The County is required, under Section 241 of Ontario Regulation 79/10 as prescribed by the Long-Term Care Homes Act, 2007, to maintain a trust fund to manage the funds of the residents of theCounty's home for the aged.

The Blacklock bequest was created by a donation and is for the use of the County's Long TermCare Home called the Golden Plough Lodge.

2. SIGNIFICANT ACCOUNTING POLICIES

These financial statements have been prepared in accordance with the standards in the CharteredProfessional Accountants Canada Public Sector Accounting (PSA) Handbook.

(a) Basis of Accounting

Revenue and expenses are reported on the accrual basis of accounting which recognizesrevenues as they become available and measurable; expenses are recognized as they areincurred and measurable as a result of receipt of goods or services and the creation of a legalobligation to pay.

(b) Use of Estimates

The preparation of financial statements in conformity with Canadian generally acceptedaccounting principles requires management to make estimates and assumptions. Theseestimates and assumptions affect the reported amounts of assets and liabilities and disclosureof contingent assets and liabilities at the date of the financial statements, and the reportedamounts of revenue and expenses during the period and are based on the County's bestinformation and judgment. Actual results could differ from these estimates.

3. INVESTMENT

The investment is recorded at cost and has been invested in a Renaissance high interest savingsaccount SR F (5001) with CIBC Wood Gundy.

24

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Whether it is distributing food donations from the Food 4 All warehouse to local programs, providing entertainment for the residents of the Golden Plough Lodge, or offering coaching to small business entrepreneurs, Northumberland residents make invaluable contributions to County programs and services that leave a lasting impression on our community.Looking to get involved? We always welcome new volunteers! Join our volunteer team and work with us to create possibilities for a thriving Northumberland!

Volunteer opportunities include positions in:• Northumberland County Archives• Business & Entrepreneurship Centre Northumberland• Food 4 All warehouse• Golden Plough Lodge long term care home

For more information on how to apply to become a volunteer, please call 905-372-3329.

Support your community

VOLUNTEER WITH THE COUNTY

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Visit our websiteNorthumberland.ca

News and noticesNews, as well as information about community consultations and other public notices, is regularly posted in Northumberland newspapers. This information, along with photos, videos and other details, can also be found in the County Newsroom at Northumberland.ca/Newsroom

Social mediaWe’re social! Connect with Northumberland County via Facebook, Twitter, and YouTube. Visit Northumberland.ca/FollowUs

County Council meetingsCouncil meetings are open to the public, and take place on the third Wednesday of each month (Note: subject to change).

Click on councilAccess minutes, agendas, and reports through our easy-to-use Council Web Portal. Visit Northumberland.civicweb.net/portal/

Questions or comments?Councillors welcome and appreciate your feedback. Share your comments by calling or mailing our headquarters building (contact information above). Council email addresses are also available at Northumberland.ca/MeetYourCouncil

Call us905-372-3329

Toll Free: 1-800-354-7050

Visit us555 Courthouse RoadCobourg, ON K9A 5J6

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Northumberland CountyJuly 2019

2018 Annual Financial Report - Northumberland County · Northumberland County is committed to...

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