ANNUAL REPORT WHAT A CREDIT UNION WAS MEANT TO BE. RCU Rosenort Credit Union

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1 2015 ANNUAL REPORT RCU Rosenort Credit Union WHAT A CREDIT UNION WAS MEANT TO BE

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4 ROSENORT CREDIT UNION LIMITED Summary Statement of Comprehensive Income For the year ended September Revenue Interest on loans to members $ 9,568,956 $ 8,680,192 Investment income Liquidity deposits 598, ,696 Debentures and shares 312, ,519 10,480,139 9,676,407 Cost of Funds Interest paid to members 5,518,141 5,029,228 Interest on borrowings 98,029 69,789 5,616,170 5,099,017 Gross financial margin 4,863,969 4,577,390 Operating Expenses Personnel 1,488,846 1,450,394 Administrative 582, ,863 Occupancy 284, ,936 Members' security 278, ,231 Organizational 175, ,211 Distribution to members 24,120 21,068 Gross operating expenses 2,834,480 2,845,703 Less other income 750, ,927 2,083,881 2,216,776 Gross operating income 2,780,088 2,360,614 Provision for (recovery of) impaired loans (71) 1,784 Income before income taxes 2,780,159 2,358,830 Provision for Income Taxes Current 392, ,321 Deferred (18,662) (17,394) 374, ,927 Net income for the year 2,405,845 2,067,903 Other Comprehensive Income, Net of Tax Change in unrealized gains on available-for-sale investments 16, ,694 Total comprehensive income for the year $ 2,422,506 $ 2,178,597 The accompanying notes are an integral part of these summary financial statements.

5 For the year ended September 30, 2015 ROSENORT CREDIT UNION LIMITED Summary Statement of Changes in Members' Equity Accumulated Other Comprehensive Income Provision for Issue of Surplus Shares Provision for Issue of Preference Shares Members' Shares Retained Earnings Total Balance at September 30, 2013 $ 21,301 $ 71,657 $ - $ 3,027,684 $ 10,653,129 $ 13,773,771 Net income for the year ,067,903 2,067,903 Distributions to members - 69,327 24,873 - (64,356) 29,844 Issue of members' shares - (70,979) - 1,482,439-1,411,460 Redemption of members' shares (164,669) - (164,669) Change in unrealized gains on available-for-sale investments 110, ,694 Transfer from liabilities (489,411) - (489,411) Balance at September 30, 2014 $ 131,995 $ 70,005 $ 24,873 $ 3,856,043 $ 12,656,676 $ 16,739,592 Net income for the year ,405,845 2,405,845 Distributions to members - 67, ,163 - (127,923) 41,564 Issue of members' shares - (70,005) (24,873) 2,205,442-2,110,564 Redemption of members' shares (220,723) - (220,723) Change in unrealized gains on available-for-sale investments 16, ,661 Transfer to liabilities (169,748) - (169,748) Balance at September 30, 2015 $ 148,656 $ 67,324 $ 102,163 $ 5,671,014 $ 14,934,598 $ 20,923,755 The accompanying notes are an integral part of these summary financial statements.

6 ROSENORT CREDIT UNION LIMITED Summary Statement of Cash Flows For the year ended September Cash Flows from Operating Activities Net income for the year $ 2,405,845 $ 2,067,903 Adjustments for Interest and investment revenue (10,480,139) (9,676,407) Interest expense 5,616,170 5,099,017 Depreciation expense 164, ,730 Provision for (recovery of) impaired loans (71) 1,784 Gain on disposal of property, plant and equipment - (1,211) Deferred taxes (18,662) (17,394) (2,311,966) (2,364,578) Change in other assets and liabilities (154,783) 322,861 Change in income taxes payable 286, , , ,638 Changes in member activities, net Change in loans to members (12,720,764) (48,426,159) Change in members' deposits 44,992,919 19,248,210 32,272,155 (29,177,949) Cash flows related to interest, dividends, and income taxes Interest received on loans to members 9,625,710 8,420,760 Interest received on investments 903,540 1,038,542 Interest paid on members' deposits (5,087,850) (4,690,187) Interest paid on borrowings (98,029) (69,789) Income taxes paid (290,170) (192,697) 5,053,201 4,506,629 Total cash flows from operating activities 35,144,729 (26,467,260) Cash Flows from Investing Activities Disposal of property, plant and equipment - 2,105 Redemption (purchase) in investments (252,955) 508,244 Purchase of property, plant and equipment (59,526) (185,188) Total cash flows from investing activities (312,481) 325,161 Cash Flows from Financing Activities Issue of common and surplus shares 2,134,684 1,432,528 Redemption of common and surplus shares (220,723) (164,669) Total cash flows from financing activities 1,913,961 1,267,859 Net increase (decrease) in cash and cash equivalents 36,746,209 (24,874,240) Cash and cash equivalents, beginning of year 12,120,807 36,995,047 Cash and cash equivalents, end of year $ 48,867,016 $ 12,120,807 Comprised of the following Funds on hand and on deposit $ 9,867,016 $ 5,031,902 Credit Union Central of Manitoba deposits 39,000,000 19,000,000 Credit Union Central of Manitoba borrowings - (11,911,095) The accompanying notes are an integral part of these summary financial statements. $ 48,867,016 $ 12,120,807

7 ROSENORT CREDIT UNION LIMITED Notes to Summary Financial Statements For the year ended September 30, Basis of Presentation Management is responsible for the preparation of summary financial statements. The summary presented includes only the summary balance sheet and the summary statement of comprehensive income, summary statement of changes in members' equity and summary statement of cash flows. It does not include any other schedules or the notes to the financial statements. The summary balance sheet and summary statement of comprehensive income, summary statement of changes in members' equity and summary statement of cash flows are presented in the same detail as the audited financial statements except the note referencing has been removed. Copies of the September 30, 2015 audited financial statements are available at the Credit Union's head office at 23 Main Street, Rosenort, Manitoba. 2. Compliance with Minimum Capital and Liquidity Requirements The Credit Union is in compliance with the capital and liquidity reserve requirements at September 30, 2015 established by the Regulations to The Credit Unions and Caisses Populaires Act of Manitoba. Readers of the summary financial statements are advised that in order to appropriately interpret the Credit Union's capital and liquidity, the reader must refer to the audited financial statements including notes for the year ended September 30, 2015, which contain the information detailing the calculations. 2

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